California Supreme Court orders insurance companies to pay for toxic waste cleanup

[JURIST] The Supreme Court of California [official website] on Thursday ruled [opinion, PDF] that several insurance companies must pay the state up to $60 million to clean up an industrial waste storage site. In a unanimous decision California's high court declared that consecutive state-purchased policies of various insurance companies require that each company pay up to its damage cap for toxic waste spillage at the Stringfellow Acid Pits in Riverside County. The insurance companies argued that they should only be liable for the share of damages that occurred when each insurer's policy was in place. The state high court ruled that the insurance companies' argument was flawed because it was not possible to calculate the exact damages under each policy period:

Neither the State nor the insurers dispute that progressive damage to property at the Stringfellow site "occurred" during numerous policy periods. In addition, the insurers concede that in cases such as this it is impossible to prove precisely what property damage occurred during any specific policy period. The fact that all policies were covering the risk at some point during the property loss is enough to trigger the insurers' indemnity obligation.
Stringfellow Acid Pits waste site was an industrial waste disposal facility that the state designed and operated from 1956 to 1972. California has estimated that cleaning up Stringfellow will cost several hundred million dollars.

Environmental cleanups have been a contentious legal issue both in the US and abroad recently. Last week the UN welcomed a new project [JURIST report] initiated by the government of Nigeria to resolve the oil contamination affecting the people of Ogoniland. Earlier this month a court in Brazil ordered Chevron to suspend all oil drilling in Brazil [JURIST report] in the wake of two recent oil spills off the coast of Rio De Janeiro. In April a Brazilian prosecutor filed another lawsuit against Chevron [JURIST report] relating to a leak in one of its coastal oil fields. In March 35 Nigerian villages filed suit [JURIST report] against Shell [corporate website] in a London court alleging Shell's slow response in cleaning up two oil spills in a neighboring river ruined their livelihoods. A similar suit was filed in November of last year by a Nigerian village against Royal Dutch Shell PLC in the US District Court in the Eastern District of Michigan [official website].

 

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