Industrial Park Center v. Great Northern Insurance

Argument summary

AI-generated — not an official transcript or court record.

1. Appellant counsel argues the court should adopt a subjective standard for fortuity based on Section 291 of the Restatement of Contracts, which defines fortuity by what the parties were aware of at the time of contracting.
2. The court questioned how a subjective standard operates when an insured is an absentee owner who purposefully ignores property deterioration, asking if this creates a 'should have known' scenario that contradicts pure subjectivity.
3. Appellant counsel contends that objective standards like 'reasonable foreseeability' or 'substantial certainty' would frustrate the purpose of insurance agreements by making them illusory, as people only insure against risks they perceive might happen.
4. Respondent counsel argues for an objective standard to prevent insureds from unilaterally controlling the outcome through their subjective awareness, citing public policy concerns about absentee owners neglecting maintenance.
5. The court asked respondent counsel how to distinguish between uninsurable foreseeable risks and insurable events, using examples of building in floodplains or national forests where damage is likely but not certain.
6. Respondent counsel suggests that if the court rejects a purely objective standard, it should modify the Restatement approach to include a reasonableness inquiry when there is a dispute over the insured's actual knowledge.

Recordings

1. Recording · PT46M7S · Captions available