National Cas. Co. v. Great Southwest Fire Ins. Co.
| Decision Date | 20 July 1992 |
| Docket Number | No. 91SC562,91SC562 |
| Citation | 833 P.2d 741 |
| Parties | NATIONAL CASUALTY COMPANY, Petitioner, v. GREAT SOUTHWEST FIRE INSURANCE COMPANY and Hartford Accident and Indemnity Company, Respondents. |
| Court | Colorado Supreme Court |
Semple & Jackson, P.C., Franklin A. Nachman, Denver, for petitioner.
Walberg & Dagner, P.C., Wendelyn K. Walberg, Englewood, for respondent Great Southwest Fire Ins. Co.
Downey & Knickrehm, P.C., Kate E. Knickrehm, Gregg A. Greenstein, Denver, for respondent Hartford Acc. and Indem. Co.
We granted certiorari to review the decision in National Casualty Co. v. Great Southwest Fire Insurance Co., 821 P.2d 877 (Colo.App.1991). The court of appeals affirmed the summary judgment entered by the district court in favor of Great Southwest Fire Insurance Company (Great Southwest) and Hartford Accident and Indemnity Company (Hartford), concluding that they were not responsible for the defense and settlement of the underlying lawsuit against the City of Craig, Colorado. The court of appeals concluded that no claim was made while the policy was in effect 1 and that emotional distress did not constitute bodily injury within the meaning of a Hartford policy. We reverse in part, affirm in part, and remand with directions.
On August 27, 1984, the City of Craig notified Carol Jean Reutter, a police officer for the city, that her employment was being terminated. On September 12, 1984, Reutter wrote to the city administrator, stating that she had been "wrongfully terminated with no just cause" and requesting that she be "reinstated, with all charges dropped." Reutter was placed on suspension without pay pending resolution of the grievance. On or about September 26, 1984, the city denied Reutter's grievance and finalized her termination.
On March 21, 1985, Reutter filed a notice of claim with the city under the governmental immunity act, asserting that she had been injured as a result of her dismissal and seeking damages for her wrongful termination. § 24-10-109, 10A C.R.S. (1988). The city notified National Casualty Co. (National), Great Southwest, and Hartford of the letter.
On June 27, 1986, Reutter filed suit in the United States District Court for the District of Colorado against the city, the police department, the police chief, the city administrator, and the city council. She sought damages for violation of civil rights, wrongful discharge, breach of contract, willful and wanton conduct, retaliatory discharge, and outrageous conduct. The city moved for summary judgment on the ground that Reutter's notice of claim was untimely under § 24-10-109(1) () because it was sent more than 180 days after her termination on August 27, 1984. The district court denied summary judgment and held that the claim accrued on September 26, 1984, when the final decision was made to terminate Reutter, and that notice was timely filed.
The parties agreed to a settlement and National, on behalf of the city, paid Reutter $162,500, $35,000 being allocated to lost wages and the remainder as compensation for emotional distress, personal embarrassment, mental and physical strain, and injury to her health. National, as the insurance carrier for the city, both defended the city and paid the settlement. National then filed suit against Great Southwest and Hartford to recover a pro rata share of its defense costs and to obtain contribution or equitable subrogation of the amount paid to settle Reutter's claims.
The city was insured during different periods by Great Southwest, Hartford, and National, and the issue is whether Reutter made a claim that was covered by any policy other than National's. Great Southwest insured the city for wrongful acts under a claims made Public Officials Liability Policy for the period beginning June 10, 1984, and ending February 15, 1985. National insured the city under a similar policy, its Public Officials and Employees Legal Liability Policy, from February 14, 1985, through June 10, 1985. This policy contained a subrogation clause. Hartford insured the city against damages for bodily injury under a Comprehensive Business Policy issued for the period from June 10, 1982, to June 10, 1985. National provided similar coverage under its Comprehensive Law Enforcement Liability Policy, for the period February 15, 1985, through June 10, 1985. National's policy contains provisions both for other insurance and for subrogation.
