Fairchild Square Co. v. Green Mountain Bagel Bakery, Inc
In Fairchild Square Co. v. Green Mountain Bagel Bakery, Inc., 163 Vt. 433, 658 A.2d 31 (1995), the Court upheld a waiver-of-subrogation provision in a commercial lease agreement that allocated the responsibility of purchasing fire insurance to the landlord and contemplated that the parties would be reimbursed for fire loss through that policy. 163 Vt. at 435-37, 658 A.2d at 34-35.
In affirming the trial court's determination that the landlord had waived recovery for damages from a fire negligently caused by the tenant, the Court noted that the waiver-of-subrogation clause was plainly "intended to distribute the risk of loss by fire in a predictable way so that two commercial entities could insure against potential harm in the most logical and economic way," and that public policy considerations favored an agreement that avoided higher overall costs resulting from the multiplicity of insurance policies and overlapping coverage. Id. at 442, 658 A.2d at 36.