Searching over 5,500,000 cases.


searching
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.

Kuzava v. United Fire & Casualty Co.

United States District Court, D. Colorado

July 31, 2018

TIMOTHY KUZAVA, as assignee of Eric Kubby and Lyon Trucking Inc., and KATHY JO KUZAVA, as assignee of Eric Kubby and Lyon Trucking Inc., Plaintiffs,
v.
UNITED FIRE & CASUALTY COMPANY, Defendant.

          ORDER AFFIRMING IN PART AND REJECTING IN PART RECOMMENDATION OF

          CHRISTINE M. ARGUELLO UNITED STATES DISTRICT JUDGE

         This matter is before the Court on the Recommendation of United States Magistrate Judge Nina Y. Wang (Doc. # 36), wherein she recommends that the Court grant Defendant's Rule 12(b)(1) Motion to Dismiss Plaintiffs' Amended Complaint or, in the Alternative, Motion to Stay Proceedings (Doc. # 12). Plaintiffs timely filed an Objection to Magistrate Judge Wang's Recommendation on March 19, 2018 (Doc. # 37), to which Defendant responded on April 2, 2018 (Doc. # 38).

         The Court has conducted a de novo review of this matter, including all relevant pleadings, the Recommendation, Plaintiffs' Objection thereto and Defendant's Response. The Court affirms the Recommendation's conclusion that Plaintiffs' claims are unripe.

         I. BACKGROUND

         This case stems from a car accident between Timothy and Kathy Jo Kuzava (collectively, “Plaintiffs”) and Eric Kubby. (Doc. # 7 at ¶ 5.) At the time of the accident, Mr. Kubby was operating a truck owned by Lyon Trucking, Inc.; both Mr. Kubby and Lyon Trucking were insured by United Fire & Casualty Company (“United” or “Defendant”). (Doc. # 12 at 2.) Following the accident, Plaintiffs brought personal injury claims against Mr. Kubby and Lyon Trucking in the District Court of Eagle County, Colorado (the “Underlying Action”). (Id.) In compliance with the insurance policy, United agreed to defend Mr. Kubby and Lyon Trucking (collectively, “Insureds”), in the Underlying Action. (Id.)

         The Underlying Action was scheduled for trial beginning June 20, 2016, (Doc. # 12-4), but, on May 27, 2016, Insureds entered into a Change of Venue Agreement and Assignment of Claims with Plaintiffs (the “Agreement”). (Doc. # 12-5.) In the Agreement, Plaintiffs and Insureds acceded to a number of terms including that (1) they would change venue and arbitrate the claimed damages before a neutral fact-finder; (2) Insureds would assign to Plaintiffs the rights and interests in any and all present and future claims under the Policy against United; and (3) Plaintiffs would not execute or enforce any judgment resulting from the arbitration against Insureds. (Id. at 3-4.) Subsequent to the Agreement, Plaintiffs filed an unopposed Motion to Change Venue and Vacate the Trial Date, which was granted on June 3, 2016. (Doc. # 12-6.)

         On June 20, 2016, United moved to intervene in the Underlying Action as a matter of right to bar the arbitration proceedings. (Doc. # 12 at 3.) United also sought injunctive and declaratory relief including: (1) a stay of the pending arbitration; (2) a declaration that the Agreement was invalid and void as contrary to public policy; and (3) a declaration that it owed no further defense or indemnification obligations to Insureds. (Doc. # 12-8.)

         Plaintiffs and Insureds nevertheless went forward with arbitration on July 11, 2016. (Doc. # 12 at 4.) During the arbitration proceeding, United provided a defense to Insureds, but it did not participate as a party. (Id.) The arbitration proceedings resulted in an award of more than $3, 000, 000 for Plaintiffs. (Id.) The Eagle County District Court subsequently entered judgment on May 1, 2017, and denied United's Motion to Intervene as moot on May 4, 2017. (Doc. # 12-11.)

         On June 16, 2017, Defendant filed an appeal of the denial of its Motion to Intervene in the Underlying Action, which is currently pending before the Colorado Court of Appeals. (Doc. # 12-12.) In the appeal, Defendant also seeks reversal of the judgment, contending that “reversal of the district court's ruling on [Defendant's] motion to intervene alone is not an adequate remedy[.]” (Doc. # 38 at 6.)

         Plaintiffs, in their capacity as assignees of Insureds, initiated the present action by filing a complaint against Defendant in state court on September 6, 2017. (Doc. # 1-1.) Plaintiffs assert two claims against Defendant: (1) breach of insurance contract, and (2) bad faith. (Doc. # 7.) On November 8, 2017, Defendant invoked diversity jurisdiction to remove the action to this Court. (Doc. # 1.) On November 15, 2017, Defendant filed a Rule 12(b)(1) Motion to Dismiss or, in the Alternative, Motion to Stay Proceedings. (Doc. # 12.)

         In the 12(b)(1) Motion, Defendant seeks dismissal of both the breach of contract and bad faith claims, arguing that they are not ripe for judicial review because of Defendant's pending appeal in the Underlying Action. (Doc. # 12 at 6.) Defendant contends that, if it wins the appeal and the Colorado Court of Appeals finds Defendant's intervention should have been granted prior to the arbitration, then “[that] proceeding and the result thereof will be void as to [Defendant;]” moreover, “all proceedings in this Court (which are based upon the Award) will [also] be nullified.” (Id.)

         In response to Defendant's Motion, Plaintiffs contend that the injuries on which their bad faith and breach of contract claims are based occurred upon entry of judgment. (Doc. # 22.) Therefore, Plaintiffs argue, Defendant's appeal and the final outcome of the Underlying Action are irrelevant to the ripeness of their claims. (Id.)

         Now before the court is the Recommendation of Magistrate Judge Wang wherein she agrees with Defendant that Plaintiffs' claims are unripe. (Doc. # 36.) Magistrate Judge Wang, therefore, recommends that the Court grant Defendant's Motion to Dismiss and dismiss Plaintiffs' Complaint without prejudice, or, in the alternative, that the Court stay the proceedings.

         II. STANDARD OF REVIEW

         When a magistrate judge issues a recommendation on a dispositive matter, Federal Rule of Civil Procedure 72(b)(3) requires that the district judge “determine de novo any part of the magistrate judge's [recommended] disposition that has been properly objected to.” Plaintiff has filed an Objection to the Recommendation, essentially challenging the Recommendation in its entirety. (Doc. # 37.) The Court will therefore conduct a de novo review of the issues. In so doing, the Court “may accept, reject, or modify the recommended disposition; receive further evidence; or return the matter to the magistrate judge with ...


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.