United States District Court, D. Colorado
ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY
JUDGMENT AND DENYING PLAINTIFF'S MOTION FOR PARTIAL
CHRISTINE M. ARGUELLO UNITED STATES DISTRICT JUDGE
matter is before the Court on Plaintiff Michael Bethel's
Motion for Partial Summary Judgment (Doc. # 55) and Defendant
Berkshire Hathaway Homestate Insurance Company's Motion
for Summary Judgment (Doc. # 63). Both motions have been
fully briefed. (Doc. ## 64, 81, 82, 89.) Having thoroughly
reviewed the underlying briefing, pertinent record, and
applicable law, the Court grants Defendant's Motion and
denies Plaintiff's Motion for the following reasons.
property insurance dispute arises from a fire that occurred
at 701 Sycamore Ave. in Rocky Ford, Colorado on December 18,
2016. (Doc. # 55 at 1.) The property (“Covered
Property”) was insured by Defendant, and the policy
(“Policy”) was in effect at the time of the fire.
Defendant investigated the incident and determined that the
fire was accidental in nature and that the Covered Property
suffered a total loss which was covered by the Policy.
had purchased the Covered Property for $100, 000 in May 2016
from a friend who had loaned the money to him for the
transaction. (Doc. # 63 at 1; Doc. # 65 at 3-4.) The Policy
was an “Actual Cash Value” policy with a limit of
$407, 000. After the fire, Defendant retained a certified
real estate appraiser who determined that the market value of
the Covered Property was $109, 000 at the time of the
December 18, 2016 fire. (Doc. # 63 at 1-5.)
upon the appraisal, Defendant determined that the value of
the of the Covered Property was $109, 000 at the time of the
loss. By a letter dated April 3, 2017, Defendant issued
payment to Plaintiff for $79, 000, which represented the
value of the Covered Property less the $30, 000 advance
Defendant had paid Plaintiff on March 1, 2017, while the
appraisal process was being completed. (Id.)
April 3 letter also advised Plaintiff of the terms of the
debris removal coverage available under the Policy, including
the requirement that such expenses be reported to Defendant
within 180 days of the date of loss. The letter noted that
Plaintiff had previously submitted a bid he had received for
debris removal but no actual invoices. Defendant requested
that Plaintiff send “the invoices, evidence of payment,
and any other applicable documentation for the debris removal
expense associated with the Claim.” (Doc. # 63-1 at
186.) Thereafter, Plaintiff did not submit evidence of
payment for any debris removal expenses, and as of June 13,
2018, Plaintiff had not begun debris removal work at the
subsequently initiated the instant action, claiming that he
is entitled to the policy limit of $407, 000 rather than the
Covered Property's market value of $109, 000.
SUMMARY JUDGMENT STANDARD
judgment is warranted 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). A fact is “material” if it is
essential to the proper disposition of the claim under the
relevant substantive law. Wright v. Abbot Labs.,
Inc., 259 F.3d 1226, 1231-32 (10th Cir. 2001). A dispute
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, Okl., 118 F.3d
837, 839 (10th Cir. 1997). When reviewing motions for summary
judgment, a court may not resolve issues of credibility, and
must view the evidence in the light most favorable to the
nonmoving party-including all reasonable inferences from that
evidence. Id. However, conclusory statements based
merely on conjecture, speculation, or subjective belief do
not constitute competent summary judgment evidence. Bones
v. Honeywell Int'l, Inc., 366 F.3d 869, 875 (10th
moving party bears the initial burden of demonstrating an
absence of a genuine dispute of material fact and entitlement
to judgment as a matter of law. Id. In attempting to
meet this standard, a movant who does not bear the ultimate
burden of persuasion at trial does not need to disprove the
other party's claims; rather, the movant need simply
point the court to a lack of evidence for the other party on
an essential element of that party's claim. Adler v.
Wal-Mart Stores, Inc., 144 F.3d 644, 671 (10th Cir.
1998) (citing Celotex Corp. v. Catrett, 477 U.S.
317, 325 (1986)).
the movant meets its initial burden, the burden then shifts
to the nonmoving party to “set forth specific facts
showing that there is a genuine issue for trial.”
