Court Opinion

ID: 6333593
Source: CourtListenerOpinion
Date Created: 2022-04-21 15:01:54.861236+00
Date Added: 2024-06-11T09:23:29.389491
License: Public Domain

The summaries of the Colorado Court of Appeals published opinions
  constitute no part of the opinion of the division but have been prepared by
  the division for the convenience of the reader. The summaries may not be
    cited or relied upon as they are not the official language of the division.
  Any discrepancy between the language in the summary and in the opinion
           should be resolved in favor of the language in the opinion.

                                                                   SUMMARY
                                                                April 21, 2022

                                2022COA45

No. 20CA1694, Gregory v. Safeco Ins. Co. of America —
Insurance — Property and Casualty Insurance — Homeowners’
Insurance — Late Notice — Notice-Prejudice Rule

     A division of the court of appeals considers whether Colorado’s

notice-prejudice rule applies to a notice-of-loss provision in a

homeowners’ insurance policy. This rule excuses an insured’s late

filing of a claim when the insurer is unable to demonstrate that its

interests were prejudiced by the late notice. Concluding that the

supreme court has not yet extended the notice-prejudice rule to

first-party claims under homeowners’ policies — or authorized the

court of appeals to do so — the division instead holds that the

older, traditional rule still applies to such policies.

     The division also considers whether a provision of an

insurance policy requiring an insurer to give notice within 365 days
of a covered loss is invalid under section 10-4-110.8(12)(a), C.R.S.

2021, of the Colorado Homeowner’s Reform Act of 2013. This

provision provides that homeowners may still file suit against their

insurer within the applicable statute of limitations notwithstanding

any provision in their insurance policy that requires homeowners to

file suit within a shorter time period. The division concludes that

the 365-day notice provision in question does not contravene this

statute.
COLORADO COURT OF APPEALS                                          2022COA45

Court of Appeals No. 20CA1694
City and County of Denver District Court No. 19CV34856
Honorable Michael A. Martinez, Judge

Karyn Gregory,

Plaintiff-Appellant,

v.

Safeco Insurance Company of America,

Defendant-Appellee.

                            JUDGMENT AFFIRMED

                                 Division II
                          Opinion by JUDGE KUHN
                        Furman and Pawar, JJ., concur

                           Announced April 21, 2022

Roth Milne, David Roth, Jennifer A. Milne, Denver, Colorado, for Plaintiff-
Appellant

Lewis Roca Rothgerber Christie LLP, Brian J. Spano, Holly C. White, Aurora
Temple Barnes, Denver, Colorado, for Defendant-Appellee

MoGo LLC, Rodney J. Monheit, Katherine E. Goodrich, Denver, Colorado, for
Amicus Curiae Colorado Trial Lawyers Association

Waltz Reeves, Christopher R. Reeves, Denver, Colorado, for Amicus Curiae
Colorado Defense Lawyers Association
¶1    In this late-notice insurance coverage dispute, Karyn Gregory

 brought suit against her insurer, Safeco Insurance Company of

 America, after Safeco denied her first-party insurance claim for

 property damage as untimely under her homeowners’ insurance

 policy. Gregory appeals the district court’s grant of summary

 judgment to Safeco rejecting the applicability of Colorado’s notice-

 prejudice rule to policies like hers.

¶2    Our appellate courts have not yet considered this issue, and

 there appears to be uncertainty surrounding it in federal courts

 applying Colorado law. Gregory asks us to resolve this uncertainty.

 We conclude that only the supreme court may decide whether to

 replace the traditional rule with the notice-prejudice rule for first-

 party claims under homeowners’ insurance policies. We therefore

 affirm the judgment of dismissal, but we note that this case may

 present an opportunity for our supreme court to provide clarity on

 this question.

                            I.   Background

¶3    The facts of this case are undisputed. Gregory procured a

 homeowners’ insurance policy (the Policy) from Safeco that covered

 specified direct physical damage to her home that “occurs during

                                     1
 the policy period.” The Policy ran from February 15, 2017, to

 February 15, 2018, and in May 2017, a hailstorm damaged

 Gregory’s roof — a type of loss covered under the Policy.

