Jackson v. Am. Family Mut. Ins. Co.

• Decision Date: 12 May 2011
• Docket Number: No. 10CA0369.,10CA0369.
• Citation: 258 P.3d 328
• Parties: Rebecca JACKSON, Plaintiff–Appellant,v.AMERICAN FAMILY MUTUAL INSURANCE COMPANY, Defendant–Appellee.
• Court: Colorado Court of Appeals

258 P.3d 328

Rebecca JACKSON, Plaintiff–Appellant,

v.AMERICAN FAMILY MUTUAL INSURANCE COMPANY, Defendant–Appellee.

No. 10CA0369.

Colorado Court of Appeals, Div. IV.

May 12, 2011.

Franklin D. Azar & Associates, P.C., Franklin D. Azar, Richard P. Barkley, Aurora, CO, for Plaintiff–Appellant.Harris, Karstaedt, Jamison & Powers, P.C., A. Peter Gregory, Englewood, CO, for Defendant–Appellee.

Opinion by Judge DAILEY.

Plaintiff, Rebecca Jackson, appeals the trial court's judgment notwithstanding the verdict (JNOV) in favor of defendant, American Family Mutual Insurance Company (American Family), on her breach of contract claim. We affirm.

I. Background

In March 2002, Jackson was seriously injured in a car accident. At the time, she was insured under an American Family automobile policy which provided basic personal injury protection (PIP) benefits. The policy did not, however, provide (as was then required by law) an option to purchase extended PIP coverage. See Colorado Auto Accident Reparations Act (CAARA), Ch. 94, sec. 1, §§ 13–25–1 to –23, 1973 Colo. Sess. Laws 334–45 (formerly codified as amended at §§ 10–4–701 to –726; repealed effective July 1, 2003, Ch. 189, sec. 1, § 10–4–726, 2002 Colo. Sess. Laws 649).

Before this case was filed, many other policyholders filed cases against American Family based on this omission. Three are pertinent here:

• French v. American Family Mutual Insurance Co., (El Paso County Dist. Ct. No. 00CV3162), was filed in November 2000, and class certification was denied in December 2002.

• Marshall v. American Family Mutual Insurance Co., (Adams County Dist. Ct. No. 03CV1081), was filed in April 2003, and class certification was denied in November 2003.

• Hicks v. American Family Mutual Insurance Co., (Boulder County Dist. Ct. No. 04CV879), was filed in June 2004 and sought reformation of insurance policies on behalf of a class that included Jackson. On November 2, 2005, the trial court certified the class, recognized that American Family's policies did not include the necessary PIP coverage, and held that the policies must be reformed to include such coverage.

Jackson filed the present action in April 2008 against the claims analyst employed by American Family and added American Family itself as a party in October 2008. In her amended complaint, she alleged damage claims for breach of contract, willful and wanton statutory bad faith, breach of the implied covenant of good faith and fair dealing, and fraudulent and negligent concealment and misrepresentation, all stemming from American Family's failure to offer or provide optional PIP coverage.

After a trial, a jury returned verdicts awarding Jackson $61,300 on her breach of contract claim and $300,000 on some of her tort claims. American Family moved for a JNOV on the ground that Jackson's claims were barred by the statute of limitations. The trial court ultimately granted the motion on only Jackson's breach of contract claim.

Jackson appeals only the JNOV entered on her contract claim. She contends that (1) American Family was barred, under the doctrine of claim preclusion, from relitigating a statute of limitations issue which was or could have been resolved in Hicks; and (2) the trial court, in any event, erred in its application of the statute of limitations.¹

We address—and reject—each of these contentions in turn.

II. Claim Preclusion

We review claim preclusion issues de novo where, as here, the pertinent facts are undisputed and the matter can be determined by a review of either the prior judgment or the record. Camp Bird Colorado, Inc. v. Board of County Commissioners, 215 P.3d 1277, 1281 (Colo.App.2009).

“Claim preclusion works to preclude the relitigation of matters that have already been decided as well as matters that could have been raised in a prior proceeding but were not.” Argus Real Estate, Inc. v. E–470 Public Highway Auth., 109 P.3d 604, 608 (Colo.2005). For a claim in a second judicial proceeding to be precluded by a previous judgment, there must exist (1) finality of the first judgment; (2) identity of subject matter; (3) identity of claims for relief; and (4) identity or privity between parties to the actions. Id.; see also McLane Western, Inc. v. Dep't of Revenue, 199 P.3d 752, 756 (Colo.App.2008).

Here, the parties dispute only the applicability of the third element, that is, the identity of claims for relief. In this regard, Jackson correctly points out that

[i]n analyzing whether there is an identity of claims for relief, we do not focus our inquiry on the specific claim asserted or the name given to the claim. Instead, the “same claim or cause of action requirement is bounded by the injury for which relief is demanded, and not by the legal theory on which the person asserting the claim relies.”

