Opinion ID: 1498440
Heading Depth: 1
Heading Rank: 1

Heading: Overruling Minerva

Text: State Auto first contends on appeal that this court's decision in Minerva Enterprises, Inc. v. Bituminous Casualty Corp., supra , and the court of appeals's decision in Anderson Gas & Propane, Inc. v. Westport Ins. Corp., supra , were wrongly decided. We disagree. In support of its argument, State Auto points to the pertinent provisions in its insurance contracts. The State Auto liability policy first provides the following pollution exclusion under Section I, which covers bodily injury and property liability damage: 2. Exclusions This insurance does not apply to: . . . . f. Pollution (1) Bodily injury or property damage arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of pollutants: (a) At or from any premises, site or location which is or was at any time owned or occupied by, or rented or loaned to, any insured.... The policy next defines pollutants as follows: 15. Pollutants mean 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. State Auto points out that both Minerva and Anderson stand for the proposition that any ambiguity inherent in the pollution-exclusion clause must be resolved on remand by the fact-finder. According to State Auto, the Minerva and Anderson decisions should be overturned for three reasons. It argues, initially, that this court ignored the fundamental principle of insurance-policy construction, which is to give effect to the plain policy language and avoid a construction that neutralizes provisions of the policy. State Auto points out that pollutants are defined under the policy as any ... irritant or contaminant. Gasoline, it maintains, clearly falls within that definition. The second error State Auto asserts is that in Minerva , this court speculated about the intent of the drafters of the insurance policy. State Auto offers that this error lies at the heart of the Minerva opinion. State Auto specifically refers to this court's reliance on Molton, Allen and Williams, Inc. v. St. Paul Fire & Marine Insurance Co., 347 So.2d 95 (Ala.1977), which it says this court believed was followed by a majority of courts at the time it handed down its decision in Minerva . The most obvious defect in Molton , according to State Auto, is that the Molton court ignored the plain language of the exclusion. Further, State Auto points to what it considers to be a defect in both Molton and Minerva , which is that both courts concluded that the listed examples of pollutants in the exclusion are all related to industrial waste. Minerva, 312 Ark. at 134, 851 S.W.2d at 406. The third way in which State Auto asserts that the Minerva court erred is in its misapplication of the legal rule of ejusdem generis. According to State Auto, in the exclusion, the words any ... irritant or contaminant, precede the more specific words smoke, vapor, soot, fumes, acids, alkalis, chemicals, and waste. State Auto claims that this is the reverse of the basis for applying the ejusdem generis rule and that generally, when applying that rule, the catch-all words follow the more specific examples. State Auto further maintains that the Anderson decision of the Arkansas Court of Appeals compounded the errors of the Minerva opinion. According to State Auto, the Anderson court conjured up an ambiguity that did not exist when it held that the policy failed to include the term gasoline. State Auto contends that the court of appeals further erred by imagining a second ambiguity, when it asserted that the terms `irritant' or `contaminant' can reasonably be construed as including `gasoline' or not including it. 84 Ark.App. at 318, 140 S.W.3d at 508-09. [1] This court has long held that there is a strong presumption in favor of the validity of prior decisions. See, e.g., Cochran v. Bentley, 369 Ark. 159, 251 S.W.3d 253 (2007). In Cochran , we said: [I]t is necessary, as a matter of public policy, to uphold prior decisions unless great injury or injustice would result. The policy behind stare decisis is to lend predictability and stability to the law. In matters of practice, adherence by a court to its own decisions is necessary and proper for the regularity and uniformity of practice, and that litigants may know with certainty the rules by which they must be governed in the conducting of their cases. Precedent governs until it gives a result so patently wrong, so manifestly unjust, that a break becomes unavoidable. Id. at 174, 251 S.W.3d at 265 (internal citations omitted). In Minerva , this court was called on to interpret a pollution-exclusion provision similar to the one in the instant case. In that case, a mobile home park's septic system backed up in a tenant's home. The Minerva policy defined pollutants 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. Minerva, 312 Ark. at 130, 851 S.W.2d at 404. One of the arguments made by the insured in that case was that the definition of pollutants was intended to exclude only industrial waste, and not common household wastes. At best, the insured contended that the definition was ambiguous. This court agreed that the definition of pollutants was ambiguous and relied on what it considered to be the leading case at that time, the Alabama Supreme Court's decision in Molton, Allen and Williams, Inc., supra . In its conclusion in Minerva , this court found that the pollution exclusion was ambiguous, as it was not clear that having only a single back-up septic tank in a mobile home that overflowed was necessarily the type of accident the pollution-exclusion clause was intended to exclude. This court added that under the rule of ejusdem generis, the term waste was the catch-all word which must be considered within the context of the entire list, which included pollutants related to industrial waste. This court further noted that the initial determination of the existence of an ambiguity rests with the court. Where an ambiguity exists, parol evidence is then admissible and the meaning of the ambiguous terms becomes a question of fact for the fact-finder to resolve. We remanded for the circuit court to enter a judgment consistent with our opinion. The question now before us in the case at hand is whether this court erred in determining that the policy language in Minerva was ambiguous. We conclude that we did not err, despite the fact that State Auto now argues that the majority of jurisdictions hold that no ambiguity exists in a pollution exclusion containing similar language to that found in the instant case. In short, this court continues to believe that the pollution-exclusion language is subject to different interpretations. State Auto also urges that this court incorrectly speculated about the intent of the drafters of the insurance policy. We disagree that this court speculated on the intent of the drafters in Minerva in determining that an ambiguity existed. In Minerva , this court concluded that [t]he initial determination of the existence of an ambiguity rests with the court, and if ambiguity exists, then parol evidence is admissible and the meaning of the ambiguous terms becomes a question for the fact-finder. 312 Ark. at 134, 851 S.W.2d at 406. Once found, consideration of pertinent parol or extrinsic evidence by the fact-finder is necessary to resolve the ambiguity. The intent of the drafters is not relevant to this process. Rather, the language of the policy and how it can be read, using the canons of construction and extrinsic evidence, if necessary, is what we rely on. We hold that State Auto did not meet its burden of proving that this court should break from its rule of stare decisis and overrule its decision in Minerva or the court of appeals's decision in Anderson . We agree with the Burch Trust that State Auto has not shown how the result in Minerva is so patently wrong and unjust that a break from precedent is unavoidable. Accordingly, we decline to overrule our decision in Minerva or the court of appeals's decision in Anderson .