Question
Western Paper Inc's warehouse was located next to Thames Explosives Ltd's factory. As a result of a careless manufacturing process, a fire erupted in Thames's
Western Paper Inc's warehouse was located next to Thames Explosives Ltd's factory. As a result of a careless manufacturing process, a fire erupted in Thames's premises and soon spread next door. By the time the blaze was contained by the local fire department, $100000 worth of Western's product had been destroyed. Western had purchased from Fortress Insurance first-party cover-age that entitled it to compensation for losses attributable to fire. Thames had purchased from Sentinel Insurance third party coverage that entitled it to complete protection from losses that it carelessly inflicted as a result of careless manufacturing processes. Explain how the insurance policies will apply in this case. Who will ultimately pay for the loss created by Thames and sustained by West-ern? Explain your answer.
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