Court Opinion

ID: 6783151
Source: CourtListenerOpinion
Date Created: 2022-07-21 00:58:26.757806+00
Date Added: 2024-06-11T16:02:54.398042
License: Public Domain

Cook, J.,
dissenting. Today’s majority relies upon questionable analytical foundations in a strained attempt to find coverage where none exists.' I therefore respectfully dissent for the reasons that follow.

Interpretation of the Pollution Exclusion

Each of the policy exclusions at bar states, with minor variations in wording irrelevant to this court’s inquiry, that coverage does not extend to “ ‘bodily injury’ or ‘property damage’ arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of pollutants.” A “pollutant” is defined as “any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste.”
Construing this language, the trial court held that the exclusion applied “only to environmental discharge of traditionally environmental pollutants and not to cases involving exposure to carbon monoxide produced by a defective heating unit inside of a residential apartment unit.” The court of appeals rejected this conclusion, holding that “the pollution exclusion in the insurance contract issued to the insureds clearly and unambiguously precluded coverage for the claims asserted by the injured parties.”
I agree with the reasoning and conclusion of the court of appeals. It is well settled that “insurance contracts must be construed in accordance with the same rules as other written contracts.” Hybud Equip. Corp. v. Sphere Drake Ins. Co., Ltd. (1992), 64 Ohio St.3d 657, 665, 597 N.E.2d 1096, 1102. Therefore, “if the language of the policy’s provisions is clear and unambiguous, this court may not ‘resort to construction of that language.’ ” Id., quoting Karabin v. State Auto. Mut. Ins. Co. (1984), 10 Ohio St.3d 163, 167, 10 OBR 497, 499, 462 N.E.2d 403, 406. Rather, courts must give the words and phrases used in an insurance policy “ ‘their natural and commonly accepted meaning, where they in fact possess such meaning, to the end that a reasonable interpretation of the insurance contract consistent with the apparent object and plain intent of the parties may be determined.’ ” Id., quoting Tomlinson v. Skolnik (1989), 44 Ohio St.3d 11, 12, 540 N.E.2d 716, 717-718.
Whether the carbon monoxide incident that occurred in this case fits within the pollution exclusion therefore depends upon the meaning of the exclusion language. The majority finds that the exclusions contain “nonspecific and generic words or phrases that could be construed in a variety of ways.” This conclusion, *554however, both devalues any suggestion that, absent contrary intent, some words carry fixed meanings and favors conjuring ambiguity over objectivity.
The exclusions’ heading is “pollution.” Two natural and commonly accepted meanings of pollution are “1: the action of polluting [especially] by environmental contamination with man-made waste; also: the condition of being polluted 2: POLLUTANT.” (First emphasis added.) Merriam-Webster’s Collegiate Dictionary (10 Ed.1999) 902. The dictionary definition of a “pollutant” is simply “something that pollutes.” Id. As noted, the exclusions provide a more detailed definition of “pollutants.”
Carbon monoxide fits into both definitions of a pollutant, as its commonly accepted meaning is “a colorless odorless very toxic gas CO that burns to carbon dioxide with a blue flame and is formed as a product of the incomplete combustion of carbon.” (Emphasis added.) Merriam-Webster’s Collegiate Dictionary, supra, at 171. This definition falls within the exclusion’s definition of pollution as “any * * * gaseous * * * irritant or contaminant, including * * * vapor, * * * fumes, * * * [and] chemicals.” One commonly accepted meaning of “vapor” is “a substance in the gaseous state as distinguished from the liquid or solid state.” (Emphasis added.) Id. at 1306. Similarly, a “fume” is “a smoke, vapor, or gas [especially] when irritating or offensive” or “an often noxious suspension of particles, in a gas (as air).” (Emphasis added.) Id. at 472. These are not technical definitions describing environmental terms of art. The words are neither “nonspecific” nor “generic.” Rather, these are common words bearing commonly accepted meanings available to any layperson. Therefore, I conclude both that carbon monoxide falls within the foregoing definition of a “pollutant” and that the policies clearly exclude coverage.
Courts construing Ohio law have reached similar conclusions regarding pollution exclusions. See Zell v. Aetna Cas. & Sur. Ins. Co. (1996), 114 Ohio App.3d 677, 683 N.E.2d 1154 (pollution exclusion precluded coverage for fumes from weatherproofing materials); Air Prods. & Chems. v. Indiana Ins. Co. (Dec. 23, 1999), Hamilton App. Nos. C-980947 and C-990009, unreported, 2000 WL 955600, at *6 (pollution exclusion precluded coverage for methane gas leak); Owners Ins. Co. v. Singh (Sept. 21, 1999), Richland App. No. 98-CA-108, unreported, 1999 WL 976249, at *3 (pollution exclusion was clear and unambiguous so as to preclude coverage for carbon monoxide from a malfunctioning furnace). See, also, Longaberger Co. v. United States Fid. & Guar. Co. (S.D.Ohio 1998), 31 F.Supp.2d 595, affirmed (C.A.6, 1999), 201 F.3d 441 (unpublished disposition), opinion at 1999 WL 1252874 (both holding that under Ohio law a similar pollution exclusion was not ambiguous and precluded coverage for carbon monoxide released into a home by a furnace).
*555Courts in other jurisdictions have reached the same conclusion regarding the scope of such pollution exclusions. See, e.g., Deni Assoc. of Florida, Inc. v. State Farm Fire & Cas. Ins. Co. (Fla.1998), 711 So.2d 1135, 1138, quoting Am. States Ins. Co. v. F.H.S., Inc. (S.D.Miss.1991), 843 F.Supp. 187, 190 (“The court reiterates that it is not free to rewrite the terms of the insurance contract where that contract is not ambiguous”); W. Am. Ins. Co. v. Band & Desenberg (M.D.Fla.1996), 925 F.Supp. 758, 761 (“The majority of courts that have reviewed these absolute [pollution] exclusions have found them to be unambiguous and have enforced then in accordance with their plain language”). See, also, 9 Russ & Segalla, Couch on Insurance (3 Ed.1997) 127-36 to 127-37, Section 127:14, fn. 30 (collecting cases that have found “absolute” pollution exclusions unambiguous), and 127-39, Section 127:15 (noting that the majority view regards such exclusions as unambiguous). Accordingly, I would hold that the pollution exclusions at issue herein clearly and unambiguously preclude coverage.

