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Boat Owner's Insurance beats Engine Mfg in MO court
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Author:  pet575 [ Thu Aug 06, 2009 9:23 am ]
Post subject:  Boat Owner's Insurance beats Engine Mfg in MO court
A case recently went to trial in STL County, MO in which a boat owner's insurance company sued Brunswick for $22K in damage to the boat's engine resulting from an alleged faulty impeller. The jury found in favor of the boat owner's insurance company in the amount of $22K plus $50K+ in attorney's fees under the Magnuson-Moss Warranty Act.

Key facts:
2005 32 foot Rinker had 69 hours on it.
Owner's 20 year old son and his buddy tried to take boat out on the lake for first time in spring 2006. Didn't "summerize" it and the starboard side 350 MPI Merc engine overheated and caught fire. Expert investigation concluded that a faulty impeller caused the problem, as the owner's manual states that the impeller should be changed every 3 years/300 hours and this one failed prematurely at 69 hours. Brunswick said it was due to improper "summerization" because one of the plugs on the water pump's inlet valve was removed at winterization but wasn't replaced as part of the summerization. Son and his friend testified that they didn't see any plugs lying around in the bilge or cockpit.

Insurance company's expert said defective impeller definitely deteriorated/failed prematurely and that failure to replace plug couldn't have caused this situation. Insurance company's expert also said that failure to replace the plug would've caused failure of temperature gauges to give a reading and would've filled the bilge with water. Son and buddy testified that neither happened. Brunswick's expert said engine design doesn't allow water to ever enter the bilge, so that couldn't have happened either way. Brunswick's expert said the impeller was in the condition it was found to be in because of high temps in the engine, not because it was defective.

Brunswick came out immediately at owner's request to investigate and took photos as well. Brunswick failed to get a photo of the alleged plug that was not replaced. In post-trial interviews with the attorneys, the jurors indicated that the "failure" to get a photo of the hole where the missing plug was supposed to be really was a key fact for the jury.

The lawyer who was co-counsel on the case for the insurance company is a former co-worker of mine, so he gave me some of the inside skinny on this one. Pretty interesting case- not often that cases here in my jurisdiction (MO) which involve my hobbies (boats) go to trial and I have the advantage of knowing one side's attorney very well.

Thought you might all find the jury's perspective interesting on an issue common to most members here- changing your impeller when the owner's manual says you should.
Author:  boater [ Thu Aug 06, 2009 10:33 am ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
That's very interesting. Shouldn't alarms, buzzers and gauges have been going crazy before the engine actually started on fire ?
Author:  230 Mike [ Thu Aug 06, 2009 10:37 am ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
VERY interesting! Thanks for posting this.
Author:  BrentC5Z [ Thu Aug 06, 2009 11:40 am ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
Cool story Paul. Thanks for sharing.

boater wrote:
That's very interesting. Shouldn't alarms, buzzers and gauges have been going crazy before the engine actually started on fire ?

Not necessarily. Most temp sensors only work when they are touching the hot water. No water can equal no alarm.
Author:  aguyindallas [ Thu Aug 06, 2009 12:11 pm ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
Brent is right....steam alone isnt enough to give a reading.
Author:  FWFord's [ Thu Aug 06, 2009 12:20 pm ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
I might have missed it but a while back I could not find a recommendation for changing the impeller in the manual. Do any of you Merc 350 Mag owners know where that recommendation is located?

Thanks for the post.
Author:  Cincy Aquaholic [ Thu Aug 06, 2009 12:37 pm ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
Brent87LT1 wrote:
Cool story Paul. Thanks for sharing.

boater wrote:
That's very interesting. Shouldn't alarms, buzzers and gauges have been going crazy before the engine actually started on fire ?

Not necessarily. Most temp sensors only work when they are touching the hot water. No water can equal no alarm.


This is precisely why Merc has added water pressure sensors to its smartcraft gauges. The analogy goes like this, stick your hand in a 350 degree oven. Probably not a big deal. But then stick it in there and grab a rack. OUCH! So, without water no way for it transmit an over heating situation. My buddy lost an engine this way.

Good reason to have the automatic fire suppresion system.

Anyone have any idea what "plug" they are talking about??
Author:  Cincy Aquaholic [ Thu Aug 06, 2009 12:40 pm ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
As an aside, I'm shocked that these two large companies would go to trial over $22k! If the damages were $22k then clearly that case could have been settled for less, probably 10k to 15k. And so, you had $50k in fees. Just goes to show how pointless that effort was.

