Ludington Holiday Inn case sent back to lower court to address fees owed by AutoOwners

Earlier on this website, we reported on litigation involving the Ludington Holiday Inn, where a family suffered a toxic exposure as a result of a problem with the heating system.  AutoOwners insured the Inn but refused to defend the injury claims against the Inn, arguing that they fell within an exclusion for injuries caused by pollution.  The trial court rejected that argument, and enforced an exception for "heating equipment" in the policy language applicable to the pollution exclusion. The lower court also awarded the Inn and the injured family significant attorneys fees and costs. 

The Court of Appeals reversed the trial court and held that since the policy language was ambiguous, the coverage issue should have been submitted to the jury for decision.  This week, the Supreme Court unanimously overturned the Court of Appeals decision, holding that the language of coverage in the policy was unambiguous and that Auto Owners had no reasonable  basis to argue against coverage.  Nevertheless, it returned the case to the appellate court for consideration of the trial court's award of fees and costs against Auto Owners.