Insurers Not Obligated in Pollution Suit

In 1977 and 1978 Aardvark Associates Inc. transported drums of industrial waste from Highson Chemicals in Deagertown, PA, to disposal sites in Ashtabula County, Ohio. The US Environmental Protection Agency (USEPA) discovered discharges of hazardous materials at the sites in 1981 and 1982, notified Aardvark, and told Aardvark it may be responsible for cleanup costs under federal law. The USEPA then sued Aardvark. After it received the USEPA's initial letters, Aardvark notified its general liability insurers from 1981 to 1985, the Insurance Company of North America and Northern Insurance Company of New York. All of the policies contained a standard clause that generally excluded coverage for pollution damage except sudden and accidental damage. Both insurers sought determinations that they had no duty to defend Aardvark. The trial court ruled for the insurers.