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Montview Boulevard Presbyterian Church v. Church Mutual Insurance Co.

United States District Court, D. Colorado

January 20, 2016

MONTVIEW BOULEVARD PRESBYTERIAN CHURCH, a Colorado nonprofit corporation, Plaintiff/Counterclaim Defendant,
v.
CHURCH MUTUAL INSURANCE COMPANY, a Wisconsin insurance company, Defendant/Counterclaim Plaintiff.

ORDER

Kathleen M Tafoya United States Magistrate Judse.

This matter is before the court on “Non-Party John Kezer’s Motion to Quash Subpoena with Authority” [Doc. No. 103] filed on November 20, 2015. Church Mutual Insurance Company (“Church Mutual”) filed its Response on December 7, 2015 [Doc. No. 119], and “Non-Party John Kezer’s Reply to Church Mutual Insurance Company’s Response [Dkt. 119] to Kezer’s Motion to Quash Subpoena [Dkt. 103]” (“Reply”) was filed on December 14, 2015 [Doc. No. 134].

Also considered are Non-Parties Judah Leon Bensusan, Atlantis Claims Services, LLC (“Atlantis Claims”), Roofing and Restoration Construction Group, Inc. and Top Notch Adjusters’ “Forthwith Motion for Limited Stay of Discovery” [Doc. No. 145], Non-Parties Phillip Coutu, Rooftop Restorations, Inc., Power Adjusters, Inc., Rooftop Restoration & Builders, Inc., Rooftop Roofing, Inc., Rooftop Restoration, Inc., and AAA Rooftop Roofing, Inc.’s “Forthwith Motion for Limited Stay of Discovery” [Doc. No. 149], and Church Mutual’s Consolidated Response [Doc. No. 156].

Background

Defendant Church Mutual is seeking discovery on its counterclaims related to three non-parties and their related business entities with respect to a damage award made through an appraisal process outlined in an underlying policy of insurance coverage between Defendant and Plaintiff Montview Boulevard Presbyterian Church (“Montview”). To that end, during the discovery period related to the Counterclaim, Church Mutual issued third-party subpoenas seeking documents from or about the non-party individuals and their companies. In response to the subpoenas, each of the three individuals filed separate motions to quash. [Doc. Nos. 103, 104 and 110.] The three motions to quash were considered at a hearing on December 17, 2015. (See Transcript [Doc. No. 138].) This court entered an order denying, in whole or in part, two of the motions to quash [Doc. Nos. 104 and 110] and took the third motion, John Kezer’s [Doc. No. 103], under advisement.

The primary outstanding issue with respect to non-party Kezer’s Motion to Quash concerns whether or not the appraisal provision contained in the insurance policy is properly classified as an arbitration clause thus subjecting the proceedings to the Colorado Uniform Arbitration Act (“CUAA”). See Colo. Rev. Stat. 13-22-201 et. seq. If the appraisal process is deemed an arbitration, discovery directed to the arbitrators is limited by the CUAA.

This court’s rulings on December 17, 2015, as to the other two motions were not dependent upon a determination concerning the applicability of the CUAA to the appraisal process because the court found Church Mutual had met its burden to present prima facie evidence justifying discovery even if the CUAA applied as to discovery against Bensusan and his entities and Coutu and his entities. As to umpire Kezer, however, the court took under advisement the CUAA issue, finding it necessary to reach the applicability of the CUAA in his case where prima facie evidence of wrongdoing was implicitly not found by the court.

Upon further review, the court finds that the insurance policy’s appraisal process is not an arbitration subjecting appraisals to the provisions of the CUAA.

Analysis

The appraisal provision applicable to this case provides, in part, PROPERTY CONDITIONS

This Property Coverage Part is subject to the Common Policy Conditions, any other conditions in any Property Coverage Forms, and the following conditions.

LOSS CONDITIONS

2. Appraisal If we and you disagree on the value of the property or the amount of loss, either may make written demand for an appraisal of the loss. In this event, each party will select a competent and impartial appraiser. The two appraisers will select an umpire. If they cannot agree, either may request that selection be made by a judge of a court having jurisdiction. The appraisers will state separately the value of the property and amount of loss. If they fail to agree, they ...

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