Carnival v. Geico Cas. Co.
| Decision Date | 28 March 2017 |
| Docket Number | Civil Action No. 15-cv-02581-PAB-MEH |
| Parties | NICHOLAS CARNIVAL, Plaintiff, v. GEICO CASUALTY COMPANY, Defendant. |
| Court | U.S. District Court — District of Colorado |
ORDER
This matter is before the Court on defendant's motion for partial summary judgment [Docket No. 26] and defendant's motion in limine [Docket No. 27]. The Court has jurisdiction pursuant to 28 U.S.C. § 1332.
Plaintiff Nicholas Carnival is a Colorado State Patrol officer. Docket No. 26 at 2, ¶ 1. On May 12, 2014, he was injured in a motor vehicle accident while working. Id. As a result, he was entitled to workers' compensation benefits. Id., ¶ 3. The driver of the other vehicle, who was at fault, had a motor vehicle insurance policy with a limit of $100,000. Id., ¶ 2. Plaintiff had purchased an automobile insurance policy from defendant GEICO Casualty Company that included underinsured motorist ("UIM")coverage with a $50,000 limit per individual. Id. at 3, ¶ 5 (citing Docket No. 26-3 at 3). Such UIM policies provide additional insurance that "cover[s] the difference, if any, between the amount of the limits of any legal liability coverage and the amount of the damages sustained . . . up to the maximum amount of the coverage obtained." Colo. Rev. Stat. § 10-4-609(1)(c).
Plaintiff received $97,882.07 in workers' compensation benefits. Docket No. 26 at 2-3, ¶ 3 (citing Docket No. 26-2 at 1, 8-9). On June 22, 2015, Dr. Theodore Villavicencio performed a medical examination as part of the workers' compensation process. Id. Using the statutorily required criteria, Dr. Villavicencio found that plaintiff had a whole body impairment rating of 15%. Id. This 15% disability rating was used as part of a statutory formula to arrive at the $74,585.79 benefit for permanent partial disability ("PPD"). Docket No. 26-2 at 1. Additionally, plaintiff's workers' compensation benefits included $21,043.33 for medical expenses and $2,252.95 for temporary partial disability ("TPD"). Docket No. 26-2 at 1.
On August 21, 2015, plaintiff settled his claims against the at-fault driver for the $100,000 policy limit. Docket No. 26 at 2, ¶ 2 (citing Docket No. 26-1 at 4, 79:23-80:4). That same day, plaintiff sent a letter to defendant offering to settle for the UIM policy limit. Docket No. 26-5; see also Docket No. 26-3 at 3.
Defendant's claims adjuster evaluated plaintiff's claim and, without reference to the workers' compensation settlement funds, considered plaintiff to be "well compensated" by the $100,000 settlement with the at-fault driver's insurance company despite the 15% whole person impairment rating. Docket No. 36-8 at 3. Defendant sent plaintiff a letter with a "nuisance offer" of $1,000 without explaining how defendantarrived at that figure. Id. at 1; Docket No. 36-5 at 1. Settlement negotiations ensued.
Plaintiff's counsel responded with a letter noting the workers' compensation evaluation indicated permanent physical impairment and stating, "any money my client receives from the bodily injury provider, which only has a $100,000 insurance policy, he has to return in subrogation [to the workers' compensation insurer], at this moment, approximately $95,000." Docket No. 36-4 at 1. Defendant asked for documentation of the subrogated claim, stating "it is our position that Mr. Carnival was well compensated by the bodily injury carrier's policy limits of $100,000.00," and again offering $1,000. Docket No. 36-5. Plaintiff's counsel responded by citing Colo. Rev. Stat. § 10-4-609 and arguing that the entire $97,882.07 was subrogated. Docket No. 36-6 at 1. Defendant gave permission for plaintiff to settle with the at-fault driver's insurance and requested plaintiff's counsel make contact "once settlement is reached regarding the underinsured motorist claim."2
Correspondence between GEICO claims handlers indicates there was uncertainty about whether plaintiff would be required to repay the entire amount of his workers' compensation settlement from the proceeds of his settlement with the at-fault driver. Docket No. 36-8. Defendant's claims adjuster expressed doubt that plaintiff would have to repay the full amount, but nevertheless reasoned that plaintiff received Id. at 1. Further exchanges resulted in defendant raising its settlement offer to $5,000, but maintaining that plaintiff's damages were compensated by his settlement with the at-fault driver. Docket No. 36-9 at 1. Defendant stated, "it is our position that Mr. Carnival's $100,000 liability settlement fully covered his claimed specials3 of $43,995.70 and over $55,000 for any subjective non-economic losses, which may already fully compensate him for his claimed losses." Id.
