             United States Court of Appeals
                        For the First Circuit

No. 07-1452

                          BOSTON GAS COMPANY,
                    d/b/a KEYSPAN ENERGY DELIVERY,

                         Plaintiff, Appellee,

                                     v.

                      CENTURY INDEMNITY COMPANY,

                         Defendant, Appellant.
                               __________

                 CERTAIN UNDERWRITERS AT LLOYD'S LONDON;
               CERTAIN LONDON MARKET INSURANCE COMPANIES;
                  TRAVELERS CASUALTY AND SURETY COMPANY;
         ASSOCIATED ELECTRIC & GAS INSURANCE SERVICES LIMITED;
                     AETNA CASUALTY & SURETY COMPANY;
                      THE HARTFORD INSURANCE COMPANY,

                        Third-Party Defendants.


             APPEAL FROM THE UNITED STATES DISTRICT COURT

                   FOR THE DISTRICT OF MASSACHUSETTS

               [Hon. Rya W. Zobel,    U.S. District Judge]



                                Before

                          Boudin, Chief Judge,

                     Selya, Senior Circuit Judge,

                      and Gelpi,* District Judge.




     *
         Of the District of Puerto Rico, sitting by designation.
     Guy A. Cellucci with whom Shane R. Heskin, White & Williams
LLP, David B. Chaffin and Hare & Chaffin were on brief for
appellant.
     David L. Elkind with whom John A. Gibbons and Dickstein
Shapiro LLP were on brief for appellee.
     William G. Passannante, Eugene R. Anderson, Anderson Kill &
Olick, P.C., Amy Bach and Law Offices of Amy Bach on brief for
United Policyholders, Amicus Curiae.
     Robert J. Gilbert and Gilbert & Renton LLC on brief for
Invensys Systems, Inc., Amicus Curiae.



                         June 10, 2008
              BOUDIN, Chief Judge.      This is a dispute between Boston

Gas Company ("Boston Gas"), the largest provider of natural gas in

the New England area, and one of its insurers, Century Indemnity

Company ("Century").        Before natural gas became the primary source

of   energy     in   New   England,   Boston   Gas   produced   gas   fuel    at

facilities called manufactured gas plants, known in the industry as

"MGPs".       These MGPs created gas by heating coal in large ovens,

generating gas which was then purified and piped out for use.

              This process also produced a variety of byproducts,

including ash, drip oil, tar and coke.          Many are non-biodegradable

and some are deemed carcinogenic, and they now contaminate the

ground and water around many former MGP sites; further, MGPs were

often sited near waterways which were contaminated in turn.1                 See

EnergyNorth Natural Gas, Inc. v. Century Indem. Co., 452 F.3d 44,

46-47 (1st Cir. 2006).           Contamination has been discovered at

twenty-nine former Boston Gas MGPs; this case concerns only one of

those sites, located in Everett, Massachusetts.

              Boston Gas operated the Everett MGP from 1908 until

approximately 1969; the MGP produced manufactured gas and also

processed coke oven gas purchased from a nearby coke plant.                   In

1995,     a   routine   investigation   uncovered    contamination     at    the


      1
      The main contaminant in this case was tar--the chief liquid
byproduct of manufactured gas production. At nearly all MGP sites
some tar escaped confinement and leaked into the environment; once
that leakage occurs, tar tends to migrate and to contaminate soils
and groundwater beyond the borders of the facility's site.

                                       -3-
Everett site.   Although the Everett site had been sold to a new

owner (DOMAC, LLC) in 1970, Boston Gas was nevertheless strictly

liable under Massachusetts law for all costs associated with the

investigation and cleanup of the contamination caused by the MGP's

operations.

           Boston    Gas   had    purchased   three    general   commercial

liability insurance policies from Century covering the period from

December 1, 1951, through December 1, 1969.           Each policy contained

a self-insured retention ("SIR")--essentially a deductible--of

$100,000 for each occurrence resulting in personal injury or

property   damage.     Above     the   deductible   amount,   the   policies

provided that Century would cover Boston Gas' "ultimate net loss"

up to the applicable limits of the policies for any liabilities

stemming from bodily injury, property damage, or other harm caused

by an "occurrence."    An "occurrence," said the policies, was

           an accident, including injurious exposure to
           conditions, which results, during the policy
           period, in property damage neither expected
           nor intended from the standpoint of the
           [i]nsured.

           After Boston Gas investigated and began to clean up the

contaminated soils and groundwater at and near the Everett site,

Boston Gas warned Century that it might seek indemnification.

Century "reserved its rights," and on October 22, 2002, Boston Gas

filed a diversity law suit against Century in the federal district

court, seeking a declaratory judgment as to Century's obligations


                                       -4-
under the policies and damages for its breach thereof.   A three-

week long jury trial followed, focusing upon the Everett site.2

          Boston Gas argued in the district court that to recover

under the policies, it needed to prove only that an occurrence had

caused some off-site property damage during the policy periods--

off-site because the policy had an "owned property" exclusion for

damage to Boston Gas' own property.   Off-site damage, in Boston

Gas' view, required Century to indemnify Boston Gas for all its

liabilities connected to the occurrence.   Century responded that

various exclusions contained in the policies precluded or limited

indemnification.

          Importantly, Century argued that Boston Gas was well

aware by 1951 that pollution from the Everett MGP was causing

property damage at or near the site; the costs were therefore

barred by an exclusion requiring that the property damage be

"neither expected nor intended" by the insured.      Century also

argued that Boston Gas improperly sought to recover costs expended

to repair and improve the Everett site itself, rather than to

remediate or prevent off-site property damage.

          At trial, the jury awarded Boston Gas over $6.1 million

in past remediation expenses; the district court also issued a



     2
      The other twenty-eight Boston Gas MGPs remain the subject of
a larger dispute. Boston Gas intends to use the outcome of the
Everett trial as an exemplar to establish its rights against
Century with respect to the other sites.