National's complaint alleged that Reutter's claim against the city fell within the coverage provided by Great Southwest and Hartford, but that those companies had refused to defend the claims or to contribute to the settlement and defense costs. National sought declaratory judgment to determine the liability of Great Southwest and Hartford for breach of their duty to defend and to estop Great Southwest and Hartford from denying coverage. Alternatively, National contended that Great Southwest and Hartford's insurance policies provided coverage of the claims. National also asserted that Great Southwest and Hartford breached their contracts with the city by failing to defend the city in the Reutter litigation. National contended that it was subrogated to the rights of the city and had the right to assert claims against the policies issued by Great Southwest and Hartford because it paid the $162,500 in settlement of the Reutter litigation.
The trial court held that Reutter's request for grievance review did not constitute a claim or notice of claim within the meaning of the Great Southwest policy. Therefore, the court concluded, notice of the claim was not submitted within the period covered by the Great Southwest policy. The Great Southwest policy was a claims made policy for which "coverage exists only for claims made during the policy period," rather than an occurrence policy which covers occurrences during the life of the policy, and accordingly, Great Southwest had no obligation to defend or provide coverage for Reutter's claim. The trial court granted summary judgment for Great Southwest, determining that Great Southwest had no contractual obligation to provide contribution and, therefore, that National had no right of contribution against Great Southwest. The trial court granted summary judgment in favor of Hartford, finding that emotional distress did not constitute bodily injury within the terms of the policy. The court of appeals affirmed the trial court.
We must determine whether Reutter's claim against the city was made within Great Southwest's policy period and was covered under the terms of that policy. Whether emotional distress constitutes bodily injury within the meaning of the Hartford policy issued to Reutter is the second question. Based upon our answers to these two questions, we must address whether National had a right of contribution or subrogation against Great Southwest or Hartford for their failure to defend and pay the Reutter claims.
Great Southwest's Public Officials Liability Policy was issued for the period beginning June 10, 1984, and ending February 15, 1985, for claims made while the policy was in effect. The policy's insuring agreement states:
If, during the policy period, any claim or claims are first made against the INSUREDS as a result of any WRONGFUL ACT, the Company will pay ... all loss which the INSURED shall become legally obligated to pay as damages. The Company shall have the right and duty to defend any suit from such WRONGFUL ACT....
Section VI, the notice of claim provision in the policy provides:
If, during the policy period ... any INSUREDS shall receive written or oral notice from any party that it is the intention of such party to hold the INSUREDS responsible for a WRONGFUL ACT and the INSUREDS give written notice to the Company of the receipt of such written or oral notice within one year, then any claim which may subsequently be made against the INSUREDS arising out of such WRONGFUL ACT shall, for the purpose of this policy, be treated as a claim made during the POLICY YEAR in which such notice was given....
National contends that Reutter made a claim for wrongful termination on August 27, 1984, when she requested reinstatement. Southwest contends that Reutter's letter of August 27, 1984, requesting reinstatement did not constitute a claim because the termination was not finalized until September 26, 1984, and that the claim was not made until March 21, 1985, after the policy period. We disagree with Great Southwest.
The determination of whether a claim was made within the period of Southwest's coverage depends on the construction of the provisions in the insurance policy based on principles of contract interpretation. Cf. Hecla Mining Co. v. New Hampshire Ins. Co., 811 P.2d 1083, 1090 (Colo.1991) (). The insurance policy does not explicitly define the term "claim." Therefore, its interpretation depends on whether the policy provisions are ambiguous. See id. An unambiguous provision in an insurance policy must be given its plain and ordinary meaning. Wota v. Blue Cross & Blue Shield, 831 P.2d 1307, 1309 (Colo.1992); Terranova v. State Farm Mut. Ins. Co., 800 P.2d 58, 60 (Colo.1990).
