PENN NATIONAL INSURANCE COMPANY v. CRUM & FORSTER INSURANCE COMPANY, INC.
2:09-cv-04644
D.N.J.Sep 1, 2017Background
- Gus Bittner, Inc. (Bittner), a New Jersey waste hauler, deposited waste at three separate southern New Jersey landfills (Helen Kramer, Buzby, BEMS) during the 1950s–1996 and was later sued in related Superfund actions.
- Penn National issued primary CGL policies (1976–1986); North River issued excess/umbrella policies (1976–1985) that required exhaustion of Penn National’s primary limits before North River had duties.
- Penn National defended Bittner and paid settlements/indemnity: a large Helen Kramer settlement (1998) with Penn paying $2,550,320 and North River $349,680; later indemnity payments of $99,590 (Buzby, 2007) and $48,013 (BEMS, 2011).
- After Carter-Wallace (N.J. 1998) established allocation principles between primary and excess insurers in long-term environmental cases, Penn National sued North River (2009) seeking contribution/reimbursement under Carter-Wallace for amounts Penn paid exceeding its policy limits.
- The parties filed cross-motions for summary judgment; the court initially declined to decide due to inconsistent positions by Penn National but, after supplemental argument, adjudicated the merits.
Issues
| Issue | Plaintiff's Argument (Penn National) | Defendant's Argument (North River) | Held |
|---|---|---|---|
| Whether Bittner’s hauling to the three landfills constitutes one "occurrence" or separate occurrences | The three sites should be treated as a single occurrence, making Carter-Wallace apportionment and Penn’s contribution claim not ripe until all sites resolved | Sites are spatially and temporally distinct — each landfill is a separate occurrence | Separate occurrences; each landfill was a distinct occurrence under NJ law |
| Accrual date / statute of limitations under N.J.S.A. 2A:14-1 for Penn’s contribution claim | Claims did not accrue until later settlements (e.g., BEMS in 2011) if treated as one occurrence | Accrual occurred upon settlement of each separate occurrence (Helen Kramer settled 1998) | Penn’s claim as to Helen Kramer accrued in 1998 and is time-barred; earlier accrual defeats later contribution claims dependent on reallocating Helen Kramer funds |
| Whether Penn exhausted primary limits such that North River owed defense/indemnity for Buzby and BEMS payments | Penn claims Carter-Wallace allocation establishes exhaustion and entitlement to contribution for amounts paid for Buzby and BEMS | North River contends Penn never exhausted per-occurrence primary limits absent reallocating the time-barred Helen Kramer settlement; thus North River has no liability | Penn cannot prove primary exhaustion because it relies on reallocating the time-barred Helen Kramer settlement; North River owed no liability under its excess policies |
| Relief requested (Penn’s reimbursement; North River’s dismissal) | Penn seeks reimbursement (~$1.6M per later calculations) under Carter-Wallace | North River seeks dismissal with prejudice based on timeliness and non-exhaustion | Court denied Penn’s motion and granted North River’s motion; claims dismissed with prejudice |
Key Cases Cited
- Carter-Wallace, Inc. v. Admiral Ins. Co., 154 N.J. 312 (1998) (establishes allocation method between primary and excess insurers in long-term environmental cases)
- Doria v. Ins. Co. of N. Am., 210 N.J. Super. 67 (App. Div. 1986) (defines "occurrence" by cause and the temporal/spatial connection of events)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (summary judgment standards)
- Willis v. UPMC Children's Hosp. of Pittsburgh, 808 F.3d 638 (3d Cir. 2015) (party moving for summary judgment bears burden to show no genuine issue of material fact)