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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Whittier Properties, Inc. v. Alaska National Insurance Co. (06/13/2008) sp-6273
Notice: This opinion is subject to correction before
publication in the Pacific Reporter. Readers are
requested to bring errors to the attention of the Clerk
of the Appellate Courts, 303 K Street, Anchorage,
Alaska 99501, phone (907) 264-0608, fax (907) 264-0878,
e-mail corrections@appellate.courts.state.ak.us.
THE SUPREME COURT OF THE STATE OF ALASKA
| WHITTIER PROPERTIES, INC., | ) |
| ) Supreme Court No. S- 12538 | |
| Appellant, | ) |
| ) Superior Court Nos. 3AN-05-14377 CI | |
| v. | ) |
| ) O P I N I O N | |
| ALASKA NATIONAL INSURANCE | ) |
| COMPANY, | ) No. 6273 June 13, 2008 |
| ) | |
| Appellee. | ) |
| ) | |
Appeal from the Superior Court of the State
of Alaska, Third Judicial District,
Anchorage, Peter A. Michalski, Judge.
Appearances: George R. Lyle, Guess & Rudd
P.C., Anchorage, for Appellant. Brewster H.
Jamieson and Andrea E. Girolamo-Welp, Lane
Powell LLC, Anchorage, for Appellee. Randall
J. Weddle, Holmes Weddle & Barcott P.C.,
Anchorage, and Laura A. Foggan, John C. Yang,
and Benjamin J. Theisman, Wiley Rein LLP,
Washington, D.C., for Amicus Curiae Complex
Insurance Claims Litigation Association.
Before: Fabe, Chief Justice, Matthews,
Eastaugh, and Carpeneti, Justices.
EASTAUGH, Justice.
I. INTRODUCTION
Is gasoline that leaked from the broken fill pipe of an
underground storage tank a pollutant within the meaning of the
absolute pollution exclusion contained in the tank owners
commercial liability insurance policies? We conclude that it is,
that the policies pollution exclusions unambiguously excluded
property damage arising out of the escape of gasoline, and that
other policy provisions do not restore or otherwise provide
coverage. We therefore affirm the summary judgment entered for
the insurer, Alaska National Insurance Company, against the
insured, Whittier Properties, Inc.
II. FACTS AND PROCEEDINGS
Whittier Properties, Inc. owned and operated a Zipmart
gas station and convenience store near Sterling from 1990 to
2000. In August 1995 Whittier closed the stations two 10,000
gallon underground storage tanks (USTs) and installed a new
20,000 gallon, three-compartment UST. When Whittiers contractor
installed the new UST it noticed soil contamination. Although
the Alaska Department of Environmental Conservation (ADEC)
notified Whittier that it should perform clean up, Whittier did
not comply with ADECs notice.
Alaska National Insurance Company (ANIC) issued
Whittier five commercial general liability insurance policies at
relevant times, providing liability coverage from May 29, 1996 to
May 29, 2001.1 Coverage A of each policy covers bodily injury
and property damage. Each policy also contains a pollution
exclusion for property damage arising out of discharge,
dispersal, seepage, migration, release or escape of pollutants.
Each policy defines a pollutant as any solid, liquid, gaseous or
thermal irritant or contaminant, including smoke, vapor, soot,
fumes, acids, alkalis, chemicals and waste.
In December 1999 Whittier also obtained a federally
required Storage Tank System Third-Party Liability and Corrective
Action Policy from Zurich American Insurance Company.2 The
Zurich policy provided coverage retroactive to 1997. The
application for the Zurich policy asked Whittier [d]o you
currently have pollution coverage for the tanks listed in the
application; Whittier replied NO.
In December 2000 Whittier closed its Zipmart gas
station. In December 2001 environmental specialists investigated
the site and found nearly a foot of free gasoline floating on the
groundwater. ADEC hired Statewide Petroleum Service to inspect
Whittiers UST; in February 2003 Statewide discovered that the
vertical fill pipe for one compartment of the new UST was broken.
