Owners Insurance Company, a Michigan corporation, Petitioner-Appellant,
Dakota Station II Condominium Association, Inc., a Colorado corporation, Respondent-Appellee.
Jefferson County District Court No. 15CV31037 Honorable
Christopher J. Munch, Judge
Wheeler Waters, PC, Karen H. Wheeler, Matthew W. Hall,
Englewood, Colorado, for Petitioner-Appellant
Cavanagh & Holmes, LLC, Jonah G. Hunt, Denver, Colorado,
1 Plaintiff, Owners Insurance Company (Owners), appeals the
trial court's judgment denying its petition to vacate an
appraisal award. We affirm.
2 Owners issued a property damage insurance policy to Dakota
Station II Condominium Association, Inc. (Dakota). Wind and
hail storms damaged buildings in the residential community
owned by Dakota. The parties combined the losses into a
single insurance claim but disagreed about the total amount
3 The parties then invoked the insurance policy's
appraisal provision. Each party selected an appraiser. When
the appraisers submitted proposed awards of differing
amounts, they nominated a neutral umpire as provided in the
4 In calculating a final award of approximately $3 million,
the umpire adopted four damage estimates from Owners'
appraiser, Mark Burns, and two estimates from Dakota's
appraiser, Laura Haber. Burns disagreed with the final award
and declined to sign the final determination of costs.
However, the umpire and Haber agreed and signed the award,
and Owners paid Dakota.
5 Dakota later sued Owners in federal court, Dakota
Station II Condo. Ass'n, Inc. v. Auto-Owners Ins.
Co., No. 14-CV-2839-RM-NYW, 2015 WL 6591888 (D. Colo.
Oct. 30, 2015) (unpublished opinion), for breach of contract
and unreasonable delay in paying insurance benefits. During
discovery in the federal suit, Owners learned several facts
about Haber that it alleges demonstrate she was not an
impartial appraiser as required by statute and by the
6 Owners then filed a petition to vacate the appraisal award
under section 13-22-223, C.R.S. 2016, of the Colorado Uniform
Arbitration Act (CUAA). Following a hearing, the trial court
denied the petition in an oral ruling on March 11,
Timeliness of Motion to Vacate
7 Dakota initially contends Owners failed to timely file a
"motion" to vacate within ninety-one days of
learning of its basis for vacating the award as required by
section 13-22-223(2) because Owners' filing was captioned
a "petition" rather than a "motion." We
disagree. While the CUAA refers to a "motion" to
vacate, rather than a "petition, " the substance of
the pleading, and not its title, governs. Hawkins v.
State Comp. Ins. Auth., 790 P.2d 893, 894 (Colo.App.
1990). We conclude that Owners' petition satisfied the
statutory requirement for a timely motion to vacate the
Appraiser Impartiality Under the CUAA
8 Owners contends the trial court erred when it did not
analyze the insurance policy's appraisal dispute
provision, as well as the hiring and conduct of Haber, under
the CUAA's standards for a neutral arbitrator in section
13-22-211(2), C.R.S. 2016. We find no error because the
policy does not incorporate, and the parties' stipulation
was not sufficiently specific to require application of, the
CUAA's standards, in particular section 13-22-211(2).
9 The appraisal provision of the policy states:
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 the 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 will submit their differences to the umpire. A decision
agreed to by any two will be binding.
10 At the hearing, the parties initially stipulated orally
that the CUAA applies to their appraisal dispute. The trial
court's order did not state whether it was applying any
of the CUAA provisions. The UAA provides the parties with
choices to be made regarding whether to have party
arbitrators or impartial arbitrators. Because the
parties' stipulation here did not specify whether the
appraisers were to be treated as arbitrators, and if so,
whether they were to be held to the statutory standard for
impartial arbitrators, the UAA sections regarding disclosures
to be made by impartial arbitrators did not apply.
See sections 13-22-211 and 13-22-212, C.R.S. 2016.
11 Because of these ambiguities, Owners has not established
that, even if Dakota's appraiser violated the CUAA,
reversal would be required. Also, at least one other court
has concluded an identical appraisal provision was not
subject to the CUAA. Auto- Owners Ins. Co. v. Summit
Park, 129 F.Supp.3d 1150, 1152-55 (D. Colo. 2015)
(applying Colorado law).
