Mountain States Mutual Casualty Co. v. Roinestad
2013 CO 14
| Colo. | 2013Background
- Respondents were injured by hydrogen sulfide gas while cleaning a sewer clog near Hog's Breath; district court found Hog's Breath liable for dumping grease under negligence theories.
- Hog's Breath carried Mountain States' commercial general liability policy, which includes a broad pollution exclusion for pollutants discharged from insured premises.
- The district court held the pollution exclusion unambiguous and barred coverage; the court of appeals reversed, finding ambiguity and potential absurd results.
- The Colorado Supreme Court granted certiorari to determine whether the pollution exclusion bars coverage for cooking grease discharged in large quantities.
- Factual record showed five- to eight-foot grease clog and toxic gas buildup, with evidence that Hog's Breath directed dumping grease into the sewer.
- The court ultimately held that the pollution exclusion applies, barring coverage for respondents' injuries.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the pollution exclusion apply to cooking grease discharges? | Roinestad argues grease is not a pollutant under the policy. | Mountain States contends grease qualifies as a pollutant when discharged in large quantities creating a clog. | Yes; grease discharges in quantity constituting a clog fall within the pollution exclusion. |
| Does the reasonable expectations doctrine override the exclusion here? | Roinestad asserts insured would expect exclusion not to apply to cooking grease evidence in CERCLA-like context. | Mountain States argues exclusions are clear and not limited to traditional pollution; no deception or expectation to defeat coverage. | No; the doctrine does not override the clear, broad pollution exclusion. |
| Is cooking grease a pollutant under the policy's terms? | Roinestad contends grease is common waste not a pollutant. | Mountain States argues pollutant includes waste and irritants, and quantity matters in context of a sewer clog. | Yes; grease becomes a pollutant when discharged in sufficient quantity to cause a sewer obstruction. |
| Do city ordinances defining pollutants influence the interpretation of the policy? | Roinestad relies on local ordinance definitions to argue coverage should be preserved. | Mountain States contends policy terms control; ordinances are not determinative of contract interpretation. | The ordinances support the finding that the discharge was a pollutant, reinforcing exclusion. |
Key Cases Cited
- Bailey v. Lincoln Gen. Ins. Co., 255 P.3d 1039 (Colo. 2011) (reasonable expectations doctrine discussed in pollution-exclusion context)
- TerraMatrix, Inc. v. U.S. Fire Ins. Co., 939 P.2d 483 (Colo.App. 1997) (pollution exclusions construed broadly in Colorado)
- National Casualty Co. v. Great Southwest Fire Ins. Co., 833 P.2d 741 (Colo. 1992) (interpretation of insurance contracts and policy terms)
- Compass Ins. Co. v. City of Littleton, 984 P.2d 606 (Colo. 1999) (insurance contract interpretation standards)
- Evanston Ins. Co. v. Harbor Walk Dev., LLC, 814 F.Supp.2d 635 (E.D. Va. 2011) (definition and interpretation of contaminants in pollution exclusions)