United States District Court, D. Colorado
LEWIS T. BABCOCK, JUDGE
This dispute over uninsured/underinsured (“UM/UIM”) motorist coverage under an automobile insurance policy is before me on Defendant Allstate Insurance Company’s (“Allstate”) Motion for Summary Judgment [Doc. # 51] on all of Plaintiff Peggy Montoya’s claims. Allstate argues that Ms. Montoya’s claims-for breach of contract, common law bad faith breach of an insurance contract, and unreasonable delay or denial of benefits (“statutory bad faith”) under Colo. Rev. Stat. §§ 10-3-1115, -1116-are not ripe and must therefore be dismissed for lack of subject matter jurisdiction. Allstate further argues that it is entitled to summary judgment on these claims. I have reviewed the parties’ briefing and determined that oral argument would not materially assist me in deciding Allstate’s motion. For the following reasons, I DENY the motion.
On December 14, 2012, Ms. Montoya was injured in a car accident that the parties agree resulted from the negligence of another driver, Romeo Gomez-Ramos. 1st Am. Compl. ¶ 6 [Doc. # 4]. At the time of the accident, Ms. Montoya was covered under an automobile insurance policy issued by Allstate, which included UM/UIM coverage with a limit of $100, 000 per person and $300, 000 per accident. Id. ¶ 5. By the next day, Ms. Montoya had advised Allstate of the crash. Doc. # 61-3 at 1. On July 10, 2013, Ms. Montoya’s lawyer sent a letter to Allstate providing it “formal notice of a potential UM/UIM claim.” Doc. # 58-4 at 2. In April 2014, Ms. Montoya, with Allstate’s permission, settled a bodily injury claim against Mr. Gomez-Ramos’ insurer for the $25, 000 liability limit of his policy. 1st Am. Compl. ¶ 15 [Doc. # 4]. She filed this lawsuit in Colorado state court in October 2014. Doc. # 1. Allstate subsequently removed the case to this Court. Id. Ms. Montoya alleges that Allstate “claims it is still investigating [her] claim” and “[t]o date . . . has not paid [her] any of her entitled UIM benefits.” 1st Am. Compl. ¶ 15 [Doc. # 4]. Her alleged injuries include lower back pain, right hip pain, and sacral disorders. Id. ¶ 8. She seeks damages for “permanent physical injuries, pain and suffering, loss of enjoyment of life, physical impairment, [and] medical bills and expenses, ” among other things. Id. ¶ 18. The Court has jurisdiction pursuant to 28 U.S.C. § 1332.
“The issue whether a claim is ripe for review bears on the court’s subject matter jurisdiction under Article III of the Constitution.” Bateman v. City of W. Bountiful, 89 F.3d 704, 706 (10th Cir. 1996) (citation omitted). “Accordingly, a ripeness challenge, like most other challenges to a court’s subject matter jurisdiction, is treated as a motion to dismiss under Federal Rule of Civil Procedure 12(b)(1).” Id. Such a challenge “can be raised at any time.” Utah v. U.S. Dep’t of the Interior, 210 F.3d 1193, 1196 (10th Cir. 2000). Courts use a two-part inquiry to determine whether a claim is ripe. New Mexicans for Bill Richardson v. Gonzales, 64 F.3d 1495, 1499 (10th Cir. 1995). First, the court asks “whether the case involves uncertain or contingent future events that may not occur as anticipated, or indeed may not occur at all.” Id. (internal citation and quotations omitted). Second, courts assess the “hardship to the parties of withholding judicial resolution.” Id. I address these considerations in turn.
This case does not involve any uncertain or contingent future events. Allstate argues that, because the policy language limits coverage to damages that the insured is “legally entitled to recover, ” Allstate’s “contractual obligation to pay UM/UIM benefits will not be triggered” until Ms. Montoya proves “the extent of [her] damages” in a “judicial proceeding against the uninsured motorist or [his] insurer, or through an arbitration proceeding.” Mot. at 8 [Doc. # 51]. This argument is contrary to Colorado law, which the parties agree applies here. Colorado’s UM/UIM statute provides that policies “shall cover the difference, if any, between the amount of the limits of any legal liability coverage and the amount of the damages sustained, excluding exemplary damages, up to the maximum amount of the coverage obtained.” Colo. Rev. Stat. § 10-4-609(1)(c). Therefore, “[f]or purposes of triggering UIM coverage, it is irrelevant whether and in what amount the insured recovers from the underinsured motorist.” Tubbs v. Farmers Ins. Exch., 353 P.3d 924, 926 (Colo.App. 2015) (internal citation and quotations omitted). Rather, what is relevant is “the limit of any liable party’s legal liability coverage.” Id. Indeed, the Colorado Court of Appeals has found policy language predicating UIM coverage on the exhaustion of the tortfeasor’s legal liability coverage void and unenforceable because it purported to “impose[ ] a condition precedent on coverage mandated by the statute.” Id. at 926-27. Accordingly, the condition precedent that Allstate proposes-even if it were supported by the language of the policy, which neither party has provided-would be unenforceable.
