An insurer seeking to recoup $375,000 paid in connection with an implosion that damaged a policyholder's home asked a Pennsylvania state court to toss a demolition contractor's counterclaim for an offset of damages, saying the contractor attempted to improperly join a claim from a separate action.

In preliminary objections filed Tuesday, Erie Insurance Co. argued that Texas-based demolition contractor Grant Mackay Co. Inc.'s counterclaim constituted a misjoinder of claims and should be severed. According to court filings, the contractor is seeking an offset or setoff against any recovery sought by Erie based on damages Erie policyholder Daniel Garrigan alleged he incurred in a separate action.

"The proper procedure for Grant Mackay to pursue its claim for damages arising from the alleged improperly granted injunction is against Daniel Garrigan personally, not against Erie in this instant subrogation action," the insurer said.

The dispute stemmed from the demolition of two smokestacks at a coal-fired power station formerly known as the Cheswick Generating Station in Springdale, Pennsylvania. According to court filings, when the demolition took place in June 2023, the blast propelled dust, debris and flyrock into the surrounding residential neighborhood, damaging properties and utility lines.

Garrigan, whose home was across the street from the power station, submitted a claim to Erie for losses arising out of the damage. Erie, which paid out over $375,000 for the claim, sued the companies involved in the demolition in May.

Erie asserted claims of strict liability and negligence against Grant Mackay; Kentucky-based Charah Solutions Inc. and Cheswick Plant Environmental Redevelopment Group LLC, which were remediating and clearing the site; and explosive demolition subcontractor Controlled Demolition Inc. of Phoenix, Maryland.

Grant Mackay lodged a counterclaim in an amended response to the insurer's suit, asserting that it is entitled to damages from an injunction that was improperly granted in a separate action brought by Garrigan.

According to court filings, Garrigan and others were granted an injunction that prevented the implosion of the boiler house at the power station, but the decision was later reversed on appeal. Grant Mackay asserted that the damages it sustained exceeded the amount of a $50,000 bond posted by Garrigan and the others who filed the injunction, so any recovery by Erie must be reduced by the deficiency amount of the damages awarded to the contractor, it argued.

"Erie was not a party to that action and does not have any involvement in the claims for equitable or injunctive relief pursued by Daniel Garrigan," the insurer said Tuesday. "Pennsylvania law prohibits the joinder of claims involving nonparties or unrelated issues in a single action."

The insurer further contended that its subrogation rights are limited to the specific claim for which it made payment to Garrigan and do not extend to unrelated claims involving its insured.

Representatives of the parties did not immediately respond to requests for comment Friday.

Erie is represented by Melissa E. Kenney of White and Williams LLP.

Charah and Cheswick are represented by Cynthia L. O'Donnell and Paul Shane Miller of Freeman Mathis & Gary LLP.

Grant Mackay is represented by Timothy Smith and Julie A. Brennan of Pion Nerone Girman & Smith PC.

Counsel information for Controlled Demolition was not available.

The case is Erie Insurance Co. v. Charah Solutions Inc. et al., case number GD-25-005143, in the Court of Common Pleas for Allegheny County, Pennsylvania.