This year, the Supreme Court of Appeals of West Virginia issued an important decision concerning whether a carbon monoxide leak is a single or multiple occurrence under a liability insurance policy. Kosnoski, et al. v. Rogers, et al., No. 13-0494. The number of occurrences can be a critical issue in insurance coverage litigation because it often determines the number of deductibles the policyholder must pay, as well as the maximum coverage limit a policyholder will receive.
The Woulard and Kosnoski families, lived in two different apartments in the same duplex. On September 4 and 5, 2011, members of those families suffered serious injuries from carbon monoxide poisoning, one of whom, Justin Kosnoski, died. Tests run by the local fire department revealed that the carbon monoxide level in the Woulard apartment was 358 parts per million (“ppm”), the level in the Kosnoski apartment was 258 ppm and the level at the basement door, where the gas leak originated, was 658 ppm, all much higher than the average carbon monoxide level for a home. The families sued the property’s owner, managers, and insurance company, Erie Insurance Property and Casualty (“Erie”). Among other things, the families sought a declaratory judgment against Erie that the carbon monoxide poisoning constituted more than one occurrence. Erie’s policy provided a per occurrence limit of $1,000,000 and a general aggregate limit of $2,000,000, and it defined “occurrence” as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions.”
In April 2013, the trial court granted summary judgment to Erie, holding that the families’ injuries constituted only one occurrence under the policy, their carbon monoxide injuries were a single continuous or repeated exposure to substantially the same general harmful conditions. On appeal, the families argued that because they and the decedent were exposed to carbon monoxide at different times during the night of September 4 and the early morning hours of September 5, and were exposed to varying levels of carbon monoxide, there was more than one occurrence. They also argued that although the apartments were in the same duplex, they were legally and factually separate places.
The Supreme Court of Appeals affirmed, holding that it was “clear from the record” that “there was a leak of carbon monoxide from a single source, the gas boiler furnace. While the gas undoubtedly traveled to different rooms within the single building at different times over several hours, the injuries to petitioners and the decedent were from continuous or repeated exposure to substantially the same general harmful conditions. Relying on basic principles of insurance policy interpretation, the Court found that “the definition of occurrence at issue in the instant case is not ambiguous . . . .” The Court therefore concluded that petitioners’ carbon monoxide injuries were a single occurrence under the policy.
While the Court’s holding in Kosnoski is consistent with its prior decisions concerning the number of occurrences under a liability policy, it is a useful reminder that these issues are often highly fact-intensive and require a thorough understanding of the relevant policy language and applicable law.