Occurrence Again but not Construction--June, 2012

We have had lots of discussions about the magical word "occurrence" and how it has been used to deny losses all over the country. Most cases have involved property damage/completed operations but not all and it seems like carriers are using their court success to push the issue. 

A recent case in VA seems to back this up. Pollution and Climate Change Issues are growing. AES Corp. in Arlington, VA, has been sued regarding climate change liability. Most of us would agree that such a claim is way beyond the realm of coverage under a CGL. The Supreme Court of the state of VA agreed with that and said that the GL carrier (Steadfast Insurance) had no obligation to defend or indemnify AES. 

Background--The case involved native Alaskans suing various parties including AES claiming that their activities damaged the village(s) by causing global warming (there are several cases pending in this area). AES looked to Steadfast for defense and coverage and Steadfast said no. It does seem to be a BIG stretch to find coverage but here is what is interesting---Steadfast denied saying that it was not an "occurrence" and therefore the policy never triggered. The VA Supreme Court agreed with that. 

The court agreed that it was not an "occurrence" and therefore the   policy never triggered. While it does seem that CGL polices should not cover these types of losses the court seems to be saying that AES 'knew' that damage would take place. That seems to be quite a stretch. As with too many of these cases the court seems to be equating "accidental" with "intentional" and there is a big difference between those two.

It just seems like the word "occurrence" is being used as a quick and convenient "go to" to deny everything. Not only are carriers doing this but they are going to court and winning. Accidents are not intentional acts. 

If you want to read some more here is a re-cap from a Climate Change BLOG and you might find this BLOG of value in the future.

Climate Lawyers--