Court Opinion

ID: 9741373
Source: CourtListenerOpinion
Date Created: 2023-08-26 20:54:20.113792+00
Date Added: 2024-06-11T07:24:23.715239
License: Public Domain

JUSTICE COOK, dissenting: I respectfully dissent. There is no dispute as to the facts. Myers owned a warehouse in which it stored agricultural chemicals and fertilizer. Next to the Myers property was a car dealership. While Janes & Addems owned the dealership, petroleum products were allowed to accumulate on the property; those products spread to the Myers property, both above and below the surface. After new owners purchased the dealership on January 2, 1990, the accumulation and spreading continued. On March 28, 1990, dealership employees burned some garbage on the dealership property. Because of the accumulated petroleum above and below the ground, the fire spread to the Myers warehouse and destroyed it. Plaintiffs in this declaratory judgment action are insurance companies which had issued liability policies to the dealership. Those policies had all expired prior to the fire on March 28, 1990. The accumulation and spreading of petroleum products occurred, however, within the period of each policy. The majority opinion recognizes the Myers property sustained damage at the time it was contaminated with petroleum products. The majority opinion denies coverage, however, because "Myers is seeking recovery, not for the presence of the petroleum products or for the removal of the chemicals, but for damage resulting from the fire.” 263 Ill. App. 3d at 405. Insurers made the same argument in Zurich, another case involving liability policies, but involving liability for bodily injury instead of property damage. In Zurich, workers had inhaled asbestos during the policy period, and microscopic changes ("injuries”) had quickly occurred in their lungs, but asbestosis, mesothelioma, or bronchogenic carcinoma did not occur during the policy period. (Zurich, 118 Ill. 2d at 44-45, 514 N.E.2d at 159-60 ("[A]n asbestos-related disease occurs when it progresses to the point at which it significantly impairs the lungs’ function”).) The insurers argued plaintiffs did not seek damages for microscopic or cellular "injury” but for the asbestos-related diseases, and accordingly there should be no coverage as those diseases had not occurred during the policy period. The supreme court rejected the argument, holding (1) the policies required the insurers to provide coverage of asbestos-related claims if the claimant suffered bodily injury during the policy period, and (2) "bodily injury” took place at or shortly after the time of exposure to asbestos. Zurich, 118 Ill. 2d at 47, 514 N.E.2d at 161. Defendants also cite United States Fidelity (144 Ill. 2d 64, 578 N.E.2d 926), but the facts there are different from Zurich. In United States Fidelity the asbestos fiber contamination which began when the fireproofing was sprayed on was the same contamination for which recovery was eventually sought. See also Board of Education v. A,C&S, Inc. (1989), 131 Ill. 2d 428, 446-49, 546 N.E.2d 580, 588-90 (buildings "damaged” when contamination reaches point where corrective action must be taken). The elements of a negligence cause of action are (1) a duty of care, (2) a breach of that duty, and (3) an injury proximately caused by the breach. (Curatola v. Village of Niles (1993), 154 Ill. 2d 201, 207, 608 N.E.2d 882, 885.) A breach of duty is not enough for a cause of action — there must be injury as well. Most liability policies similarly limit coverage to occurrences within the policy period by their definition of "bodily injury” or "property damage.” For example, the American States policy provides: " '[Property damage’ means (1) physical injury to or destruction of tangible property which occurs during the policy period ***.” As the majority points out, in Tinley Park there were "negligent acts” during the policy period, but those acts did not result in bodily injury during the policy period. The Tinley Park court properly found no coverage. Defendants here do not argue, however, that coverage may be based on mere acts which would eventually lead to property damage. There were "negligent acts” here, but there was also property damage. The key question in this case is whether the existence of some property damage during the policy period is sufficient to trigger coverage for other, related, property damage which occurs after the policy period. Zurich answers that question in the affirmative. Zurich may be criticized because it exposes insurers to unpredictable claims long after their policies were thought to have expired. Such exposure is warranted, however, by the policy language. The American States policy provides that the company will pay "all sums which the insured shall become legally obligated to pay as damages” because of property damage "to which this insurance applies, caused by an occurrence.” If a claimant is injured when he is struck by a falling wall, his condition may worsen for many months before his eventual death, and unforeseen complications may develop. Yet the insurer which provides coverage at the time of the injury is liable for all resulting damages, even those outside the policy period. It is only necessary that injury occur during the policy period, not that all the damages for which recovery is sought accrue. In Zurich the damages eventually sought were related to the injury which occurred when the asbestos was inhaled. Such a relationship is also present in this case, where it is alleged that the damage during the policy period was later a cause of the fire at the Myers warehouse. If the damage were not a cause, for example if the contamination were by nonflammable products, there should be no coverage. It could be argued that the damages for which recovery is eventually sought must be the inevitable result of the property damage during the policy period. Zurich does not impose such a limitation, however. There is no indication in Zurich that there would be coverage for exposure to asbestos only if that exposure would inevitably lead to asbestosis. The majority argues that a finding of coverage in this case would impose a never-ending duty upon insurers. That is not correct. An insurer’s duty ends when the policy period ends unless there has been property damage, physical injury to tangible property, during that time. This is an unusual case and it may be that the justification for coverage is not as strong here as it is in other cases. It is a mistake, however, to abandon the Zurich analysis without a principled basis for doing so.