Sylvester Bros. Development Co. v. Great Cent. Ins. Co.

• Decision Date: 20 July 1993
• Docket Number: No. CX-92-2490,CX-92-2490
• Citation: 503 N.W.2d 793
• Court: Minnesota Court of Appeals
• Parties: SYLVESTER BROTHERS DEVELOPMENT COMPANY, d/b/a East Bethel Landfill, Appellant, v. GREAT CENTRAL INSURANCE COMPANY, et al., Defendants, The Federated Mutual Insurance Company, Respondent, Commercial Union Insurance Company, et al., Respondents, Auto-Owners Insurance Company, Respondent, Interstate Fire & Casualty Company, Respondent.

Page 793

503 N.W.2d 793

SYLVESTER BROTHERS DEVELOPMENT COMPANY, d/b/a East Bethel

Landfill, Appellant, v. GREAT CENTRAL INSURANCE COMPANY, et al., Defendants, The Federated Mutual Insurance Company, Respondent, Commercial Union Insurance Company, et al., Respondents, Auto-Owners Insurance Company, Respondent,

Interstate Fire & Casualty Company, Respondent.

No. CX-92-2490.

Court of Appeals of Minnesota.

July 20, 1993.

Review Denied Sept. 30, 1993.

Syllabus by the Court

Issues not determined in an earlier appeal may be litigated on remand. Seepage of contaminants from a landfill to groundwater continuing for over two decades is not sudden.

Forrest D. Nowlin, Gary Hansen, Timothy J. Dolan, Doherty, Rumble & Butler, Minneapolis, for Sylvester Bros. Development Co. d/b/a East Bethel Landfill.

James A. Jardine, John O'Brien, Jardine, Logan & O'Brien, St. Paul, for The Federated Mut. Ins. Co.

John M. Anderson, Charles E. Lundberg, Bassford, Heckt, Lockhart, Truesdell & Briggs, P.A., Minneapolis, for Commercial Union Insurance Co., et al.

James A. Reding, Sylvia Ivey Zinn, Reding & Votel, St. Paul, for Auto-Owners Ins. Co.

Dale O. Thornsjo, Peterson & Hektner, Ltd., Minneapolis, for Interstate Fire & Cas. Co.

Michael Berens, Kelly & Berens, P.A., Minneapolis, for amicus curiae Ins. Environmental Litigation Ass'n.

Considered and decided by SHORT, P.J., SCHUMACHER and KLAPHAKE, JJ.

OPINION

SHORT, Judge.

This declaratory judgment action involving the question of insurance coverage for groundwater contamination caused by the leaching of pollutants from a landfill is before us for the second time. Initially, the trial court granted summary judgment for the insurers because it concluded contamination by the routine deposit of waste into a landfill was not "sudden and accidental." We reversed, remanded, and ruled the proper inquiry must be whether the escape of pollutants from the landfill into the surrounding groundwater, rather than their routine deposit, was "sudden and accidental." Sylvester Bros. Dev. Co. v. Great Cent. Ins. Co., 480 N.W.2d 368, 374 (Minn.App.1992), pet. for rev. denied (Minn. Mar. 26, 1992) (Sylvester I ). On remand, the trial court determined the release of contaminants constituted seepage which was not sudden, and granted summary judgment for the insurers. On appeal, Sylvester Brothers Development Company (operator) argues: (1) our holding in Sylvester I precludes the trial court from granting summary judgment; and (2) a jury should decide the question of whether the escape of contaminants was sudden and accidental. We affirm.

FACTS

The facts are set out in Sylvester I and are only briefly restated here. In 1969, the operator established an open dump at the East Bethel landfill site in Anoka County. At that time, the operator believed the soil underlying a dump or landfill would act as a filter to prevent pollutants from migrating into and contaminating the groundwater. The landfill, as an open dump, received film and photo processing chemicals, oil filters containing waste oil, asphalt and solvents, paint, ink, liquid ether, foundry slag, asphalt tar, roofing materials, waste ash, kerosene, oil-soaked rags, cleaning solvents and dry cleaning solvents.

In 1970 and 1971, because of the potential for causing groundwater problems, both the Minnesota Pollution Control Agency (MPCA) and Anoka County adopted regulations prohibiting the acceptance of toxic and hazardous waste by landfills. Following promulgation of these regulations, the operator ran the East Bethel site as one of the state's first sanitary landfills. In 1974, East Bethel became a "modified sanitary" landfill, accepting only demolition fill, certain waste generated by companies involved in the construction industry and municipal solid waste brought by individuals living in the area. The landfill continues to operate as a modified sanitary/demolition landfill today.

In 1980, Anoka County hired an engineering firm to evaluate data collected from the testing of groundwater at four of the county's landfill sites. By 1984, that firm had concluded there was extensive groundwater contamination at East Bethel. The MPCA notified the operator it was considered a potentially responsible party for studying and remediating the groundwater contamination. In 1985, the operator and the MPCA entered into a consent decree which made the operator responsible for all costs involved in the investigation and cleanup of groundwater contamination at East Bethel. The operator seeks to recover all of these costs from its insurers.