¶4    But Gregory did not notify Safeco or file a claim for the loss

 until roughly eighteen months later, shortly after a contractor

 informed her of the hail damage. Safeco did not initially investigate

 the damage to Gregory’s home, but its initial review determined that

 the May 2017 hailstorm was the most recent one to occur near

 Gregory’s property.1 Based on this determination, Safeco

 summarily denied her claim as untimely, citing the eighteen-month

 delay and a notice provision in the Policy specific to hail damage:

           In case of a loss to which this insurance may
           apply, you must perform the following duties:

           ...

           give immediate notice to us or our agent. With
           respect to loss caused by the peril of . . . Hail,

 1 Safeco did not inspect the damage to Gregory’s roof until after she
 filed suit in December 2019. Gregory filed an affidavit by a licensed
 public adjuster who inspected her home in February 2020 — more
 than thirty-three months after the hailstorm. He believed her roof
 had visible and prevalent hail damage from the May 2017 hailstorm
 that could still have been inspected more than a year after the
 damage occurred.

                                   2
            the notice must be within 365 days after the
            date of the loss . . . .

 Under the same section, the Policy provides that “[n]o action shall

 be brought against [Safeco] unless there has been compliance with

 the policy provisions . . . .” And at the very beginning of the Policy,

 it states that Safeco “will pay claims and provide coverage as

 described in this policy if [Gregory] . . . compl[ies] with all the

 applicable provisions outlined in this policy.”

¶5    More than two years after Safeco denied her claim, Gregory

 filed suit, claiming that Safeco’s denial was a breach of contract and

 a bad-faith breach of an insurance policy, and that Safeco

 unreasonably delayed and denied payment of her claim under

 sections 10-3-1115 and -1116, C.R.S. 2021.

¶6    Safeco filed a motion for summary judgment under C.R.C.P.

 56(b), and Gregory responded with a motion for determination of a

 question of law under C.R.C.P. 56(h). Both motions addressed the

 same two issues Gregory appeals here:

      (1)   whether Colorado’s notice-prejudice rule applies, which

            would require Safeco to demonstrate it was prejudiced by

                                     3
            Gregory’s late notice before denying her benefits for an

            untimely claim; and

      (2)   whether the Policy’s 365-day notice provision is invalid

            under section 10-4-110.8(12)(a), C.R.S. 2021, which

            limits insurers’ ability to contractually shorten the

            applicable statute of limitations for insureds to file suits

            like Gregory’s against them.

¶7    The district court ruled in favor of Safeco. It concluded that

 the 365-day notice requirement did not contravene the statute-of-

 limitations provision, that Gregory’s claim was untimely under the

 plain terms of the Policy, that her delay was unexcused as a matter

 of law, and that Safeco was therefore relieved of its obligation to

 provide coverage benefits for her claim.

¶8    In so concluding, the court reasoned that the supreme court

 has not extended Colorado’s notice-prejudice rule to first-party

 claims under homeowners’ insurance policies like Gregory’s, and, in

 this absence, the supreme court’s precedent regarding the

 “traditional approach” required the court to strictly apply Gregory’s

 failure to abide by the Policy’s notice provision against her. The

                                    4
  court thus determined it did not need to reach the question of

  whether Safeco was prejudiced by Gregory’s late notice.

                              II.   Analysis

¶9     We review the court’s order granting summary judgment de

  novo. MarkWest Energy Partners, L.P. v. Zurich Am. Ins. Co., 2016

  COA 110, ¶ 11. Summary judgment is proper if there is no genuine

  issue as to any material fact and Safeco is entitled to judgment as a

  matter of law. Id.

¶ 10   We agree with the district court on both issues and therefore

  conclude that the court properly granted summary judgment to

  Safeco.

                       A.    Notice-Prejudice Rule

¶ 11   Gregory does not contend that the terms of the Policy do

  anything other than unambiguously bar coverage benefits for a

  hail-damage claim unless she provides notice to Safeco within 365

  days of her loss. Travelers Prop. Cas. Co. v. Stresscon Corp., 2016

  CO 22M, ¶ 12 (“[A]n insurance policy is a contract, the

  unambiguous terms of which must be enforced as written . . . .”).

  Nor does she contend that her delay in giving notice of her claim

  was justified. E.g., Clementi v. Nationwide Mut. Fire Ins. Co., 16

                                    5
  P.3d 223, 226-27 (Colo. 2001) (recognizing that, in certain

  circumstances, an insured may be excused for untimely notice if

  their delay in giving notice was justified).

