Present: All the Justices
TRAVCO INSURANCE COMPANY OPINION BY v. Record No. 120347 JUSTICE S. BERNARD GOODWYN November 1, 2012 LARRY WARD
UPON A QUESTION OF LAW CERTIFIED BY THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT
Pursuant to Article VI, Section 1 of the Constitution of
Virginia and Rule 5:40, we accepted the following certified
question of law from the United States Court of Appeals for the
Fourth Circuit:
For purposes of interpreting an “all risk” homeowners insurance policy, is any damage resulting from this drywall unambiguously excluded from coverage under the policy because it is loss caused by:
(a) “mechanical breakdown, latent defect, inherent vice, or any quality in property that causes it to damage itself”;
(b) “faulty, inadequate, or defective materials”;
(c) “rust or other corrosion”; or
(d) “pollutants,” where pollutant is defined as “any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste?[”]
Background
Larry Ward sought coverage under his homeowners’ insurance
policy issued by TravCo Insurance Company (TravCo) for damages
allegedly caused by sheets of drywall manufactured in China
(Chinese drywall) that were installed in his home during its construction. TravCo denied Ward’s claim and brought an action
in the United States District Court for the Eastern District of
Virginia, seeking a declaratory judgment that Ward’s
homeowners’ policy did not provide coverage for such losses.
TravCo moved for summary judgment, and the district court
granted the motion on the basis that the policy did not provide
coverage for the damages allegedly caused by the drywall in
Ward’s residence because of certain policy exclusions. Ward
appealed the ruling of the district court to the United States
Court of Appeals for the Fourth Circuit, which certified to
this Court the question of whether the policy exclusions are
applicable to Ward’s claimed losses. The Fourth Circuit
stated:
[W]e are uncertain whether the Supreme Court of Virginia would conclude that each of these four exclusions is unambiguous and reasonable in its form, scope, and application in light of the unusual nature of the losses involved, and the answer to this question is sufficiently unsettled and dispositive that certification is warranted.
Facts
In May 2007, Ward purchased a newly constructed home
located in Virginia Beach and shortly thereafter obtained a
home insurance policy from TravCo. The policy was effective
from May 7, 2007 to May 7, 2008, and was renewed through May 7,
2010. In May 2009, Ward experienced problems with the home and
2 hired an expert, Zdenek Hejzlar, Ph.D., 1 who determined that the
problems were caused by Chinese drywall installed in the house
during construction. Ward thereafter filed a complaint against
the developer, builder and drywall contractor in the Circuit
Court of the City of Norfolk. Ward alleged that the Chinese
drywall in his home emitted various sulfide gases and/or toxic
chemicals through “off-gassing” that created noxious odors and
caused health issues, damage and corrosion. He alleged breach
of contract, breach of warranties, negligence, unjust
enrichment, nuisance, and other counts claiming that his home
“was built with defective drywall.”
Ward subsequently filed a homeowners’ claim with TravCo in
September 2009; he stated that the drywall caused fumes and
odors, health issues, and damage to the home’s air conditioning
system, garage door, and flatscreen televisions. Ward
submitted to TravCo a report detailing the condition of his
home, prepared by Dr. Hejzlar. Dr. Hejzlar reported a sulfuric
odor in the home and confirmed the presence of Chinese drywall.
He also noted damage to the HVAC coils and other metallic
surfaces in the home and noted that the damage was associated
with sulfur emissions from the Chinese drywall.
1 Hejzlar received his doctorate in Occupational Safety and Health Engineering and has investigated hundreds of homes and condominiums reporting problems associated with Chinese drywall.
3 TravCo thereafter denied Ward’s claim, alleging that the
damage caused by the Chinese drywall was excluded from coverage
by the terms of Ward’s homeowners’ policy. Relevant to the
certified question are exclusions in the policy for loss caused
by:
(1) latent defect;
(2) faulty, inadequate, or defective materials;
(3) rust or corrosion; and
(4) pollutants, defined to include any gaseous irritant
or contaminant.
