Opinion
No. 06-2429-BLS2.
November 16, 2010, November 22, 2010, November 26, 2010.
Defendants allege that in 1996 plaintiff destroyed some 500 boxes of documents relating to plaintiff's 150-year history of operations at the Sawyer Passway Site (Site); that in 1998 and 1999, plaintiff destroyed another 214 boxes; and that in 2006, just prior to commencing this action, plaintiff destroyed additional documents. Plaintiff responds that most of the documents destroyed were not relevant to the manufactured gas plant (MGP) which is the subject of the complaint, or were cumulative of substantial documents and information which plaintiff did provide defendants. Defendants move for dismissal or, in the alternative, for exclusion of certain evidence, and adverse inference instructions to the jury. After hearing, and for the reasons stated below, the motion will be allowed in part.
Defendants also allege that, a few months after commencing this action, plaintiff "undertook destructive testing of soil and subsurface structures at the Site, without any notice to Defendants." Defendants' Memorandum, at 2-3. The Court concludes that the testing was not so destructive of materials and soil at those locations as to inflict undue prejudice on defendants.
DISCUSSION
In evaluating the parties' memoranda and affidavits, the Court is mindful of the following principles governing the law of spoliation in Massachusetts.
The doctrine of spoliation "permits the imposition of sanctions and remedies for the destruction of evidence in civil litigation."Keene v. Brigham and Women's Hosp., Inc., 439 Mass. 223, 234 (2003). However, "the sanction should be narrowly `addressed to the precise unfairness that would otherwise result.'"Wiedmann v. The Bradford Group, Inc., 444 Mass. 698, 706 (2005) (quoting Keene at 235). The doctrine is "based on the premise that a party who has negligently or intentionally lost or destroyed evidence known to be relevant for an upcoming legal proceeding should be held accountable for any unfair prejudice that results." Keene, at 234. That the missing records "vanished years before the commencement of the lawsuit does not make the doctrine of spoliation inapplicable . . . `if a litigant . . . knows or reasonably should know that the evidence might be relevant to a possible action.'"Id. (citation omitted).
As a general rule, a judge "should impose the least severe sanction necessary to remedy the prejudice to the nonspoliating party." Id., at 235. Generally, the "extreme sanction" of dismissal or default judgment should be predicated on a finding of wilfulness or bad faith, and ordinarily would not be appropriate in a case of negligent spoliation. Id., at 235-236.
"Massachusetts affords a greater range of remedies for spoliation than the majority of jurisdictions, which limit relief to permitting an adverse inference against the responsible party." Gath v.M/A-Com, Inc., 440 Mass. 482, 488 (2003). The Supreme Judicial Court has held that a judge "may exclude evidence to remedy unfairness caused by the destruction or alteration of evidence by a party to litigation or by persons affiliated with a party,"Scott v. Garfield, 454 Mass. 790, 799 (2009), citingFletcher v. Dorchester Mut. Ins. Co., 437 Mass. 544 (2002). Remedies also include "allowing the party who has been aggrieved by the spoliation to present evidence about the preaccident condition of the lost evidence and the circumstances surrounding the spoliation," Scott, supra, 454 Mass. at 799, quoting Gath, and instructing the jury on the inferences that may be drawn from the spoliation, see Gath, 440 Mass. at 488. These remedies may be cumulative, "as determined by the judge from the circumstances of each case, in the exercise of broad discretion." Id. In deciding the issue, the Court may place the burden on the spoliating party to prove that there was no fault in its failure to preserve the evidence lost. Scott, at 799.
Guided by the foregoing, and the materials submitted, the Court finds and rules as follows.
1. Plaintiff's destruction of documents in 1996, 1998-1999, and 2006, was negligent, not wilful or in bad faith. Accordingly, the "extreme sanction" of dismissal is not warranted. Keene, at 235-236. This is not a case likeKeene, in which the discarded documents comprised the only record of the alleged medical malpractice. Here, defendants have received a relatively vast amount of discovery regarding the Site and plaintiff's conduct.