¶ 12   Instead, Gregory argues the district court erred by not

  applying Colorado’s notice-prejudice rule to the notice-of-loss

  provision in her homeowners’ insurance policy. This rule “allow[s]

  insureds to avoid strict enforcement of a notice provision for public

  policy reasons.” Craft v. Phila. Indem. Ins. Co., 2015 CO 11, ¶ 34.

  Under it, “an insured who gives late notice of a claim to his or her

  insurer does not lose coverage benefits unless the insurer proves by

  a preponderance of the evidence that the late notice prejudiced its

  interests.” Id. at ¶ 2. If the insurer cannot show prejudice, the

  insured is “excuse[d] . . . from fulfilling a straightforward

  contractual condition — the notice requirement.” Id. at ¶ 39.

¶ 13   The supreme court has applied the notice-prejudice rule to

  notice provisions in underinsured motorist (UIM) and

  comprehensive general liability insurance policies. Clementi, 16

  P.3d at 224 (UIM policy); Friedland v. Travelers Indem. Co., 105 P.3d

  639, 641-42 (Colo. 2005) (liability policy). Gregory acknowledges

  that no Colorado court has explicitly applied this rule to

                                      6
  homeowners’ policies like hers. Nonetheless, she argues that —

  regardless of the type of insurance policy involved — supreme court

  precedent allows us to extend this rule to new types of coverage if

  we are satisfied by the public policy considerations enumerated in

  Clementi.

¶ 14   We disagree. We note the supreme court’s acknowledgement

  of the “modern trend” to extend the notice-prejudice rule to late-

  notice cases, Clementi, 16 P.3d at 229-30, but the court has been

  careful in applying and extending the rule — and indeed in the

  associated weighing of public policy considerations. In our view,

  applying the notice-prejudice rule to an entirely new class of

  insurance policies would still require departure from our supreme

  court’s precedent, an undertaking exclusively reserved to that

  court. See People v. Novotny, 2014 CO 18, ¶ 26. For this reason,

  we conclude the district court properly applied Colorado’s

  traditional approach to Gregory’s late-filed insurance claim.

          1.   The Backdrop: Colorado’s Traditional Approach

¶ 15   Traditionally, Colorado courts did not consider insurer

  prejudice in late-notice cases, no matter the type of insurance

  policy involved. See Clementi, 16 P.3d at 226. Rather, Colorado law

                                    7
  has held that “an unexcused delay in giving notice relieves the

  insurer of its obligations under an insurance policy, regardless of

  whether the insurer was prejudiced by the delay.” Id. at 227. This

  traditional approach is “grounded upon a strict contractual

  interpretation of insurance policies under which delayed notice was

  viewed as constituting a breach of contract, making the issue of

  insurer prejudice immaterial.” Id. at 226.

¶ 16   Yet, the traditional approach did not leave an insured without

  recourse in all circumstances when their insurer denied a late claim

  as untimely. Rather, Colorado law held that an insured could be

  excused for a delay in providing notice if the insured demonstrated

  “justifiable excuse or extenuating circumstances explaining the

  delay.” E.g., Certified Indem. Co. v. Thun, 165 Colo. 354, 360, 439

  P.2d 28, 30 (1968).

¶ 17   Colorado adhered to the traditional approach for nearly a

  century following the supreme court’s landmark 1909 case, Barclay

  v. London Guarantee & Accident Co., 46 Colo. 558, 105 P. 865

  (1909). Marez v. Dairyland Ins. Co., 638 P.2d 286, 288-89 (Colo.

  1981) (collecting cases and tracing the traditional approach to

  Barclay), overruled in part by Friedland, 105 P.3d 639. Indeed,

                                    8
since Barclay, Colorado courts have applied the traditional

approach to notice provisions for first-party claims under insurance

policies covering property and other personal loss. See Capitol

Fixture & Supply Co. v. Nat’l Fire Ins. Co., 279 P.2d 435, 437 (Colo.

1955) (fire insurance policy for late proof of loss); Circle C Beef Co. v.