                               -5-
declaratory judgment obligating Century to pay all future costs

associated with the investigation and environmental cleanup of the

Everett site.     Century now appeals on multiple grounds from the

district court's judgment.      As usual, the standard of review

depends on the issue.    Indianapolis Life Ins. Co. v. Herman, 516

F.3d 5, 8 (1st Cir. 2008).

          Allocation among insurers.   Century's most far-reaching

claim is that the district court should have limited Century's

liability by allocating Boston Gas' liabilities among all insurers

from whom Boston Gas had purchased general commercial liability

insurance during the Everett MGP's lifespan.      Century insured

Boston Gas under various policies from 1951-1969,3     while other

insurers covered Boston Gas during other periods of its century-

long operation.

          Century does not now dispute the jury's finding that the

Everett site suffered contamination during the 1951-1969 time

period.   Indeed, contamination seemingly occurred over a much

longer period, even though no findings were made as to duration.

Rather, renewing an argument made in the district court, Century

says that manifestly not all of the damage could have been caused


     3
      The terms of the policies varied. The 1960-66 policy had a
per occurrence limit of $1 million and a SIR of $100,000.      The
1966-69 policy contained a limit of $17 million and a SIR of
$100,000. The 1951-60 policy was lost, but the jury found that the
policy had a $1 million policy limit in 1951 and from 1955-1960,
and a limit of $500,000 from 1952-1954. The jury did not determine
the lost policy's self-insured retention limits.

                                -6-
during its limited period of insurance and its liability should be

no more than its proportionate share.    It also urges that its share

should be spread among its various policy years.4

             The district court instead applied a method of allocation

referred to in the doctrine as the joint and several, or "all

sums," approach and permitted Boston Gas to recover from Century

its total clean-up liability--subject only to the SIR and policy

limit--under any one of its policies in place between 1951 and

1969.      Not surprisingly, Boston Gas selected the policy with the

highest coverage limit--$17 million--and Century was held fully

liable for $6,227,327.90 in damages, less that policy's $100,000

SIR.

               On appeal, arguing for pro rata allocation, Century

highlights the policy language--the underscoring is ours--defining

an occurrence as "an accident . . . which results, during the

policy period, in property damage."       It asserts that it is not

responsible for damage that occurred outside of the policy period,

so proration among insurers is required.     Boston Gas counters that

the policy says nothing about proration, so given an occurrence--

which includes "continuous or repeated exposure to substantially



       4
      In substance Century wants any award reduced by its policies'
self-insured retention of $100,000 for each year of contamination,
arguing that this approach is consistent with Massachusetts'
requirement that an insured exhaust all available underlying
primary insurance.      A.W. Chesterton Co. v. Mass. Insurers
Insolvency Fund, 838 N.E.2d 1237, 1254 (Mass. 2005).

                                  -7-
the same general conditions"--within the policy period, Century is

liable for the "'ultimate net loss' mean[ing] the sum actually paid

or payable" by the insured.

           This   dispute    commonly   arises    in   the   context    of

environmental damage and toxic exposure disputes--so-called "long-

tail" indivisible injuries attributable to ongoing events without

a single clear "cause."     See Russ & Segalla, 15 Couch on Insurance

§ 220:25 (3d ed. 2007).     The language of traditional comprehensive

general liability policies--drafted before such law suits became

common--does not neatly map onto these types of injuries.        Hickman

& DeYoung, Allocation of Environmental Cleanup Liability Between

Successive Insurers, 17 N. Ky. L. Rev. 291, 292 (1990).

           Competing methods have emerged.       Some courts have deemed

insurers fully liable--normally, jointly and severally--for all

damages attributable to an occurrence, exposure or contamination

that happened at least in part during the coverage period.             See

Keene Corp. v. Ins. Co. of N. Am., 667 F.2d 1034, 1050 (D.C. Cir.

1981). Others have prorated an insurer's liability, based largely,

but not always exclusively, on the number of years during which

coverage was offered.       See Ins. Co. of N. Am. v. Forty-Eight

Insulations, Inc., 633 F.2d 1212, 1224-25 (6th Cir. 1980); Owens-

Illinois, Inc. v. United Ins. Co., 650 A.2d 974, 993-94 (N.J.

1994).   The parties agree that Massachusetts law governs here.




                                  -8-
            Unfortunately, the Massachusetts Supreme Judicial Court

has not yet resolved this allocation question, A.W. Chesterton Co.

v. Mass. Insurers Insolvency Fund, 838 N.E.2d 1237, 1242 n.3 (Mass.

2005) (expressly reserving the issue), so our choices are two: we

can make our best guess on this de novo review issue, or we can

certify the question and ancillary issues to the SJC.               The first

path offers the benefit of expedition but with a risk of error; the

second path, the reverse.5

            Although    there   is    one   Massachusetts   Appeals     Court

decision on point, its treatment of the choice between the two

allocation methods is cursory.         Rubenstein v. Royal Ins. Co. of

Am., 694 N.E.2d 381, 388 (Mass. App. Ct. 1998); see also Chicago

Bridge & Iron Co. v. Certain Underwriters at Lloyd's, London, 797

N.E.2d 434, 441-45 (Mass. App. Ct. 2003) (adopting joint and

several allocation, but as a matter of Illinois law).             Nor is there

a   clear   consensus   among   the    states   as   to   which    method   is

preferable. A growing plurality have adopted some form of pro rata




      5
      Century sought certification of the allocation question
before the district court.     The district court stated that it
believed itself to be "compel[led]" by Rubenstein v. Royal
Insurance Co. of America, 694 N.E.2d 381, 388 (Mass. App. Ct.
1998), to adopt the joint-and-several approach, but based its
denial of the motion on the fact that the allocation question was
not   outcome   determinative.   See   Mass.  S.J.C.  Rule   1:03
(certification appropriate only when the disputed question of law
"may be determinative of the cause").