2. Plaintiff anticipated insurance coverage litigation concerning the Site not later than 1985.
3. Plaintiff generally discarded the subject documents pursuant to plaintiff's document retention policy.
4. Plaintiff's destruction of documents in 1996, 1998-1999, and 2006, and the documents themselves, are variously described in the depositions of participants and others with knowledge about the documents destroyed (e.g., Messrs. Carroll, Joyce, LaBelle, Dik, Beauvias, Sundstrom, Bourque, Foote, Gatherum), and lists generated describing the documents. After reviewing those depositions and lists, the Court finds (a) that, at the time plaintiff discarded such documents, plaintiff had notice of the potential claims that underlie this action; (b) that, while the documents discarded related largely to non-MGP operations, there were also documents relevant to the Site and to insurance matters pertaining thereto (as demonstrated, e.g., by the contents of the four boxes of documents that were retrieved by plaintiff's employees from the 1996 destruction); and (c) that defendants have suffered sufficient prejudice from the destruction of those documents to warrant some measure of relief.
ORDER
In view of the significant amount of information which defendants have obtained about the Site, and for the reasons stated above, it is hereby ORDERED as follows.
(1) Defendants may offer evidence at trial concerning the plaintiff's destruction of documents and the circumstances thereof, and plaintiff may offer evidence regarding the same. The trial judge may circumscribe such evidence to the extent necessary to allow each side generally to explain to the jury what was done, and to offer lists and other records of the documents destroyed, while preventing lengthy presentations of cumulative or unnecessary detail. Defendants shall be entitled to an instruction that the jury may (but are not required to) infer generally from such evidence that among the documents destroyed were documents pertaining to the matters at issue in this case, and that such documents contained information favorable to defendants and unfavorable to plaintiff.
(2) Where, based on records of plaintiff referring to or identifying specific documents or specific categories of documents which were destroyed (see, e.g., Affidavit of Michael S. Komar, Ex.'s AAA, BBB, EEE, GGG, HHH), there is a particularized basis upon which to conclude that such documents or categories of documents were relevant to plaintiff's claim, defendants may seek an instruction to the jury that the jury may (but are not required to) infer that such specifically identified documents or categories of documents contained information favorable to defendants and unfavorable to plaintiff with regard to the subject matter thereof. The trial judge will determine whether, in light of the evidence at trial, the probative value of the evidence of such documents or categories outweighs the prejudicial effect thereof.
(3) Defendants shall compile a list of all such references (i.e., from plaintiff's lists and other records, including deposition excerpts, identifying specific documents or categories of documents destroyed), which they seek to offer at trial, and shall serve them in the form of a motion in limine on a date to be scheduled by the Court at the final pre-trial conference.
MEMORANDUM OF DECISION AND ORDER ON PLAINTIFF'S MOTION FOR PARTIAL SUMMARY JUDGMENT AND ON DEFENDANTS' MOTIONS FOR SUMMARY JUDGMENT
From 1853 until 1952, plaintiff Fitchburg Gas Electric Light Company (FGE) owned and operated a manufactured gas plant (MGP) on a tract of land located in Fitchburg known as the Sawyer Passway Site (site). Like other local utilities, FGE manufactured gas, from coal and coke, to light street lights, heat homes, power cooking stoves, and provide indoor lighting. The manufacturing process generated hazardous materials at the site. In this action FGE seeks a declaration that several primary liability insurance policies issued by defendants OneBeacon American Insurance Company (OneBeacon) and The Travelers Indemnity Company (Travelers), respectively, obligate them to defend and indemnify FGE for cleanup costs at the site.
The matter is before the Court on FGE's motion for partial summary judgment based on (1) trigger of coverage, (2) notice, and (3) the owned property exclusion; and on defendants' motions for summary judgment based on (1) allocation and post policy period damage, (2) the owned property exclusion, (3) the voluntary payments condition, (4) the expected or intended property damage exclusion, (5) the pollution exclusion, and (6) the statute of limitations and laches.