Analysis
The following well-settled principles of Virginia
insurance contract interpretation govern this case and are
applicable to all subparts of the certified question. Both
parties urge, to varying degrees, examination of decisions from
other jurisdictions, but this Court need not undertake such
analysis “because the law of this Commonwealth and the plain
language of the insurance policy provide the answer to the
certified question.” City of Chesapeake v. States Self-
Insurers Risk Retention Group, Inc., 271 Va. 574, 579, 628
S.E.2d 539, 542 (2006). We conclude that each of the four
exclusions is unambiguous and reasonable in its form, scope and
application and excludes damage resulting from the Chinese
drywall from coverage.
4 This Court interprets the provisions of an insurance
contract under a de novo standard of review. E.g.,
Transcontinental Ins. Co. v. RBMW, Inc., 262 Va. 502, 510, 551
S.E.2d 313, 317 (2001). “It is axiomatic that when the terms
in a contract are clear and unambiguous, the contract is
construed according to its plain meaning.” Barber v. VistaRMS,
Inc., 272 Va. 319, 329, 634 S.E.2d 706, 712 (2006). “ ‘Words
that the parties used are normally given their usual, ordinary,
and popular meaning. No word or clause in the contract will be
treated as meaningless if a reasonable meaning can be given to
it, and there is a presumption that the parties have not used
words needlessly.’ ” City of Chesapeake, 271 Va. at 578, 628
S.E.2d at 541 (quoting D.C. McClain, Inc. v. Arlington Cnty.,
249 Va. 131, 135-36, 452 S.E.2d 659, 662 (1995)).
Courts interpret insurance policies, like other contracts,
in accordance with the intention of the parties gleaned from
the words they have used in the document. Each phrase and
clause of an insurance contract “ ‘should be considered and
construed together and seemingly conflicting provisions
harmonized when that can be reasonably done, so as to
effectuate the intention of the parties as expressed
therein.’ ” Floyd v. Northern Neck Ins. Co., 245 Va. 153, 158,
427 S.E.2d 193, 196 (1993) (quoting Suggs v. Life Ins. Co. of
Virginia, 207 Va. 7, 11, 147 S.E.2d 707, 710 (1966)).
5 Furthermore,
“[i]nsurance policies are contracts whose language is ordinarily selected by insurers rather than by policy-holders. The courts, accordingly, have been consistent in construing the language of such policies, where there is doubt as to their meaning, in favor of that interpretation which grants coverage, rather than that which withholds it. Where two constructions are equally possible, that most favorable to the insured will be adopted. Language in a policy purporting to exclude certain events from coverage will be construed most strongly against the insurer.”
PBM Nutritionals, LLC v. Lexington Ins. Co., 283 Va. 624, 633-
34, 724 S.E.2d 707, 713 (2012) (quoting Copp v. Nationwide Mut.
Ins. Co., 279 Va. 675, 681, 692 S.E.2d 220, 223 (2010)).
Consequently, insurers are required to draft exclusions
limiting coverage in language that clearly and unambiguously
defines their scope. Id. (citing Lower Chesapeake Assocs. v.
Valley Forge Ins. Co., 260 Va. 77, 88, 532 S.E.2d 325, 331
(2000)). We have therefore long held that the burden is upon
the insurer to prove that an exclusion of coverage applies.
See, e.g., Johnson v. Insurance Co. of N. Am., 232 Va. 340,
345, 350 S.E.2d 616, 619 (1986); White v. State Farm Mut. Ins.
Co., 208 Va. 394, 396, 157 S.E.2d 925, 927 (1967); Life Ins.
Co. v. Brockman, 173 Va. 86, 93, 3 S.E.2d 480, 483 (1939).
However, “[u]nder Virginia law, an insurance policy is not
ambiguous merely because courts of varying jurisdictions differ
with respect to the construction of policy language.
