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January 8, 1987


Thomas A. Flannery, United States District Judge.

The opinion of the court was delivered by: FLANNERY


 This matter came before the court on the Motion for Partial Summary Judgment of defendant Insurance Company of North America ("INA"), originally filed on March 14, 1986, and supplemented on May 19, 1986, and on plaintiff's cross motion for Partial Summary Judgment against INA.

 I. Background

 This action arises out of a series of sprayings by agents of plaintiff Independent Petrochemical Corp. ("IPC") of petroleum products allegedly contaminated with dioxin, a hazardous waste. These sprayings occurred in Missouri in the early 1970's. Plaintiffs IPC and its parent companies, The Charter Company ("TCC") and Charter Oil Company ("COC"), brought this action against their insurers from the period 1971 to the present, seeking indemnification and defense from some 60 actions filed against plaintiffs in Missouri state courts. A more detailed exposition of the background of this case may be found in this court's February 4, 1986 Memorandum. See IPC v. Aetna, 654 F. Supp. 1334, mem. at 1-4 (D.D.C. 1986) ("February 4 Opinion").

 In a prior ruling, this court held that Missouri law governs the trigger-of-coverage issue, see IPC v. Aetna, No. 83-3347, Order and Declaration at 1 (D.D.C. May 2, 1986) ("May 2 Opinion"), and that the applicable trigger-of-coverage is the time, determined retrospectively, when the effects of exposure to dioxin negligently released by plaintiffs actually resulted in an injury in fact to one of the underlying dioxin-related claimants. Id. slip op. at 2; IPC v. Aetna, 672 F. Supp. 1, mem. at 3 (D.D.C. 1986) ("August 8 Opinion"). The court further held that:

Notwithstanding defendants' duty to indemnify, any defendant primary insurance carrier is not obligated to indemnify plaintiffs if it can demonstrate upon motion that its insurance policy does not apply to the underlying dioxin-related claims because of some conduct on the part of plaintiffs (such as fraud or lack of notice) or some exclusion provision of the policy.

 May 2 Opinion at 2. INA seeks to show precisely this in the Motion for Partial Summary Judgment now before the court.

 II. INA's Motion for Partial Summary Judgment

 INA contends that in the fall of 1980 plaintiffs entered into negotiations with INA to obtain a primary general liability policy. According to INA, plaintiffs failed to disclose to INA the existence of several dioxin-related cases that had been filed between 1974 and 1979. INA states that it had no independent knowledge of these actions, some of which had settled, and one of which sought damages of $ 14 million. See INA's Statement of Material Facts as to Which There is No Genuine Issue, paras. 3, 5. INA contends that this nondisclosure by plaintiff was as a matter of law material to INA's decision to insure plaintiff for the risks for which plaintiff now seeks indemnification, and that this compels the court to enter summary judgment in favor of INA as to the policies it issued to plaintiff between 1981 and 1983.

 A. Choice of Law :

 As a threshold matter, INA contends that Florida law controls the issue of nondisclosure and its consequences, and that plaintiffs do not dispute the applicability of Florida law to this issue. INA Reply Memorandum at 16-17. As stated in this court's May 2 Opinion, "the local law of the state which has the 'more substantial interest' in the resolution of an issue must be applied" under the choice of law rules of the District of Columbia. May 2 Opinion at 13, n. 10, citing Lee v. Flintkote, 193 U.S. App. D.C. 121, 593 F.2d 1275, 1279 n. 16 (D.C. Cir. 1979); Clayman v. Goodman Properties, Inc., 171 U.S. App. D.C. 88, 518 F.2d 1026, 1030 n. 22 (D.C. Cir. 1973); Fowler v. A & A Co., 262 A.2d 344 (D.C. 1970); Stevens v. American Serv. Mut. Ins. Co., 234 A.2d 305, 309 (D.C. 1967).

 Courts are not bound to decide all issues under the local law of a single state; rather, each issue is to receive separate consideration. See Restatement (2d) of Conflicts of Law § 188 (1971). Thus, the fact that Missouri law controls the trigger-of-coverage issue is of no significance to this separate question. Unlike the trigger-of-coverage issue, as to which the location of the insured risk was deemed paramount, see May 2 Opinion at 15-16, the issue of nondisclosure in negotiating and forming a contract is appropriately resolved according to the law of the state in which negotiations took place and the contract was formed. This is so because in weighing the five factors which a court must consider in resolving choice of law problems, the place of contracting and the place of negotiation of the contract emerge as far more significant than the place of performance, location of the subject matter of the contract, or place of business of the parties. See Koro Co., Inc. v. Bristol Myers Co., 568 F. Supp. 280, 286 (D.D.C. 1983), citing Restatement (2d) of Conflict of Law § 188 (1971). Florida, the state in which negotiation and formation occurred, has the most substantial interest in seeing its laws applied to the conduct of parties negotiating for insurance in its jurisdiction.

 This is especially so where, as here, the Florida statute seeks to protect its insurers from liability for claims as to which the insured failed to disclose material facts. The relevant Florida statute provides:

(1) All statements and descriptions in any application for an insurance policy or annuity contract, or in negotiations therefor, by or on behalf of the insured or annuitant, shall be deemed to be representations and not warranties. Misrepresentations, omissions, concealment of facts, and incorrect ...

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