Penn. Nat. Mut. Casualty Ins. v. Jeffers

Pennsylvania National Mutual Casualty Insurance Company v. Tajah Jeffers et al., No. 960, Sept. Term 2017. Opinion by Arthur, J. LIABILITY INSURANCE – PRO-RATA ALLOCATION In cases involving bodily injury resulting from continuous exposure to harmful substances, Maryland courts engage in a “pro rata by time-on-the-risk allocation” of liability among insurers. Under this method, an insurer is liable for that period of time it was on the risk compared to the entire period during which damages occurred. This method of calculating an insurer’s pro rata share of a judgment obtained against its insured requires a court to identify a numerator (representing the insurer’s coverage period, or time on the risk) and a denominator (representing the entire period in which the injured person suffered bodily injury).

The court then multiplies the resulting ratio by the total judgment amount to determine the insurer’s pro rata share. In this case, two plaintiffs had obtained judgments against an insured party. One plaintiff experienced elevated blood-lead levels prior to her residence at a property owned by the insured. Both plaintiffs continued to exhibit elevated blood-lead levels after moving out of the insured’s property.

Here, the plaintiffs’ period of injury is measured by the entire period in which they displayed elevated blood-lead levels, including when they did not reside at the insured’s property. LIABILITY INSURANCE – IN UTERO DAMAGES While an unborn child may suffer bodily injury from exposure to lead while in utero, plaintiffs seeking to recover damages must present sufficient evidence to establish when any such injury began. In this case, there was no evidentiary basis to conclude that the unborn child began to suffer bodily injury at any specific point while she was in utero. Accordingly, the period before the child’s birth was excluded from the calculation of the liability insurer’s pro rata share of her judgment based on its time on the risk.

LIABILITY INSURANCE – POST-JUDGMENT INTEREST A “standard interest clause” in an insurer’s policy often states that the insurer will pay “[a]ll interest on the full amount of any judgment that accrues after entry of the judgment and before [it has] paid, offered to pay or deposited in court the part of the judgment that is within the applicable limits of insurance.” Under such a clause, an insurer is liable for all post-judgment interest accruing from the time the original judgment is entered, even if the insurer is not obligated to indemnify the insured for the entire judgment. The insurer’s obligation comes to an end when it pays, unconditionally offers to pay, or deposits into court the principal amount of its liability under the judgment. The insurer need not tender all interest that it owes in order to toll its obligation for the payment of interest. Circuit Court for Baltimore City Case No. 24-C-16-003198 REPORTED IN THE COURT OF SPECIAL APPEALS OF MARYLAND No. 960 September Term, 2017 ______________________________________ PENNSYLVANIA NATIONAL MUTUAL CASUALTY INSURANCE COMPANY V. TAJAH JEFFERS ET AL. ______________________________________ Berger, Arthur, Beachley, JJ. ______________________________________ Opinion by Arthur, J. ______________________________________ Filed: January 31, 2020 Pursuant to Maryland Uniform Electronic Legal Materials Act (§§ 10-1601 et seq. of the State Government Article) this document is authentic.

Suzanne Johnson 2020-06-04 09:02-04:00 Suzanne C. Johnson, Clerk This case involves two issues of insurance coverage that have arisen in the context of judgments for lead poisoning. The first issue concerns the extent of an insurer’s duty to indemnify its insured for damages for continuous bodily injury that occurred before, during, and after the policy period, including bodily injury that may have occurred while a child was in utero. The second concerns the extent of an insurer’s contractual obligation to pay “[a]ll interest on the full amount of any judgment” when it is obligated to indemnify its insured for only part of a judgment. We shall hold that the insurer in this case was not obligated to indemnify the insured for bodily injury that occurred before its policy period began or after its policy period ended.

Although we recognize that an unborn child may suffer bodily injury from exposure to lead while in utero, we shall hold that the evidence in this case was insufficient to establish when any such injury began, and thus insufficient to establish an obligation on the insurer’s part. Finally, we shall hold that the insurer must pay post- judgment interest on the entire amount of the judgment even if it is obligated to indemnify its insured for only part of the judgment. In view of those decisions, we shall reverse the judgment below in part, affirm the judgment in part, and remand the case for further proceedings consistent with this opinion. FACTUAL AND PROCEDURAL BACKGROUND A. Hollins Street Property and Penn National Liability Insurance Policy Tajah Jeffers was born on July 9, 1992.