The Alaska Attorney General commissioned an analysis of
Whittiers fuel inventory records in April 2003. The analysis
disclosed that the fill pipe first broke in February 1997, that
the break diminished in size from October 1997 to January 1998,
and that the break reopened in February 1998. The analysis also
determined that at least 50,800 gallons of gasoline were lost
from the time the fill pipe broke in 1997 until Whittier closed
the gas station in 2000.
Some of Whittiers neighbors filed three lawsuits
against Whittier in 2003 and early 2004 for compensatory and
punitive damages allegedly resulting from leaked gasoline
entering their properties.
In February 2004 Whittier tendered defense and
indemnity for the three claims to ANIC under two of ANICs
policies (98E PS 54321 and 99E PS 54321) and requested copies of
two other policies (96E PS 54321 and 97E PS 54321). ANIC
initially expressed doubt that the claims were within the
policies coverage, but later stated that ANIC would carefully
review the claims. Later that month Whittier also tendered
defense and indemnity for the claims under policies 96E PS 54321
and 97E PS 54321. In March Whittier tendered defense and
indemnity for the claims under the fifth ANIC policy, 00E PS
54321.
In May 2004 ANIC informed Whittier that it had reviewed
the lawsuits and policies and determined that there was no
potential for coverage under the policies and no duty on the part
of ANIC to defend the[] lawsuits. ANIC explained that gasoline
that leaked from the UST fell within the pollution exclusion in
each of the ANIC policies.
From May 2004 to May 2005 neighbors filed four more
lawsuits against Whittier for damage to their land caused by the
leaked gasoline. One of those neighbors, Sterling Baptist Church
(Church), also asserted a trespass claim. In September 2005 the
State of Alaska sued Whittier for response costs, damages, and
penalties arising from the leaked gasoline. Whittier tendered
defense and indemnity for these five claims to ANIC. In December
2005 ANIC denied coverage for the lawsuits after determining that
the pollution exclusion barred coverage for the claims.
Whittier sued ANIC for breach of contract, coverage by
estoppel, bad faith, and punitive damages. Whittier moved for
summary judgment, arguing that ANIC was estopped from raising any
coverage defenses because it failed to defend Whittier against
potentially covered claims. ANIC opposed Whittiers motion and
cross-moved for summary judgment, arguing that each policy
unambiguously excluded the leaked gasoline from coverage.
Whittier opposed the cross-motion and again moved for summary
judgment, this time arguing that there were exceptions to the
pollution exclusion. Whittier later moved for summary judgment
on the theory there was no valid pollution exclusion in the
personal injury coverage (Coverage B) of the ANIC policies.
ANIC filed an additional motion for summary judgment,
arguing that it had properly denied all of Whittiers tenders of
defense and indemnity. The superior court granted ANICs motion
and cross-motion for summary judgment and denied Whittiers
motions.
Whittier appeals.
III. DISCUSSION
A. Standard of Review
We review grants of summary judgment de novo and affirm
only if there are no genuine issues of material fact and the
prevailing party is entitled to judgment as a matter of law.3 We
draw all reasonable inferences in favor of the non-prevailing
party.4
Contract interpretation presents a question of law that
we review de novo.5 We look to the language of the disputed
policy provision, other provisions of the policy, and relevant
extrinsic evidence.6 The policy generally determines the
liability of the insurer.7 We recognize a restriction on
coverage if an insurer by plain language limits the coverage of
its policy.8 But because of inequities in bargaining power, we
construe coverage broadly and exclusions narrowly, in favor of
insureds.9 To the extent that we deal with issues of first
impression, we adopt the rule most persuasive in light of
precedent, reason, and policy.10
B. The Absolute Pollution Exclusion
One of the most contested and highly litigated issues
in the field of liability insurance is the scope of pollution
exclusion clauses.11 The first standard pollution exclusion was
incorporated in commercial general liability policies in 197012 to
combat adverse selection and reduce moral hazard.13 The original
exclusion, sometimes called the sudden and accidental or
qualified pollution exclusion, contained an exception for
discharge, dispersal, release, or escape [that] . . . is sudden
and accidental.14 Applying Alaska law, three courts construed the
qualified pollution exclusion in favor of policyholders.15
In 1986 regulatory authorities approved a major
expansion in the scope of the pollution exclusion by eliminating
the sudden and accidental exception.16 The revised exclusion is
so broad that it is often termed absolute,17 even though it does
not exclude all pollution-related liability.18
The ANIC policies include Coverage A, covering bodily
injury and property damage, Coverage B, covering personal and
advertising injury, and Coverage C, covering medical payments for
bodily injury. Coverage A contains an absolute pollution
exclusion (subsection 2.f.(1)) excluding property damage arising
out of the actual, alleged or threatened discharge, dispersal,
seepage, migration, release or escape of pollutants. Pollutants
are defined under Coverage A as any solid, liquid, gaseous or
thermal irritant or contaminant, including smoke, vapor, soot,
fumes, acids, alkalis, chemicals and waste. Waste includes
materials to be recycled, reconditioned or reclaimed.