                                      -9-
allocation,6 but a significant number of courts impose joint and

several allocation.7

            Nor   do     policy   arguments   line    up   solely behind one

solution.    At first blush it may seem illogical to hold a single

insurer, who may have only covered the insured for a single year,

fully liable for the costs of environmental damage that may have

accrued over the course of a century.           But that insurer can seek

contribution      from    other   insurers    "on    the   risk"   during   the

contamination period.        See, e.g., Goodyear Tire & Rubber Co. v.

Aetna Cas. & Sur. Co., 769 N.E.2d 835, 841 (Ohio 2002).               And the

alternative may force the insured to sue numerous companies in one

suit, if this is possible at all, to avoid inconsistencies.




     6
      See EnergyNorth Natural Gas, Inc. v. Certain Underwriters at
Lloyd's, 934 A.2d 517, 526 (N.H. 2007); Aetna Cas. & Sur. Co. v.
Commonwealth of Kentucky, 179 S.W.3d 830, 842 (Ky. 2005); Sec. Ins.
Co. of Hartford v. Lumbermens Mut. Cas. Co., 826 A.2d 107, 121
(Conn. 2003); Atchison, Topeka & Santa Fe Ry. Co. v. Stonewall Ins.
Co., 71 P.3d 1097, 1134 (Kan. 2003); Consol. Edison Co. of N.Y. v.
Allstate Ins. Co., 774 N.E.2d 687, 695 (N.Y. 2002); Pub. Serv. Co.
of Colo. v. Wallis & Cos., 986 P.2d 924, 935 (Colo. 1999); Domtar,
Inc. v. Niagara Fire Ins. Co., 563 N.W.2d 724, 732 (Minn. 1997);
Sharon Steel Corp. v. Aetna Cas. & Sur. Co., 931 P.2d 127, 140-42
(Utah 1997); Owens-Illinois, 650 A.2d at 993-94.
     7
      See Goodyear Tire & Rubber Co. v. Aetna Cas. & Sur. Co., 769
N.E.2d 835, 841-42 (Ohio 2002); Hercules, Inc. v. AIU Ins. Co., 784
A.2d 481, 494 (Del. 2001); Allstate Ins. Co. v. Dana Corp., 759
N.E.2d 1049, 1058 (Ind. 2001); Am. Nat'l Fire Ins. Co. v. B & L
Trucking & Constr. Co., 951 P.2d 250, 256-57 (Wash. 1998); J.H.
France Refractories Co. v. Allstate Ins. Co., 626 A.2d 502, 507-08
(Pa. 1993).


                                     -10-
            Either method forces courts to indulge in a probable

fiction as to when the event triggering coverage occurred. The pro

rata method assumes an ongoing occurrence causing stable amounts of

damage over time; the joint and several method pretends, even less

plausibly, that a single occurrence caused all the damage, and

allows the insured effectively to choose the year in which that

happened.    Both are crude approximations made under conditions of

uncertainty.

            Pro rata allocation is generally favored by insurers;

insureds    usually   prefer   joint   and   several   allocation   as   it

alleviates the need for multiple defendants and possibly multiple

lawsuits.    Yet in those jurisdictions that employ the joint and

several method, but limit the insured to making a claim against a

single policy--a method sometimes referred to as joint and several

allocation without stacking, Am. Physicians Ins. Exch. v. Garcia,

876 S.W.2d 842, 853-54 (Tex. 1994)--the insured may collect less

than it would have under pro rata allocation. Bratspies, Splitting

the Baby: Apportioning Environmental Liability Among Triggered

Insurance Policies, 1999 BYU L. Rev. 1215, 1258.

            Each method also has secondary implications, which courts

have variously viewed as more or less desirable.          One example is

so-called "orphan shares," i.e., damages attributable to years

during which the insured "went bare" or purchased coverage from a

now-insolvent insurer.     Pro rata allocation usually (although not


                                  -11-
inevitably) treats the insured as self-insuring for those years, a

result that some courts view (appropriately) as preventing a

windfall, EnergyNorth, 934 A.2d at 526; others as (inappropriately)

depriving the insured of expected protection.        Keene, 667 F.2d at

1048-49.     The two approaches also differ in the incentives they

create for settlements, in their tendency vel non to consolidate

litigation   in   one   case,   and   in   their   treatment   of    policy

deductibles and excess insurance policies.

           For example, under pro rata allocation, the insured will

seek coverage from each insurance policy in effect during the

contamination period and is likely to absorb the self-insurance

retentions of each policy, Pub. Serv. Co. of Colo. v. Wallis &

Cos., 986 P.2d 924, 941 (Colo. 1999), while excess insurance

policies offering coverage only for damages above that prorated

amount will not be triggered. By contrast, under joint and several

liability all damages are attributable to a single year; ordinarily

the insured is responsible for a single deductible and, given the

large sums ordinarily sought, it becomes more likely that excess

insurance will be activated.

           That a legal issue is close or difficult is not normally

enough to warrant certification, or else diversity cases would

regularly require appellate proceedings in two courts.              But the

dollar amounts involved in this and the follow-on cases for other

sites are very large (see note 2, above); and the allocation method


                                  -12-
could easily matter in future cases not involving these parties.

Although Massachusetts judicial policy is often favorable to the

insured, at least in consumer cases, sister courts in New York, New

Hampshire and Connecticut have adopted the pro rata approach.   See

note 6, above.

          Perhaps the strongest argument for certification is that

even within the two broad schools of thought, there are additional

nuances complicating any prediction by us of Massachusetts law.