6 Additionally, ‘where the exclusion is not ambiguous, there is
no reason for applying the rules of contra proferentem or
liberal construction for the insured.’ ” PBM Nutritionals, 283
Va. at 634, 724 S.E.2d at 713 (quoting 2 Eric M. Holmes,
Appleman on Insurance 2d § 7.2 (1996 & Supp. 2009)) (internal
citation omitted).
Certified Question Subpart (a)
The homeowners’ policy latent defect exclusion provides
that TravCo does not insure for loss caused by “[l]atent
defect, inherent vice, or any quality in property that causes
it to damage or destroy itself.” Ward argues that the latent
defect exclusion is susceptible to multiple meanings under
principles of noscitur a sociis. 2 Thus, the entire exclusion is
qualified by the modifier “that causes it to damage or destroy
itself.” Ward also claims that the use of “latent defect” and
“inherent vice” in the exclusion causes ambiguity because
“latent defect” is ordinarily defined as undiscoverable by
proper inspection or known tests, while “inherent vice” refers
to a loss from internal decomposition. Additionally, he
2 “The maxim of noscitur a sociis provides that the meaning of doubtful words in a statute may be determined by reference to their association with related words and phrases.” See Cuccinelli v. Rector & Visitors of the Univ. of Virginia, 283 Va. 420, 432, 722 S.E.2d 626, 633 (2012)(quoting Andrews v. Ring, 266 Va. 311, 319, 585 S.E.2d 780, 784 (2003)).
7 asserts that testing would have revealed the problems with the
Chinese drywall and the defect is thus not latent.
TravCo responds that the latent defect exclusion is valid
and operates to preclude Ward from coverage under the policy.
TravCo asserts that the drywall in Ward’s home contained a
latent defect because the defect was “hidden or concealed” for
two years before Ward discovered a problem. It also argues
that Ward’s proposed construction of the exclusion violates
basic rules of grammar and insurance contract construction and
requires changing the word “or” to “and.” Moreover, TravCo
asserts that Ward attempts to use the doctrine of noscitur a
sociis inappropriately because the maxim cannot be used to
create ambiguity in a contract, only to resolve it. We agree
with TravCo.
Because there is no ambiguity in the phrase “[l]atent
defect, inherent vice, or any quality in property that causes
it to damage or destroy itself,” this Court need not look
beyond the plain meaning of the policy language to determine
whether it excludes damage caused by the Chinese drywall from
coverage. See, e.g., PBM Nutritionals, 283 Va. at 634, 724
S.E.2d at 713 (citation omitted); City of Chesapeake, 271 Va.
at 578, 628 S.E.2d at 541. The exclusion is plain in meaning
and is phrased in the disjunctive, using “or” to separate the
stated excluded losses. The disjunctive may not be omitted or
8 replaced with the conjunctive without doing violence to the
plain language of the policy. See, e.g., Commonwealth v.
Barker, 275 Va. 529, 544, 659 S.E.2d 502, 509 (2008) (“The
plain language . . . is in the disjunctive, not the
conjunctive, and indicates the listed medical conditions are to
be considered separately.”); D.C. McClain, 249 Va. at 135-36,
452 S.E.2d at 662 (“No word or clause in the contract will be
treated as meaningless if a reasonable meaning can be given to
it . . . .”).
This Court does not apply canons of construction to create
ambiguity where there is none, and Ward’s reliance upon the
doctrine of noscitur a sociis is unfounded. See Cuccinelli,
283 Va. at 432, 722 S.E.2d at 633; see also PBM Nutritionals,
283 Va. at 634, 724 S.E.2d at 713 (stating that liberal
construction is inappropriate in light of plain, unambiguous
exclusions). This Court, interpreting a marine policy, defined
“latent defect” as: “A defect not manifest, but hidden or
concealed, and not visible or apparent; a defect hidden from
knowledge as well as from sight; specifically, a defect which
reasonably careful inspection will not reveal; one which could
not have been discovered by inspection.” Glens Falls Ins. Co.
v. Long, 195 Va. 117, 121, 77 S.E.2d 457, 459 (1953).
