13 leave the terminal until August 2005, who filed his complaint in August 2006, and
whose period of exposure during the statute of limitations period lasted approximately
a year.
At least four plaintiffs, however, were not exposed to biotoxins at the terminal
during the two years prior to the filing of their complaints - Mark Hudson, who left the
terminal in December 2003; Jay Frye, who ceased working at the terminal in May 2003;
Sadie Thomas-Frye, who ceased working at the terminal in December 2003; and Hayley
Saunders, who ceased working at the terminal in October 2000.
The final time period that is potentially relevant for statute of limitations
purposes would be the date that the plaintiffs discovered that they had been exposed to
biotoxins. Under such a discovery rule (urged by plaintiffs), all of their complaints
would potentially be timely since they all allege that they first learned they had been
exposed to biotoxins within two years of the filing of their complaints. If this theory
were adopted, there are at least disputed issues of fact on this point. 14
14 If a discovery rule were to be applied, the cause of action would not have accrued until a plaintiff discovered (or in the exercise of reasonable care should have discovered) that he or she was suffering from illnesses related to the mold problem in the building. See Bernier v. Raymark Industries Inc., 516 A.2d 534, 543 (Me. 1986). In this case there are some plaintiffs who were aware that there was mold in the building, but as to those plaintiffs there is a dispute as to whether, in the exercise of reasonable care, they should have recognized that their illnesses were mold-related. The most problematic plaintiff in this category is Robert Schrader. According to the summary judgment record, Schrader began experiencing health problems as soon as he started working in the terminal in 2002 and wrote a letter complaining of "the extensive existence of mold and mold spores throughout the facility" in February 2003. In that letter he also wrote that
mold litigation is on the rise and is viewed by some as the next ADA-type boon for plaintiff's attorneys. Throughout the country, municipalities and other governmental agencies have had to undertake expensive mold abatement processes that are far more extensive than asbestos abatement programs.
Schedule Dep. Ex. 11, page 4. Schrader argues that this only shows he recognized mold as a litigation risk rather than a health risk. See Plaintiffs' Response to City SMF <[ 209. While this contention may be far-fetched, there is still an issue of fact as to whether, even if it is obvious
14 Whether to adopt a discovery rule in this case depends on how the court
interprets the Law Court's decision in McLaughlin v. Superintending School Committee of
Lincolnville, 2003 l'v1E 114, 832 A.2d 782. McLaughlin concerned a claim brought against a
school district for health problems allegedly caused by poor air quality in the
Lincolnville Central School. In order to prevail against the statute of limitations defense
raised by the school district, the plaintiff had to show that there were disputed issues of
fact as to whether the plaintiff's cause of action accrued on or after September 21, 1999.
The plaintiff had remained in the school until April 14, 2000, see 2003 ME 114 err 6, 832
A.2d at 784, and had therefore been exposed to the allegedly unhealthy condition
within the statute of limitations period. The Law Court, expressly noting that "we need
not consider the application of a discovery rule exception here," ruled that the school
had not established that the plaintiff's injuries were not the result of his post September
21, 1999 exposure to the school's air. 2003 ME 114 err 23, 832 A.2d at 789.
Despite the fact that it had previously expressly declined to consider the
application of a discovery rule, the court then proceeded to discuss in dicta that the
school district had also not established that the plaintiff's guardian had reason to
understand the causal relationship between the plaintiff's health condition and the
school air quality. Id. err 24. Plaintiffs argue that this establishes that a discovery rule
was applied sub silentio in McLaughlin and should also be applied in this case.
The court declines to apply a discovery rule in this case. First, McLaughlin is too
slim a reed for the application of a discovery rule given its express statement that it was
declining to consider such a rule and given that it had already concluded that the
that mold was a litigation risk because it was a health risk, Schrader should have recognized that his own health issues could have resulted from mold.
15 plaintiff's exposure during the statute of limitations period was sufficient to defeat
summary judgment. 1s
Second, in an area where the Law Court has previously been clear that the
discovery rule has only been approved in extremely limited situations, trial courts
should defer to the Law Court with respect to any expansion of that rule. Previously
the Law Court had expressly declared that a discovery applies in only three situations:
legal malpractice, foreign object and negligent diagnosis medical malpractice, and
asbestosis. Johnston v. Dow and Coulombe Inc., 686 A.2d 1064, 1066 (Me. 1996). In several
of those instances, moreover, the Legislature has subsequently limited the reach of the
discovery rule. See 14 M.R.S. § 753-A; Johanson v. Dunnington, 2001 ME 169 <[<[ 8-9, 785
A.2d 1244, 1246-47; 24 M.R.S. § 2902; Dasha v. Maine Medical Center, 665 A.2d 993, 996
(Me. 1995). Moreover, even though the court in Johnston v. Dow and Coulombe Inc. listed
asbestosis as an instance where a discovery rule was applied, the Law Court's decision
in Bernier v. Raymark Industries actually stops short of adopting such a rule. See 516 A.2d
at 543.
