Opinion ID: 2634716
Heading Depth: 4
Heading Rank: 1

Heading: The Compass Decision

Text: Under our holding and reasoning in Compass, an expectation of seepage is not determinative of whether qualified pollution exclusion clauses preclude coverage. In Compass, we implicitly acknowledged that seepage from unlined landfills is not necessarily a relevant polluting event. First, we explained that in the past, unlined disposal areas often operated with the expectation that the underlying soils would filter contaminants. [6] Second, our holdingthat unlined disposal areas constituted containment areasalone requires us to view seepage from the ponds not as a polluting event but part of a larger containment process. Therefore, we conclude that the court of appeals erred by viewing Cotter's expectation of seepage as determinative of coverage. Through our reasoning in Compass, we viewed seepage from unlined ponds as part of a larger containment process and thus not as a relevant polluting event. In Compass, we concluded that the placement of wastes in unlined landfills is not a relevant polluting event because unlined landfills were understood to contain contaminants by filtering them through the underlying soil. Compass, 984 P.2d at 616-18. In reaching this conclusion, we agreed with the analysis set forth in Queen City Farms, Inc. v. Central National Insurance Co. 126 Wash.2d 50, 882 P.2d 703 (1994). There, the Supreme Court of Washington considered unlined landfills to be containment areas for purposes of the qualified pollution exclusion clause. See id. at 718-19. The court reasoned that unlined landfills were expected to contain pollutants by allowing the soil beneath landfills to filter contaminants before such contaminants reached groundwater. The court explained: When landfills began to be licensed in the late 1960s and early 1970s, landfill operators and even many environmental officials expected the design of a landfill would function to contain pollutants. In particular, the soil beneath landfills was expected to act as a filter to prevent pollutants from migrating into the underlying and surrounding ground and surface waters. Id. at 719 (quoting Sylvester Bros. Dev. Co. v. Great Cent. Ins. Co., 480 N.W.2d 368, 373-74 (Minn.Ct.App.1992)). Because unlined landfills were expected to contain contaminants through filtration, we concluded in Compass, like the Queen City Farms court, that unlined landfills could constitute containment areas for the purpose of qualified pollution exclusion clauses. Our decision in Compass therefore was based on an understanding that unlined disposal areas were expected to contain contaminants by allowing them to filter through the underlying soil before they reached the groundwater. Because we accounted for such seepage when determining that unlined disposal areas constituted containment areas in Compass, we interpret this reasoning as implicitly acknowledging that seepage from wastes placed in unlined disposal areas may not constitute a relevant polluting event. Even though we acknowledged through our reasoning in Compass that seepage from wastes placed in unlined disposal areas may not constitute a relevant polluting event, our holding alone in that case compels the same conclusion. Because we held that unlined disposal areas constitute containment areas, and that the placement of wastes in such disposal areas are not relevant polluting events, we cannot now sever the natural and inevitable seepage of contaminants into the soil beneath disposal areas by classifying seepage as an independent polluting event. Such a classification would suggest that unlined landfills somehow prevented contaminants from seeping into the soil beneath landfillseffectively suggesting that unlined landfills functioned like lined landfills. By characterizing unlined landfills as containment areas, we did not operate under a fiction that topsoil in landfills created an impermeable layer to contain pollutants. Rather, in Compass, we viewed the placement of wastes into unlined disposal areas and the natural seepage of wastes not as severable, but rather as part of a larger containment process. Thus, we view the holding and rationale of Compass as acknowledging that seepage from unlined disposal areas does not necessarily constitute a relevant polluting event. For this reason, an expectation of seepage does not establish whether or not qualified pollution exclusion clauses preclude coverage. Therefore, we conclude that the court of appeals erred by holding that the qualified pollution exclusion clauses precluded coverage solely because Cotter expected seepage from the ponds.