85 F.3d 1527 (11th Cir. 1996), 95-4284, City of Delray Beach, Fla. v. Agriculture Ins. Co.

Docket Nº:95-4284.
Citation:85 F.3d 1527
Party Name:CITY OF DELRAY BEACH, FLORIDA, Plaintiff-Counter Defendant-Appellant, Lawrence A. Razette, John J. Razette, Intervenor-Plaintiffs, v. AGRICULTURAL INSURANCE CO., Mission Insurance Co., Mission National Insurance Co., Mission American Insurance Co., Aetna Casualty & Surety Co., Hartford Accident and Indemnity Co., Century Indemnity Company, Continen
Case Date:June 25, 1996
Court:United States Courts of Appeals, Court of Appeals for the Eleventh Circuit
 
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Page 1527

85 F.3d 1527 (11th Cir. 1996)

CITY OF DELRAY BEACH, FLORIDA, Plaintiff-Counter Defendant-Appellant,

Lawrence A. Razette, John J. Razette, Intervenor-Plaintiffs,

v.

AGRICULTURAL INSURANCE CO., Mission Insurance Co., Mission

National Insurance Co., Mission American Insurance Co.,

Aetna Casualty & Surety Co., Hartford Accident and Indemnity

Co., Century Indemnity Company, Continental Insurance

Company, Pacific Employers Insurance Co., American

Centennial Insurance Co., Universal Security Insurance Co.,

Mutual Fire, Marine & Inland Insurance Co.,

Defendants-Intervenor Defendants-Appellees,

Illinois Insurance Exchange, Transco Syndicate # 1, Ltd.,

Defendants-Intervenor-Defendants

Counter-Claimants-Appellees.

No. 95-4284.

United States Court of Appeals, Eleventh Circuit

June 25, 1996

Steven R. Berger, Berger & Chafetz, Miami, FL, for appellant.

Linda B. Foster, Neely & Player, Atlanta, GA, Bradford A. Thomas, Miami, FL, Dennis M. Flannery, Nancy L. Manzer, Wilmer, Cutler & Pickering, Washington, DC, Paul L. Nettleton, Miami, FL, Barry S. Bendetowies, Bradley Fischer, Ft. Lauderdale, FL, Carl D. Motes, Tallahassee, FL, for Aetna Casualty.

William A. Posey, Keating, Muething & Klekamp, Cincinnati, OH, Edward R. Nicklaus, Coral Gables, FL, William R. Wicks, James W. McCready, Coral Gables, FL, for Transco & Illinois Ins.

William S. Daskam, Tampa, FL, for Continental Ins.

Ignatius Melito, New York City, for Hartford.

Page 1528

Appeal from the United States District Court for the Southern District of Florida (No. 91-8281-CV-SM), Stanley Marcus, Judge.

Before HATCHETT, Circuit Judge, FAY, Senior Circuit Judge, and WOOD [*], Senior Circuit Judge.

HATCHETT, Circuit Judge:

We affirm for all the reasons stated in the district court's order dated September 9, 1994, granting summary judgment in favor of the appellees and against the City of Delray Beach. We attach the order as an "Appendix."

APPENDIX

CITY OF DELRAY BEACH, Plaintiff,

V.

AGRICULTURAL INSURANCE COMPANY, MISSION INSURANCE COMPANY, AETNA CASUALTY AND SURETY COMPANY, HARTFORD ACCIDENT AND INDEMNITY COMPANY, ILLINOIS INSURANCE EXCHANGE, CALIFORNIA INSURANCE COMPANY, CONTINENTAL INSURANCE COMPANY, PACIFIC EMPLOYERS INSURANCE COMPANY, AMERICAN CENTENNIAL INSURANCE COMPANY, UNIVERSAL SECURITY INSURANCE COMPANY, MUTUAL FIRE, MARINE & INLAND INSURANCE COMPANY, AND TRANSCO SYNDICATE # 1, LTD., Defendants.

CASE NO. 91-8281-CIV-MARCUS

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA

ORDER

THIS CAUSE comes before the Court upon (1) Defendant Transco Syndicate # 1, Ltd. and Illinois Insurance Exchange's (collectively "Transco Syndicate") motion for summary judgment, filed July 6, 1992; and (2) California Union Insurance Company's ("California Union") motion for summary judgment, filed on November 18, 1993. As to the first motion, United States Magistrate Judge Stephen T. Brown, upon an order of reference, issued a Report and Recommendation on September 27, 1993, recommending that Transco Syndicate's motion for summary judgment be granted. Plaintiff, the City of Delray Beach, timely filed an objection to the Report and Recommendation. Among a number of issues raised in the motions, the parties present the following issue of first impression under Florida law: whether the "personal injury endorsements" contained in the Defendants' comprehensive general insurance policies provide coverage for the environmental contamination that occurred in this case. For the reasons that follow, we conclude, as a matter of law, that the moving parties' CGL policies do not provide such coverage under Florida law. Accordingly, Transco Syndicate's motion for summary judgment is GRANTED and California Union Insurance Company's motion for summary judgment is GRANTED.

