DIV SUMNER STREET LLC v. GREAT AMERICAN INSURANCE COMPANY (2021)

MEMORANDUM AND ORDER PURSUANT TO RULE 23.0

This is a case about the scope of a particular exclusion in an insurance policy purchased by the plaintiff, DIV Sumner Street, LLC, from its insurer, defendant Great American E&S Insurance Company. The plaintiff appeals from the judgment of a Superior Court judge entered in favor of the defendant.² We affirm.

The background of this case is well known to the parties and will not be rehearsed in detail here. The question before us is whether the excavation and removal costs of soil contaminated by asbestos are excluded from coverage under an endorsement (“endorsement 9”) with respect to “Coverage B,” the provision under which coverage was sought in this action. Endorsement 9 provides an exclusion for costs “based upon, arising out of, or related to any ․ CONTAMINATED SOIL that is excavated or otherwise disturbed and, thereafter, removed from the COVERED LOCATION.”

The plaintiff's argument is that the word “thereafter” indicates that only those costs that arise once the contaminated soil has been removed from what all agree is a covered location in this case are excluded from coverage. The plaintiff argues that any other reading renders the word “thereafter” superfluous.

The defendant asserts that this argument was not adequately raised below. We need not decide the waiver issue, because we disagree with the plaintiff's argument on its merits. The adverb “thereafter” appears to be included in this clause solely for emphasis. Because of the laws of physics, contaminated soil cannot be removed from any location from which it originates without being “excavated or otherwise disturbed” prior to that removal. “Thereafter” thus necessarily has a role only in providing emphasis, whatever the meaning of this exclusion. Put another way, whatever these provisions of the insurance policy mean with respect to coverage of contaminated soil removed from the covered site, that contaminated soil will necessarily have been excavated or disturbed and “thereafter” removed.³

The actual question before us is what is covered with respect to such soil. We agree with the plaintiff that costs with respect to contaminated soil do not come within this exclusion unless and until that contaminated soil is removed from the covered location. That is not to say, however, that the only costs with respect to that soil that are excluded are those that arise after the point of removal. The exclusion with respect to costs associated with removed contaminated soil is broad. The exclusion in endorsement 9 refers to costs “based upon, arising out of, or related to” such soil. Though the costs of excavation and anything else done with the contaminated soil before its removal from the covered location take place before that soil is “CONTAMINATED SOIL ․ removed from the COVERED LOCATION,” if that soil is ultimately removed from the covered location, those become costs “related to” “CONTAMINATED SOIL that is excavated or otherwise disturbed and, thereafter, removed from the COVERED LOCATION.”

Consequently, the costs for which the plaintiff sought coverage under Coverage B of the insurance policy are excluded from coverage under Coverage B by the language in endorsement 9. The conclusion by the judge that those costs were not covered in that way by the policy therefore was correct.

Judgment affirmed.

FOOTNOTES

2.   As a preliminary matter, the plaintiff, who brought this appeal, argues that it is premature for us to hear its appeal because, in violation of Mass. R. Civ. P. 58 (a), as amended, 371 Mass. 908 (1977), there is no docket entry indicating entry of final judgment, nor is there a “separate document” indicating that judgment. Rather, the docket reflects entry of the judge's decision on February 13, 2020, that “judgment shall enter for the defendant.” The appellant's notice of appeal was filed within thirty days of the entry of this item on the docket. In these circumstances, the claim by the plaintiff that its own appeal is premature is not availing. See Brown v. Quinn, 406 Mass. 641, 646 (1990).

3.   Neither party has suggested that this clause has anything to do with soil originating in and excavated from some other location that is found stored on the covered location, which, if the clause were read to require that the excavation take place in the covered location, might in some sense be “removed” without being “excavated” –- at least at the covered location –- and before being “disturbed.” Although this might give some more substantive meaning to “thereafter,” in the absence of any evidence that any such thing has ever happened, or that it was the object of this provision, we decline to read the provision in this way.