For instance, in joint and several allocation courts divide on

whether an insured is allowed to "stack" multiple policies to

obtain coverage for all their damages; for pro rata allocation,

some courts allocate damages based purely upon the number of years

of coverage, while others allocate based on both years and amounts

of coverage offered.8

          Because we have found no controlling SJC precedent on the

allocation question and the issue is determinative of the scope of

Boston Gas' claim, we will certify the questions set forth at the




     8
      Compare Keene, 667 F.2d at 1049 (allowing insured to seek
coverage only under a single policy), with J.H. France, 626 A.2d at
509 (adopting joint and several allocation with stacking), and
compare Pub. Serv. Co. of Colorado, 986 P.2d at 942 (proration by
years), with Owens-Illinois, 650 A.2d at 993 (proration by years
and   limits).   See  Gillespie,    The  Allocation   of   Coverage
Responsibility Among Multiple Triggered Commercial General
Liability Policies in Environmental Cases: Life After Owens-
Illinois, 15 Va. Envtl. L.J. 525, 535 (1996) (listing various
permutations of the pro rata and joint several allocation methods).

                               -13-
close of this decision to the Massachusetts Supreme Judicial Court

in accordance with Mass. S.J.C. Rule 1:03.

            Apportionment of recoverable costs.        We now turn to a

connected pair of issues: Century's claim that the district court

failed properly to instruct on the "owned-property exclusion"

contained   in   Century's   policies9   and   its   separate   claim   for

judgment as a matter of law as to costs incurred incident to

DOMAC's expansion project. The issues both relate to apportionment

between recoverable and unrecoverable costs and both relate in part

to the DOMAC construction.

            Review of the legal correctness of an instruction is de

novo, Cigna Ins. Co. v. Oy Saunatec, Ltd., 241 F.3d 1, 8 (1st Cir.

2001), with deference as to phrasing and emphasis, United States v.

Teemer, 394 F.3d 59, 63 n.2 (1st Cir. 2005).          On appeal from the

denial of a motion for judgment as a matter of law, the question

usually is whether, drawing all inferences in favor of the verdict,

the evidence permitted a reasonable jury to render a verdict

adverse to the moving party.    FHS Props. Ltd. P'ship v. BC Assocs.,

175 F.3d 81, 85 (1st Cir. 1999).




     9
      Boston Gas argues that claims of jury misinstruction were not
adequately preserved.    Having read the pertinent parts of the
record, we are satisfied that Century made its objections clear at
the charge conference, as required by Fed. R. Civ. Pro. 51(c) and
the case law. See Suprenant v. Rivas, 424 F.3d 5, 15 (1st Cir.
2005).

                                  -14-
            Each of the policies Boston Gas purchased from Century

contained a clause stating that "[t]his policy does not apply . .

. to property damage to . . . property owned by the [i]nsured."

Such clauses--like other exclusions--provide the insurer with an

affirmative defense to liability, placing the burden on the insurer

to exclude damage otherwise recoverable.         Allmerica Fin. Corp. v.

Certain Underwriters at Lloyd's, London, 871 N.E.2d 418, 425 (Mass.

2007).     However, this does not mean that costs of remediation of

the Everett site itself are automatically excluded.

            The   governing    Massachusetts    decision   on    the   owned-

property    exclusion   in    environmental    spill   cases    is   Hakim   v.

Massachusetts Insurers' Insolvency Fund, 675 N.E.2d 1161 (Mass.

1997).     There the court held that when pollutants have migrated

from the insured's property to an adjacent property--or perhaps

even when the threat of such migration is imminent--"coverage [to

remediate the insured's property] is not barred if the [on-site]

cleanup is designed to remediate, to prevent or to abate further

migration of contaminants to the off-site property."             Id. at 1164

& n.8 (emphasis added).10

            The special verdict form asked the jury: "Was the cost of

remediation at the Everett site incurred solely to clean up the


     10
      Accord Patz v. St. Paul Fire & Marine Ins. Co., 15 F.3d 699,
705 (7th Cir. 1994) (Wisconsin law); Intel Corp. v. Hartford
Accident & Indem. Co., 952 F.2d 1551, 1565-66 (9th Cir. 1991)
(California law); Gerrish Corp. v. Universal Underwriters Ins. Co.,
947 F.2d 1023, 1030-31 (2d Cir. 1991) (Vermont law).

                                    -15-
property of Boston Gas Company, as opposed to eliminating and/or

avoiding, at least in part, contamination of ground water or

adjacent property?"       A "yes" answer would have barred recovery; a

"no" answer--which the jury returned--required the jury to specify

"the amount Boston Gas Company has been legally obligated to pay

for the investigation and cleanup as a result of the property

damage at the Everett site caused during the years for which it had

coverage."

               Century correctly says that the special verdict form

(standing alone) could easily have led the jury to conclude that

once some of the on-site remediation was justified to cope with

actual    or    threatened   off-site   pollution,     all    of   the   on-site

remediation       costs   were   covered    by   the   policy.       The   oral

instructions suggest that this was likely not the intended result.11

But while an instruction might sometimes be so clear as to control

an ambiguous special verdict form, here the special verdict form

demanded an all-or-nothing award.

               Boston Gas says that it proved off-site contamination,

but this is not an answer to a claim that the special verdict

erroneously presented an all-or-nothing choice.              Under Hakim, some

off-site contamination does not automatically justify recovery of


     11
      The district court told the jury that "the plaintiff cannot
recover for any costs that were incurred solely to clean up its own
property." But other portions of the instructions--the district
court went on to characterize "the cleanup costs" as an indivisible
sum--cut the other way.

                                     -16-
all on-site remediation.       As Hakim explained: "The policy covers

cleanup costs incurred to remediate or prevent further migration of

the contaminants to the off-site waterways. Costs incurred for the

sole purpose of remediating the Hakims' property are barred by . .

. the policy."     Id. at 1165-66.

           Boston Gas also says that Century provided no evidence

that would have allowed the jury to determine that some of the on-

site costs were solely for the benefit of the site and not

necessary to prevent further off-site pollution.             Yet substantial

costs (Century says $3.5 million) were incurred to remove soils and

for other work incident to a project undertaken in 2000 by DOMAC to

expand its operations at the Everett site--or at least the jury

could have so found.      These costs are part of the award against

Century.

