Court Opinion

ID: 9855148
Source: CourtListenerOpinion
Date Created: 2023-09-24 06:20:18.504309+00
Date Added: 2024-06-11T09:23:42.233961
License: Public Domain

Justice ERICKSON
specially concurring:
I specially concur. We granted certiorari pursuant to C.A.R. 50, and consolidated Passamano v. Travelers Indemnity Co., 835 P.2d. 514 (Colo.App.1991), with Kent v. Budget Rent-A-Car Systems, Inc., for review.
The cases center on a determination of whether uninsured or under-insured motorist coverage had to be offered by a rental car agency to customers at the time that automobiles were rented. Principles of contract, bailments, and insurance law are involved, but the primary issues relate to uninsured and under-insured motorist statutes enacted by the General Assembly.
I
A
The facts in Passamano are that Passamano rented an automobile in Vail, Colorado, from ’ North-West Leasing Corporation (North-West), a licensee of National Car Rental Systems (National). North-West was a party to a liability insurance policy issued by Travelers Indemnity Company (Travelers) that covered North-West’s vehicles. North-West rejected uninsured motorist coverage when it purchased the policy from Travelers.
While driving the car near Leadville, Colorado, Passamano was involved in a collision caused by the negligence of an uninsured motorist. Passamano sustained serious injuries and filed suit against respondents Travelers, North-West, and National. In his amended complaint, Passamano alleged that *1324the rental agreement, which contained provisions pertaining to liability insurance, was in fact a contract of insurance. In claiming that the respondents were the insurers and that he was the insured, Passamano asserted that respondents violated section 10-4-609(1), 4A C.R.S. (1987), by failing to offer him uninsured motorist coverage.
In their motion for summary judgment, respondents argued that because NorthWest was the named insured under the insurance contract executed by North-West and Travelers, only North-West had authority under section 10-4-609(1) to reject uninsured motorist coverage. Respondents also alleged that the agreement between NorthWest and Passamano was not an insurance contract, and that Colorado does not require rental car agencies to offer uninsured motorist coverage to their customers.
The trial court held that the agreement between Passamano and North-West was a bailment contract, not an insurance contract. Under the insurance policy issued to NorthWest by Travelers, the trial court determined that North-West was the named insured and Passamano the additional insured. Passamano thus had no authority to acquire or reject uninsured motorist coverage.
In affirming the trial court, the court of appeals held that a rental agreement for the lease of a vehicle from a car rental agency creates a bailment contract, not a contract of insurance, and that North-West was the named insured for purposes of section 10-4-609(1).
B
In Kent, Kent rented an automobile from Budget Ren1>-A-Car Systems, Inc. (Budget), in Denver. Budget was self-insured, and neither offered nor provided uninsured motorist coverage to Kent.
While driving the vehicle, Kent was forced off the road by the negligent conduct of an uninsured motorist. Kent and Brown, a passenger in the car, sustained severe injuries. They filed a civil action against Budget for damages and costs, and sought a declaratory judgment to reform the rental agreement to include uninsured motorist coverage.
Budget filed a motion for summary judgment, claiming that as a self-insurer it was not required to offer uninsured motorist coverage to Kent. The trial court granted Budget’s motion.
II
A
The intent of the General Assembly in enacting section 10-4-609(1), which provides motorists with the right to uninsured 'motorist coverage if not specifically rejected, was to allow motorists to protect themselves against losses caused by the conduct of negligent and financially irresponsible motorists. Kral v. American Hardware Mut. Ins. Co., 784 P.2d 759, 765 (Colo.1989). As a result, section 10-4-609(1) requires that uninsured motorist coverage be offered in any motor vehicle policy, “except that the named insured may reject such coverage in writing.” The purpose of the statute is to permit the insured to make an informed choice whether to purchase uninsured motorist coverage. Allstate Ins. Co. v. Parfrey, 830 P.2d 905 (Colo.1992).
The General Assembly, in passing the Colorado Uninsured Motorist Act, declared:
The General Assembly is acutely aware of the toll in human suffering and loss of life, limb and property caused by negligence in the operation of motor vehicles in our state. Although it recognizes that this basic problem can and is being dealt with by direct measures designed to protect our people of this state from the ravages of irresponsible drivers, the General Assembly is also very much concerned with the financial loss visited upon innocent traffic accident victims by negligent motorists who are financially irresponsible. In prescribing the sanctions and requirements of § 10-4-319 and Article 7 of Title 42, C.R.S. 1973, it is a policy of this state to induce and encourage all motorists to provide for their financial responsibility for the protection of others and to assure the widespread availability to the insuring public of insurance protection against financial loss caused by negligent financially irresponsible motorists.
*1325§ 10-4-320, 4 C.R.S. (1973) (emphasis added). This statute expresses that “the legislature’s prime concern is the need to compensate the innocent driver for injuries received at the hands of one from whom damages cannot be recovered.” Farmers Ins. Exchange v. McDermott, 34 Colo.App. 305, 308-09, 527 P.2d 918, 920 (1974).
