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Milwaukee Metro. Sewerage Dist. v. American Int'l Specialty Ins. Co.

Citation: 40 ELR 20077
No. Nos. 09-1645 et al., (7th Cir., 03/10/2010)

Applying state law, the Seventh Circuit reversed a lower court decision to hold that a sewerage district was not entitled to reformation of an environmental liability insurance policy to include a certain parcel of real property. Based on all of the evidence in the record, the lower court’s finding that there was clear and convincing proof that a prior agreement existed between the insurer and the district that the parcel would be covered property was clearly erroneous. There was no meeting of the minds regarding the actual property that the district wished to insure. This is fatal to a reformation claim. In addition, viewed as a whole, the record indicates that the district, through its agent, knew that the policy would not include the parcel of land as an insured property. Absent a mistake on the part of the district at the time the policy was issued, reformation is not an available remedy.