Opinion ID: 1734320
Heading Depth: 1
Heading Rank: 9

Heading: Proper Interpretation of the Total Pollution Exclusion

Text: Ducote held that a pollution exclusion applies regardless of whether the release was intentional or accidental, a one-time event or part of an on-going pattern of pollution. Ducote, 98-0942 at 4, 730 So.2d at 437. Further, the case specifically rejected the premise that a distinction should exist between active polluters and other policy holders. See id. In light of the origin of pollution exclusions, as well as the ambiguous nature and absurd consequences which attend a strict reading of these provisions, we now find that the total pollution exclusion was neither designed nor intended to be read strictly to exclude coverage for all interactions with irritants or contaminants of any kind. Instead, we find that [i]t is appropriate to construe [a] pollution exclusion clause in light of its general purpose, which is to exclude coverage for environmental pollution, and under such interpretation, [the] clause will not be applied to all contact with substances that may be classified as pollutants. Russ, supra, at § 127:6 n. 62. The applicability of a total pollution exclusion in any given case must necessarily turn on several considerations: (1) Whether the insured is a polluter within the meaning of the exclusion; (2) Whether the injury-causing substance is a pollutant within the meaning of the exclusion; and (3) Whether there was a discharge, dispersal, seepage, migration, release or escape of a pollutant by the insured within the meaning of the policy. First, the determination of whether an insured is a polluter is a fact-based conclusion that should encompass consideration of a wide variety of factors. In making this determination, the trier of fact should consider the nature of the insured's business, whether that type of business presents a risk of pollution, whether the insured has a separate policy covering the disputed claim, whether the insured should have known from a read of the exclusion that a separate policy covering pollution damages would be necessary for the insured's business, who the insurer typically insures, any other claims made under the policy, and any other factor the trier of fact deems relevant to this conclusion. [17] Second, the determination of whether the injury-causing substance is a pollutant is also a fact-based conclusion that should encompass a wide variety of factors. As pointed out above, there are a variety of substances that could fall within the broad definition of irritants and contaminants as provided in this policy. For example, under pollution exclusions similar to the one at issue here, courts have found pollutant to include everything from asbestos, carbon monoxide, gasoline, lead paint, and some pesticides; on the other hand, some courts have found that pollutants do not include muriatic acid, styrene resins, and other forms of pesticide. See Russ, supra, at § 127:12 (collecting authorities). Consequently, when making this determination, the trier of fact should consider the nature of the injury-causing substance, its typical usage, the quantity of the discharge, whether the substance was being used for its intended purpose when the injury took place, whether the substance is one that would be viewed as a pollutant as the term is generally understood, and any other factor the trier of fact deems relevant to that conclusion. Finally, the determination of whether there was discharge, dispersal, seepage, migration, release or escape is likewise a fact-based conclusion that must result after a consideration of all relevant circumstances. [18] Specifically, the trier of fact should consider whether the pollutant was intentionally or negligently discharged, the amount of the injury-causing substance discharged, whether the actions of the alleged polluter were active or passive, and any other factor the trier of fact deems relevant. These factual conclusions should be made to assist a court in determining whether the total pollution exclusion in any particular case will exclude coverage for a claim. [19] Turning to the court of appeal's ruling in this case on the motion for summary judgment filed by Genesis Insurance Co., we reverse the court of appeal, deny the motion, and remand the case to the district court.