124 F.3d 508 (3rd Cir. 1997), 96-5166, Pittston Co. Ultramar America Ltd. v. Allianz Ins. Co.

Docket Nº:(collectively
Citation:124 F.3d 508
Party Name:PITTSTON COMPANY ULTRAMAR AMERICA LIMITED, a Corporation of the State of Delaware; Ultramar Petroleum, Inc., a Corporation of the State of Delaware, Intervenor-Plaintiffs, v. ALLIANZ INSURANCE COMPANY, a Corporation of the State of California; Allstate Reinsurance Company, a Corporation of the State of Illinois; American Centennial Insurance Compan
Case Date:August 27, 1997
Court:United States Courts of Appeals, Court of Appeals for the Third Circuit
 
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124 F.3d 508 (3rd Cir. 1997)

PITTSTON COMPANY ULTRAMAR AMERICA LIMITED, a Corporation of

the State of Delaware; Ultramar Petroleum, Inc.,

a Corporation of the State of Delaware,

Intervenor-Plaintiffs,

v.

ALLIANZ INSURANCE COMPANY, a Corporation of the State of

California; Allstate Reinsurance Company, a Corporation of

the State of Illinois; American Centennial Insurance

Company, a Corporation of the State of Delaware; American

Insurance Group, a Corporation of the State of California,

a/k/a American Marine Insurance Group; American Marine

Underwriters, Inc., a Corporation of the State of Wisconsin;

Ancon Insurance Company, a Corporation; Citadel Assurance

Company, a Corporation of Canada, a/k/a Citadel General;

Employers Insurance Company of Wausau, a Corporation of the

State of Wisconsin, a/k/a American Marine Underwriters;

INSCO, a Corporation; Insurance Company of North America, a

Corporation of the State of Pennsylvania; Insituto De

Reasseguros Do Brasil; IRB, a British Corporation, a/k/a

Price Forbes Limited; The Lumbermens Mutual Insurance

Company, a Corporation of the State of Illinois; Mentor, a

Corporation; Societa Italiana Assicurazioni Transporti, a

Corporation of Canada, a/k/a S.I.A.T.; Sphere Drake

Underwriters, a Corporation; The Charter Oak Fire Insurance

Company, a Corporation of the State of Connecticut; The

Hartford Insurance Company, a Corporation of the State of

Connecticut; [*]Travelers Indemnity Company, a

Corporation of the State of Connecticut; United States Fire

Insurance Company, a Corporation of the State of New York;

Underwriters at Lloyd's of London, which include; Alliance

Insurance Company, Ltd.; Andrew Weir Insurance Company,

Ltd.; Bishopsgate Insurance Company, Ltd.; Drake Insurance

Company, Ltd.; Edinburgh Assurance Company, Ltd.; English

& American Insurance Company, Ltd.; Hansa Marine Insurance

Company, Ltd.; Insurance Company of Ireland, Ltd.; Orion

Insurance Company, Ltd.; Sphere Insurance Company, Ltd.;

Threadneedle Insurance Company, Ltd., with said companies

existing under the laws of the United States, the laws of

some sovereign power, or as an underwriter at Lloyds of

London; Does, 1-1000; Bellefonte Insurance Company, Ltd.;

Gibbs and Companies; Minister Insurance Company No. 3;

Nippon Fire & Marine Insurance Company (UK), Ltd.; Ocean

Marine Insurance Company, Ltd.; Skandia (UK) Insurance

Company, Ltd., per Orion Insurance Company, Plc. Group Et.;

Switzerland American Insurance Company, Ltd.; Yasuda Fire &

Marine Company, (UK) Ltd.; Andrew Weir Insurance Company,

Ltd. SBA/C; Andrew Weir Insurance Company, Ltd. Group;

Andrew Weir Insurance Company, Ltd. 'W'; Andrew Weir

Insurance Company, Ltd. NZSB; Chiyoda Fire & Marine

Insurance Company; Rochdale Insurance Company; Unigard

Mutual Insurance Company; Unione Italiana; United

Americas; Andrew Weir Insurance Company; Assicurzaioni

Generali S.P.A.; British Law Insurance Company; British

Reserve Insurance Company, Ltd. No. LA/C; Commercial Union

Assurance Company, Ltd.; Excess Insurance Company, Ltd.;

La Reunion Francaise S.A. D'Assurances; Minister Insurance

Company, Ltd. No. 2A/C; National Insurance Company Of New

Zealand, Ltd.; Nippon Fire & Marine Insurance Company,

Ltd.; Nippon Fire & Marine Insurance Company, Ltd. TLA/C;

English & American Insurance Company, Ltd.; Northern

Assurance Company, Ltd. Group; Phoenix Assurance Company,

Ltd.; Polaris-Norske SJO Insurance Company, Ltd. "NT"A/C;

Provincial Insurance Public Limited Company; Road Transport

Insurance Company, Ltd.; Road Transport & General Insurance

Company, Ltd.; Scottish Lion Insurance Company, Ltd.;

Protective Insurance Company

Pittston Company; Allianz Insurance Company; Allstate

Reinsurance Company; American Centennial Insurance Company;

American Insurance Group; American Marine Underwriters,

Inc.; Ancon Insurance Company; Citadel Assurance Company;

Employers Insurance Company of Wausau; INSCO; Insurance

Company of North America; Insituto de Reasseguros do

Brasil; IRB; The Lumbermens Mutual Insurance Company;

Mentor; Societa Italiana Assicurazioni Transporti; Sphere

Drake Underwriters; The Charter Oak Fire Insurance Company;

The Hartford Insurance Company; Travelers Insurance

Company; United States Fire Insurance Company;

Underwriters at Lloyd's of London; Alliance Insurance

Company, Ltd.; Andrew Weir Insurance Company, Ltd.;

Bishopsgate Insurance Company, Ltd.; Drake Insurance

Company, Ltd.; Edinburgh Assurance Company, Ltd.; English

& American Insurance Company, Ltd.; Hansa Marine Insurance

Company, Ltd.; Insurance Company of Ireland, Ltd.; Orion

Insurance Company, Ltd.; Sphere Insurance Company, Ltd.;

Threadneedle Insurance Company, Ltd.; Does; Bellefonte

Insurance Company, Ltd., Intervenor-Defendants.