The parties' motions are before the Court as follows. After FGE and defendants filed their initial motions for summary judgment in 2009 (2009 motions), and after a hearing thereon, FGE filed a First Amended Complaint. On November 18, 2010, OneBeacon submitted a "Motion for Summary Judgment Under Its Primary Policies," and Travelers submitted a "Supplemental Motion for Summary Judgment Regarding Additional Policies" (2010 motions). Each of those motions incorporates the grounds stated in their 2009 motions and listed above. This memorandum and order will address those grounds.
The relevant policy language is the same for purposes of the 2009 and 2010 motions: "[The First Amended Complaint] for the first time asserted claims for breach of contract under five OneBeacon primary liability policies for the years of 1980 to 1985 [which] contain either the same or relevantly identical policy terms, conditions and exclusions that formed the bases for the Defendants' [initial motions for summary judgment]" (OneBeacon's memorandum in support of its 2010 motion, at 2); "Because the Five Additional Policies [alleged in the First Amended Complaint] have identical or similar applicable wording as the Travelers policies . . . which are the subject of the Initial [2009] SJ Motions, the Initial SJ Motions equally apply to the Five Additional Policies." Travelers Supplemental Motion, at 2.
DISCUSSION
Summary judgment may be granted where, viewing the evidence in the light most favorable to the non-moving party, all material facts have been established and the moving party is entitled to judgment as a matter of law. Cabot Corp. v. AVX Corp., 448 Mass. 629, 636-637 (2007); Mass. R. Civ. P. 56(c). "The moving party must establish that there are no genuine issues of material fact, and that the nonmoving party has no reasonable expectation of proving an essential element of its case." Miller v.Mooney, 431 Mass. 57, 60 (2000). See also Pederson v.Time, Inc., 404 Mass. 14, 16-17 (1989).
1. Trigger of Coverage and the Owned Property Exclusion
FGE moves for partial summary judgment on the ground that there can be no dispute that coverage under the policies was "triggered" when property damage resulted during the respective policy periods. Citing Trustees of Tufts Univ. v. Commercial Union Ins. Co., 415 Mass. 844, 853 (1993), FGE argues that there is no requirement that the property damage had to be discovered, or "manifested," during the policy period, nor is the insured required to quantify the amount of damage that happened during the policy period. FGE's Memorandum of Law, at 15.
Defendants do not dispute the latter proposition, but they do argue that continuous groundwater contamination on the site does not constitute covered "property damage" because the owned property exclusion excludes coverage for damage to the site itself. Thus, defendants argue, there can be no "trigger" until off-site property damage is shown to have occurred during the policy periods. Defendants' Joint Opposition, at 1.
Under the policies, defendants "will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of . . . [property damage] to which this insurance applies, caused by an occurrence . . ." Ex. 2, para. 5. "Occurrence" is defined as:
All references to or quotations of language from pertinent policies are taken from Exhibit 2 ("Statement of Agreed Policy Language") to the parties' Joint Pre-Trial Memorandum, filed November 18, 2010. Where the variations among defendants' policies are not significant to the Court's analysis, the Court has not quoted each variant.
an accident, including injurious exposure to conditions, which results, during the policy period, in bodily injury or property damage neither expected nor intended from the standpoint of the insured.
Ex. 2, para. 6. "Property damage" is defined as "injury to or destruction of tangible property." Ex. 2, para. 8. The policies also contain an owned property exclusion, which excludes coverage for property damage to:
(1) property owned or occupied by or rented to the insured, (2) property used by the insured, or (3) property in the care, custody, or control of the insured or as to which the insured is for any purpose exercising physical control.
Ex. 2, para. 10.
