Opinion ID: 2617139
Heading Depth: 1
Heading Rank: 3

Heading: Analysis of Certified Question

Text: As we have noted at the outset of this opinion, the question we have been asked to answer is as follows: Whether the claims against Kitsap County [for trespass, nuisance, and interference with use and enjoyment of property] constitute `personal injury' under each of the subject liability insurance policies. Doc. 603 at App. A. In providing an answer to the question we recognize that when a federal court certifies a question to this court, this court answers only the discrete question that is certified and lacks jurisdiction to go beyond the question presented. Louisiana-Pacific Corp. v. Asarco Inc., 131 Wash.2d 587, 604, 934 P.2d 685 (1997). Kitsap County contends that we should answer this question in the affirmative. The insurers assert, on the other hand, that the claims the plaintiffs made against Kitsap County in the three suits that resulted in settlement do not fall within personal injury coverage of the various policies. The County and the insurers [9] make numerous arguments in support of their respective positions and we discuss these arguments hereafter.
Although the County and the insurers agree that this court has not addressed the precise issue presented by the certified question, the insurers assert generally that courts applying Washington law are in accord with the overwhelming majority of courts nationwide in rejecting efforts by policyholders to obtain personal injury coverage for damage to health and property from pollution. Br. of Certain Insurers at 20. The insurers, however, cite only one appellate court decision, Morton Int'l, Inc. v. Aetna Cas. & Sur. Co., 106 Ohio App.3d 653, 666 N.E.2d 1163 (1995), in which Washington law was controlling. [10] As the County points out, however, the court in Morton simply adopted the reasoning of the New York Court of Appeals in County of Columbia v. Continental Ins. Co., 83 N.Y.2d 618, 634 N.E.2d 946, 612 N.Y.S.2d 345 (1994), without substantial analysis. [11] Furthermore, even though County of Columbia stands for the proposition that the personal injury provisions in the policy under review there only provided coverage for intentional acts, its principal holding was that where the pollution exclusion bars coverage for property damage, coverage is not available for the property damage even if it arose from personal injury claims. That issue, as we discuss later, is not squarely presented by the certified question and, thus, we do not address it. The other cases from around the nation that are cited by the insurers may be divided into two categories. The first category of cases are those which, according to the insurers, pronounce that applying personal injury coverage to environmental contamination claims simply cannot be squared with the overall structure of the policy. Br. of Certain Insurers at 20. Insurers cite only three cases to support this argument, two of which are published decisions of federal trial courts. Whiteville Oil Co. v. Federated Mut. Ins. Co., 889 F.Supp. 241 (E.D.N.C.1995), aff'd, 87 F.3d 1310 (4th Cir.1996); Kruger Commodities, Inc. v. United States Fidelity & Guar., 923 F.Supp. 1474 (M.D.Ala.1996). These opinions as well as the one appellate decision they cite, Gregory v. Tennessee Gas Pipeline Co., 948 F.2d 203 (5th Cir.1991), are not particularly helpful because the personal injury coverage there was much more limited than the coverage provided here. In Gregory, for instance, the policy before that court only covered a personal injury arising from a [w]rongful entry into, or eviction of a person from, a room, dwelling or premises that the person occupies. Gregory, 948 F.2d at 206. Similarly, in Whiteville and Kruger, the coverage provided by the policies before those trial courts was for injury arising from wrongful eviction from, wrongful entry into, or invasion of the right of private occupancy of a room, dwelling or premises that a person occupies by or on behalf of its owner, landlord or lessor. Whiteville, 889 F.Supp. at 245; Kruger, 923 F.Supp. at 1480. [12] The other category of cases cited by insurers are cases that hold that coverage for trespass, nuisance or other personal injury claims that result in property damage are barred by an absolute pollution exclusion. See J. Josephson, Inc. v. Crum & Forster Ins. Co., 293 N.J.Super. 170, 679 A.2d 1206 (1996). Although we do not necessarily disagree with that view, as we have already noted above, that issue is not before us.
