Evinger v. Greeley Gas Co., 94CA0988

• Decision Date: 15 June 1995
• Docket Number: No. 94CA0988,94CA0988
• Citation: 902 P.2d 941
• Parties: Carrie E. EVINGER, Plaintiff-Appellee, v. GREELEY GAS COMPANY, a Delaware corporation, Defendant-Appellant. . I
• Court: Colorado Court of Appeals

Page 941

902 P.2d 941

Carrie E. EVINGER, Plaintiff-Appellee, v. GREELEY GAS COMPANY, a Delaware corporation, Defendant-Appellant.

No. 94CA0988.

Colorado Court of Appeals,

Div. I.

June 15, 1995.

Rehearing Denied July 13, 1995.

Keith Killian & Associates, P.C., J. Keith Killian, James P. Guthro, Grand Junction, for plaintiff-appellee.

Kennedy & Christopher, P.C., John R. Mann, Denver, for defendant-appellant.

Opinion by Chief Judge STERNBERG.

The defendant, Greeley Gas Company (GGC), appeals the judgment entered on a jury verdict in favor of the plaintiff, Carrie E. Evinger. We reverse.

Evinger was injured in an automobile accident which occurred when a truck owned by GGC struck the rear of her automobile, which was stopped at an intersection. At the time of the accident, GGC's truck was being operated by its employee within the course and scope of his employment.

Evinger had not obtained personal injury protection (PIP) coverage as required by the Colorado Automobile Accident Reparations Act (No Fault Act), and GGC's vehicle was a "nonprivate passenger vehicle." See § 10-4-713(2)(a), C.R.S. (1994 Repl.Vol. 4A).

Evinger sued GGC for damages for the injuries she sustained in the accident. The parties stipulated that the GGC employee would not be personally liable for any damages awarded Evinger; thus, he is not a party to this appeal.

Included among the damages sought were the cost of medical services. Being unable to pay these medical bills, Evinger delivered a promissory note for the amount of each debt to each of the providers of medical services four days before trial. The notes stated that the "principal shall be due and payable on August 15, 1994" and that no interest would accrue unless and until payment was not made by the due date.

The case was tried to a jury, which returned a verdict awarding Evinger $80,000 in damages, but also found her to be 25% at fault. In response to a specific interrogatory, the jury determined that $25,380 of the verdict was for reasonable and necessary medical expenses.

GGC moved for a judgment notwithstanding the verdict, asking the court to offset $50,000 for unpaid PIP benefits from the amount of the jury verdict. The court denied the motion and entered judgment on the verdict in the amount of $60,000. The court later amended the judgment to add $16,509.16 in prejudgment interest, $6,325.30 in costs, and $1,479.97 in actual costs pursuant to § 13-17-202, C.R.S. (1987 Repl.Vol. 6A). This appeal followed.

I.

The No Fault Act makes it compulsory for every owner of a motor vehicle that is operated on the public highways to obtain a complying policy that includes PIP coverage. See § 10-4-701, et seq., C.R.S. (1994 Repl.Vol. 4A). An owner who operates a motor vehicle on the public highways without having a complying policy faces the following consequences: (a) loss of license under the financial responsibility law, § 42-7-101, et seq., C.R.S. (1993 Repl.Vol. 17); (b) personal liability for the no fault benefits to all persons, including the uninsured driver, who would have had such benefits had the owner been insured, § 10-4-705(1), C.R.S. (1994 Repl.Vol. 4A); (c) loss of all tort immunity, § 10-4-705(1)(b), C.R.S. (1994 Repl.Vol. 4A); (d) ineligibility for no fault benefits if injured; (e) preclusion from filing suits against others until a "threshold" is reached, § 10-4-704, C.R.S. (1994 Repl.Vol. 4A); and (f) liability to being charged with a Class One motor vehicle offense, § 10-4-705, C.R.S. (1994 Repl.Vol. 4A).

Prior to 1979, an uninsured owner motorist was treated as a constructive self-insurer and, as such, if he paid no fault benefits to others or for himself, he had a right of reimbursement of such amounts actually paid against the person at fault. However, by amendment enacted that year, this right of reimbursement was eliminated except in certain limited situations. See Colo.Sess.Laws 1979, ch. 75, § 10-4-713 at 389.

Section 10-4-713(2)(a), C.R.S. (1994 Repl.Vol. 4A), however, creates an exception to this rule if the other vehicle involved in the accident is a "nonprivate passenger vehicle." But, this "nonprivate passenger vehicle" exception itself contains an exception which allows a plaintiff that is an uninsured owner to recover only those PIP expenses that were "actually paid."

II.

