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NL INDUS. v. COMMER. UNION INS. CO.

July 18, 1996

NL INDUSTRIES, INC., Plaintiff,
v.
COMMERCIAL UNION INSURANCE COMPANY, Defendants. COMMERCIAL UNION INSURANCE COMPANY, Third-Party Plaintiff, v. CERTAIN UNDERWRITERS AT LLOYD'S INSURANCE COMPANY OF NORTH AMERICA, and NORTHBROOK EXCESS AND SURPLUS INSURANCE COMPANY, Third-Party Defendants. NL INDUSTRIES, INC., Plaintiff, v. CERTAIN UNDERWRITERS AT LLOYD'S, INSURANCE COMPANY OF NORTH AMERICA, and NORTHBROOK EXCESS AND SURPLUS INSURANCE COMPANY, Third-Party Defendants.



The opinion of the court was delivered by: WALLS

 WALLS, District Judge

 This matter comes before the Court on the motions for reconsideration of this Court's May 6, 1996 Opinion and Order ("Opinion") brought by plaintiff NL Industries, Inc. ("NL"), defendant Commercial Union Insurance Company ("CU"), and third-party defendants Certain Underwriters at Lloyd's ("Lloyd's").

 BACKGROUND

 The Court will not repeat the facts and procedural history of this dispute which were set out at length in the May 6, 1996 Opinion. In that Opinion, the Court ruled on all of the various summary judgment motions concerning CU's duty to defend NL with regard to the new lead paint suits, and the obligations of Lloyd's, NL and third-party defendant Insurance Company of North America ("INA") to contribute to defense costs arising from the original lead paint suits. The Court granted NL's motion for summary judgment against CU for defense costs relating to the four new actions; denied CU's motion for summary judgment against INA for defense costs arising from Santiago, but granted it with respect to defense costs arising from HANO and City of New York ; granted CU's motion for summary judgment against NL for contribution after March 1, 1992 arising from the three original lead paint claims; and granted and denied CU's motion for summary judgment against Lloyd's, and Lloyd's cross-motion for summary judgement, to the extent that Lloyd's was obligated to contribute to the defense of the HANO and City of New York actions under the Lloyd's policies from 1958 to 1966.

 NL, CU and Lloyd's have now moved for reconsideration of two aspects of that Opinion: (1) factual and legal conclusions concerning the Lloyd's policies, and (2) the Court's legal conclusion that NL must contribute to its own defense costs for periods in which it was self-insured.

 DISCUSSION

 STANDARD

 Rule 59(e) of the Federal Rules of Civil Procedure permits litigants to move to alter or amend a judgment within ten days of its entry. Similarly, Local Rule 12(I) permits a party to seek reconsideration by the Court of matters "which [it] believes the Court has overlooked" when it ruled on a motion. The Third Circuit has held that the "purpose of a motion for reconsideration is to correct manifest errors of law or fact or to present newly discovered evidence." Harsco Corp. v. Zlotnicki, 779 F.2d 906, 909 (3d Cir. 1985). Reconsideration motions, however, may not be used to relitigate old matters, or to raise arguments or present evidence that could have been raised prior to the entry of judgment. Wright, Miller & Kane, Federal Practice and Procedure: Civil 2d § 2810.1. Accordingly, such motions will be granted only where (1) an intervening change in the law has occurred, (2) new evidence not previously available has emerged, or (3) the need to correct a clear error of law or prevent a manifest injustice arises. North River Ins. Co. v. Cigna Reinsurance Co., 52 F.3d 1194, 1218 (3d Cir. 1995). Because reconsideration of a judgment after its entry is an extraordinary remedy, requests pursuant to these rules are to be granted "sparingly." Maldonado v. Lucca, 636 F. Supp. 621, 630 (D.N.J. 1986); Wright, Miller & Kane, at § 2810.1.

 I. The Lloyd's Policies

 The Court previously found that, as to HANO and City of New York, the Lloyd's policies running from November 1, 1949 to May 1, 1958 were not triggered because they did not cover property damage arising from products liability claims; that the policies extending coverage from February 1, 1966 to February 1, 1970 overlapped with policies issued by CU and thus no duty to defend arose therefrom; but, that from May 1, 1958 to February 1, 1966 Lloyd's, as NL's sole insurer, extended coverage to property damage claims arising from products liability and thus was required to defend for claims arising from this period. NL and CU contend that the Court made factual errors when it found that the Lloyd's 1949 to 1958 policies do not cover products liability claims, and when it found that the 1966 to 1970 policies overlapped with CU's policies. And that when these errors are corrected, Lloyd's is required to contribute to NL's defense of HANO and City of New York for the entire time that it provided insurance to NL. Lloyd's maintains that the Court arrived at an incorrect legal conclusion when it held that it had any duty at all to defend NL.

 a. The 1949 to 1958 Policies

 The Court concludes that there is no basis for reconsidering the factual determination that Lloyd's 1949 to 1958 policies do not extend coverage to product liability claims. CU and NL, for the first time, argue that the 1949 to 1958 policies are essentially identical to the 1958 to 1970 policies which indisputably cover product liability claims, and therefore, that the former policies must extend similar coverage. In addition, CU and NL contend that Lloyd's improperly relied upon parol evidence to interpret the 1949 to 1958 policies to support its position that products liability claims were excepted from coverage, and that a plain reading of the unambiguous terms of the policies mandates the opposite conclusion.

 These arguments, however, are unavailing for several reasons. First, motions for reconsideration are an inappropriate avenue for relitigating matters which could have been adequately presented the first time. And here, both CU and NL had an opportunity to contest Lloyd's interpretation of its policies, but did not. Secondly, there is no merit to the arguments proffered by CU -- that Lloyd's interpretation of the 1949 to 1958 policies is nonsensical because the 1958 to 1970 policies are identical and indisputably cover product liability claims, and that parol evidence may not be used to interpret the policies. Original copies of the Lloyd's policies could not be located, and thus NL and Lloyd's entered into a stipulation as to the terms and conditions of the missing contracts, based upon originals or copies of placing slips. While it is true that the reconstructed 1949 to 1958 policies are, on their face, almost identical to the 1958 to 1970 policies, the stipulation states:

 
5. The issue which is expressly not addressed by this stipulation is whether NL was afforded property damage coverage for product liability claims for the policy periods prior to May 1, 1958. It is stipulated that the issue of whether property damage product liability claims are covered by pre-May 1, 1958 policies issued by the London Insurers is specifically to be left unresolved. In this connection, certain excess policy exhibits, which are appended hereto, contain a product hazard exclusion around which the parties for purposes of this stipulation have placed brackets. There is a dispute between the parties whether or not this clause appeared in the originals of those policies.
 
6. Should the issue of pre-May 1958 products liability coverage be raised in further proceedings, it is agreed that this stipulation is not intended to preclude any party from offering additional ...

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