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Port Authority of New York and New Jersey v. Affiliated FM Insurance Company
United States Court of Appeals for the Third Circuit
311 F.3d 226 (2002)
Port Authority of New York and New Jersey and Port Authority of Trans-Hudson Corporation (plaintiffs) own facilities throughout New York and New Jersey. These facilities contained asbestos. The plaintiffs sought to recover for the expenses they incurred when they removed asbestos from their facilities, because, they claimed, the asbestos damaged the facilities. At no point did asbestos levels in the plaintiffs’ properties exceed Environmental Protection Agency standards. Although over 1,000 structures owned by the plaintiffs contained asbestos, the plaintiffs only asserted claims for 69 abatement projects, which were only carried out in 13 instances. The plaintiffs had first-party insurance policies with Affiliated FM Insurance Company and other property insurers (defendants) insuring against all risks of physical loss or damage occurring during the periods covered by the policies, which were from 1971 to 1991. The plaintiffs claimed that the existence of asbestos in their facilities triggered loss under those policies. The plaintiffs brought a state-court action against the defendants to recover the cost of asbestos abatement. The case was removed to the United States District Court for the District of New Jersey. The district court determined that physical loss or damage could only be found if there was an imminent threat of asbestos release or an actual release of asbestos resulting in contamination to the property. Presence of asbestos was not enough. The defendants moved for summary judgment. The district court granted summary judgment in favor of the defendants, holding that, although the plaintiffs claimed losses arising from asbestos, there was no indication that there was an increased asbestos level. The plaintiffs appealed.
Rule of Law
Holding and Reasoning (Weis, J.)
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