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Johnson v. Clarendon Nat'l Ins. Co.

Court of Appeal of California, Fourth Appellate District, Division Three

February 4, 2009, Filed

G039659

Opinion

This case originated with a landlord's negligence in maintaining the walls and roof of a condominium unit, and in overwatering the yard around the structure. The combination of these acts caused water to leak inside the structure, which in addition to the typically warm California climate, and the presence of naturally-occurring airborne mold spores, caused toxic mold to grow in and around Carol Johnson's home. For several years, Carol Johnson and her family suffered from various mold-related medical ailments and they sued the landlord to recover damages.

The primary legal question raised in this appeal is whether airborne toxic mold spores, in the context  [*2] of this case, qualify as a pollutant or contaminate, and if so, whether injuries caused by exposure to the mold are excluded from coverage under the landlord's insurance policies issued by Constitution Insurance Company (Constitution) and Clarendon National Insurance Company (Clarendon). Both policies contained essentially identical pollution exclusion clauses, denying coverage for any injuries arising from the introduction or "discharge, dispersal, seepage, migration, release or escape of 'pollutants.'"

The California Supreme Court has analyzed a similar pollution exclusion clause in the case of MacKinnon v. Truck Ins. Exchange (2003) 31 Cal.4th 635 (MacKinnon). After considering the historical evolution of the pollutant clause, conflicting authority from other jurisdictions, and its own application of California contract law, the Supreme Court held the exclusion was intended to cover what is understood by the policyholder to be substances typically associated with pollution of the environment. It created a test for coverage as being dependent not only upon the type of pollutant, but also how it is released into the environment. (Id. at pp. 650-654.) Applying the MacKinnon test here,  [*3] we conclude neither the dispersal of clean water nor the negligent building maintenance resulting in an isolated incident of mold growth would necessarily qualify as the escape or introduction of a conventional environmental pollutant. Because the pollution exclusion does not plainly or clearly exclude mold-related injuries from coverage, it must be interpreted narrowly against the insurer. Accordingly, we affirm the judgment made in Johnson's favor.

FACTS

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2009 Cal. App. Unpub. LEXIS 972 *; 2009 WL 252619

CAROL JOHNSON et al., Plaintiffs and Respondents, v. CLARENDON NATIONAL INSURANCE COMPANY et al., Defendants and Appellants.

Notice: NOT TO BE PUBLISHED IN OFFICIAL REPORTS. CALIFORNIA RULES OF COURT, RULE 8.1115(a), PROHIBITS COURTS AND PARTIES FROM CITING OR RELYING ON OPINIONS NOT CERTIFIED FOR PUBLICATION OR ORDERED PUBLISHED, EXCEPT AS SPECIFIED BY RULE 8.1115(b). THIS OPINION HAS NOT BEEN CERTIFIED FOR PUBLICATION OR ORDERED PUBLISHED FOR THE PURPOSES OF RULE 8.1115.

Prior History:  [*1] Appeal from a judgment of the Superior Court of Orange County. Super. Ct. No. 05CC10891. James Di Cesare, Judge.

Disposition: Affirmed.

CORE TERMS

pollutant, pollution exclusion, coverage, insured, contamination, dispersal, toxic mold, environmental, property damage, landlord, bodily injury, pesticides, irritant, environmental pollution, insurance company, policies, spores, biological, occurrence, injuries, Creek, words, policy language, exposure, policy period, apartment, odors, exclude coverage, circumstances, aspergillus