1. The pollution exclusion contained in the ANIC
policies is not ambiguous.
Whittier argues that gasoline is not a pollutant under
the exclusion; it alternatively argues that the exclusion is
ambiguous as to whether it excludes leaked gasoline from
coverage.19 As Whittier notes, when a clause in an insurance
policy is ambiguous, we must accept the interpretation that most
favors the insured.20 But [a]n ambiguity does not exist merely
because the parties disagree as to the interpretation of a term.21
We emphasized in Nelson v. Progressive Casualty Insurance Co.
that ambiguity is only present if inconsistent, but reasonable,
interpretations of the contract are possible.22
Although we have not, before now, had the opportunity
to determine whether the absolute pollution exclusion generally
contained in commercial general liability policies is ambiguous,
numerous jurisdictions have addressed whether leaked gasoline is
a pollutant within the meaning of the policy exclusion. Whittier
relies heavily on two cases determining that the absolute
pollution exclusion was ambiguous.23 Like Whittier, the insured
in the first case, American States Insurance Co. v. Kiger, owned
and operated a gas station, and the absolute pollution exclusion
was almost identical to Whittiers pollution exclusion.24 The
Kiger court held that pollution in regards to the policy was
ambiguous and construed the term against the insurer.25 The court
reasoned that although gasoline is sometimes referred to as a
pollutant, the language of a policy must be explicit to exclude
coverage for damage caused by leakage of gasoline and that the
term pollutant did not obviously include gasoline.26
Whittier also cites Hocker Oil Co. v. Barker-Phillips-
Jackson, Inc.27 Deeming the Kiger courts rationale persuasive,
the Hocker court concluded that the insurers failure to
specifically identify gasoline as a pollutant in its pollution
exclusion resulted in uncertainty and indistinctness, and
therefore held that the policy was ambiguous as to whether
gasoline was a pollutant for purposes of the exclusion.28
But we conclude that the better-reasoned approach is
the one advocated by ANIC and adopted by the majority of courts
that have reviewed a pollution exclusion identical or markedly
similar to the clause in the ANIC policies.29 We hold that there
is no ambiguity because, even though gasoline that is in the UST
is a product for purposes of other parts of the insurance policy,
when the gasoline escapes or reaches a location where it is no
longer a useful product it is fairly considered a pollutant.
2. Whittiers interpretation is unreasonable.
Alaska has adopted the doctrine of reasonable
expectations.30 We can construe an insurance policy under the
reasonable expectations doctrine without finding ambiguity in the
policy; therefore, even though we have determined that the
exclusion is not ambiguous, Whittier may still prevail under the
reasonable expectations doctrine.31 Because an insurance policy
is an adhesion contract, we construe any policy restrictions in
liability policies to give effect to the insureds objectively
reasonable expectations.32 Thus, with regards to liability
policies, the objectively reasonable expectations of applicants
and intended beneficiaries regarding the terms of insurance
contracts will be honored even though painstaking study of the
policy provisions would have negated those expectations.33 Under
this doctrine, we examine the language of the disputed
provisions, other provisions, and relevant extrinsic evidence.34
Whittiers claim is not supported by any of these
sources. As to the language of the disputed policy provision,
Whittier argues that the absence of the term gasoline from the
definition of pollutants in the ANIC policies demonstrates that
ANIC did not intend gasoline to be considered a pollutant. But
because public policy disfavors requiring an exhaustive list of
pollutants in insurance policies35 and the majority of courts
deciding the issue have rejected similar arguments,36 we are
unpersuaded by Whittiers argument.
