economic loss doctrine in Illinois

2026“The Moorman doctrine, also known as the economic loss doctrine, states that there can be no recovery in tort for purely economic losses.” Olson v. Ferrara Candy Co., 2025 IL App (1st) 241126, ¶ 43 (citing Moorman, 91 Ill. 2d at 88 , - 15 - No. 1-25-0705 and citing Community Bank of Trenton v. Schnuck Markets, Inc., 887 F.3d 803, 812 (7th Cir. 2018)).

2025“The Moorman doctrine, also known as the economic loss doctrine, states that there can be no recovery in tort for purely economic losses.” Olson v. Ferrara Candy Co., 2025 IL App (1st) 241126, ¶ 43 (citing Moorman Manufacturing Co. v. National Tank Co., 91 Ill. 2d 69 (1982)). ¶ 208 The traditional rationale for the doctrine “is that courts can trust the commercial parties interested in a particular activity to work out an efficient allocation of risk among themselves in their contracts [citation], without having to resort to tort law, which is better reserved for a sudden, calamitous accident

2021The economic loss rule operates to prevent such open-ended tort liability.” Id. at 418 (quoting In re Chicago Flood Litigation, 176 Ill. 2d at 207 ). 1 There are three exceptions to the economic-loss rule: (1) where the plaintiff sustained personal injury or property damage resulting from a tortious event, i.e., a sudden or dangerous occurrence, (2) where the plaintiff’s damages are proximately caused by a defendant’s intentional, false representation, i.e., fraud, and (3) where the plaintiff’s damages are proximately caused by a negligent misrepresentation by a defendant in the business of su

2021The economic loss rule operates to prevent such open-ended tort liability.” Id. at 418 (quoting In re Chicago Flood Litigation, 176 Ill. 2d at 207 ). 1 There are three exceptions to the economic-loss rule: (1) where the plaintiff sustained personal injury or property damage resulting from a tortious event, i.e., a sudden or dangerous occurrence, (2) where the plaintiff’s damages are proximately caused by a defendant’s intentional, false representation, i.e., fraud, and (3) where the plaintiff’s damages are proximately caused by a negligent misrepresentation by a defendant in the business of su

2021Congregation of the Passion, Holy Cross Province, 159 Ill. 2d at 160-61 ; Anderson Electric, Inc. v. Ledbetter Erection Corp., 115 Ill. 2d 146, 150, 153 (1986); see also Sienna Court Condominium Ass’n, 2018 IL 122022, ¶ 21 (stating that an action for economic loss generally requires the plaintiff and the defendant to be in contractual privity). ¶ 62 The economic loss doctrine also seeks to define the contours of duty. 2314 Lincoln Park West Condominium Ass’n v. Mann, Gin, Ebel & Frazier, Ltd., 136 Ill. 2d 302, 315 (1990).

2021Sienna Court Condominium Ass’n, 2018 IL 122022, ¶ 21 ; see, e.g., 2314 Lincoln Park West - 19 - No. 1-19-2427 Condominium Ass’n, 136 Ill. 2d at 316-17 (finding “the plaintiff’s theory that the defendant architectural firm was negligent in its design of the structure” concerned the quality, rather than the safety, of the building and consequently was more appropriately resolved through contract law); Fireman’s Fund Insurance Co., 176 Ill. 2d at 161 (holding that the economic loss doctrine prohibits a tort action against an engineer for purely economic losses).

2021Congregation of the Passion, Holy Cross Province, 159 Ill. 2d at 160-61 ; Anderson Electric, Inc. v. Ledbetter Erection Corporation, 115 Ill. 2d 146, 150, 153 (1986); see also Sienna Court - 19 - No. 1-19-2427 Condominium Ass’n, ¶ 21 (stating that an action for economic loss generally requires the plaintiff and the defendant to be in contractual privity). ¶ 62 The economic loss doctrine also seeks to define the contours of duty. 2314 Lincoln Park West Condominium Ass’n v. Mann, Gin, Ebel & Frazier, Ltd., 136 Ill. 2d 302, 315 (1990).

2021Congregation of the Passion, Holy Cross Province, 159 Ill. 2d at 160-61 ; Anderson Electric, Inc. v. Ledbetter Erection Corp., 115 Ill. 2d 146, 150, 153 (1986); see also Sienna Court Condominium Ass’n, 2018 IL 122022, ¶ 21 (stating that an action for economic loss generally requires the plaintiff and the defendant to be in contractual privity). ¶ 62 The economic loss doctrine also seeks to define the contours of duty. 2314 Lincoln Park West Condominium Ass’n v. Mann, Gin, Ebel & Frazier, Ltd., 136 Ill. 2d 302, 315 (1990).

