A case was recently decided by the Wisconsin Supreme Court that got my attention. This is not law in Ohio and may never be law in Ohio. If a similar set of facts were to come before an Ohio court, it is likely that this case may be referred to by one of the parties as informative or persuasive. The Ohio judge, however, would be the one to determine that.
The trouble all started in early 2011 when Robert and Jane Falk, dairy farmers with 600 cows near West Bend, Wisconsin, spread liquid cow manure onto their farm fields for the purpose of fertilization. Sound familiar? This happens all of the time in Ohio and throughout the country. The Falks applied the manure in accordance with a nutrient management plan approved by their county land and water conservation department.
Six neighbors complained to the Wisconsin Department of Natural Resources that their wells were contaminated. DNR investigated and concluded that manure from the Falks’ farm leeched into and contaminated wells owned by these neighbors. The contamination, according to DNR, made the wells unusable and the water undrinkable. The neighbors allege that manure, nitrates and bacteria, including E.coli, seeped into their wells. Additionally, one of the neighbors claims that his child contracted bacterium avium from drinking the contaminated water. As a result, the minor underwent surgery and was hospitalized. The Falks were notified of the findings by DNR by a letter dated May 23, 2011.
I have read all 21 pages of the Wisconsin Supreme Court’s ruling and several legal analyses provided by interested lawyers. I would like to see the evidence substantiating the legal conclusion that the manure from the manure application in early 2011 by the Falks caused the well contamination. One of the attorneys following the case mentioned in his critique that the manure had polluted an aquifer, which in turn contaminated nearby private wells. I have many questions about this.
At any rate, DNR provided grants to some of the neighbors for temporary clean water and to replace their wells. DNR then requested reimbursement from the Falks. The other neighbors paid out of pocket.
The Falks had a farm owner policy from Wilson Mutual Insurance Company. This policy excluded general liability coverage for both “bodily injury” and/or “property damage which results from the actual, alleged or threatened discharge, dispersal, seepage, migration, release, or escape of ‘pollutants’ into or upon land, water, or air.” Once again, the focus of the courts will be on definitions. Specifically is manure a pollutant? If so, the insurance company will not have to pay the neighbors or defend their insured.
In the race to the courthouse, the insurance company arrived first on December 5, 2011, and sought a declaratory judgment to determine whether the farm policy covered the manure contamination alleged by DNR. Wilson Mutual claimed it had no duty to defend the Falks or to provide coverage with respect to the injured parties’ well contamination.
The trial court agreed with the insurance company and granted their motion for summary judgment. In so doing, the trial court ruled that manure was a pollutant. They concluded that spreading manure is a form of recycling waste.
On March 22, 2013, both the Falks and the injured parties appealed this decision. The Court of Appeals reversed the circuit court on December 11, 2013. The language in the Appellate Court decision got some press because they held that “manure has long been a normal and necessary part of the operation of a dairy farm and to a reasonable farmer manure is ‘liquid gold.'” They refused to conclude that manure was “waste” or a “pollutant.” This court also noted that the insurance company was quite happy to insure the equipment used for storage and spreading of manure.
Should you wonder why the neighbors appealed, it is all about the money. The neighbors (and their legal counsel) know that a big insurance company has more assets and better ability to write a check to reimburse the neighbors. It’s as simple as that.
The insurance company promptly appealed the appellate decision to the Wisconsin Supreme Court on April 17, 2014 and got the ruling they wanted on Dec. 30, 2014. Their decision clearly held that manure is a pollutant when it contaminates a well. The state supreme court’s analysis of manure differed substantially from that of the court of appeals. The appellate court looked more generally at the nature of manure as a substance used by dairy farmers. The high court focused on “whether manure is a pollutant at the point it entered the injured parties’ wells.”
In the decision, the court noted that the “occurence” claimed by the Falks was the seepage of manure into a well, not the spreading of manure. I can only wonder if the court would have held differently had the claim against the insurance company been for the actual application of manure.
Keep in mind this ruling is precedential only in Wisconsin. Farmers and contract spreaders, however, should be cautious in relying on a general liability policy to cover damages or injury related to contamination caused by the hauling and spreading of manure.
Dairy farmers (and all farmers) are used to multi-tasking when it comes to concerns —commodity prices, feed costs, interest rates, creditor formulas, weather, antibiotic use, pesticides, and the list goes on and on. This case may not be one that ever affects Ohio’s farmers, but it is good to be aware of what has happened in other states, even if you do not like the conclusion. I’m looking for some good news for next month…