The definition of a claim is an issue of first impression in Colorado. The majority of courts have interpreted a claim as a demand for something as a right. See, e.g., Phoenix Ins. Co. v. Sukut Constr. Co., Inc., 136 Cal.App.3d 673, 186 Cal.Rptr. 513 (1982); see also Katz Drug Co. v. Commercial Standard Ins. Co., 647 S.W.2d 831 (Mo.App.1983). In contrast, a mere request for information has been held not to constitute a claim. See, e.g., Winkler v. National Union Fire Ins. Co., 930 F.2d 1364 (9th Cir.1991); Hoyt v. St. Paul Fire & Marine Ins. Co., 607 F.2d 864 (9th Cir.1979); cf. Civic Assoc., Inc....
To continue reading
Request your trial
-
Trinity Universal Ins. Co. v. Cowan
...(1991, review denied); Employers Cas. Ins. v. Foust, 29 Cal.App.3d 382, 105 Cal.Rptr. 505, 508 (1972); National Cas. Co. v. Great Southwest Fire Ins. Co., 833 P.2d 741, 747 (Colo.1992); McGuire v. American States Ins. Co., 491 So.2d 606, 608 (Fla.Dist.Ct.App.1986); Cotton States Mut. Ins. C......
-
Daley v. Allstate Ins. Co.
...254 (Minn.1993); Chatton v. National Union Fire Ins. Co., 10 Cal.App.4th 846, 13 Cal.Rptr.2d 318 (1992); National Cas. Co. v. Great Southwest Fire Ins. Co., 833 P.2d 741 (Colo.1992); University of Ill. v. Continental Cas. Co., 234 Ill.App.3d 340, 599 N.E.2d 1338, 175 Ill.Dec. 324 (1992); Ai......
-
State v. McGraw
...So.2d 551 (Ala.1994); J.H. France Refractories Co. v. Allstate Ins. Co., 534 Pa. 29, 626 A.2d 502 (1993); National Cas. Co. v. Great Southwest Fire Ins. Co., 833 P.2d 741 (Colo.1992); Zurich–American Ins. Cos. v. Atlantic Mut. Ins. Cos., 139 A.D.2d 379, 531 N.Y.S.2d 911, 916 (1st Dep't 1988......
-
Hartford Cas. Ins. Co. v. Trinity Universal Ins. Co. of Kan.
...who breaches this duty can be found liable for the entire amount of the defense fees and costs”), with Nat'l Cas. Co. v. Great Southwest Fire Ins. Co ., 833 P.2d 741 (Colo.1992) (following the majority rule and holding that the plaintiff-insurer is “entitled to pro rata contribution from [i......
-
Chapter 9
...Indemnity Co., 163 Cal. App.4th 1387, 78 Cal. Rptr.3d 264 (2008). Colorado: National Casualty Co. v. Great Southwest Fire Insurance Co., 833 P.2d 741, 745 (Colo. 1992) (letter from terminated employee asserting wrongful termination and requesting reinstatement “was a demand made to enforce ......
-
Chapter 5
...& Surety Co., 45 Cal. App.4th 1, 52 Cal. Rptr.2d 690 (1996). Colorado: National Insurance Co. v. Great Southwest Fire Insurance Co., 833 P.2d 741 (Colo. 1992); Empire Casualty Co. v. St. Paul Fire & Marine Insurance Co., 764 P.2d 1191 (Colo. 1988); Dairyland Insurance Co. v. Drum, 568 P.2d ......
-
CHAPTER § 5.04 Insurance Coverage for Third-Party Losses
...Indem. Co. of R.I. v. Holloway, 17 F.3d 1 13, 1 15 (5th Cir. 1994) (itself citing Nat'l Cas. Co. v. Great Sw. Fire Insurance Co., 833 P.2d 741, 746 (Colo. 1992))). Eighth Circuit: Rolette Cty. v. W. Cas. & Surety Co., 452 F. Supp. 125, 130 (D.N.D. 1978) ("The use of the term 'bodily injury'......