Court of Appeals Upholds Dismissal of Personal Injury Suit Against Home Security Company

Recently the U.S. Court of Appeals for the Tenth Circuit, which hears appeals from jurisdictions including the District of New Mexico, upheld a ruling dismissing a personal injury suit based on a contractual one-year suit limitation provision.

The underlying personal injury suit was filed more than one year but less than two years after a house fire, which took the life of a woman who was living in the house. Representatives of the woman’s heir and of the woman’s estate sued the home security company that had purportedly provided home protection services. For $37.99 a month, the company had promised round the clock monitoring services. Its advertising was attention-getting and included promises of 24/7 professional monitoring centers that would address alarms immediately to make sure help was on the way. Yet, after receiving an alert late at night, the company made some calls from an unidentified number to try to investigate, but did not send help to the house or call the police or fire departments for help.

The contract pursuant to which the company provided its services did not include the promises made in the company’s advertising campaigns. The contract purported to limit liability to the lesser of $300 or 6 times the monthly service fee, and included a one-year suit limitation provision.

The company moved to dismiss the lawsuit against it on the basis that the lawsuit, then pending before the U.S. District Court for the District of Kansas, was untimely because it was brought more than one year after the house fire. The district court granted the home security company’s motion to dismiss, and the heir and estate representatives appealed the dismissal of their lawsuit to the U.S. Court of Appeals.

The U.S. Court of Appeals rejected the appellants’ arguments in favor of reversing the lower court’s ruling. First, the appellate court rejected the argument that the lower court should not have reached the issue of dismissal. The argument was based on the premise that the court wrongly considered an affirmative defense in the procedural posture of a dismissal motion. The court reasoned that, while some affirmative defenses may not lend themselves to consideration in this procedural posture, the time bar in this case was apparent from the face of the complaint. The court then rejected the appellants’ argument that the contract with the home security company was unconscionable. The court was of the view that when people pay small monthly premiums, it is not unconscionable for liability to be limited.

Next the Court rejected the appellants’ argument that the home security company’s wanton behavior and gross negligence voided provisions of the contract. The court also rejected the appellants’ invitation to treat the contract as void or unenforceable as a matter of public policy. The court went on to reject the appellants’ claims they were not bound by the contract because they were not parties to the contract. The court viewed their claims as being barred because they were tort claims covering basically the same claims as the contract. Finally, the court rejected the argument that the one year period for bringing a lawsuit should be tolled because the suit was brought on behalf of a minor. Before delivering its conclusion affirming the district court’s dismissal of the lawsuit, the appellate court wrote that because the deceased “would be unable to bring a claim more than a year after her death, those seeking to bring a wrongful death action are similarly limited.”

If you or a loved one has been hurt in an accident, there may be grounds for a financial recovery. In some cases multiple parties can be liable for the payment of money damages. Receiving damages can help injured people and their families recover out-of-pocket costs including medical bills and lost wages. To understand more about your case and how it can be pursued to maximize your financial recovery, call New Mexico personal injury lawyer Matthew Vance. At the Law Office of Matthew Vance, P.C., we provide a free consultation and can be reached at (505) 242-6267 or contact attorney Matthew Vance online.