The insurers contend that even if personal injury damages arising from the torts of trespass, nuisance, and interference fall within the personal injury coverage of the policies provided to Kitsap County, coverage is precluded under the personal injury provisions of the policies because the essential character of the plaintiffs' claims against the County, recovery for damages to health and property caused by exposure to pollutants, governs coverage. To allow characterization of the claim in the complaint to govern coverage, the insurers argue, is to elevate the form of the underlying pleadings over their substance. Br. of Certain Insurers at 30. Kitsap County counters this argument by citing cases from other jurisdictions which stand for the proposition that in determining whether coverage is afforded by the personal injury provisions of a policy, one must look to the type of offense that the insured is alleged to have committed and not the nature of the damages sought in the action. Martin Marietta Corp. v. Insurance Co., 40 Cal.App.4th 1113, 47 Cal.Rptr.2d 670, 676, 677 (1995), review denied (1996); see generally 7A JOHN ALAN APPLEMAN, INSURANCE LAW AND PRACTICE § 4501.14 (Walter F. Berdal ed., 1979). The County calls particular attention to Great Northern Nekoosa Corp. v. Aetna Cas. & Sur. Co., 921 F.Supp. 401, 416 (N.D.Miss.1996), in which the court said, Personal injury liability is a theory-based insurance coverage. It defines its coverage in terms of offenses, or theories of liability, not in terms of the injury sustained by the plaintiff. In contrast, the County contends, one must look to the nature of the injury or damage sustained by the claimant who is suing the insured in order to determine if coverage is available under the bodily injury and property damage provisions of a policy. Great Northern, 921 F.Supp. at 416. While there is apparently no published decision from a court in this state which addresses whether personal injury coverage is dependent on the theory underlying the claim or the nature of the injury that is alleged, we are inclined to agree with the courts in other jurisdictions that in determining whether personal injury coverage exists we must look to the type of offense that is alleged. Here, all of the parties who sued Kitsap County claimed that their damages arose from actions of the County which constituted a trespass and/or nuisance. Some claimed, in addition, that the County interfered with their use and enjoyment of their property. If those claims are analogous to claims for the offenses of wrongful entry, wrongful eviction, or other invasion of the right of private occupancy then there is coverage under the personal injury provisions of the policies in question unless coverage is excluded by other provisions in the policy. A determination of whether the County committed any of the offenses would, of course, ultimately determine the obligation of any insurer to pay. That would be a factual determination for the federal court and is not an issue before us.
The insurers also contend that if the County is permitted to obtain coverage for pollution-related damage under the personal injury provisions in the various policies issued to it, while at the same time it asserts that it is covered under the property damage or bodily injury provision of the policy, it will improperly result in the County receiving coverage under two different parts of the policy for the same allegations. Br. of Certain Insurers at 15-16. Such a construction of the policy language, they argue, would be inconsistent with the general principle that the court is to give independent effect to each provision in the policy. Although the insurers cite Weedo v. Stone-E-Brick, Inc., 81 N.J. 233, 405 A.2d 788 (1979), in support of this argument, the portion of the Weedo opinion that they refer to in their brief is not on point. Br. of Certain Insurers at 16 n. 6. The Weedo court was merely discussing the general rule of construction that courts employ when they are faced with ambiguities in an insurance contract. It merely said that no amount of semantical ingenuity can be brought to bear on a fire insurance policy so as to afford coverage for an intersection collision. Weedo, 405 A.2d at 795. While we agree that an average purchaser of insurance, such as the hypothetical purchase in the Weedo court's example, may not reasonably expect coverage that is distinct from that to which the policy applies, it cannot be said that such a purchaser would be confused by the boundaries of the coverage provided here simply because there is overlapping coverage. There is, in short, no rule of law that we are aware of that prevents an insurance company from providing overlapping coverage in any policy that it issues. By the same token, we know of no authority for the proposition that an insured must elect which coverage it chooses if it has been furnished with overlapping coverage in a policy. Any insurer that is a party to this suit provided the coverage that can be ascertained from a plain reading of its entire policy or policies. If the claims against Kitsap County constitute personal injury as that term is defined in any policy, then coverage is available under that policy, notwithstanding the fact that additional coverage may be provided to the insured by other provisions in the policy.
