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ARTICLE ID 50314

FINDING IN BINDING ARBITRATION Arbitrator holds that contaminants at condo complex are intermingled and that plaintiff insurance company could not establish that tanks leaking from portion of property insured by defendant insurance company caused all the damage to property insured by plaintiff insurance company that was situated "downstream".

Camden County

This action involved contamination due to leaking underground oil tanks situated at a condo complex. The plaintiff insurance company contended that all the contamination on its insured’s property came from defendant’s insured’s property and that any contamination from its own insured’s tank was negligible. Defendant, while conceding that some contamination probably came from its insured’s tank, contended that plaintiff’s tank was also a significant source and in fact had cross contaminated the defendant’s property. The plaintiff demanded full reimbursement of its over $________ in clean up costs. The case was initially brought in Camden County and the parties agreed to submit the case to binding arbitration.

The plaintiff maintained that its property was in such a location that it was likely that it was contaminated by the tanks on the defendant’s property. The defendant insurance company maintained that, irrespective of the plaintiff’s position, it was likely that the contaminants from all of the tanks would cause a trail or plume that were intermingled and that it was impossible to determine the extent to which each company caused damage to the other. The defendant’s position was that each company should bear the costs of cleaning up its own insured’s property.

The arbitrator agreed with defendant, that plaintiff’s insured’s tank was contributing to the contamination. He ruled that because it was impossible to delineate the cross-contamination, each party should bear the costs of 50% of the other’s clean up costs.

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