Ferrellgas, Inc. v. Yeiser
247 P.3d 1022
Colo.2011Background
- Yeiser contracted Ferrellgas for propane; damages occurred from freezing pipes due to late delivery.
- Farmers Insurance reimbursed Yeiser and contractors $212,071.94 under Yeiser's homeowners policy and held a subrogation interest.
- Ferrellgas settled Farmers's subrogation for $172,657.55; Yeiser was not a party to that settlement.
- Yeiser sued for breach of contract; liability admitted, damages contested at trial; Farmers not joined.
- Pre-verdict Ferrellgas offered $197,000 inclusive of costs and interest; Yeiser rejected.
- Post-verdict, the court set off the full $212,071.94; Yeiser judgment reduced to $102,251.27; Ferrellgas costs awarded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Proper setoff amount from Farmers payments | Yeiser argues only Ferrellgas's $172,657.55 is setoffable. | Ferrellgas argues full $212,071.94 can be set off due to Farmers's subrogation and settlement. | Full $212,071.94 setoff permitted; collateral source rule not applicable due to subrogation settlement. |
| Pre-judgment interest calculation after setoff | Interest should accrue on the full verdict before any setoff is applied. | Setoff reduces the base for pre-judgment interest. | deduct the setoff before calculating pre-judgment interest; recalculate accordingly. |
| Impact of setoff on costs under settlement statute | Costs should be denied if post-setoff judgment is less than offer. | Costs may be recoverable if offer exceeds post-setoff amount with accrued pre-settlement interest. | On remand, compare Ferrellgas's $197,000 offer to the verdict amount minus setoff, plus pre-judgment interest; reinstate costs if appropriate. |
Key Cases Cited
- Goodyear Tire & Rubber Co. v. Holmes, 193 P.3d 821 (Colo. 2008) (defines accrual of pre-judgment interest for property damage via Goodyear measures)
- Colo. Permanente Med. Group, P.C. v. Evans, 926 P.2d 1218 (Colo. 1996) (collateral source rule caveats in mixed recoveries)
- Rubio v. Farris, 51 P.3d 992 (Colo.App. 2002) (settlement offers: compare to final judgment with explicit costs when included)
- Novak v. Craven, 195 P.3d 1115 (Colo.App. 2008) (explicit inclusion of costs in settlement offers; not assumed otherwise)
- Centric-Jones Co. v. Hufnagel, 848 P.2d 942 (Colo. 1993) (settlement framework as ironclad commitment to pay offered amount)
- American Family Mut. Ins. Co. v. DeWitt, 218 P.3d 318 (Colo. 2009) (insurance subrogation rights; insurer stands in insured's shoes)