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Sentinel Mgmt. Co. v. New Hampshire Ins. Co.

Court of Appeals of Minnesota

May 13, 1997, Filed

C8-96-2335

Opinion

 [*297]  OPINION

SHORT, Judge

After denying summary judgment for New Hampshire Insurance Company (New Hampshire), the trial court certified certain insurance [**2]  coverage issues as important and doubtful pursuant to Minn. R. Civ. App. P. 103.03(h). On appeal, New Hampshire argues the asbestos contamination of residential rental properties owned by Sentinel Management Company is not a covered loss under Sentinel's all-risk insurance policy.

FACTS

Sentinel Management Company and other general and limited partnerships (collectively, Sentinel) own and manage certain residential rental properties in the Twin Cities. In 1991 and 1992, Sentinel purchased "all-risk" first-party insurance coverage from  [*298]  New Hampshire. The relevant parts of the policy state:

III. PERILS INSURED AGAINST

Coverage: This policy is extended to insure against all risks of direct physical loss to building(s), subject to provisions and stipulations herein * * * .

* * * *

V. EXCLUSIONS

In addition to the provisions of POP-220 and part A this policy does not insure under this form against:

D. Loss caused by:

1. Wear and tear, deterioration, rust or corrosion, mould, wet or dry rot, inherent or latent defect; smog; smoke, vapor or gas from agricultural or industrial operations; mechanical breakdown, including rupture or bursting [**3]  caused by centrifugal force; settling, cracking, shrinkage, bulging or expansion of pavements, foundations, walls, floors, roofs or ceilings; animals, birds, vermin, termites or other insects; unless loss by a peril not otherwise excluded ensues and then the company shall be liable for only such ensuing loss.

* * * *

This Policy Does Not Insure Under This Form Against:

A. Loss occasioned directly or indirectly by:

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563 N.W.2d 296 *; 1997 Minn. App. LEXIS 550 **

Sentinel Management Company, et al., Respondents, Aetna Casualty and Surety Company, et al., Defendants, vs. New Hampshire Insurance Company, Appellant.

Prior History:  [**1]  Hennepin County District Court. File No. 941429.

Disposition: Affirmed; certified questions answered in the affirmative.

CORE TERMS

contamination, asbestos, physical loss, asbestos fiber, fortuitous, coverage, ensuing loss, wear and tear, insured, all-risk, peril, trial court, ordinance, ceiling, ensuing, insurance policy, summary judgment, wear-and-tear, properties, parties

Civil Procedure, Appeals, Summary Judgment Review, General Overview, Summary Judgment, Entitlement as Matter of Law, Genuine Disputes, Materiality of Facts, Standards of Review, De Novo Review, Insurance Law, Claim, Contract & Practice Issues, Premiums, Policy Interpretation, Judicial Review, Property Insurance, Coverage, All Risks, Fortuity Doctrine, Property Damage, Environmental Law, Hazardous Wastes & Toxic Substances, Asbestos, Real Property Law, Environmental Regulations, Liabilities & Risks, Contractual Relationships, Commercial General Liability Insurance, Asbestos Claims, Indoor Air & Water Quality, Ensuing Loss Provisions, Exclusions, Obligations, Covered Losses, Named Perils