As to other provisions, Whittier argues that gasoline
was its [u]seful [p]roduct within coverage of the ANIC policies.
But, again, we distinguish between gasoline that is contained in
a UST and available for sale as a gas stations product, and
leaked gasoline that contaminates soil and water as a pollutant.37
Finally, as to extrinsic evidence, Whittier argues that
ANICs underwriting files demonstrate that ANIC was aware of the
potential risks it faced from Whittiers UST[]. Whittier notes
that ANIC requested and obtained Loss Control reports in 1993 and
1996, both of which specifically discussed Whittiers USTs.
Whittier argues that the request for information about the USTs
indicates that ANIC acknowledged that it would be liable for any
loss that arose from the gasoline in the USTs; it alternatively
argues that the reports demonstrate that the policy is ambiguous
as to whether the policy covers damages from UST leaks.
There is no indication that, before the last of the
five policies expired, Whittier had seen or been aware of the
loss control reports. The documents therefore could not have led
Whittier to reasonably expect the ANIC policies would cover
claims that gasoline leaking from the USTs had caused property
damage.
Nor could the reports reasonably give rise to an
inference that the insurer thought there was coverage for claims
arising from gasoline that leaked from USTs. When reviewing a
grant of summary judgment we draw all reasonable inferences in
favor of the non-prevailing party below.38 But it is not
reasonable to infer that ANICs underwriting files, which describe
the USTs as part of a larger description of Whittiers facilities
and do not discuss the likelihood of a UST leak or estimate the
financial risk of a UST leak, could indicate that the ANIC policy
might cover damages stemming from a gasoline leak.39
Moreover, the existence of the information contained in
the loss control reports does not demonstrate that the pollution
exclusion was ambiguous. As ANIC argues, there are other reasons
why ANICs underwriting files would contain notes about Whittiers
USTs, including potential liability risks that a UST could
explode, collapse, or cause the ground to give way suddenly.
ANIC argues that the lawsuits filed against Whittier
demonstrate that gasoline is a pollutant. The private party
complaints specifically charge Whittier with polluting the
neighboring lands. The state complaint seeks costs associated
with the abatement, containment, or removal of the pollutant.
But absent contract language clearly specifying an objective
perspective, our practice is to determine the meaning of a
provision from the perspective of the insureds claiming coverage,
not from that of third-party litigants.40
In line with this practice, ANICs argument that
Whittier knew that the ANIC policies did not cover the damages
from the UST leak is more persuasive. In 1999 Whittier applied
for a Storage Tank System Third Party Liability and Corrective
Action Policy from Zurich. The application asked, Do you
currently have pollution coverage for the tanks applied for on
this application? Whittier answered NO. A partys conduct may be
evidence of its intent even if the conduct arose from a single
instance so long as the conduct evinces an interpretation
contrary to the partys interest.41 Therefore Whittier could not
have reasonably expected that the ANIC policies would cover
damages from a UST gasoline leak.
Because the language of the policies and extrinsic
evidence do not suggest that the parties reasonably believed that
damages stemming from leaked gasoline would be covered under the
ANIC policies, we conclude that the reasonable expectations
doctrine does not assist Whittier.
C. Other Provisions of the Policy Do Not Restore or
Otherwise Provide Coverage.
Whittier argues that even if we determine that the
pollution exclusion unambiguously bars coverage for damages from
leaked gasoline, it may still prevail based on various provisions
of the ANIC policies to which the pollution exclusion does not
apply.
Whittier first argues that ANIC should cover the claims
because Whittier contractually assumed liability for its UST
contractor. It asserts that the exceptions for insured
contract[s] and completed operations apply because of this
assumed liability.
The ANIC policies contain an exclusion for contractual
liability.42 But there is an exception to that exclusion for
damages [a]ssumed in a contract or agreement that is an insured
contract. 43
In February 1995 the state conferred a grant on
Whittier to offset Whittiers cost of installing the new tank.
