Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Travelers Property Casualty Co. of America v. Stresscon Corp.

Supreme Court of Colorado, En Banc

April 25, 2016

Travelers Property Casualty Company of America, a Connecticut company, Petitioner
Stresscon Corporation, a Colorado corporation. Respondent

          Opinion modified, and as modified, May 23, 2016

         Certiorari to the Colorado Court of Appeals Court of Appeals Case Nos. 11CA1239, 11CA1582

          Attorneys for Petitioner: Wheeler Trigg O'Donnell LLP Malcolm E. Wheeler Evan Stephenson Denver, Colorado

          Attorneys for Respondent: Zonies Law LLC Sean Connelly Denver, Colorado Sherman & Howard L.L.C. Bret R. Gunnell Katherine D. Varholak Brooke Yates Denver, Colorado

          Attorneys for Amici Curiae American Insurance Association & The Property Casualty Insurers Association of America: Hall & Evans, L.L.C. Alan Epstein Denver, Colorado

          Attorneys for Amicus Curiae The Colorado Trial Lawyers Association: Roberts Levin Rosenberg PC Bradly A. Levin Michael J. Rosenberg Denver, Colorado

          Attorneys for Amicus Curiae Complex Insurance Claims Litigation Association: White and Steele, P.C. Frederick W. Klann Denver, Colorado

          JUSTICE MÁRQUEZ dissents, and JUSTICE HOOD and JUSTICE GABRIEL join in the dissent.


          COATS JUSTICE.

         ¶1 Travelers petitioned for review of the court of appeals' judgment affirming the district court's denial of its motion for directed verdict in a lawsuit brought by its insured, Stresscon. Much as the district court had done, the appellate court rejected Travelers' contention that the no-voluntary-payments clause of their insurance contract relieved it of any obligation to indemnify Stresscon for payments Stresscon had made without its consent. Instead, the court of appeals found that this court's opinion in Friedland v. Travelers Indemnity Co., 105 P.3d 639 (Colo. 2005), permitting the insured in that case an opportunity to demonstrate a lack of prejudice from its failure to comply with a notice requirement of its insurance contract, had effectively overruled our prior "no voluntary payments" jurisprudence to the contrary and given Stresscon a similar opportunity.

         ¶2 Because our adoption of a notice-prejudice rule in Friedland did not overrule any existing "no voluntary payments" jurisprudence in this jurisdiction, and because we decline to extend our notice-prejudice reasoning in Friedland to Stresscon's voluntary payments, made in the face of the no-voluntary-payments clause of its insurance contract with Travelers, the judgment of the court of appeals is reversed.


         ¶3 Stresscon Corporation, a subcontracting concrete company, filed suit against Travelers Property Casualty Company of America, alleging, among other things, that Travelers acted in bad faith, unreasonably delaying or denying its claim for covered insurance benefits; and Stresscon sought awards of two times the covered benefits along with fees and costs, as prescribed by statute. Stresscon's claims for relief arose from a serious construction accident in July 2007, which was caused by a crane operator employed by a company that was itself a subcontractor of Stresscon. Stresscon's general contractor, Mortenson, sought damages from Stresscon, asserting Stresson's contractual liability for the resulting construction delays, and Stresscon in turn sought indemnification from Travelers.

         ¶4 Although there was much dispute over the factual and legal import of Travelers' reservation of rights and other of its communications with both Stresscon and Mortenson concerning Mortenson's claim, there was no dispute that by December 31, 2008, Travelers had not paid the damages asserted by Mortenson. There was also no dispute that on December 31, 2008, despite Mortenson's failure to bring a lawsuit or seek arbitration against Stresscon, Mortenson and Stresscon entered into a settlement agreement without consulting Travelers. The agreement settled, without differentiation as to amount, this accident-related claim, along with other unrelated and concededly uncovered Mortenson claims against Stresscon. In March 2009, also without prior notice of the settlement agreement, Stresscon filed suit against several entities, including Travelers, the subcontracting crane company, and various other insurers; and with regard to Travelers, it ultimately prevailed, winning a verdict for bad faith breach of the insurance contract and an award of the statutory amount, costs, and attorney fees.

         ¶5 With regard to the issue upon which review was granted in this court, Travelers moved for summary judgment in the trial court on the grounds that it owed Stresscon no duty of indemnification for the amount of Stresscon's settlement, according to the terms of the no-voluntary-payments provision of the policy, which stated, "No insured will, except at that insured's own cost, voluntarily make a payment, assume any obligation, or incur any expense, other than for first aid, without our consent." The district court denied Travelers' motion, finding by analogy to the so-called "notice-prejudice" rule previously adopted by this court with regard to an insured's failure to give timely notice of a claim concerning an occurrence-based liability policy, that the policy's no-voluntary-payments provision could relieve Travelers of indemnification only if Travelers suffered prejudice from Stresscon's settlement, and that the question of prejudice involved disputed matters of fact, which could not be resolved by summary judgment. Travelers renewed essentially the same challenge―that it owed Stresscon no duty of indemnification as the result of Stresscon's settlement with Mortenson, either because no proof of ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.