This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (1998).




Kathleen Johnson, et al.,



Woodstock Homeowners' Association II,

Defendant and Third Party Plaintiff,

David Niven, d/b/a ABC Construction,


Auto-Owners Insurance Company,


Filed July 27, 1999


Kalitowski, Judge

Hennepin County District Court

File No. 981952

Daniel B. Johnson, Alan R. Nettles, Meyer & Njus, P.A., 1100 Pillsbury Center, 200 South Sixth Street, Minneapolis, MN 55402-4121 (for appellants)

Mark A. Pilney, Lars C. Erickson, Reding & Pilney, 814 Degree of Honor Building, 325 Cedar Street, St. Paul, MN 55101 (for respondent)

Considered and decided by Kalitowski, Presiding Judge, Lansing, Judge, and Crippen, Judge.

U N P U B L I S H E D   O P I N I O N


Appellants Kathleen Johnson and Jacob Berg challenge the district court's grant of summary judgment for respondent Auto-Owners Insurance Company (Auto-Owners). Appellants contend the district court erred in concluding that the pollution exclusion in Auto-Owners' insurance contract with Woodstock Homeowners' Association (Woodstock) bars coverage of appellants' personal injury claim. We reverse.


On appeal from a grant of summary judgment this court determines whether there are any genuine issues of material fact and whether the district court erred in its application of the law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990). Issues of insurance coverage are questions of law for the court to decide. State Farm Ins. Cos. v. Seefeld, 481 N.W.2d 62, 64 (Minn. 1992). As such, reviewing courts are not bound by and need not give deference to the district court's determination of the proper legal interpretation of an insurance policy. Id.

When a court interprets an insurance policy it must construe the terms of the insurance contract according to the terms the parties have used. Bobich v. Oja, 104 N.W.2d 19, 24 (Minn. 1960).

An insurance policy provision is to be interpreted according to both its plain, ordinary meaning and what a reasonable person in the position of the insured would have understood it to mean.

Retail Sys., Inc. v. CNA Ins. Cos., 469 N.W.2d 735, 737 (Minn. App. 1991), review denied (Minn. Aug. 2, 1991). Provisions that are reasonably susceptible to more than one meaning are ambiguous, and ambiguous policies must be construed in favor of the insured. Id. Exclusions in insurance contracts are also read narrowly against the insurer. Seefeld, 481 N.W.2d at 64. An insurer bears the burden of proving that a policy exclusion bars coverage. Independent Sch. Dist. No. 197 v. Accident & Cas. Ins. of Winterthur, 525 N.W.2d 600, 608 (Minn. App. 1995), review denied (Minn. Apr. 27, 1995).

Auto-Owners insured Woodstock against liability for bodily injury or property damage. But the policy excluded from coverage:

"Bodily injury," "property damage" or "personal injury" arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of pollutants:

(a) At or from premises you own, rent or occupy * * *.

We agree with respondent that under the terms in the policy appellants' alleged personal injuries arose out of the release or escape of pollutants. Thus, if the defendant homeowners' association owned, rented or occupied the involved premises, the exclusion applies.

The district court determined the exclusion applies to bar coverage because

Woodstock Homeowners' Association is a substantial occupier of the premises and certainly controls, maintains, and occupies the common grounds, including the roof, more than any other occupant of the individual units.

But "occupy" means "[t]o dwell or reside in." American Heritage Dictionary of the English Language, 1251 (3d ed. 1992). Thus, the district court's interpretation of "occupy" as meaning something akin to control or maintenance is not consistent with the common usage of the term. Because the plain meaning of "occupy" does not exclude coverage and because insurance contracts are to be construed in favor of the insured, we conclude that the Woodstock Homeowners' Association did not "occupy" the pipes according to the contract.

Respondent argues that if the homeowners' association did not occupy the pipes in question, the association at least owned the pipes. See Myers Through Myers v. Price, 463 N.W.2d 773, 775 (Minn. App. 1990) (stating that appellate court will affirm the judgment if it can be sustained on any grounds), review denied (Minn. Feb. 4, 1991). But while the homeowners' association had control over the common areas, the association's legal documents indicate that ownership of the common areas was vested in the homeowners as tenants in common, not in the homeowners' association.

If the insurer had wanted to draft an exclusion covering the property at issue it could have done so. For example, other provisions in this same insurance contract refer to "[p]roperty of others that is in your care, custody or control." We conclude that Auto-Owners has failed to establish that the pollution exclusion in its contract with Woodstock unambiguously applies to bar coverage. Finally, we reject Auto-Owners' arguments based on an unpublished decision from this court because: (1) ownership of the property in question was not at issue in that case; and (2) our unpublished decisions have no precedential value. Minn. Stat. § 480A.08, subd. 3 (b) (1998).