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The Steeplechase II Condominium Association, Inc. v. The Travelers Indemnity Co.

United States District Court, D. Colorado

December 13, 2018

THE STEEPLECHASE II CONDOMINIUM ASSOCIATION, INC., a Colorado non-profit corporation, Plaintiff,
THE TRAVELERS INDEMNITY COMPANY, a foreign corporation, Defendant.



         This matter is before the Court on Plaintiff's Motion for Partial Summary Judgment [Docket No. 31], Travelers Indemnity Company's Motion for Summary Judgment [Docket No. 35], and Defendant Travelers Indemnity Company's Motion to Exclude Testimony Under Fed.R.Evid. 702 [Docket No. 45]. The Court has jurisdiction pursuant to 28 U.S.C. § 1332.

         I. BACKGROUND[1]

         This case involves a dispute between the parties over payment of plaintiff's insurance claim for hail damage. Plaintiff is a homeowner's association located in Littleton, Colorado. Docket No. 1 at 2, ¶ 5. At all times relevant to this action, plaintiff held an insurance policy with defendant. Docket No. 35 at 3, ¶ 3.[2] The policy includes a provision stating that “[n]o one may bring a legal action against [defendant] under this policy unless . . . [t]he action is brought . . . within 2 years after the date on which the direct physical loss or damage occurred.” Docket No. 36 at 5, ¶ 20.

         On June 14, 2014, plaintiff's property suffered damage as the result of a hail and wind storm. Docket No. 35 at 3, ¶ 2; Docket No. 31 at 2, ¶ 1 (indicating date of loss of June 14, 2014). As early as July 28, 2014, plaintiff believed that it was owed a full roof replacement due to significant hail damage. Docket No. 35 at 5, ¶ 11.[3] Plaintiff filed a claim with defendant on or about August 8, 2014. Docket No. 31 at 2, ¶ 2. Altitude Property Claims, defendant's third-party adjuster, performed an inspection of the property's roofs and subsequently provided a report of damages on August 29, 2014. Docket No. 31 at 3, ¶ 3. The report found a total of seven wind-damaged shingles and hail damage to the metal vent caps on all eight buildings. Id.; Docket No. 35 at 3, ¶ 6. The report further noted that the roofs had prior shingle repairs that did not match the original shingles. Docket No. 35 at 3, ¶ 6. Plaintiff's representative, Bryan Gramke of Heritage Roofing, was present and agreed with Altitude's assessment. Docket No. 35 at 4, ¶ 7.

         On September 5, 2014, defendant sent plaintiff a letter with its estimate, which did not include a full replacement of the roofs and was below plaintiff's deductible. Docket No. 31 at 3, ¶ 4. Plaintiff's board knew of the denial of the full roof replacement that fall. Docket No. 35 at 5, ¶ 12. On January 23, 2015, Heritage informed defendant that the original shingles were unavailable to replace the damaged shingles. Docket No. 35 at 5, ¶ 14. Defendant responded that it would not pay for a full removal and replacement of the property's roofs, and that the shingles could be replaced using a similar shingle. Id. at 5-6, ¶ 15. Heritage subsequently informed plaintiff of defendant's coverage decision. Id. at 6, ¶ 16. After Heritage repaired the roofs in March 2015, defendant issued payment to plaintiff in August 2015 for the recoverable depreciation. Id., ¶¶ 17-18.

         On September 26, 2016, plaintiff hired a public adjuster, Scott Benglen. Docket No. 31 at 3, ¶ 7. Mr. Benglen sent a letter to defendant on November 15, 2016 stating that he had been retained by plaintiff to adjust the claim. Docket No. 35 at 6-7, ¶ 19. Mr. Benglen argued that, because a suitable match for the shingles did not exist, defendant should pay for a full roof replacement. Id. Defendant agreed to re-inspect the property, but limited the re-inspection to damages documented in the initial estimate. Id. at 7, ¶ 20. After re-inspection, defendant sent a letter to Mr. Benglen indicating that it would not pay to replace the property's roofs because the roof had been repaired with non-matching shingles prior to the loss. Id., ¶ 21.

         Plaintiff filed this action on May 25, 2017, alleging claims for breach of contract and statutory bad faith under Colo. Rev. Stat. § 10-3-1115 as a result of defendant's denial of coverage. Docket No. 1.


         Summary judgment is warranted under Federal Rule of Civil Procedure 56 when 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); see Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-50 (1986). A disputed fact is “material” if under the relevant substantive law it is essential to proper disposition of the claim. Wright v. Abbott Labs., Inc., 259 F.3d 1226, 1231-32 (10th Cir. 2001). Only disputes over material facts can create a genuine issue for trial and preclude summary judgment. Faustin v. City & Cty. of Denver, 423 F.3d 1192, 1198 (10th Cir. 2005). An issue is “genuine” if the evidence is such that it might lead a reasonable jury to return a verdict for the nonmoving party. Allen v. Muskogee, 119 F.3d 837, 839 (10th Cir. 1997).

         Where “the moving party does not bear the ultimate burden of persuasion at trial, it may satisfy its burden at the summary judgment stage by identifying a lack of evidence for the nonmovant on an essential element of the nonmovant's claim.” Bausman v. Interstate Brands Corp., 252 F.3d 1111, 1115 (10th Cir. 2001) (internal quotation marks omitted) (quoting Adler v. Wal-Mart Stores, Inc., 144 F.3d 664, 671 (10th Cir. 1998)). “Once the moving party meets this burden, the burden shifts to the nonmoving party to demonstrate a genuine issue for trial on a material matter.” Concrete Works of Colo., Inc. v. City & Cty. of Denver, 36 F.3d 1513, 1518 (10th Cir. 1994). The nonmoving party may not rest solely on the allegations in the pleadings, but instead must designate “specific facts showing that there is a genuine issue for trial.” Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986) (internal quotation marks omitted). “To avoid summary judgment, the nonmovant must establish, at a minimum, an inference of the presence of each element essential to the case.” Bausman, 252 F.3d at 1115. When reviewing a motion for summary judgment, a court must view the evidence in the light most favorable to the non-moving party. Id.

         III. ANALYSIS

         Defendant moves for summary judgment on plaintiff's claims for breach of contract and insurance bad faith under Colo. Rev. Stat. § 10-3-1115. Docket No. 35. Plaintiff filed a cross motion for summary judgment on defendant's affirmative defense that plaintiff's breach of contract claim is time-barred. Docket No. 31.

         A. ...

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