Opinions of the Colorado Supreme Court are available to the 

public and can be accessed through the Judicial Branch’s homepage at 

http://www.courts.state.co.us. Opinions are also posted on the 

Colorado Bar Association’s homepage at http://www.cobar.org.

ADVANCE SHEET HEADNOTE

September 10, 2018

2018 CO 68

No. 17SC247, Munoz v. Am. Fam. Ins. Co.—Prejudgment Interest—Statutory 

Interpretation 

In this case, the supreme court considers whether an insured is entitled to collect 

prejudgment interest when he settles an uninsured motorist claim with his insurer. We 

hold that, under the plain language of the prejudgment interest statute, § 13-21-101,

C.R.S. (2017), an insured is entitled to prejudgment interest only after (1) an action is 

brought, (2) the plaintiff claims damages and interest in the complaint, (3) there is a 

finding of damages by a jury or court, and (4) judgment is entered. Because Munoz did 

not meet all of these conditions, this court concludes he is not entitled to prejudgment 

interest. 
The Supreme Court of the State of Colorado

2 East 14th Avenue • Denver, Colorado 80203

2018 CO 68

Supreme Court Case No. 17SC247

Certiorari to the Colorado Court of Appeals

Court of Appeals Case No. 16CA416

Petitioner:

Joel Munoz,

v.

Respondent:

American Family Mutual Insurance Company.

Judgment Affirmed

en banc

September 10, 2018

Attorneys for Petitioner:

Franklin D. Azar & Associates, PC

Patricia A. Meester

Keith R. Scranton

Aurora, Colorado

Levy Law, P.C.

Marc R. Levy

Englewood, Colorado

Attorneys for Respondent:

Campbell Latiolais & Averbach, LLC

Clifton J. Latiolais, Jr.

Denver, Colorado

Attorneys for Amici Curiae Colorado Civil Justice League and Colorado Defense 

Lawyers Association:
2

Taylor Anderson, LLP

Lee A. Mickus

Denver, Colorado

Attorneys for Amicus Curiae The Colorado Trial Lawyers Association:

The Gold Law Firm, LLC

Michael J. Rosenberg

Greenwood Village, Colorado

JUSTICE BOATRIGHT delivered the Opinion of the Court.
3

¶1 In this matter, we consider whether an insured is entitled to collect prejudgment 

interest when he settles an uninsured motorist claim (“UM claim”) with his insurer in 

lieu of filing a lawsuit and proceeding to judgment.

1 We hold that, under the plain 

language of the prejudgment interest statute, § 13-21-101, C.R.S (2017), an insured is 

entitled to prejudgment interest only after (1) an action is brought, (2) the plaintiff 

claims damages and interest in the complaint, (3) there is a finding of damages by a jury 

or court, and (4) judgment is entered. Because Munoz did not meet all of these 

conditions, he is not entitled to prejudgment interest. We therefore affirm the court of 

appeals. 

I. Facts and Procedural History

¶2 After Joel Munoz was injured in a car crash with an uninsured motorist, he filed

a UM claim with his insurer, American Family Insurance Company (“American 

Family”). During settlement negotiations, Munoz asked American Family to include 

prejudgment interest in its offer, but it declined to do so, stating that because 

prejudgment interest is required only after a judgment, it would not consider interest in 

settlement negotiations. 

 

1 Specifically, we granted certiorari to review the following issue:

1. Whether, pursuant to section 10-4-609(4), C.R.S. (2016), an insured is 

“legally entitled” to prejudgment interest under section 13-21-101(1), 

C.R.S. (2016), when the insured chooses to settle an uninsured motorist 

claim with his insurer in lieu of filing a lawsuit and proceeding to 

judgment.
4

¶3 American Family ultimately offered Munoz $10,008 to settle his claim, not 

including prejudgment interest. Munoz stated that he would accept the offer, but again 

asked American Family to add prejudgment interest, suggesting that he would 

otherwise sue. American Family did not consider that a true acceptance, and the parties 

were unable to resolve their dispute.

¶4 Munoz then sued. In his complaint, he alleged that American Family had 

breached its contract by refusing to pay all that he was entitled to under the uninsured

motorist policy, which he viewed as including prejudgment interest. Munoz also 

alleged that American Family did not have a reasonable basis to deny him this benefit

and that it had acted in bad faith by compelling him to litigate his claims to recover his 

full benefits. 

¶5 Munoz then filed a motion for determination of law, asking the court to decide 

whether an insurance company must pay prejudgment interest on money received from 

a settlement. Munoz argued that according to this court’s opinion in USAA v. Parker, 

200 P.3d 350 (Colo. 2009), American Family was required to pay prejudgment interest 

on its settlement offer. Parker stated that the uninsured motorist statute, § 10-4-609(4), 

C.R.S. (2017), requires that an insured be able to recover the same amount of damages 

from an insurance company as he would from a direct action against the tortfeasor. 200 

P.3d at 353. Because prejudgment interest is an element of damages, Munoz reasoned 

that he should be able to recover interest from the insurance company. 

