United States District Court, D. Montana, Great Falls Division
Morris United States District Court Judge
Court held a hearing on August 29, 2019, on several motions
in this declaratory judgment action brought by Endurance
American Specialty Insurance Company
(“Endurance”) against defendants Duel Trucking
and Transport, LLC (“DTT”), formerly known
as Capital Transportation Logistics, LLC
(“Capital”), and Dual Trucking, Inc.
(“DTI”) (collectively, “Defendants”).
(Docs. 71 & 150.)
parties informed the Court that they had resolved
Defendants' Motion to Quash Deposition Subpoenas (Doc.
123) and that the issue is moot. (Doc. 150.) The Court denied
Defendants' Motion for Judgment on the Pleadings (Doc.
113) without prejudice and deferred ruling on Endurance's
Motion for Summary Judgment Regarding the Endurance Policy
Issued to Capital (Doc. 129). (Doc. 150.) This Order
addresses Endurance's Motion for Summary Judgment
Regarding the Endurance Policy Issued to DTI (Doc. 134).
AND PROCEDURAL BACKGROUND
are involved in two underlying Montana state court
proceedings in the Fifteenth Judicial District Court,
Roosevelt County. (Doc. 71 at 2.) The state court proceedings
arise out of claims for contamination and property damage.
Defendants allegedly contaminated property leased from Wagner
and Garth Harmon (“the Harmons”) by storing,
treating, and disposing of wastes and toxic materials
generated by off-site oil and gas fracking operations. (Doc.
136 at 2.)
remains the only defendant in State of Montana Department
of Environmental Quality v. DTT, Cause No. DV-14-67,
15th Judicial District Court for Roosevelt County, MT
(“MDEQ Suit”). (Doc. 136-1.) In the
MDEQ Suit, the Montana Department of Environmental
Quality (“MDEQ”) alleges that DTT violated state
law regarding waste storage and disposal and that these
violations resulted in contamination. (Id. at 4, 8.)
DTI and DTT are both defendants, along with others, in
Garth L. Harmon and Wagner Harmon v. DTI, et al.,
No. DV-15-15, 15th Judicial District Court for Roosevelt
County, MT (“Harmon Suit”). (Doc.
136-2.) The Harmon Suit alleges various causes of
action for property damage, including claims based on breach
of contract, negligence, trespass, and nuisance.
(Id. at 23, 30, 32, 33.)
issued two contractors pollution liability policies to the
Defendants in 2011. (Docs. 137-1 & 137-2.) Defendants
tendered the MDEQ Suit and the Harmon Suit
to Endurance in June 2016. (Doc. 136 at 3.) Endurance agreed
to defend both actions pursuant to a full reservation of
issued the first policy to Capital (“Capital
Policy”) on May 23, 2011. (Doc. 137-1 at 1.) The
Capital Policy listed Capital as the named insured and set a
policy period of May 23, 2011, to May 23, 2012.
(Id.) The Capital Policy covered damages resulting
from pollution conditions first incurred during the policy
period. (Id. at 6.) Endurance canceled the Capital
Policy at Capital's request on October 1, 2011.
(Id. at 44.) This cancellation request terminated
the policy period. (Id.)
parties appear to agree that, at the time of the motions
hearing on August 29, 2019, neither the MDEQ Suit,
nor the Harmon Suit, name Capital as a defendant.
The parties also seem to agree that neither suit alleges
wrongful conduct that occurred within the Capital
Policy's policy period of May 23, 2011, to October 1,
2011. Endurance nevertheless sought a summary judgment ruling
on Endurance's obligations under the Capital Policy
because the Defendants tendered the MDEQ Suit and
the Harmon Suit to Endurance under the Capital
Policy. The Court demes it prudent to defer any ruling on
Endurance's summary judgment motion regarding the Capital
Policy until further factual developments clarify the
potential for any claims for coverage arising under the
policy. (Doc. 150.)
issued the second policy to DTI (“DTI Policy”) on
September 30, 2011. (Doc. 137-2.) The DTI Policy listed DTI
as the named insured and set a policy period of September 30,
2011, to October 1, 2012. (Id. at 1.) Similar to the
Capital Policy, the DTI Policy covered damages resulting from
pollution conditions first incurred during the policy period.
(Id. at 6.) Endurance added a named insured
endorsement to the DTI Policy, effective January 13, 2012.
(Id. at 42.) The endorsement added DTT and Dual
Trucking of Montana, LLC (DTM) as named insureds on the DTI
Policy. (Id. at 42.)
Policy covered DTI, DTT, and DTM for “property
damage” for which they became legally obligated to
pay as the result of “a pollution condition at
any site where any insured . . . is performing, or
has performed, any contracting or remediation operations
anywhere in the world . . . [if] the pollution
condition first incurred during the policy
period . . . .” (Doc. 137-2 at 6.) The policy
defined the term “pollution condition” as
[T]he discharge, dispersal, release or escape of smoke,
vapors, fumes, acids, alkalis, toxic chemicals, liquids or
gases, waste materials or other irritants,
contaminants or pollutants into or upon land, the atmosphere
or any watercourse or body of water which results in bodily
injury or property damage. A continuous, related,
repeated, or similar series of discharges, dispersals,
releases, or escapes of pollutants at or from a site shall
constitute a single pollution condition. Related
pollution conditions are those pollution