Atlas Mutual Insurance v. Moore Dry Kiln Co.

The issue here is whether a provision in a sales contract limiting the seller’s liabilities operated as a bar to a tort action based on both strict liability and negligence.

Plaintiffs’ insured, Seneca Sawmill, sustained fire damage to a dry kiln purchased from defendant. Plaintiffs compensated Seneca for its losses and sought to recover as subrogees against defendant. They alleged that the fire was caused by a defect in one of the kiln’s components parts and that they were entitled to relief on either a strict liability or negligence theory. Defendant interposed as an affirmative defense a…