Preventing Lawsuits and Lowering Insurance Costs

We live in a time when lawsuits are common. Every day energy supply companies are included in a wide range of cases that involve oil, gas and propane heating equipment. The Energy Research Center (ERC) has successfully helped defend oil companies for the past 20 years. This article is intended to identify key risk areas and present strategies for reducing the risks of lawsuits and prevailing in cases that occur.

John Batey, the president of ERC, has successfully assisted fuel marketers and equipment manufacturers to defend themselves against lawsuits through engineering investigations and expert testimony in a range of cases. These can be divided into the following general categories as shown in the following table that summarizes the number of cases completed to date.

                                                                             Heating Oil                 Gas/ Propane

Carbon Monoxide                                                       7                                  13       

Soot/Smoke                                                                 11                                2

Oil Leaks/Releases                                                      10                                –

Fires                                                                            16                                2

Burn Injuries                                                               3                                 1

Combustion Equipment Performance                        12                                3


The table shows that engineering services and support of oil dealers and equipment manufacturers represents a large part of the work completed by ERC.  We have been very effective in these efforts.  The carbon monoxide cases unfortunately often include personal-injury and in some cases death of building occupants. It is important to note that while it is more common to see gas and propane as a source of carbon monoxide emissions, heating oil can also cause high levels of CO.  About one third of the cases that we have assisted with so far have involved home heating oil as the suspected or actual cause of dangerous CO emissions.



Case studies

The following brief overview presents a sampling of assignments that we have completed to date in three of the categories shown above.   Some of the information has been changed to protect confidentiality.

Carbon Monoxide Incidents

Carbon monoxide is a highly toxic gas that can be produced by oil, propane and natural gas burners when incomplete combustion occurs. It is an odorless, colorless and tasteless gas that can cause death when concentrations are as low as 400 parts per million (ppm).   The eight hour exposure limit is only 35 ppm in air, and the action level is 10 ppm.  Approximately 200 to 300 people die each year due to exposure to high levels of carbon monoxide in their homes, according to U.S. Consumer Product Safety Commission reports.

Case 1.  Elderly couple dies in their home in Maryland

A husband and wife in their 70s died in their home in Maryland from carbon monoxide poisoning. The oil boiler was originally thought to be the source of CO due to equipment design, malfunction or improper burner adjustment. ERC conducted an in-depth investigation of the house and all combustion sources and eliminated the oil boiler and burner as a CO source. Combustion testing showed very low CO omissions in the flue gas of the oil boiler on the order of 10 ppm. In addition, the boiler was located in a very clean room that was painted white and the barometric damper was located very close to the wall. There was no sign of soot or smoke accumulation anywhere in the room. The investigation continued to look at all combustion sources within the home. None of them produce elevated CO readings. 

The inspection then turned to the garage of the home where we found a car that was physically separated from the home by a breezeway. Soot was observed on the surface of the car and on the interior of the air garage door. When speaking with the children of the decedents, we heard that their parents had trouble with the battery in their car.  Apparently, they had allowed the car to run in the garage in order to charge the battery. After further investigation, we found a pull down attic stairway in the garage that led to an attic space. This attic space connected with the main attic of the home. Carbon monoxide that was produced in the garage, rose up into the attic, and then was pulled down into the main living space by HVAC fans in the attic, causing the untimely deaths of the two homeowners.  The CO levels in the garage would have been very high on the order of 1 percent or 10,000 parts per million or higher, which can cause death in two or three minutes.

The findings of our investigation were that the oil burner did not play a role in the carbon monoxide injuries but, in fact, operating the automobile in the garage was the cause of the tragic incident. The lesson we learn from this investigation is that all combustion sources in the house must always be checked and evaluated, and do not assume that oil heating equipment was the source of the carbon monoxide incident.

Case 2.  Family injured in the home with an oil furnace

Alleged carbon monoxide injuries occurred to a family in their home located in a suburban area of New Jersey in which an oil furnace supplied heat. Initially, it was thought that the oil furnace was the source of the elevated carbon monoxide levels in the home.   We conducted an in-depth investigation that included inspection of the oil furnace and all combustion sources in the house.

The oil furnace had been located in a small room in the basement. Inside furnace room there was no trace of soot or smoke, which indicated that the oil equipment most likely could not have been the source of the carbon monoxide emissions. With oil equipment, smoke and soot normally occur before CO emissions increase.  We also thoroughly inspected the oil furnace and again found no signs of smoke or incomplete combustion. We then observed and investigated an unvented propane heater located in a lower level family room. We found heavy soot deposits on interior surfaces of the propane heater. Since this is an unvented appliance, any CO that is produced goes directly into the home.  In addition, family members had reported a funny smell when the propane heater had been operated. Odor and soot production by natural gas and propane heaters are important indicators of very high carbon monoxide emissions.

The propane heater was identified to be the source of the elevated carbon dioxide levels and injuries to the homeowners and their family.   The oil heating equipment and the oil supply and service companies were not responsible parties.   Again, it is important to consider all combustion sources within the home when conducting a carbon monoxide investigation.

Case 3.  Carbon Monoxide death in a home in a Delaware

A woman was found dead in a home that was heated with oil and the oil company was initially thought to be responsible for the incident.   Investigation revealed a chimney blockage as the primary cause for this CO incident. The home had been unoccupied for a period of time and apparently leaves and other debris had accumulated within the chimney over time. The oil company was called to supply oil to the tank, which was empty, and to restart the oil burner. These services were supplied following accepted industry practices. Subsequently, the partially burned debris formed a blockage in the chimney. This reduced airflow to the burner, produced smoke and carbon monoxide, and forced the incomplete combustion products into the home while the homeowner was asleep.