The states complaint against Whittier asserts that the states
award letter contains an indemnity provision. Whittier therefore
argues that because Whittier agreed to indemnify the state for
the negligence of Whittiers contractor, the contractor was
covered under the insured contract exception.
Whittier also argues that the pollution exclusion does
not apply because the leaked gasoline was the result of the
contractors completed operations. Whittier points to a workbook
issued by the Insurance Services Office, Inc. (ISO), an agent of
ANIC and a company supplying underwriting claims information for
insurance companies; the workbook states that there is coverage
for some off-site emissions, including the Products/Completed
Operations exposure.
Whittiers assumed-liability arguments are unavailing.
The assumption-of-liability exception does not apply because the
state is not being sued. Moreover, there is no coverage under
the products-completed operations hazard provision because an
exclusion explicitly states when it does not apply to the
provision;44 the pollution exclusion does not contain such a
statement. And in any event, an insured cannot create coverage
under a policy containing a pollution exclusion by agreeing to
indemnify a third party for the same risk.45
Whittier next argues that the Churchs trespass claim
should be covered under Coverage B. Coverage B contains a
pollution exclusion worded identically to the exclusion in
Coverage A, excluding [p]ersonal injury or advertising injury
. . . [a]rising out of the actual, alleged or threatened
discharge, dispersal, seepage, migration, release or escape of
pollutants. The definition of pollutants is the same as the
definition under Coverage A. But the pollution exclusion was not
added to Coverage B until 1996. Although the fill pipe did not
break until 1997, Whittier argues that there was no valid
pollution exclusion under Coverage B for any year because ANIC
did not give Whittier advance notice of the change as required by
statute.46
Regardless of whether there was a valid pollution
exclusion added to Coverage B, there is no coverage for the
trespass claims under Coverage B. Whittier argues that the
trespass claim is covered under Coverage B because it arises from
[t]he . . . wrongful entry into . . . premises that a person
occupies by or on behalf of its owner, landlord or lessor. But
Whittier is not the owner, landlord, or lessor of the Churchs
property; Coverage B applies to landlord-tenant situations.47
And, because accepting Whittiers interpretation of Coverage B
would render the pollution exclusion in Coverage A meaningless,
we are persuaded by the reasoning of other courts rejecting
similar attempts to use Coverage B to evade the pollution
exclusion in Coverage A.48
Finally, Whittier argues that there is coverage under
an exception for liability Whittier would have in the absence of
government-required cleanup. Subsection f.(1) of the pollution
exclusion, as discussed above, excludes from coverage all
liability for [b]odily injury or property damage arising from
pollutants; subsection f.(2) separately excludes coverage for
loss, cost or expense arising out of any governmental cleanup
orders or claims. Whittier asserts that a paragraph following
f.(2) and stating that this paragraph does not apply to liability
. . . the insured would have in the absence of such request
applies with equal force to except the claims against Whittier
from the exclusion in f.(1). We disagree. If an exception
restores coverage, the coverage remains subject to the limitation
of each and every exclusion;49 therefore, the pollution exclusion
in f.(1) still bars coverage for bodily injury or property damage
stemming from pollution.50
IV. CONCLUSION
Because the pollution exclusion unambiguously excludes
leaked gasoline from coverage and the other policy provisions do
not restore or otherwise provide coverage, we AFFIRM the judgment
below.
_______________________________
1 Policy 96E PS 54321 was effective May 29, 1996 to May
29, 1997; Policy 97E PS 54321 was effective May 29, 1997 to May
29, 1998; Policy 98E PS 54321was effective May 29, 1998 to May
29, 1999; Policy 99E PS 54321was effective May 29, 1999 to May
29, 2000; and Policy 00E PS 54321 was effective May 29, 2000 to
May 29, 2001.
2 The Zurich policy was the subject of unrelated
litigation brought against Whittier in 2004 arising from the same
leaked gasoline at issue in this case. See Zurich Am. Ins. Co.
v. Whittier Props. Inc., 356 F.3d 1132 (9th Cir. 2004).
3 Morgan v. Fortis Benefits Ins. Co., 107 P.3d 267, 269
(Alaska 2005) (affirming grant of summary judgment to insurer
because claimants death fell under policys intoxication
exclusion).
