Lafarge Corp. v. Travelers Indemnity Co.

32 F. App'x 851

• Court: Court of Appeals for the Ninth Circuit
• Decided: March 5, 2002
• Docket: No. 00-16996; D.C. No. CV-96-05938-REC
• Status: Published

Opinions

MEMORANDUM

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Lafarge Corporation appeals a grant of summary judgment in favor of its excess insurer, Appalachian Insurance Company. We have jurisdiction over this appeal pursuant to 28 U.S.C. § 1291. We review a grant of summary judgment de novo. See Botosan v. Paul McNally Realty, 216 F.3d 827 (9th Cir.2000). We agree with the district court’s statement of the law, but hold that the existence of a disputed factual issue precluded summary judgment in favor of Appalachian.

Because the parties are aware of the facts in this case, we will not recite them in detail in this decision.

Lafarge first argues that the district court erred in holding that California law requires horizontal exhaustion before an excess insurer is required to defend or indemnify its insured. We disagree. See Community Redevelopment Agency v. Aetna Cas. & Sur. Co., 50 Cal.App.4th 329, 57 Cal.Rptr.2d 755 (1996).

Lafarge also contends that the language of the Appalachian policy requires only exhaustion of the specifically listed underlying policies, not of all underlying insurance. The Appalachian policy does not limit exhaustion to only listed underlying policies. To the contrary, it requires exhaustion of all underlying insurance. “Absent a provision in the excess policy specifically describing and limiting the underlying insurance, ... all of the primary policies must exhaust before any excess will have coverage exposure.” Id. at 340, 57 Cal.Rptr.2d 755 (emphasis in original). Lafarge’s motion for partial summary judgment was correctly denied.

Lafarge argues that the district court misapplied the parties’ burdens on the motion for summary judgment. The district court correctly assigned the burdens of proof and production on the motion. However, we agree with Lafarge that there exists sufficient evidence to raise a genuine question as to whether the pollution exclusion in one or more of the Travelers policies applied, rendering the policies uncollectible. Specifically, the record reveals a genuine question of fact about whether the pollution was sudden and accidental. Lafarge concedes that the coverage available for pollution-related claims under its Appalachian policy is co-extensive with the coverage under its 1970 Travelers policy. However, the costs Lafarge incurred in administrative proceedings before the Water Board are not covered by the 1970 Travelers policy. See Foster-Gardner, Inc. v. National Union Fire Ins. Co., 18 Cal.4th 857, 77 Cal.Rptr.2d 107, 959 (1998); Certain Underwriters at Lloyd’s, London v. Superior Court, 24 Cal.4th 945, 103 Cal.Rptr.2d 672, 16 P.3d 94 (2001).

Accordingly, the district court’s order granting summary judgment is REVERSED. The case is REMANDED for further proceedings consistent with this decision.

This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as may be provided by Ninth Circuit Rule 36-3.