State guide · Northeast
Vermont subrogation law guide
An insured's negligence does not bar recovery if it is not greater than the combined causal negligence of the defendants, and damages are reduced by the insured's share. The insured recovers at 50% and is barred at 51%.
Vermont at a glanceVT
- Property damage
- 3 years
- Bodily injury
- 3 years
- Fault rule
- Modified, 51% bar
- Gov. notice
- None
Overview
Vermont is a 51% bar state with a few features that change how recovery files are built. Under 12 V.S.A. 1036, an insured recovers as long as its negligence is not greater than the combined causal negligence of the defendants, and the jury apportions only among parties actually in the case, so defendants cannot point to an empty chair. Personal injury and damage to personal property each run three years under 12 V.S.A. 512, while damage to real property and written contract claims fall under the six-year general period in 12 V.S.A. 511. Vermont has no products statute of repose and no general repose for construction, so an old furnace, chimney liner or roof truss failure can still support a recovery if the claim is timely from discovery. There is no general notice-of-claim requirement against towns or the State, but a bridge or culvert claim against a town requires notice to a selectboard member within 20 days. Landlord and tenant fire losses turn on the lease under Union Mutual Fire Insurance Co. v. Joerg, and Vermont has not adopted the made-whole rule. The economic loss rule keeps construction defect claims for damage to the work itself in contract.
Quick reference with citations
- Property damage SOL
- 3 years
- 12 V.S.A. 512(5) (damage to personal property); damage to real property falls under the 6-year general period in 12 V.S.A. 511
- Bodily injury SOL
- 3 years
- 12 V.S.A. 512(4) (runs from discovery of the injury)
- Product liability
- 3 years for personal injury, running from discovery (12 V.S.A. 512(4)), and 3 years for damage to personal property (512(5)). Vermont has no products statute of repose, and no general statute of repose for improvements to real property.
- Written contract
- 6 years
- Contract and indemnity recoveries
- Comparative fault rule
- Modified, 51% bar
- 12 V.S.A. 1036
- Government notice of claim
- No general statutory pre-suit notice
- No general pre-suit notice-of-claim requirement for towns, cities or the State; claims against the State proceed under the Vermont Tort Claims Act (12 V.S.A. ch. 189) on ordinary limitation periods. The trap is narrow but short: an action against a town for injury or damage caused by an insufficient or out-of-repair bridge or culvert requires signed written notice to a selectboard member within 20 days, stating the time, place and defect (19 V.S.A. 987).
Fault rule in practice
How Vermont's rule changes a $50,000 recovery.
An insured's negligence does not bar recovery if it is not greater than the combined causal negligence of the defendants, and damages are reduced by the insured's share. The insured recovers at 50% and is barred at 51%.
Authority: 12 V.S.A. 1036
| Insured's share of fault | Recoverable in VT | Under pure comparative |
|---|---|---|
| 0% | $50,000 | $50,000 |
| 20% | $40,000 | $40,000 |
| 50% | $25,000 | $25,000 |
| 60% | Barred | $20,000 |
Doctrines that move the number
Vermont doctrine checklist.
Made-whole doctrine
No Vermont appellate decision clearly adopts the traditional made-whole rule for insurer subrogation, and subrogation surveys treat Vermont as not applying it. Policy subrogation and reimbursement clauses are therefore likely to be enforced as written, though a court could still apply equitable principles where the policy is silent. Document the policy language and the insured's uninsured losses before negotiating priority.
Economic loss doctrine
Vermont follows the majority rule: no tort recovery for purely economic loss absent physical harm or a special relationship (Paquette v. Deere & Co., 719 A.2d 410 (Vt. 1998); Springfield Hydroelectric Co. v. Copp, 779 A.2d 67 (Vt. 2001)). In construction cases, damage to the property that is the subject of the contract is governed by contract principles (Long Trail House Condominium Ass'n v. Engelberth Construction, Inc., 59 A.3d 752 (Vt. 2012)).
Joint and several liability
Section 1036 apportions damages among the defendants against whom recovery is allowed by their share of causal negligence, and the jury apportions only among parties in the case, not absent settlors (Levine v. Wyeth). Vermont case law still describes joint tortfeasors as jointly and severally liable, and Vermont recognizes no contribution among joint tortfeasors, leaving indemnity as the main route between defendants.
Anti-subrogation and waiver
An insurer cannot subrogate against its own insured or a coinsured. Under Union Mutual Fire Insurance Co. v. Joerg, whether a tenant is an implied coinsured under the landlord's fire policy depends on the lease as a whole; a lease that requires the landlord to insure the premises generally protects the tenant, while Town of Stowe v. Stowe Theatre Guild, 2006 VT 79, held a tenant under an oral lease was not a coinsured.
Practice notes
Working Vermont subrogation files.
