Interpreting Insurance Policies

Anyone in Grand Prairie, Arlington, Mansfield, Cedar Hill, Duncanville, De Soto, Lancaster, Hurst, Euless, Bedford, Dallas, Fort Worth, or anywhere else in Texas who reads an insurance policy is going to get through with the reading and with their blurred eyes, wonder what they just read. Here is a case where the interpretation of a policy exclusion was at issue.
The case is styled, RLI Insurance Company v. Sylvia Gonzalez; Alma Alicia Gonzalez, Individually and as Representative of the Estate of Hector Gonzalez and as Next Friend of I R G G, a Minor; Hector Gonzalez, Jr. This is a case where the opinion was issued on January 7, 2011, by the United States Court of Appeals for the Fifth Circuit.
This is a lawsuit between family members of a deceased sandblaster and RLI Insurance Company (RLI). The court ultimately ruled in favor of RLI based on a policy exclusion.
The basis for this suit is based on Hector having died due to silica exposure.
In 2008, Hector died. The underlying lawsuit alleges that Hector was exposed to dangerous levels of silica dust through sandblasting while employed by ICO, Inc. It is further alleged that Hector’s death was caused by respiratory failure caused by silicosis, a respiratory disease caused by prolonged inhalation of silica dust.
RLI had issued several insurance policies to ICO, including an umbrella liability policy. After receiving the lawsuit papers, ICO forwarded them to RLI and requested that it defend the lawsuit on ICO’s behalf under the umbrella policy. RLI filed papers with the court requesting the court to state that there was no coverage under the policy for the claim being asserted. The court eventually ruled on behalf of RLI.
The court said that the pollution exclusion on its face excludes injuries arising from exposure to “all … irritants and contaminants.” The Occupational Safety and Health Administration has classified silica dust as an air contaminant. This can be found at, 29 C.F.R. Section 1910.1000. Inhaling silica dust can result in silicosis, a type of pneumoconiosis. Pneumoconiosis is a “disease of the lungs caused by the habitual inhalation of irritant material.” In addition, several district courts have applied substantially similar pollution exclusions to silica-related claims and have concluded that they are pollutants. Silica dust is unambiguously a “pollutant” under the language of the Pollution Exclusion.
The family next argued that the Pollution Exclusion was ambiguous when considered in conjunction with the rest of the Umbrella Policy. They argued the exclusion was too broad and a reasonable person would not know what it was excluding. The Court replied stating; “neither conflicting expectations not disputation is sufficient to create an ambiguity.” They then said, the language in the Pollution Exclusion unambiguously applies to claims arising from “contamination of any environment by pollutants that are introduced at anytime, anywhere, in any way.”
The family also argued that a separate Asbestos Exclusion in the Umbrella Policy created an inference that silca dust claims are not included by the general Polution Exclusion. The court addressed this by saying “superfluous exceptions are commonplace” in insurance contracts and “have the effect merely of making assurance doubly sure.” Even if the Pollution Exclusion covers the same claims as the Asbestos Exclusion, this does not raise an inference that the Pollution Exclusion does not cover silica dust claims. The existence of a separate exclusion for asbestos does not create ambiguity in the Pollution Exclusion.
In ending, the court said, “Silica dust is unambiguously a ‘pollutant’ under the Pollution Exclusion. Because the Underlying Lawsuit only alleges injuries arising out of the contamination of air from silica dust, RLI does not have a duty to indemnify ICO for the claims in the Underlying Lawsuit as a matter of law.”
This case serves an another example of how courts review these types of cases and the analysis they apply in reaching their decisions.