Georgia Supreme Court Decision Regarding Pollution Exclusion in Insurance Policy

On March 21, 2016, the Georgia Supreme Court issued a decision in Georgia Farm Bureau Mutual Insurance Company v. Smith, which involved a declaratory judgment action by an insurer that it had no duty to defend or provide coverage to a landlord against a tenant’s lawsuit alleging that her daughter suffered brain damage as a result of ingesting lead from deteriorating lead-based paint in a rental property.  In reversing a Georgia Court of Appeals decision, the Georgia Supreme Court held that a personal injury claim arising from lead poisoning was excluded from coverage under an “absolute pollution exclusion” in a commercial general liability policy covering residential rental property. Although lead was not expressly included in the policy’s definition of “pollutant,” the Georgia Supreme Court concluded that lead was a “contaminant” within the definition of pollutant and the Court rejected the claimant’s argument that the policy’s pollution exclusion was limited to traditional environmental/industrial pollution and did not apply to claims relating to the presence of leaded materials in a private residence.  The Georgia Supreme Court based its holding on prior Georgia decisions holding that pollution exclusions applied to toxic tort claims and the Court rejected contrary case law from other states.

For more information about insurance coverage issues or toxic tort litigation, please contact Andy Thompson.  For a copy of the Georgia Supreme Court decision, click Georgia Farm Bureau Mutual Insurance Company versus Smith.


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