land on numerous occasions, thereby causing the ASR to accumulate, does not make the injury progressive in cause. Nor is the injury progressive in cause because more and more ASR accumulated over time. All these facts demonstrate is that PSN's conduct is accurately described as a series of instances of allegedly unintentional behavior, some of which may have occurred during the periods of the Hartford policies.
In considering the requirement that the injury be indivisible, I conclude that the injury caused by PSN's placement of ASR onto Conrail's land was not indivisible in the sense described by Owens-Illinois. By indivisible, the New Jersey Supreme Court meant that the injuries which are embraced by the continuous trigger theory cannot be easily allocated to any particular time period, or insurance policy, because the cause of the injury cannot be isolated with any degree of mathematical or scientific nicety. See Owens-Illinois, 138 N.J. at 474-75. By indivisible, the New Jersey Supreme Court meant that the specific cause of a continuous harm could not be parceled out with any scientific accuracy such that it could be said, for example, that a certain percent of the ultimate injury was caused during the first year of exposure. For this reason, the Owens-Illinois court opted for the second-best solution of prorating the time on the risk of each insurer and the degree of risk assumed under a particular insurance contract. Id. at 475-76.
Here, it is quite obvious that the cause of the harm -- the harm being the encroachment onto Conrail's land -- can, as an objective matter, be divided up over time. For example, if PSN could prove that one-half of the ASR ultimately removed from Conrail's land was deposited during the periods of the Hartford policies, then Hartford would be responsible for that portion of PSN's damages.
In short, PSN's apparent choice not to insure itself for the period after October 1, 1975, is no reason to "shoehorn" this case into the continuous trigger theory mold just to provide coverage for an otherwise uninsured or self-insured injury. See, e.g., Owens-Illinois, 138 N.J. at 451-52 (presumption of maximizing coverage as an end in and of itself is "an uneven principle" resembling "judicial legislation"); Uniroyal, Inc. v. Home Ins. Co., 707 F. Supp. 1368, 1392 (E.D.N.Y. 1988) (discussing effect of failure to insure on allocation among insurers and insured). PSN could not have reasonably believed that simply having committed the first in a long series of allegedly unintentional acts while Hartford was "on the risk" would entitle it to insurance forever. While the continuous trigger theory remains useful and, indeed, quite powerful, it should not be applied where it is inappropriate to do so. See Owens-Illinois, 138 N.J. at 456 (noting that continuous trigger theory was applicable in asbestos case where "no one suggested that the process was anything but continuous"); Hartford Accident & Indem. Co. v Aetna Life & Casualty Co., 98 N.J. 18, 28-29, 483 A.2d 402 (1984) (rejecting "exposure" theory because party presented no evidence that harm was cumulative and progressive and noting that "some diseases . . . are cumulative and progressive, but others are not"); J.T. Baker, 1996 WL 451316, *10 (noting that Hartford "limits [use of the continuous trigger theory] when the evidence supporting its application is not present in the record"); cf. Koppers Co., Inc. v. Aetna Casualty & Surety Co., 98 F.3d 1440 (3d Cir. 1996) (applying Pennsylvania law and noting effect of introduction of evidence that property damage was continuous, progressive, and indivisible).
Having concluded that PSN cannot avail itself of the continuous trigger theory to show an entitlement to indemnification for all of its 1987 ASR removal costs and noting the agreement between PSN and Hartford that there was some ASR encroachment prior to April 1974, it remains to be decided whether Hartford is entitled to summary judgment on the question of whether PSN can show any connection between the 1987 ASR removal costs, i.e., ASR removed from Conrail's land in 1987, and ASR deposited onto Conrail's land prior to October 1, 1975. In support of it motion, Hartford claims that: 1) PSN's general manager, Jay Zimmern, testified that the 1987 ASR removal costs relate to ASR removed from the southern portion of Lot 18, not the three small areas of encroachment along the northern border of Lot 18; and 2) PSN cannot prove when the ASR was spread onto its property. See Hartford's Brief at 13-14; Hartford's Reply Brief at 7-8.
In response to Hartford's first argument, PSN argues that Zimmern only indicated generally the areas from which ASR was removed. PSN's Memorandum of Law at 8. This does nothing to satisfy PSN's burden to respond to a properly supported motion for summary judgment; that Zimmern was only estimating which pockets of ASR were removed in 1987 does not show that PSN could prove any connection between 1987 removal costs, i.e., ASR removed from Conrail's land in 1987, and pre-termination encroachment, i.e., an "occurrence" or offense or wrongful entry of eviction which took place during a policy period.
In response to Hartford's second point, PSN's response is non-existent: it has not adduced a "scintilla" of evidence to show a connection between its 1987 removal costs and the ASR which existed on Conrail's property prior to October 1, 1975. What PSN seems to have done instead is to cull from Hartford's Statement of Undisputed Facts (dated Sept. 15, 1997) in an attempt to dredge up any factual dispute and, hopefully, thereby survive summary judgment. However, the factual disputes which PSN hopes to reserve for trial are immaterial to the question of whether it can meet its burden of proof demonstrating a connection between removal costs, i.e., ASR removed in 1987, and encroachment prior to termination of the final insurance contract with Hartford. On that score, PSN registers nothing. Summary judgment for Hartford on the question of whether PSN's removal expenses relate to an "occurrence" or offense of "wrongful entry or eviction" which took place during one of the Hartford policy periods is therefore appropriate.
