In Georgia Stormwater is a Pollutant
Stormwater Alone—Even Uncontaminated—Constitutes a Pollutant
Post 5186
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In Auto-Owners Insurance Company v. Tabby Place Homeowners Association, Inc., et al., Civil Action No. 4:21-cv-346, United States District Court, S.D. Georgia (September 3, 2025) found no coverage.
The decision of the USDC presents a detailed judicial opinion on a declaratory judgment action involving Auto-Owners Insurance Company, Tabby Place Homeowners Association (HOA), and various property owners. The central issue concerned whether Auto-Owners had a duty to defend or indemnify the HOA in an underlying lawsuit brought by property owners alleging property damage from stormwater flooding linked to the HOA’s stormwater retention ponds.
BACKGROUND AND PARTIES INVOLVED
The underlying litigation involved property owners adjacent to the Tabby Place and Captain’s Cove Subdivisions on St. Simons Island, Georgia, alleging that the design, construction, and maintenance of stormwater retention ponds caused flooding and damage to their properties. The HOA acquired ownership of the retention ponds in September 2020, after the property owners filed their initial lawsuit in 2019. Auto-Owners issued two insurance policies to the HOA in April 2019: a Commercial General Liability (CGL) Policy and a Commercial Umbrella Policy, which are at issue in this declaratory judgment action. Auto-Owners sought a declaration that it has no duty to defend or indemnify the HOA based on policy exclusions, primarily the pollution exclusions, while the HOA and property owners contest this position.
INSURANCE POLICIES AND COVERAGE DISPUTE
The CGL Policy and Umbrella Policy provide coverage for property damage and personal injury but contain exclusions, including pollution exclusions. Both policies exclude coverage for property damage arising from the discharge, dispersal, seepage, migration, release, or escape of “pollutants.” The policies define “pollutant” broadly as “any solid, liquid, gaseous or thermal irritant or contaminant,” including smoke, vapor, soot, fumes, acids, alkalis, chemicals, and waste.
Auto-Owners contended that the stormwater flooding alleged in the underlying lawsuit qualifies as damage caused by pollutants under the pollution exclusions, thereby barring coverage. Auto-Owners also argued that the insurer’s duty to defend is triggered only if the claims potentially fall within coverage, and here the pollution exclusions unambiguously apply.
LEGAL ANALYSIS: WHETHER STORMWATER CONSTITUTES A POLLUTANT
The primary legal question is whether stormwater, including stormwater infiltrating into groundwater, qualifies as a “pollutant” under the policies’ pollution exclusions. The court reviewed relevant Georgia law and precedent, noting that courts have consistently held that stormwater alone—even uncontaminated—constitutes a pollutant under similar insurance exclusions. The court rejected arguments that stormwater must be contaminated to qualify as a pollutant or that rising groundwater is excluded from the pollution exclusion.
The court further found no meaningful distinction between direct stormwater runoff and stormwater that infiltrates through the ground and raises groundwater levels, as both scenarios involve the discharge or migration of stormwater, which is a pollutant under the policies. The court cited multiple precedents from Georgia federal courts supporting this interpretation.
PROCEDURAL POSTURE AND MOTIONS FOR SUMMARY JUDGMENT
Three motions for summary judgment were before the court. The court applied the standard that summary judgment is appropriate if there is no genuine dispute of material fact and the moving party is entitled to judgment as a matter of law.
COURT’S HOLDING AND CONCLUSION
The court concluded that the pollution exclusions unambiguously barred coverage for the property damage claims alleged in the underlying action because the damage arises from the discharge and migration of stormwater, which is a pollutant under Georgia law and the policy definitions. As a result, Auto-Owners had no duty to defend or indemnify the HOA for the claims in the underlying lawsuit
This ruling clarified the application of pollution exclusions in insurance policies to stormwater-related property damage claims under Georgia law, affirming that stormwater is considered a pollutant regardless of contamination or mode of discharge.
ZALMA OPINION
Insurance is a contract. It defines the terms where it will respond with indemnity and the terms where it will not respond. In Georgia stormwater – even when it is not contaminated – is still a pollutant and therefore the insurer neither owed defense nor indemnity to its insured.
(c) 2025 Barry Zalma & ClaimSchool, Inc.