4 Id.
5 Nelson v. Progressive Cas. Ins. Co., 162 P.3d 1228,
1231 (Alaska 2007) (affirming grant of partial summary judgment
after deciding that named driver exclusion was unambiguous and
barred coverage for pedestrians negligent entrustment claim).
6 Id.
7 C.P. ex rel. M.L. v. Allstate Ins. Co., 996 P.2d 1216,
1222 (Alaska 2000).
8 Id.
9 Hahn v. Alaska Title Guar. Co., 557 P.2d 143, 144-45
(Alaska 1976) (construing definition of record in insurance
policy broadly in favor of insureds to include public land order
filed with Federal Register).
10 Govt Employees Ins. Co. v. Graham-Gonzalez, 107 P.3d
279, 284 (Alaska 2005) (holding that statute requiring that
insurers shall offer underinsured motorist coverage did not
require that application forms also state amount of premium).
11 Kenneth S. Abraham, Environmental Liability Insurance
Law 145 (1991).
12 Donald S. Malecki & Arthur L. Flitner, Commercial
General Liability 40 (7th ed. 2001). Insurers began issuing a
standard comprehensive general liabilitypolicy in 1940. 9A Lee
R. Russ & Thomas F. Segalla, Couch on Insurance 129:1, at 129-5
(3d ed. 2005). In 1986 the standard policy became a commercial
general liability policy. Id.
13 Abraham, supra note 11, at 152-53; see Douglass
Farnsworth, Moral Hazard in Health Insurance: Are Consumer-
Directed Plans the Answer?, 15 Annals Health L. 251, 253 (2006)
(Moral hazard, simply put, is the tendency of an individual to
behave differently in regards to a particular event depending on
the presence of insurance.); Peter Siegelman, Adverse Selection
in Insurance Markets: An Exaggerated Threat, 113 Yale L.J. 1223,
1223 (2004) (The phrase adverse selection was originally coined
by insurers to describe the process by which insureds utilize
private information of their own riskiness when deciding to buy
or forgo insurance.).
14 See generally Sauer v. Home Indem. Co., 841 P.2d 176,
179 n.3 (Alaska 1992).
15 Id. at 181-82 n.8 (declining to rule definitively on
language in pollution exclusion but noting variety of
interpretations among other jurisdictions, and holding that
discharge from sewage leak that occurred over several days or a
few weeks was arguably sudden and accidental); Mapco Express,
Inc. v. Am. Intl Speciality Lines Ins. Co., No. 3AN-95-8309
(Alaska Super. July 31, 1998) (determining that sudden is
ambiguous and must be construed in favor of policyholder); see
also Mapco Alaska Petroleum, Inc. v. Cent. Natl Ins. Co. of
Omaha, 795 F. Supp. 941, 947 (D. Alaska 1991) (concluding that
summary judgment was inappropriate because whether groundwater
contamination that occurred without notice was sudden and
accidental was question of fact).
16 Abraham, supra note 11, at 160-61.
17 Id. at 161.
18 Id. (For example, certain kinds of liabilities clearly
are not mentioned within the exclusion. Most prominent among
these is liability for pollution caused by finished products in
the possession of others . . . . In addition, the meaning of a
number of terms in the exclusion is unclear.).
19 As an initial matter, in all of its arguments Whittier
asserts that [b]ecause there was at least a possibility of
insurance coverage, the trial court should have agreed with
Whittier that ANIC was estopped from asserting any coverage
defenses when it refused to provide Whittier with any defense.
But the possibility of coverage is irrelevant; the question here
turns on contract interpretation. [A] duty to defend does not
arise whenever an insurer and an insured have a dispute over
coverage. Makarka v. Great Am. Ins. Co., 14 P.3d 964, 969-70
(Alaska 2000) (stating that where coverage turns solely on the
interpretation of policy language that has never been reviewed by
this court, that fact alone is not enough to create a possibility
of coverage that required a defense).
20 West v. Umialik Ins. Co., 8 P.3d 1135, 1138 (Alaska
2000); Starry v. Horace Mann Ins. Co., 649 P.2d 937, 939 (Alaska
1982).