¶6 The trial court disagreed. It concluded that American Family was not required to 

include prejudgment interest in any settlement offer because the claim did not result in 
5

a judgment through litigation. In so doing, the trial court distinguished Parker, finding 

that it did not address whether an insurer must pay prejudgment interest on a 

settlement, and ruling that requiring an insurer to do so would be contrary to the 

uninsured motorist statute and lead to “an inconsistent and bizarre result.”2 

¶7 Munoz then appealed the trial court’s determination of law. The court of appeals 

agreed with the trial court, holding that insurance companies are not required to pay 

prejudgment interest on a settlement. Munoz v. Am. Family Ins. Co., 2017 COA 25, ¶ 1, 

__ P.3d __. The division looked to the plain language of section 13-21-101 and 

concluded that a court’s authority to award prejudgment interest exists only “if a 

plaintiff has lawfully requested prejudgment interest, there is a jury verdict or court 

finding that the plaintiff has damages, and a judgment is entered.” Id. at ¶ 10. Because 

those prerequisites were not met here, the court of appeals concluded that Munoz was 

not entitled to prejudgment interest. See id. at ¶¶ 10–13. The division also agreed with 

the trial court’s interpretation of Parker, stating that while some language from that 

opinion could be construed to support Munoz’s position, the opinion read as a whole

does not imply that an insured may collect prejudgment interest without first filing an 

action and proceeding to judgment. Id. at ¶¶ 11–12. 

¶8 Munoz filed a petition for certiorari, which we granted. 

 

2 After the trial court’s ruling, the parties settled their remaining claims, understanding 

that the settlement did not resolve the dispute over prejudgment interest. 
6

II. Standard of Review

¶9 We review questions of law and statutory interpretations de novo. Goodman v. 

Heritage Builders, Inc., 2017 CO 13, ¶ 5, 390 P.3d 398, 401. In interpreting a statute, we 

attempt to discern the General Assembly’s intent first by looking to the text of the 

statute and giving words and phrases their plain and ordinary meaning. State Farm 

Mut. Auto. Ins. Co. v. Fisher, 2018 CO 39, ¶ 12, 418 P.3d 501, 504. Only if the language 

is ambiguous do we then resort to other interpretive rules of statutory construction; if 

the language is clear, we apply it as written. Id.

III. Analysis

¶10 In deciding whether Munoz is entitled to prejudgment interest, we first turn to 

the text of the applicable statute. We conclude that the plain language of section 

13-21-101 requires that certain conditions be met for a party to receive prejudgment 

interest, and because Munoz did not meet these conditions, he is not entitled to 

prejudgment interest.

¶11 Section 13-21-101 governs whether and when a party is entitled to collect 

prejudgment interest. It requires that the court add prejudgment interest to the 

damages claimed by the plaintiff and assessed by the fact-finder: 

In all actions brought to recover damages for personal 

injuries . . . it is lawful for the plaintiff in the complaint to 

claim interest on the damages claimed from the date the 

action accrued. When such interest is claimed, it is the duty 

of the court in entering judgment for the plaintiff in the

action to add to the amount of damages assessed by the 

verdict of the jury, or found by the court, interest on such 

amount . . . .
7

§ 13-21-101(1) (emphases added). As the court of appeals noted, there are several 

clauses in the statute indicating that prejudgment interest applies only after a judgment. 

The following conditions must be met: (1) an action must be brought, (2) the plaintiff 

must claim damages and interest in the complaint, (3) there must be a finding of 

damages by a jury or the court, and (4) judgment must be entered. See Munoz, ¶ 10. 

The statute is not ambiguous. It requires that all four conditions be satisfied for

prejudgment interest to be awarded.

¶12 A pre-claim settlement does not satisfy any of these four conditions. When 

parties reach a settlement prior to litigation, no action is brought, no damages or 

interest are claimed in a complaint, no finding of damages is made by a jury or court, 

and no judgment is entered. Such was the case here when American Family offered the 

settlement; none of the conditions had been met, and so American Family was not 

required to include prejudgment interest. And while Munoz has now filed an action 

and demanded damages and interest in his complaint—thereby technically meeting the 

first two requirements—he did so to determine whether he was entitled to prejudgment 

interest on the settlement offered rather than to obtain a judgment on his underlying 

claim. Thus, he has not met the required conditions to be entitled to prejudgment 

interest. 

¶13 This reading of the statute is consistent with what we have previously held to be 

its purpose: “[T]o compensate the plaintiff for the time value of the amount of his or her 

judgment.” Morris v. Goodwin, 185 P.3d 777, 780 (Colo. 2008); see also Seaward Constr. 

