Nebraska Court: Insurers Must Pay in Pollution Case

The Nebraska Supreme Court on Feb. 5 upheld a decision ordering two insurance companies to pay about $550,000 of the cost of cleaning up industrial contamination in Hastings. The ruling sets the standard in Nebraska for determining how much insurance companies are responsible for when they insure a company for only part of the time that the contamination occurred.

The Court said The Continental Insurance Co. and Northern Insurance Co. of New York should pay, but it agreed with a lower court’s ruling that the insurers should only be held responsible for part of the damages. Both companies insured Dutton-Lainson Co. during part of the four decades that it contributed to groundwater pollution in Hastings.

Continental was ordered to pay more than $475,000. Northern must pay almost $75,000.

The court refused Dutton-Lainson’s appeal seeking $4.9 million from the insurance companies to cover damages and the cost of defending itself.

Dutton-Lainson was one of several companies that settled with the Environmental Protection Agency over groundwater contamination. The maker of tools and trailer parts took some chemicals and byproducts of its manufacturing operation to city landfills because the law required it at the time.