She moved to 2116 Hollins Street in Baltimore with her parents on March 17, 1994. Tajah resided at 2116 Hollins Street from March 17, 1994, until March 26, 1998, when her family moved into a certified lead-free home. She had blood-lead levels above the Centers for Disease Control and Prevention’s reference level of concern of 5 µg/dL1 from September 24, 1993 (before she moved into 2116 Hollins Street), until June 2, 1998 (after she moved out). Tajah’s sister, Tynae Jeffers, resided at 2116 Hollins Street from her birth, on November 8, 1996, until March 26, 1998.

Tynae had elevated blood-lead levels from shortly after her birth until November 25, 1998 (after she moved out). The following chart illustrates the blood-lead levels for Tajah and Tynae Jeffers at various points relevant to this case: 1 Blood levels are measured in micrograms (µg) per deciliter (dL). A microgram is one-millionth of a gram; a deciliter is one-tenth of a liter, or about three fluid ounces. From 1990 to 2012, the CDC level of concern was 10 micrograms per deciliter.

The level of concern is now five micrograms per deciliter. 2 Tajah Jeffers Tynae Jeffers Date Taken Blood-Lead Date Taken Blood-Lead Level (µg/dL) Level (µg/dL) September 24, 1993 13 May 14, 1997 4 October 29, 1993 11 September 17, 1997 6 March 9, 1994 13 May 1, 1998 22 June 2, 1994 14-15 November 25, 1998 8 September 30, 1994 19-20 March 24, 1995 13-14 September 8, 1995 11-13 May 1, 1996 11 November 13, 1996 13 May 14, 1997 11 September 19, 1997 10 June 2, 1998 7 The shaded areas of the tables show the children’s elevated blood-lead levels when they were not living at 2116 Hollins Street. Stewart Levitas and State Real Estate, Inc., owned, leased, and managed 2116 Hollins Street throughout the children’s residency. Levitas and his company maintained a commercial general liability (“CGL”) insurance policy issued by Pennsylvania National Mutual Casualty Insurance Co. (“Penn National”). The policy insured Levitas for the 3 period from November 27, 1991, through August 1, 1997.2 From August 1, 1997, through August 1, 1998, Levitas was insured by CNA Reinsurance.3 In the insuring agreement in its policy, Penn National agreed “to pay those sums” that Levitas became “legally obligated to pay as damages because of ‘bodily injury’ . . . to which this insurance applies.” This agreement was qualified by a provision stating that “[t]his insurance applies to ‘bodily injury’ . . . only if . . . [t]he ‘bodily injury’ occurs during the policy period.” The policy gave Penn National “the right and duty to defend any ‘suit’ seeking those damages.” B. Underlying Tort Action Against Levitas On August 23, 2012, the Jeffers children filed suit against Levitas and his company in the Circuit Court for Baltimore City.

The suit alleged that the children had suffered injuries from lead exposure as the result of the negligent management of 2116 Hollins Street. It appears that, pursuant to its obligations under the policy, Penn National provided a defense. After a five-day jury trial in November 2014, the jury returned a verdict against Levitas, awarding $3,094,701.50 to Tajah Jeffers and $1,987,333.83 to Tynae Jeffers. The judgments were initially entered on December 2, 2014. 2 Levitas was insured by Penn National under Policy Number 230-0-00-71-80 during the following policy periods: (i) November 27, 1991, to November 27, 1992; (ii) November 27, 1992, to November 27, 1993; (iii) November 27, 1993, to November 27, 1994; (iv) November 27, 1994, to November 27, 1995; (v) November 27, 1995, to November 27, 1996; and (vi) November 27, 1996, to August 1, 1997. 3 CNA Reinsurance did not participate in any of the proceedings below and is not a party to this appeal. 4 Because of the statutory cap on non-economic damages, Md. Code (1974, 2013 Repl.

Vol.), § 11-108 of the Courts and Judicial Proceedings Article, the court issued a revised judgment in favor of Tajah Jeffers in the amount of $2,413,134.33 and in favor of Tynae Jeffers in the amount of $1,650,619.33. The date on which the revised judgments were entered was December 14, 2014. Levitas appealed, but we affirmed in an unreported opinion, Levitas v. Jeffers, No. 2180, Sept. Term 2014, 2015 WL 9306757 (Md. Ct. Spec. App. Dec. 21, 2015).

