Case Title: United States v. Criterion Ins. Co.

Citation: 596 P.2d 1203

Docket Number: 

State: colorado

Court: Colorado Supreme Court

Date: 1979-07-02T00:00:00Z

Document:
596 P.2d 1203 (1979) In re Question Submitted by the United States Court of Appeals, Tenth Circuit, concerning the Colorado Automobile Accident Reparations Act (Sections 10-4-701 through 723, C.R.S. 1973) in its Number 77-1906 Entitled UNITED STATES of America, Plaintiff-Appellant, v. CRITERION INSURANCE CO., Defendant-Appellee. No. 28472. Supreme Court of Colorado, En Banc. July 2, 1979. *1204 Joseph F. Dolan, U. S. Atty., James W. Winchester, Asst. U. S. Atty., Denver, for plaintiff-appellant. Deisch & Marion, P.C., Sheldon H. Smith, Denver, for defendant-appellee. GROVES, Justice. This is the answer to a question certified to us under C.A.R. 21.1 by the United States Court of Appeals, Tenth Circuit, in its number 77-1906. The question is: Assuming arguendo that the Colorado Automobile Accident Reparations Act, sections 10-4-701 et seq., C.R.S. 1973 has application to the automobile accident involved, does that Act grant to the United States status as a third party beneficiary to the end that it may maintain the present action against Criterion Insurance Company? We answer in the affirmative. We requested, and the referring court agreed, that our answer would be predicated upon the following assumptions and conditions: that it be assumed without deciding that the law of the forum governs; that this court does not pass on any conflicts of law questions; that this court will not interpret Maryland law; and that there are no federal statutory provisions against recovery by the United States of America. In presenting the matter to this court, the certifying court made the following statement: We are concerned only with Criterion's alternative position mentioned in the last sentence above. Colorado's no-fault statute, the Colorado Auto Accident Reparations Act, is set forth in sections 10-4-701 through 723, C.R.S. 1973, which constitute Part 7 of an article relating to "Property and Casualty Insurance." Section 705 provides that "[e]very owner of a motor vehicle who operates the motor vehicle on the public highways of this state . . . shall have in full force and effect a complying policy under the terms of this part 7 covering the said motor vehicle" or shall be subject to certain sanctions. Section 706(1) provides that "the minimum coverages required for compliance" include: Section 711(4)(a) provides: For the purpose of this answer to the inquiry, it is assumed that Criterion is responsible for the statutorily required coverage above set forth. To repeat, the only question before us is whether the United States as a third party beneficiary can maintain an action to obtain reimbursement under this coverage. It is clear that our General Assembly in the adoption of the no-fault statute intended to place a duty upon the insurer to pay all the medical expense which the insured incurred by reason of the accident, irrespective of who might have been the tortfeasor.[1] We conclude that it was the legislative intent that the provider be a third party beneficiary in a situation such as this before us. Our attention has been called to only one case exactly in point in which the United States was found to be a third party beneficiary by reason of the provisions of a no-fault statute. Government Employees Insurance Company v. Rozmyslowicz, 449 F. Supp. 68 (E.D. N.Y. 1978). By analogy, our answer is supported by the following cases: Texas Emp. Ins. Assn. v. United States, 558 F.2d 766 (5th Cir. 1977); United *1206 States v. Bender Welding & Machine Co., 558 F.2d 761 (5th Cir. 1977); United States v. California State Automobile Association, 530 F.2d 850 (9th Cir. 1976); United States v. Automobile Club Insurance Company, 522 F.2d 1 (5th Cir. 1975); United States v. Government Employees Insurance Company, 461 F.2d 58 (4th Cir. 1972); United States v. State Farm Mutual Auto Insurance Co., 455 F.2d 789 (10th Cir. 1972); United States v. Leonard, 448 F. Supp. 99 (W.D. N.Y. 1978); United States v. Government Employees Insurance Company, 421 F. Supp. 1322 (N.D. N.Y. 1976); United States Automobile Association v. Holland, 283 So. 2d 381 (Fla. App. 1973); Marshall v. Rebert's Poultry Ranch, 268 N.C. 223, 150 S.E.2d 423 (1966); Stafford v. Pabco Products, Inc., 53 N.J.Super. 300, 147 A.2d 286 (1958). The General Assembly in section 706 quoted above mandated payment by the insurer of "all reasonable and necessary [medical] expenses." The only exception provides that coverage be reduced by the amount of benefits received under Workman's Compensation. When benefits were to be paid under Workman's Compensation, the coverage shall be reduced to the extent of those benefits. Section 707(5). Criterion contends that it should have no responsibility as there was an obligation on the part of the United States to furnish medical services to this serviceman. The fact remains that the United States incurred this expense as a result of an accident embraced within the policy provisions. As was stated in United Services Automobile Assn. v. Holland, 283 So. 2d 381 (Fla. Ct. App. 1973): Criterion has argued that under its insurance contract it should not be held liable. It points out that its policy provided: It further contends that under established law there is not a sufficient contractual basis here to create a third party beneficiary relationship. We do not accept the contentions. The provision specifically excluding the United States was abrogated by section 711(4)(a), C.R.S. 1973. See University of Denver v. Industrial Commission, 138 Colo. 505, 335 P.2d 292 (1959). Under our view of the legislative intent, the statute creates a third party beneficiary relationship. [1] The General Assembly was not unmindful of the providers of medical services when it provided in the statute that benefits "may be paid by the insurer directly to any persons supplying necessary products, services, or accommodations to the person for whom benefits are required. . . ." Section 708(2).