           For     example,    among   other      steps,     DOMAC   removed

contaminated soils and liquids from underground storage tanks--

these tanks were buried under the Everett site when DOMAC first

purchased the property in 1970--at a cost to Boston Gas (under a

sharing agreement with DOMAC) of around $1.6 million. Century says

that this was clearly done for the purpose of giving DOMAC a firm

foundation   for   its   own   facilities   and   not   as   remediation   or

prevention of further off-site damage.

           The fact that the jury verdict included the disputed

costs shows only that the jury believed that some costs targeted


                                   -17-
pollution that damaged or threatened off-site property. So we must

remand for a new trial on this issue.               This is a relatively narrow

issue, but the amounts are not trivial.                     In all events, the

principle is clear: only that remediation necessary to protect

against   off-site       contamination       is    compensable;    further   costs,

however useful to mitigate on-site contamination, are not.

             Century says that it should have been given judgment as

a   matter   of    law    as    to   a   portion    of   these   disputed    costs--

specifically, the $1.6 million allocated to the removal of the

contaminated soils.            Century argues, first, that the removal was

indisputably for the purpose of the DOMAC expansion project and

therefore excluded; and second, that the soil was contaminated by

underground       oil    only   after     DOMAC    purchased     the   property   and

Century's coverage ceased.               We are not persuaded that the issue

should have been taken from the jury.

             The "purpose" of the removal may, as Century claims, have

been to forward the DOMAC expansion; but the relevant question

under the policy and Hakim is whether the removal of that soil was

also objectively necessary because contaminants in the soil posed

a threat to off-site property as well.               Similarly, Century's claim

that this all occurred after its policy coverage ended in 1969 begs

the question; the covered "occurrence"--ongoing contamination--

began before and continued during and lasted until after Century's

period of coverage.


                                          -18-
            Century points to some evidence that the contamination of

the soil in the tanks occurred during the 1970 project; but Boston

Gas attacked the credibility of Century's expert witness, Richard

Meehan,    and    offered   evidence   that     the    tanks    may   have     been

contaminated at some earlier point and that contamination generally

had spread throughout the Everett site and beyond.              This is for the

jury to resolve.         Sailor Inc. F/V v. City of Rockland, 428 F.3d

348, 354 (1st Cir. 2005).

                 Exclusion of Charles Anderson's supplementary expert

report.    Century next argues that the district court erred in

precluding one of its expert witnesses, Charles Anderson, from

supplementing      his   expert   report    after     the   expiration    of   the

deadline for such responses as set by the district court.                The test

in such a case is abuse of discretion.                 Licciardi v. TIG Ins.

Group, 140 F.3d 357, 362-63 (1st Cir. 1998); see also Nat'l Hockey

League v. Metro. Hockey Club, Inc., 427 U.S. 639, 642 (1976) (per

curiam).

            In federal practice, an expert must ordinarily file a

report, Fed. R. Civ. P. 26(a)(2)(B), kept current by supplementary

reports if needed, id. 26(e)(2).           The trial judge typically sets a

schedule and may exclude non-complying evidence.               Id. 26(a)(2)(c);

Macaulay v. Anas, 321 F.3d 45, 50 (1st Cir. 2003).              Here,    November

30, 2004, was the deadline for the parties to serve reports

containing their experts' complete opinions.                The parties were to


                                     -19-
conclude expert depositions by April 1, 2005, file rebuttal reports

by April 22, 2005, and conduct rebuttal depositions by May 13,

2005.

            Pursuant to this timetable, Century produced Anderson's

report on November 29, 2004, and supplemented it with a report

filed on March 11, 2005.     Anderson was to serve as Century's expert

on the proper categorization of costs; Anderson attested that he

would categorize Boston Gas' site-related expenditures as "legal

costs, site investigation costs, remediation costs, and general

business expenditures"-- presumably to aid the jury in determining

which costs fell within Century's policy exclusions.

            On September 16, 2005--approximately two months before

trial was set to begin--Century produced a second supplemental

report from Anderson, which contained (in Century's view) essential

opinions    related   to    Century's     owned-property      defense.     For

instance, the report characterized certain expenses previously

categorized as "remediation" as necessary for on-site construction

activities but not remediation.          The new report also contained new

analysis of the costs Boston Gas had incurred in the removal and

disposal of the three underground storage tanks; Anderson planned

to   say   this   project   was   part    of   construction    activity,   not

remediation efforts.

            Boston    Gas   moved   to    strike Anderson's supplemental

report, complaining that Century sought to inject an entirely new


                                    -20-
theory of defense as to certain costs after the deadline for expert

reports.   Century answered that the tardy report was based on

information that Boston Gas had itself belatedly disclosed on

August   16,   2005;   this   data,   Century   claims,   was    previously

unavailable to Century.       The district court sided with Boston Gas

and excluded the new report, saying the report was a major change

and prior discovery available to Century undermined Century's

claimed lack of notice.

           From our vantage, this was a close call.             Century has

some basis for contesting Boston Gas' description of the reports as

reflecting a "sea change," and         Boston Gas could have asked to

depose Anderson on his new adjustments.            See Johnson v. H.K.

Webster, Inc., 775 F.2d 1, 8 (1st Cir. 1985).             But changes in

position shortly before trial complicate scheduling; the district

court's on-the-ground weighing of the factors has to be respected,

absent a clear abuse, Thibeault v. Square D Co., 960 F.2d 239, 244

(1st Cir. 1992); and we are not disposed in this case to override

its judgment.      If the limited new trial ordered changes the

calculus, that is a matter for the district court.

           Jury instructions on "expected or intended" defense.