The trial court granted the first summary judgment motion for the insurers on the basis that groundwater contamination by the operator's routine deposit of waste into the landfill was not sudden and accidental. We reversed on that issue, explaining that the language of the policies' pollution exclusion requires the focus to be on the escape of the pollutants from the landfill into the surrounding groundwater, rather than on the deposit of waste into the landfill. Sylvester I, 480 N.W.2d at 374. On remand, the trial court determined that although there were numerous releases from the landfill which were themselves sudden and accidental, these releases as a whole constituted seepage into the groundwater which was not sudden.

ISSUES

I. Does the doctrine of law of the case bar summary judgment?

II. Are there material facts in dispute which prevent summary judgment?

ANALYSIS

On appeal from a grant of summary judgment, we determine whether there are any genuine issues of material fact and whether the trial court erred in its application of the law. Offerdahl v. University of Minn. Hosps. & Clinics, 426 N.W.2d 425, 427 (Minn.1988). We do not defer to the trial court's application of the law. See Frost-Benco Elec. Ass'n v. Minnesota Pub. Utils. Comm'n, 358 N.W.2d 639, 642 (Minn.1984) (appellate court need not give deference to a trial court's determination of a legal issue). We view the evidence in the light most favorable to the operator. Abdallah, Inc. v. Martin, 242 Minn. 416, 424, 65 N.W.2d 641, 646 (1954). The interpretation and construction of an insurance policy is a matter of law which the trial court properly can determine on summary judgment, and which we review de novo. Iowa Kemper Ins. Co. v. Stone, 269 N.W.2d 885, 887 (Minn.1978).

I.

The doctrine of "law of the case" is based on a policy requiring issues once fully litigated to be set at rest. Lange v. Nelson-Ryan Flight Serv., Inc., 263 Minn. 152, 156, 116 N.W.2d 266, 269 (1962), cert. denied, 371 U.S. 953, 83 S.Ct. 508, 9 L.Ed.2d 500 (1963). It applies when an appellate court has ruled on a legal issue and remanded the case for further proceedings on other matters. The issue decided becomes the "law of the case" and may not be relitigated in the trial court or re-examined in a second appeal. Sigurdson v. Isanti County, 448 N.W.2d 62, 66 (Minn.1989); Mattson v. Underwriters at Lloyds of London, 414 N.W.2d 717, 719-20 (Minn.1987); Nees v. Minneapolis St. Ry., 221 Minn. 396, 397, 22 N.W.2d 164, 164 (1946). However, issues not determined in the first appeal may, on remand, be litigated. Mattson, 414 N.W.2d at 720; see also Sigurdson, 448 N.W.2d at 66 (doctrine of law of the case does not reach issues which were not litigated); Cayse v. Foley Bros., Inc., 260 Minn. 248, 253, 110 N.W.2d 201, 205 (1961) (questions not decided may be considered on a second appeal).

The operator is correct that the issues decided in Sylvester Bros. Dev. Co. v. Great Cent. Ins. Co., 480 N.W.2d 368 (Minn.App.1992), pet. for rev. denied (Minn. Mar. 26, 1992) (Sylvester I ) may not be relitigated in the trial court or re-examined in a second appeal. Sylvester I 's conclusion that the triggering event was the release of contaminants from the East Bethel landfill into the groundwater constitutes the law of the case. However, the operator further argues our opinion in Sylvester I bars a grant of summary judgment. We disagree. Neither the trial court nor this court had before it the issue of whether the discharge of contaminants from a landfill was sudden and accidental. The trial court on remand, based on evidence from the operator, found multiple discharges represented an ongoing pattern of contamination that did not as a matter of law fall within the exception to the policies' pollution exclusion clause. Because this precise issue was not before the trial court on the insurers' first motion for summary judgment, Sylvester I does not prevent the trial court on remand from granting summary judgment based on this ground. See, e.g., Cayse, 260 Minn. at 256, 110 N.W.2d at 206 (decision on first appeal that party was not entitled to judgment notwithstanding the verdict did not preclude appellate court from ordering such a judgment for the party on second appeal where different theory of recovery is pursued at second trial). Assuming no material facts are in dispute, the trial court could grant summary judgment in the insurers' favor.

II.

Summary judgment is appropriate when there are no issues of material fact and where determination of the applicable law will resolve the controversy. Minn.R.Civ.P. 56.03; North Cent. Pub. Serv. Co. v. Village of Circle Pines, 302 Minn. 53, 56-57, 224 N.W.2d 741, 744 (1974). For purposes of Rule 56, a "material fact" is one of such a nature as will affect the result or outcome of the case depending upon its resolution. Rathbun v. W.T. Grant Co., 300 Minn. 223, 229, 219 N.W.2d 641, 646 (1974). Facts, inferences, and conclusions that reasonably may be drawn by a jury from the evidence are fact issues which may not be resolved by the trial court on a motion for summary judgment. Illinois Farmers Ins. Co. v. Tapemark Co., 273 N.W.2d 630, 633 (Minn.1978); Rathbun, 300 Minn. at 230, 219 N.W.2d at 646; Hamilton v. Independent Sch. Dist. No. 114, 355 N.W.2d 182, 184 (Minn.App.1984). On review, we must take a view of the evidence most favorable to the party...