The opinion of the court was delivered by: Keenan, District Judge.
On June 21, 1991, this Court issued an Opinion and Order
denying the motions of plaintiff and defendants for summary
judgment. Following that decision, the Court granted
defendants permission to file a motion to reargue. On August
26, 1991, as that motion was being submitted, a trio of
decisions was handed down by the Supreme Court of Michigan.
Defendants requested, and the Court granted, leave to file an
amended motion to reargue. Before the Court is the motion of
defendants, Royal Group, Inc., Royal Insurance Group, Royal
Insurance Company of America, and Royal Indemnity Company
(collectively "Royal") for reargument of the Court's June 21,
1991 decision in light of the August 26, 1991 decisions of the
Supreme Court of Michigan.
The Court heard oral argument on this motion on November 18,
1991. Decision was reserved. For the reasons set forth below,
defendants' motion is granted. In light of the decisions of
the Michigan Supreme Court in The Upjohn Company, et al. v. New
Hampshire Insurance Company, et al., 438 Mich. 197,
476 N.W.2d 392 (1991), Protective National Insurance Company v. The City
of Woodhaven, et al., 438 Mich. 154, 476 N.W.2d 374 (1991), and
Polkow v. Citizens Insurance Company of America, 438 Mich. 174,
476 N.W.2d 382 (1991), defendants' motion for summary judgment
For purposes of this motion, familiarity with this Court's
Opinion of June 21, 1991 is assumed. A brief restatement of
the facts and issues of the case, however, would be helpful to
understanding the instant motion.
Plaintiff brought suit seeking an order declaring that
Royal, plaintiff's former insurance carrier, was required to
provide coverage for plaintiff's expenses and defense costs
incurred and to be incurred in the cleanup of a state-approved
toxic waste dump in Otisville, Michigan. Predecessors of the
plaintiff, a corporation engaged in brewing and distributing
beer, had employed a waste hauler to transport used bottle
wash to the site in the 1970's.
In September 1983, five years after it closed, the dump site
was placed by the Environmental Protection Agency ("EPA") on
the National Priorities List under the Comprehensive
Environmental Response, Compensation, and Liability Act
("CERCLA"). In 1985 and 1986, the EPA notified companies that
had used the dump and that could be held liable for cleanup
costs, entities called Potentially Responsible Parties
("PRPs"), that the EPA would either clean up the Otisville
site itself and seek reimbursement from the PRPs or permit the
PRPs to conduct an EPA-supervised cleanup themselves. Heileman
was identified as a PRP.
After its designation as a PRP, Heileman sought to have its
share of the cleanup costs covered by its insurance carriers.
Heileman and its predecessors had two types of insurance
coverage: general liability coverage and excess or umbrella
coverage. Plaintiff's comprehensive general liability ("CGL")
coverage from Royal provided up to $250,000 in coverage for
property damage or bodily injury. The policies contained a
pollution exclusion clause, which provided that the CGL would
"(f) to bodily injury or property damage arising
out of the discharge, dispersal, release or
escape of smoke, vapors, soot, fumes, acids,
alkalis, toxic chemicals, liquids or gasses,
waste materials or other irritants, contaminants
or pollutants into or upon land, the atmosphere
or any water course or body of water; but this
exclusion does not apply if such discharge,
dispersal, release or escape is sudden and
Recent judicial definitions of "sudden and accidental" are the
focus of this motion.
Plaintiff brought this action seeking a declaration that
defendants were required to reimburse plaintiff for costs
incurred in carrying out the EPA's mandate. Both plaintiff and
defendant moved for summary judgment. After concluding that
Michigan law applied to this dispute, the Court found that the
case involved disputed issues of fact that precluded summary
judgment. The Court denied both motions in their entirety on
June 21, 1991. June 21, 1991 Order at 10, 1991 WL 120366.
Defendants now seek reargument of their summary judgment
motion based on three recent decisions of the Supreme Court of
Michigan, announced on August 26, 1991, which discuss the
scope and applicability of pollution exclusion clauses
identical to the one at issue in this action. Defendants
contend that the three cases make it clear that, as a matter
of law, they have no obligations to plaintiff arising out ...