Court Requires Nexus Between Invasion of Private Property and Alleged Damages to Trigger Coverage Under “Wrongful Entry” Provision in Policy

John Sexton Sand & Gravel Corp. v. National Union Fire Insurance Co. (N.D. Ill., December 11, 2015)

In a declaratory judgment action for defense costs and indemnity, the court granted the insurer’s motion for judgment on the pleadings and found there was no coverage for underlying actions against the policyholder seeking contribution for remediation costs attributable to hazardous substances from a landfill. Specifically, the court found that allegations in the underlying complaints did not trigger coverage under the “wrongful entry” provision of the policy, because the complaints failed to allege a nexus between the invasion of private property by contaminants and the remediation costs incurred by the underlying plaintiff. Additionally, the court held that the policy did not provide coverage for a breach of contract claim against the policyholder due to a contractual liability exclusion, which was clear and enforceable.