Home Ins. Co., 654 P.2d 869, 870 (Colo. App. 1982) (fire insurance

policy for late proof of loss); Jennings v. Bhd. Accident Co., 44 Colo.

68, 73-76, 96 P. 982, 984 (1908) (disability insurance policy for late

proof of loss); Ord. of United Com. Travelers v. Boaz, 27 Colo. App.

423, 425-28, 150 P. 822, 824 (1915) (accidental death insurance

policy for late notice of loss), rev’d on other grounds, 69 Colo. 44,

168 P. 1178 (1917); see also Conn. Fire Ins. Co. v. Colo. Leasing,

Min. & Milling Co., 50 Colo. 424, 435-43, 116 P. 154, 160 (1911)

(refusing to apply traditional approach to notice-of-loss provision in

fire insurance policy based on court’s conclusion that the policy at

issue did not make timely notice a condition precedent to coverage);

Preferred Accident Ins. Co. v. Fielding, 35 Colo. 19, 22-28, 83 P.

1013, 1015-16 (1905) (same outcome for notice-of-loss provision in

accidental injury insurance case).

                                    9
¶ 18   In the 1981 case Marez v. Dairyland Insurance Co., the

  supreme court considered for the first time whether to abandon the

  traditional approach and adopt the notice-prejudice rule in the

  context of an automobile liability insurance case in which the

  insured failed to provide any notice to his insurer of an otherwise

  covered liability claim made against him. 638 P.2d at 290. In this

  no-notice context, the supreme court concluded that the “salutary

  purposes of the notice provisions should not be set aside without

  substantial justification,” and the insured’s complete lack of notice

  “did not provide a factual context compelling a departure from the

  traditional approach.” Clementi, 16 P.3d at 227 (citing Marez, 638

  P.2d at 290-91). The court thus “refused to depart” from the

  approach it traced back to Barclay, id., concluding that the

  insured’s failure to abide by the policy’s notice provision

  constituted, as a matter of law, a breach of the policy relieving the

  insurer of its obligation to cover the claim, Marez, 638 P.2d at 286,

  288-89.

¶ 19   Gregory contends that, though the traditional approach was

  alive and well in Colorado going into the twenty-first century, the

  supreme court’s modern precedent permits this court to reject the

                                    10
  traditional approach’s application to her first-party claim under a

  homeowners’ insurance policy.

             2.   Modern Cases: Adopting Notice-Prejudice
                        in Limited Circumstances

¶ 20   In 2001, the supreme court in Clementi again reviewed

  whether to abandon the traditional approach — this time in the

  context of a late-notice case under a UIM insurance policy. 16 P.3d

  at 224-25. In its analysis, the court observed that it “ha[d] not

  previously considered whether the notice-prejudice rule applies in

  UIM cases,” and that the modern trend in the majority of states has

  been to apply the notice-prejudice rule “in the context of a UIM

  case.” Id. at 225, 228. The court decided to bring Colorado in line

  with that modern trend and “expressly adopt the notice-prejudice

  rule in Colorado, as it applies to UIM cases.” Id. at 232.

¶ 21   To get to this ruling, Clementi distinguished Marez, concluding

  that “because Marez involved a no-notice liability case, we find that

  Marez is inapplicable in determining whether insurer prejudice

  should be considered in the UIM late-notice case at bar.” Id. at

  228; see also Friedland, 105 P.3d at 644 n.2. Clementi, in other

                                    11
  words, “limited [itself] to the particular context of [its] case, a UIM

  policy.” Friedland, 105 P.3d at 645.

¶ 22   In support of its adoption of the notice-prejudice rule for late-

  notice UIM cases, Clementi identified three public policies that other

  states had offered for justifying a departure from the traditional

  approach: (1) the adhesive nature of UIM insurance contracts,

  (2) the public policy objective of compensating innocent tort victims,

  and (3) the inequity of the insurer reaping a windfall by invoking a

  technicality to deny coverage. Clementi, 16 P.3d at 229; see also

  Craft, ¶ 26. Reasoning that all three policy justifications had been

  recognized in Colorado law — at least in the particular context of

  UIM insurance — the court adopted the notice-prejudice rule for

  UIM policies, concluding that “insurer prejudice should now be

  considered when determining whether noncompliance with a UIM

  policy’s notice requirements vitiates coverage.” Clementi, 16 P.3d at

  229-30.

