Allstate Ins Co.
v. Bonn et. al.
(United States
District Court, District of Rhode Island, May 3, 2010)
This environmental coverage
matter arose from a complaint against landlords of a residence alleging that
the tenant’s two daughters were exposed to lead paint and suffered lead poisoning
during their tenancy at property owned by the policyholder landlords. The insurer sought a declaration that its
liability for claims asserted by the tenants in the underlying complaint is
limited to the total amount of $100,000.
The tenants sought to establish that coverage under the policy extended
to $100,000 for each child for a total sum of $200,000.
Specifically, tenants argued that
(1) their children's lead poisoning was the result of multiple occurrences; (2)
the Policy language was ambiguous and should be construed in favor of the
insured; (3) the "cause theory" mandates a finding of multiple
occurrences; (4) precedent exists for awarding each child injured by a single
occurrence the full policy limit; and (5) restricting the children's remedy to
a single policy limit is against public policy.
The court, however, held that the
policy language was clear. It provided
that the total liability under Coverage X was limited to $100,000, "[r]egardless of the number of . . .
injured persons [or] claims." The court further held that the "plain
and ordinary meaning" of that provision is that, regardless of whether
damages resulting from one loss involve a single injured person or many, the
insurer is obligated to pay no more than $100,000 total under the policy .
Further, the court concluded that the policy defined "one loss" as
"[a]ll bodily injury, personal injury and property damage resulting from
one accident or from continuous or repeated exposure to the same general
conditions." (emphasis added in original). The policy terms "all
bodily injury [and] personal injury" clearly encompassed the lead
poisoning suffered by both daughters as a result of continuous or repeated
exposure to the same existing and continuing conditions at the subject property,
i.e. the presence of lead in the residence. Consequently the court held that the injury,
although tragically suffered by both minor children, constituted only "one
loss" under the unambiguous language of the policy. Lastly, the court also discredited plaintiffs
“cause theory” as the court concluded that the children’s injuries were the
result of a single occurrence as defined under the policy.
For a copy of the decision click here
Tom Segalla and Paul Steck
https://www.goldbergsegalla.com/attorneys/Steck.html
https://www.goldbergsegalla.com/attorneys/Segalla.html
case provided courtesy of Lexis