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Insurance firms fight legal costs

School district seeks coverage

PITTSBURGH — The Butler School District is being sued by its insurance providers, which are aiming to avoid paying for legal costs and any judgments associated with a lawsuit filed over lead exposure.

Attorneys John C. Sullivan and Kathleen K. Kerns of Post and Schell P.C. in Philadelphia filed the suit in U.S. District Court last week on behalf of The Netherlands Insurance Company of Boston and Peerless Insurance Company of Keene, N.H.

Dr. Dale Lumley, the school’s former superintendent, is also named as a defendant in the suit.

The suit is seeking a declaration from the defendants that the two insurance providers have no obligation under their policies to pay defense costs or pay judgments in connection with Tait vs. Butler School District.

Lawyers from Dallas W. Hartman P.C. and Meyers, Evans, Lupetin and Unatin filed that suit in federal court in February on behalf of district resident Jennifer Tait, whose daughter attends Summit Township Elementary School, and “all other similarly situated individuals.”

The suit, which the attorneys hope will become a class-action claim, seeks to compel the district to provide more extensive medical treatment and testing and other damages for any people who were exposed to lead-tainted water at the Summit school.

It alleges that Lumley and other district employees made a “conscious and intentional decision” not to take appropriate steps to fix the water system at the school after high lead and copper levels were found in samples collected last August.

The school board last week voted to hire Burns White law firm to assist Dillon McCandless King Coulter and Graham in defending the district against the lawsuit.

The complaint filed by the insurance companies states that the district is still seeking coverage after the insurers sent letters to Lumley and the district dated Feb. 17 stating that they would not participate in the defense of the suit.

The complaint argues that the type of bodily injury claim in the Tait lawsuit is not covered by the district’s commercial general liability policy, its pollution liability policy or its school leaders errors and omissions policy.

The pollution liability policy includes exclusions from coverage, which include “expected or intended injury, failure to comply with environmental laws and statutory or governmental assertions and cleanup costs,” according to the complaint.

The complaint also cites exclusions in the errors and omissions policy, which includes a section dealing specifically with lead.

Under that policy, the insurer is excluded from any claim arising from “the installation, storage, removal, disposal, handling, use or existence of, exposure to, or contact with lead or materials containing lead,” the complaint says.

District solicitor Tom King said Monday that he expected the suit to be filed in light of the letter denying coverage and the district and, after consulting with Burns White, will likely make a counter claim in hopes of having its legal costs covered by the insurance providers.

Following an executive session at the school board meeting Monday night, the board approved — by a vote of six to two with Bill Halle and Suzie Bradrick voting against — to hire attorney James Miller of Dickey, McCamey and Chilcote to defend Lumley in both lawsuits.

Lumley retained Miller as legal counsel, who then made a written request to King for the district to pay his costs.

King said that the district was advised by Burns White that it must cover legal costs for Lumley under state law, which states that when an action is brought against an employee of a local agency for damages from a personal injury, the local agency must defend the action upon request from the employee.

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