Auto Owners Insurance v. City of Tampa Housing

• Court: Court of Appeals for the Eleventh Circuit
• Decided: November 1, 2000
• Docket: 00-10283
• Status: Published

Opinion

[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT FILED U.S. COURT OF APPEALS ________________________ ELEVENTH CIRCUIT NOV. 1, 2000 No. 00-10283 THOMAS K. KAHN CLERK ________________________

D. C. Docket No. 98-00565-CIV-T-26E

AUTO OWNERS INSURANCE CO.,

Plaintiff-Appellee,

versus

CITY OF TAMPA HOUSING AUTHORITY, a municipal agency,

Defendant-Appellant.

________________________

Appeal from the United States District Court for the Middle District of Florida _________________________ (November 1, 2000)

Before BLACK, BARKETT and FAY, Circuit Judges.

BARKETT, Circuit Judge:

The Housing Authority of the City of Tampa (the “Housing Authority”)

appeals from summary judgment awarded to Auto-Owners Insurance Company (the “Insurance Company”) on the Insurance Company’s suit for declaratory

judgment. The summary judgment declares that because of a pollution exclusion

clause in the policy covering the Housing Authority, the Insurance Company is

liable for neither indemnification nor the costs of defense incurred by the Housing

Authority when it was sued (the “Underlying Suit”) for negligence. The

Underlying Suit was brought against the Housing Authority by Sheletha Filmore,

as mother and next friend of Darron Campbell, a child residing in a housing

complex operated by the Housing Authority, alleging that Campbell had suffered

injury by “ingesting and inhaling” lead from paint on the walls of the housing

complex.

The district court held that because the injury alleged in the Underlying Suit

arose out of the “discharge, dispersal, seepage, migration, release or escape of

pollutants” it was specifically excluded from coverage under the policy. The

Housing Authority argues two issues on appeal: first, that lead is not a pollutant as

defined in the pollution exclusion clause; and second, that the lead in question did

not move in the manner described in the pollution exclusion clause, to wit, through

discharge, dispersal, seepage, migration, release or escape.

FACTS

2 The Insurance Company provided the Housing Authority with general

commercial liability insurance from October, 1992 to October, 1995. Plaintiffs in

the Underlying Suit alleged that, during the coverage period, Campbell was injured

as a result of ingesting and inhaling lead from the old and crumbling paint on the

walls of a Housing Authority dwelling. The Insurance Company agreed to defend

the Housing Authority in the Underlying Suit under a reservation of rights. In this

suit, the Insurance Company seeks a determination that it is not liable to the

Housing Authority for the costs of defense or indemnification because the policy

taken out by the Housing Authority contains a pollution exclusion clause which,

the Insurance Company claims, covers liability arising from exposure to lead. The

pollution exclusion “movement clause” states that it covers:

“Bodily injury” or “property damage” arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of pollutants.

“Pollutants” are defined to include:

any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste. Waste includes materials to be recycled, reconditioned or reclaimed.

We review de novo a district court’s grant of summary judgment, applying

the same legal standards as the district court. See Whatley v. CNA Ins. Cos., 189

F.3d 1310, 1313 (11th Cir. 1999). Summary judgment is appropriate if the

3 evidence before the court shows that “there is no genuine issue as to any material

fact and that the moving party is entitled to a judgment as a matter of law.” Fed. R.

Civ. P. 56(c).

DISCUSSION

In Deni Assoc. of Florida, Inc. v. State Farm & Cas. Ins. Co., 711 So.2d

1135 (Fla. 1998), the Florida Supreme Court, in enforcing pollution exclusions

almost identical to the one in this case, reiterated the principle that if the policy

language is clear and unambiguous, it must be enforced. Deni cautioned that a

court should not “place limitations upon the plain language of a policy exclusion

simply because we may think that it should have been written that way.” Id. at

1139. In this case, both parties agree that the policy’s pollution exclusion clause is

unambiguous and that this case is governed by Florida law.

As to the first issue, under Florida law, the district court correctly found that

lead is a “pollutant” under the terms of the policy. The district court found that

lead is a “pollutant” under the policy because it is a chemical, and the pollution

exclusion clause specifically lists “chemicals” in its definition of “pollutants.”

Moreover, lead is specifically recognized as a pollutant under Florida laws

governing pollutant discharge prevention and removal. Fla. Stat. Ch. 376.301(32)

4 (2000).1 Consequently, we are satisfied that the district court is correct in finding

under Florida law that lead is a pollutant according to the plain meaning of the

pollution exclusion clause. See Deni, 711 So.2d at 1141 (finding that the pollution

exclusion clause clearly covers ammonia, after referring to a dictionary definition

of the substance and to the Federal Clean Air Act).

This Court addressed the identical pollution exclusion clause in West

American Ins. Co. v. Band & Desenberg, 138 F.3d 1428 (11th Cir. 1998). The

district court had decided West American before the Florida Supreme Court

decided Deni. It found that the unambiguous pollution exclusion clause barred

coverage for injuries caused by contaminants in the air in a building covered by the

policy. West American Ins. Co. v. Band & Desenberg, 925 F.Supp. 758, 761

(M.D. Fla. 1996). After the Florida Supreme Court decided Deni, a panel of this

Court affirmed the district court’s decision in West American. 138 F.3d at 1428.

We conclude that the injury alleged in this case – resulting from the ingesting and

1 See also, the Federal Lead-Based Paint Poisoning Prevention Act, 42 U.S.C. §§ 4822(a)(1) & (c) (1995) (addressing the “hazards of lead based paint poisoning” in existing housing and requiring inspection and disclosure of any lead found in such housing); the Federal Residential Lead-Based Hazard Reduction Act of 1992, 42 U.S.C. § 4851(b)(15) (1995) (defining “lead based paint hazard” as “any condition that causes exposure to lead from lead- contaminated dust, lead-contaminated soil, lead-contaminated paint that is deteriorated or present in accessible surfaces, friction surfaces, or impact surfaces that would result in adverse human health effects . . . .”), 42 U.S.C. § 4851(4) (noting that Congress found that “the ingestion of household dust containing lead released by lead paint is the most common cause of lead poisoning in children”), and 42 U.S.C. § 4852(a) (authorizing federal grants to reduce lead based paint hazards).

5 inhaling of lead from the old and crumbling paint in a Housing Authority dwelling

– clearly arises from the “discharge, dispersal, release, escape, seepage or

migration” of a pollutant, and we therefore agree with the district court that the

exclusion clause bars coverage under the policy.

CONCLUSION

For the foregoing reasons, we AFFIRM the decision of the district court,

granting summary judgment to the Insurance Company and declaring that it is

liable for neither indemnification nor the costs of defense incurred by the Housing

Authority in the Underlying Suit.

AFFIRMED.