On appeal from Superior Court, Law Division, Essex County.
Pressler, Long and Landau. The opinion of the court was delivered by Landau, J.A.D.
Appellants Leonard and Esther Gottlieb (Gottliebs) are homeowners who sued defendant Apex Pest Control, Inc. (Apex) in a separate action to recover for damages suffered by reason of the application of toxic chemicals, chlordane and heptachlor, to the exterior, basement tool room, and crawl space of their home in May 1982. Their home was tested on April 28, 1983 by Princeton Testing Labs and presence of those chemicals was found in a map room, upstairs bedroom, study and an air duct in the music room. None of those rooms had been treated.
In February 1985, another test was performed, disclosing that the chemicals had migrated further, into the living room
and master bedroom. The house was decontaminated in December 1985.
Apex was insured for property damage and liability risk by defendant-respondent Newark Insurance Company, a subsidiary of Royal Insurance Company (collectively "Newark") under annual "Select-Cover" policies which contained comprehensive general liability coverage beginning January 3, 1982. The property damage liability limits were $25,000 in 1982, $50,000 in 1983, and $1,000,000 in 1984 and 1985. Although the Gottliebs received an offer to settle their claim for the full amount of the 1982 policy which Newark says is applicable, they brought this declaratory action seeking a determination that as a matter of law coverage for their damage was also afforded under the later policies.*fn1
The trial judge initially accepted this view, denying Newark's motion for summary judgment and granting summary judgment on the Gottliebs' cross-motion. We granted leave to appeal. Following a motion to supplement the record with a copy of the actual insurance policy, we ordered a limited remand to permit such supplementation and an opportunity for the trial judge to consider the effect of the definition of "occurrence" contained in the text of the policy which was not theretofore of record. After hearing oral arguments, the trial judge entered an order which vacated the original order of judgment and granted summary judgment to Newark, holding that the policy unambiguously defined occurrence to include all damages which commenced in 1982, irrespective of the subsequent dates of injury.*fn2
From this summary judgment, the Gottliebs appealed.*fn3 Their substantive position is that under Apex's policies, which are "occurrence" rather than "claims made" forms, the migration of contamination to untreated areas of their house which was discovered in two subsequent tests constituted separate and additional triggering events for coverage under policies in effect at the time of each discovery. Newark says that the time of application of the pesticides and the initial discovery of contamination in the Gottlieb house, both of which occurred in 1982, should constitute the only "occurrence" under the policy, regardless of when additional rooms or areas were found to be contaminated by migration of the chemicals. Each party relies on policy definitions contained in the 1982 policy which is now of record, and cites authority purporting to sustain its respective position, picking and choosing cases from among a bewildering plethora of authority which has developed in recent years, particularly as the result of the increasing number of toxic tort cases in which injuries do not manifest themselves until long after the wrongful acts, occasionally appearing unpredictably over the period of several insurance policies.
The trial judge and the parties assumed that this complex issue could be resolved by summary judgment on the limited undisputed facts of record. We disagree and reverse.*fn4
In granting summary judgment to Newark, the trial judge held that there was no factual dispute and that declaratory judgment could be granted as a matter of law because there had been an initial application of the chemical substance with
the "same structure suffering continuous exposure to it . . ." The policy provides that, "[o]ccurrence means an accident, including continuous or repeated exposure to conditions, which results in bodily injury or property damage neither expected nor intended from the standpoint of the insured." It also provides that, "[f]or the purpose of determining the limit of the company's liability, all bodily injury and property damage arising out of continuous or repeated exposure to substantially the same general conditions shall be considered as arising out of one occurrence." The term "property damage" is defined to mean, "(1) physical injury to or destruction of tangible property which occurs during the policy period. . . ." (Emphasis added).
The principal basis for the Gottliebs' claim that coverage under Apex's post 1982 policies should also be provided is the theory that the migration uncovered in 1983 and 1985 constituted injuries suffered in later policy periods and thus coverage under those later policies was triggered. They urge that we adopt the so-called continuous trigger theory often applied in toxic tort cases where injuries continue to surface long after the tortious act itself.
This theory, notably expounded in Keene Corp. v. Ins. Co. of North America, 215 U.S.App.D.C. 156, 667 F.2d 1034 (1981), cert. den., 455 U.S. 1007, 102 S. Ct. 1644, 71 L. Ed. 2d 875 (1982), reh'g den., 456 U.S. 951, 102 S. Ct. 2023, 72 L. Ed. 2d 476 (1982), holds that where an injury process is not a definite, discrete event, the date of the occurrence should be the continuous period from exposure to manifestation of damage. The subject has been discussed in a Harvard Law Review Note, "Developments in the Law -- Toxic Waste Litigation," 99 Harv.L.Rev. 1458, 1578-82. The note suggests that the continuous trigger theory, and indeed other theories respecting occurrence, typically arise out of efforts to maximize insurance coverage by use of the ambiguity approach.
It has been indisputably determined in New Jersey that the time of the occurrence of an accident is not the time when the wrongful act was committed, but the time when the complaining party was damaged. See Hartford Acc. & Indem. Co. v. Aetna Life & Cas. Ins. Co., 98 N.J. 18, 483 A.2d 402 (1984). In cases where there has been continuing damage, however, as typified in toxic tort contamination cases involving the migration of toxic chemicals, it begs the question merely to say that "the time of the 'occurrence' . . . is not the time the wrongful act was committed, but the time when the complaining party was actually damaged." Id. at 27, 483 A.2d 402.
Contrary to Newark's argument, this issue has not been resolved by our opinion in Doria v. Ins. Co. of North America, 210 N.J. Super. 67, 509 A.2d 220 (App.Div.1986). In Doria, where one child was drowned in a swimming pool accident and a second drowned while attempting to rescue the first, the court found that there was but a single occurrence, particularly as both the tortious event and the injuries were concentrated within the same immediate period. Neither does the language of the policies, as held by the trial judge, clearly resolve the occurrence question. As interpreted in Hartford, the time of injury determines the existence of an occurrence. However, as in Hartford and Doria, the injury must occur during the policy period, because the latter phrase is incorporated in the definition of "property damage" in the Gottliebs' policy. In Hartford and in Muller Fuel Oil Co. v. Ins. Co. of North America, 95 N.J. Super. 564, 232 A.2d 168 (1967) the "when" of an occurrence was set down as the time when the effects of the tortious actions are felt. And, as we pointed out, the Apex policy requires that property damage, i.e. physical injury to tangible property, must occur during the policy period. Thus, under the continuous trigger theory, the question here would be whether there were injuries suffered during 1983 and 1985, as well as in 1982.
We recognize that the Keene multiple or continuous trigger theory is not uniformly accepted and ...