Historical Context of the Exclusion

The majority relies upon “the genesis of the pollution exclusion” to conclude that “[b]ased on the history and original purposes for the pollution exclusion, it was reasonable for Highland House and RMI to believe that the policies purchased for their multiunit complex would not exclude claims for injuries due to carbon monoxide leaks.” Without citing a basis for doing so, the majority apparently credits Highland House and RMI as having had knowledge of the historical development of absolute pollution exclusions at the time they purchased the relevant policies and accepts this as informing the relevant policy language. But Indiana Insurance argues that Highland House and RMI failed to produce summary judgment evidence in the record supporting this “historical context” argument.
By focusing on supposed after-the-fact knowledge of the insureds, the majority narrows the meaning of the pollution exclusions beyond that conveyed by the common understanding of the words. The policy language itself, however, offers no reason to eschew the dictionary uses of these common words in favor of discerning the meaning from the historical development of pollution exclusions. The text of the policy exclusions guides judicial interpretation. Nothing in the text of the policies limits application of the exclusions to environmental-type pollution.
Instead, as noted, the exclusions contain ordinary words that on their face bear the broad application understood by the court of appeals here. To collapse the exclusions’ broad meaning in the way the majority does contradicts axiomatic contract principles. See Hybud Equip. Corp., 64 Ohio St.3d at 665, 597 N.E.2d at 1102 (court cannot engage in construction of policy language when language is clear and unambiguous). See, also, Madison Constr. Co. v. Harleysville Mut. *556Ins. Co. (1996), 451 Pa.Super. 136, 144, 678 A.2d 802, 806 (declining to divine the public policy behind an exclusion where “the policy language is clear and unambiguous” and where such an exercise would “ ‘convolute the plain meaning of a writing merely to find an ambiguity,’ ” quoting O’Brien Energy Sys., Inc. v. Am. Employers’ Ins. Co. [1993], 427 Pa.Super. 456, 462, 629 A.2d 957, 960).

