LANDLORD ASSERTS TENANT'S CONTAMINATION CONSTITUTED TRESPASS
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Commercial General Liability |
Absolute Pollution Exclusion |
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Personal Injury |
Ali & Sons, Company, Samir Ali, and Northway
Cleaners (Ali & Sons) operated a dry-cleaning business from July 1, 1991 to
June 30, 2001 on premises leased from lessor Gilbert Raphael. The premises were
located at 7501 West Irving Park Road in Chicago. Under the lease, Ali &
Sons also had use of the boiler room area of the premises at 7515 West Irving
Park Road.
Raphael filed a complaint against Ali & Sons in
November 2001, alleging pollution and contamination in violation of the
Illinois Environmental Protection Act. The complaint also alleged that such
contamination resulted in a trespass upon the lessor's property.
National Fire and Indemnity Exchange (NFIE) was Ali
& Sons' insurer for a portion of the lease period. NFIE filed a complaint
for declaratory relief, claiming it did not owe a duty to defend or indemnify Ali
& Sons under a policy covering the period from January 1, 1990 to January
1, 1993 based on an absolute pollution exclusion contained in the policy. It
also argued that there was no personal injury coverage due to trespass because Ali & Sons had exclusive
possession of the premises until 2001 so
trespass was not a permitted complaint.
Ali & Sons conceded the pollution exclusion
applied but argued for personal injury coverage by virtue of the trespass
claim. They argued that because the 7515 property was not exclusive that
trespass was possible. The trial court found in favor of NFIE.
The appellate court affirmed the trial court
decision. It stated that Ali & Sons provided no justification for their
trespass allegation. As a result, the court found that NFIE did not owe a duty
to defend or indemnify Ali & Sons in the Raphael lawsuit because the
personal injury provisions did not apply.
National Fire and Indemnity Exchange v. Ali & Sons, Company-No. 1-03-1091-Appellate Court of Illinois, First District, Sixth Division-January 16, 2004-803 North Eastern Reporter 2d 636