Although, as Ward argues, the sulfuric content of the drywall
was potentially discoverable through testing after the product
9 was manufactured, the actual defect is the release of sulfuric
gases by the drywall. The future release of gas by the drywall
was not discoverable. Ward lived in his home for approximately
two years before discovering a problem with the drywall; the
defect was “hidden or concealed, and not visible or apparent.”
The damage caused by the drywall was the result of a
latent defect in the drywall. We therefore answer Subpart (a)
of the Certified Question in the affirmative and hold that the
policy unambiguously excludes from coverage damage caused by
the Chinese drywall installed in Ward’s residence.
Certified Question Subpart (b)
The faulty, inadequate or defective materials exclusion
states that TravCo does not insure for loss caused by: “Faulty,
inadequate or defective . . .[m]aterials used in repair,
construction, renovation or remodeling . . . of part or all of
any property whether on or off the ‘residence premises.’ ”
Ward argues that the “faulty” or “defective materials”
exclusion is not applicable to his loss. He asserts that the
policy does not define the terms “faulty” and “defective,” and
under the ordinary definitions of these terms, the exclusion
does not apply because the drywall maintains its form and
performs its function. He posits that such exclusions are
intended to prevent the insurer from insuring the quality of
performance under a contract for alteration to the property.
10 TravCo counters that the faulty materials exclusion
properly applies because drywall that releases sulfuric gas is
“faulty, inadequate or defective.” It points out that Ward
himself used the term “defective” to describe the drywall in
his home, doing so even after the filing of TravCo’s
declaratory judgment action. TravCo asserts that, as the
district court ruled, the drywall in Ward’s home is
“defective,” and “defective” and the other terms in the
exclusion are not limited to flaws that prevent an object from
serving its intended purpose. We agree with TravCo.
In construing the exclusion, this Court gives the language
its “ ‘usual, ordinary, and popular meaning.’ ” City of
Chesapeake, 271 Va. at 578, 628 S.E.2d at 541 (quoting D.C.
McClain, 249 Va. at 135-36, 452 S.E.2d at 662). The word
“faulty” is defined as “marked by a fault: having a fault,
blemish, or defect: imperfect, unsound.” Webster’s Third New
International Dictionary at 829 (1993); Oxford English
Dictionary 3 at 68619 (“Containing faults, blemishes or defects;
defective, imperfect, unsound.”). “Inadequate” is commonly
understood to mean “not adequate: insufficient, deficient.”
Webster’s Int’l Dict. at 1139; Oxford Eng. Dict. at 93024 (“Not
3 Oxford English Dictionary (2d ed. 1989, rev. online ed. June 2012), http://www.oed.com/view/Entry/68619 (last visited August 9, 2012) (hereinafter cited as “Oxford Eng. Dict. at [Entry No.]”).
11 adequate; not equal to requirement; insufficient.”).
“Defective” is likewise defined as “wanting in something
essential: falling below an accepted standard in regularity and
soundness of form or structure or in adequacy of function:
faulty, deficient, insufficient.” Webster’s Int’l Dict. at
591; Oxford Eng. Dict. at 48766 (“Having a defect or defects;
wanting some essential part of proper quality; faulty,
imperfect, incomplete.”).
The drywall in Ward’s home need meet only one of these
definitions for the exclusion to apply. These definitions are
not dependent solely upon the ability of the instrumentality to
maintain its form or perform its function, i.e., serve as a
wall. See Webster’s Int’l Dict. at 829 (“having a fault,
blemish, or defect: imperfect, unsound”). Assuming for the
sake of argument that these definitions directly encompass form
or function, the drywall at issue in this case could not
reasonably be said to perform its function; its sulfuric gases
rendered Ward’s home uninhabitable. Further, the drywall is
clearly defective. In fact, Ward himself described the drywall
as defective in his circuit court complaint 4 and interrogatory
answers. 5
4 “The Plaintiff brings this action because his family home . . . was built with defective drywall . . . .” 5 “I do not know the exact number of defective Chinese drywall samples installed in by [sic] home.”