On April 25, 2016, the Court of Appeals denied Levitas’s petition for a writ of certiorari. C. Declaratory Judgment Action Against Penn National On May 16, 2016, the Jeffers children filed this suit in the Circuit Court for Baltimore City against Penn National and Levitas, to “collect on a final judgment” against Levitas. The children were able to bring a direct action against Levitas’s insurer under Md. Code (1997, 2017 Repl. Vol.), § 19-102(b)(2) of the Insurance Article, which permits an injured party to bring an action against a tortfeasor’s insurance company “for the lesser of the amount of the judgment recovered in the action against the insured or the amount of the policy” when the insured is insolvent.

As amended, the children’s complaint alleged that Penn National had breached its contractual obligation under the policy by failing to indemnify Levitas for the “full amount” of the judgments. The children sought a declaratory judgment that Penn National’s policy provides “insurance coverage for the entire amount” of the judgments. In its answer to the complaint, Penn National asserted that it was obligated to indemnify Levitas only for the pro-rated portion of the damages that represented the 5 bodily injury that the children had suffered while Penn National insured Levitas. Penn National denied that it was obligated to indemnify Levitas for the entire period during which the children had suffered bodily injury.4 D. Cross-Motions for Summary Judgment Penn National moved for summary judgment.

Its motion asserted that, pursuant to Mayor & City Council of Baltimore v. Utica Mutual Insurance Co., 145 Md. App. 256 (2002), cert. granted, 371 Md. 613 (2002), appeal dismissed, 374 Md. 81 (2003), the insurer’s liability to the Jeffers children was limited to its pro-rata time-on-the-risk, i.e., that its liability was limited to the ratio of “‘th[e] period of time it was on the risk compared to the entire period during which damages occurred.’” Id. at 313 (quoting Domtar, Inc. v. Niagara Fire Ins. Co., 563 N.W.2d 724, 732-33 (Minn. 1997)) (emphasis in original). Penn National contended that the “period during which damages occurred” included (1) the period when both children had elevated blood-lead levels after they moved out of 2116 Hollins Street and (2) the period when Tajah Jeffers had elevated blood-lead levels before she moved into 2116 Hollins Street. The Jeffers children opposed Penn National’s motion and asserted a cross-motion for summary judgment on their own behalf.

They argued that, in Penn National’s calculations of its pro rata share of the judgments, the insurer had erroneously diluted its 4 Penn National also filed suit in the United States District Court for the District of Maryland against both Levitas and the Jeffers children, Case 1:16-cv-02060-CCB. In that suit, Penn National sought a declaration that its responsibility for the final judgments extended only to its pro-rata time on the risk. The federal district court stayed the case, pending the resolution of the circuit court case. 6 liability (1) by lengthening the period during which the children suffered bodily injury to include time before and after they resided at 2116 Hollins Street and (2) by discounting its liability for Tynae Jeffers’s judgment by not including the bodily injury that she had allegedly suffered at 2116 Hollins Street while she was in utero. In the children’s view, Tajah Jeffers’s damages began only when she moved into 2116 Hollins Street and ended when she moved out, while Tynae Jeffers’s damages began at instant of conception (when her mother lived at 2116 Hollins Street) and ended when she moved out.

The children also argued, briefly, that Penn National’s obligation was not limited to its pro rata share of the judgments based on its time on the risk and that Penn National was obligated, instead, to indemnify Levitas for the full amount of the judgments. In addition to challenging Penn National’s positions concerning its liability for the judgments, the Jeffers children raised the issue of the insurer’s responsibility for post- judgment interest. They invoked the so-called “standard interest clause” in Penn National’s policy, which states, in pertinent part, that the insurer “will pay . . . [a]ll interest on the full amount of any judgment that accrues after entry of the judgment and before [it has] paid, offered to pay or deposited in court the part of the judgment that is within the applicable limits of insurance.” Under the standard interest clause, the children asserted, Penn National was responsible to pay post-judgment interest on the full amount of the judgments from the time the original judgments were entered on December 2, 2014. In opposition, Penn National averred that it was obligated to pay post-judgment interest only on its pro rata share of the judgments. 7 On April 21, 2017, while the summary judgment motions were pending, Penn National made payments to the Jeffers children in accordance with its calculation of its liability on the judgments.