Massachusetts courts have not squarely addressed the standard under which a threat of harm to third party property negates an owned property exclusion. In Hakim v. Massachusetts Insurers' Insolvency Fund, 424 Mass. 275, 282 (1997), the court stated that, while "[c]osts incurred for the sole purpose of remediating the [insured's] property are barred by the owned property exclusion," the exclusion does not pertain to "cleanup costs incurred to remediate or prevent further migration of the contaminants to the off-site waterways." The court considered, but did not reach, the question whether an owned property exclusion bars coverage if there is an "imminent threat of, but no actual contamination of, the property of another." Id. at 280, n. 8. In Rubenstein v.Royal Ins. Co. of America, 44 Mass. App. Ct. 842, 854 (1998), the court noted that, pursuant to Hakim, the owned property exclusion does not relieve an insurer from liability for costs if the cleanup is designed to "`prevent further migration of contaminants to the off-site property.'" The court stated that "[t]his is the case even if the contaminating substances are solely on the insured's land." Id. The Court concludes, therefore, that the owned property exclusion does not bar coverage for the cleanup of contaminants on FGE's property as long as the cleanup is designed to prevent damage to off-site property.
What Hakim and Rubenstein have left undecided, however, is the standard by which any threat is to be measured. InRubenstein, the jury found, on the facts of that case and in answer to special questions, that on-site contamination posed "an imminent or immediate threat of additional pollution of the groundwater and migration of the oil beyond the boundaries of the site." Id. at 854.
In Moore v. New England Guar. Ins. Co., Inc. 73 Mass. App. Ct. 1118 (2009) (unpublished decision) (No. 08-P-304, slip op. at 3 (Jan. 30, 2009)), the court concluded that the owned property exclusion applied where the evidence in the summary judgment record "provided no indication of a significant threat" to adjoining property.
In this case, there remain issues of fact regarding off-site contamination and the need for remediation. For example, FGE's expert, Neil S. Shifrin, Ph.D., opined that "contamination did and continues to migrate offsite beyond plant boundaries." DiTullio Aff. I, ex. 5, p. 8. Defendants' expert, Brian L. Murphy, Ph.D., disputes this conclusion, opining that (1) there is no evidence that the DNAPL is still mobile, (2) on the northern portion of the site a till layer and steel sheet pile prevent DNAPL from migrating into the river, and (3) on the southern portion the contamination is far from the river. DiTullio aff. I, ex. 2, p. 8-9. In addition to the differing opinions of the experts, there are issues of fact regarding the rate at which groundwater containing contaminants migrates, the relevant factors in making such a determination, and how and over what period that harm, whether imminent or significant, is to be measured.
Accordingly, the Court concludes that neither side has established entitlement to summary judgment based on the owned property exclusion and whether the policies were triggered.
2. Notice
FGE contends that there is no genuine dispute that its notice to defendants was timely, and seeks summary judgment as to defendants' affirmative defense of untimeliness. Defendants bear the burden of proving that FGE breached the notice provisions of the policies, and that the breach actually prejudiced defendants. SeeEmployers Liab. Assurance Corp. v. Hoechst Celanese Corp., 43 Mass. App. Ct. 465, 472 (1997).
Under the relevant policies, "in the event of an occurrence," FGE is required to provide "as soon as practicable" written notice to its insurers which contains "reasonably obtainable information with respect to the time, place and circumstances thereof, and the names and addresses of . . . available witnesses . . ." Ex. 2, para. 15. Once a claim is made, FGE must "immediately forward . . .every demand, notice, summons or other process received" and/or "each paper . . . received by the Insured . . ." Ex. 2, para. 17.
Defendants argue that FGE knew, long before it gave notice to Travelers and to OneBeacon, that its MGP operations were contaminating the site. Defendants argue that they were "indisputably prejudiced by virtue of the loss of evidence and witnesses over the years, FGE's failure to candidly apprise environmental consultants and regulators of the full extent of MGP operations at the Site, and FGE's failure to undertake any measures to mitigate future potential damage." Jt. Opp., at 3. FGE counters that notice was timely and, in any event, that defendants cannot show actual prejudice if it was not. FGE's Memorandum of Law, at 16.
After reviewing the materials submitted by both sides, and in light of the considerations set out in Hoechst, Eastern Prods. Corp. v. Continental Cas. Co., 58 Mass. App. Ct. 16 (2003), and Darcy v. Hartford Ins. Co., 407 Mass. 481, 486 (1990), the Court concludes that genuine issues of material fact remain regarding both when FGE was required to give notice, and any prejudice to defendants if notice was late.
