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Commercial Law Keyed to Whaley
XL Specialty Insurance Co., as Subrogee of Chowaiki & Co., Fine Art Ltd. v. Christie’s Fine Art Storage Services, Inc.
Citation:
137 A.D.3d 563 (2016)Facts
Chowaiki & Co., a fine art gallery, stored various pieces of artwork with Christie’s Fine Art Storage Services under a bailment contract that contained a limitation of liability clause. The contract limited Christie’s liability to $100,000 per item regardless of the actual value of the stored artwork. A Christie’s employee subsequently stole several pieces of the stored artwork. XL Specialty Insurance, as Chowaiki’s insurer, paid Chowaiki’s claim for the stolen artwork valued at approximately $1.5 million. XL then sued Christie’s to recover this amount, arguing that the limitation of liability clause was unenforceable because the theft by Christie’s employee constituted gross negligence or willful misconduct on Christie’s part.
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