¶ 23   Five years later, the supreme court in Friedland again revisited

  the notice-prejudice rule in a late-notice liability case, granting

  certiorari “to determine whether the notice-prejudice rule

  announced in Clementi . . . applies to liability policies” and

                                     12
  answering that question in the affirmative. Friedland, 105 P.3d at

  641.

¶ 24     The parties in Friedland argued whether Clementi’s adoption of

  the notice-prejudice rule should be limited to UIM cases. Id. at 644

  n.2. The court recognized a trend in other states to apply this rule

  to liability policies, and again it reasoned that the same public

  policy justifications outlined in Clementi — this time analyzed in the

  liability insurance context — supported the extension of the notice-

  prejudice rule to liability policies. Id. at 646-47; see also Marez,

  638 P.2d at 293 (Quinn, J., dissenting) (analyzing public policies in

  automobile liability context). In so ruling, the supreme court

  “overrule[d] Marez to the extent it applies to late-notice liability

  cases.” Friedland, 105 P.3d at 643, 645.

¶ 25     Ten years later, the supreme court again revisited the notice-

  prejudice rule in two liability insurance cases — Craft and

  Stresscon. In Craft, the supreme court declined to extend the

  notice-prejudice rule to a date-certain notice requirement in a

  “claims-made” policy — that is, a policy which “covers only those

  claims brought against the insured during the policy period and

  reported to the insurer by a date certain, typically within a brief

                                     13
  window following expiration of the policy period.”2 Craft, ¶¶ 3, 4, 7,

  32. And in Stresscon, the supreme court again declined to extend

  the rule to a different type of policy provision — a “no voluntary

  payments” clause that excluded from coverage certain payments the

  insured voluntarily made to a tort victim without the consent of

  their insurer. Stresscon, ¶¶ 2-3, 23.

¶ 26   In both cases, the supreme court noted that it had not

  previously addressed whether the notice-prejudice rule should

  apply in these contexts. Craft, ¶ 2; see Stresscon, ¶¶ 17-21. And

  for each context, the court reasoned that the public policies

  recognized in Clementi did not support the extension of the rule.

  Craft, ¶¶ 7, 43-45; Stresscon, ¶¶ 11-15.

                   3.   The Traditional Approach Still
                         Applies to Gregory’s Policy

¶ 27   Gregory contends that the Clementi line of cases requires us to

  determine if the public policies recognized in Clementi support

  extension of the notice-prejudice rule to policies like hers. Amicus

  2 The court distinguished Friedland as involving an occurrence
  liability policy as opposed to a claims-made liability policy. Craft v.
  Phila. Indem. Ins. Co., 2015 CO 11, ¶¶ 40-45. Gregory’s policy
  covered losses occurring during, not claims made in, the policy
  period.

                                    14
  in support of Gregory argues that this line of cases establishes

  notice-prejudice as the default rule in late-notice cases that applies

  unless the Clementi policies are not satisfied.

¶ 28   We disagree with both readings of these cases. We see the

  supreme court as taking a case-by-case approach that extends the

  notice-prejudice rule to only the particular type of insurance policy

  before it. Cf. Stresscon, ¶¶ 8-9 (Clementi and Friedland’s notice

  holdings “did not . . . also implicitly extend our newly minted

  notice-prejudice rule to no-voluntary-payments or consent-to-settle

  provisions.”). The supreme court has not yet unequivocally applied

  the notice-prejudice rule to all late-notice cases.

¶ 29   To the contrary, it has specifically limited its notice-prejudice

  holdings to UIM and liability insurance policies. In Clementi and

  Friedland, it expressly said so. Craft, ¶ 21 (“Although we limited

  our holding in Clementi to late notice in the UIM context, our

  analysis in that case laid the groundwork for our later decision in

  Friedland.”); Friedland, 105 P.3d at 643 (“In this case, we apply the

  notice-prejudice rule to liability policies.”). Moreover, both cases

  explicitly relied on public policy justifications specific to UIM and

  liability policies, respectively. Craft even noted on multiple

                                     15
  occasions that Clementi first adopted the notice-prejudice rule “for

  UIM cases” and Friedland later “extended” it to liability policies.

  Craft, ¶¶ 7, 16, 23, 25, 26.