I hope your buddy was on the winning side because I'd hate to be facing my client telling them we lost $72k when it probably could have been resolved as noted above. Having said that, who's the client contact with this company? I'll send them some marketing materials . . . :mrgreen:
Author:  pet575 [ Thu Aug 06, 2009 3:18 pm ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
Ya, I thought it was interesting as well. The expert said no temp gauge indicator would've worked if the system was "open" due to the absence of the plug. I'm guessing the son probably wasn't familiar enough with the gauges or didn't pay attention to them until it was too late. There was also some testimony that the boat had been idling for 10 or more minutes before they took it out on the lake.

As for the money at stake and settlement v. trial: under the Magnuson-Moss Warranty Act you can recover attorneys' fees so there is really no incentive to settle for pennies on the dollar if you are the plaintiff. My buddy was representing the insurance company and said that the defendants weren't interested in settling for anything more than about $1,500. They stuck to their guns the whole way and were convinced that it was 100% operator error for failing to properly summerize and failure to monitor the gauges. No interest whatsoever in settling the claim. Insurance company was fine with my buddy handling it for an hourly fee, so they went with it.

I'm guessing the "plug" was a blue plug, but that was not clear from what I read there. I'll have to ask my buddy if I remember to do it. I have to wonder how much differently this case would've turned out if the jury was full of boaters. I'm betting it would've turned out worse for the insurance company. Even moreso if the issue of the "missing plug" was developed more thoroughly.

I'd volunteer to throw the court's info out there for everyone to access and read, but it was a decision handed down in a jury trial so there won't be a nice little summary or transcript that would be an easy read. I doubt my buddy would be willing to give up his trial brief, either.
Author:  Walt [ Thu Aug 06, 2009 4:24 pm ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
Hey Paul...
Should I sue FW for the $39 my impeller cost when it failed this summer? My boat is a 2007, but shouldn't that be three years? On second thought.... maybe I should just try to get them to buy it back!
Author:  FWFord's [ Thu Aug 06, 2009 6:23 pm ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
I found my answer. The "online" maintenance manual says every 300 hours or 3 years - disassemble, inspect, and replace worn parts. Well if I disassemble I might as well replace the parts since it's torn apart. Plus I'm not sure I would know what is worn and what might be ok for a while.

Self - add to fall miantenance list!!!
Author:  scottmph [ Mon Aug 10, 2009 4:45 pm ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
how about taking responsabilty for ones own actions?

I hate insurance companies - they get paid $$ for insuring - and when things go wrong - they start their subrogation.

evil industry - they are not your friends
Author:  pet575 [ Tue Aug 11, 2009 11:09 am ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
scottmph, this is why the attorney on the deal is a former co-worker of mine. I was specifically involved in subrogation at my old job. Representing insurance companies to recover money they have paid out. Some say it is fair and right, since others caused the harm. Others say it is legalized thievery. I think I probably had both views on certain days.

To think that the law used to allow an insurance company to subrogate against their own insureds when their own insured's ignorance/negligence was what caused the loss. :shock: At least the courts shot that down about 80 years ago...
Author:  KSJ08 [ Tue Aug 11, 2009 12:13 pm ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
Brent87LT1 wrote:
Cool story Paul. Thanks for sharing.

boater wrote:
That's very interesting. Shouldn't alarms, buzzers and gauges have been going crazy before the engine actually started on fire ?

Not necessarily. Most temp sensors only work when they are touching the hot water. No water can equal no alarm.



Actually MOST sensors have a bi-metallic contact strip that makes a complete circuit completing the ground to positive, whichs gives the signal to light and/or warning horn. So it just needs to reach temp to make bi-metallic strip contact, no matter what the medium is that cause temp to rise to that point.
Author:  Cincy Aquaholic [ Tue Aug 11, 2009 12:57 pm ]
Post subject:  Re: Boat Owner's Insurance beats Engine Mfg in MO court
I guess I don't see the problem with an insurance company trying to cover its losses when another party is at fault. Seems fair to me. I clerked in a firm that specialized in that kind of work when I was in law school. Sure isn't exciting but always seemed logical. At least the insured (you) don't have to worry about getting your money.

Health insurers do this as well. If they pay you medical bills for an accident you can be sure they will look towards finding out if someone caused this and will pursue reimbursement.
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