Tajah Jeffers received a principal payment of $1,737,964.15 and an interest payment of $419,968.32, in accordance with Penn National’s contention that it was liable for only about 72 percent of her $2,413,134.33 judgment and 72 percent of the post-judgment interest. Tynae Jeffers received a principal payment of $594,222.96 and an interest payment of $143,590.32, in accordance with Penn National’s contention that it was liable for only 36 percent of her $1,650,619.33 judgment and 36 percent of the post-judgment interest. The Jeffers children accepted the payments without prejudice to their right to contend that Penn National had underestimated its liability. E. Judgment of the Circuit Court On April 26, 2017, the circuit court held a hearing on the parties’ cross-motions for summary judgment.

On May 3, 2017, the court issued a written order, in which it calculated Penn National’s liability on the judgments in accordance with the insurer’s pro rata time on the risk. In calculating Penn National’s pro rata share of the judgments, the court was required, first, to identify a numerator (representing Penn National’s time on the risk) and a denominator (representing the period in which each child had suffered bodily injury). The court was then required to multiply the resulting ratio or fraction by the total amount of the judgments to determine Penn National’s pro rata share. For the numerator in Tajah Jeffers’s case, the court began with the date when she moved into 2116 Hollins Street (March 17, 1994) and ended with the date when Penn 8 National’s Policy ended (August 1, 1997) – a period of 1233 days.

For the denominator (the period in which Tajah suffered bodily injury), the court again began with the date when she moved into 2116 Hollins Street (March 17, 1994) and ended with the date when she moved out (March 26, 1998) – a total of 1470 days. Therefore, the court concluded that Penn National was responsible for 1233/1470 or 83.877551% of the judgment, totaling $2,024,007.98. The court also concluded that Penn National was responsible for post-judgment interest in the amount of $485,778.71, which represented 1233/1470 or 83.877551% of the interest that had accrued since December 2, 2014. The court rejected Penn National’s contention that the denominator should be greater than 1470 (and thus that Penn National’s pro rata share should be less than 1233/1470 of the judgment) because it should include the periods during which Tajah had elevated blood-lead levels before and after she lived at 2116 Hollins Street.

The court used a similar method to calculate Penn National’s liability for Tynae Jeffers’s $1,650,619.33 judgment. For the numerator in Tynae’s case, the court began with her date of birth (November 8, 1996) and ended with the date when Penn National’s Policy ended (August 1, 1997) – a period of 266 days. For the denominator, the court again began with her date of birth (November 8, 1996) and ended with the date when she moved out of 2116 Hollins Street (March 26, 1998) – a total of 503 days. Therefore, the court concluded that Penn National was responsible for 266/503 or 52.882704% of Tynae’s judgment, totaling $872,892.13.

The court also concluded that Penn National was responsible for post-judgment interest in the amount of $209,494.00, which represented 266/503 or 52.882704% of the interest that had accrued since December 2, 9 2014. As it did with Tajah Jeffers, the court rejected Penn National’s argument that the denominator should be greater than 503 days (and thus that Penn National’s pro rata share should be less than 266/503 of the judgment) because it should include the period during which Tynae Jeffers had elevated blood-lead levels after she moved out of 2116 Hollins Street. The court also rejected Tynae’s argument that both the numerator and the denominator should include the period in which she had allegedly suffered bodily injury at 2116 Hollins Street while she was in utero. The following chart compares the calculations proposed by Penn National and the Jeffers children and the calculations ultimately used by the circuit court: 10 Tajah Jeffers Penn National Jeffers Circuit Court Numerator Mar. 17, 1994 Mar. 17 , 1994 Mar. 17 , 1994 Start (move-in date) (move-in date) (move-in date) Numerator Aug. 1, 1997 Aug. 1, 1997 Aug. 1, 1997 End (date Penn National (date Penn National (date Penn National policy ended) policy ended) policy ended) Denominator Sept. 24, 1993 Mar. 17 , 1994 Mar. 17 , 1994 Start (first elevated blood- lead level) (move-in date) (move-in date) Denominator June 2, 1998 Mar. 26 , 1998 Mar. 26 , 1998 End (last elevated blood- lead level) (move-out date) (move-out date) TOTAL 1233 days = 72% 1233 days =83.8776% 1233 days =83.8776% 1712 days 1470 days 1470 days Tynae Jeffers Penn National Jeffers Circuit Court Numerator Nov. 8, 1996 Feb. 16, 1996 Nov. 8, 1996 Start (date of birth or (estimated date of (date of birth or move- move-in) conception) in) Numerator Aug. 1, 1997 Aug. 1, 1997 Aug. 1, 1997 End (date Penn National (date Penn National (date Penn National policy ended) policy ended) policy ended) 11 Denominator Nov. 8, 1996 Feb. 16, 1996 Nov. 8, 1996 Start (date of birth or (estimated date of (date of birth or move- move-in) conception) in) Denominator Nov. 25, 1998 Mar. 26 , 1998 Mar. 26 , 1998 End (last elevated blood- (move-out date) (move-out date) lead level) TOTAL 266 days =36% 532 days = 69.181% 266 days = 52.882704% 747 days 769 days 503 days In Tajah Jeffers’s case, the circuit court concluded that Penn National was obligated to pay $2,024,007.98 as its pro rata share of the judgment and $485,778.71 as its pro rata share of the post-judgment interest.

