COA orders summary judgment for insurance company after postal worker’s death

The Indiana Court of Appeals has ordered the entry of summary judgment for an insurance company after finding that although the airbrushing business the company insures made multiple mistakes that led to the death of a postal worker, those mistakes resulted in only one accident.

While working at a United States Postal Service processing facility, Theodore Long was exposed to a hazardous substance shipped by airbrushing business The Art of Design when a box containing ten bottles of a toxic chemical broke open and the bottles spilled, leaking onto a conveyor belt and releasing toxic fumes. As he worked to clean up the spill, Long observed that the box was not labeled as containing hazardous materials and had been sealed only by a piece of masking tape. It was later determined that The Art of Design had violated Postal Service regulations relating to both the labeling and packaging of hazardous materials.

During the clean-up process, Long was overcome by the fumes and later went to the hospital. Long’s estate claimed he was permanently disabled because of injuries sustained when he was exposed to the chemical fumes and that exposure was the direct and proximate cause of his death in June 2016.

In June 2017, Long’s estate filed a declaratory judgment action seeking a determination of the applicable limits of The Art of Design’s commercial general liability insurance policy provided in a policy issued by Auto-Owners Insurance Company. The parties filed competing motions for summary judgment, with Auto-Owners arguing the applicable policy limits were $1 million and the estate arguing they were $2 million. The Elkhart Superior Court granted summary judgment in favor of the estate, finding the $2 million policy limits applied.

Auto-Owners appealed the trial court’s decision, which the appellate court ultimately reversed in Auto-Owners Insurance Company v. William Long, as Administrator of the Estate of Theodore Long, and Ellen Long, Individually; Dean Loucks and The Art of Design, 18A-CT-852.

Specifically, Auto-Owners argued on appeal that the trial court erred in finding there were two occurrences under the terms of the policy. The parties agreed that if there was only one occurrence, the $1 million limit would apply, and if there were two occurrences, the $2 million limit would apply.

“While the Insured failed to both properly label and package the box, there was only one accident that resulted from the Insured’s failure to take appropriate preventative measures to avoid a spill,” Judge Cale Bradford wrote for the court. “Stated differently, although the Insured did two things wrong in shipping the package, the wrongdoing resulted in one spill, i.e., ‘one proximate, uninterrupted, and continuing cause which resulted in’ Long’s injury.

The appellate court, therefore, concluded there was only one occurrence under the terms of the policy and remanded with instructions for the trial court to enter summary judgment in favor of Auto-Owners.