Holnam, Inc. v. Industrial Claim Appeals Office, 159 P.3d 795, 798 (Colo.App.2006) (quoting in part Farmers High Line Canal & Reservoir Co. v. City of Golden, 975 P.2d 189, 199 (Colo.1999)).

In her opening brief, Jackson argues that the underlying injury for which relief was demanded in both Hicks and here is the same: the denial of her legal right to an option to purchase extended PIP benefits.

Hicks was a class action in which the only relief requested—and given—was reformation of policies and notice thereof; indeed, the class had been narrowly certified to effect just that result.² In rendering its ruling, the court noted that “questions concerning the amount or type of benefits owed any individual class member under any reformed policies fall outside the scope of the class action.” ³

Because the Hicks court excluded from its judgment any consideration of damage claims (or defenses thereto), Jackson's damages claim was not a matter which either was or could have been adjudicated in Hicks. Consequently, the judgment rendered in Hicks could not, under the doctrine of claim preclusion, bar either Jackson's action or American Family's assertion of a statute of limitations defense thereto. See Hernandez v. Woodard, 873 P.2d 20, 21 (Colo.App.1993) (discussing claim preclusion under its former name, “res judicata,” and holding that res judicata is not applicable “if the plaintiff was unable to seek a certain remedy or form of relief in the first action because of certain legal restraints”); In re Marriage of Wright, 841 P.2d 358, 360 (Colo.App.1992) (discussing claim preclusion under its former name, “res judicata,” and holding that “res judicata does not apply when the initial forum lacked the authority to award the full measure of relief sought in the subsequent litigation”).

III. Statute of Limitations

The applicable statute of limitations required commencement of suit “within three years after the cause of action accrues, and not thereafter.” § 13–80–101(1)(j), C.R.S.2010; see also Murry v. GuideOne Specialty Mut. Ins. Co., 194 P.3d 489, 492 (Colo.App.2008) (claims arising under CAARA are subject to the three-year limitations period in section 13–80–101(1)(j)).⁴

Ordinarily, when a claim accrues and, consequently, whether a claim is barred by the statute of limitations are questions of fact for a jury to resolve. See J.A. Balistreri Greenhouses v. Roper Corp., 767 P.2d 736, 739 (Colo.App.1988); Norton v. Leadville Corp., 43 Colo.App. 527, 530, 610 P.2d 1348, 1350 (1979). However, when the material facts are undisputed and reasonable persons could not disagree about their import, these questions may be decided as a matter of law. See Liscio v. Pinson, 83 P.3d 1149, 1153 (Colo.App.2003); Winkler v. Rocky Mountain Conference of United Methodist Church, 923 P.2d 152, 158–59 (Colo.App.1995); see also Nelson v. State Farm Mutual Automobile Ins. Co., 419 F.3d 1117, 1119 (10th Cir.2005) (“Whether a court properly applied a statute of limitations and the date a statute of limitations accrues under undisputed facts are questions of law we review de novo.”).

In applying the statute of limitations, the trial court identified two possible accrual dates under Colorado law for Jackson's contract claim, namely, when she was informed by American Family of the limits of her PIP benefits (March 28, 2002), and when she retained counsel to represent her in connection with her PIP claim (May 9, 2003). Thus, the court concluded, Jackson's claim accrued, “at the latest,” on May 9, 2003 and the statute of limitations period expired no later than May 9, 2006.

In reaching its ultimate conclusion, the court rejected Jackson's assertion that the limitations period had been tolled by certain events and, as a consequence, had not expired by the time she filed her lawsuit in April 2008.

On appeal, Jackson argues that

(1) she could not have asserted a breach of contract claim—and, thus, her claim could not have accrued—until her policy was reformed by the Hicks court in November 2005; and

(2) even if her claim could have accrued earlier, the limitations period was tolled by certain events long enough to allow for the 2008 filing of her complaint.

A. Accrual Date

An action for breach of contract “shall be considered to accrue on the date the breach is discovered or should have been discovered by the exercise of reasonable diligence.” § 13–80–108(6), C.R.S.2010. Similarly, “[a] cause of action for losses or damages not otherwise enumerated in this article shall be deemed to accrue when the injury, loss, damage, or conduct giving rise to the cause of action is discovered or should have been discovered by the exercise of reasonable diligence.” § 13–80–108(8), C.R.S.2010.

“Thus, whether the action was one for reformation, breach of contract, or violation of state law, the accrual date is when [the plaintiff] knew or should have known that [the defendant] had not offered him [or her] extended PIP benefits.” Nelson, 419 F.3d at 1121; accord Crosby v. Am. Family Mut. Ins. Co., 251 P.3d 1279, 1285 (Colo.App.2010); Murry, 194 P.3d at 492.

A division of this court in Crosby rejected the very argument Jackson makes here, that is, that her...