12 We hold that the “faulty, inadequate, or defective”
materials exclusion is applicable to damage resulting from the
Chinese drywall. Certified Question Subpart (b) is answered in
the affirmative.
Certified Question Subpart (c)
The policy exclusion states that TravCo does not insure
for loss caused by “[s]mog, rust or other corrosion, mold,
fungi, wet or dry rot.” Ward maintains that the “rust or other
corrosion” exclusion does not apply in this instance because
those terms are not defined in the policy and the damage in his
home was not caused by corrosion, but was the corrosion itself.
Ward argues that this Court should construe the corrosion
exclusion using the principle noscitur a sociis and accordingly
find that the policy conflates corrosion with rust in a context
that suggests the exclusion refers to gradual elemental wear.
Ward asserts that a reasonable insured would believe the
corrosion exclusion was inapplicable because Ward’s loss was
not caused by corrosion and “rust” is ambiguous, and in this
context connotes damage gradually resulting from moisture.
TravCo argues that the corrosion exclusion bars coverage
for the damaged metals in Ward’s home in that there is no
dispute that such damage was caused by corrosion. TravCo
asserts that Ward’s argument that the damage was not caused by
corrosion because the damage was the corrosion itself is
13 unpersuasive in that the exclusion plainly refers to the
process of corrosion, as the district court correctly ruled.
Otherwise, the corrosion exclusion would be largely irrelevant,
as an external catalyst is always the cause of corrosion.
TravCo claims that the plain language of this exclusion does
not make a distinction between “naturally occurring” corrosion
and other corrosion, and Ward’s attempt to limit the definition
of corrosion to a gradual natural process under noscitur a
sociis is ineffective. Moreover, it notes that the corrosion
of metals in the Ward home was in fact a gradual process,
occurring over two years.
To construe this exclusion, this Court applies the plain
meaning of the terms “rust or other corrosion.” See, e.g.,
City of Chesapeake, 271 Va. at 578, 628 S.E.2d at 541 (citing
D.C. McClain, 249 Va. at 135-36, 452 S.E.2d at 662). Because
the exclusion is readily understood in accordance with the
plain meaning of its language, this Court need not employ
extraordinary canons of construction. See, e.g., PBM
Nutritionals, 283 Va. at 634, 724 S.E.2d at 713 (quoting 2
Appleman on Insurance 2d § 7.2).
Rust is defined as “the reddish porous brittle coating
that is formed on iron esp[ecially] when chemically attacked by
moist air and that consists essentially of hydrated ferric
oxide but usu[ally] contains some ferrous oxide and sometimes
14 iron carbonates and iron sulfates — compare corrosion.”
Webster’s Int’l Dict. at 1991; Oxford Eng. Dict. at 169112 (“A
coating formed on metal by oxidation or corrosion, and senses
relating to corrosion or deterioration.”). Corrosion is
defined as
the action, process, or effect of corroding: as . . . the action or process of corrosive chemical change not necessarily accompanied by loss of form or compactness; typically: a gradual wearing away or alteration by a chemical or electrochemical essentially oxidizing process (as in the atmospheric rusting of iron) . . . .
Webster’s Int’l Dict. at 512; Oxford Eng. Dict. at 42010 (“The
action or process of corroding; the fact or condition of being
corroded.”).
Reading these definitions in conjunction confirms the
clarity of the corrosion exclusion. These definitions and the
logical, common understanding of the term “corrosion” do not
draw a distinction between “naturally occurring” and other
corrosion. There is similarly no basis for reading a temporal
element into the instant corrosion exclusion; 6 the plain
language of the policy and commonly understood definition of
corrosion do not warrant such an interpretation.
