Northland Ins. Co. v. Bashor

• Decision Date: 20 March 1972
• Docket Number: No. C--67,C--67
• Citation: 494 P.2d 1292,177 Colo. 463
• Parties: NORTHLAND INSURANCE COMPANY, a Minnesota corporation, Petitioner, v. Thomas C. BASHOR, Respondent.
• Court: Colorado Supreme Court

Page 1292

494 P.2d 1292

177 Colo. 463

NORTHLAND INSURANCE COMPANY, a Minnesota corporation, Petitioner, v. Thomas C. BASHOR, Respondent.

No. C--67.

Supreme Court of Colorado, En Banc.

March 20, 1972.

Rehearing Denied April 10, 1972.

Sheldon, Bayer, McLean & Glasman, Chas. W. Sheldon, Jr., Denver, for petitioner.

Daniel S. Hoffman, Denver, for respondent.

DAY, Justice.

This case is on certiorari to the Colorado Court of Appeals. We granted the petition on the ground asserted by petitioner that the court had probably decided the issues in a manner not in accord with the decisions of the Colorado Supreme Court. It was asserted that, in arriving at its decision, the Court of Appeals had, in effect overruled the Colorado Supreme Court decision of Steen v. Aetna Casualty and Surety Co., 157 Colo. 99, 401 P.2d 254. (See Bashor v. Northland Insurance Co., 29 Colo.App. 81, 480 P.2d 864, selected for official publication.) We affirm the Court of Appeals.

Bashor had been in an automobile accident in which one Hilda Owens was injured. She sued Bashor and obtained a judgment of $18,000. Northland was the insurer of Bashor by a policy with a limit of $10,000. After the judgment, Northland paid Owens to the limit of the policy, leaving an $8,000 personal judgment against Bashor still unpaid. It was claimed in the suit involved herein against Northland that it negligently failed to settle the claim, as it could have, within the $10,000 coverage.

Prior to institution of the suit against Northland, the judgment creditor, Owens, undertook to obtain collection of the $8,000 judgment from Bashor and, among other things, levied on his home. Thereafter, Bashor and Owens entered into an agreement whereby Bashor paid Owens $1,500 in cash, agreed to bring suit to collect the $8,000 from the insurer for its failure to settle Owens' claim. The agreement provided that the attorney for Bashor was to be selected by Owens with the consent of Bashor. Additionally, if a full recovery resulted, Bashor would receive back his $1,500 and Owens would be paid the remainder. If recovery was for less than $8,000, the amount to Owens was to be prorated. Bashor agreed to fully prosecute the suit, including appeal if he was unsuccessful in the trial court; and in turn if Bashor fully completed the contract, Owens agreed to release all liens on Bashor's property; to refrain from further efforts to collect on the judgment from Bashor's property; and to place in escrow a 'satisfaction of judgment' to be delivered to Bashor either after Owens had received payment for any recovery in the lawsuit against Northland or after Bashor had exhausted all of the legal remedies agreed upon, even if recovery was not successful.

Bashor instituted the suit against Northland. Northland, apprised of the agreement between Bashor and Owens, filed a motion to limit the prayer for recovery to $1,500, on the ground that Bashor, by his agreement, had actually obtained a satisfaction of his personal judgment for that amount, and that, therefore, his claim for...