Perhaps more importantly, in every instance where a discovery rule has been
adopted, one of two circumstances existed: either (1) the plaintiff had an injury which
had not manifested itself, e.g., Bernier, 516 A.2d at 542-43 ("sub clinical injury"); Bolton v.
Caine, 541 A.2d 924, 926 (Me. 1988) ("latent medical condition"), or (2) the plaintiff and
the alleged tortfeasor had a fiduciary relationship or another similar relationship (such
as a doctor-patient relationship) in which the plaintiff had reposed trust and confidence
IS Moreover, McLaughlin's further discussion in dicta of whether the plaintiff's guardian had reason to know of the causal relationship between plaintiff's illness and air quality purports to rely on Townsend v. Chute Chemical Co., 1997 ME 46 fJI 9, 691 A.2d 199, 202. However, the relevant portion of Townsend was not directed to whether the claimant in that case had reason to know of any causal relationship. Rather, it involved a question of whether the claimant had previously experienced a rash from the same cause - regardless of whether there was any awareness of the causal connection.
16 in the alleged tortfeasor and therefore would not readily suspect that a breach of duty
had occurred. See Dunelawn Owners Assoc. v. Gendreau, 2000 ME 94 1 14, 750 A.2d 591,
596 (discovery rule inappropriate in the absence of a fiduciary relationship).
In this case the medical problems experienced by the plaintiffs were not sub
clinical or latent, nor can it conceivably be argued that their relationship to the City of
Portland was a fiduciary relationship or a relationship of trust and confidence.
Summary judgment should therefore be granted with respect to the claims brought by
Jay Frye, Sadie Thomas-Frye, Mark Hudson, and Hayley Saunders.
As to whether the statute should run from the onset of plaintiffs' health problems
or from plaintiffs' last exposure, the court concludes that on this issue it should follow
McLaughlin's holding and look to period of last exposure. See 2003 ME 114 11 21, 23.
As noted above, even if the continuing tort theory were not applicable, the City has not
on this record eliminated the possibility that plaintiffs incurred some medical harm
during the two years prior to August 14, 2006. 16 Summary judgment is therefore denied
with respect to the timeliness of the claims brought by plaintiffs Bartlett, Crawford,
Delano, Hamill, Libby, Salisbury, Schrader, Wardwell, and Wilcox.
16 As a practical matter, the court recognizes that (with the exception of Bartlett) it may be improbable that plaintiffs suffered much appreciable harm during the brief period in which they remained in the terminal during the two years prior to the filing of their complaints. As noted above, many plaintiffs remained in the terminal for only eight days at the beginning of that time period and one plaintiff (Wardwell) was only in the terminal for two days during that period. The court is inclined, however, to conclude that this is an appropriate case to apply the continuing tort doctrine - where the harm is caused by the cumulative effect of the mold conditions for which the City allegedly bears responsibility, where no single incident can realistically be identified as the cause of significant harm, and where the result is a continuing wrong that terminates when the exposure to the harm terminates. See McLaughlin, 2003 ME 114 <[ 23 n.6, 832 A.2d at 789 n.6.
17 6. Damage Cap Per Single Occurrence
The final issue raised by the City's motion for summary judgment is whether the
$400,000 cap on damages for anyone occurrence applies in this case. Specifically, 14
M.R.S. § 8105(1) provides as follows:
In any claim or cause of action permitted by this chapter, the award of damages, including costs, against either a governmental entity or its employees, or both, may not exceed $400,000 for any and all claims arising out of a single occurrence.
To the court's knowledge, the Law Court has not yet provided guidance as to the
interpretation of "single occurrence" for purposes of § 8105(1). In a case of this nature,
moreover, the issue of what constitutes a single occurrence presents significant
difficulties.
The City argues that the occurrence here is its alleged failure to recognize and
remedy the buildup of a mold condition in the terminal that resulted in plaintiffs'
exposure to airborne biotoxins. If so, the City argues, there was one occurrence and the
nine remaining plaintiffs would potentially face an aggregate damage cap of $400,000.
The plaintiffs understandably disagree, arguing that the summary judgment record
raises factual disputes as to whether there were numerous distinct negligent acts or
omissions by the City in connection with the maintenance and repair of the terminalY
Both sides cite to federal cases and other jurisdictions that have considered the
interpretation of "per occurrence" language in insurance contracts or in other
governmental tort claims acts. See, e.g., Honeycomb Systems Inc. v. Admiral Insurance Co.,
17 Neither side argues that the number of occurrences should be measured by the number of injuries - i.e., that each plaintiff's injury is a separate occurrence subject to a separate $400,000 cap. It is the court's recollection that at oral argument, the parties agreed that such a contention would appear to be foreclosed by the wording of § 8105(1), which applies the $400,000 cap to "any and all claims" arising from a single occurrence.