In Tynae Jeffers’s case, the circuit court concluded that Penn National was obligated to pay $872,892.13 as its pro rata share of the judgment and $209,494.00 as its pro rata share of the post-judgment interest. From those sums, the court subtracted the payments that Penn National had made on April 21, 2017. In Tajah Jeffers’s case, Penn National had paid $1,737,964.15 towards its pro rata share of the judgment and $419,968.32 in post-judgment interest. After subtracting those sums from its computation of Penn National’s pro rata share of the judgment and the post-judgment interest, the court entered summary judgment in favor of Tajah for $286,113.83, plus $65,810.39 in interest from December 2, 2014, to April 21, 2017.5 5 The court appears to have made an arithmetic error in computing Penn National’s share of the judgment.

The court concluded that Penn National was obligated to pay (. . . continued) 12 In Tynae Jeffers’s case, Penn National had paid $594,222.96 towards its pro rata share of the judgment and $143,590.32 in post-judgment interest. Therefore, the court entered summary judgment in favor of Tynae for $278,669.17 in principal ($872,892.13 minus $594,222.96) and $65,903.79 in interest ($209,494.11 minus $143,590.32) from December 2, 2014, to April 21, 2017. The court ruled that post-judgment interest would continue to accrue on the unpaid principal amount of the judgment, but not on the unpaid interest, until Penn National paid, offered to pay, or deposited into court its total indemnification obligation. Nonetheless, the court decided that Penn National was obligated to pay post-judgment interest only on its proportional share of the judgments, and not on the full amount of the judgments.6 Penn National filed a timely motion to alter or amend the judgment, which the circuit court denied.

Penn National then filed a timely notice of appeal to this Court, and the children noted a timely cross-appeal.7 (. . . continued) $2,024,007.98, and Penn National had already paid $1,737,964.15. $2,024,007.98 minus $1,737,964.15 equals $286,043.83, not $286,113.83, as the circuit court said. 6 In form, the court denied Penn National’s motion and granted the children’s cross-motion. In substance, the court granted Penn National’s motion insofar as it agreed that the insurer was liable only for a pro rata share of the judgments based on its time on the risk, and not for the entire amount of the judgments (as the Jeffers children argued). The court also granted Penn National’s motion insofar as it agreed that Penn National was obligated to pay only its pro rata share of the interest on the judgments. 7 Levitas and his company had been defaulted and had not participated in the case. The court determined that the request for declaratory relief did not include Levitas and (. . . continued) 13 QUESTIONS PRESENTED Penn National poses three questions, which we have condensed and rephrased as follows: 1.

In computing Penn National’s pro rata share of the judgments based on its time on the risk, did the circuit court err in concluding that the period in which damages occurred (i.e. the denominator) ended when the Jeffers children moved out of 2116 Hollins Street, and not a later date when the children had their last elevated blood-lead levels? 2. In computing Penn National’s pro rata share of Tajah Jeffers’s judgment based on its time on the risk, did the circuit court err in concluding that the period in which damages occurred (i.e. the denominator) began when Tajah Jeffers moved into 2116 Hollins Street, and not on an earlier date when she first had elevated blood-lead levels?8 (. . . continued) his company. For that reason, the court dismissed the claims against those parties. No party has challenged the method by which the circuit court disposed of those claims. 8 Penn National phrased its questions as follows: 1.

