Opinion ID: 993400
Heading Depth: 2
Heading Rank: 2

Heading: Liability for the Rice Planters Clean-up.

Text: The district court also granted summary judgment with respect to Federated's argument that it had no liability to Dilmar on DHEC's ordered clean-up of the Rice Planters restaurant site, holding that there was no claim during any applicable policy period. There needed to be a demand from DHEC to Dilmar during an applicable policy period because the relevant contract provision, Insuring Agreement 2, requires Federated to cover costs that the insured incurs because of a governmental demand asserted under statutory authority. Dilmar argues that the court was incorrect because DHEC's demand with respect to Rice Planters, made on June 30, 1994, was merely a continuation of Dilmar's previous claim for the Northside Texaco site, which DHEC said was the most probable source of contamination at Rice Planters. Because Dilmar voluntarily investigated the Northside Texaco site in the Spring of 1989, during its initial SUPERB Act-inspired investigations, reported it, and began remediating it at that time, Dilmar claims that Insuring Agreement 3 applies. That provision covers reimbursement for costs associated with voluntarily initiated clean-up programs. The mere fact that DHEC later wrote Dilmar requesting that it clean up the contamination from that site which spread to an adjoining property does not relieve Federated of its existing duty to cover the costs. Dilmar's claims are incorrect. DHEC's order to clean up the Rice Planters site constituted a government mandate triggering Insuring 8 Agreement 2. This government mandate was only received in June 1994, however, four years after the last Federated policy expired. And this ordered clean-up was not a continuation of an earlier voluntary clean-up claim. Dilmar is attempting to bootstrap the Rice Planters claim onto the earlier voluntary clean-up coverage for the Northside Texaco site under Agreement 3. First, the language of the insurance contract is unambiguous: the insuring agreements are mutually exclusive and provide coverage for three distinct events. Allowing a claim triggering one insuring agreement to implicate coverage under one of the other insuring agreements would torture the clear and unambiguous policy language and extend coverage that was never intended by Federated. Next, the policy provides no coverage for the Rice Planters claim. It says that coverage for the Rice Planters claim, if it exists, is only under Insuring Agreement 2, providing coverage for reimbursement of government-mandated clean-up costs. This agreement requires that [n]otice asserting such obligation must first be received by [the insured] during the policy period. DHEC only mandated clean-up in June 1994, well after the policy period. Dilmar attempts to argue that this is covered by Insuring Agreement 3, but it must show that the Rice Planters site was to have been included in the voluntary clean-up Dilmar was conducting at Northside Texaco. When Dilmar submitted its 1989 claim for Northside Texaco, however, only Agreement 3 was implicated because there was no government or third party demand made of Dilmar. The proposed clean-up at Rice Planters is not voluntary--DHEC ordered it. It does not matter whether the contamination at Rice Planters is from Northside Texaco; the dispositive issue is whether the clean-up is being conducted voluntarily. Insuring Agreement 3 only applies to voluntary clean-up cost reimbursement, not to government-ordered clean-up, as is the case here. Allowing Dilmar to obtain coverage for a government-mandated clean-up under the insuring agreement providing coverage for voluntary clean-up costs incurred would render Insuring Agreement 2 a nullity. The district court was thus correct to grant summary judgment for Federated on Dilmar's demand for coverage of the Rice Planters clean-up. 9