¶ 30   Against the historical backdrop of the traditional approach in

  Colorado, these limited holdings — and their treatment of Marez in

  particular — do not persuade us that the court has implicitly

  overruled its traditional approach for all insurance policies. As

  noted, Friedland overruled Marez “to the extent it applies to

  late-notice liability cases.” Friedland, 105 P.3d at 643, 645. And in

  Clementi, the court distinguished Marez on the basis that Clementi

  involved a UIM rather than liability policy. Id. at 645. Together,

  these cases show that the court cabined Marez’s refusal to depart

  from the traditional approach to the no-notice liability context —

  not the no-notice context for any type of insurance policy.3 In any

  3 While the supreme court in Clementi explicitly disapproved of this
  court’s extension of Marez to “non-liability late-notice cases,” this
  statement came in the context of the supreme court’s discussion of
  this court’s application of Marez to both UIM and liability policies.
  Clementi v. Nationwide Mut. Fire Ins. Co., 16 P.3d 223, 227-28 & n.5
  (Colo. 2001) (citing court of appeals cases applying Marez to UIM
  policies). In this context, we do not read “non-liability” to mean “all
  types of policies that aren’t liability policies” but rather only the
  type before the Clementi court — a UIM policy. See Friedland v.
  Travelers Indem. Co., 105 P.3d 639, 644 n.2 (Colo. 2005) (“We

                                    16
  event, Marez didn’t announce the traditional approach; it merely

  applied it. Id.; Marez, 638 P.2d at 286, 288. We thus disagree that

  the supreme court has jettisoned the traditional approach for all

  but no-notice cases.

¶ 31   Further, contrary to Gregory’s assertion, this court has never

  ruled that the supreme court has given us authority to use the

  Clementi justifications to extend the reach of the notice-prejudice

  rule to policies other than liability or UIM. In MarkWest, on which

  Gregory relies for this assertion, the division held that “Colorado’s

  notice-prejudice rule applies even where . . . the notice requirement

  is a condition precedent to coverage under an occurrence liability

  policy.” MarkWest, ¶ 31. But to reach this conclusion, MarkWest

  did not analyze or otherwise rely on the Clementi policies, and,

  notably, MarkWest involved the same type of policy as that in

  Friedland. See id. at ¶¶ 16, 21-31. Additionally, the supreme court

  has seemingly disapproved of this court using the Clementi policies

  recognize that [Clementi] might be read as reaffirming the Marez
  rule as to all cases other than UIM cases. We clarify that we did not
  intend to make a holding to this effect; rather, we were
  distinguishing Marez at that time and chose to leave the potential
  applicability of our Clementi rationale to a liability policy case to
  some future time.”).

                                    17
  to extend the notice-prejudice rule to new types of provisions in

  UIM and liability policies. Compare Lauric v. USAA Cas. Ins. Co.,

  209 P.3d 190, 193 (Colo. App. 2009) (“Although the decision in

  Clementi involved a late notice of claim, we conclude that the

  supreme court, as evidenced by the decision in Friedland and its

  disapproval of the Hawkeye decision in Clementi, would apply the

  notice-prejudice rule to an insured's failure to notify the insurer of,

  and obtain its consent to, a settlement with a tortfeasor in a UIM

  case.”), with Stresscon, ¶¶ 8-9 (“We did not [in Friedland] also

  implicitly extend our newly minted notice-prejudice rule to no-

  voluntary-payments or consent-to-settle provisions.”).

¶ 32   In our view, given its decision to carefully circumscribe its

  holdings rather than announce a broad rule, the supreme court has

  not yet indicated that the notice-prejudice rule should apply to all

  types of insurance policies. We therefore conclude that the task of

  deciding whether to extend the notice-prejudice rule to a new type

  of insurance policy is not one we may undertake.

¶ 33   In concluding this, we note that federal district courts

  applying Colorado law have split, under facts nearly identical to

  those here, on whether the notice-prejudice rule applies to first-

                                     18
party claims under homeowners’ insurance policies. Compare

Cherry Grove E. II Condo. Ass’n v. Phila. Indem. Ins. Co., No.

16-cv-02687-CMA-KHR, 2017 WL 6945038, at *4-5 (D. Colo. Dec.