Plaintiff filed suit on October 26, 2015 in the District Court for Jefferson County, Colorado. Docket No. 1-7. Plaintiff alleges claims for breach of contract and unreasonable delay or denial in payment of insurance benefits under Colo. Rev. Stat. §§ 10-3-1115, 10-3-1116. Docket No. 5 at 4-5. Defendant removed the case to this Court on November 24, 2015. Docket No. 1.
Plaintiff seeks damages for "'past, present and future medical expenses, for past, present and future pain and suffering, for personal injuries, for emotional distress, and for other non-economic damages.'" Docket No. 26 at 4, ¶ 9. Plaintiff claims $49,470.90 in medical expenses resulting from the accident. Id., ¶ 10. Despite plaintiff's injuries, he has continued to work full time after the accident and does not claim any lost wages through this case. Id. at ¶ 8 ().
On March 29, 2016, defendant filed the pending motions. Defendant's motionsaddress the interaction between the workers' compensation insurance benefits received by plaintiff and the UIM coverage provided by defendant. The summary judgment motion requests the Court to enter "partial summary judgment on Plaintiffs tort-based UIM claim for the TPD and PPD benefits paid by the workers' compensation insurer, as well on as any aspect of Plaintiffs extra-contractual claim based upon those same TPD and PPD amounts." Docket No. 26 at 10. On March 15, 2017, defendant filed a notice stating that it "withdraws its request for exclusion of evidence at trial of Plaintiff's workers' compensation temporary partial disability (TPD) and permanent partial disability (PPD) payments." Docket No. 57 at 1, ¶ 1. Accordingly, defendant only requests "exclusion of evidence of Plaintiff's workers' compensation disability rating." Id., ¶ 2.
Workers' compensation in Colorado is governed by the Colorado Workers' Compensation Act, Colo. Rev. Stat. § 8-42-101, et seq. The Act "requires an evaluation of 'permanent medical impairment' to determine the amount of benefits to which a claimant is entitled." Gonzales v. Advanced Component Sys., 949 P.2d 569, 573 (Colo. 1997) (quoting Colo. Rev. Stat. § 8-42-107(1)). The physical impairment ratings used in determining compensation are "based on the revised third edition of the 'American Medical Association Guides to the Evaluation of Permanent Impairment', in effect as of July 1, 1991." Colo. Rev. Stat. § 8-42-107(8)(c). PPD benefits "are determined by multiplying the impairment rating by a statutory age factor and multiplying that by 400 weeks, at a certain percentage of the injured employee'saverage weekly wage." Boardman v. Hauck, No. 11-cv-01934-DME-BNB, 2012 WL 3545681, at *3 (D. Colo. Aug. 16, 2012) (citing Colo. Rev. Stat. §§ 8-42-107(d), 8-42-105). With exceptions not relevant here, a workers' compensation claimant's claims against the at-fault party are assigned and subrogated to the workers' compensation insurer up to the amount paid out for economic, physical impairment, and disfigurement damages. Colo. Rev. Stat. § 8-41-203.
Colorado has codified the common law rule precluding the admission of collateral source payments. Colo. Rev. Stat. § 10-1-135(10)(a) provides:
The fact or amount of any collateral source payment or benefits shall not be admitted as evidence in any action against an alleged third-party tortfeasor or in an action to recover benefits under section 10-4-609 [UM/UIM benefits].
Colorado courts have held that evidence of workers' compensation, Medicaid, PERA disability, and health insurance are inadmissible at trial. See Combined Commc'ns Corp. v. Pub. Serv. Co. of Colorado, 865 P.2d 893, 902 (Colo. App. 1993) (workers' compensation); Volunteers of Am. Colorado Branch v. Gardenswartz, 242 P.3d 1080, 1083 (Colo. 2010) (health insurance); Smith v. Kinningham, 328 P.3d 258, 262-63 (Colo. App. 2013) (Medicaid); Dep't of Human Servs. v. State Pers. Bd., 371 P.3d 748, 757 (Colo. App. 2016) (PERA disability). After a verdict is reached, the amount of damages is subject to setoff by certain collateral source payments. Combined Commc'ns Corp. v. Pub. Serv. Co. of Colorado, 865 P.2d 893 at 901 (citing Colo. Rev. Stat. § 13-12-111.6). Workers' compensation benefits, however, are not subject to setoff. Id. at 902.
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...
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