2016The economic loss rule operates to prevent such open-ended tort liability.” (citing In re Chicago Flood Litigation, 176 Ill. 2d 179, 207 (1997))); see also In re Illinois Bell Switching Station Litigation, 161 Ill. 2d at 241 (“The Moorman holding is bottomed upon the theory that tort law affords a remedy for losses occasioned by personal injuries or damage to one’s property, but contract law and the Uniform Commercial Code offer the appropriate remedy for economic losses occasioned by diminished commercial expectations not coupled with injury to person or property.

2016The economic loss rule operates to prevent such open-ended tort liability.” (citing In re Chicago Flood Litigation, 176 Ill. 2d 179, 207 (1997))); see also In re Illinois Bell Switching Station Litigation, 161 Ill. 2d at 241 (“The Moorman holding is bottomed upon the theory that tort law affords a remedy for losses occasioned by personal injuries or damage to one’s property, but contract law and the Uniform Commercial Code offer the appropriate remedy for economic losses occasioned by diminished commercial expectations not coupled with injury to person or property.

2024The supreme court describes economic loss as “damages for inadequate value, costs of repair and replacement of the defective product, or consequential loss of profits—without any claim of personal injury or damage to other property.” (Internal quotation marks omitted.) Moorman, 91 Ill. 2d at 82 . ¶ 65 The supreme court provided the following three exceptions to the economic-loss rule: “(1) [When] the plaintiff sustained personal injury or property damage resulting from a tortious event, i.e., a sudden or dangerous occurrence [citation]; (2) [when] the plaintiff's damages are proximately caused

2024The supreme court describes economic loss as “damages for inadequate value, costs of repair and replacement of the defective product, or consequential loss of profits—without any claim of personal injury or damage to other property.” (Internal quotation marks omitted.) Moorman, 91 Ill. 2d at 82 . ¶ 65 The supreme court provided the following three exceptions to the economic-loss rule: “(1) [When] the plaintiff sustained personal injury or property damage resulting from a tortious event, i.e., a sudden or dangerous occurrence [citation]; (2) [when] the plaintiff's damages are proximately caused

2018See Trans States Airlines v. Pratt & Whitney Canada, Inc. , 177 Ill. 2d 21 , 26-27, 224 Ill.Dec. 484 , 682 N.E.2d 45 (1997) (setting forth exceptions to the economic loss doctrine, including an exception where the plaintiff has sustained personal injury or property damage due to a sudden or dangerous occurrence).

2018See Trans States Airlines v. Pratt & Whitney Canada, Inc. , 177 Ill. 2d 21 , 26-27, 224 Ill.Dec. 484 , 682 N.E.2d 45 (1997) (setting forth exceptions to the economic loss doctrine, including an exception where the plaintiff has sustained personal injury or property damage due to a sudden or dangerous occurrence).

2021See, e.g., Fattah, 2016 IL 119365, ¶ 24 (economic loss rule holds that a plaintiff may not recover for solely economic loss in tort); Redarowicz, 92 Ill. 2d at 176-78 (recognizing and applying the economic loss rule).

2016Redarowicz, 92 Ill. 2d at 174-76 . -5- ¶ 24 This court began its analysis by first holding that, under the economic loss rule, the builder-vendor could not be subject to liability in tort.

2014Thus, the court concluded that “[a]pplication of the Moorman doctrine limiting recovery of purely economic losses to contract *** is inappropriate where a relationship results in something intangible.” Id. at 164 ; see also Collins v. Reynard, 154 Ill. 2d 48, 52 (1992) (finding attorney malpractice claims are excepted from application of the economic loss doctrine). ¶ 59 In 2314 Lincoln Park West Condominium Ass’n v. Mann, Gin, Ebel & Frazier, Ltd., 136 Ill. 2d 302, 315 (1990), the supreme court noted other situations in which this court has distinguished Moorman and allowed tort actions seeki

2014Thus, the court concluded that "[a]pplication of the Moorman doctrine limiting recovery of purely economic losses to contract *** is inappropriate where a relationship results in something intangible." Id. at 164 ; see also Collins v. Reynard, 154 Ill. 2d 48, 52 (1992) (finding attorney malpractice claims are excepted from application of the economic loss doctrine). - 24 - 2014 IL App (1st) 130307 ¶ 59 In 2314 Lincoln Park West Condominium Ass'n v. Mann, Gin, Ebel & Frazier, Ltd., 136 Ill. 2d 302, 315 (1990), the supreme court noted other situations in which this court has distinguished Moorma

2021Congregation of the Passion, Holy Cross Province v. Touche Ross & Co., 159 Ill. 2d 137, 160 (1994). - 18 - No. 1-19-2427 ¶ 61 Much has been said with respect to the policies behind the economic loss doctrine.