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Post 5407
Fraud & the Fear of Bad Faith Suits
Posted on July 22, 2026 by Barry Zalma
See the full video at https://lnkd.in/gWQQEySW and at https://lnkd.in/gyhdK6wv
This is a Fictionalized True Crime Story of Insurance Fraud explaining why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is one of a collection designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime.
This is a Fictionalized True Crime Story of Insurance Fraud explaining why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is one of a collection designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime.
After ...
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Post 5397
Posted on July 20, 2026 by Barry Zalma
See the video and at https://lnkd.in/gNUs2XzT and at https://lnkd.in/g2MawyzX
Magistrate Issues a Search Warrant if there is a Fair Probability that Contraband or Evidence of a Crime will be Found in a Particular Place.
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As part of the investigation, the FBI obtained an August 19, 2022 warrant to search Driscoll’s Sterling Pharmacy Yahoo email account for emails from January 1, 2018 through December 31, 2020. Driscoll moved to suppress the resulting evidence, arguing that the warrant lacked probable cause, was overbroad, and rested on material misstatements and omissions.
LAW:
The ...
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Post 5396
See the video and at https://rumble.com/v7ctgmq-the-great-jewel-theft.html at https://youtu.be/aRbQ2sJfGwA
This is a Fictionalized True Crime Story of Insurance Fraud explaining why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is one of a collection designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the ¬¬¬Perpetrators than any Other Crime.
The Insured purchased, for the first time in his life, a policy of Personal Articles Floater Insurance (PAF) scheduling $125,000 worth of ladies jewelry. He advised the insurer that the jewelry was always kept in a class E safe at his residence. He also told the insurer that he was employed full time as the owner of a gasoline service station and that he had never been canceled or suffered a previous loss.
One month after the policy was ...
Day Care Owner Loses Subsidies Because She Criticized State
Post 5421
Posted on August 11, 2026 by Barry Zalma
First Amendment Right Will be Allowed to Go to Trial
In Betsey J. Grant v. Maine State Department Of Heath And Human Services, No. 1:25-cv-00490-JAW, United States District Court, D. Maine (August 6, 2026), Betsey J. Grant, a licensed childcare provider and operator of Tiny Tikes Daycare in Trenton, Maine, sued Maine DHHS and several employees after she publicly criticized DHHS before Maine’s Government Oversight Committee and alleged that officials retaliated against her.
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Rescission for Material Misrepresentation
Post 5418
Posted on August 5, 2026 by Barry Zalma
An Insurer May Rescind An Insurance Policy Where The Applicant Made A Material Misrepresentation In The Application.
In Union Mutual Fire Insurance Company v. 844 Knickerbocker, LLC, et al. No. 2024-10359, Index No. 602824/22, 2026 NY Slip Op 04789, Supreme Court of New York, Second Department (July 29, 2026) Union Mutual Fire Insurance Company issued commercial insurance policies to 844 Knickerbocker, LLC, and Sanjaya Mallick based on applications stating that the insured property contained two apartment units. After an underlying personal injury action was filed, Union Mutual determined that the property actually contained three apartment units and rescinded the policies on the ground that the defendants had made a material misrepresentation in the applications.
LAW:
A misrepresentation is material if the insurer would not have issued the same policy, or would have issued it only on different terms, had the true ...
Rescission for Material Misrepresentation
Post 5418
Posted on August 5, 2026 by Barry Zalma
An Insurer May Rescind An Insurance Policy Where The Applicant Made A Material Misrepresentation In The Application.
In Union Mutual Fire Insurance Company v. 844 Knickerbocker, LLC, et al. No. 2024-10359, Index No. 602824/22, 2026 NY Slip Op 04789, Supreme Court of New York, Second Department (July 29, 2026) Union Mutual Fire Insurance Company issued commercial insurance policies to 844 Knickerbocker, LLC, and Sanjaya Mallick based on applications stating that the insured property contained two apartment units.
LAW:
A misrepresentation is material if the insurer would not have issued the same policy, or would have issued it only on different terms, had the true facts been disclosed. To establish materiality as a matter of law, the insurer must submit documentation of its underwriting practices, such as manuals, guidelines, bulletins, or rules addressing similar risks.
DISCUSSION/ANALYSIS:
As a result, the...
