Case Notes

The Supreme Court of Pennsylvania, applying Pennsylvania law, has held that coverage was triggered under the “first manifestation” rule when injury caused by a policyholder's negligence became “reasonably apparent” even where the cause of the injury was not discovered until a later policy period. Pennsylvania National Mutual Casualty Insurance Company v. John D. St. John, No. 86 MAP 2012 (Pa. Dec. 15, 2014). In reaching that result, the court also declined to apply a “multiple trigger” theory to continuous, progressive property damage, finding that the rule applied only in the context of asbestos bodily injury claims.

The policyholder, a plumbing company, was sued by co-owners of a dairy farm for negligent installation of a plumbing system that allegedly caused various health and reproductive problems with the claimants' dairy herd, arising from contamination to the cattle's water supply. The policyholder held four CGL policies that provided coverage for three successive years, the last of which included a CGL policy and umbrella policy. Following a jury award in favor of the claimants, the parties settled their claims for the limit of liability of one of the policies. Under the settlement agreement, the claimants retained the right to pursue the remainder of the judgment against the insurer under the policies.