Insurance laws are to be liberally construed in order to further their remedial and beneficial purposes. Travelers Indem. Co. v. Barnes, 191 Colo. 278, 552 P.2d 300 (1976). Therefore, legislative intent to require insurers to offer uninsured motorist coverage favors the protection, or at least the opportunity for protection, of all motorists.1 Motorists are the intended beneficiaries of uninsured motorist coverage and therefore they have the greatest incentives and reasons for either obtaining or rejecting coverage. Car rental agencies do not share that same interest with their lessees because the agencies face no risk or potential for loss that would be covered by extending uninsured motorist coverage. The risk of loss from uninsured motorists causing damage to the lessees (and which are not covered by no-fault or liability coverage for damages to others) is borne solely by the lessees. The legislative intent of guaranteeing the “widespread availability” of uninsured motorist coverage and permitting “insureds to protect themselves” would be undermined and frustrated if only car rental agencies have the opportunity to accept or reject such insurance for their lessees.
B
A court’s primary task in construing a statute is to give effect to legislative intent. People v. Schuett, 833 P.2d 44 (Colo.1992). To discern legislative intent, the court first looks to the language of the statute. B.B. v. People, 785 P.2d 132 (Colo.1990). In my view, the General Assembly’s intent is clear: to allow motorists to protect themselves. This intent is clearly articulated in the General Assembly’s declaration of policy. § 10-4-320. In determining the scope and intent of a statute, the best guide is often the declaration of policy. People v. Gross, 830 P.2d 933 (Colo.1992). Finally, in interpreting insurance laws, the court should liberally construe them to further their remedial and beneficial purposes. Barnes, 191 Colo. at 278, 552 P.2d at 300.
The statute should be read as a whole to give effect to the policy and objective, Aulston v. United States, 915 F.2d 584 (10th Cir.1990), cert. denied, 500 U.S. 916, 111 S.Ct. 2011, 114 L.Ed.2d 98 (1991), and avoid interpretations that nullify the purpose and intent. Sigman By and Through Sigman v. Seafood Ltd. Partnership I, 817 P.2d 527 (Colo.1991). When interpreting apparently conflicting provisions, the later statute prevails. § 2-4-206, IB C.R.S. (1980); see Lininger v. City of Sheridan, 648 P.2d 1097 (Colo.App.1982) (stating that in interpreting conflicting statutes, the court is to give effect to the intent of the legislature evidenced by the later time of enactment).
In this case, the definition of “policy” was enacted in 1969 and the Uninsured Motorist Act was added to the section in 1979.2 Ch. 192, sec. 1, § 79-30-1, 1969 Colo.Sess.Laws 549; ch. 69, sec. 11, § 10-4-609, 1979 Colo. Sess.Laws 358, 377. Because the Uninsured Motorist Act and its declaration of policy were enacted subsequent to the policy definition and because excluding lessees from the protection would frustrate the intent of the statute, section 10-4^609(1) requires rental agencies to provide lessees the option to purchase uninsured motorist coverage.
The definitional section begins with the phrase that the definition of “policy” is to be *1326used “unless the context otherwise requires.” § KM-601, 4A C.R.S. (1987). In these cases, the context of the uninsured motorist provision and the legislative intent require that “policy” in section 10M — 609(1) include the provisions of a rental agreement that provide for insurance coverage.
Ill
A
The majority reasons that North-West offered to sell Passamano various insurance options at specified rates and, therefore, was an “insurer” for purposes of section 10M-609(1).
Uninsured motorist coverage protects the renter and his passengers rather than the ear rental agency.3 The renter thus acquires the same status as a “named insured” under a policy issued by a commercial carrier. Because the rental agency is insuring its lessees and their passengers, it has the same duty of good faith and fair dealing, and the same duty to provide statutorily required coverage, as any other insurer. See Budget Rent-A-Car Corp. v. Martin, 855 P.2d 1377 (Colo.1993); Martin v. Principal Casualty Ins. Co., 835 P.2d 505 (Colo.App.1991), aff'd in part and rev’d in part on other grounds. Part of the money paid to rent the automobile provides the insurance required by Colorado law, causing the rental agreement to become a contract between the car rental agency and its lessee. See Davis v. M.L.G. Corp., 712 P.2d 985 (Colo.1986). Holding that Passamano is a named insured of the North-West/Passamano agreement and allowing him to recover as an innocent injured party for the loss caused by another’s negligence gives effect to the intent of the General Assembly. See Farmers Ins. Exchange, 34 Colo.App. at 305, 527 P.2d at 918.
B
The fact that Kent signed an agreement waiving uninsured motorist coverage and that Budget is a self-insurer does not distinguish this case from Passamano regarding the fundamental requirement that a rental agency offer uninsured motorist coverage. The relevant agreement is still between the lessee and the car rental agency. In order to give effect to the intent of the General Assembly, the lessee must be given the right to refuse uninsured motorist coverage.
Budget was an insurer with respect to Kent by virtue of the rental agreement he executed. As the driver named in the car rental agreement, Kent was the named insured under the automobile insurance contract between Kent and Budget. Budget was thus required to offer uninsured motorist protection to Kent under section 10-4-609(1).
IV
An agreement between a car rental agency and a lessee that requires the lessee to elect particular types of insurance coverage creates an insurance contract. Section 10-4-609(1) requires automobile insurance providers, including car rental agencies, to provide motorists with the option to purchase or reject motorist coverage. Accordingly, I would reverse and remand with directions for further proceedings consistent with this concurrence.