20, 2017) (in late-notice hail-damage case, concluding the Clementi

policy justifications do not support extension of the notice-prejudice

rule to “first-party insurance coverage”), with Hiland Hills

Townhouse Owners Ass’n v. Owners Ins. Co., No. 17-cv-1773-MSK-

MEH, 2018 WL 4537192, at *4-6 (D. Colo. Sept. 20, 2018)

(concluding the opposite). But even Hiland Hills seemed to

recognize that its conclusion might not be based on controlling

Colorado precedent, but rather on a prediction about what the

supreme court would do with its existing precedent if faced with

this issue. See Hiland Hills, 2018 WL 4537192, at *6 (“[T]o the

extent that Friedland does not already control the outcome here,

this Court is persuaded that the Colorado Supreme Court’s analysis

in that case would yield the conclusion that the notice/prejudice

rule is applicable in the first-party casualty insurance context as

well.”); see also Rocky Mountain Prestress, LLC v. Liberty Mut. Fire

Ins. Co., 960 F.3d 1255, 1259 (10th Cir. 2020) (when Colorado law

has not addressed a specific issue, the federal court will predict

                                  19
  what the Colorado supreme court would hold). And, while both

  cases analyzed the Clementi policy justifications to reach their

  respective conclusions, a third federal case concluded that even

  undertaking this Clementi analysis would be improper, as it would

  be premised on a prediction that the supreme court would overrule

  its existing precedent with respect to the traditional approach. 656

  Logan St. Condo. Ass’n v. Owners Ins. Co., 389 F. Supp. 3d 946,

  952-56 (D. Colo. 2019); see also 6 W. Apartments, LLC v. Ohio Cas.

  Ins. Co., No. 1:20-cv-02243-RBJ, 2021 WL 4949154, at *7 (D. Colo.

  Oct. 25, 2021) (agreeing with the analysis in 656 Logan Street and

  stating that “[t]he cases establishing notice-prejudice regimes for

  some insurance contracts contain policy justifications and broad

  language that makes their applicability to other insurance regimes

  unclear”).

¶ 34   We also acknowledge that the supreme court has, at times,

  spoken more broadly about the implications of its holdings in

  Clementi and Friedland. See Stresscon, ¶ 24 (Márquez, J.,

  dissenting) (“[O]ur own precedent recogniz[es] that, where a

  provision of an insurance contract does not fundamentally define

  the scope of coverage, but instead protects the insurer’s opportunity

                                    20
to investigate and defend or settle claims, the insured’s violation of

that provision should not present an absolute bar to recovery.”);

Friedland, 105 P.3d at 645 (“Because of its reasoning and departure

from the Barclay and Marez line of cases in favor of the notice-

prejudice rule adopted by the majority of jurisdictions throughout

the United States, we find that Clementi, not Marez, is the

applicable stare decisis precedent.”); Friedland, 105 P.3d at 647

(“[W]e recognize that our decision today leaves little, if any, vitality

to Marez because disputes will likely arise only in the context of late

notice by an insured . . . .”). Moreover, at least two states that have

considered this issue have extended the notice-prejudice rule to

notice provisions for first-party claims for coverage. Pitzer Coll. v.

Indian Harbor Ins. Co., 447 P.3d 669 (Cal. 2019) (notice-of-loss

provision in policy covering remediation for discovered pollution

conditions); Estate of Gleason v. Cent. United Life Ins. Co., 2015 MT

140, 350 P.3d 349 (notice-of-loss provision in cancer benefit

insurance policy); see also Ridglea Estate Condo. Ass’n v. Lexington

Ins. Co., 415 F.3d 474, 479-80 (5th Cir. 2005) (predicting that

Texas law would apply the notice-prejudice rule to notice-of-loss

provision in property insurance policy); but see GuideOne Mut. Ins.

                                    21
  Co. v. First Baptist Church of Brownfield, 495 F. Supp. 3d 428,

  435-37 (N.D. Tex. 2020) (predicting that Texas law would not apply

  the notice-prejudice rule to proof-of-loss provision in property

  insurance policy).

