Illinois Federal Court Holds CGL Policy Does Not Cover Remediation Costs for Illegal Dumping

The U.S. District Court for the Central District of Illinois, applying Illinois law, held that a commercial general liability policy did not provide coverage for a suit seeking compensation for costs associated with remediation of the insured’s unlawful dumping. Great West Cas. Co. v. Ryan VanFleet, 2026 WL 822800 (C.D. Ill. Mar. 25, 2026).

The insured, a trucking company, was sued by a municipality claiming to have remediated debris illegally dumped by the insured. The municipality hired the insured in connection with a demolition project. After the insured disposed of debris, including asbestos material, the Illinois Environmental Protection Agency investigated, found violations of environmental regulations, and mandated that the municipality remediate the debris. In so doing, the municipality spent $217,500 and sued the insured, seeking to hold it responsible.

The insured tendered the matter to the insurer, which then initiated an action seeking a declaration regarding coverage, which included the municipality as a defendant. The insured failed to respond to the complaint, but the municipality—while conceding that the asbestos exclusion and pollution exclusion in the policy applied to some of the allegations—argued on summary judgment that the insurer had a duty to defend the trucking company because the complaint included some allegations of non-intentional conduct and for some property damage unrelated to asbestos or pollution. In response, the insurer argued that any claims unrelated to asbestos did not seek relief for property damage caused by an “occurrence,” which the policy defined as “an accident.”

The court accepted that the presence of demolition debris could constitute “physical injury to tangible property,” but concluded that where the alleged property damage was solely the intended placement of demolition debris, the harm was not accidental and therefore not an “occurrence.” The court therefore denied the municipality’s motion for summary judgment, granted the insurer’s motion for summary judgment, and entered a default judgment against the non-responding insured.