Nibert v. Geico Casualty Co
2017 COA 23
| Colo. Ct. App. | 2017Background
- Denise Nibert was injured in a 2012 motorcycle-car collision; the at-fault driver’s insurer (Allstate) paid $50,000 and Geico Indemnity paid $50,000 UIM on the motorcycle. Nibert also had a separate $25,000 UIM automobile policy with Geico Casualty (secondary).
- Geico Casualty initially offered $1,500 on the secondary UIM claim; Nibert sued Geico Casualty in January 2015 for breach of contract, common-law bad faith, and statutory delay under § 10-3-1116, C.R.S.
- Before trial Geico Casualty paid the $25,000 policy limit to resolve the contract claim; trial proceeded on bad faith and statutory delay claims.
- A jury awarded $33,250 for bad faith and $25,000 for statutory delay; the court entered judgment for $50,000 on the statutory claim (two times the $25,000 benefit) and awarded Nibert $118,875.30 in attorney fees; the court later awarded appellate fees on remand.
- Geico Casualty appealed, challenging (1) the trial court’s refusal to give a “reasonable to challenge fairly debatable claims” jury instruction, (2) the statutory award of double damages when the benefit was paid pretrial, and (3) the scope/timing of attorney fees recoverable under § 10-3-1116.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court erred by refusing Geico’s proposed jury instruction that "it is reasonable to challenge fairly debatable claims" | Nibert argued the proposed instruction misstated law and would mislead the jury | Geico argued the instruction accurately stated that challenging fairly debatable claims is reasonable and was necessary to present its defense | Court held refusal was proper: instruction overstated law (fair debatability is only a factor), parties could present the theory via expert testimony and closing argument, so no error |
| Whether § 10-3-1116 permits recovery of two times the covered benefit even if the insurer paid the benefit pretrial (i.e., effect of double-damages and setoff) | Nibert argued the statute authorizes two times the covered benefit in addition to any benefit recovered elsewhere; no setoff required | Geico argued the statute is penal and should be strictly construed to allow setoff for amounts already paid | Court held statute’s plain language authorizes two times the covered benefit in addition to any recovery; awarding $50,000 (two times $25,000) despite pretrial payment was proper |
| Whether attorney fees under § 10-3-1116 are limited to fees incurred only after the date of delay and only for prosecuting the contract claim | Nibert argued § 10-3-1116 authorizes reasonable fees for prosecuting statutory and related extra-contractual claims, including fees incurred before and after a specific payment date when reasonably related | Geico argued fees should be limited to the period from the date of first delay to the date of payment and limited to contractual-claim work | Court held fees need only be reasonable and related to enforcing the statutory claim; trial court did not err in awarding prepayment and cross-claim-related fees; factual relatedness is for the trial court to decide |
| Whether prevailing party may recover appellate attorney fees under § 10-3-1116 | Nibert sought appellate fees as prevailing party | Geico opposed | Court granted appellate fees and remanded to trial court to determine reasonable amount |
Key Cases Cited
- Clyncke v. Waneka, 157 P.3d 1072 (Colo. 2007) (standard for reviewing jury instructions)
- Day v. Johnson, 255 P.3d 1064 (Colo. 2011) (abuse-of-discretion review for giving instructions that correctly state law)
- Etherton v. Owners Ins. Co., 829 F.3d 1209 (10th Cir. 2016) (discussion limiting fair-debatability relevance to common-law bad faith)
- Allstate Ins. Co. v. Huizar, 52 P.3d 816 (Colo. 2002) (American Rule on attorney fees and statutory exceptions)
- Cassim v. Allstate Ins. Co., 94 P.3d 513 (Cal. 2004) (California decision on fees in bad-faith context; cited but distinguished)
- Vista Resorts, Inc. v. Goodyear Tire & Rubber Co., 117 P.3d 60 (Colo. App. 2005) (guidance on refusing improper or argumentative jury instructions)