It may be difficult for a property owner to recoup cleanup costs after a renter has died on site. Here, AAA Crime Scene Steam and Clean worker Carol Oguri and owner Kathie Jo Kadziauskas work on a Los Angeles condominium where a man died of natural causes but was not found for a week.
Question: Last year, one of our clients’ tenants was found dead in their apartment. The body was there about 2 weeks. A claim was reported to the insurance company, and the insured contracted a forensic cleanup company to handle the apartment. The carrier has since denied the claim, citing the pollution exclusion. I was hoping that you had some information or documentation that I can use to dispute the carrier’s position that the bodily fluids are not considered a pollutant.
Answer: Couch on Ins. § 127:8 says it best: “Several courts have applied the principle of ‘ejusdem generis,’ interpreting pollution by reference to the surrounding language in order to limit the list of substances that may otherwise qualify as pollutants. Thus, although the list of substances provided in the definition may be nonexhaustive, substances not specifically mentioned must be similar in nature to the listed substances. For example, it has been held that living, organic irritants or contaminants do not constitute pollutants under the policy definition because the irritants specifically identified in the definition, namely, “smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste,” are primarily inorganic in nature.
The homeowners form HO 00 03 05 11 does not define pollutants in the definitions. Pollutants are defined in the exclusions section as “solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste. Waste includes materials to be recycled, reconditioned or reclaimed…”
The intent of the exclusion is to eliminate coverage from industrial products and byproducts. A human body cannot be recycled or reconditioned or reclaimed. That implies being able to reuse the materials again for the same or similar purposes. Organ donation is not recycling a human body. Nicholson v. Allstate Ins. Co. (979 F. Supp. 2d 1054, E.D. Cal. 2013) speaks to this directly. In this case, the court stated that the carrier failed to show that the standard pollution exclusion in the homeowners policy would be understood by a reasonable policyholder to apply to bat guano and decaying bat carcasses.
Exclusions are to be read narrowly, and reading the pollution exclusion narrowly puts the list of excluded items as being industrial or environmental in nature, and not the result of a natural tenant death.
Dealing with decomposition
Question: There was a deceased body in an apartment building. Tenant had complained about the smell and alleged damages as a result of the odor. Our insured did not know there was a dead body in the building. Can the fumes/gases released by a dead body be considered a pollutant?
— Washington, D.C. Subscriber
Answer: Dead body gases should not be considered a pollutant since the current trend by courts is to view pollutants and the pollution exclusion in connection with environmental issues. However, before any consideration of exclusions should be considered, where is the liability on the part of the insured? Where is the bodily injury and/or property damage to a third party? The insuring agreement has to be considered first before any exclusions are considered, and these circumstances you describe do not seem to match any part of the insuring agreement.
Twice the grieving for a common law widow
Question: This is on a general liability policy. The insured is a funeral home. The claimant and the deceased were common law married. The claimant came home and found her domestic partner dead. Without the claimant’s permission, the insured picked up the body and transferred the body to one of its facilities.
The claimant contacted the insured, who confirmed they had permission to take the corpse.
The claimant asked if she could view the body and was told that she would have to obtain permission to view the body from the deceased’s mother, and that she would have to pay $300 to view the body. The claimant told the insured that she is the legal spouse and should be allowed to view the body. The insured refused to allow the claimant to view the body without the permission from the family or without paying a fee.
Then, without the claimant’s permission or knowledge, the insured cremated the body. The claimant was opposed to cremation and believes that her partner would not have wanted to be cremated. The insured then released the ashes to his estranged mother, who took the remains with her to another state. This was done without the consent or knowledge of the claimant.
The claimant has filed a lawsuit and is seeking compensation for emotional distress plus punitive damages.
Would this be considered an occurrence under the CGL form?
— California Subscriber
Answer: This sounds like a questionable case of liability on the part of the insured. We do not know the law in this area, but it seems that the parents have the legal right to dispose of the son’s remains and the insured was just following the proper instructions. But you would have to check with an attorney on this to see what the law in that area is when it comes to the status of common law couples.
In any case, if the insured is liable, emotional distress is not covered by the CGL form. There has to be bodily injury or property damage. As for an occurrence, that has to be considered from the standpoint of the insured. So, if the insured made a mistake and followed the wrong instructions, that is an accident and therefore an occurrence.
Covering an accidental carbon monoxide poisoning
Question: Our insured had some friends in his garage for a get-together. Because it was winter, they had a space heater going. The end result was that our insured and one of his friends are dead. The family of the deceased friend is suing our insured’s wife, and she herself is making a derivative claim for bodily injury. Our homeowners policy appears to exclude any coverage whatsoever. There is a Section I and II exclusion, which precludes coverage for “bodily injury, personal injury, mental anguish or property damage … involving the presence, discharge, dispersal… of toxic chemicals, liquids or gases… or any substance which [is] or may be injurious to public health or the environment (herein called ‘hazardous substances’) into or upon land, the atmosphere or any water course or body of water…”
— Illinois Subscriber
Answer: We reviewed three cases that addressed this problem. They involved commercial liability; however, the wording of the exclusion under review was comparable to that in your homeowners form.
In the first, Essex Insurance Co. v. Tri-Town Corp. (863 F.Supp. 38, D. Mass. 1994), the court upheld the exclusion when a malfunctioning Zamboni machine emitted carbon monoxide into an ice rink. But a court in Pennsylvania reached a different conclusion with reference to the same exclusion. A hot water heater malfunctioned, allowing carbon monoxide to infiltrate a restaurant, resulting in bodily injury. The court looked at Tri-Town, and noted that the word “atmosphere” had not been discussed. The court said that “the exclusion is worded broadly to encompass the natural resources of this planet in their natural setting… within the context of the pollution exclusion, the distinction is not in the air itself but where the air happens to be… We conclude, therefore, that the term ‘atmosphere’ in the pollution exclusion does not exclude coverage under the primary policies for the contamination or pollution of air within a building.” (This case is Gamble Farm Inn Inc. v. Selective Insurance Co. (656 A.2d 142, Pa. Super. 1995).
That brings us to American States Insurance Co. v. Koloms (687 N.E.2d 72 , Ill. 1997). Here, tenants in a building owned by the Koloms were sickened by carbon monoxide fumes from a furnace. The Illinois Supreme Court considered Gamble Farm Inn, noting that the court said the exclusion was ambiguous, and considered other cases that denied coverage on the grounds that the exclusion was plain and unambiguous. The court said “we agree with those courts which have restricted the exclusion’s otherwise potentially limitless application to only those hazards traditionally associated with environmental pollution. We find support for our decision in the drafting history of the exclusion, which reveals an intent on the part of the insurance industry to so limit the clause.”
And this approach appears to be the fairest to your insured. There would be no coverage for negligently discharging oil or gas into a storm drain or water supply, say, but there is coverage when, as in this case, a space heater malfunctions.
We also noted in the policy the statement that “the exclusion does not apply to liability resulting from the use of product [sic] used in the cleaning or maintenance of the household or residence premises.” The space heater can be viewed as a product used in the maintenance of the residence premises in that it is used to maintain heat.
So, given the courts’ findings and this exception, we think the claim against the insured for bodily injury is covered. We do not think the insured’s wife has a claim against the policy, because most homeowners forms exclude coverage for bodily injury to an insured. You will want to review the policy’s exclusions.