Ward’s expert, Dr. Hejzlar, concluded in his affidavit:
“The corrosion of metal in the Ward . . . residence[] results
6 But see Webster’s Int’l Dict. at 512 (“a gradual wearing away”).
15 from exposure to reduced sulfur gases being emitted from the
Chinese drywall and interacting with the metal.” This
statement undoubtedly reflects a process of corrosion as
reflected in the definitions recited above. Ward’s argument
that the damage “was not caused by corrosion” because the
“damage was the corrosion itself” is without merit. Such a
construction would render this and similar corrosion exclusions
meaningless, as the district court noted.
The term “loss . . . [c]aused by . . . rust or other
corrosion,” is unambiguous and when interpreted according to
its plain meaning, encompasses the corrosion caused by the off-
gassing of sulfur from the Chinese drywall in Ward’s home. Any
such damage is excluded from coverage. This Court consequently
answers Certified Question Subpart (c) in the affirmative.
Certified Question Subpart (d)
The pollution exclusion at issue in this case provides
that TravCo does not insure for loss caused by:
Discharge, dispersal, seepage, migration, release or escape of pollutants unless the discharge, dispersal, seepage, migration, release or escape is itself caused by peril insured against under Coverage C.
Pollutants means 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 claimed.
16 Ward argues that the policy’s pollution exclusion is
“ambiguous, overbroad, unreasonable,” and inapplicable to his
loss. He claims that the process by which elemental sulfur
escaped the drywall, off-gassing, is not a “discharge” of
“pollutants” as contemplated by the exclusion or as a
reasonable person would understand.
Ward asserts that the doctrines of “reasonableness” and
“overbreadth” apply to allow coverage in the instant case. The
overbreadth in this case results from the broad category of
substances that could be termed “irritants” or “contaminants,”
and reasonableness is an issue because an ordinary policyholder
would understand the pollution exclusion as limited to ordinary
irritants or contaminants, not something such as the sulfur
off-gassing that occurred with the drywall.
TravCo argues 7 that the pollution exclusion properly
applies because the sulfuric gas emanating from the drywall was
an “irritant or contaminant” under the plain language of the
policy. It asserts that the sulfur gas in Ward’s house was a
contaminant because it was not “supposed to be” in the home and
it caused harm. The sulfur gas is likewise an irritant because
it caused Ward and his family to suffer nosebleeds and other
7 TravCo additionally argues that Ward waived a number of his arguments on insurance policy interpretation pursuant to Rule 5:25. This Court has never applied the rule in a certified question case, however, and we decline to do so now.
17 problems. The sulfuric gases moved from the drywall to the air
in the home by way of “[d]ischarge, dispersal, seepage,
migration, release or escape.” TravCo claims that these terms
are plain in meaning and sufficient to encompass the emission
of gas from the drywall.
The principles of contract and insurance coverage
exclusion interpretation recited previously in this opinion are
applicable to this final portion of the certified question.
However, it is additionally necessary to address Ward’s
assertion that doctrines of “reasonableness” and “overbreadth”
apply to invalidate the instant pollution exclusion.
This Court has noted various limitations on policy
exclusions, but any limitation pertaining to reasonableness
merely requires exclusions to be stated in “language that is
reasonable, clear, and unambiguous . . . .” E.g., Virginia
Farm Bureau Mut. Ins. Co. v. Williams, 278 Va. 75, 81, 677
S.E.2d 299, 302 (2009) (holding that policy did not clearly
prevent stacking of coverage); see also PBM Nutritionals, 283
Va. at 634, 724 S.E.2d at 713. This is the extent of any so-
called exclusion limits imposed by “reasonableness,” and the
related concept of overbreadth.
In Granite State Ins. Co. v. Bottoms, 243 Va. 228, 235,
415 S.E.2d 131, 135 (1992), for instance, our Court held a
policy exclusion unenforceable against an elder care home on
18 the basis of overbreadth and ambiguity. The exclusion was
phrased: “[T]he insurance does not apply to bodily injury . . .
due to . . . the rendering of or failure to render . . . any
service or treatment conducive to health . . . .” Id. at 232,
415 S.E.2d at 133. This Court held that the exclusion was
overbroad and ruled in favor of the insured because “one could
reasonably argue that almost any condition or function of an
adult home could be classified as ‘conducive to health’ of the
residents and, hence, any injuries negligently caused there are
excluded from coverage.” Id. at 235, 415 S.E.2d at 135.