Ms. Montoya’s bad faith claims similarly do not involve uncertain or contingent future events. Under the former version of Colorado’s UM/UIM statute, coverage was mandated in “an amount equal to the gap between the amount an insured receives from an underinsured driver and the insured’s UIM policy limits.” Freeman v. State Farm Mut. Auto. Ins. Co., 946 P.2d 584, 585 (Colo.App. 1997). A bad faith claim could not accrue “until the insured ha[d] obtained a judgment against or . . . settled with the underinsured driver” because “the insurer [could not] know the amount of UIM benefits potentially due to its insured” until that time. Cork v. Sentry Ins., 194 P.3d 422, 428 (Colo.App. 2008). Ms. Montoya, with Allstate’s permission, settled with Mr. Gomez-Ramos’ insurer for the legal liability limits of his policy. So her bad faith claims would have accrued even under the former version of the statute. As noted, under the current statute, only the limit of any tortfeasor’s legal liability coverage-not the amount of money the injured party recovered from the tortfeasor or his insurer-need be ascertainable to determine the amount of UIM coverage available. The parties agree that Mr. Gomez-Ramos’ legal liability coverage limit was $25, 000. Accordingly, Ms. Montoya’s bad faith claims have certainly accrued by now.
I turn to the second factor in the ripeness analysis, the hardship to the parties that would result from withholding judicial resolution of Ms. Montoya’s claims. The parties have undertaken significant discovery in this lawsuit. Trial is set to begin in about three months. And the Colorado Supreme Court has observed that the public policy of the state “protects the insured from being forced to traverse undue procedural hurdles and re-litigate matters prior to a recovery” under a UM/UIM policy. State Farm Mut. Auto. Ins. Co. v. Brekke, 105 P.3d 177, 185 (Colo. 2004). In view of these facts, I conclude that it would work a substantial hardship on the parties to delay resolution of Ms. Montoya’s claims.
The facts of other UIM coverage disputes confirm that there is nothing premature about Ms. Montoya’s claims. For example, in one case, as here, the insured settled with the tortfeasor’s insurer for the liability policy limits of $25, 000 and then sued his own insurer for UIM coverage; there was no indication that he sued the tortfeasor prior to doing so. See Walker v. American Std. Ins. Co. of Wisc., No. 11-cv-00927-LTB, 2011 WL 3876901, at *1 (D. Colo. Sept. 2, 2011). In another case, the Colorado Court of Appeals held that sufficient evidence supported a verdict against an insurer on a statutory bad faith claim where, as here, the insured sued his insurer after settling with the tortfeasor’s carrier; again, there was no indication that the insured brought a lawsuit against the tortfeasor. See Vaccaro v. American Fam. Ins. Grp., 275 P.3d 750, 754, 759 (Colo.App. 2012); see also Baker v. Allied Prop. & Cas. Ins. Co., 939 F.Supp.2d 1091, 1112 (D. Colo. 2013) (there was sufficient evidence to defeat insurer’s summary judgment motion on bad faith claims in UM/UIM coverage lawsuit brought by insured after accepting policy limits payout from tortfeasor’s insurer). Accordingly, I conclude that Ms. Montoya’s claims are ripe and deny Allstate’s motion with respect to this issue.
B. Summary Judgment
1. Standard of Review
A court “shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). The movant has the initial responsibility of identifying for the Court “particular parts of materials in the record”-including, for example, depositions, documents, declarations, and interrogatory answers-that it believes show the absence of genuine issues of material fact. Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Mares v. ConAgra Poultry Co., 971 F.2d 492, 494 (10th Cir. 1992). Once the movant has done so, the non-movant may not rest on the allegations contained in his complaint, but must “respond with specific facts showing the existence of a genuine factual issue to be tried.” Otteson v. United States, 622 F.2d 516, 519 (10th Cir. 1980) (internal citation omitted); Fed.R.Civ.P. 56 (c) & (e). If a reasonable jury could not return a verdict for the non-moving party, summary judgment is proper and there is no need for a trial. Anderson v. Liberty Lobby, Inc., 477 ...