United States Fidelity & Guaranty Co. v. Lehigh Valley Ice Arena, Inc.

121 F. App'x 976
CourtCourt of Appeals for the Third Circuit
DecidedFebruary 18, 2005
DocketNo. 04-1832
StatusPublished
Cited by1 cases

This text of 121 F. App'x 976 (United States Fidelity & Guaranty Co. v. Lehigh Valley Ice Arena, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Third Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States Fidelity & Guaranty Co. v. Lehigh Valley Ice Arena, Inc., 121 F. App'x 976 (3d Cir. 2005).

Opinion

OPINION OF THE COURT

VAN ANTWERPEN, Circuit Judges.

Before us is an appeal by Appellant Lehigh Valley Ice Arena (“Lehigh Valley”) and several injured parties (acting as intervenors) (collectively “Appellants”) from a grant of summary judgment in favor of United States Fidelity and Guaranty Company (“Appellee”). For the reasons below, we affirm the well-reasoned decision of the District Court.

I. Facts

On September 29, 2002, an intercollegiate hockey game was played at Lehigh Valley’s facility, where it is alleged that 19 members of the Millersville University ice hockey team sustained serious pulmonary-related injuries as a result of the inhalation of carbon monoxide, nitrogen dioxide, and other gases emanating from the in[978]*978complete combustion of propane in a malfunctioning Zamboni machine. These gases allegedly passed through the ventilation system of the facility and were released into the locker room used by the Millers-ville players.1

Eighteen members of the team, as well as one spouse, filed suit in the Philadelphia Court of Common Pleas on July 10, 2003, against Lehigh Valley. The remaining hockey player filed a separate action on November 19, 2003. While initially defending Lehigh Valley in both actions, on October 14, 2003, Appellee disclaimed all coverage under the “pollution exclusion” of its insurance agreement with Lehigh Valley, and informed Lehigh Valley that it would cease defending both actions as of December 14, 2003.

On the same date that it disclaimed coverage, Appellee filed a declaratory judgment action in the United States District Court for the Eastern District of Pennsylvania seeking a declaration that it was not obligated to defend or indemnify Lehigh Valley in connection with either state court action. Both Appellee and Le-high Valley (joined by the intervening injured players) subsequently filed cross motions for summary judgment. On March 3, 2004, the District Court granted Appellee’s Motion for Summary Judgment and denied Appellants’ Cross-Motion for Summary Judgment. This appeal followed.

II. Jurisdiction and Standard of Review

The District Court had jurisdiction pursuant to 28 U.S.C. § 1332. Our jurisdiction is pursuant to 28 U.S.C. § 1291.

Our review of the District Court’s grant of summary judgment is de novo. See Curley v. Klem, 298 F.3d 271, 276 (3d Cir.2002). We will affirm as long as there were no genuine issues of material fact before the District Court and the moving party was entitled to judgment as a matter of law. See id. at 276 (quoting Fed. R.Civ.P. 56(c)).

III. Discussion

It is undisputed that this insurance contract should be interpreted according to Pennsylvania law. A court interpreting an insurance contract must “ascertain the intent of the parties as manifested by the language of the written instrument.” Standard Venetian Blind Co. v. Am. Empire Ins., 503 Pa. 300, 469 A.2d 563, 566 (Pa.1983). If an insurance policy provision is ambiguous, it will be construed against the insurer and in favor of the insured party. State Farm Fire & Cas. Co. v. MacDonald, 850 A.2d 707, 710 (Pa.Super.Ct.2004). An ambiguity exists if a provision, when viewed in the context of the entire policy, is “reasonably susceptible of different constructions and capable of being understood in more than one sense.” Medical Protective Co. v. Watkins, 198 F.3d 100, 103 (3d Cir.1999) (quoting Reliance Ins. Co. v. Moessner, 121 F.3d 895, 900 (3d Cir.1997)) (internal quotations marks omitted). Where, however, “the language of an insurance contract is clear and unambiguous, a court is required to enforce that language.” Id. at 103 (citing Standard Venetian Blind, 469 A.2d at 566).

Appellants contend that the District Court erred in concluding that the injuries underlying this action fell outside the coverage provided by the insurance agreement between Appellee and Lehigh Valley. Specifically, they contend that the District Court erred in finding that (1) no exception to the pollution exclusion applied, (2) the policy was unambiguous as a matter of law, and (3) the doctrine of reasonable [979]*979expectations was inapplicable to the instant case.

Turning first to whether there is an applicable exception to the general pollution 2 exclusion, we conclude that the pollution exclusion applies without exception to the instant case. Section I(2)(f)(l)(a) reads:

This insurance does not apply to ... “[b]odily injury” or “property damage” arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of “pollutants” ... [a]t or from any premises, site or location which is or was at any time owned or occupied by, or rented or loaned to, any insured.

There is no dispute that (a) bodily injury arose (b) out of the discharge of pollutants (carbon monoxide and nitrogen dioxide) (c) at the Lehigh Valley ice rink. Section I(2)(f)(l)(a) is thus applicable. Furthermore, the section I(2)(f)(l)(a)(i) exception to the section I(2)(f)(l)(a) exclusion is not applicable. Section I(2)(f)(l)(a)(i) reads:

[However, this subparagraph does not apply to] “[b]odily injury” if sustained within a building and caused by smoke, fumes, vapor or soot from equipment used to heat that building.

(emphasis added). As the District Court concluded, it is clear that, in order for this exception to be applicable, the heating system itself must have caused the pollution. The rink’s heating system did not release the injurious pollutants — it merely served, as described by the District Court, as a “conduit.” We acknowledge that the Appellant-intervenors’ complaints plead that the installation of a dimensionally incorrect filter in the heating system allowed the pollutants to become concentrated within the locker room. However, this allegation is of no moment because it does not address the predicate of section I(2)(f)(l)(a)(i), namely that the equipment used to heat the rink was the source of the injurious pollution. No party has suggested that the pollutants were caused by the heating system. As such, the section I(2)(f)(l)(a)(I) exception is inapplicable.

We further conclude that there is no ambiguity between section I(2)(f)(l)(a) and section I(2)(f)(l)(d), as section I(2)(f)(l)(d) is inapplicable to the instant case. Section I(2)(f)(l)(d) reads, in relevant part:

This insurance does not apply to ... “[bjodily injury” or “property damage” arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of “pollutants” ...

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121 F. App'x 976, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-fidelity-guaranty-co-v-lehigh-valley-ice-arena-inc-ca3-2005.