The defendant fuel oil distributor was sued after a fuel oil tank it sold leaked, causing property damage.
The defendant brought a third-party action against its insurers seeking a declaration of a duty to defend.
One insurer argued the claim was barred by a one-year contractual limitation period incorporated from statutory fire conditions.
The court held that the fire statutory conditions could not be applied to third-party liability coverage without anomalous consequences, meaning the general two-year statutory limitation period applied and the claim was not barred.
The court found the first insurer had a duty to defend as there was a mere possibility the damage occurred during its policy period.
However, the court dismissed the claims against the other insurers, finding that pollution exclusions and specific policy definitions precluded coverage.