One issue currently before the California Supreme Court is the issue of allocation between covered and uncovered damages where pollution at a site is partly caused by gradual pollution and partly caused by a "sudden and accidental" event. The first case to address this, Golden Eagle Refinery Co. v Associated International Ins. 85 Cal. App. 4th 1300 (2001), held that the burden was on the insured to prove the sudden event caused an incremental increase in clean-up costs. The Court of Appeals in the State of California case took a different approach, applying the "concurrent cause" doctrine to hold that there was coverage as long as the sudden event was a contributing factor to the contamination at the site, a much lower burden for the insured.

The California Supreme Court granted review, and has just set argument in the case for January 8 at 9:00 am in San Francisco. The argument should be interesting. We will keep you posted.