State Farm Fire & Cas. Ins. Co. v. Deni Associates of Florida, Inc.

• Decision Date: 17 July 1996
• Docket Number: 94-2580,O-S,Nos. 94-2354,s. 94-2354
• Citation: 678 So.2d 397
• Court: Florida District Court of Appeals
• Parties: 21 Fla. L. Weekly D1640 STATE FARM FIRE & CASUALTY INSURANCE CO., Appellant, v. DENI ASSOCIATES OF FLORIDA, INC., Appellee. FLORIDA FARM BUREAU MUTUAL INSURANCE COMPANY, Appellant, v. E.C. FOGG, III, Lisabeth A. Fogg, Elizabeth Fogg Lane, and John Roger Clark, individually and as partners d/b/a Land-un Groves, Appellees.

Page 397

678 So.2d 397

21 Fla. L. Weekly D1640

STATE FARM FIRE & CASUALTY INSURANCE CO., Appellant, v. DENI ASSOCIATES OF FLORIDA, INC., Appellee.

FLORIDA FARM BUREAU MUTUAL INSURANCE COMPANY, Appellant, v. E.C. FOGG, III, Lisabeth A. Fogg, Elizabeth Fogg Lane, and John Roger Clark, individually and as partners d/b/a Land-O-Sun Groves, Appellees.

Nos. 94-2354, 94-2580.

District Court of Appeal of Florida Fourth District.

July 17, 1996.

Appellee denied attorney fees on grant of rehearing Aug. 20, 1996.

Clarification Denied Oct. 9, 1996.

Elizabeth K. Russo and Kimberly L. Boldt of Russo & Talisman, P.A., Coconut Grove, and Green, Haverman & Ackerman, P.A., Fort Lauderdale, for appellant State Farm Fire & Casualty Ins. Co.

Scott A. Mager and Anthony K. Goodman of Mager & Associates, and Walter G. Campbell, Jr., of Krupnick, Campbell, Roselli, & Malone, Fort Lauderdale, for appellee Deni Associates of Florida, Inc.

Bonita L. Kneeland and Tracy A. Raffles of Fowler, White, Gillen, Boggs, Villareal, & Banker, P.A., Tampa, for appellant Florida Farm Bureau Mutual Ins. Co.

Beverly D. Eisenstadt and Cromwell A. Anderson of Fowler, White, Burnett, Hurley, Banick & Stickroot, P.A., Miami, for appellees Fogg, Fogg, Lane and Clark.

EN BANC

FARMER, Judge.

In these unrelated appeals, we have decided on our own motion to grant review en banc and resolve them together. We face the identical issue in each case--namely, whether a blanket exclusion of coverage for bodily injury caused by pollution in a comprehensive general liability policy is ambiguous. We conclude that it is not and consequently reverse for appropriate judgments in each of these cases.

In the State Farm appeal, the dispute centers around an accidental contamination of the interior atmosphere of an office building. Deni & Associates [the insured], an architectural firm, was moving its office equipment into new offices within the building when ammonia from a blueprint machine accidentally spilled. The fire department removed carpeting, broke a window to ventilate the interior atmosphere, and ordered the building evacuated until the air was safe to breathe. Nearly six hours later, the building was deemed safe for occupancy. When personal injury claims were made against the firm, Deni & Associates sought coverage from its liability carrier. State Farm ultimately denied coverage, and the trial court disagreed in a summary judgment with that denial.

In the Florida Farm Bureau case, defendants Foggs, Lane and Clark (the insured) own and operate a citrus grove in Palm Beach County. They hired an outside contractor to spray an insecticide (Ethion) on their grove from a helicopter. While spraying the grove, the contractor also sprayed two men who were standing on adjacent property. The men sued the insured for damages, claiming they had suffered bodily injuries from the insecticide. The insured in turn made a claim to their liability carrier, Florida Farm Bureau, for coverage and a defense. Florida Farm Bureau denied coverage, and thus the suit and appeal.

In both cases, the policy is a comprehensive general liability policy (CGL), a kind of policy widely purchased by businesses in the state of Florida. The CGL carriers based their denials of coverage on a policy exclusion that we shall label a "pollution exclusion," which is substantively identical in both policies. The clauses categorically exclude coverage for personal injuries caused by the "discharge, dispersal, release or escape of pollutants." In turn, they expressly define the term pollution as "any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste."

In the summary judgment in the State Farm case, the trial judge reasoned that "pollution clauses appear to contemplate long-term environmental degradation or, at the very least, an environment-wide exposure to extremely hazardous or toxic substances." He also noted that most of the lately published decisions involved pollution exclusion clauses containing an exception for claims arising from "sudden and accidental" discharges, citing Claussen v. Aetna Cas. & Sur. Co., 865 F.2d 1217 (11th Cir.1989). He found that State Farm's broad definition of pollution had "stretch[ed] the definition of 'pollutant' beyond what a reasonable person placed in the position of the insured would have understood the word to mean." [e.s.] Deeming the categorical exclusion in this case ambiguous, he applied the rule that ambiguities are resolved in favor of coverage.

