A judge in the United States District Court Eastern District of Pennsylvania ruled that an insurance company does not have to indemnify a landlord whose tenants sued over carbon monoxide poisoning,
In Foremost v. Nosam, Foremost sought declaratory judgment stating that it did not owe a duty to defend or indemnify, Nosam LLC in the state court action based on a pollution exemption in its policy.
This case arose from the state court action in which plaintiff and her two children sued their Landlord and the building owner (Nosam LLC) after suffering carbon monoxide poisoning, allegedly from a faulty furnace in Sylvestre’s apartment.
The malfunction in the furnace was allegedly caused by a neighboring chimney collapsing and falling into the plaintiff’s chimney. This allegedly caused a blockage in the heating unit at the plaintiff’s residence, causing the emission of carbon monoxide.
Foremost disclaimed citing the policy which read “We will not pay for bodily injury or property damage…[arising out of the actual, alleged or threatened discharge, dispersal, release, escape of, or the ingestion, inhalation of absorption of pollutants.” The underlying plaintiffs later claimed that the emission was caused by an accidental fire when the heating system was converted to a gas system, which would trigger the exclusion to the policy exemption.
The Court ruled, “ Although the underlying plaintiffs contend that they did not know the heating system had been converted to gas, there is no suggestion they did not knowingly and intentionally start the December 9, 2015, fire by turning on the furnace…There is no suggestion that any flames, or any part of, this controlled fire extended outside the sealed unit where it was designed to burn…Further, although the chimney collapse may have contributed to the buildup of carbon monoxide inside the residence, the unexpected collapse did not cause the fire. The fire, regardless of whether it was ignited by gas or oil, did not happen by chance or unexpectedly and was therefore not accidental. Although the buildup of carbon monoxide was accidental, it was not released by an accidental fire and the underlying plaintiff’s attempt to conflate the two requires a strained interpretation of that term.”
The salient distinction the Court makes is based on the carbon monoxide emission (obviously) being accidental, whereas the fire was started intentionally. Because the fire was started intentionally, Formost’s policy exclusion applied, and Foremost owed no duty to defend or indemnify. Thanks to Jon Avolio for his contribution to this post. Please email Brian Gibbons with any questions.