Posted by Sharon on 3/18/05

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This is an FYI. For those of you who are writing
remediation scopes, asbestos in the building sometimes
becomes an issue. Who is responsible for it's removal once
it has become disturbed? Maybe this will help clarify
things and make your jobs a bit easier. According to the
California courts, if the asbestos is disturbed during
remediation, then it is part of the covered loss.
Exclusion Doesn’t Apply To Asbestos Abatement As Damage
Rather Than Cause
SAN DIEGO — Because asbestos abatement costs were
not “caused directly or indirectly by . . . pollution,” but
by a fire, a covered peril, the pollution exclusion does
not bar coverage, a California appeals court ruled Dec. 30
(Abigay Gonzales, et al. v. Western Mutual Insurance Co.,
No. D044000, Calif. App., 4th Dist.; 2004 Cal. App. Unpub.
LEXIS 11903 Shepardize).

(Opinion available. Document #03-050111-103Z.)

The Fourth District Court of Appeal reversed a ruling
barring coverage to homeowners seeking coverage for the
cost to remove asbestos from their home, which existed in
the ceilings and had become friable and exposed after a
fire. The San Diego County Superior Court erred in
granting summary judgment to Western Mutual Insurance Co.,
it held.

Cause Versus Damage

According to the language of Abigay Gonzales and Maria
Castelo’s all-risk property policy, the exclusion refers to
excluded causesof damage rather than excluded items of
damage, the appeals court concluded.

Western accepted coverage for the fire loss but refused to
pay for the removal of asbestos based on the pollution
exclusion.

Even though asbestos is included in the definition of
pollution, in this case, the asbestos — or the cost to
remove it — was the claimed loss, not the cause of the
loss. Generally, the question of whether a peril was the
efficient proximate cause is a factual issue, but in this
case, the insurer admitted that the asbestos removal costs
were an item of damage and not caused by pollution.

Thus, the appeals court held that the pollution exclusion
in this policy applies only to damages caused by pollution,
and in this case, pollution did not cause the claimed
damage.

“Viewing the policy as a whole, an insured would have
reasonably understood that the pollution exclusion
contained in the ‘Section 1 — Exclusions’ portion of the
policy would not exclude damages caused by a fire, and
instead would exclude only those damages caused by
pollution as that term is defined in the policy,” the court
held in an unpublished opinion.

William J. Brown of Encinitas, Calif., represents the
homeowners. Randall L. Winet of Winet, Patrick & Weaver in
Vista, Calif., is counsel for Western

This is based on California Insurance Code 531. 531 is one
of the original laws in the state of California, taken from
the state of New York. Has a fascinating history. Started
out with the shipping industry in the 1800's, as many
insurance laws did.

531. An insurer is liable:
(a) Where the thing insured is rescued from a peril
insured
against, and which would otherwise have caused a loss, if,
in the
course of such rescue, the thing is exposed to a peril not
insured
against, and which permanently deprives the insured of its
possession, in whole or in part.
(b) If a loss is caused by efforts to rescue the thing
insured
from a peril insured against.

Sharon Kramer

Asbestos Claims Chatboard

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