Ultramar America Limited, and Ultramar Petroleum, Inc.,

(collectively "Ultramar"), Appellants No. 96-5166.

The Pittston Company ("Pittston"), Appellant No. 96-5167.

Nos. 96-5166, 96-5167.

United States Court of Appeals, Third Circuit

August 27, 1997

Argued March 10, 1997.

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John E. Heintz (argued), Christopher H. Marraro, Steven N. Gersten, Howrey & Simon, Washington, DC, John M. Angello, Carella, Byrne, Bain, Gilfillan, Cecchi, Stewart & Olstein, Roseland, NJ, for Appellants in No. 96-5166, Ultramar America Limited and Ultramar Petroleum, Inc.

Robert N. Sayler (argued), William F. Greaney, Robert A. Long, Jr., Covington & Burling, Washington, DC, Timothy A. Vanderver, Jr., David J. Farber, Patton Boggs, L.L.P., Washington, DC, for Appellant in No. 96-5167, The Pittston Company.

William B. McGuire, John J. Henschel, Tompkins, McGuire & Wachenfeld, Newark, NJ, Donald T. Rave, Jr., George R. Daly, Stacey Tranchina, Bigham, Englar, Jones & Houston, New York City, for Allianz Insurance Company; Ancon Insurance Company; The Hartford Insurance Company; Chiyoda

Page 512

Fire & Marine Insurance Company; Rochdale Insurance Company; Unigard Mutual Insurance Company; Unione Italiana; United Americas.

Wm. Gerald McElroy, Jr. (argued), Zelle & Larson, Waltham, MA, for American Marine Underwriters, Inc.; Employers Insurance Company of Wausau.

Martin R. Baach, Bruce R. Grace (argued), Nussbaum & Wald, Washington, DC, for INSCO; Sphere Drake Underwriters; Nippon Fire & Marine Insurance Company (U.K.) Limited; Skandia (UK) Insurance Company, Ltd., per Orion Insurance Company, PLC. Group; Switzerland American Insurance Company; British Reserve Insurance Company, Ltd. No. LA/C; National Insurance Company of New Zealand, Ltd.; Phoenix Assurance Company, Ltd.; Polaris-Norske SJO Insurance Company, Ltd.; Provincial Insurance Public Limited Company; Road Transport & General Insurance Company, Ltd.; Nippon Fire & Marine Insurance Company, Ltd.; Nippon Fire & Marine Insurance Company, Ltd. TLA/C.

Paul R. Koepff (argued), Paul M. Alfieri, O'Melveny & Myers, New York City, for Insurance Company of North America.

James A. Scarpone, Hellring, Lindeman, Goldstein & Siegal, Newark, NJ, Neal M. Glazer (argued), D'Amato & Lynch, New York City, Martin R. Baach, Bruce R. Grace, Nussbaum & Wald, Washington, DC, for Underwriters at Lloyd's of London; Bishopsgate Insurance Company; Insurance Company of Ireland; Threadneedle Insurance Company; Minister Insurance Company No. 3; Ocean Marine Insurance Company; Assicurzaioni Generali S.P.A.; British Law Insurance Company; Commercial Union Assurance Company, Ltd.; Excess Insurance Company, Ltd.; La Reunion Francaise S.A. D'Assurances; Northern Assurance Company, Ltd. Group; Scottish Lion Insurance Company, Ltd.; Andrew Weir Insurance Company, Ltd.; Minister Insurance Company, Ltd. No. 2A/C; Road Transport Insurance Company.

Joseph R. McDonough, Graham, Curtin & Sheridan, Morristown, NJ, for Yasuda Fire & Marine Company, (UK) Ltd.

Edward G. Madden, Jr., Mattson & Madden, Newark, NJ, for Protective Insurance Company.

Joseph L. Ruby, Wiley, Rein & Fielding, Washington, DC, for Travelers Indemnity Company.

Before: MANSMANN and LEWIS, Circuit Judges and DUPLANTIER, [**] District Judge.

OPINION OF THE COURT

LEWIS, Circuit Judge.

These related appeals involve a multi-party insurance dispute arising from a polluted oil transfer terminal, "Tankport," which sits on the western shore of upper New York Harbor in Jersey City, New Jersey. Appellants Ultramar America Limited and Ultramar Petroleum, Inc. (collectively "Ultramar") purchased Tankport from Appellant The Pittston Company ("Pittston"). As part of the purchase agreement, Pittston agreed to indemnify Ultramar for any environmental damage caused during Pittston's ownership of Tankport. Ultramar has since decommissioned Tankport and faces extensive environmental remediation costs. Although Ultramar and Pittston have settled the question of liability between them, they each seek relief from their respective insurance carriers. The district court granted summary judgment in favor of the insurers on all of Ultramar's claims and most of Pittston's claims.

On appeal, there are two primary questions before us. First, are Ultramar's and Pittston's claims for insurance coverage barred by the doctrine of known loss? Second, do Pittston's marine insurance policies preclude coverage for land-based pollution? We will conclude that both of the above questions should be answered in the negative. Accordingly, we will...

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