- 1
Pick the right clock by the type of property. A collision, contents or equipment loss is damage to personal property with three years under 512(5). Water or fire damage to the building itself is damage to real property, which falls under the six-year period in 511. When a single event damages both, calendar the three-year date as the controlling deadline and treat the six-year date as a fallback for the structure claim only.
- 2
Vermont's 51% bar compares the insured's fault with the combined fault of all defendants. On a $24,000 collision payment where the insured is found 40% at fault, the recovery is $14,400. At 50% it is $12,000. At 51% it is zero. Because Levine v. Wyeth keeps nonparties off the verdict form, naming every viable defendant both adds payers and keeps the defense from diluting fault onto absent actors.
- 3
In landlord and tenant fire losses, pull the lease before you open a file against the tenant. Joerg makes the outcome depend on the lease as a whole: a clause requiring the landlord to insure the building generally makes the tenant an implied coinsured, while a lease that makes the tenant responsible for fire damage or requires tenant liability coverage supports subrogation. Oral leases were not enough to protect the tenant in Town of Stowe.
- 4
A failed bridge or culvert on a town road triggers 19 V.S.A. 987: signed written notice to a selectboard member within 20 days, stating when and where the damage occurred, the defect, and that the claimant will seek recovery from the town. Twenty days is shorter than most adjusters' first diary review, so treat any narrative mention of a washed-out culvert or bridge deck as a same-week task.
- 5
Ishqkala applies the three-year personal property period to Vermont auto and contents files and the six-year period to structure damage, and it opens a 20-day notice task whenever the narrative places a loss at a town bridge or culvert. For landlord property files with a tenant-caused fire, the Liability Reasoning Engine holds the score until a reviewer confirms the lease does not make the tenant a coinsured.
Key cases
Union Mutual Fire Insurance Co. v. Joerg
2003 VT 27, 824 A.2d 586
Rejected an automatic rule making tenants coinsureds under a landlord's fire policy. A landlord's insurer can subrogate against a negligent tenant unless the lease, read as a whole, shows the parties expected the landlord's insurance to protect the tenant.
Levine v. Wyeth
2006 VT 107, 944 A.2d 179
Vermont's comparative negligence statute does not allow the jury to apportion fault to nonparties. A defendant cannot shrink its share by pointing to an absent or settled actor, which strengthens recoveries against the parties actually sued.
Springfield Hydroelectric Co. v. Copp
779 A.2d 67 (Vt. 2001)
Purely economic loss without accompanying physical harm is not recoverable in negligence absent a special relationship. Subrogated claims need physical damage to property beyond the bargained-for product or work.
Inter-company arbitration
Vermont auto and property subrogation between signatory carriers fits Arbitration Forums well because the dollar values are usually within compulsory jurisdiction of company-paid damages up to $100,000. Arbitrators apply 12 V.S.A. 1036, so an even split still pays half to the applicant. File within the three-year personal property period, and when a landlord's carrier files against a tenant's liability carrier, attach the lease, since the coinsured question under Joerg decides whether there is any subrogation right to arbitrate.
How Ishqkala applies this guide
VT rules, built into every score.
- Opportunities with a Vermont loss state are calendared against the 3 years property damage period or the 3 years bodily injury period, whichever controls the claim type.
- The insured's estimated fault share is applied under modified, 51% bar before recoverable dollars are scored.
- Public-entity claims are flagged for counsel review because notice and immunity rules vary by entity.
- Alerts fire at 180, 90, 45 and 15 days before the controlling deadline.
FAQ
Vermont subrogation FAQ
3 years (12 V.S.A. 512(5) (damage to personal property); damage to real property falls under the 6-year general period in 12 V.S.A. 511). A subrogating carrier generally takes the insured's claim subject to the same limitation period, usually measured from the date of loss.
Modified, 51% bar (12 V.S.A. 1036). An insured's negligence does not bar recovery if it is not greater than the combined causal negligence of the defendants, and damages are reduced by the insured's share. The insured recovers at 50% and is barred at 51%.
No general pre-suit notice-of-claim requirement for towns, cities or the State; claims against the State proceed under the Vermont Tort Claims Act (12 V.S.A. ch. 189) on ordinary limitation periods. The trap is narrow but short: an action against a town for injury or damage caused by an insufficient or out-of-repair bridge or culvert requires signed written notice to a selectboard member within 20 days, stating the time, place and defect (19 V.S.A. 987).
No Vermont appellate decision clearly adopts the traditional made-whole rule for insurer subrogation, and subrogation surveys treat Vermont as not applying it. Policy subrogation and reimbursement clauses are therefore likely to be enforced as written, though a court could still apply equitable principles where the policy is silent. Document the policy language and the insured's uninsured losses before negotiating priority.
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