The owner-operator of an "internet cafe" has had a $50,000 loss of computer equipment that is said to have occurred when a tenant in an adjoining space was having some remodeling-rehabbing work done. A lot of fine dust was raised by the carpentry and dry wall work, and with no one realizing it the dust settled into the electrical connections in the partition walls separating the two tenants. The dust is said to have damaged or destroyed the aforesaid computer equipment.

Coverage for the insured is under commercial property form CP 10 30 06 95. What is the effect of exclusion 2. l. which eliminates coverage for loss or damage caused by or resulting from "discharge, dispersal, seepage, migration, release or escape of 'pollutants'"?

Georgia Subscriber

Disastrous, for the insured hoping for insurance recovery. Far different from the effect of "special form" coverage of the past — in which the emphasis was on coverage of risks of loss as opposed to (and excluding) non-risk occurrences such as wear and tear, rot, and contamination — is the effect of the current contract. The risk of damage by the sudden introduction of foreign elements into a piece of machinery is every bit (as here) as much a risk as is the risk of fire damage to the same machinery. But the "pollution exclusion" is so broadly worded that there is no escaping it.

"Pollutant" is undefined in the causes of loss form. Rather, the term is defined in the building and personal property coverage form CP 10 30 06 05. It means "any solid, liquid, gaseous, or thermal irritant or contaminant including…(a variety of polluting elements which, while not specifically mentioning construction dust, manages to cover the field with "any solid…irritant or contaminant").

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