The insurers contend, additionally, that the personal injury coverage provided in the policies in question covers a type f conduct that is far removed from that alleged here. Br. of Certain Insurers at 17. Specifically, they assert that because each offense that is listed in the three groups of offenses set forth in the personal injury coverage provisions involves an intentional but intangible injury of a personal nature (e.g., damage to reputation from defamation, deprivation of the liberty interest from false imprisonment, etc.), it cannot include an action to recover for environmental pollution even if the claim falls within a claim for trespass, nuisance, or interference. Br. of Certain Insurers at 17. Even if we assume, as the insurers aver, that the gravamen of the claims that were made against the County were for bodily injury or property damage caused by an occurrence, the hallmark of which is an accident ... an `unusual, unexpected, and unforeseen happening,' the argument fails. Br. of Certain Insurers at 17 (citation omitted). That is so because, as we explain hereafter, the insurers' assertion that the offenses listed in the personal injury coverage involve intentionally inflicted injury does not hold up. The insurers' first argument in support of that proposition is that because the term offenses is used in the personal coverage provisions, it is axiomatic that only intentional acts are covered. The insurers are incorrect. Although the term offenses is apparently not defined in any of the policies, one dictionary definition of offense is an act of breaking the law; sin; crime; transgression. Reply Br. of PI. at 23 (quoting WEBSTER'S DELUXE UNABRIDGED DICTIONARY 1242 (2d ed.1979)). In Webster's Third New International Dictionary 1566 (3d ed.1986), that word is similarly defined as a sin, transgression, misdeed, and an infraction of law. As Kitsap County correctly observes, there are many laws that one may violate without intending to do so. In our judgment, the meaning that the insurers would subscribe to the term offenses is not one that would occur to an average purchaser of insurance. The insurers' other argument is that because all of the enumerated offenses in groups A, B, and C of the personal injury coverage are intentional torts, it follows that only intentional torts are covered. This argument also fails because all of the enumerated offenses are not intentional torts. We have held, for example, that a private figure need only show negligence on the part of a defendant in order to maintain a defamation action. LaMon v. Butler, 112 Wash.2d 193, 770 P.2d 1027 (1989). In reaching the conclusion that the personal injury provisions are not limited to intentional acts, we are not unmindful that the New York Court of Appeals reached a different conclusion in County of Columbia v. Continental Ins. Co., 83 N.Y.2d 618, 634 N.E.2d 946, 612 N.Y.S.2d 345 (1994). In that case the court held: that the coverage under the personal injury endorsement provision in question was intended to reach only purposeful acts undertaken by the insured or its agents. Evidence that only purposeful acts were to fall within the purview of the personal injury endorsement is provided, in part, by examining the types of torts enumerated in the endorsement in addition to wrongful entry, eviction and invasion: false arrest, detention, imprisonment, malicious prosecution, defamation and invasion of privacy by publication. Read in the context of these other enumerated torts, the provision here could not have been intended to cover the kind of indirect and incremental harm that results to property interests from pollution. County of Columbia, 612 N.Y.S.2d 345, 634 N.E.2d at 950. Despite our respect for that court, we find ourselves more attracted to the view of the dissenting judge at the Appellate Division of the New York Supreme Court who indicated that he could not subscribe to the narrow construction given to the terms wrongful entry and other invasion of the right of private occupancy, and, thus, concluded that a claim of continuing trespass falls within the offenses contained in the personal injury portions of the policies there in question. County of Columbia v. Continental Ins. Co., 189 A.D.2d 391, 396, 595 N.Y.S.2d 988 (1993) (Crews, J., dissenting).
