Wisconsin Supreme Court Says No to 'Guano'

If your vacation home got a bat infestation that was so bad you couldn't get the smell out and had to tear the place down, would your homeowner's insurance policy have to cover the damage?

"No," says the Wisconsin Supreme Court, at least if your policy is written with the same language as that in Hirschhorn v. Auto-Owners Insurance Company, an opinion released Tuesday.

The Hirschhorns had a nice little place up on Lake Tomahawk. They used it a few times a year and arranged for neighbors and professional cleaners to keep an eye on it when they weren't around. Then, one year, they discovered a colony of bats in the place. Apparently a big one, because the entire space between their siding and walls was coated in bat guano. Despite making a great fertilizer, it's not something you want in your house.

Professional removal of the guano did nothing to remove the "penetrating and offensive odor," so the Hirschhorns razed their house and built a new one.  They submitted a claim to their insurance company, which the insurance company denied. That denial was upheld by the court under the language of the insurance policy.

So what did the policy say? It excluded all damage caused by the "discharge, release, escape, seepage, migration or dispersal of pollutants."

"Pollutants" was defined as "any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals, liquids, gases and waste.  Waste includes materials to be recycled, reconditioned or reclaimed."

The court turned to several dictionaries and determined that bat guano was indeed a pollutant — specifically that it was both an irritant and a contaminant.  They compared this case to two earlier cases — one that held carbon dioxide was not a pollutant under identical policy language, and one that held lead paint chips were a pollutant.  The court noted that the term "waste" also included, well, excrement such as guano. 

(Two justices dissented — they would have held "pollutant" to be ambiguous, meaning it would have to be interpreted in favor of coverage.)

The court also held that the laundry list of verbs were essentially a series of synonyms for the process of stuff moving from a "contained" to an "uncontained" state, applying to the bat guano seeping through the structure and its odor pervading ever surface.

So, while it may seem to some of us that an insurance policy should cover something like bat crap wrecking your house, the truth is that a policy is a contract like any other, and what a contract should say has almost nothing to do with what it actually does say.  Good lesson to keep in mind.