Montrose Chemical Corporation of California, which had already gone out of business, manufactured the pesticide commonly called DDT (dichloro-diphenyl-trichlorethane) at one of its sites in Torrence, California. Montrose had manufactured this chemical since about 1947 until the time it went out of business in 1982. When Federal law made it illegal to sell DDT domestically, Montrose continued production for export outside the USA.

It was determined that seven insurance companies provided coverage for Montrose during the period of time DDT was manufactured, ending with Admiral Insurance Company. Admiral provided coverage between 1982 and 1986.

Law suits were filed against Montrose for damage and injury from the disposal of hazardous or toxic wastes at a number of sites in California. Although the other 6 carriers provided defense under reservation of rights, Admiral denied coverage and defense contending that its policy did not have to respond-as the coverage trigger resulting in loss and injury did not occur during its policy periods and that the actions were uninsurable as losses-in-progress existing prior to the inception of Admiral's policies.

The initial trial court, in a summary judgment, decided in favor of Admiral. Montrose appealed.

The California Court of Appeals overturned the summary judgment decision of the trial court. The appeals court based its ruling upon the fact that the property damage was a continuous, progressive deterioration that was still in progress throughout the period covered by Admiral's policies, thus triggering coverage. It was further contended that the wording in the CGL policy was not strong enough to preclude such losses. It also decided that the loss-in-progress rule did not preclude coverage in this case. Finally, it decided that the expected or intended exclusion did not bar coverage in a progressive damage situation.

The case went to the California Supreme Court and in July of 1995, the decision of the appeals court was affirmed by the supreme court.

Montrose Chemical Corporation of California, Plaintiff and Appellant vs. Admiral Insurance Company, Defendant and Respondent. CA Supreme Court #S026013. Filed July 3, 1995. CCH 1995 Fire and Casualty Cases, Paragraph 5376.