21 C.P. ex rel. M.L., 996 P.2d at 1222 n.38 (citing Modern
Constr., Inc. v. Barce Inc., 556 P.2d 528, 529 (Alaska 1976));
accord Jarvis v. Aetna Cas. & Sur. Co., 633 P.2d 1359, 1363
(Alaska 1981).
22 Nelson v. Progressive Cas. Ins. Co., 162 P.3d 1228,
1234 (Alaska 2007).
23 To the extent Whittier contends or seems to be
contending that loss control reports requested and obtained by
ANIC were extrinsic evidence bearing on whether the policies
exclusion was ambiguous or must, in any event, be interpreted in
the insureds favor, we address the loss control reports in Part
III.B.2.
24 Am. States Ins. Co. v. Kiger, 662 N.E.2d 945, 948 (Ind.
1996).
25 Id. at 949.
26 Id.
27 Hocker Oil Co. v. Barker-Phillips-Jackson, Inc., 997
S.W.2d 510 (Mo. App. 1999).
28 Id. at 518.
29 As the Complex Insurance Claims Litigation Association
states in its amicus curiae brief, [o]ver 100 appellate court
cases and 36 jurisdictions have ruled that pollution exclusions
like the one at issue here unambiguously bar coverage for harms
caused by exposure to many different types of pollutants. See
Deni Assocs. of Fla. Inc. v. State Farm Fire & Cas. Ins. Co., 711
So. 2d 1135, 1137 n.2 (Fla. 1998) (noting 100 cases and thirty-
six jurisdictions had held pollution exclusion not ambiguous);
Quadrant Corp. v. Am. States Ins. Co., 110 P.3d 733, 738 (Wash.
2005) (listing cases); see, e.g., Heyman Assocs. No. 1 v. Ins.
Co., 653 A.2d 122, 132-33 (Conn. 1995) (absolute pollution
exclusion unambiguous and spilled fuel is pollutant); Millers
Mut. Ins. Assn v. Graham Oil Co., 668 N.E.2d 223, 229 (Ill. App.
1996) (gasoline that migrated from storage tank to neighbors
subsoil is pollutant); Harrison v. R.R. Morrison & Son, Inc., 862
So. 2d 1065, 1072 (La. App. 2003) (pollution exclusion
unambiguous and gasoline is pollutant).
30 West, 8 P.3d at 1138.
31 Nelson, 162 P.3d at 1235 (citing West, 8 P.3d at 1138).
32 Id. (holding that named driver exclusion was valid
exception to statutorily mandated liability coverage).
33 Bering Strait Sch. Dist. v. RLI Ins. Co., 873 P.2d
1292, 1295 (Alaska 1994) (citing Robert Keeton, Basic Text on
Insurance Law 6.3(a), at 351 (1971)).
34 Nelson, 162 P.3d at 1235 (quoting Williams v. Crawford,
982 P.2d 250, 253 (Alaska 1999)).
35 See Harnischfeger Corp. v. Harbor Ins. Co., 927 F.2d
974, 976 (7th Cir. 1991):
Drafters cannot anticipate all possible
interactions of fact and text, and if they
could the attempt to cope with them in
advance would leave behind a contract more
like a federal procurement manual than like a
traditional insurance policy. Insureds would
not be made better off in the process. The
resulting contract would be not only
incomprehensible but also more expensive.
36 See, e.g., Truitt Oil & Gas Co. v. Ranger Ins. Co., 498
S.E.2d 572, 574 (Ga. App. 1998) (noting that usual significance
of words used in policy exclusion rendered it unnecessary for
gasoline to be specifically listed as pollutant).
37 See, e.g., id. at 574 (determining that although
gasoline was specifically referred to as insureds product, court
was not required to conclude that leaked gasoline was not a
pollutant); Crescent Oil Co. v. Federated Mut. Ins. Co., 888 P.2d
869, 872-73 (Kan. App. 1995) (mentioning that leaking gasoline
was not insureds product).
38 Morgan v. Fortis Benefits Ins. Co., 107 P.3d 267, 269
(Alaska 2005).