Co. v. Bradley, 817 P.2d 971, 975 (Colo. 1991) (“The interest is compensatory and is 
8

awarded to indemnify the plaintiff for the loss of earnings on that money due to its 

delayed payment.” (quoting Coale v. Dow Chem. Co., 701 P.2d 885, 890 (Colo. App. 

1985))). When deciding whether to pursue a settlement or proceed to trial, parties must 

weigh the benefit of an earlier resolution and the risk of going to trial. Judgments as a 

result of a trial can take a long time to obtain, so the General Assembly has decided to 

compensate a party for that waiting period. Though there is also some waiting period 

before resolution by settlement, if the General Assembly had wanted to award interest 

for that time period, it would have written the statute to reflect that outcome. It did not.

¶14 While Munoz attempts to argue otherwise, we find those arguments 

unconvincing. Munoz first points to two cases—Morris and Seaward—where we held 

that section 13-21-101 was ambiguous, urging us to do the same here. In those cases, 

however, we interpreted section 13-21-101 in materially different contexts.

¶15 In Morris, we held that the statute was ambiguous as to how to calculate

prejudgment interest, not as to when a party was entitled to prejudgment interest. 185 

P.3d at 779–80. In Seaward, we considered whether the court should award 

prejudgment interest on punitive damages. 817 P.2d at 975. We found that because the 

statute did not expressly say whether prejudgment interest applies to punitive 

damages, and because language in the statute could be construed either way, the statute 

was ambiguous on that point. See id. at 974 (highlighting that the language “personal 

injuries sustained” and “damages claimed” suggests interest is available for only 

compensatory damages, but that the language “damages assessed by the verdict of the 

jury” suggests interest is available for punitive damages as well (emphases added)). 
9

But because both punitive damages and compensatory damages presuppose litigation 

and judgment, the ambiguity identified in Seaward is irrelevant to our interpretation 

here.

¶16 Munoz also relies on Parker, where we considered which statute a court should 

calculate prejudgment interest under when an insured succeeds in a UM claim against 

his insurer. 200 P.3d at 353. In that case, Parker was injured in an accident by a 

motorist who could not completely cover his damages. Id. at 354. He filed a UM claim 

with his insurance company and ultimately received a judgment against the company

at trial. Id. A dispute then arose as to whether the insurance company owed Parker 

prejudgment interest under the personal injury statute, calculated at nine percent per 

annum, see § 13-21-101(1), or the wrongful withholding statute, calculated at eight 

percent per annum, see § 5-12-102(1)(b), C.R.S. (2017). Parker, 200 P.3d at 354–56. 

¶17 In answering this question, we stated that the uninsured motorist statute entitles 

an insured to recover all the damages that he could recover in an action directly against 

the tortfeasor, and that prejudgment interest is a form of damages. Id. at 358. We 

concluded, therefore, that an insured may recover prejudgment interest against an 

insurer. See id. Following this reasoning, we held that because prejudgment interest in 

a direct action against a tortfeasor is calculated under the personal injury statute at nine 

percent per annum, so too must prejudgment interest be calculated in a case against an 

insurer. Id. at 359. Otherwise, an insured would recover less in a case against an 

insurer than in one directly against the tortfeasor, in violation of the uninsured motorist 

statute. See § 10-4-609(4).
10

¶18 Munoz extrapolates the holding and language in Parker to mean that he is 

entitled to prejudgment interest against his insurer in this case. But Parker did not hold 

that an insured is entitled to collect prejudgment interest when he settles a claim with 

his insurer. Instead, it pertained to collecting prejudgment interest from an insurer only 

after obtaining a judgment against said insurer. See Parker, 200 P.3d at 354 (explaining 

that the case against the insurer was tried to a jury, and after a mistrial and stipulation 

to a court decision, the trial court awarded the insured a judgment including damages). 

Munoz also argues that without prejudgment interest he would recover less against his 

insurer than in a direct action against the tortfeasor (just like the plaintiff in Parker). 

But again, Munoz is comparing a judgment to a settlement. Thus, the outcomes could 

be different regardless of whether they were against a tortfeasor or an insurer. Under 

the proper comparison, Munoz is actually in the exact same position as a plaintiff who 

sues a tortfeasor. Neither receives prejudgment interest if they settle, and both may 

receive prejudgment interest if a jury or court awards a judgment in their favor. 

¶19 Hence, an insured is not entitled to collect prejudgment interest against an 

insurer on a settlement.

IV. Conclusion

¶20 The text of section 13-21-101 is unambiguous, and we are unpersuaded by 

Munoz’s arguments in the alternative. As a result, we hold that under the plain 

language of section 13-21-101, an insured is entitled to prejudgment interest only after 

(1) an action is brought, (2) the plaintiff claims damages and interest in the complaint,

(3) there is a finding of damages by a jury or the court, and (4) judgment is entered. 
11

Because Munoz did not meet all of these conditions, he is not entitled to prejudgment 

interest. We therefore affirm the court of appeals.