The chimney debris had accumulated while the house was unoccupied, and the heating system was inactive and was determined to be the primary cause of the incident. The oil company’s liability was limited as they had followed accepted industry practices for the service call that they provided. 

Soot and Smoke Damage

Smoke and soot are byproducts of incomplete combustion of heating oil.  Smoke and soot that are released from an oil heating system can deposit on interior surfaces within the building or house causing substantial damage.  Cleaning cost of these incidents can range from $10,000 to more than $200,000 in some cases. These are sometimes referred to as puff backs, but more frequently involve extended operation of an oil heating system when the house is unoccupied.   An example case follows.

Case 4.  Smoke and soot damage in home in Maryland

Severe smoke damage occurred in a house in Maryland while it was unoccupied, and it was believed that the oil furnace was in some way responsible. An engineering investigation was conducted by ERC and other parties. 

Oil service records indicated that burner tune-ups were supplied on a regular basis following accepted industry standards. In addition, combustion efficiency tests were conducted and the results were recorded in the service record, which proved that the burner had been properly adjusted on each occasion. Following accepted industry practices and adjusting burners to manufacturer recommendations are extremely important in limiting the liability of oil heat companies.  At the time that the oil company last serviced the heating equipment, it was adjusted optimally and produced excellent combustion efficiency ratings including a zero smoke reading. This information helped to eliminate the oil heating system as a cause of the soot production.

Further investigation revealed that a partition wall had been constructed in the basement very close to the side wall of the oil furnace. It violated the clearance to combustibles as required by the National Fire Protection Association. The smoke that damaged the house was produced by combustion of the wood walls surrounding the furnace, and not from operation of the oil burner. 

In this case, as in many related cases, records of combustion efficiency testing were very important in eliminating the oil burner as the source of the smoke and soot. This factual information is critical for proving that the oil burner and oil heating system are not responsible for the incident.

In a related case, a partially plugged nozzle caused substantial soot damage in an unoccupied home with an oil furnace.  Again, combustion efficiency test results which showed that the twenty year old boiler was operating close to its original specifications proved to be a very important factor in finding that the oil company and heating equipment were not responsible for the damages. 


House fires occur in homes heated by electricity, oil, natural gas and propane, and in many cases the heating equipment is initially thought to be responsible for the fire. Engineering investigations often prove that this is not true and identify other ignition sources for the fire. 

Case 5.  House fire blamed on oil furnace

A house was severely damaged in New Jersey and plaintiff’s expert attributed the cause of the fire to be ignition of soot in the exhaust pipe of the oil furnace. The expert report claimed that soot in the flue pipe ignited, caused the flue pipe to overheat and ignited wooden floor joists in the house.

A number of cases with similar claims have been made over the years. Our investigation showed that plaintiff’s expert theory was not technically feasible and that the oil furnace was not responsible for the fire. The theory that soot can burn in the flue pipe is not feasible because both the flue gas temperature and available oxygen are too low to ignite soot or support combustion.  Combustion test results for the furnace at the last service call prior to the fire showed that the burner was properly adjusted with the stack temperature of 450° F, good CO2, proper draft,  and zero smoke was being produced. These readings established that the burner was properly adjusted, soot free, and the stack temperature was far below the auto-ignition temperature of soot.  Furthermore, the physical evidence in the case did not support the theory that the flue pipe had overheated.   ERC supplied an in-depth investigation and engineering analysis of the case and provided an expert report that successfully challenged the claims that the oil furnace was responsible for the fire.

The oil company was found not responsible for the fire and resulting damage claims.  ERC’s expertise in combustion, oil heating equipment testing, and understanding of standard industry practices were very important in defending the oil company that serviced that furnace.

The example cases presented here provide a brief overview of some of the legal challenges that oil companies face every day.  It is possible to successfully defend against these claims and limit costs for damages. This can help to lower insurance premiums which are often based on the frequency of claims and the payments made for these claims.  Some common sense actions that can help lower risks follow.

Steps to Lower Risks from Legal Claims


The recommended actions that follow are based on many years of experience in defending oil heat equipment manufacturers and oil dealers in lawsuits involving heating equipment.

1.      Always use combustion test equipment and document these results at each service call that is related to burner operation.


2.      Preserve all service records including combustion efficiency test results for at least seven years or longer.


3.      Preserve fuel delivery records for each account for at least seven years.


4.      Follow accepted industry practices and equipment manufacturer service recommendations for adjusting and servicing equipment. This includes recommended settings for flue and over fire draft, carbon dioxide, flue gas temperature, and smoke readings.


5.      Always install heating equipment in accordance with national and local codes including NFPA -31- Installation of Oil Burning Equipment, and equipment manufacturer recommendations.


6.      Investigate all cases as soon as possible to preserve all evidence and operating conditions and enable successful defense against potential lawsuits.


7.      Review your service agreement to be sure that it protects you against common occurrences. This includes exclusions for unoccupied houses. The fuel dealer and service company cannot reasonably be held responsible for the conditions that occur after their service and to which they have not been alerted.


8.      Develop and implement a risk reduction program at your company.  Update this periodically and be sure that it is part of everyday operations.


The Energy Research Center supplied engineering services and is exceptionally well-qualified and experienced in oil burning equipment operation, installation, and performance evaluation. We have a unique understanding of standard oil heat industry practices through more than 30 years of experience and authorship of oil heat technical training guides with Brookhaven National Laboratory.  If we can assist you in any way, please contact us.

About the author:

John is a professional engineer and president of the Energy Research Center, Inc., – a firm specializing in oil heat, energy systems, and air emissions studies.  He received his Bachelor of Science and Master of Science degrees in engineering from the State University of New York at Stony Brook majoring in combustion, energy systems and air emissions control.


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