Did the Circuit Court Erroneously Determine Pennsylvania National Mutual Casualty Insurance Company’s Indemnification Obligation on the Tajah Jeffers Judgment by Calculating the Denominator of the Pro-rata Time-on-the-risk Allocation Formula using the Date she Moved Out of the Property in Lieu of the Date of her Last Elevated Blood Lead Level? 2. Did the Circuit Court Erroneously Determine Pennsylvania National Mutual Casualty Insurance Company’s Indemnification Obligation on the Tynae Jeffers Judgment by calculating the Denominator of the Pro-rata Time-on-the-risk Allocation Formula using the Date she Moved Out of the Property in Lieu of the Date of her Last Elevated Blood Lead Level? 3. Did the Circuit Court Erroneously Determine Pennsylvania National Mutual Casualty Insurance Company’s Indemnification Obligation on the Tajah Jeffers Judgment by Calculating the Denominator of the Pro-rata Time-on-the-risk Allocation Formula using the Date she Moved Into the Property in Lieu of the Date of her First Elevated Blood Lead Level? 14 In their cross-appeal, the Jeffers children pose three questions, which we quote: 1. Did the circuit court err in deciding on summary judgment that in utero exposure to lead should not be included in the time on the risk calculation? 2.

Did the circuit court err in finding that Penn National was only responsible to pay interest on its pro rata share of the judgments, as opposed to the entire judgments? 3. Is an all sums rule, such that Penn National is required to pay all sums that the insured becomes legally obligated to pay as damages, the applicable standard for determination of Penn National’s indemnification obligation to Levitas pursuant to the language of the policy and the facts of this case? For the reasons discussed below, we shall reverse the judgment in part, affirm the judgment in part, and remand for further proceedings consistent with this opinion. DISCUSSION Maryland Rule 2-501(f) permits a court to grant a motion for summary judgment “if the motion and response show that there is no genuine dispute as to any material fact and that the party in whose favor judgment is entered is entitled to judgment as a matter of law.” A trial court’s grant of summary judgment is subject to de novo review on appeal.

Kennedy Krieger Inst., Inc. v. Partlow, 460 Md. 607, 632-33 (2018). We review a declaratory judgment entered pursuant to a motion for summary judgment by “determin[ing] whether it was correct as a matter of law[,] . . . accord[ing] no deference to the trial court’s legal conclusions.” Emerald Hills Homeowners’ Ass’n, Inc. v. Peters, 446 Md. 155, 161 (2016) (citation omitted). 15 A. Trigger, Continuous Trigger, and Pro Rata Allocation The analysis of this case requires a preliminary discussion of some of the basic principles pertaining to insurance coverage, and particularly coverage for claims of bodily injury under CGL policies. We begin with the concept of “trigger of coverage.” A liability insurance policy is said to be “triggered” upon the occurrence of an event that causes the policy to respond to a claim. See Mayor & City Council of Baltimore v. Utica Mut.

Ins. Co., 145 Md. App. 256, 297 (2002) (quoting James M. Fischer, Insurance Coverage for Mass Exposure Tort Claims: The Debate over the Appropriate Trigger Rule, 45 Drake L. Rev. 625 , 652 (1997)) (“‘[t]rigger is a legal rule designed to determine when a policy must respond[]’”). Under a CGL policy, such as the policy that Penn National issued to Levitas, the occurrence of “bodily injury” may be a trigger. See Riley v. United Servs.

Auto. Ass’n, 161 Md. App. 573, 583 (2005), aff’d, 393 Md. 55 (2006). In this case, the Penn National policy defines “bodily injury” to mean “sickness or disease sustained by a person, including death resulting from any of these at any time.” For coverage to attach under the policy, the “bodily injury” must be caused by an “occurrence,” which is defined as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions.” In addition, the bodily injury must “occur[] during the policy period.” In cases involving bodily injury resulting from continuous or repeated exposure to harmful substances such as asbestos or lead, Maryland courts employ what is called a “continuous trigger.” See, e.g., Maryland Cas. Co. v. Hanson, 169 Md. App. 484 , 510 16 (2006); Riley v. United Servs.

