Grand River Lime Co. v. Ohio Cas. Ins. Co.

• Decision Date: 25 April 1972
• Citation: 289 N.E.2d 360,32 Ohio App.2d 178
• Parties: , 61 O.O.2d 200 GRAND RIVER LIME CO., Appellant, v. OHIO CASUALTY INSURANCE CO., Appellee.
• Court: Ohio Court of Appeals

Page 178

32 Ohio App.2d 178

289 N.E.2d 360, 61 O.O.2d 200

GRAND RIVER LIME CO., Appellant, v. OHIO CASUALTY INSURANCE CO., Appellee.

Court of Appeals of Ohio, Tenth District, Franklin County.

April 25, 1972.

Syllabus by the Court

1. Where the terms of a general liability policy provide that the insurer is obligated to pay damages caused to property by an occurrence which is defined within the policy to mean an accident, including injurious exposure to conditions, the occurrence need not be a sudden event and may include manufacturing activity which produces emissions of industrial wastes into the atmosphere over a period of time.

2. Where allegations as set forth in one or more causes of action in a complaint against an insured could bring the action within the coverage of the policy, the insurer is under a duty to defend such action, even though the other causes of action within such complaint are held not to be within such coverage.

Glander, Brant, Ledman & Newman, Columbus, for appellant.

Vorys, Sater, Seymour & Pease, Columbus, for appellee.

HOLMES, Judge.

This is an appeal of a summary judgment in favor of the defendant, Ohio Casualty Insurance Company, and against the plaintiff, Grand River Lime Company, in the Common Pleas Court of Franklin County, Ohio.

Briefly, the background of the matter is that Grand River filed a declaratory judgment action in the Franklin County Common Pleas Court seeking a determination of the question of whether Ohio Casualty had the obligation pursuant to a contract of insurance to provide a defense for Grand River in a civil action pending against the latter in Lake County, Ohio.

The Lake County suit is a class action brought by some 200 residents of the village of Fairport Harbor against Grand River, in which the complaint alleges property damage and personal injury to members of the class caused by Grand River in its quarrying and manufacturing operations as a result of the emission of air pollutants for a period of some seven years.

Grand River filed a motion for summary judgment in the declaratory judgment action. Ohio Casualty followed with its own motion for summary judgment. The trial court overruled Grand River's motion and sustained the motion of Ohio Casualty.

The plaintiff, appellant herein, sets forth two assignments of error, one that the trial court erred in sustaining the appellee's motion for summary judgment; and, conversely that the trial court erred in failing to sustain the appellant's motion for summary judgment.

The first assignment of error is subdivided into three branches as follows:

'A) A Pleading Containing any Claim Potentially Within The Coverage of a Liability Insurance Policy Requires The Insurer to Provide a Defense To Its Insured.

'B) The Claims Set Forth in the First Cause of Action of the Amended Petition Filed in the Lake County Suit Constitute an 'Occurrence' as Defined in the General Liability Policy.

'C) Appellant Fully Complied With All Conditions of the Policy of Insurance and, Specifically, Gave Adequate Notice of the Lake County Claim to Appellee.'

However, in that the defendant, appellee in this action, has not argued, either in its brief or orally (subdivision (C) relating to the question of adequate notice) we shall pass this point and assume that any complaint as to notice has been effectively waived.

(A)

The question presented in this branch of the assignments of error concerns the duty of the insurance carrier to defend its insured within the framework of the particular wording of the contract of insurance, and in light of the allegations of the pleadings in the action as brought against the insured in Lake County.

The general rule as to the duty of an insurance company to defend has been well stated in the case of Lessak v. Metropolitan Cas. Ins. Co. (1958), 168 Ohio St. 153, 151 N.E.2d 730, where, in the second paragraph of the syllabus the following is found:

'2. The sole test as to the duty of an insurance company, under a policy of liability insurance, to defend an action against the insured is the allegations of the petition in the action against the insured, and where such petition brings the action within the coverage of the policy, the insurer is required to make defense, regardless of the ultimate outcome of the action or the liability to the insured. (Socony-Vacuum Oil Co. v. Continental Casualty Co., 144 Ohio St. 382, 59 N.E.2d 199, approved and followed.)'

Under the terms of the general liability policy as issued by Ohio Casualty to Grand River, Ohio Casualty agreed as follows:

'The company will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of

'Coverage A. bodily injury or

'Coverage B. property damage to which this insurance applies, caused by an occurrence, and the company shall have the right and duty to defend any suit against the insured seeking damages on account of such bodily injury or property damage, even if any of the allegations of the suit are groundless, false or fraudulent, and may make such investigation and settlement of any claim or suit as it deems expedient, but the company shall not be obligated to pay any claim or judgment or to defend any suit after the applicable limit of the company's liability has been exhausted by payment of judgments or settlements.'

Within the policy, we find a definition section which provides the definition of 'occurrence' as follows:

"Occurrence' means an accident, including injurious exposure to conditions, which results, during the policy period, in bodily injury or property damage neither expected nor intended from the standpoint of the insured * * *.'

As stated previously, in order to determine the obligation of the insurer to defend, we must view the above quoted sections of the policy in the light of the allegations of the petition as filed against the insured.

The amended petition in the Lake County case contains two causes of action, each founded upon different theories of liability. The first cause of action contains allegations of nuisance and trespass. It is alleged that Grand River was guilty in the following respects.

'* * * (In) allowing said industrial wastes to be emitted in large quantities from their stacks and to settle on the person, houses, automobiles and other chattels of the plaintiff, constitute a continuing nuisance and trespass in the following particulars, to wit:

'(1) In emitting large quantities of industrial wastes into the atmosphere through their stacks when the defendants knew or should have known that such materials would come to rest on the person, houses, automobiles and chattels of the plaintiff and damage the same;

'(2) In failing to provide for adequate safeguards to prevent the said industrial wastes from entering the atmosphere and settling on the person, lands and houses and automobiles and chattels of others, and more particularly, the person and houses and automobiles and chatteles of the plaintiff, and causing damage thereto.

'(3) In failing to use its own property and premises so as not to injure the person, property and chattels of another, and more particularly, the person, property and chattels of the plaintiff.'

The second cause of action as found within the amended petition alleges: 'over a period of more than seven (7) years, the defendants have been made aware of the damage caused by the emission into the atmosphere of corrosive industrial wastes from their stacks * * *.'

Further, the second cause of action sets forth: '* * * the defendants have been requested to correct the aforementioned conditions, but have not to this date done so; have been requested to protect the property rights of those citizens whose premises are situated with the surrounding...