City of Edgerton v. General Cas. Co

In City of Edgerton v. General Cas. Co., 184 Wis. 2d 750, 517 N.W.2d 463 (1994), which involved identical policy language, our supreme court held that, "'damages' as used in ... insurance policies unambiguously means legal damages. It is legal compensation for past wrongs or injuries and is generally pecuniary in nature. The term 'damages' does not encompass the cost of complying with an injunctive decree." Edgerton, 184 Wis. 2d at 783. The Edgerton court noted that remediation and response costs assigned under CERCLA and equivalent state statutes are, "by definition, considered to be equitable relief." 184 Wis. 2d at 784. The court further noted: "As an equitable form of relief, response costs were not designed to compensate for past wrongs; rather, they were intended to deter any future contamination by means of injunctive action, while providing for remediation and cleanup of the affected site. This type of relief is distinct from that which is substitutionary-monetary compensation provided to make up for a claimed loss." 184 Wis. 2d at 785.