39 See Holland v. Union Oil Co., 993 P.2d 1026, 1031-32
(Alaska 1999) (inference of just cause employment relationship
not reasonable from one-page document merely addressing potential
behavior problems because no reasonable juror could draw that
inference).
40 C.P. ex rel. M.L. v. Allstate Ins. Co., 996 P.2d 1216,
1223 (Alaska 2000).
41 See Peterson v. Wirum, 625 P.2d 866, 872-73 (Alaska
1981) (determining that Petersons conduct after loan fell through
including agreeing to look for other loan providers and
expressing interest in loaning money herself demonstrated that,
contrary to her litigation position, Peterson understood that
loan provision was not condition precedent); Australaska Corp. v.
Sisters of Charity of House of Providence, 397 P.2d 966, 968
(Alaska 1965) (interpreting warranty clause against corporation
whose president expressed during deposition interpretation
consistent with opposing partys interpretation). But see
Sprucewood Inv. Corp. v. Alaska Hous. Fin. Corp., 33 P.3d 1156,
1163-64 (Alaska 2001) (determining that evidence of AHFCs own
employees concessions that contract did not specify how buildings
were to be demolished was insufficient to challenge trial court
finding that AHFC believed, at time of formation, that contract
required complete destruction of buildings rather than removal
and sale when employees also testified that contract required
buildings to be broken up).
42 That exclusion states: This insurance does not apply to
. . . [b]odily injury or property damage for which the insured is
obligated to pay damages by reason of the assumption of liability
in a contract or agreement.
43 An insured contract is defined in part as:
That part of any other contract or agreement
pertaining to your business (including an
indemnification of a municipality in
connection with work performed for a
municipality) under which you assume the tort
liability of another party to pay for bodily
injury or property damage to a third person
or organization. Tort liability means a
liability that would be imposed by law in the
absence of any contract or agreement.
44 For example, the exclusion for Damage to Property under
Coverage A states that Paragraph (6) of this exclusion does not
apply to property damage included in the products-completed
operations hazard.
45 See Capital Alliance Ins. Co. v. Cartwright, 512 S.E.2d
666, 668 (Ga. App. 1999) (in indemnification suit by third party
who contracted with insured so that insured would indemnify third
party, court determined that injury arose from risk excluded by
policy and thus was likewise excluded by policy).
46 AS 21.36.235(a) requires that if after renewal there
will be a material restriction or reduction in coverage not
specifically requested by the insured, written notice shall be
mailed to the insured and to the agent or broker of record as
required by AS 21.36.260 . . . at least 45 days before expiration
of a business or commercial policy. See also AS 21.36.235(b),
which requires that the existing policy shall continue until the
insurer provides notice for the time period required by (a) of
this section for that policy.
47 See, e.g., U.S. Fid. & Guar. Co. v. Goodwin, 950 F.
Supp. 24, 27 (D. Me. 1996) (determining that, because personal
injury provision unambiguously requires that the wrongful entry
be committed by the owner, landlord, or lessor of the room,
dwelling, or premises, insureds trespass on neighbors property
when cutting trees was outside personal injury coverage).
48 See, e.g., Lakeside Non-Ferrous Metals, Inc. v. Hanover
Ins. Co., 172 F.3d 702, 705-06 (9th Cir. 1999) (stating that
allowing insured to recast its claim under personal injury
provision would render[] the pollution exclusion a dead appendage
to the policy (quoting Titan Corp. v. Aetna Cas. & Sur. Co., 27
Cal. Rptr. 2d 476, 486 (Cal. App. 1994))).
49 Stillwater Condo. Assn v. Am. Home Assurance Co., 508
F. Supp. 1075, 1079 (D. Mont. 1981); accord Weedo v. Stone-E-
Brick, Inc., 405 A.2d 788, 795 (N.J. 1979) (If any one exclusion
applies there should be no coverage, regardless of inferences
that might be argued on the basis of exceptions or qualifications
contained in other exclusions.).
50 Because we affirm the superior courts grant of summary
judgment to ANIC, we do not need to address Whittiers argument
that the court erred in granting summary judgment to ANIC on
Whittiers bad faith claim.
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| Case Law Statutes, Regs & Rules Constitutions Miscellaneous |
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