Court Opinion

ID: 5150988
Source: CourtListenerOpinion
Date Created: 2022-01-02 01:55:40.160065+00
Date Added: 2024-06-11T08:25:03.152527
License: Public Domain

Justice COATS,
dissenting.
While I agree that our prior pronouncements sanctioning recovery for mental anguish caused by a willful and wanton breach of contract literally cry out for explanation and reconciliation, I do not agree that the issue is before us in this case. It seems clear, at least to me, that the legislature has already specified the precise recovery for a willful and wanton failure to pay no-fault auto insurance benefits when they are due. Because I disagree with the majority’s proliferation of recoveries for the same injuries and conduct generally, and with its allowance of more than a treble-damage recovery for willful and wanton breach of a no-fault insurance contract specifically, I respectfully dissent.
*255As part of the “Colorado Auto Accident Reparations Act,” the General Assembly has required every owner of a motor vehicle who operates or knowingly permits its operation on the public highways of this state to have in effect a complying insurance policy, including basic personal injury protection coverages as mandated by statute. See §§ 10-4-705, -706, 3 C.R.S. (2002). The failure of a motor vehicle owner to enter into and maintain such an insurance policy can result in criminal sanctions. In the event that an insurer fails to pay the benefits required under such an insurance contract when they are due, the person entitled to such benefits is provided, by statute, an action in contract to recover them. See § 10^4 — 708(1), 3 C.R.S. (2002). The General Assembly has further specifically provided that “in the event of willful and wanton failure of the insurer to pay such benefits when due, the insurer shall pay to the insured ... an amount which is three times the amount of unpaid benefits recovered in the proceeding.” § 10-4-708(1.8).
By the slimmest of margins, this court previously held that section 10-4-708 does not abrogate the common law remedy for tortious bad faith breach of an insurance contract. Farmers Group, Inc. v. Williams, 805 P.2d 419, 424-26 (Colo.1991). Relying heavily on the special duty of good faith and fair dealing created by the very nature of an insurance contract, and the distinction between a contract claim and “a tort action for bad faith breach of an insurance contract,” id. at 424, we found that legislative provision of a specific contract remedy was, in itself, insufficient to demonstrate an intent to limit recovery for common-law tort claims like bad faith breach. Whatever the wisdom of that holding at the time, it has not been disturbed by the General Assembly in the ensuing twelve years. Nothing in Williams, however, suggests its extension to breach of contract claims for willful and wanton failure to pay PIP benefits — precisely the breach of contract claim for which the legislature has specified a remedy of three times the amount of unpaid benefits. Whether or not the statute evinces a sufficient intent to abrogate all other remedies, by characterizing the failure to pay PIP benefits when due as a breach of contract and specifying the remedy for a willful and wanton failure to pay, the plain language of the statute mandates the precise amount to be recovered from an insurer for breaching a no-fault automobile insurance contract by willfully and wantonly failing to pay benefits.
Neither, in my view, does this plain reading “frustrate the essential purpose of the No Fault Act.” See maj. op. at 238. The plaintiff in this case sought recovery on multiple theories and won jury verdicts including $900,000 for willful and wanton breach of the insurance contract; $300,000 for the tort of breaching the contract in bad faith and an additional $300,000 in punitive damages for doing so; and treble damages for breach under the No-Fault Act. In what can only be described as a tour de force, the majority (in sharp contrast to the special concurrence) not only finds a meaningful distinction between recovery in contract for willful and wanton breach and recovery in tort for bad faith breach, allowing separate recoveries for both, but also “clarifies” our prior holdings recognizing a willful and wanton breach of contract claim for mental anguish by expanding that cause of action to permit recovery for a “complete range of non-economic damages.” See maj. op. at 234. On top of all this, the majority attributes to the legislature an intent to accomplish its purpose of “ ‘avoiding] inadequate compensation to victims of automobile accidents’,” maj. op. at 238 (quoting from section 10-4-702, 3 C.R.S. (2002)), by providing an additional treble damages award for willful and wanton breach. It seems to me more likely that this statement of legislative purpose refers to its treatment of fault as a consideration in auto accident eases, and that by providing a treble-damage award for a willful and wanton failure to pay no-fault insurance benefits when due, the legislature considered itself to be dictating the proper remedy for this behavior.
While everyone surely must feel sympathy for the plight of accident victims like the plaintiff, I can find no legal justification for affirming a $900,000, willful and wanton breach of contract award by expanding an already questionable theory of recovery and *256avoiding a legislatively imposed damage-cap by dubbing it waived, as the majority does; or by legislating a new rule for future cases only, rather than resolving an actual case or controversy, as the special concurrence would do. Because I consider the extent of recovery for willful and wanton failure to pay no-fault insurance benefits a policy prerogative of the General Assembly, which I believe it has exercised, I respectfully dissent.