As noted above, in some of the insurance policies furnished to Kitsap County there is an exclusion from the bodily injury and property damage coverage for pollution-related damages. The insurers assert that if the personal injury coverage provisions are construed to cover the trespass and nuisance claims that were made against the County, then the pollution exclusion applicable to the property damage and bodily injury coverage will be read out f the policy. They suggest that if this is countenanced an insured could avoid limitations to coverage through the simple artifice of recharacterizing pollution liability claims as actions for `personal injury,' thereby trumping other limitations to coverage. Br. of Certain Insurers at 23. They cite several cases from other jurisdictions, most notably Titan Corp. v. Aetna Cas. & Sur. Co., 22 Cal.App. 4th 457, 27 Cal.Rptr.2d 476 (1994), which stands for this proposition. The County, on the other hand, asserts that a flaw in the insurers argument is that it proceeds on the incorrect assumption that every claim that arises from the release of pollutants will be or can be characterized as a trespass, nuisance, or interference with use and enjoyment of personal property. As the County observes, the pollution exclusion applicable to the property damage and bodily injury provisions would not be read out of the policy because it would have viability in cases where the claims against the insured could not be characterized as trespass, nuisance, or other claims for personal injury. Despite the efforts of the insurers to have us determine this question, we decline to do so. As we indicated above, we are only to answer the precise question addressed to us by the federal court. That court has not asked us to answer this question and we are loathe to do so, in any case, without a more complete record than we have been furnished. We observe only that all of the insurers whose policies are under scrutiny here chose to provide coverage for sums the insured became legally obligated to pay as damages because of personal injury. It was also the decision of at least some of those insurers to provide a pollution exclusion that by its express terms applies only to claims for bodily injury and property damage, and not to claims for personal injury. The fact that some insurers provided a pollution exclusion applicable to personal injury coverage furnishes a strong argument for the point that this issue could easily have been removed from the case by all of the insurers had they chosen to do so. Furthermore, the insurers' argument that the exclusions for pollution-related claims will be read out of the policy if the trespass, nuisance, and interference with use and enjoyment of property claims fall within the personal injury coverage of the policies, could be viewed as an undertaking by the insurers to read the personal injury provision out of the policies. Such a reading of the policy, arguably, is unfair and unreasonable. On the other hand, as we have already noted, some courts have taken the position that in the presence of a pollution exclusion clause, personal injury coverage is not available for damages caused by pollutants even if the complainant's allegations fall within personal injury coverage. The relative merits of those two positions will have to be decided in federal court.
The insurers contend that because the plaintiffs in the suits maintained against the County did not allege that the County committed any of the precise offenses that are enumerated in the personal injury coverage provisions, there is no coverage. More to the point, they note that the various plaintiffs claimed trespass, nuisance, and interference but did not claim that the County committed the offenses of wrongful entry or eviction or other invasion of the right of privacy. Thus, they argue that [b]ased on this simple comparison between the underlying complaints and the terms of the personal injury provisions, no coverage exists under this part of the policies. Br. of Certain Insurers at 29. The insurers cite E-Z Loader Boat Trailers, Inc. v. Travelers Indem. Co., 106 Wash.2d 901, 726 P.2d 439 (1986) and Seaboard Sur. Co. v. Ralph Williams' Northwest Chrysler Plymouth, Inc., 81 Wash.2d 740, 504 P.2d 1139 (1973), as support for this argument. In our view, these cases do not lend support to the argument. This court simply concluded in those two cases that it would not impose on an insurer the responsibility of providing coverage for a liability that was not set forth in the policy. We do not withdraw from that position to any degree. Those cases simply do not answer the primary question before uswhether the claims against the County for trespass, nuisance, and interference are equivalent to claims for wrongful entry or eviction or other invasion of the right of private occupancy. If they are, then they are claims for personal injury. Therefore, we devote our attention to that question in the remainder of this opinion.