Carrier Can’t Subrogate Against Students Who Caused Dartmouth Dormitory Fire

By | March 12, 2021

The high court ruled 3-0 Wednesday that Daniel Ro and Sebastian Lim, as tenants of the dormitory, were “implied co-insureds” under the college’s insurance policy. The court rejected Factory Mutual Insurance Co.’s argument that the students had waived that protection by violating rules clearly stated in the student handbook, including a prohibition against charcoal grills.

The opinion says a document on Dartmouth’s website states that the college insures its property for fire damage, but that personal property owned by students is not covered.

“Other courts have concluded that language in a rental agreement indicating that the landlord has insured the property could support a tenant’s reasonable expectation that the tenant was not required to do so,” the opinion says.

Ro and Lim admitted they were responsible for the Oct. 1, 2016 fire that damaged much of Dartmouth’s Morton Hall. They had left a small charcoal grill burning outside a window on the fourth floor of the dormitory building, which spread onto the building’s roof.

The fire displaced 67 students, who had to move off campus for much of the school year while the damage was repaired, according to local news reports. Dartmouth expelled Lim and Ro and denied an appeal, even after 1,100 people signed a petition urging leniency, according to a report in The Dartmouth, a student newspaper.

Factory Mutual paid Dartmouth $4,544,313.55 for its damage claim and then filed a subrogation demand. Lim and Ro responded by filing an action seeking declaratory relief. The superior court granted summary judgment in favor of the former students. The insurer appealed.

The Supreme Court said an Oklahoma appellate court created the principle that tenants are the implied co-insureds under a property insurance policy in a 1975 decision in a case titled Sutton v. Jondahl. New Hampshire adopted the “anti-subrogation doctrine” in 2004 in a case titled Cambridge Mutual Fire Insurance Co. v. Crete.

Factory Mutual argued that Lim and Ro were more akin to hotel guests than tenants who have a “possessary interest” in the property they lease. Students in dormitories are paying for nothing more than a license to occupy the campus, which is a “transient or impermanent interest,” the insurer argued. It noted that the college’s rules allowed it to relocate students to other rooms and assign other students to share their rooms.

The carrier said even if the students had possessory interest, they negated the anti-subrogation provisions of the Crete decision when they violated campus policies that barred any open flames in the dormitory building and stated that students may be held liable for any damage they caused.

“None of the policies, however, explicitly required the plaintiffs to purchase fire insurance on their respective dormitories or informed them that they could be liable on a subrogation claim by the college’s insurer if they negligently caused a fire,” the opinion says. “Rather, as the plaintiffs assert, the treatment of the subject of insurance in the student handbook and other college documents reinforced a reasonable expectation that the responsibility to insure dormitory buildings was allocated to Dartmouth College.”

The court affirmed the decision of the trial court finding in favor of Lim and Ro.

About the photo: Renovations underway after Oct. 1, 2016 fire at Darmouth College’s Morton Hall. Photo courtesy of Dartmouth Office of Residential Life.

Topics Carriers

About Jim Sams

Sams is editor of, the online resource and daily newsletter for property/casualty insurance claims professionals. ClaimsJournal is a member of the Wells Media Group. Sams can be reached at More from Jim Sams

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Latest Comments

  • March 15, 2021 at 12:46 pm
    Sure says:
    I think the point you're making ends up being moot in the end. The subrogation isn't dependent on them having insurance or not, it's dependent that they're co-insured's of the... read more
  • March 15, 2021 at 9:50 am
    Tiger88 says:
    Totally agree. Removing subrogation destroys one of the underpinnings of insurance: whoever causes the damage/injury via their negligence must pay.
  • March 12, 2021 at 1:56 pm
    Oh Goody says:
    I think the judge got it wrong. The insurance company should have the right to subrogate if the school didn't waive the right to subrogation against the students. Whether th... read more

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