2021Congregation of the Passion, Holy Cross Province, 159 Ill. 2d at 160-61 ; Anderson Electric, Inc. v. Ledbetter Erection Corp., 115 Ill. 2d 146, 150, 153 (1986); see also Sienna Court Condominium Ass’n, 2018 IL 122022, ¶ 21 (stating that an action for economic loss generally requires the plaintiff and the defendant to be in contractual privity). ¶ 62 The economic loss doctrine also seeks to define the contours of duty. 2314 Lincoln Park West Condominium Ass’n v. Mann, Gin, Ebel & Frazier, Ltd., 136 Ill. 2d 302, 315 (1990).

2021App. 3d 1011, 1017 (1984) (finding that the doctrine did not bar the warehouse tenants’ recovery for fire damage because there were no commercial dealings between those tenants and the defendant who installed the fire alarm system in the space adjacent to them), aff’d on other grounds by 112 Ill. 2d at 388 (finding the economic loss doctrine did not apply because the plaintiff’s sought damages for the loss of property other than the defective product and the loss resulted from a sudden and dangerous event).

2021See. - 22 - No. 1-19-2427 Scott & Fetzer Co., 112 Ill. 2d at 388 (finding the economic loss doctrine did not apply where the defendant supplied a defective fire alarm system). ¶ 69 Having determined that the economic loss doctrine barred Harleysville’s negligence claims, we find that the circuit court properly entered judgment in favor of defendants. ¶ 70 III.

2021App. 3d 599, 606 (1984) (stating that the economic loss doctrine applies where the plaintiff’s injuries directly relate to reasonable commercial expectations and the plaintiff has an adequate contract action against the defendant) (reversed in part on other grounds, 105 Ill. 2d 474 (1985)); Scott & Fetzer Co. v. Montgomery Ward & Co., Inc., 129 Ill.

2021App. 3d 599, 606 (1984) (stating that the economic loss doctrine applies where the plaintiff’s injuries directly relate to reasonable commercial expectations and the plaintiff has an adequate contract action against the defendant), rev’d in part on other grounds, 105 Ill. 2d 474 (1985); Scott & Fetzer Co. v. Montgomery Ward & Co., 129 Ill.

2024App. 3d at 353 , 763 N.E.2d at 436 (the collapse of a building frame during a thunderstorm was a sufficiently sudden and dangerous occurrence to fall within the scope to the exceptions). ¶ 91 As the court explained in United Air Lines, “when a sudden and dangerous event occurs resulting in personal injury or property damage, as well as economic loss, an otherwise qualitative defect, which develops or manifests itself either gradually or suddenly, loses its inflexible classification as such in the realm of the economic loss doctrine, and tort, rather than contract, law is the appropriate remedy

2010Mars, Inc., 327 Ill.App.3d at 351 , 261 Ill.Dec. 458 , 763 N.E.2d at 434 .

2021In re Chicago Flood Litigation, 176 Ill. 2d 179, 200-01 (1997) (stating that gradual deterioration is insufficient to satisfy this exception); Westfield Insurance Co. v. Birkey’s -5- No. 1-19-2427 Farm Store, Inc., 399 Ill.

2021In re Chicago Flood Litigation, 176 Ill. 2d 179, 200-01 (1997) (stating that gradual deterioration is insufficient to satisfy this exception); Westfield Insurance Co. v. Birkey’s Farm Store, Inc., 399 Ill.

2021See also Hecktman v. Pacific Indemnity Co., 2016 Il App (1st) 151459, ¶ 17 (finding that the plaintiffs failed to allege a sudden, dangerous or calamitous event and that their complaint instead alleged that their floors displayed damage over a period of time).

2021See also Hecktman v. Pacific Indemnity Co., 2016 IL App (1st) 151459, ¶ 18 (finding that the plaintiffs failed to allege a sudden, dangerous, or calamitous event and that their complaint instead alleged that their floors displayed damage over a period of time).