Auto. Ass’n, 161 Md. App. at 589 ; Mayor & City Council of Baltimore v. Utica Mut. Ins. Co., 145 Md. App. at 266, 302-03, 304-05 .

In those circumstances, every policy that was in effect while the bodily injury occurred is triggered. Because a continuous trigger may implicate several policies issued over several years by several different insurers, as well as periods in which the insured had no insurance at all, it often becomes necessary to allocate the amount of a judgment among the various insurers and, at times, the insured itself. This case principally concerns the allocation of liability as between Penn National and its insured, Levitas, for the judgments that the Jeffers children obtained. “In lead paint or continuous trigger cases such as this one, Maryland courts engage in a ‘pro rata by time-on-the-risk allocation’ of liability.” Pennsylvania Nat’l Mut. Cas.

Ins. Co. v. Roberts, 668 F.3d 106, 113 (4th Cir. 2012) (citing Maryland Cas. Co. v. Hanson, 169 Md. App. at 512 ; Riley v. United Servs. Auto.

Ass’n, 161 Md. App. at 592 ; In re Wallace & Gale Co., 385 F.3d 820, 835 (4th Cir. 2004)). “Under this method of allocation, ‘[e]ach insurer is liable for that period of time it was on the risk compared to the entire period during which damages occurred[.]’” Id. (quoting Mayor & City Council of Baltimore v. Utica Mut. Ins. Co., 145 Md. App. at 313 (further citation omitted).

As previously explained, the calculation of an insurer’s pro rata share of the judgment based on its time on the risk requires a court to identify a numerator (representing the time on the risk) and a denominator (representing the period in which the injured person suffered bodily injury). 17 B. “All Sums” Before we proceed to review the circuit court’s calculation of Penn National’s pro rata share of the judgments based on its time on the risk, we must consider the Jeffers children’s contention that we should employ an entirely different method to compute Penn National’s liability. Relying principally on Keene Corp. v. Insurance Co. of North America, 667 F.2d 1034 (D.C. Cir. 1981), the children argue that because Penn National agreed to pay “those sums” that Levitas became “legally obligated to pay as damages because of ‘bodily injury,’” Penn National must indemnify Levitas for the entire amount of the judgments against him (and thus must pay them the entire amount of the judgments). Penn National could then attempt to reduce its liability by pursuing claims of contribution against any other insurers that might have an obligation to indemnify Levitas or any tortfeasors who might be jointly and severally liable with Levitas for the judgments. The short answer to the children’s contention is that this Court rejected it in 2002 in Utica Mutual, because it is inconsistent with the language of the CGL policy.

See Mayor & City Council of Baltimore v. Utica Mut. Ins. Co., 145 Md. App. at 310-11 . In a CGL policy, like the Penn National policy in this case, an insurer does not make an unqualified promise to pay all sums that its insured becomes legally obligated to pay as damages because of bodily injury.

Instead, the insurer agrees to pay those sums that the insured becomes legally obligated to pay because of bodily injury to which the insurance applies. By its terms, a CGL policy, like the Penn National policy in this case, applies only to bodily injury that occurs during the policy period. Id. at 312 . An insurer cannot 18 be required to indemnify its insured for an obligation that the insurer did not contractually agree to assume.

See Pennsylvania Nat’l Mut. Cas. Ins. Co. v. Roberts, 668 F.3d at 109 (stating that “an insurance company cannot be held liable for periods of risk it never contracted to cover”).

Consequently, in determining an insurer’s share of an insured’s liability when the triggering event occurs on a continuous basis over an extended period of time, the Utica Mutual Court held that the insurer is liable, at most, for its pro rata share of the judgment based on its time on the risk. See Mayor & City Council of Baltimore v. Utica Mut. Ins. Co., 145 Md. App. at 313 .9 Although the Court of Appeals has not reviewed the holding in Utica Mutual, this Court has repeatedly reaffirmed that decision.

Riley v. United Servs. Auto Ass’n, 161 Md. App. at 592 ; see also Maryland Cas. Co. v. Hanson, 169 Md. App. at 512 . Furthermore, the federal courts, applying Maryland law, have treated Utica Mutual as settled law.

See, e.g., Pennsylvania Nat’l Mut. Cas. Ins. Co. v. Roberts, 668 F.3d at 112 ; In re Wallace & Gale Co., 385 F.3d 820 , 833 (4th Cir. 2003); Allstate Ins.

