Kisselman v. American Family Mutual Insurance Co.
2011 Colo. App. LEXIS 2040
| Colo. Ct. App. | 2011Background
- Kisselman was injured in 2005 in a collision with an underinsured driver; his policy included UIM and umbrella coverage up to $1.1 million.
- He settled with the other driver for policy limits of $25,000 after American Family endorsed the claim.
- Kisselman pursued underinsured motorist benefits and other damages under his American Family policy beginning in 2006.
- An arbitration in November 2008 determined past and future damages; the award was $1,312,187.98 and later reduced to $1,075,000.
- In 2009 Kisselman amended the complaint to include a statutory claim under sections 10-83-1115 and -1116; later filings refined the remaining claims.
- The district court ruled in 2010 that the statutes were inapplicable; Kisselman appealed, and the court certified the judgment under Rule 54(b).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Do sections 10-3-1115 and -1116 apply prospectively to post‑August 5, 2008 conduct? | Kisselman contends prospective application. | American Family argues inapplicability to post‑effective date acts. | Yes; statutes apply prospectively to post‑effective date conduct. |
| Do the statutes create a new private right of action distinct from common law bad faith? | Statutes create an express private right separate from common law. | Statutes merely restate or supplement common law. | They create a new private right of action under 10-83-1115 and -1116. |
| Do the statutes impose a different standard of liability than the common law standard? | Statutory standard is distinct and less onerous than common law. | Standards are effectively the same as common law. | Yes; statutory standard is different and imposes a statutory duty not to delay or deny without a reasonable basis. |
| Can post‑August 5, 2008 conduct be the basis for a statutory claim arising from a pre‑effective date claim? | Post‑effective date acts can support a statutory claim if related to pre‑existing claim. | Only post‑effective date conduct is actionable; pre‑existing claims barred. | Post‑effective date acts may support the statutory claim; pre‑effective date acts cannot form the basis. |
| Was Kisselman's statutory claim adequately pleaded under the correct statutory sections? | Allegations pleaded sufficed to plead violation of 10-83-1115 and seek remedies under 10-83-1116. | Pleading framed under 10-83-1116 only was insufficient. | Pleading adequate to state a statutory claim under 10-83-1115 and seek remedies under 10-83-1116. |
Key Cases Cited
- Travelers Ins. Co. v. Savio, 706 P.2d 1258 (Colo. 1985) (establishes first‑party bad faith standard)
- Dale v. Guar. Nat’l Ins. Co., 948 P.2d 545 (Colo. 1997) (continuity of bad faith conduct and course of conduct considerations)
- Goodson v. Am. Standard Ins. Co., 89 P.3d 409 (Colo. 2004) (bad faith liability framework in insurance contracts)
- Allen v. Am. Family Mut. Ins. Co., 102 P.3d 333 (Colo. 2004) (insurer’s duty of good faith and fair dealing in California context (Colo.))
- Welby Gardens v. Adams Cnty. Bd. of Equalization, 71 P.3d 992 (Colo. 2003) (legislative history can inform statutory meaning)
- Rodriguez v. Schutt, 914 P.2d 921 (Colo. 1996) (interpretation of plain statutory language in context)
- In re Estate of DeWitt, 54 P.3d 849 (Colo. 2002) (retrospective application considerations for statutes)