Crow Wing County District Court File No. C8002969
Considered and decided by Toussaint, Chief Judge, Hudson, Judge, and
In a case where a tortfeasor causes damage to the property of another person, payments made by the tortfeasor's insurer to the other person are not subject to the collateral-source rule and are properly credited against the tortfeasor's liability.
The opinion of the court was delivered by: Poritsky, Judge *fn1
Appellants sued respondent for property damage to appellants' commercial building. After a bench trial to determine damages, the trial court ordered judgment. Respondent then brought a post-judgment motion to reduce the judgment by the amount of a payment that respondent's insurer had made to appellants' insurer. This payment was to reimburse appellants' insurer for a payment appellants' insurer had previously made to appellants. The district court granted the motion and reduced the amount of the judgment.
On appeal, appellants argue that (1)árespondents' motion to reduce the amount of the judgment was not timely, and (2)áthe collateral-source rule applied, and under that rule, the payment is not to reduce respondent's liability. Respondent, in his notice of review, challenges the district court's determination of damages. We affirm the district court in all respects. Specifically, we conclude that, in case of property damage, a payment by a tortfeasor's insurer directly or indirectly to the injured party serves to offset the tortfeasor's liability.
On June 7, 2000, a fire damaged a commercial building owned by appellants Allen and Laura VanLandschoot. The VanLandschoots filed the present action against respondent Brian Walsh, and the parties stipulated that Walsh, a welder, negligently started the fire and is liable for damage to the building.
The only issue before the district court in the bench trial was the amount of damages. After closing the record, the trial court issued its findings and order for judgment, concluding that the VanLandschoots sustained $68,000 in damages and could recover prejudgment interest, costs, and disbursements.
Both parties brought post-trial motions. The VanLandschoots moved to amend the findings. Walsh made several motions, including a motion to deduct from the judgment the amount that his insurer paid to VanLandschoots' insurer. In support of his motion, Walsh, for the first time in the proceeding, made the claim that his insurer paid $46,439.42 to the VanLandschoots' insurer and that this payment was reimbursement for a payment the VanLandschoots had received from their insurer.
The district court granted Walsh's motion to reduce the judgment by the amount of the payment made by his insurer but denied all other motions. In its memorandum, the court stated that Walsh's failure to present the evidence of payment at trial did not preclude him from asserting his claim after trial.
The VanLandschoots appeal from the order and amended judgment. Walsh filed a notice of review of ...