3. Expected and Intended Damages
The defendants argue that they are entitled to summary judgment where FGE expected or intended that its operation of the manufactured gas plant would result in some harm. They rely on a number of incidents that occurred over the century during which FGE was in operation, including leaks from storage tanks and metal pipes they contend FGE either knew or should have known would leak; improper storage of large amounts of tar; and disposal of waste containing cyanide compounds. The defendants claim that the industry in general, and FGE in particular, was aware that MGPs could and did cause hazardous materials to enter the environment. As support therefor, defendants point to FGE's participation in industry associations, the literature on the dangers of contamination, and the published works of one of FGE's own engineers outlining the damage caused by MGP wastes.
As noted above, the policies define an occurrence as an "accident, including injurious exposure to conditions, which results, during the policy period, in bodily injury or property damage neither expected nor intended from the standpoint of the insured." Ex. 2, para. 6.
Whether the burden as to the expected or intended exclusion falls on FGE or defendants, the Court concludes that genuine issues of material fact remain as to whether FGE actually intended the property damage or knew to a substantial certainty that property damage would result from its actions. See Preferred Mut, Ins. Co. v. Gamache, 42 Mass. App. Ct. 194, 198 (1997) ("when interpreting intentional injury exclusion clauses in policies providing liability coverage for `accidents,' the Supreme Judicial Court has focused on the insured's intent to injure, not merely the insured's intent to act"); Utica Mut. Ins. Co. v. Hamel, 46 Mass. App. Ct. 622, 624 (1999) (coverage excluded where the damage caused by the plaintiffs was "substantially certain, as a matter of law," to cause property damage.).
See Highlands Ins. Co. v. Aerovox, 424 Mass. 226, 230 (1997), quoting Murray v. Continental Ins. Co., 313 Mass. 557, 563, (1943) ("The general rule . . . [is] that a plaintiff seeking to recover for breach of a duty or obligation created by a general clause of a contract, which also contains an exception descriptively limiting such duty or obligation must allege and prove that his cause of action is within the contract and outside the exception; but that where the exception is in another separate and distinct clause of the . . . contract defining . . . the duty or obligation, then the burden is upon the party relying on such exception." (brackets in original));Hanover Ins. Co. v. Talhouni, 413 Mass. 781, 785 (1992), citing McGinnis v. Aetna Life Casualty Co., 398 Mass. 37, 38 (1986) ("The insurer must show the applicability of the clause excluding coverage for injury or damage intended or expected by the insured."). Once the insurer has demonstrated that a policy exclusion applies negating coverage, the burden shifts back to the insured to show an exception to the exclusion.Aerovox, 424 Mass. at 231.
For example, Dr. Shifrin, FGE's expert, concludes that FGE did not deliberately discard tar over the years, and opines that FGE recycled most or all of its tar, sold what it did not recycle, and promptly fixed any known leakage. He further concludes that any leakage from storage tanks was inadvertent and unknown. DiTullio Aff. ex. 5 at 7-9.
Similarly, FGE's participation in professional societies, journal articles outlining the damage caused by MGP wastes, and public law suits and hearings regarding other MGPs, see DiTullio Aff. ex. 2, at 15 (report of defendants' expert, Brian Murphy, Ph.D.), bear upon FGE's knowledge, but do not foreclose the issue. Nor is it sufficient that FGE might have acted recklessly or negligently. See Gamache, 42 Mass. App. Ct. at 202 ("Negligent conduct is not intentional conduct . . . when construing insurance coverage, wanton or reckless conduct is not the legal equivalent of intentional conduct").
Accordingly, the Court cannot conclude, as a matter of law, that FGE expected or intended offsite contamination.
4. Pollution Exclusion
Travelers argues that the pollution exclusion in its policies precludes coverage for property damage "arising from any release of waste or pollutants when the release is expected or intended by the insured," and "arising from any release of petroleum derivative into a body of water when the release is `not sudden.'" Memorandum of Law in Support of the [2009] Motion Re Expected or Intended Damages and the Pollution Exclusion, at 33; see full text of policies in Ex. 2.