2024Sienna Court Condominium Ass’n v. Champion Aluminum Corp., 2018 IL 122022, ¶ 21 , 129 N.E.3d 1112 . - 38 - ¶ 85 There are three exceptions to the economic loss doctrine: (1) where the plaintiff sustained damage, such as personal injury or property damage, resulting from a sudden, dangerous, or calamitous occurrence; (2) where the plaintiff’s damages are proximately caused by a defendant’s intentional, false misrepresentation; and (3) where the plaintiff’s damages are proximately caused by a negligent misrepresentation by a defendant in the business of supplying information for the guidance of

2021In Moorman, 91 Ill. 2d at 91, the supreme court, adopting the majority view, announced the economic-loss rule/doctrine that a products-liability “plaintiff cannot recover for solely economic loss under the tort theories of strict liability, negligence and innocent misrepresentation.” 1 “The Moorman doctrine is intended to preserve the distinction between tort and contract.” Sienna Court Condominium Ass’n v. Champion Aluminum Corp., 2018 IL 122022, ¶ 21 .

2010See Trans States Airlines, 177 Ill.2d at 51 , 224 Ill.Dec. 484 , 682 N.E.2d at 58-59 ; Washington Courte Condominium Association-Four, 150 Ill.App.3d at 686-87 , 103 Ill.Dec. 752 , 501 N.E.2d at 1293-94 (alleged property damage to insulation, walls, ceilings, floors, and electrical outlets was incidental to defective window and doors and was consequential economic loss, which was barred from tort recovery by the economic loss doctrine); Chicago Heights Venture v. Dynamit Nobel of America, Inc., 782 F.2d 723, 729-30 (7th Cir.1986) (alleged property damage to ceilings and walls of apartments and

2010See Trans States Airlines, 177 Ill.2d at 51 , 224 Ill.Dec. 484 , 682 N.E.2d at 58-59 ; Washington Courte Condominium Association-Four, 150 Ill.App.3d at 686-87 , 103 Ill.Dec. 752 , 501 N.E.2d at 1293-94 (alleged property damage to insulation, walls, ceilings, floors, and electrical outlets was incidental to defective window and doors and was consequential economic loss, which was barred from tort recovery by the economic loss doctrine); Chicago Heights Venture v. Dynamit Nobel of America, Inc., 782 F.2d 723, 729-30 (7th Cir.1986) (alleged property damage to ceilings and walls of apartments and

2019In Beretta, the court recognized, “Although the economic loss doctrine is rooted in the theory of freedom of contract, it has grown beyond its original contract-based policy justifications of maintaining the fundamental distinction between contract and tort and protecting the freedom of parties to allocate risk by contract.” Id. at 422 .

2016Corp., 213 Ill. 2d 351, 418 (2004) (“the policy underlying the economic loss rule [is]: that because ‘the economic consequences of any single accident are virtually endless,’ a defendant who could be held liable for every economic effect of its tortious conduct would face virtually uninsurable risks, far out of proportion to its culpability.

2014Thus, the court concluded that “[a]pplication of the Moorman doctrine limiting recovery of purely economic losses to contract *** is inappropriate where a relationship results in something intangible.” Id. at 164 ; see also Collins v. Reynard, 154 Ill. 2d 48, 52 (1992) (finding attorney malpractice claims are excepted from application of the economic loss doctrine). ¶ 59 In 2314 Lincoln Park West Condominium Ass’n v. Mann, Gin, Ebel & Frazier, Ltd., 136 Ill. 2d 302, 315 (1990), the supreme court noted other situations in which this court has distinguished Moorman and allowed tort actions seeki

2014Thus, the court concluded that "[a]pplication of the Moorman doctrine limiting recovery of purely economic losses to contract *** is inappropriate where a relationship results in something intangible." Id. at 164 ; see also Collins v. Reynard, 154 Ill. 2d 48, 52 (1992) (finding attorney malpractice claims are excepted from application of the economic loss doctrine). - 24 - 2014 IL App (1st) 130307 ¶ 59 In 2314 Lincoln Park West Condominium Ass'n v. Mann, Gin, Ebel & Frazier, Ltd., 136 Ill. 2d 302, 315 (1990), the supreme court noted other situations in which this court has distinguished Moorma

2026“The Moorman doctrine, also known as the economic loss doctrine, states that there can be no recovery in tort for purely economic losses.” Olson v. Ferrara Candy Co., 2025 IL App (1st) 241126, ¶ 43 (citing Moorman, 91 Ill. 2d at 88 , - 15 - No. 1-25-0705 and citing Community Bank of Trenton v. Schnuck Markets, Inc., 887 F.3d 803, 812 (7th Cir. 2018)).