18 567 F. Supp. 1400, 1405-06 (D. Me. 1983)/8 Home Indemnity Co. v. City of Mobile, 749 F.2d
659,663 (11 th Cir. 1984); Folz v. State of New Mexico, 797 P.2d 246,254 (N.M. 1990).19
For purposes of summary judgment, the court accepts that there were multiple
water intrusions at various locations in the terminal which allegedly resulted in "toxic
mold spores, toxic secondary byproducts of mold, mycotoxins, toxic bacteria, and
endotoxins present throughout the [terminal], from one end of the building to the
other." Plaintiffs' Opposition to Defendant's Summary Judgment Motion, dated
February 15, 2008, at 34. The question is whether each separate water intrusion and
each alleged failure on the part of the City to properly and promptly respond to each
separate water intrusion potentially constitute a separate occurrence.
Although plaintiffs argue that the answer to this question is yes, there are several
problems with their argument. First, the City's alleged liability is based on whether, as
a landlord acting in the exercise of reasonable care, it knew or should have discovered
and remedied the existence of a condition on the premises that endangered the
plaintiffs. See Restatement 2d Torts §§ 342,343. The alleged condition in question is the
overall hazard caused by toxic mold. This is a single problem, not a set of distinct
occurrences. Plaintiffs are not alleging that they suffered distinct injuries as a result of
separate instances of water intrusion.
18 The Honeycomb Systems case sought to apply Maine law but did not find any specific authority on point so instead applied general principles and looked to the law of other jurisdictions. 567 P.5upp. at 1404 n.2. 19 At least one of the cases cited by plaintiffs, however, is based in part on the principle that ambiguous language in an insurance contract should be construed in favor of coverage. See Norfolk & Western Ry. Co. v. Accident & Casualty Insurance Co., 796 P.5upp. 929, 936 (WD. Va. 1992). Statutory language rather than policy language is involved here, and there is no principle that ambiguities in the Tort Claims Act should be resolved against the governmental entity. To the contrary, see New Orleans Tanker Corp. v. Department of Transportation, 1999 ME 67 lJI 5, 728 A.2d at 675.
19 Second, it is illogical for the extent of the City's liability to turn on the number of
separate instances of water intrusion rather than the overall mold problem. There is no
good reason why there should be a dramatic difference in the amount that these
plaintiffs could potentially recover depending on whether the mold problem in the
terminal resulted from a series of separate water intrusions at various different
locations or whether it resulted from a single major water intrusion.
In the court's view, the argument that each water intrusion constituted a separate
occurrence cannot be squared with the intent of § 8105(1). By way of analogy, one may
consider a situation where a group of plaintiffs had been passengers on a bus who were
all injured when the bus collided with a City vehicle and there was evidence that the
City driver had been exceeding the speed limit and that his brakes had failed. Although
an argument could made that there were two separate occurrences - (1) excessive speed
and (2) brake failure - the court has very little doubt that only one occurrence would be
found.
The court therefore is inclined to adopt the interpretation of "single occurrence"
propounded by the Supreme Court of New Mexico in the Folz case:
[A]ll injuries proximately caused by the governmental agency's successive negligent acts or omissions that combined concurrently to create a singular, separate, and unitary risk of harm ...
797 P.2d 246, 254. However, the court will not enter a summary judgment finding that
this case involves a single occurrence within the meaning of § 8105(1). This is true for
two reasons. First, the court cannot conclude that the summary judgment record
forecloses the possibility that plaintiffs' claims arose out of more than one occurrence.
The terminal consisted of two buildings, the exposures occurred over a number of
years, and the record is devoid of evidence as to how many opportunities the City
allegedly had to recognize the problem and take remedial action.
20 Thus, the court does not necessarily disagree with the decision of the Eleventh
Circuit in a case cited by plaintiffs, Home Indemnity Co. v. City of Mobile, 749 F.2d at 663.
That case involved flood damage allegedly resulting from the City of Mobile's
negligence in the planning, construction, operation and maintenance of its drainage
system. The court concluded that "each discrete act or omission, or series of acts or
omissions, on the part of the City of Mobile which caused water to flood and damage
properties" was a single occurrence for purposes of a per occurrence clause in the City's
insurance policy. Id. (emphasis added). The court went on to say:
Thus, if on account of the City's negligence, a drain on one street was blocked so that water flooded the houses on that street, that would be one "occurrence" with a limit of $100,000 applicable to the total damage done to the houses. If, at some other location, on account of negligence on the part of the City, a storm sewer spilled over or broke open so that water flooded one house, that would be another occurrence with a total of $100,000 coverage available for the claims arising out of the damage to that house. If on the other side of the City, on account of the City's negligence, water flooding caused damage to 100 houses, that would be a third "occurrence" and there would be $100,000 in coverage applicable to all property damage proximately resulting from that negligent act.