In the Florida Farm Bureau summary judgment finding coverage, the trial judge also found the exclusion ambiguous. Relying on a trial court opinion from Kansas, he stated that the policy definition of pollution is unclear because "a broad reading of 'irritant or contaminant' as being any substance that might cause injury or bother would include virtually every substance in existence." ¹ He observed that "milk is an irritant to persons allergic to it" and reasoned that the broadness of the definition "would swallow the coverage of the policy." Citing the principle that exclusions from coverage are narrowly construed, he rejected the policy's own definition of the term pollution and construed the term to mean "a substance particularly harmful or toxic to persons or the environment generally, and not merely a substance harmful to persons or the environment due to special circumstances." He added that this construction was "consistent with the purpose behind the pollution exclusion, which is to exclude from coverage injuries resulting from pollution or contamination of the environment, be it land, water or the atmosphere." Finding the policy ambiguous, the trial judge construed the exclusion in favor of the insured and found coverage.

We first note that the pollution exclusion used in CGL policies in Florida was recently before the supreme court in Dimmitt Chevrolet Inc. v. Southeastern Fidelity Ins. Corp., 636 So.2d 700 (Fla.1994). The text of the clause addressed in that case was different from the ones we address today in that the Dimmitt clause allowed coverage when the "discharge, dispersal, release or escape [of pollutants] is sudden and accidental." [e.s.] 636 So.2d at 702. We stress that there is no such exception in the present exclusion. Nevertheless, we cannot avoid noting that the court did not find the clause ambiguous even with that exception. The question we confront is whether the clause becomes ambiguous when the exception is removed.

None of the words used in the policy texts we have quoted above are highly technical; all are simple words of ordinary use. The fact that the words together combine to completely eliminate an entire area of potential coverage does not render them unclear. We find but one message in these exclusions, and it is apparent: no personal injury claims resulting from the discharge, dispersal, release or escape of liquid irritants or chemicals are covered. Because we find the clause unambiguous, we are unable to agree with the trial courts' construction of this categorical exclusion of pollution coverage in the summary judgments.

An insurance policy is a contract between the insured and the carrier. We thus apply the principle, followed in Florida, known as the "objective" theory of contractual intent:

"The rule is probably best expressed by the late Justice Holmes in 'The Path of the Law,' 10 Harvard Law Review 457, where it was stated in part that 'The making of a contract depends not on the agreement of two minds in one intention, but on the agreement of two sets of external signs--not on the parties having meant the same thing but on their having said the same thing.' " [e.s.]

Gendzier v. Bielecki, 97 So.2d 604, 608 (Fla.1957). Hence, the meaning of a contract is deduced from the unambiguous language employed by the parties. Lyng v. Bugbee Dist. Co., 133 Fla. 419, 182 So. 801 (1938). It is thus foreign to our law to find the meaning of contractual language from the subjective understanding of one of the parties, as the trial judge did in the State Farm case.

In Rigel v. National Casualty Co., 76 So.2d 285 (Fla.1954), the court described the basic rules for construction of insurance policies thus:

"We acknowledge the rules that if the language is plain and unambiguous, there is no occasion for the Court to construe it, ... that if uncertainty is present, the instrument should be construed against the insurer, ... that the Court should not extend strictness in construction to the point of adding a meaning to language that is clear, ... and that the Court should construe the contract of insurance to give effect to the intent of the parties, ...." [c.o.; e.s.]

76 So.2d at 286; see also National Auto. Ins. Ass'n v. Brumit, 98 So.2d 330 (Fla.1957) (provisions of policy limiting or avoiding liability construed most liberally in favor of insured and strictly against insurer). More recently, in State Farm Mut. Auto. Ins. Co. v. Pridgen, 498 So.2d 1245 (Fla.1986), the court further explained:

"As the district court noted, exclusionary provisions which are ambiguous or otherwise susceptible to more than one meaning must be construed in favor of the insured, since it is the insurer who usually drafts the policy. See Excelsior Insurance Co. v. Pomona Park Bar & Package Store, 369 So.2d 938, 942 (Fla.1979). However, '[o]nly when a genuine inconsistency, uncertainty, or ambiguity in meaning remains after resort to the ordinary rules of construction is the rule apposite. It does not allow courts to rewrite contracts, add meaning that is not present, or otherwise reach results contrary to the intentions of the parties.' Id. (citations omitted)." [e.s.]

498 So.2d at 1248. Even more recently, in Prudential Prop. & Cas. Ins. Co. v. Swindal, 622 So.2d 467 (Fla.1993), the court summarized these principles as follows:

"Florida law has long followed the general rule that tort law principles do not control...