It is undisputed here that: (a) Evinger did not have PIP coverage; (b) the other vehicle involved in the accident was a "nonprivate passenger vehicle"; and (c), at the time of the trial, Evinger had met her obligation for her medical bills by delivery of promissory notes. Accordingly, in light of the exception to the exception language of the statute, the dispositive issue here becomes whether delivery of promissory notes by Evinger to her health care providers constitutes "actual payment," as that term is used in § 10-4-713(2)(a). The trial court ruled that, by delivery of these notes, Evinger had "actually paid" these expenses. We conclude the trial court erred in so ruling.

The parties do not dispute that: (1) because Evinger's vehicle was not insured at the time of the accident, she became personally liable as a constructive self-insurer, pursuant to § 10-4-705(2), C.R.S. (1994 Repl.Vol. 4A), for payment of the PIP benefits provided for in §§ 10-4-706(1)(b) to 10-4-706(1)(e), C.R.S. (1994 Repl.Vol. 4A); and (2) under § 10-4-713(1), C.R.S. (1994 Repl.Vol. 4A), Evinger ordinarily would have been precluded from suing GGC to recover her PIP benefits.

Evinger claims, however, that she is entitled to recover PIP benefits from GGC because of the provisions § 10-4-713(2)(a) which state:

[W]here a motor vehicle accident involves a private passenger motor vehicle and a nonprivate passenger motor vehicle, the insurer of the private passenger motor vehicle shall have a direct cause of action for all benefits actually paid by such insurer ... against the owner, user, or operator of the nonprivate passenger motor vehicle or against any ... organization legally responsible for the acts or omissions of such owner, user or operator. (emphasis supplied)

Applying this statute, a division of this court held that an uninsured motorist's cause of action against the tortfeasor's insurer for reimbursement of medical expenses paid by the uninsured motorist to his passenger does not accrue until the benefits are actually paid. Sakala v. Safeco Insurance Co., 833 P.2d 879 (Colo.App.1992). The Sakala ruling, however, does not resolve the issue before us because there the meaning of the statutory phrase "actually paid" was not a matter in contention.

The interpretation of a statute is a question of law. Dunlap v. Colorado Springs Cablevision, Inc., 855 P.2d 6 (Colo.App.1992). Hence, we need not defer to the trial court's interpretation that delivery of the promissory notes constituted actual payment; instead, we may review the question de novo. Evans v. Romer, 854 P.2d 1270 (Colo.1993).

In construing statutes, our primary task is to ascertain and give effect to the intent of the General Assembly by first looking to the language of the statute itself. Colorado State Board of Medical Examiners v. Saddoris, 825 P.2d 39 (Colo.1992). The words used should be given effect according to their plain and ordinary meaning. Farmers Group, Inc. v. Williams, 805 P.2d 419 (Colo.1991).

In 1979, the General Assembly amended the statute governing the PIP benefits recoverable in a direct action against the tortfeasor, as follows:

[T]he insurer of the private passenger motor vehicle shall have a direct cause of action for all benefits ACTUALLY paid by such insurer. (capitalization indicates word added)

That wording, though now expanded, remains in § 10-4-713(2)(a).

The legislative history of the amendment contains no discussion of the reason the word "actually" was inserted; however, we presume that, by adding the term "actually" to the phrase "benefits paid by such insurer," the General Assembly intended to change the meaning of the phrase. See City of Florence v. Board of Waterworks, 793 P.2d 148 (Colo.1990) (in interpreting a statute, each word should be given effect). In our view, addition of the term "actually" narrows significantly the means of payment acceptable under the statute.

The plain and ordinary meaning of the words in question supports our interpretation. "Actual" means something real, substantial, or existing presently in fact as opposed to that which is potential, possible, or hypothetical. Black's Law Dictionary 34 (rev. 6th ed. 1990). "Payment" means the discharge of an obligation or debt. Black's Law Dictionary 1128 (rev. 6th ed. 1990). Thus, in our view, the plain meaning of "actually paid" connotes that discharge of the debt is required before an injured uninsured motorist may recover for PIP benefits by means of a direct action against the tortfeasor pursuant to § 10-4-713(2)(a).

Under both common law, see Globe Express Co. v. Taylor, 61 Colo. 430, 158 P. 717 (1916), and the Uniform Commercial Code, see § 4-3-802(1), C.R.S. (1992 Repl.Vol. 2) (Official Comment 3), the tender of a promissory note represents only "conditional payment." And, such delivery will be deemed as discharging the underlying debt only if the parties thereto so intend. Berardini v. Hart, 682 P.2d 519 (Colo.App.1984); J. White & R. Summers, Uniform Commercial Code § 13-20 at 541 (1980).

Here, the promissory notes on their face evince no intent by the parties to discharge Evinger's underlying obligation for medical services. Moreover, neither Evinger nor any of her medical providers testified that the notes were given or accepted with the intent of discharging her existing obligations. In fact, Evinger conceded on cross-examination that she gave the notes only because of the pending litigation.

Furthermore, when Evinger executed the promissory notes, she had no funds or assets with which to satisfy them. Consequently, her ability to discharge the notes on August 15, 1994, was wholly contingent upon her...