Court Opinion

ID: 9707733
Source: CourtListenerOpinion
Date Created: 2023-08-26 02:20:09.74365+00
Date Added: 2024-06-11T18:22:37.418601
License: Public Domain

NORTON, Judge
(concurring in part, dissenting in part).
I respectfully dissent in regard to the pollution exclusion issue. On all other issues, I concur with the majority opinion. The third clause of the pollution exclusion on which the majority relies refers to Grace’s operation other than oil and/or gas operations. The London policies do not define operations; however, the policies distinguish between the insured’s operations and the insured’s goods or products. The policies’ definition of “products liability” includes:
Liability arising out of goods or products manufactured, sold, handled or distributed by the Assured * * * if the occurrence occurs after possession of such goods or products has been relinquished to others by the Assured * * * and if such occurrence occurs away from premises owned, rented or controlled by the Assured * * *.
Liability arising out of operations, if the occurrence occurs after such operations have been completed or abandoned and occurs away from premises owned, rented or controlled by the Assured.
In determining the coverage afforded by an insurance policy, we must consider the policy as a whole, and give unambiguous language its plain and ordinary meaning. Henning Nelson Constr. Co. v. Fireman’s Fund Am. Life Ins. Co., 383 N.W.2d 645, 652 (Minn.1986). The commonly understood meaning of the term “operations” does not include products manufactured by the insured. See Friestad v. Travelers Idem. Co., 260 Pa.Super. 178, 393 A.2d 1212, 1213 n. 2 (1978) (premises-operations coverage refers to injuries or losses at insured’s business premises and non-owned premises under the insured’s control; completed operations coverage supplements losses on non-owned premises after insured relinquishes control; products hazard coverage requires insured’s manufacture or sale of product, relinquishment of control over product, and injury caused by product away from insured’s business premises).
In addressing this issue, it is appropriate to consider the insurance industry’s generally accepted definition of the term “operations,” See Carey Canada, Inc. v. California Union Ins. Co., 748 F.Supp. 8, 15-16 (D.D.C.1990) (where exclusion contained oil industry terms of art that pertained to oil and gas operations, court would not apply exclusion to asbestos claim). The standard business owner’s property coverage form issued by the Insurance Services Office defines “operations” as “your business activities occurring at the described premises.” See Susan J. Miller & Philip Lefebvre, 1 Miller’s Standard Insurance Policies Annotated 507.13 (1991). This definition does not include Grace’s products.
A pollution exclusion can bar coverage for the insured’s products as well as the insured’s operations. Board of Regents of Univ. of Minn. v. Royal Ins. Co., 517 N.W.2d 888, 891 (Minn.1994). The exclusion at issue in this case, however, does not include the insured’s products, even though the policies’ products liability coverage distinguishes between operations and products. A pollution exclusion that is specifically applicable to Grace’s operations should not be extended to exclude coverage for liability arising out of Grace’s completed products. See Green Constr. Co. v. National Union Fire Ins. Co., 771 F.Supp. 1000, 1007 (W.D.Mo.1991) (refusing to extend faulty workmanship exclusion to insured’s completed operations).
I believe that none of the pollution exclusions in the London policies bars coverage for the claims of the school districts against Grace.