Century's policy defines occurrence as "an accident, including

injurious exposure to conditions, which results, during the policy

period, in property damage neither expected nor intended from the

standpoint of the [i]nsured."          Massachusetts courts read such


                                   -21-
clauses as exclusions, with the insurer bearing the burden of

proof.   Quincy Mut. Fire Ins. Co. v. Abernathy, 469 N.E.2d 797, 800

(Mass. 1984); see also McGinnis v. Aetna Life & Cas. Co. 494 N.E.2d

1322 (Mass. 1986).       Placing the burden on Century, the district

court asked the jury on the special verdict form to decide:

           Did Boston Gas Company intentionally cause or
           know to a substantial certainty that it was
           causing contamination of soil and groundwater
           at the Everett site in one or more policy
           years?

           A "yes" answer to this question required the jury to

identify the year or years in which Boston Gas "intentionally

cause[d] or [knew] to a substantial certainty that it was causing

such   contamination."      But   the   jury   returned   a   "no"   answer,

rendering the exclusion inapplicable.          On appeal, Century objects

to the charge based on a remark made by the district court in

explaining its special questions to the jury.

           The remark was made by the district judge in seeking to

differentiate between the type of knowledge required by this

"expected/intended" exclusion and another "known loss" exclusion

that Massachusetts courts read into such policies; the latter is a

judicially created exclusion that prevents a policyholder from

recovering for losses from damage that it knew existed before

purchasing an insurance policy.         See SCA Servs. Inc. v. Transp.

Ins. Co., 646 N.E.2d 394, 397 (Mass. 1995).




                                   -22-
            The court described a known loss as reflecting "knowledge

of damage before the policy becomes effective" as compared to the

expected or intended damage exclusion, which involves "either

intending during the policy year or knowing to a substantial

certainty   that    it    was   contaminating   during     the    policy   year"

(emphasis added).        Century says that the latter direction required

the jury to disregard evidence, heavily relied on by Century, of

Boston Gas' expectations in the years before the first Century

policy went into effect.

            Taken   literally      and   in   isolation,    the    underscored

language might be understood as Century contends and might well

misstate Massachusetts law; we can see no reason why knowledge

prior to the policy year would not count against the insured.               But

the chance of prejudice is limited because the pertinent charge as

a whole (which Century did not trouble to quote) tended to convey

the correct message and also because common sense tends to reject

the notion that an earlier intention or expectation would not

count.

            Anyway, Century failed to object to the district court's

arguable misstatement when the charge was given, Fed. R. Civ. P.

51(c).   Century did object to the district court's "expected or

intended" instruction, but did so on grounds unrelated to the

temporal aspect it now criticizes.              Cf. Colon-Millin v. Sears

Roebuck de Puerto Rico, Inc., 455 F.3d 30, 40-41 (1st Cir. 2006).


                                     -23-
The misstatement could easily have been corrected on the spot. The

objection is therefore forfeit and we have dealt with the point for

the sake of trial in successor cases.

           Declaratory    judgment.          In   addition     to    awarding     the

damages   calculated    by     the   jury,    the    district       court   granted

declaratory relief requiring Century to indemnify Boston Gas for

all future costs for investigation and cleanup at and around the

Everett   site.   Century      contends--as         it   did   below--that        the

declaratory judgment is over-broad because it applies to possible

damage from MGP operations at the Everett site that was not

specifically litigated at the Everett trial.

           For instance, Century claims that Boston Gas may use the

declaratory judgment to compel Century to indemnify Boston Gas for

costs incurred to clean up the Mystic River; although the river

abuts the Everett site, Century says that no issue related to the

cleanup of the river was adjudicated as part of the Everett trial.

Century claims that these and some other future costs are "purely

speculative," not the subject of any formulated clean-up plan, and

may be subject to exclusions or defenses that Century was unable to

raise or that were otherwise not at issue during the trial.

           The district judge retains substantial discretion in

deciding whether to grant declaratory relief, but--so far as its

grant   determines     legal    liabilities--our         review     may     be   more




                                      -24-
searching.12     We    are   troubled       neither     by   the     claim   of

speculativeness--there were indications of further damage to the

river--nor about the lack of a final remedial plan.                      In the

analogous   CERCLA    context,   courts     routinely    enter     declaratory

judgments on liability for response costs or damages.               See Kelley

v. E.I. DuPont de Nemours & Co., 17 F.3d 836, 844-46 (6th Cir.

1994).

            But the declaratory judgment makes Century liable for

"all costs that Boston Gas has incurred, and will incur, for

investigation   and    cleanup   at   and    around    the   Everett     site."

Century's   obligations   are    defined    by   the    policy     and   related

liability rules and, although presumably not intended by the

district court, the judgment could be read to sweep more broadly--

say, to encompass clean-up operations that are necessitated by

future remediation of the Everett site property solely for the

benefit of the new owner.

            Surely the entry of declaratory relief in Boston Gas'

favor should not preclude an insurer from contesting the amount of

the requested costs or whether the work undertaken was consistent

with compensable remediation efforts. Cf. Foster v. United States,

922 F. Supp. 663, 664-65 (D.D.C. 1996); see also Am. Cyanamid Co.



     12
      See generally Diaz-Fonseca v. Puerto Rico, 451 F.3d 13 (1st
Cir. 2006); Ernst & Young v. Depositors Econ. Prot. Corp., 45 F.3d
530, 534 (1st Cir. 1995); Nat'l R.R. Passenger Corp. v. Providence
& Worcester R.R. Co., 798 F.2d 8, 10 (1st Cir. 1986).

                                   -25-
v. Capuano, 381 F.3d 6, 12 (1st Cir. 2004).                Whether future costs

may be covered by an exclusion (e.g., for the insured's own

property) or defense is not easily resolved in the abstract.                      One

can imagine scenarios in which Boston Gas may seek recovery for

costs that Century may deem covered by a defense not yet resolved

or forfeit.

            We conclude that as to future costs, Century cannot re-

argue matters that have already been decided, but conversely,

Boston Gas cannot properly seek to recover for future costs spent

purely to remediate its own property where no threat exists of

contamination outside the site. The district court will be able to

determine the scope of litigation when a dispute arises, using

doctrines like collateral estoppel, waiver, and the like to prevent

relitigation      of    matters   that    have   been,    or    could   have   been,

decided.

