Harrison v. Pinnacol Assur.
| Citation | 107 P.3d 969 |
| Decision Date | 11 March 2004 |
| Docket Number | No. 02CA1682.,02CA1682. |
| Parties | Gregory D. HARRISON, Plaintiff-Appellant, v. PINNACOL ASSURANCE, Defendant-Appellee. |
| Court | Court of Appeals of Colorado |
Wilcox & Ogden, P.C., Ralph Ogden, Denver, Colorado, for Plaintiff-Appellant.
Ruegsegger Thomas, L.L.C., Charles M. Pratt, Denver, Colorado, for Defendant-Appellee.
Opinion by Judge WEBB.
In this C.R.C.P. 57 action for a declaratory judgment against defendant, Pinnacol Assurance, the insurer in an underlying workers' compensation case, plaintiff, Gregory D. Harrison (claimant), appeals the judgment of dismissal. Claimant's action sought apportionment between economic and noneconomic damages of monies obtained in settlement of a separate tort action against the third party responsible for the industrial accident. We affirm.
The 1993 accident resulted in severe injuries to claimant, for which Pinnacol was obligated to pay workers' compensation benefits. Pinnacol approved the settlement, which was not apportioned between economic and noneconomic loss, although it was not joined as a party in the tort action. That action was then dismissed with prejudice.
Following the accident, Pinnacol began paying benefits. However, in 1994, and again in 1996, Pinnacol filed final admissions of liability (FALs) in the workers' compensation case. Both FALs said that Pinnacol was offsetting benefits under its subrogation right against the third party and it would resume paying benefits when the unpaid benefits equaled the net amount obtained by claimant from the settlement. Claimant objected to both FALs, but made no specific reference to Pinnacol's right of offset being limited to the economic damages portion of the settlement. No action was taken by either party on the objections and at that time the Workers' Compensation Act (Act) did not set a time limit within which a claimant had to request a hearing on an objection.
In 2001, claimant filed an application for hearing in the workers' compensation case, requesting that an administrative law judge (ALJ) apportion the settlement between economic and noneconomic damages. Pinnacol moved to dismiss the application for hearing, arguing that only the district court which heard the tort action had jurisdiction to apportion. Claimant opposed the motion and filed this action seeking district court apportionment.
The ALJ deferred ruling on the motion to dismiss, pending the outcome of this action. The workers' compensation case remains open. The record does not explain why claimant failed earlier to seek apportionment from either the ALJ or the district court.
Pinnacol then moved to dismiss this action, arguing as relevant here, that this action was barred by the two-year tort statute of limitations, § 13-80-102(1)(a), C.R.S.2003. The trial court granted the motion, finding that, as relevant here, because the cause of action accrued upon Pinnacol's filing of the 1994 FAL, the two-year tort statute of limitations barred the action.
We review the ruling on a motion to dismiss de novo, taking the material allegations of the complaint as admitted, and uphold the dismissal only if the plaintiff can prove no set of facts on which relief could be granted. Davidson v. Dill, 180 Colo. 123, 503 P.2d 157 (1972). Although generally the statute of limitations should be raised in the answer rather than in a motion to dismiss, "the defense of limitations may be raised by a motion to dismiss when the time alleged in the complaint shows that the action was not brought within the statutory period." Wasinger v. Reid, 705 P.2d 533, 534 (Colo.App.1985).
I.
Claimant contends that his action is timely because his objections to the FALs tolled any applicable statute of limitations, at least so long as the workers' compensation case remains open. According to claimant, unless the statute of limitations is tolled and apportionment is resolved in this independent action, he is left without a remedy to the extent that Pinnacol wrongly offsets benefits against the noneconomic damages portion of his settlement. Assuming, without deciding, that an independent declaratory judgment action is proper to apportion settlement, we nevertheless conclude the action is untimely.
Resolution of timeliness begins with characterizing the apportionment case as either an independent action or a proceeding ancillary to the workers' compensation case. Proper characterization is problematic because apportionment affects the workers' compensation benefits paid by Pinnacol, which may be offset only against economic damages. Martinez v. St. Joseph Hosp. & Nursing Home, 878 P.2d 13 (Colo.App.1993). However, the damages being apportioned here arise from settlement of the tort case.
Claimant argues that because the offset is based on an insurer's subrogation right under § 8-40-203(1)(b), C.R.S.2003, the Act governs the time frame and conditions under which the offset must be determined. See § 8-43-201, C.R.S.2003 (). We are not persuaded.
Initially, we note that, notwithstanding the broad jurisdictional grant of § 8-43-201, a division of this court discerned no basis on which either the Director of the Division of Labor or the Industrial Claim Appeals Office "could assert jurisdiction to determine how the proceeds paid by a third-party tortfeasor should be apportioned between economic and noneconomic losses suffered by a claimant." Jordan v. Fonken & Stevens, P.C., 914 P.2d 394, 395 (Colo.App.1995). Later cases have adhered to the view that jurisdiction to apportion settlement proceeds from a personal injury case lies in the district court. Jorgensen v. Colo. Comp. Ins. Auth., 967 P.2d 172 (Colo.App.1998), aff'd, 992 P.2d 1156 (Colo.2000) (Jorgensen II).
In apportioning a tort settlement, the district court does not determine either the amount of workers' compensation benefits to which the claimant is entitled or the extent of the insurer's offset. The court decides only that portion of the settlement which represents noneconomic damages. Jorgensen II, supra. Such a decision does not require any further action in a workers' compensation case. If an insurer improperly offsets benefits against settlement proceeds that a district court has apportioned to noneconomic damages, only then would the claimant's remedy be under the Act. Sections 8-43-201, 8-43-401(2)(a), C.R.S.2003.
Accordingly, we conclude this apportionment case is a separate cause of action, not an ancillary proceeding to the workers' compensation case, to which we must apply a statute of limitations and an accrual date.
The parties cite no Colorado case, and we have found none, determining which statute of limitations within Article 80 of Title 13 applies to a declaratory judgment action.
Further, the complaint does not plead any legal theory of recovery from which a limitation period could be applied. See Molleck v. City of Golden, 884 P.2d 725 (Colo.1994)
( declaratory judgment action disputing an election untimely based on a former version of the statute of limitations for election contests, Colo. Sess. Laws 1987, ch. 35, § 31-10-1303 at 332).
We discern no statute of limitations specifically applicable to declaratory judgment actions and therefore apply the two-year catch-all statute of limitations. See § 13-80-102(1)(i), C.R.S.2003 (). This statute has been applied to various claims for which no specific limitation period exists. See, e.g., Bd. of Trs. v. Koman, 133 Colo. 598, 298 P.2d 737 (1956)
(retirement benefits); Tafoya v. Perkins, 932 P.2d 836 (Colo.App.1996)(partnership accounting).
Other states have applied their catch-all statutes of limitations to declaratory judgment actions. See Maguire v. Hibernia Sav. & Loan Soc., 23 Cal.2d 719, 146 P.2d 673 (1944); Solnick v. Whalen, 49 N.Y.2d 224, 425...
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