Ala. Judge Says Drywall Losses Clearly Caused by 'Pollutant,' Refuses to Apply Exclusion

MOBILE, Ala. - A judge in Alabama has refused to relieve an insurer of its obligation to defend builder The Mitchell Company against two Chinese drywall complaints, saying he is not convinced that coverage for the claims is barred by the pollution exclusion. Scottsdale Insurance Co. v. American Safety Indemnity Co., et al., No. 10-445 (S.D. Ala.).

Judge William H. Steele of the U.S. District Court for the Southern District of Alabama said in his Nov. 10 order that while the underlying claims against the builder clearly involve pollutants, the applicable exclusion requires that the pollution occur when the insured …