United States District Court, D. Colorado
OPINION AND ORDER ON MOTION FOR SUMMARY
S. KRIEGER CHIEF UNITED STATES DISTRICT JUDGE.
MATTER comes before the Court upon the
Defendant's Motion for Summary Judgment (#
48), the Plaintiff's Response (#
52), and the Defendant's Reply (#
53). For the reasons that follow, the motion is
Court exercises jurisdiction under 28 U.S.C. § 1332.
a case in which the Plaintiff, Wak Inc. (Wak) seeks to
recover insurance benefits for hail damage. Wak owns
commercial property located in Denver, Colorado, which was
insured under a casualty insurance policy (Policy) issued by
Liberty Mutual Insurance and underwritten by Defendant Ohio
Security Insurance Co. (Ohio) In May 2014, Wak's property
was damaged in a hail storm. Wak submitted an insurance claim
to Ohio, which determined that the value of the claim was
$734.92, below Wak's $1, 000 deductible. As a result,
Ohio issued a “partial denial” in July 2014 and
did not pay the claim.
July 2014, Wak personnel made numerous phone calls to Ohio in
which they stated that Wak intended to hire its own engineer
to inspect the property. Wak brought suit in May 2015, but
voluntarily dismissed it without prejudice.
September 2015, Wak invoked the appraisal provision of the
Policy. Ohio requested a sworn proof of loss and provided the
necessary forms. Wak submitted its proof of loss in the
amount of $213, 868.31 in November 2015. While the parties
moved through the appraisal process, Ohio requested Wak
refrain from commencing repairs so it could reinspect the
property. The reinspection was delayed a few times due to
weather and appraiser availability. Ultimately, the parties
submitted their position statements to the umpire in July
2016, and a hearing was held in August 2016. In September,
the umpire issued an appraisal award of $136, 032.78 for
replacement cost and $91, 822.12 in actual cash value. Ohio
promptly paid, and Wak accepted that sum.
brought this suit in May 2016 before the Policy's statute
of limitations expired, and the parties jointly moved to
administratively close the case while they completed the
appraisal process (# 19). Wak asserted three
causes of action: (1) breach of contract based on
denial/failure to pay its insurance claim, (2) breach of the
implied covenant of good faith and fair dealing based on
denial of the claim and forcing Wak to submit to the
appraisal process, and (3) a violation of C.R.S. §§
10-3-1115, 1116 based on unreasonable delay of the claim. The
Court sua sponte raised concerns (#
38) as to its subject-matter jurisdiction because
the action was filed before the appraisal was complete, and
according to the Policy. It appeared that completion of the
appraisal process was a condition precedent to Ohio's
obligation to pay and thus to Wak's breach-of-contract
claim for failure to pay. After briefing on the subject, the
Court issued an order addressing Wak's standing to sue
and dismissing the breach-of-contract claim. The other two
claims remain. Ohio now moves for summary judgment on both
claims (# 48).
of the Federal Rules of Civil Procedure facilitates the entry
of a judgment only if no trial is necessary. See White v.
York Int'l Corp., 45 F.3d 357, 360 (10th Cir. 1995).
Summary adjudication is authorized when there is no genuine
dispute as to any material fact and a party is entitled to
judgment as a matter of law. Fed.R.Civ.P. 56(a). Substantive
law governs what facts are material and what issues must be
determined. It also specifies the elements that must be
proved for a given claim or defense, sets the standard of
proof, and identifies the party with the burden of proof.
See Anderson v. Liberty Lobby Inc., 477 U.S. 242,
248 (1986); Kaiser-Francis OilCo.v.Producer=sGasCo.,
870 F.2d 563, 565 (10th Cir. 1989). A factual dispute is
“genuine” and summary judgment is precluded if
the evidence presented in support of and opposition to the
motion is so contradictory that, if presented at trial, a
judgment could enter for either party. See Anderson,
477 U.S. at 248. When considering a summary judgment motion,
a court views all evidence in the light most favorable to the
non-moving party, thereby favoring the right to a trial.
See Garrett v. Hewlett Packard Co., 305 F.3d 1210,
1213 (10th Cir. 2002).
the moving party does not have the burden of proof at trial,
it must point to an absence of sufficient evidence to
establish the claim or defense that the non-movant is
obligated to prove. If the respondent comes forward with
sufficient competent evidence to establish a prima
facie claim or defense, a trial is required. If the
respondent fails to produce sufficient competent evidence to
establish its claim or defense, then the movant is entitled
to judgment as a matter of law. See Celotex Corp. v.
Catrett, 477 U.S. 317, 322-23 (1986).
action arises solely from the parties' disagreement as to
the amount of Wak's loss. In viewing the parties'
arguments, it is helpful to keep in mind two provisions of
first provision lists the insured's duties in the event
of loss, which include the duty to submit a sworn proof of
Send us a signed, sworn proof of loss containing the
information we request to investigate the claim. You must do
this within 60 days after our request. (# 48-11 at
undisputed that although the hail storm occurred in 2014.
Although Wak disagreed with Ohio's initial quantification
of its loss, Wak did not submit its sworn proof of loss to
Ohio until November 2015.
second provision states that if the parties disagree as to
the amount of loss, either can invoke an appraisal process:
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 ...