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Olin Corp. v. Certain Underwriters at Lloyd's London

ELR Citation: 36 ELR 20227
Nos. No. 05-5123, (2d Cir., 11/07/2006)

The court vacated and remanded a lower court decision ordering an insurance company to indemnify a chemical manufacturer for liability incurred as a result of environmental contamination at four sites near Niagara Falls. The district court allocated the costs of remediation equally over the years in which a jury found that the property damage occurred, resulting in liability being attributed to the insurance company's excess insurance policies in each of those years. But the costs of remediation should have been allocated according to the amount of property damage that occurred in each policy period, rather than equally over the years. In addition, by not allowing the jury to consider as property damage the passive migration or spread of contaminants, the district court's instructions to the jury were erroneous. On remand, the lower court must either reconsider the insurance company's motion for judgment as a matter of law or conduct a new trial. If the latter, the insurance company should be permitted to raise the defense of late notice.