EMPLOYERS INSURANCE OF WAUSAU, A MUTUAL COMPANY, a Wisconsin mutual company, Plaintiff-Appellant Cross-Respondent, v. TEKTRONIX, INC., an Oregon corporation, Defendant-Respondent Cross-Appellant, and CONTINENTAL CASUALTY COMPANY, an Illinois corporation; TRAVELERS INDEMNITY COMPANY, a Connecticut corporation; AETNA CASUALTY AND SURETY COMPANY, a Connecticut corporation; GRANITE STATE INSURANCE COMPANY, a New Hampshire corporation; NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA, a Pennsylvania corporation; CERTAIN UNDERWRITERS AT LLOYD'S LONDON; CERTAIN UNDERWRITING SYNDICATES AT LLOYD'S LONDON; and DOES 1-100, inclusive, Defendants. TEKTRONIX, INC., an Oregon corporation, Third-Party Plaintiff, v. AETNA CASUALTY & SURETY COMPANY, a Connecticut corporation; AIU INSURANCE COMPANY, a New York corporation; CENTURY INDEMNITY COMPANY, a Pennsylvania corporation; CENTRAL NATIONAL INSURANCE COMPANY OF OMAHA, a Nebraska corporation; CERTAIN LONDON MARKET INSURANCE COMPANIES, foreign corporations; EQUITAS REINSURANCE LIMITED, a foreign corporation; EQUITAS LIMITED, a foreign corporation; EQUITAS HOLDINGS LIMITED, a foreign corporation; EQUITAS MANAGEMENT SERVICES, a foreign corporation; EQUITAS POLICYHOLDERS TRUST LIMITED, a foreign corporation; GRANITE STATE INSURANCE COMPANY, a New Hampshire corporation; HIGHLANDS INSURANCE COMPANY, a Texas corporation; INSURANCE COMPANY OF THE STATE OF PENNSYLVANIA, a Pennsylvania corporation; NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA., a Pennsylvania corporation; OREGON INSURANCE GUARANTY ASSOCIATION, an Oregon association; and TRAVELERS INDEMNITY COMPANY, a Connecticut corporation, Third-Party Defendants., 211 Ore. App. 485

Summary

The insurer argued, inter alia, that the trial court erred in assigning to it the burden of proving the application of the "sudden and accidental" exception to the policy's pollution exclusion. The court of appeals agreed. The insurer requested a jury instruction that would have allocated to the facility the burden of proving that each "discharge, dispersal, release, or escape" was sudden and accidental. The trial court rejected the instruction, and erred in that regard. Facts regarding an unintended and unexpected discharge were within the peculiar knowledge of the facility, and policy considerations supported additional incentives for detecting and preventing "sudden and accidental" discharges, dispersals, releases, and escapes. The facility was better able to prove the suddenness than the insurer would have been able to prove its absence. The facility sought the benefit of the exception to the pollution exclusion. It was appropriate that the facility bear the burden of proving that ...