Exclusions are to be construed according to their plain
language. See PBM Nutritionals, 283 Va. at 635-36, 724 S.E.2d
at 714. Although the release of sulfuric gases from Chinese
drywall is not traditional environmental pollution, this Court
does not construe pollution exclusions so narrowly. We
recently held in PBM Nutritionals that pollution endorsements
“broad, but not unlimited” in scope are enforced according to
their plain language. 283 Va. at 636, 724 S.E.2d at 714.
Bottoms is inapposite in the instant matter, because the
pollution exclusion could not reasonably be argued to
invalidate coverage for “almost any condition or function” in
the Ward home. 243 Va. at 235, 415 S.E.2d at 135. The
pollution exclusion in the TravCo policy is not overbroad or
19 unreasonable, and should be construed according to its plain
language.
Thus, we must determine whether (1) the sulfuric gases are
a “solid, liquid, gaseous or thermal irritant or contaminant,
including smoke, vapor, soot, fumes, acids, alkalis, chemicals
and waste”; and (2) the gases were present in Ward’s home as
the result of “[d]ischarge, dispersal, seepage, migration,
release or escape.”
The plain meaning of “irritant” is “tending to produce
irritation or inflammation.” Webster’s Int’l Dict. at 1197;
Oxford Eng. Dict. at 99857 (“Causing irritation, physical or
(rarely) mental; irritating.”). “Contaminant” is also defined
as “something that contaminates.” Webster’s Int’l Dict. at
491; Oxford Eng. Dict. at 40053 (“That which contaminates.”).
The importance of these definitions is not significant,
however, as the policy itself provides illustrations of
substances deemed to be contaminants: “smoke, vapor, soot,
fumes, acids, alkalis, chemicals and waste.”
It is beyond dispute that the sulfuric substance emanating
from the drywall is gaseous. It is described as such in Dr.
Hejzlar’s affidavit and Ward’s answer to the federal
declaratory judgment complaint, as well as in his state court
complaint and discovery responses. As for the nature of the
sulfuric gases, Ward asserted the presence of “odorous fumes in
20 the residence,” described the gas as “toxic,” and alleged that
it caused “skin rashes,” “lesions,” “sinus congestion,” and
“nosebleeds.” These properties plainly place the sulfuric
gases from the residence within the definition of “irritant or
contaminant” contemplated by the policy and commonly
understood.
Furthermore, reduced sulfur gas is a pollutant per the
relevant state and federal regulations. See 40 C.F.R.
§ 60.101(l) (referencing “[r]educed sulfur compounds”); 9
V.A.C. § 5-20-205(2) (same). This Court has previously
examined such regulations in determining whether a substance
falls within a policy definition of “contaminant.” See City of
Chesapeake, 271 Va. at 578, 628 S.E.2d at 541.
The issue of whether the sulfuric gases contaminated the
air in the Ward home due to “[d]ischarge, dispersal, seepage,
migration, release or escape” is likewise aided by the report
and affidavit of Dr. Hejzlar, which references the “reduced
sulfur gases being emitted from the Chinese drywall,”
“emissions from the Chinese drywall,” and states that “the Ward
home has Chinese drywall which has off-gassed.” Indeed, it is
difficult to envision how the sulfuric gases reached the air of
the Ward home if not by the means encompassed by the ordinary
meaning of “[d]ischarge, dispersal, seepage, migration, release
or escape.”
21 The sulfuric gases at issue in this case were a pollutant
within the purview of the exclusion, and we hold that the
pollution exclusion is applicable and unambiguously excludes
from coverage any damage resulting from the emission of gas
from the drywall. We therefore answer Certified Question
Subpart (d) in the affirmative.
Conclusion
Accordingly, for the reasons stated, we will answer all
subparts of the certified question in the affirmative.
Certified question answered in the affirmative.