. There is no major change in practice in providing lessees with an opportunity to accept or reject uninsured motorist coverage. Many car rental agencies already allow customers to check boxes to select the types of coverage they wish to purchase.

. It is noteworthy that the definition of "policy” in the provisions that were enacted with the Uninsured Motorist Act did not exclude rental agencies. See ch. 91, sec. 3, § 13-7-3(11) & (12), 1965 Colo.Sess.Laws 333, 335-36. In 1979, the uninsured motorist provision was excised from the Motor Vehicle Financial Responsibility section and placed in the Automobile Insurance Regulations sections without the attending definitions. Therefore, it is evident that the intent of the General Assembly in enacting uninsured motorist coverage was not to exclude car rental agency lessees.

. Owners of businesses that utilize motor vehicles such as taxi services, trucking companies, and delivery companies insure their vehicles to protect themselves from damages caused by the tortious acts of their agents or employee drivers, for which they may be vicariously liable. Concurrent insurance protection for the drivers is incidental rather than the primary purpose of the coverage.
The purpose of liability insurance that a rental agency provides is necessarily different — car rental agencies have no vicarious liability for the tortious acts of their lessees. Greenwood v. Kier, 125 Colo. 333, 243 P.2d 417 (1952). Because the car rental agency has no vicarious liability, the agency provides insurance to protect those to whom it rents vehicles.