Ansul, Inc. v. Employers Insurance
826 N.W.2d 110
Wis. Ct. App.2012Background
- Ansul, Inc. and Tyco were insured by nine Lloyd's excess policies with varying attachment points from 1969–1980.
- Ansul contaminated groundwater near the Menominee River with arsenic from the 1950s through 1977, prompting state and federal cleanup orders and multi-million remediation costs.
- DNR and EPA involvement spanned the 1970s–1990s, with groundwater treatment and later soil/silt remediation and long-term monitoring.
- Ansul did not notify Lloyd's of contamination or government remediation until 1997, instead suing Lloyd's in New Hampshire; later Wisconsin actions were dismissed for lack of timely notice and failure to cooperate.
- Wisconsin circuit court held Ansul breached notice and cooperation provisions, and dismissed coverage; the court of appeals affirmed via de novo review.
- This appeal addresses whether late notice and cooperation breaches preclude coverage under nine excess policies.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Timeliness of notice under policies | Ansul argues genuine disputes exist for some policies (UKL1311). | Lloyd's contends notice was untimely for all policies; delay prejudiced defense. | Notice untimely; prejudice established; coverage precluded. |
| Effect of Assistance and Cooperation breaches on coverage | Cooperation breaches were not prejudicial; insurer still could defend. | Breach prejudiced Lloyd's by denying opportunity to participate in defense. | Breach prejudiced insurer; summary judgment proper. |
| Prejudice standard after late notice | Prejudice should be analyzed with factual disputes; some evidence suggests no prejudice. | By extensive delay and adversarial litigation, prejudice is inevitable. | Prejudice exists as a matter of law; no genuine issue to rebut. |
| Allocation and other defenses | Not addressed because covered by notice/cooperation issues. | Possible pollution exclusions and known-loss doctrine might bar coverage. | Not reached; preclusion based on untimely notice and cooperation supersedes. |
| Follow-form policies and impact of missing cooperation clause | Some policies lack explicit cooperation text, but follow-form policies adopt underlying terms. | Cooperation clauses present in underlying forms apply to excess policies. | Citations confirm cooperation terms apply; issues resolved on notice/ prejudice grounds. |
Key Cases Cited
- Gerrard Realty Corp. v. American States Ins. Co., 89 Wis. 2d 130 (1979) (notice requirements; investigation rights; prejudice framework)
- Neff v. Pierzina, 245 Wis. 2d 285 (Wis. 2001) (timing of notice and prejudice; reasonable time standard)
- Fireman's Fund Ins. Co. of Wis. v. Bradley Corp., 261 Wis. 2d 4 (Wis. 2003) (notice prejudice analysis; late notice may be prejudicial)
- Rockline, Inc. v. Wisconsin Physicians Serv. Ins., 175 Wis. 2d 583 (Ct. App. 1993) (insurance policy interpretation; contract interpretation rules)
- Folkman v. Quamme, 264 Wis. 2d 617 (Wis. 2003) (ambiguous clauses construed in insured's favor)
- Gerrard Realty Corp. v. American States Ins. Co. (duplicate entry for emphasis), 89 Wis. 2d 130 (1979) (see above)