Venoco, Inc. v. Gulf Underwriters Insurance

An oil company has an insurance policy that excludes toxic pollution coverage. An exception to that exclusion applies under limited circumstances provided the oil company notifies the insurance company of a claim within 60 days of an occurrence. We conclude, among other things, this notice requirement does not violate public policy, nor is it barred by California’s so-called “notice-prejudice” rule.

Plaintiff Venoco, Inc. (Venoco), appeals a summary judgment entered in favor of defendant Gulf. Underwriters Insurance Company (Gulf). Former students and employees of Beverly Hills High School brought an action against Venoco for personal injuries allegedly caused by toxic pollution from Venoco’s oil and gas operations. Venoco sued Gulf, its insurer, seeking declaratory relief to establish Gulf’s obligation to defend these actions.

We also conclude (1) the Gulf policy excludes the tort actions and alleged false claims filed against Venoco, (2) the 60-day reporting requirement is placed conspicuously in the policy, (3) the pollution exclusion supersedes inconsistent language in another portion of the policy. We affirm.

FACTS

In 1910, oil wells were drilled on a 22-acre…