I.

The factual and procedural background of the motions for summary judgment filed in this matter are not in dispute. On April 21, 1988, in a separate action, the City of Delray Beach brought suit in the Circuit Court of the Fifteenth Judicial Circuit in and for Palm Beach County, Florida, against a number of defendants for allegedly polluting the city's water supply. See City of Delray Beach v. Aero-Dri Corp., et al., Case No. 88-3672-AJ. It appears that the Defendants failed to dispose of their waste solvents at a proper disposal facility and polluted the ground water through the discharge of those solvents. The City of Delray Beach alleged a continuous and systematic pattern of improper waste disposal and contamination of the city's drinking water. A jury returned a verdict in the case for the City in the amount of $8,697,488.00 for past and future compensatory damages.

Page 1529

The City of Delray Beach now brings this cause of action against numerous insurers, alleging that these insurance companies provided various amounts of coverage to the defendants in the underlying state court action. Three of the defendant insurance companies here have filed motions for summary judgment arguing that as a matter of law their insurance policies do not provide coverage for the cause of action in the underlying state case. Defendants Transco Syndicate # 1, Ltd., and Illinois Insurance Exchange jointly wrote three commercial general liability insurance policies insuring two of the defendants in the underlying state court action: (1) Policy # DOL02250, providing primary coverage of $500,000 for the period of October 1, 1985 through October 1, 1986; (2) Policy # DOL07567, providing primary coverage of $1,000,000 for the period of October 1, 1986 through October 1, 1987; and (3) Policy # DOL104251, providing excess coverage of $1,000,000 for the period of October 1, 1987, through October 1, 1988. California Union issued one policy that is at issue in this case, Policy No. 2204 EPO 01287, providing coverage for a policy period from October 1, 1987 through October 1, 1988.

Transco Syndicate and California Union have filed separate motions for summary judgment asking this Court to find, as a matter of law, that they do not owe any coverage under the above-stated insurance policies to the City of Delray Beach for liability incurred by the defendants in the underlying state court action. In short, the insurance companies argue that the "pollution exclusion clauses" contained in their respective comprehensive general liability insurance policies preclude coverage to their insureds for any liability for the environmental contamination that occurred in this case. Plaintiff has responded that Transco Syndicate and California Union are liable on the following independent grounds: (1) the pollution exclusion clauses contained in the comprehensive general liability insurance policies do not preclude coverage to the insureds for the environmental contamination that occurred in this case; and (2) that even if the pollution exclusion clauses do generally preclude coverage, the insurance companies separately owe coverage under "personal injury endorsements" contained in each of the policies.

Procedurally, this Court referred Transco Syndicate's motion for summary judgment to United States Magistrate Judge Stephen T. Brown for a Report and Recommendation. Based upon the Supreme Court of Florida's recent ruling in Dimmitt Chevrolet, Inc. v. Southeastern Fidelity Insurance Corp., 636 So.2d 700 (Fla.1993), reh'g denied, March 31, 1994, the Magistrate Judge issued a Report and Recommendation in which he recommended that the motion for summary judgment be granted in favor of the Defendants as to both theories of recovery that the Plaintiff had asserted. We now consider both motions for summary judgment together.

II.

The standard to be applied in reviewing summary judgment motions is stated unambiguously in Rule 56(c) of the Federal Rules of Civil Procedure:

The judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show 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.

It may be entered only where there is no genuine issue of material fact. Moreover, the moving party has the burden of meeting this exacting standard. Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970).

In applying this standard, the Eleventh Circuit has explained:

In assessing whether the movant has met this burden, the courts should view the evidence and all factual inferences therefrom in the light most favorable to the party opposing the motion. Adickes, 398 U.S. at 157, 90 S.Ct. at 1608; [Environmental Defense Fund v.] Marsh, 651 F.2d at 991 [ (5th Cir.1981) ]. All reasonable doubts about the facts should be resolved in favor of the non-movant. Casey

Page 1530

Enterprises v. Am. Hardware Mutual Ins. Co., 655 F.2d 598, 602 (5th Cir.1981). If the record presents factual issues, the court must not decide them; it must deny the motion and proceed to trial. Marsh, 651 F.2d at 991; Lighting Fixture & Elec. Supply Co. v. Continental Ins. Co., 420 F.2d 1211, 1213 (5th Cir.1969). Summary judgment may be inappropriate even where the parties agree on the basic facts, but disagree about the inferences that should be drawn from these facts. Lighting Fixture & Elec. Supply Co., 420 F.2d at 1213. If reasonable minds might differ on the inferences arising from undisputed facts, then the court should deny summary judgment. Impossible Electronic [Techniques, Inc. v. Wackenhut Protective Systems, Inc.], 669 F.2d [1026] at 1031 [ (5th Cir.1982) ]...

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