Anderson v. Liberty Lobby Inc., 477 U.S. 242, 256
(1986). The nonmoving party may not simply rest upon its
pleadings to satisfy this burden. Id. Rather, the
nonmoving party must “set forth specific facts that
would be admissible in evidence from which a rational trier
of fact could find for the nonmoving party.”
Adler, 144 F.3d at 671. “To accomplish this,
the facts must be identified by reference to affidavits,
deposition transcripts, or specific exhibits incorporated
therein.” Id. Ultimately, the Court's
inquiry on summary judgment is whether the facts and evidence
identified by the parties present “a sufficient
disagreement to require submission to a jury or whether it is
so one-sided that one party must prevail as a matter of
law.” Anderson, 477 U.S. at 251-52.
policies are interpreted as a matter of law by the Court.
Allstate Ins. Co. v. Huizar, 52 P.3d 816, 819 (Colo.
2002); Smith v. State Farm Mut. Auto. Ins. Co., 2017
COA 6, ¶ 6. Additionally, under Colorado law, courts
“construe insurance policies according to principles of
contract interpretation.” MarkWest Energy Partners,
L.P. v. Zurich Am. Ins. Co., 2016 COA 110, ¶ 13
(citing Shelter Mut. Ins. Co. v. Mid-Century Ins.
Co., 214 P.3d 489, 492 (Colo.App. 2008),
aff'd, 246 P.3d 651 (Colo. 2011)). Therefore,
courts enforce the plain language of the policy unless it is
ambiguous. Hoang v. Assurance Co. of Am., 149 P.3d
798, 801 (Colo. 2007). Moreover, in the absence of ambiguity,
the intent of the parties is to be determined by the language
of the policies themselves, not by extrinsic evidence.
Radiology Prof'l Corp. v. Trinidad Area Health
Ass'n, Inc., 577 P.2d 748, 750 (Colo. 1978); DTC
Energy Grp., No. 17-cv-01718-PAB-KLM, 2018 WL 305733, at
*3 (D. Colo. Jan. 4, 2018).
raises three claims for relief: breach of contract;
unreasonable delay or denial of an insurance claim; and
common law bad faith. (Doc. # 1 at 3-4.) The Court will
consider each claim in turn.
WHETHER DEFENDANT BREACHED ITS POLICY OBLIGATIONS
order to prevail on a breach of contract claim, a plaintiff
must prove that the parties entered into a contract; the
defendant failed to perform its obligations under the
contract; and the plaintiff substantially complied with its
obligations. Children's Hosp. Colo. v. Digisonics,
Inc., No. 16-cv-00011-RBJ, 2017 WL 2778521, at *3, (D.
Colo. June 27, 2017) (citing W. Distrib. Co. v.
Diodosio, 841 P.2d 1053, 1058 (Colo. 1992)). Plaintiff
argues that Defendant breached its contractual obligations by
“failing to perform its obligations under the contract,
including failing to pay [Plaintiff] the actual cash value of
his [p]roperty, and failing to pay him other benefits owed to
him under the Policy, including but not limited to debris
removal benefits.” (Doc. # 1 at 3.) Defendant, by
contrast, argues Plaintiff cannot prove a breach of contract
claim with respect to (1) the building coverage or (2) the
debris removal coverage. (Doc. # 63 at 6, 14.)
Policy contains a Building and Personal Property Coverage
Form which indicates Defendant “will pay for direct
physical loss of or damage to Covered Property . . . caused
by or resulting from any Covered Cause of Loss.” (Doc.
# 63-1 at 26.) The coverage is subject to various conditions.
(Id. at 33.) Specifically, the Policy indicates:
the event of loss or damage covered by this Coverage Form,
at our option, we will either:
(1) Pay the value of lost or damaged property;
(2) Pay the cost of repairing or replacing the lost or
damaged property . . .;
(3) Take all or any part of the property at an agreed or
appraised value; or
(4) Repair, rebuild or replace the property with other
property of like kind and quality . . . .
We will not pay you more than your financial interest in
the Covered Property.
at 35) (emphasis added). Thus, the plain language of the
Policy provides Defendant with the option to, inter
alia, pay insureds either the value of the property or
the cost of repairing or replacing the property, subject to
the limit of the insured's financial interest in the
property. With respect to the method of valuation, the Policy
indicates that Defendant will “determine the value of
Covered Property in ...