Travelers notes that, while in the "occurrence" definition, FGE must have expected or intended "property damage," Travelers may establish the pollution exclusion by showing that FGE expected or intended any "emission, seepage, release or escape" of waste pollution. See, e.g., Travelers Ins. Co. v. Waltham Indus. Labs Corp., 722 F. Supp. 814, 824 (D. Mass. 1988), quotingFireman's Fund Ins. Co. v. Ex-Cell-O-Corp., 662 F. Supp. 71, 75-76 (E.D. Mich. 1987) ("application of the pollution exclusion depends entirely on process by which pollutants entered the environment . . . The decisive inquiry is not whether the policy holders anticipated damage, or whether they regularly disposed of hazardous waste, but whether the pollution entered the environment unexpectedly or unintentionally").
The defendants nevertheless rely on essentially the facts on which they based their argument that damages were expected or intended to support their contention that discharge was expected or intended. For the same reasons as before, summary judgment is not appropriate.
5. Voluntary Payments Condition
The defendants contend that the voluntary payments conditions in the relevant policies preclude coverage for payments made by FGE pursuant to its agreement with the Department of Environmental Protection (DEP) to remediate pollution at the site, without first obtaining the consent of its insurers. While FGE opposes the motion on several grounds, the Court need address only FGE's contention that defendants have not demonstrated prejudice as a matter of law.
"The insured shall not, except at his own cost, voluntarily make any payment, assume any obligation or incur any expense other than for first aid to others at the time of accident." Ex. 2, para. 14.
In Darcy v. Hartford Ins. Co., 407 Mass. at 490, the court held that where an insurer claims a breach of a provision that is designed primarily to protect that insurer's interest, and when that interest has not been jeopardized by the insured's breach, "in the sense that the insured's infraction does not seriously impair the insurer's investigation of defense of the action, there is no persuasive reason to permit the insurer to deny coverage under the policy. We now . . . require[] a showing of prejudice by the insurer." See also Hoechst, 43 Mass. App. Ct. at 481 (insured's breach of voluntary payment provision, like breach of a notice provision, should not avail insurer unless insurer sustains burden of proving actual prejudice);Sarnafil Inc. v. Peerless Ins. Co., 418 Mass. 295, 305 (1994) (before insurance company can be relieved of responsibility based on insured's violations of insurance provisions, insurer would have to show that it had incurred actual prejudice).
Augat, Inc. v. Liberty Mut. Ins. Co., 410 Mass. 117 (1991) does not, as the defendants argue, compel a different result. There, prior to any notice by Augat to its insurer, Augat agreed with the Department of Environmental Quality Engineering (DEQE) to a resolution whereby, on February 2, 1984, the Commonwealth "simultaneously filed its complaint, a consent order signed by Augat and the Commonwealth, and a proposed form of judgment in Superior Court. Four days later, final judgment entered on the complaint imposing civil penalties and requiring that Augat decontaminate the site at its own expense."Id. at 118-119. On February 9, 1984, Augat notified Liberty Mutual that "a situation has arisen . . . which may give rise to a claim" under the policy. Id. at 119. Not until July 30, 1986, did Augat notify Liberty Mutual of the court order. Id.
The court concluded that, although the voluntary policy provision was designed to give the insurer an opportunity to protect its interests, on the facts of the case, after Augat had agreed to a settlement, entered into a consent judgment, assumed the obligation to pay the entire cost of the cleanup, and indeed paid a portion of the cost, "it was too late for the insurer to act to protect its interests. There was nothing left for the insurer to do but issue a check." Id. at 123.
The facts here are markedly different, principally in light of the substantial advance notice which FGE gave defendants, beginning in 1984 and 1985, of the DEP's notice of contamination at the site. While defendants maintain that the last communication between the parties left the ball in FGE's court, the ball was at least in play, whereas Augat had hidden the ball until after the fact. The issue of prejudice is a live issue here, and precludes summary judgment.
