United States District Court, D. Colorado
ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY
JUDGMENT AND DENYING PLAINTIFF'S MOTION FOR SUMMARY
JUDGMENT ON DEFENDANT'S DEFENSES
CHRISTINE M. ARGUELLO JUDGE
This
matter is before the Court on Plaintiff Jenny Ramos'
Motion for Summary Judgment on Defendant's Defenses (Doc.
# 67) and Defendant Hertz Corporation's Amended Motion
for Summary Judgment (Doc. # 72). 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.
I.
BACKGROUND
This
case involves an insurance dispute arising out of an
automobile collision. On March 7, 2014, Allen
George[1] rented a car from Defendant. Mr. George
did not purchase any insurance from Defendant, and the rental
agreement that Mr. George executed indicated that no other
person was permitted to use the car without prior written
authorization from Defendant. (Doc. # 72 at 3.) However, on
April 5, 2014, Mario Benavides was driving the rental car,
and he collided with Plaintiff's car. Mr. Benavides did
not have Defendant's written authorization to drive the
car.
It is
undisputed that Mr. Benavides' driver's license was
revoked for being a habitual traffic offender in 2009, and
his license had not been reissued at the time of the
collision. (Doc. # 70-5 at 3.) It is also undisputed that Mr.
Benavides was under the influence of drugs and or alcohol
while he was driving. (Doc. # 70-6.)
At the
time of the April 5, 2014 collision, Defendant was insured by
an insurance policy (“the Policy”) that was
issued by ACE USA. (Doc. # 70-3.) The Policy provided limited
coverage to individuals who rented cars from Defendant even
if the renters declined to purchase insurance directly from
Defendant, and it also provided coverage to individuals who
were not renters under certain circumstances.[2] The Policy limit
for bodily injury was $25, 000 for each person and $50, 000
per accident, and the limit for property damage was $25, 000.
(Id. at 7.)
On
August 3, 2014, Plaintiff's counsel sent Defendant a
demand letter which contained various medical records
purporting to show some of the harm Plaintiff sustained as a
result of the collision. (Doc. # 72 at 8.) The letter
demanded that Defendant pay the insurance policy limits of
$25, 000, and it set an unreasonable deadline of one month
for Defendant to tender such payment, after which the offer
to settle would be automatically withdrawn. Although
Defendant made a counteroffer of $14, 806.09 (Doc. # 75 at
3), Plaintiff rejected that offer, and twelve days after the
deadline, on September 15, 2014, Plaintiff sued Mr. Benavides
and Mr. George in Colorado state court (Doc. # 70-8).
Defendant was not a party to that case.
Subsequently,
Plaintiff and Mr. Benavides entered into an agreement,
according to which Mr. Benavides agreed to participate in
arbitration. (Doc. # 70-10 at 1.) Mr. Benavides further
agreed to assign to Plaintiff “all rights, title, and
interest [Mr. Benavides] may have to claims against
[Defendant] for collection of the judgment entered in the
[state court] Lawsuit, including the rights to prosecute
those claims in a civil action and retain the proceeds from
such an action.” (Id. at 2.) In exchange,
Plaintiff promised “not to execute on or otherwise
attempt to enforce any judgment resulting from the
arbitration against [Mr.] Benavides . . . .”
(Id.)
The
one-day arbitration hearing took place on Wednesday,
September 27, 2016. (Doc. # 70-11 at 2.) Mr. Benavides was
not present at the hearing, and his counsel did not enter an
appearance. Additionally, Defendant, who was not a party to
the case, did not attend the hearing despite an invitation
from Plaintiff. Thus, the only evidence that formed the basis
of the arbiter's decision was produced by Plaintiff. On
November 22, 2016, the arbiter issued Plaintiff an award of
$3, 426, 729.85.[3]
In the
instant case, Plaintiff seeks recovery of the $3, 426, 729.85
arbitration award from Defendant under theories of breach of
contract and bad faith insurance practices claims based on
the car rental agreement between Plaintiff and Mr. Benavides.
Both claims are based on the premise that Defendant is
obligated-either as an insurer or third-party insurance
policy administrator-to indemnify Mr. Benavides, as an
insured, for the judgment entered against him in state court.
II.
SUMMARY JUDGMENT STANDARD
Summary
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
Cir. 2004).
The
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)).
Once
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
...