Auto Owners Ins v. City of Tampa Housing Auth.

• Decision Date: 01 November 2000
• Docket Number: No. 00-10283,00-10283
• Citation: 231 F.3d 1298
• Parties: (11th Cir. 2000) AUTO OWNERS INSURANCE CO., Plaintiff-Appellee, v. CITY OF TAMPA HOUSING AUTHORITY, a municipal agency, Defendant-Appellant.
• Court: U.S. Court of Appeals — Eleventh Circuit

Page 1298

231 F.3d 1298 (11th Cir. 2000)

AUTO OWNERS INSURANCE CO., Plaintiff-Appellee, v. CITY OF TAMPA HOUSING AUTHORITY, a municipal agency, Defendant-Appellant.

No. 00-10283.

United States Court of Appeals, Eleventh Circuit.

November 1, 2000.

November 13, 2000

Appeal from the United States District Court for the Middle District of Florida. (No. 98-00565-CIV-Y-26E), Richard A. Lazzara, Judge.

Before BLACK, BARKETT and FAY, Circuit Judges.

BARKETT, Circuit Judge:

The Housing Authority of the City of Tampa (the "Housing Authority") appeals from summary judgment awarded to Auto-Owners Insurance Company (the "Insurance Company") on the Insurance Company's suit for declaratory judgment. The summary judgment declares that because of a pollution exclusion clause in the policy covering the Housing Authority, the Insurance Company is liable for neither indemnification nor the costs of defense incurred by the Housing Authority when it was sued (the "Underlying Suit") for negligence. The Underlying Suit was brought against the Housing Authority by Sheletha Filmore, as mother and next friend of Darron Campbell, a child residing in a housing complex operated by the Housing Authority, alleging that Campbell had suffered injury by "ingesting and inhaling" lead from paint on the walls of the housing complex.

The district court held that because the injury alleged in the Underlying Suit arose out of the "discharge, dispersal, seepage, migration, release or escape of pollutants" it was specifically excluded from coverage under the policy. The Housing Authority argues two issues on appeal: first, that lead is not a pollutant as defined in the pollution exclusion clause; and second, that the lead in question did not move in the manner described in the pollution exclusion clause, to wit, through discharge, dispersal, seepage, migration, release or escape.

FACTS

The Insurance Company provided the Housing Authority with general commercial liability insurance from October, 1992 to October, 1995. Plaintiffs in the Underlying Suit alleged that, during the coverage period, Campbell was injured as a result of ingesting and inhaling lead from the old and crumbling paint on the walls of a Housing Authority dwelling. The Insurance Company agreed to defend the Housing Authority in the Underlying Suit under a reservation of rights. In this suit, the Insurance Company seeks a determination that it is not liable to the Housing Authority for the costs of defense or indemnification because the policy taken out by the Housing Authority contains a pollution exclusion clause which, the Insurance Company claims, covers liability arising from exposure to lead. The pollution exclusion "movement clause" states that it covers:

"Bodily injury" or "property damage" arising out of the actual, alleged or threatened discharge, dispersal, seepage migration, release or escape of pollutants.

"Pollutants" are defined to include:

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 reclaimed.

We review de novo a district court's grant of summary judgment, applying the same legal standards as the district court. See Whatley v. CNA Ins. Cos., 189 F.3d 1310, 1313 (11th Cir.1999). Summary judgment is appropriate if the evidence before the court shows that "there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c).

DISCUSSION

In Deni Assoc. of Florida, Inc. v. State Farm & Cas. Ins. Co., 711 So.2d 1135 (Fla.1998), the Florida Supreme Court, in enforcing pollution exclusions almost identical to the one in this case, reiterated the principle that if the policy language is clear and unambiguous, it must be enforced. Deni cautioned that a court should not "place limitations upon the plain language of a policy exclusion simply because we may think that it should have been written that way." Id. at 1139. In this case, both parties agree that the policy's pollution exclusion clause is unambiguous and that this case is governed by Florida law.

As to the first issue, under Florida law, the district court correctly found that lead is a "pollutant" under the terms of the policy. The district court found that lead is a "pollutant" under the policy because it is a chemical, and the pollution exclusion clause specifically lists "chemicals" in its definition of "pollutants." Moreover, lead is specifically recognized as...