Id.
In City of Mobile, the Eleventh Circuit did not expressly consider whether, if two
storm drains failed on the same street resulting in one flooded area, that would
constitute two "occurrences." However, plaintiffs are not contending here that they
were separately harmed by different acts of negligence with respect to separate
locations in the terminal. Instead, they are arguing, as noted above, that all of the
plaintiffs were exposed to biotoxins from all parts of the terminal, rather than from
isolated parts of the terminal. See Plaintiffs' SMF dated February 15, 2008, Additional
21 Facts <]I 47. 20 Nevertheless, the City has not established on this record that there was
only one series of alleged acts or omissions that injured all of the plaintiffs.
An additional reason to withhold summary judgment in this case is that the
court has become aware that there are decisions holding, with respect to per occurrence
clauses in insurance contracts, that separate toxic exposures can constitute separate
"occurrences." See, e.g., Metropolitan Life Insurance Co. v. Aetna Casualty & Surety Co., 765
A.2d 891, 905 (Conn. 2001). The court reserves decision on whether the reasoning in
those cases could apply outside of the insurance context, on whether those decisions are
correctly decided, and on whether they can be reconciled with the language and intent
of the Maine Tort Claims Act. However, the parties have not had the opportunity to
brief those issues.
If it is ultimately found that a single occurrence was involved here, the court
would derive no satisfaction from such a result. Damage caps have been found to
survive rational basis scrutiny, but it cannot be denied that they have arbitrary and
often unfair results. That is particul~rly true when they are applied on a per occurrence
basis to a group of claimants. 21 In large part, however, this is because § 8105(1) is not
intended to result in fairness to claimants but is instead designed to protect public
treasuries.
20 In addition, in contrast to City of Mobile, the liability of the City in the case at bar does not depend on whether the City was negligent with respect to repairs and maintenance. Rather it depends on whether the City was negligent in failing to recognize and remedy the mold Rroblem. 1 Such a cap also raises awkward procedural issues. For instance, it would appear to require that all of the claims arising out of a single occurrence (or group of related occurrences) be tried to verdict before any of the judgments can become final. This is necessary in order to determine whether the overall damages exceed $400,000 times the number of occurrences. If they do, it will be necessary to proportionately reduce each verdict in order to stay within the cap. The court agrees with the reasoning in Drummond v. City of Portland, Docket CV-83-18 (Superior Ct. Cumberland County) 1985 Me. Super. LEXIS 28, *6- *7 (Wernick, J.) that the per occurrence cap in § 8105(1) must be interpreted to apply regardless of how many lawsuits are brought or whether those cases are consolidated, but the practical problems created thereby are formidable.
22 In this context, it is instructive to consider the report of the Judiciary Committee
on Sovereign Immunity at the time the Tort Claims Act was first enacted in 1977. That
report observed that the Tort Claims Act adopted a closed end approach to the liability
of state and local governments, as opposed to the open-ended approach of the Federal
Tort Claims Act. While the Committee report recognized that an open ended approach
meant that persons who were actually injured and deserving of compensation were less
likely to be barred from recovery, the Committee concluded that the open ended
approach would subject governmental entities to increased costs and raised serious
questions of insurability. Report at 2-3. It therefore adopted the closed end approach
and the damage cap contained in § 8105(1). While that leads to a potentially arbitrary
and unfair result in this case, assuming that only a single occurrence is found and that
plaintiffs as a group would otherwise recover more than $400,000, this court is not
empowered to rewrite the statute to achieve fairer results. In the court's view, redress
for any unfairness in the application of § 8105(1) lies with the Legislature.
Finally, any conclusion that a $400,000 cap applies to all remaining claims in this
case would not be the end of the inquiry with respect to the limit of liability in this case.
Left to be decided is whether the City, by being named as an additional insured for
certain of the years in question, has expanded the limit of liability under 14 M.R.S. §
8116.
The entry shall be:
The City's motion for summary judgment is granted as to plaintiffs Jay Frye,
Sadie Thomas-Frye, Mark Hudson, and Hayley Saunders, based on the statue of
limitations and the complaints in Docket Nos. CV-06-448, CV-06-450, CV-06-451, and
CV-07-91 are therefore dismissed. In all other respects the City's motion for summary
judgment is denied at this time.
23 The clerk is directed to incorporate this order in the docket by reference pursuant
to Rule 79(a).
DATED: September /0, 2008.
~ Thomas D. Warren Justice, Superior Court
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