6. Post Policy Period Damages
The law applicable to defendants' motion based on allocation has been resolved by the Supreme Judicial Court in Boston Gas Co. v. Century Indem. Co., 454 Mass. 337 (2009). Issues of fact as to allocation of FGE's damages are to be resolved at trial in accordance with the procedure set out in Boston Gas.
Defendants' 2010 motions for summary judgment note their 2009 motion's request for summary judgment "as to any property damage arising out of seven specific releases [between 1979 and 1997] that occurred after the expiration of the last policy period of policies then in the case." OneBeacon's Memorandum in support of its 2010 motion, at 8. They note also that "FGE responded to this motion by pointing out that (1) six of the seven releases (all except the 1979 Holder D tar disposal release) arose out of FGE's electric operations; and (2) FGE did not seek insurance coverage for them because its claims were limited to property damage arising out of gas manufacturing operations." Id. See also FGE's Opposition to Defendants' [2009] Motion re: post policy period damage, at 3: "Defendants identify seven instances of contamination that happened after January 1, 1976. Six of these identified instances resulted from Fitchburg Gas' electric operations which are not at issue in this litigation, and thus are irrelevant and moot." Because "FGE's First Amended Complaint did not assert claims for property damage arising out of electric operations," OneBeacon's Memorandum at 8, defendants contend that summary judgment is appropriate as to "any property damage arising out of the six electric operation releases."Id. at 8-9.
FGE responds by arguing that its claims "are no longer limited to property damage arising out of gas manufacturing operations, but also include covered property damage caused by leaks and spills of oil arising out of Fitchburg Gas' electrical operations. Under the First Amended Complaint, Fitchburg Gas seeks indemnification for all of its liability payments and defense costs for property damage related to the Sawyer Passway Site." FGE's Opposition to OneBeacon's 2010 motion, at 2-3. Moreover, FGE argues, defendants "already have obtained full discovery on all of the oil spills that are at issue in this action." Id. at 3.
Having compared the initial complaint line by line with the First Amended Complaint, the Court sees no significant difference between the two with regard to the damage for which recovery is sought; in that respect, they are essentially identical (both refer generically to "environmental property damage associated with the MGP Site"). Nor does First Amended Complaint make any reference to electrical operations. Moreover, OneBeacon summarizes the substantial discovery that defendants would have had to take had damage from electrical operations been in issue. OneBeacon's Reply, at 2, n. 1.
The Court concludes from the above that the damage at issue in this case is property damage allegedly resulting from environmental contamination associated with the MGP operations, not FGE's electrical operations. Accordingly, defendant's motion as to the latter damage, whether pre-or post policy period, will be allowed. To the extent that defendants seek summary judgment as to post policy period MGP property damage, the motion will be denied.
7. Statute of Limitations and Laches
The defendants claim that, since there was no communication between FGE and OneBeacon after FGE's February 1990 letter, and none between FGE and Travelers after January, 1999, the lapse of time between those dates and the filing of this action in 2006 was "the equivalent of a denial of coverage and a breach" of their duties under the policies for purposes of accrual of the statute of limitations. Therefore, they argue, FGE waited beyond the six-year statute of limitations to file its breach of contract claim.
On the summary judgment record, the Court concludes that genuine issues of fact remain as to when FGE's cause of action against either defendant arose, rendering summary judgment as to the statute of limitations or laches inappropriate.
ORDER
For the reasons set out above, plaintiff FGE's motion for summary judgment is DENIED ; defendants' 2009 motion for summary judgment regarding post policy period damage is ALLOWED as to property damage from FGE's electrical operations; and in all other respects defendants' 2009 motions for summary judgment are DENIED . It is further ORDERED that the foregoing rulings as to defendants' 2009 motions apply equally to OneBeacon's Motion for Summary Judgment Under its Primary Policies, and defendant Travelers' Supplemental Motion for Summary Judgment Regarding Additional Policies, each filed November 18, 2010, to the extent that the latter motions incorporate the grounds stated in the defendants' 2009 motions.
To the extent that defendants' recent motions raise any additional grounds for summary judgment, the clerk is requested to schedule a hearing on those grounds at a final pretrial conference to be scheduled before the trial judge, or on such other date as the judge may choose.