I have long been a student of whether bodily injury or property damage was caused by an “occurrence,” i.e., an accident, to satisfy one of the initial thresholds to coverage under a commercial general liability policy.  This is the oldest and most litigated of all CGL coverage issues.  The first reported “accident” coverage case that I know of goes back to 1835 -- Howell v. Cincinnati Ins. Co., from the Ohio Supreme Court.  At issue was coverage for a boat that sank.  [The “accident” issue arose in coverage disputes before the advent of liability insurance.]    

My favorite ancient “accident” case is Schneider v. The Provident Life Insurance Company (Wis. Sup. Ct. 1869).  The court addressed whether a gentlemen died by accident when, while running for a train, he slipped and fell underneath it.  Yes it was an accident, the court concluded.  The language of the decision, trying to figure it out, reads like it was written last week.  Not much progress has been made in 150 years.

The challenge of figuring out if an accident took place was best described by the Pennsylvania Supreme Court in Brenneman v. St. Paul F. & M. Ins. Co. (1963): “Everyone knows what an accident is,” the court observed, “until the word comes up in court.  Then it becomes a mysterious phenomenon, and, in order to resolve the enigma, witnesses are summoned, experts testify, lawyers argue, treatises are consulted and even when a conclave of twelve world-knowledgeable individuals agree as to whether a certain set of facts made out an accident, the question may not yet be settled and it must be reheard in an appellate court.”

That the “accident issue” has been around for so long makes sense.  There is no limit in nature to what could possibly be an accident causing injury.  So the question arises frequently and under all manner of circumstances – sometimes quite unusual and never before seen.

The Minnesota federal court’s recent decision in Campanella v. Northern Properties Group, LLC, No. 19-171 (D. Minn. Feb. 28, 2020) demonstrates this.  Not to mention being a case where the insurer could not fathom that the injury was caused by an accident.  But the court concluded that it was -- and didn’t even seem to think that its decision was particularly difficult.  This is another aspect of accident/occurrence cases -- they can be difficult to predict.  In some ways, they have an element of the judge knows what’s an accident when he or she sees it.     

Matthew Campanella rented a residence from Northern Properties.  Unfortunately it contained toxic levels of chicken feces.  Campanella claimed he contracted histoplasmosis on account of Northern Properties carelessly and negligently failing to clean and maintain the residence.  Boy I bet that last tenant didn’t get his security deposit back.  This isn’t like leaving some nail holes in the wall.
 
Histoplasmosis sounds scary.  The court described it as serious infection caused by a fungus in the environment, particularly in soil containing large amounts of bird or bat droppings. 

Northern Properties sought coverage for Campanella’s suit under a CGL policy issued by Auto-Owners.  At issue was whether the bodily injury was caused by an “occurrence,” defined as an accident.

As Auto-Owners saw it, no way, no how could Campanella’s injury have been caused by an accident: “[I]t is difficult to imagine any scenario in which the accumulation of chicken feces in a residential dwelling to a ‘toxic level’ due to a failure to clean the premises would be accidental.”

But the court saw it much differently: “Even if Northern Properties intentionally allowed a toxic build-up of chicken feces on the premises, Auto-Owners cannot point to any facts suggesting that any party foresaw Campanella contracting histoplasmosis.  In fact, Auto-Owners admits that ‘most people who breathe in the [histoplasma fungi] spores don’t get sick.’  In other words, Campanella contracting histoplasmosis was unexpected and unforeseen—an ‘accident’ as both Minnesota and Wisconsin have defined it.”

This is the classic issue in many “accident” cases.  Yes, the insured did something wrong and it caused injury.  But was the injury expected and foreseen?  [The less difficult accident case is an injury from a circumstance or confluence of circumstances that nobody could see coming.]     

In the end, while Northern Properties cleared the insuring agreement’s “accident” hurdle, no coverage was owed on account of the Auto-Owner’s policy’s fungus exclusion.