Reasonable-Expectations Doctrine

Despite the foregoing substantive deficiencies, the majority nonetheless finds the effect of Highland House’s and RMI’s alleged history-based belief “comparable to the effect of the reasonable-expectations doctrine.” While then professing to “make no determination on the merits of the reasonable-expectations doctrine,” the majority proceeds in the following pages to find that the doctrine’s rationale could apply to the case at bar. Such dicta serve only to confuse the state of insurance law in Ohio.
In its earliest formation, the reasonable-expectations doctrine arose from two principles: that “an insurer will be denied any unconscionable advantage in an insurance transaction,” and that “the reasonable expectations of applicants and intended beneficiaries [of an insurance policy] will be honored.” Keeton, Insurance Law Rights at Variance With Policy Provisions (Part One) (1970), 83 Harv.L.Rev. 961. See, also, Keeton, Insurance Law Rights at Variance With Policy Provisions (Part Two) (1970), 83 Harv.L.Rev. 1281. Courts have disagreed over the scope and operation of this doctrine. See, generally, Swisher, A Realistic Consensus Approach to the Insurance Law Doctrine of Reasonable Expectations (2000), 35 Tort & Ins.L.J. 729; Henderson, The Doctrine of Reasonable Expectations in Insurance Law After Two Decades (1990), 51 Ohio St.L.J. 823; Ware, A Critique of the Reasonable Expectations Doctrine (1989), 56 U.Chi.L.Rev. 1461.
Some courts, for example, adhere to the belief that the doctrine operates in instances of ambiguity, permitting a court to grant coverage “if ‘the policyholder, upon reading the contract language is led to a reasonable expectation of coverage.’ ” Meridian Mut. Ins. Co. v. Kellman (C.A.6, 1999), 197 F.3d 1178, 1183, quoting Fire Ins. Exchange v. Diehl (1996), 450 Mich. 678, 687, 545 N.W.2d 602, 606; Max True Plastering Co. v. United States Fid. & Guar. Co. (Okla.1996), 912 P.2d 861, 868-869. See, also, Ware, 56 U.Chil.Rev. at 1467-1468, fn. 32 (collecting cases using this approach). Other courts have adopted a more expansive understanding of the doctrine in which “even an unambiguous policy may be ‘interpreted according to the reasonable expectations of the insured.’ ” (Emphasis added.) Nelson v. Becton (C.A.8, 1991), 929 F.2d 1287, quoting Atwater Creamery Co. v. W. Natl. Mut. Ins. Co. (Minn.1985), 366 N.W.2d 271, 277. See, also, Ware, 56 U.Chi.L.Rev. at 1469-1472, fn. 40 (collecting cases adopting a “fine-print” approach in which terms buried in a policy will not be *557enforced when they conflict with an insured’s reasonable expectations) and 1472-1475, fn. 54 (collecting cases adopting a “whole-transaction” approach in which courts will also consider insurers’ marketing patterns and general practices in deciding whether policy terms should be enforced). This court has mentioned the doctrine recently in Davidson v. Motorists Mut. Ins. Co. (2001), 91 Ohio St.3d 262, 269-270, 744 N.E.2d 713, 719.
Benesch, Friedlander, Coplan & Aronoff, LLP, David W. Mellot and Mark D. Tucker, for appellants.
Green & Green and Thomas M. Green, for appellee.
Robert P. Rutter, urging reversal for amicus curiae Ohio Academy of Trial Lawyers.
Davis & Young and David J. Fagnilli, urging affirmance for amicus curiae Insurance Environmental Litigation Association.
Baker, Dublikar, Beck, Wiley & Mathews and James P. Hanratty, urging affirmance for amicus curiae Ohio Association of Civil Trial Attorneys.
Setting aside the curious technique of devoting several pages of an opinion to a doctrine that the opinion expressly declines to rely upon, it is unclear what form of the rejected doctrine the majority finds potentially applicable to this case. The majority cites both Highland House’s and RMI’s alleged belief of coverage (without record evidence) and “the importance of interpreting ambiguities in insurance contracts in favor of the insured.” If the majority were confident in its decision that the exclusions are indeed ambiguous, it is equally unclear why the majority would resort to discussing parties’ beliefs when Ohio already recognizes that courts shall construe ambiguous insurance contract language in favor of the insured and strictly against the insurer. See, e.g., Faruque v. Provident Life & Acc. Ins. Co. (1987), 31 Ohio St.3d 34, 31 OBR 83, 508 N.E.2d 949, syllabus.
In any event, I would not reach the questions of the applicability and the scope of the reasonable-expectations doctrine here because the facts of this case would not support it. That is, even if Highland House and RMI subjectively believed that coverage would extend to a carbon monoxide leak, such an expectation must nonetheless have been objectively reasonable under the doctrine. And given that the language employed in the pollution exclusion on its face is not limited to environmental-type pollution, I would conclude that this subjective expectation of coverage is not objectively reasonable under the terms of the policies.
For the foregoing reasons, I would hold that the pollution exclusions in the insurance policies preclude coverage. Because Indiana Insurance was entitled to judgment as a matter of law, I would affirm the judgment of the court of appeals.
Mover, C.J., concurs in the'foregoing dissenting opinion.