            By its literal terms the declaratory judgment could be

read to encompass costs that are not recoverable under Century's

policy; the district court may not have considered that requiring

Century    to    indemnify      Boston    Gas    for    all     costs   related    to

"investigation         and   cleanup"    may    apply    more    broadly   than    it

intended.       On remand an adjustment is needed in order to clarify

that Boston Gas' entitlement extends only to costs incurred for

remediation not barred by the terms of Century's policies and

consistent with the findings of the jury.


                                         -26-
           Statutory prejudgment interest.       Mass. Gen. Laws ch. 231

§ 6C provides:

           In   all    actions   based   on   contractual
           obligations . . . interest shall be added by
           the clerk of the court . . . at the rate of
           twelve per cent per annum from the date of the
           breach or demand. If the date of the breach
           or demand is not established, interest shall
           be added . . . at the rate of twelve per cent
           per annum from the date of the commencement of
           the action.

Based on this provision, the district court calculated prejudgment

interest (roughly $2.5 million) as running from the various dates

that Boston Gas incurred expenses for which it was entitled to

indemnity from Century.        For purposes of this calculation, Boston

Gas submitted dated invoices for all of these expenses.

           Century argues to us, as it did in the district court,

that interest should instead run from October 22, 2002--the date on

which   Boston   Gas   filed    the   action--with   respect   to   expenses

incurred before that date.       (Both agree that interest on expenses

incurred after the filing date accrues only from the dates they

were incurred.)    It says that the date of breach or demand has not

been "established" because there was no jury finding; and, further,

no breach or demand occurred before suit was filed because Boston

Gas had not requested indemnification for specific expenses.            Our

review on this claim is de novo. See R.I. Charities Trust v.

Engelhard Corp., 267 F.3d 3, 5 (1st Cir. 2001).




                                      -27-
          Massachusetts courts have repeatedly stated that, where

a case is tried to a jury, the jury is to pass on the question of

whether and when (for purposes of section 6C) breach occurred or a

demand was made.   Deerskin Trading Post, Inc. v. Spencer Press,

Inc., 495 N.E.2d 303, 308 (Mass. 1986) (in jury case neither trial

judge or appellate court can decide issue); see also Berish v.

Bornstein, 770 N.E.2d 961, 979-980 (Mass. 2002).     Here, neither

party sought a special verdict finding on this question.

          Federal courts in diversity cases are bound to follow

state substantive law, but whether a judge or jury should decide an

issue is a matter of court practice or procedure.     Byrd v. Blue

Ridge Rural Electrical Cooperative, Inc., 356 U.S. 525 (1958),

expressly decided that the distribution of issues between judge and

jury is "not bound up with rights and obligations," so as to commit

a federal court to follow the state rule.     Id. at 538; see also

Hanna v. Plumer, 380 U.S. 460, 465 (1965); Mayer v. Gary Partners

& Co., 29 F.3d 330, 333 (7th Cir. 1994).

          Boston Gas is entitled, under Massachusetts law, to

prejudgment interest at the statutory rate from the date of "breach

or demand"; but in a federal court federal practice governs who

determines that date.     Our case law does not appear to have

directly addressed this question before.   Occasionally, on this or

like issues, we have referred to state practice, e.g., Saint-Gobain

Indus. Ceramics Inc. v. Wellons, Inc., 246 F.3d 64 (1st Cir. 2001)


                               -28-
(where no one seems to have argued that federal law should govern),

but without a considered holding.

           In federal practice, usually the jury is required to pass

on all elements of damages; yet prejudgment interest is routinely

added by the judge on motion to alter or amend the judgment under

Fed. R. Civ. P. 59(e), e.g., Osterneck v. Ernst & Whinney, 489 U.S.

169,   171-72   (1989),    and   the   district     judge   decides   based   on

"considerations of fairness" whether to award interest at all and

at what rate.     Bd. of County Comm'rs of Jackson County v. United

States, 308 U.S. 343, 352 (1939).

           If interest were required to be awarded from a certain

date by right, and there were a genuine factual dispute as to that

date, then a federal court might yield to the jury, cf. Erskine v.

Van Arsdale, 82 U.S. (15 Wall.) 75, 77 (1872); but even this is not

beyond doubt since judges do determine facts in certain contexts,

see Markman v. Westview Instruments, Inc., 517 U.S. 370, 378

(1996).   The inquiry, to the extent that the seventh amendment is

invoked, is largely historical.          Id.

           We need not engage in that inquiry here because we are

convinced that no factual questions are implicated.              The material

facts are known and undisputed.               On August 4, 1995, Boston Gas

wrote to Century to give notice of the contamination:

           This will      serve as notice of circumstances
           indicating     the potential for claims against
           Boston Gas     Company ("Boston Gas") arising out
           of alleged      contamination . . . .     You are

                                       -29-
          hereby notified that Boston Gas claims
          entitlement to coverage under the referenced
          policies with respect to any claims or
          liabilities that may arise out of any
          contamination of the referenced sites.

Century responded on July 22, 1996, writing that until it could

"obtain additional factual information," it will "reserve all

rights, at law and in equity, to disclaim coverage under the terms,

conditions, definitions and exclusions of the policies."

          The letter explicitly warned that it "should not be

understood as either accepting or disclaiming coverage but, rather,

as notice to Boston Gas that coverage may be in jeopardy under the

policies."      Century   says   that,    thereafter,   Boston   Gas   never

requested payment for specific expenses or submitted particular

invoices to it for reimbursement, and Boston Gas does not claim

otherwise.   In other words, until this suit there was never a

refusal to pay any invoice, either specifically or categorically.

