Environmental Claim: Gas Station, Commercial and Residential Area, Illinois

The insurer retained SCS Engineers to review litigation-related documentation and develop an expert analysis of the activities and role of the insured in a substantial gasoline release at an active gas station. The insured was one of a number of parties named in a lawsuit alleging negligence causing the subject release. The insured, a tank system contractor, was accused of being negligent specifically in the installation and repairs of tank system equipment, which allegedly contributed to the subject release.

Environmental Insurance Services - SCS Engineers
The source of a significant environmental release is the dispenser base (top of photo), where an equipment failure occurred. Green and blue plastic product lines run from tanks to the dispenser. Gaskets on the dispenser around product lines also failed. A number of factors contribute to the failures, requiring further investigation.

Environmental Challenge
The claim consisted of the release of gasoline from multiple system components, which then entered site soils and groundwater. The contamination associated with this release migrated off-site with subsurface vapors that subsequently entered a number of nearby homes. Residents of those homes relocated temporarily during the installation of vapor mitigation systems to alleviate the presence of potentially harmful levels of volatile organic compounds in the structures. On-and off-site investigative and remedial actions took place.

SCS reviewed numerous technical reports, facility equipment, and product inventory records, plus the deposition transcripts of involved individuals. Our review focused on developing a detailed timeline of who did what, why, and when, including which events occurred involving facility equipment and personnel. Drawing on our years of experience with petroleum distribution facility and underground storage tank systems, the evaluation included numerous technical and human-related factors associated with this release.  We specifically isolated the work completed and the actions that were undertaken by the insured from those of other parties named in the lawsuit. This formed the basis of the conclusions provided to our client.

Outcomes and Benefit
Our evaluation concluded with an expert report presented to the insurer and insured’s attorneys which included a chronology of facility-related activities for the period prior to, during, and after the subject release. The results of our investigation combined critical information from facility records and the deposition transcripts into an overall opinion of whether the actions of the insured did or did not contribute to the cause of the release, and if they did, to what extent.

SCS’s expert report was very well received by the insured’s attorney and was used during subsequent settlement negotiations with the facility owner and their attorneys.  These negotiations resulted in a significantly reduced contribution from the insured and kudos received by SCS from the insured’s attorneys and our client (the insurer).