B. Nature of Alleged Damages to PSN
Hartford's secondary contentions, joined, once again, by the London Insurers, relate to the nature of the "damages" allegedly sustained by PSN in removing what ASR from Lot 18 which they did clean up, and in purchasing Lot 18 from Conrail.
First, Hartford separates the costs PSN sustained in cleaning up approximately 57,000 tons of ASR into: 1) the costs to remove the 57,000 tons from Lot 18; and 2) the costs of re-disposing of the 57,000 removed tons into a landfill. Hartford argues that PSN was only legally obligated as a result of Conrail's threat of legal action to remove the 57,000 tons of ASR from Lot 18, but not legally obligated to re-dispose of the ASR. Hartford characterizes the costs to re-dispose of the 57,000 tons of ASR as "business expenses." Therefore, Hartford argues, at most PSN can claim that it should be indemnified for only the removal costs, $ 1,881,025.80-$ 1,796,412, or $ 84,607.40. See Zimmerman Certif., Exh. Y.
Second, Hartford argues that PSN voluntarily assumed responsibility in removing ASR from Lot 18. This, Hartford claims violated one of the clauses of the insurance contract which provides that PSN:
shall not, except at his own cost, voluntarily make any payment, assume any obligation or incur any expense other than for first aid to others at the time of accident.
See, e.g., Zimmerman Certif., Exh. Z5 at § 4(c). In light of my finding that summary judgment is appropriate as to PSN's 1987 removal costs, I need not address Hartford's arguments.
Finally, Hartford argues that the purchase price of Lot 18, $ 1.5 or $ 1.6 million, cannot be considered damages under the Hartford policies because PSN has not sustained any meaningful loss in purchasing the property. Not only did PSN receive a piece of property allegedly worth what it paid, but also PSN has received a large unrealized gain on the property, in the form of the property's appreciation, and because owning both Lots 7 and 18 enhances the value of the two. Furthermore, PSN has realized an additional gain of over $ 500,000 as a result of its purchase of the property because, contemporaneously with its purchase of Lot 18 from Conrail, a third-party paid PSN for an easement across PSN's land, including Lot 18.
In support of the argument that purchase of the property did not result in any losses to PSN, Hartford had Lot 18 appraised. See Zimmerman Certif., Exh. W. The appraisal's estimate of the market value of Lot 18, as of December 21, 1992, the date on which PSN was deeded the land, is $ 1,586,000. Id. at 3. The appraisal's estimate of Lot 18's market value as of March 12, 1997 is $ 2,221,000. Id. at 3, 23-25 (noting effect of ASR on value of property).
PSN has not rebutted these estimates or suggested their inaccuracy. Nor has PSN suggested that it did not actually receive, at the same time that it purchased Lot 18, approximately $ 500,000 in exchange for an easement across, inter alia, Lot 18.
The amounts paid to Conrail by PSN were not paid as damages within the meaning of any of the Hartford or Lloyd's polices. This is true just as much for Hartford's 1970 to 1973 policies wherein damages with respect to property damage coverage are defined to "include . . damages for loss of use of property resulting from property damage," Joint Final Pretrial Order at 9, as it is true for the Hartford policies which define "damages" with respect to personal injury liability coverage as "only those damages which are payable because of personal injury arising out of an offense to which this insurance applies." Zimmerman Certif., Exh. Z3. Similarly this is true for Hartford's 1973 through 1975 policies and the Lloyd's policies. To compensate PSN for the $ 1.5 or $ 1.6 million paid to Conrail, when it appears that what PSN received in exchange was worth approximately that amount, and has turned out to be a prudent investment (i.e., the land has appreciated in value, as a direct and not fortuitous result of the purchase, resulted in additional revenue of approximately $ 500,000 and eventually enhanced the value of the combined Lot 18 and Lot 7 parcel by $ 325,000),
would result in a windfall for PSN. It cannot have its cake and, turning to its insurers, eat it too. Summary judgment in favor of Hartford and the London Insurers on PSN's claim that the amount spent to purchase Lot 18 is therefore appropriate.
C. Further Arguments of the London Insurers
The London Insurers, in addition to joining Hartford's arguments, make two further arguments. First, the London Insurers claim that PSN failed to provide notice within a reasonable period of time, as provided for by the Lloyd's Policies, and that the London Insurers suffered "appreciable prejudice" as a result of PSN's delay in providing notice. The Lloyd's Policies provide that:
Whenever the Assured has information from which the Assured may reasonably conclude that an occurrence covered hereunder involved injuries or damages which, in the event that the Assured should be held liable, is likely to involve this policy, notice shall be sent as stated [elsewhere in this policy] as soon as practicable, provided, however, that failure to give notice of any occurrence which at the time of its happening did not appear to involve this policy but which, at a later date, would appear to give rise to claims hereunder, shall not prejudice such claims.