          On the present record, no date of "breach or demand" has

been established, and Boston Gas is entitled to statutory interest

only from the date of filing suit (or later, for those expenses

that post-dated the filing).      The Supreme Judicial Court has held

that a demand should inform the defendant "of the basis and extent

of its obligations, as well as the fact that performance was then

due."   Town of Lexington v. Town of Bedford, 393 N.E.2d 321, 324

(Mass. 1979).    Boston Gas' letter, which gave notice only of the

"potential" for claims (presumably to satisfy notice requirements),


                                   -30-
did not do so; it was not an "unequivocal demand[] for payment."

Gen. Dynamics Corp. v. Fed. Pac. Elec. Co., 482 N.E.2d 824, 830

(Mass. App. Ct. 1985).

           In allowing interest from the dates of the invoices, the

district court relied on Sterilite Corp. v. Continental Casualty

Co., 494 N.E.2d 1008 (Mass. 1986), holding that an insurer who

breached its duty to defend was liable for interest from the dates

that the insured, "on notice that the defendant would refuse to pay

for those expenses, was forced to pay those expenses itself."   Id.

at 1011.   But Century had not disclaimed coverage, cf. Protective

Life Ins. Co. v. Dignity Viatical Settlement Partners, L.P., 171

F.3d 52, 55 (1st Cir. 1999), and was not bound to make payments in

the absence of specific requests to do so.

           Missing policies.   Century's last objection is easily

dispatched.   Century challenges the jury's findings on the limits

of liability for the insurance policies Century issued to Boston

Gas between 1951 and 1960.     Although Boston Gas sought coverage

for liabilities at the Everett site under the Century policy in

effect from 1966-1969, Boston Gas--presumably to protect its own

interests in subsequent cases and in settlement discussions--

requested that the jury find the limits of Century's policy XPL-

3392, which was in effect from 1951 through 1960.         The jury

concluded that the policy had an annual limit of $500,000 during




                               -31-
the 1952-54 time period, and a limit of $1,000,000 in all the other

years.

            Neither   party   produced   a   copy   of   policy   XPL-3392;

possibly the policy, over a half century old, was lost or perhaps

destroyed    at   some   point   in   the    intervening     years.     Under

Massachusetts law, the loss of a policy is not fatal to a claim:

the proponent of the policy simply bears the burden of proving--

e.g., by business records and expert testimony--the prior existence

and terms of the policy.      Rubenstein, 694 N.E.2d at 384.          Century

now claims that the jury's findings as to the terms of policy XPL-

3392 are unsupported by the evidence.

            At trial, evidence was produced by both sides as to

Century's insurance practices during the relevant period; for

example, Boston Gas placed in evidence a 1951 Century insurance

policy issued to Brooklyn Union Gas Company.             Boston Gas relied

heavily on the language of the 1960-66 policy, XPL-5607, which

stated that it was a renewal of XPL-3392; Boston Gas' former

director of risk management, Stephanie Shepard, testified that the

term "renewing" meant that XPL-5607, which had an annual limit of

$1,000,000, renewed a prior policy with similar coverage and

limits.

            Boston Gas also relied on testimony about reinsurance

practices from Judith Harnadek, an assistant vice-president in

Century's claim handling department, to show that XPL-3392 was


                                  -32-
valued somewhere between $500,000 and $1,000,000.              Century, in

turn,   attempted    to   impugn   Shepard's    knowledge    of     insurance

practices during the 1950s and said that Harnadek's testimony

established that Century's insurance practices were highly variable

and the policy limits of XPL-3392 could not be determined with any

certainty.

           The jury's determination of raw facts stands unless it is

unsupported by any rational view of the evidence. Marcoux v. Shell

Oil Prods. Co. LLC, 524 F.3d 33, 40 (1st Cir. 2008).           Here a jury

could reasonably be persuaded by Boston Gas' evidence showing that

XPL-5607 served as a renewal of the earlier XPL-3392, as well as by

the documentary evidence of contemporaneous policies issued by

Century to other manufactured gas companies.           Century produced

evidence casting doubt on Boston Gas' position, but nothing that

compelled a different finding.

           Conclusion.      The    questions   specified    below    will   be

referred to the Massachusetts Supreme Judicial Court for its

consideration.      We have decided all other issues, confirming that

the certified issues do affect the ultimate outcome. The questions

are as follows:

                  1.    Where an insured protected by
           standard CGL policy language incurs covered
           costs as a result of ongoing environmental
           contamination occurring over more than one
           year and the insurer provided coverage for
           less than the full period of years in which
           contamination occurred, should the direct
           liability of the sued insurer be pro rated in

                                    -33-
           some manner among all insurers "on the risk,"
           limiting the direct liability of the sued
           insurer to its share but leaving the insured
           free to seek the balance from other such
           insurers (see pages 9-13, above) ?

                  2. If some form of pro rata liability
           is called for in such circumstances, what
           allocation method or formula should be used
           (see page 13, above)?

                  3.    If a single insurer in such
           circumstances is subject to liability under
           more than one policy and each policy has a
           separate deductible or self-insured retention,
           should the insured be able to collect covered
           losses from a single policy subject only to
           that policy's deductible or self-insured
           retention, or should liability be reduced by
           the sum of the applicable self-insured
           retentions,   effectively   allocating   total
           liability across the policies of that insurer
           in effect during the contamination period (see
           page 7 and note 4, above)?

We would also welcome any additional observations about relevant

Massachusetts law that the Supreme Judicial Court may wish to

offer.

           The clerk of this court is directed to forward to the

Massachusetts Supreme Judicial Court, under the official seal of

this court, a copy of the certified questions and our decision in

this case, along with a copy of the briefs and appendix filed by

the parties in this case.   We retain jurisdiction over this appeal

and will frame our ultimate decision and judgment after receiving

such guidance on the certified questions as the SJC may be prepared

to give.   No costs will be taxed at this stage of the proceedings,



                                -34-
but the issue may be revisited after we have received the answers

to the certified questions.

          It is so ordered.




                              -35-
