The Georgia Court of Appeals has ruled in a split panel decision that the pollution exclusion in a liability policy does not apply to lead paint claims. Smith v. Georgia Farm Bureau Mut. Ins. Co. (10 June 2015). In this case, a tenant in a residential rental house brought a lawsuit against her landlord, alleging that her daughter had incurred permanent disabilities as a result of ingesting lead paint chips and dust. The landlord’s liability insurer declined coverage on the basis of the pollution exclusion. However, the Court of Appeals held the pollution exclusion did not apply in this case, because the wording of the exclusion did not specifically state that it applied to lead paint.
The reasoning of the court’s decision is seemingly inconsistent with the Georgia Supreme Court’s decision in Reed v. Auto- Owners Ins. Co., 284 Ga. 286 (2008), in which the Court held the pollution exclusion under Georgia law is not limited to traditional environmental pollution, but also applies to pollutants within a home. One of the Court of Appeals judges concurred specifically in the result on this point, which, under Georgia appellate court rules, makes the decision non-binding precedent.