Appraiser Impartiality Under Insurance Policy
12 Whether Haber was an "impartial appraiser" under
the insurance policy turns on the meaning of that term, which
we must construe.
Standard of Review
13 We review the interpretation of contracts de novo.
Fibreglas Fabricators, Inc. v. Kylberg, 799 P.2d
371, 374 (Colo. 1990).
14 The primary goal of contract interpretation is to give
effect to the intent of the parties. Ad Two, Inc. v. City
& Cty. of Denver, 9 P.3d 373, 376 (Colo. 2000). We
determine the parties' intent by looking to the plain and
generally accepted meaning of the contractual language.
Copper Mountain, Inc. v. Indus. Sys., Inc., 208 P.3d
692, 697 (Colo. 2009).
15 "The meaning and effect of a contract are to be
determined from a review of the entire instrument, not merely
from isolated clauses or phrases. A contract should be
interpreted to harmonize and, if possible, to give effect to
all its provisions." First Christian Assembly of
God, Montbello v. City & Cty. of Denver, 122 P.3d
1089, 1092 (Colo.App. 2005) (alteration omitted) (citation
16 "The overriding rules of contract interpretation
require a court to apply the plain meaning of the words used
subject to interpretation from the context and circumstances
of the transaction." Id. (citations omitted).
17 Written contracts that are complete and free from
ambiguity will be found to express the intention of the
parties and will be enforced according to their plain
language. Ad Two, 9 P.3d at 376. A contract
provision is ambiguous if it is reasonably susceptible of
more than one meaning. Cheyenne Mountain Sch. Dist. No.
12 v. Thompson, 861 P.2d 711, 715 (Colo. 1993).
B. Impartiality Under This Policy
18 The only policy requirement clearly applicable to
Haber's conduct is the policy provision providing that in
the event the insured and the insurer disagree on the amount
of the loss, either may demand an "appraisal" and
each "will select a competent and impartial
appraiser." The phrase "impartial appraiser"
is not further defined in the policy. Thus it was the trial
court's task to determine the meaning of the provision
and whether Haber met the criteria of an impartial appraiser.
19 Although the phrase appears in many insurance policies,
apparently no Colorado appellate court has construed it.
See Auto-Owners Ins. Co. v. Summit Park Townhome
Ass'n, No. 14-CV-03417-LTB, 2016 WL 1321507, at *4-7
(D. Colo. Apr. 5, 2016) (unpublished mem. opinion and
20 The trial court determined the appraisers provided for in
this policy need not be impartial in the same manner as a
judge, umpire, or arbitrator. Rather, they needed to be
impartial in the sense that experts at a trial, such as a
forensic chemist, need to be: rendering their opinions based
on their experiences and not allowing themselves to be
influenced by the litigants. We understand this to mean that
an impartial appraiser in rendering his or her valuation
opinion applies appraisal principles with fairness, good
faith, and lack of bias. We conclude this is the correct
reading of the policy provision and its intent.
21 We first note that because the policy does not define
"impartial, " any ambiguity in the term is
construed against Owners, who drafted the policy. Union
Ins. Co. v. Houtz, 883 P.2d 1057, 1061 (Colo. 1994)
("Once an ambiguity in the policy language is found, it
is construed against the drafter of the document and in favor
of the insured.").
22 We then consider the context in which the term is used.
Owners contends the word "impartial" has a common
and usual meaning. Citing to Black's Law Dictionary,
Owners asserts that "impartial" means "not
favoring one side more than another; unbiased and
disinterested; unswayed by personal interest." While we
agree that an impartial appraiser should be unbiased and
unswayed by personal financial interest, like an expert
witness at trial, we do not agree that the impartial
appraiser called for in this policy may not favor one side
more than the other. We reach this conclusion from the
context of the policy provision taken as a whole.
23 The relevant paragraph of the policy goes on to provide
that the two appraisers will select an "umpire, "
and if the two appraisers fail to agree on the amount of
loss, they will submit their differences to the umpire.
Therefore, this language distinguishes the
"impartial" appraisers from the umpire. Under this
method, no one appraiser determines the final outcome; rather
it is left to the umpire to resolve the differences between
the appraisers. The policy plainly contemplates that the
appraisers will put forth a ...