2020 Ohio 1579
Ohio2020Background
- Lubrizol sold resin to IPEX from 2001–2008; IPEX used it in Kitec plumbing that later failed, producing suits and a settlement with IPEX that required Lubrizol to indemnify IPEX.
- Lubrizol sought coverage for defense and settlement costs from insurers who provided coverage during the years the resin was sold; National Union issued an umbrella policy for 2/28/2001–2/28/2002.
- Lubrizol sued National Union asking to recover all defense and indemnity costs under a single triggered policy (claiming an "all-sums" style recovery), while National Union argued liability must be allocated across multiple policy periods.
- The National Union policy language at issue required payment of "those sums" the insured becomes legally obligated to pay because of property damage "that takes place during the Policy Period."
- The federal district court certified the state-law question to the Ohio Supreme Court: whether an insured may seek full indemnity under a single policy covering "those sums" when the property damage occurred over multiple policy periods.
- The Ohio Supreme Court answered no for cases where the injury or damage occurred at a discernible time and thus should be charged to the insurer covering that time; it distinguished prior "all-sums" decisions that involved continuous, progressive injuries and left open that different facts or contract terms could lead to a different result.
Issues
| Issue | Lubrizol's Argument | National Union's Argument | Held |
|---|---|---|---|
| Whether an insured may recover full indemnity under a single policy that promises to pay "those sums" for property damage "during the Policy Period" when the damage occurred across multiple policy periods | Lubrizol: precedent (Goodyear/Park-Ohio) allows an insured to pick a single triggered policy to cover all sums up to its limit (analogous to "all sums" recovery) | National Union: the policy says "those sums," not "all sums," and the damage here is discrete and knowable yearly, so liability should be allocated pro rata to the policy covering the time of damage | Held: No — when damage occurs at a discernible time, liability is assigned to the insurer covering that period; Goodyear/Park-Ohio apply to continuous/progressive injuries and do not control here; factual/contractual differences could produce another outcome on remand |
Key Cases Cited
- Goodyear Tire & Rubber Co. v. Aetna Cas. & Sur. Co., 95 Ohio St.3d 512 (Ohio 2002) (adopted "all-sums" recovery for continuous environmental-pollution claims triggered under multiple policies)
- Pennsylvania Gen. Ins. Co. v. Park-Ohio Industries, 126 Ohio St.3d 98 (Ohio 2010) (reaffirmed Goodyear for progressive, continuous-injury cases)
- Keene Corp. v. Ins. Co. of N. Am., 667 F.2d 1034 (D.C. Cir. 1981) (articulated three-step analysis: trigger, extent, and allocation; relevant for long-tail disease/injury allocation)
- Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216 (Ohio 2003) (standard rules of contract interpretation: give effect to plain language and resolve ambiguities for the insured)