405 F. App'x 270
10th Cir.2010Background
- Mendoza was injured by a mist of anhydrous ammonia fertilizer on Irsik Farms’ Kansas land in July 2006.
- Union insured Irsik Farms with a Farm owners-Ranch owners policy that includes a pollution exclusion in the Personal Liability endorsement.
- Mendoza obtained a consent judgment against Irsik Farms; Union sought a declaratory judgment and Irsik Farms was dismissed from that action.
- On the injury date, an Irsik employee released ammonia into the air while adjusting equipment; Mendoza suffered respiratory and other injuries nearby.
- The district court granted summary judgment for Union, ruling the pollution exclusion applied and the ammonia was a pollutant; Mendoza appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is anhydrous ammonia a pollutant under the exclusion? | Mendoza contends ammonia used as fertilizer is not a pollutant. | Union contends ammonia is an irritant/contaminant that falls within the exclusion. | Pollution exclusion not ambiguous; ammonia qualifies as a pollutant. |
| Is the pollutant definition ambiguous under Kansas law? | Definition is overly broad and ambiguous; favors insured. | Definition is clear and not subject to conflicting interpretations under controlling Kansas precedent. | Definition is not ambiguous; must be enforced as written. |
| Who bears the burden to prove exclusion applies? | Mendoza argues the insurer fails to prove the exclusion excludes coverage. | Union bears burden to show the exclusion applies and has done so. | Insurer bears the burden; Union sustained its burden to show exclusion applies. |
| Do Kansas precedents govern interpretation of the exclusion here? | Precedents might support a narrower reading in favor of coverage. | Governing Kansas precedents (Atlantic Avenue, Crescent Oil, Gerdes) support enforcing the clause as not ambiguous. | Governing Kansas authorities require enforcing the definition as written. |
Key Cases Cited
- Am. Family Mut. Ins. Co. v. Wilkens, 179 P.3d 1104 (Kan. 2008) (ambiguous policy terms assessed by how a reasonable insured would understand)
- Crescent Oil Co. v. Federated Mut. Ins. Co., 888 P.2d 869 (Kan. Ct. App. 1995) (pollution exclusion not inherently ambiguous)
- Atlantic Ave. Assocs. v. Cent. Solutions, Inc., 24 P.3d 188 (Kan. Ct. App. 2001) (not ambiguous where exclusion language clear)
- Regent Ins. Co. v. Holmes, 835 F. Supp. 579 (D. Kan. 1993) (interpretation of pollutants definition in exclusion clauses varies by jurisdiction)
- Gerdes v. American Family Mutual Ins. Co., 713 F. Supp. 2d 1290 (D. Kan. 2010) (district court aligned with Crescent Oil/Atlantic Avenue on not ambiguous pollutant definition)