Belt Painting Corp.(Belt), a painting subcontractor, purchased a commercial general liability policy from TIG Insurance Company (TIG). The policy, which had a $1,000,000 limit, contained a standard form "Total Pollution Exclusion Endorsement." The exclusion barred coverage for 'bodily injury' or 'property damage' related to the actual, alleged or threatened discharge, dispersal, seepage, migration, release, or escape of pollutants. The form defined pollutants as "any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste."

In 1997, Joseph Cinquemani sued Belt, claiming he was injured by inhaling paint or solvent fumes in an office building where Belt was doing stripping and painting work. Belt reported the lawsuit to TIG, seeking defense and indemnification. TIG refused to cover the claim, citing the policy pollution exclusion. Belt sought a declaratory judgment contending that the exclusion did not apply because the underlying injury was not caused by environmental or industrial pollution. TIG sought and was granted a summary judgment from the trial court, citing that the claim was subject to the pollution exclusion. On appeal, an appellate court reversed and granted summary judgment to Belt. Rather than depend upon TIG's literal reading of the pollution exclusion, the court ruled that the clause applied only to damages that "are truly environmental in nature" or result from "pollution of the environment." TIG appealed to the New York Court of Appeals.

The court agreed with the Appellate Division based on the following rationales:

• The policy language did not clearly and unequivocally exclude a personal injury claim arising from indoor exposure to Belt's operations.
• Acceptance of the definition of pollutants would infinitely expand or enlarge its meaning, contradicting common understanding and the reasonable expectations of a businessperson.
• Third, even if paint or solvent fumes are within the definition of "pollutant," the exclusion does not unambiguously apply to ordinary paint or solvent fumes that drifted a short distance from the insured's work area
• A rejection of TIG's contention that the exclusion wording indicating an intent to exclude both indoor and outdoor pollution.

The court concluded that the exclusion was ambiguous, affirmed the order of the Appellate Division and granted summary judgment in favor of Belt.

Belt Painting Corp., Respondent, v. TIG Insurance Company, Appellant New York Court of Appeals. No. 86. Filed July 1, 2003. Affirmed. CCH Personal and Commercial Liability Cases. Paragraph 7660.