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Foster-Gardner Inc. v. National Union Fire Insurance Co.8/3/1998
adequate remedy in the form of reimbursement." (Id. at p. 840.) " njunctive relief is an equivalent substitute for the goal of government remedial action." (Ibid.) "For these reasons, it would exalt form over substance to interpret CGL policies to cover one remedy but not the other. Given the practical similarity of remedies available under the environmental statutes at issue here, we believe a reasonable insured would expect both remedies to fall within coverage as `damages.' " (Ibid.)
Here, however, we perceive no elimination in the HSAA of the formal distinction between a "suit" and "claim " which do not rise to the level of a suit. Under section 25358.3, the DTSC is authorized to issue an Order or to " equest the Attorney General to secure the relief as may be necessary to abate the danger or threat" in the superior court in the county in which "the threat or danger occurs." (§ 25358.3, subd. (a)(1) & (3), as amended by Stats. 1989, ch. 1032, § 21, pp. 3576-3577; see § 25358.3, subd. (a)(1) & (3); see id., subds. (e), (g).) Moreover, to compel a party to repay its expended costs, the DTSC must file a lawsuit in court. (§ 25360, subds. (a), (c), see id., former subds. (a) & (d), as amended by Stats. 1989, ch. 269, § 40, p. 1338; see AIU, supra, 51 Cal.3d at pp. 815-816.) Thus, the HSAA itself clearly distinguishes between the issuance of an Order and the institution of a civil lawsuit. (See Ray Industries Inc. v. Liberty Mutual Ins. Co., supra, 974 F.2d at p. 762 ["CERCLA itself recognizes a distinction between lawsuits and PRP notice letters. . . . the EPA has express authority to file a lawsuit . . .; it has simply chosen not to do so in this case."]; Harleysville Mutual Ins. Co. v. Sussex County, supra, 831 F.Supp. at p. 1132 ["Recognizing the difference in these approaches provides a clear line of demarcation between situations that do and do not trigger the insurer's duty to defend."].)
Foster-Gardner also argues that because under AIU, response costs are "damages" within the coverage of the policies, and the Order is the "proceeding" in which Foster-Gardner's liability for these damages will be determined subject only to review by a trial court, then the insurers have a duty to defend. However, as we have already stated, an insurer does not have a duty to defend each and every proceeding in which there is a potential covered damages or any other factual predicate will be ascertained. Rather, it has a duty to defend a suit whenever there is potential coverage. (Gray v. Zurich Insurance Co., supra, 65 Cal.2d at p. 268, italics added ["the duty to defend arises only if the third party suit involves a liability for which the insurer would be required to indemnify the insured"]; Montrose Chemical Corp. of Calif. v. Superior Court, supra, 6 Cal.4th at p. 299.)
Moreover, in AIU, we did not conclude that cleanup costs ordered by a state agency prior to any civil suit being filed are "damages." Rather, the proceedings in AIU in which "damages" were sought were civil actions, not administrative proceedings. (AIU, supra, 51 Cal.3d at p. 815 [the "United States and local administrative agencies . . . filed suits against FMC, seeking relief for alleged violations of CERCLA" and the HSAA]; id. at p. 816 ["FMC seeks declaratory relief establishing that the CGL policies cover costs it may become obligated to pay as a result of injunctive relief and/or reimbursement ordered in the third party suits."].) We did not hold that an insurer has a duty to defend when no such suit has been filed. As Fireman's Fund observed, "AIU's holding -- that there is coverage for certain damages sought in a third party suit prosecuted by the EPA under CERCLA -- has nothing to do with whether the carri
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