Co. v. Rochkind, 381 F. Supp. 3d 488, 511 (D. Md. 2019). In these circumstances, we decline to employ any allocation formula other than the insurer’s pro rata share of the judgment based on its time on the risk. C. The Denominator in This Case Penn National raises two objections to the circuit court’s computation of the denominator (i.e., the period in which the Jeffers children experienced bodily injury). 9 We say “at most” because the insurer’s liability is always subject to the definitions, conditions, and exclusions in its policy. 19 Penn National asserts, first, that the court erred in determining that the bodily injury ended as soon as the children moved out of 2116 Hollins Street despite the elevated blood-lead levels that they continued to experience for some time thereafter. Second, Penn National asserts that the court erred in excluding the bodily injury that Tajah Jeffers had suffered before she moved into 2116 Hollins Street, as evidenced by her elevated blood-lead levels from that period.

We agree that the court erred in both respects. 1. In their case against Levitas, the Jeffers children introduced evidence, through their expert, Dr. Charlene Sweeney, that they continued to suffer bodily injury after they moved out of 2116 Hollins Street. The injuries, which were evidenced by their elevated blood-lead levels, resulted from their previous exposure to lead at 2116 Hollins Street. But although that exposure had ended, the injury continued, because the children still had blood-lead levels that were sufficiently elevated to continue to cause damage at a cellular level.

This Court has recognized that “each elevated level indicates a bodily injury.” Maryland Cas. Co. v. Hanson, 169 Md. App. at 518 . Therefore, because the Jeffers children continued to have elevated blood-lead levels for some time after they moved out of 2116 Hollins Street, the court erred in failing to recognize that they continued to suffer bodily injury during that time. It follows that the court erred in rejecting Penn National’s computations regarding the dates when the children’s bodily injury ended: the court should have concluded that the bodily injury ended, at the earliest, as of the date of their 20 last elevated blood-lead levels (June 2, 1998, for Tajah Jeffers, and November 25, 1998, for Tynae Jeffers).10 The children assert that there is no evidence of their injurious exposure to lead after they moved out of 2116 Hollins Street.

Their assertion is accurate, but immaterial. Levitas was liable in tort for the damages that the children continued to suffer even after they moved out of his property. Penn National, however, has no obligation to indemnify Levitas for that portion of the judgment, because the bodily injury did not occur within the Penn National policy period: The question before us . . . is not whether [Levitas] is liable for the entire . . . judgment, but whether Penn National is. And that question can be answered only by reference to the insurance contract, which necessarily involves the application of contract law.

Pennsylvania Nat’l Mut. Cas. Ins. Co. v. Roberts, 668 F.3d at 114 .

To the extent that Levitas had insurance coverage against claims of bodily injury suffered after the Jeffers children moved out of 2116 Hollins Street (as he did with the CNA Reinsurance policy), the children could look to that coverage in satisfaction of their judgments. To the extent that the bodily injury occurred after the Penn National policy ended, however, Penn National has no liability, because an “insurance company cannot be held liable for periods of risk it never contracted to cover.” Id. at 109 ; id. at 112 (holding that, because the CGL policy provides coverage only for bodily injury that 10 The children probably continued to suffer bodily injury even after their last elevated blood-lead levels, until they had eliminated more of the lead that had accumulated in their bodies during their residency at 2116 Hollins Street. Penn National, however, has not argued for a date later than that of the last elevated blood-lead levels. 21 occurs during the policy period, the policy, “[b]y its own terms,” does not “cover damages [the insured] became legally obligated to pay for injuries that occurred outside of the policy period”). The circuit court, therefore, erred in ruling that the children’s bodily injury ended when they moved out of the Levitas property on March 26, 1998, and not at the time of their last elevated blood-lead levels (June 2, 1998, for Tajah Jeffers, and November 25, 1998, for Tynae Jeffers).

In reaching its erroneous decision, the circuit court seemed to rely on the Jeffers children’s contention that Levitas was held liable only for the injuries that the children suffered at that residence. The children find evidence for that contention in the verdict sheet, in which the jury found that Levitas “was negligent with respect to the property known as 2116 Hollins Street” and imposed damages on account of that negligence. But to say that Levitas “was negligent with respect to the property known as 2116 Hollins Street” is not to say that the award of damages was somehow limited to the quantum of injury that the children suffered while they were living at that