2018 COA 56
Colo. Ct. App.2018Background
- On June 24, 2013 Marissa Peña was in a three‑car collision; both Peña and another driver, Herman Garner, were insured by American Family Mutual Insurance Company (American Family).
- Peña sought recovery for damage to her car; an investigating officer assigned 100% fault to Garner.
- Peña’s counsel notified American Family that because Garner’s insurer (American Family) refused to pay under Garner’s property‑damage coverage, Peña should be able to treat Garner as an "uninsured motor vehicle" under her Uninsured Motorist Property Damage (UMPD) coverage.
- American Family responded that it was denying liability for Garner (concluding Garner was not responsible) but did not deny that Garner’s policy provided coverage for the accident.
- Peña sued American Family under Colo. Rev. Stat. § 10‑3‑1115 for unreasonable delay/denial of UMPD benefits; the district court dismissed without prejudice as premature, concluding UMPD would not apply until Garner’s liability was finally determined.
- The Court of Appeals affirmed but on the alternative ground that Peña’s UMPD cannot be triggered by an insurer’s denial of liability—only by a denial of coverage—so Peña had no UMPD claim as a matter of law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Peña’s UMPD applies when the other driver’s insurer denies liability but not coverage | Peña: American Family’s denial of liability allows her to treat Garner as uninsured under her policy and pursue UMPD | American Family: Denial of liability is not a denial of coverage; UMPD only applies when the other insurer denies coverage | Held: UMPD does not apply; denial of liability ≠ denial of coverage, so no UMPD claim exists |
| Whether dismissal without prejudice was appealable given statute of limitations | Peña: Appeal should proceed because she was denied UMPD benefits and statutory remedy may be time‑barred | American Family: Dismissal was proper (premature action) | Held: Court exercised jurisdiction because, on the merits, Peña’s claim is legally deficient and the limitations period had run, so review is appropriate |
Key Cases Cited
- Estate of Anderson v. Safeco Ins. Co. of Ill., 567 F.3d 404 (8th Cir. 2009) (distinguishing denial of liability from denial of coverage in uninsured‑motorist context)
- Noel v. Metropolitan Property & Liability Ins. Co., 672 N.E.2d 119 (Mass. App. Ct. 1996) (denial of a claim on liability grounds does not equate to a coverage denial)
- Clark v. Prudential Property & Casualty Ins. Co., 66 P.3d 242 (Idaho 2003) (coverage relates to whether policy applies; liability relates to fault)
- Page v. Insurance Co. of North America, 64 Cal. Rptr. 89 (Cal. Ct. App. 1967) (insurer’s denial on liability issues does not necessarily mean lack of coverage)