2025Moorman, 91 Ill. 2d 69 at 88 ; see Community Bank of Trenton v. Schnuck Markets, Inc., 887 F.3d 803, 812 (7th Cir. 2018) (Moorman doctrine generally bars tort liability “for purely economic losses *** where [the parties] have already ordered their duties, rights, and remedies by contract.”).

2026“The Moorman doctrine, also known as the economic loss doctrine, states that there can be no recovery in tort for purely economic losses.” Olson v. Ferrara Candy Co., 2025 IL App (1st) 241126, ¶ 43 (citing Moorman, 91 Ill. 2d at 88 , - 15 - No. 1-25-0705 and citing Community Bank of Trenton v. Schnuck Markets, Inc., 887 F.3d 803, 812 (7th Cir. 2018)).

2025“The Moorman doctrine, also known as the economic loss doctrine, states that there can be no recovery in tort for purely economic losses.” Olson v. Ferrara Candy Co., 2025 IL App (1st) 241126, ¶ 43 (citing Moorman Manufacturing Co. v. National Tank Co., 91 Ill. 2d 69 (1982)). ¶ 208 The traditional rationale for the doctrine “is that courts can trust the commercial parties interested in a particular activity to work out an efficient allocation of risk among themselves in their contracts [citation], without having to resort to tort law, which is better reserved for a sudden, calamitous accident

2019See, e.g., Davencourt at Pilgrims Landing Homeowners Ass’n v. Davencourt at Pilgrims Landing, LC, 2009 UT 65, ¶ 21 , 221 P.3d 234 ; Association of Apartment Owners of Newtown Meadows v. Venture 15, Inc., 167 P.3d 225, 285 (Haw. 2007); Ward Farnsworth, The Economic Loss Rule, 50 Val.

2019See, e.g., Davencourt at Pilgrims Landing Homeowners Ass’n v. Davencourt at Pilgrims Landing, LC, 2009 UT 65, ¶ 21 , 221 P.3d 234 ; Association of Apartment Owners of Newtown Meadows v. Venture 15, Inc., 167 P.3d 225, 285 (Haw. 2007); Ward Farnsworth, The Economic Loss Rule, 50 Val.

2019See, e.g., Davencourt at Pilgrims Landing Homeowners Ass’n v. Davencourt at Pilgrims Landing, LC, 2009 UT 65, ¶ 21 , 221 P.3d 234 ; Association of Apartment Owners of Newtown Meadows v. Venture 15, Inc., 167 P.3d 225, 285 (Haw. 2007); Ward Farnsworth, The Economic Loss Rule, 50 Val.

2018See, e.g., Davencourt at Pilgrims Landing Homeowners Ass’n v. Davencourt at Pilgrims Landing, LC, 2009 UT 65, ¶ 21 , 221 P.3d 234 ; Ass’n of Apartment Owners of Newtown Meadows v. Venture 15, Inc., 167 P.3d 225, 285 (Haw. 2007); Ward Farnsworth, The Economic Loss Rule, 50 Val.

2017See Moorman Manufacturing Co., 91 Ill. 2d at 86 ; Trans States Airlines v. Pratt & Whitney Canada, Inc., 177 Ill. 2d 21, 26-27, 41-42 (1997); Gunkel v. Renovations, Inc., 822 N.E.2d 150, 156-57 (Ind. 2005) (although the economic loss rule precluded tort recovery for damage to a home facade that was purchased separately from the home itself, it did not preclude tort recovery for damage to the home and its parts caused by the allegedly negligent installation of the facade); Restatement (Third) of Torts: Liability for Economic Harm § 2 cmt. b, illus. 2 (Tentative Draft No. 1, 2012); 10 see also R

2017See Moorman Manufacturing Co., 91 Ill. 2d at 86 ; Trans States Airlines v. Pratt & Whitney Canada, Inc., 177 Ill. 2d 21, 26-27, 41-42 (1997); Gunkel v. Renovations, Inc., 822 N.E.2d 150, 156-57 (Ind. 2005) (although the economic loss rule precluded tort recovery for damage to a home facade that was purchased separately from the home itself, it did not preclude tort recovery for damage to the home and its parts caused by the allegedly negligent installation of the facade); Restatement (Third) of Torts: Liability for Economic Harm § 2 cmt. b, illus. 2 (Tentative Draft No. 1, 2012); see also Rest