In Re Chicago Flood Litigation

680 N.E.2d 265 (1997)

Purchase the Printed Copy at bsmsphd.com

Nature of the Case

To access this section all you need to do is click here and register.

Facts

In April 1992, an underground freight tunnel in the central business district of Chicago flooded. Many buildings in the Loop were connected either directly or indirectly to the tunnel. Since 1959, the City has owned the tunnel, and since the 1970s it has leased the tunnel to a number of utility and telecommunications companies to carry service lines. In May 1991, the City entered into a contract with Great Lakes to remove and replace wood piling clusters at five bridges including the Kinzie Street Bridge. The contract warned Great Lakes not to drive pilings at any other location than that specified by the City because there could be an enormous risk of damage to other underground structures. The contract also provided that Great Lakes would be solely responsible for all damages from the failure to heed these explicit instructions. In September 1991, Great Lakes indicated that it had finished the work. However, Great Lakes had installed the pilings at the Kinzie Street Bridge in a location other than designated in the contract. This caused a breach in the tunnel wall. In January 1992, a television crew discovered the breach, and by February 1992 they notified the City. During March and April 1992, the City inspected the damaged and recommended that the tunnel be repaired. On April 13, 1992, the tunnel breach opened, and 200,000 persons had to be evacuated from numerous Loop buildings. The area was declared a disaster area by the Governor and by the President of the United States. A class of plaintiffs sought damages for various alleged losses proximately caused by the flood including injury to property, lost revenues, sales, profits, goodwill, wages, tips, commissions, lost inventory and expenses in obtaining alternate lodging, etc. Ps alleged that the City failed to properly contact and supervise Great Lakes and did not exercise ordinary care after discovering the breach nor warn Ps of the dangers. Ps alleged that these acts constituted willful and wanton misconduct and negligence. The trial court ruled that the Moorman doctrine barred recovery for merely economic losses without any property damages. Ps’ certified that question for review. The appeal court upheld the trial court.