Can a policyholder that knowingly purchases contaminated property be covered for the costs of cleaning up that property under policies of insurance issued before the purchase? Yes, according to a new unpublished decision from the Washington Court of Appeals.
In 1999, the Port of Longview purchased property that had been used from the 1950s through 1982 to treat wood products with creosote and other chemicals. Groundwater contamination had been discovered at the site as early as 1981. The Port knew of the groundwater contamination at the time of purchase, and knew that its acquisition of the site would automatically make the Port liable under the Washington Model Toxics Control Act (“MTCA”) for the contamination there. In 2005, the Washington Department of Ecology (“DOE”) formally notified the Port that it was a potentially liable party (“PRP”) under MTCA for the cleanup of contamination at the site. Continue Reading