¶ 35   But fundamentally, the purpose of the notice-prejudice rule is

  to allow the insured to avoid a forfeiture for reasons of public

  policy.4 Craft, ¶ 34. And in Clementi and Friedland, the supreme

  court concluded that such reasons warranted the extension of the

  rule to the insurance policies before it. But the traditional

  approach itself serves its own public policies — policies that might

  counsel in favor of forfeiture in this instance. E.g., id. at ¶ 35;

  Marez, 638 P.2d at 291; Stresscon, ¶ 12. Gregory, in essence, asks

  us to predict that the supreme court would conclude that the public

  policies it identified in Clementi would override the policies it has

  identified as underpinning the traditional approach.

¶ 36   For her part, Gregory argues that the three Clementi policy

  justifications provide good reasons for extending the notice-

  4We note that, ordinarily, this court may examine whether a
  provision of an insurance contract is void as against public policy.
  But “the notice-prejudice rule does not render a notice provision
  void,” but rather only excuses late notice. Craft, ¶ 34.

                                     22
prejudice rule to her policy. See Friedland, 105 P.3d at 645 (“We

have a heightened responsibility to scrutinize insurance policies for

provisions that unduly compromise the insured’s interests . . . .”).

First, she argues that, like in the UIM or automobile liability

context, homeowners’ insurance contracts are adhesive, as insureds

enter into them “for the financial security obtained by protecting

themselves from unforeseen calamities and for peace of mind,

rather than to secure commercial advantage as with a negotiated

business contract,” and they are “typically provided with form

contracts promulgated by the insurer” in which there is a disparity

of bargaining power. Friedland, 105 P.3d at 646. Second, she

continues, like in the UIM context, the Policy protects the

homeowner who invokes it for damages and who should be made

whole within the limits of the coverage. While insured homeowners

are not technically victims of a tort, Gregory notes that such

insureds have suffered a loss — they are victims, in essence, of

“acts of god” rather than a human tortfeasor — and coverage for

this loss is a “fundamental purpose” of homeowners’ insurance.

See id. And third, Gregory argues that insured homeowners pay

premiums for this coverage, and whether an insurer’s interests

                                  23
  would suffer because of technical late notice is exactly what the

  notice-prejudice rule is intended to determine.

¶ 37   Gregory argues that these policy reasons warrant extension of

  the notice-prejudice rule to first-party claims in the homeowners’

  insurance context. Maybe so, but we do not see this policy

  judgment as ours to make. See Novotny, ¶ 26 (“If a precedent of

  this Court has direct application in a case, yet appears to rest on

  reasons rejected in some other line of decisions, the Court of

  Appeals should follow the case which directly controls, leaving to

  this Court the prerogative of overruling its own decisions.” (quoting

  Rodriguez de Quijas v. Shearson/Am. Express, Inc., 490 U.S. 477,

  484 (1989))). The traditional approach already has its own built-in

  safety valve for late-filing insureds — the above-discussed doctrine

  of “justifiable excuse.” We think that only the supreme court may

  add the notice-prejudice rule to this framework.

¶ 38   This leaves us with older supreme court cases applying the

  traditional approach to similar notice provisions in policies covering

  property loss. E.g., Capitol Fixture & Supply Co., 279 P.2d at 435

  (fire insurance case applying traditional approach to a late-filed

  proof of loss). Gregory’s policy included a requirement that she

                                    24
  report hail damage within 365 days, and coverage benefits under

  the Policy were conditioned on complying with its terms. Under this

  approach, then, Gregory’s timely notice of loss was a condition

  precedent for her contractual right to recover for the hail damage to

  her home. See MarkWest, ¶ 13 (“[P]rinciples of contract

  interpretation . . . would ordinarily lead us to conclude that timely

  notice of [an incident triggering coverage] was a condition precedent

  that had to be satisfied before coverage under the policy would be

  extended to [that] incident[].”); Fielding, 35 Colo. at 25, 83 P. at

  1015-16 (“[W]hile notice is a condition precedent to maintaining an

  action, a failure on the part of the insured or beneficiary under a

  policy of insurance to comply with its terms with respect to notice

  after loss, will not result in a forfeiture of the policy unless, by the

  express terms thereof, or by necessary implication, such was the

  contract of the parties.”). Gregory’s unexcused late notice therefore

  relieved Safeco of its obligation to cover this loss. See Clementi, 16

  P.3d at 227.

¶ 39   For these reasons, we conclude that the traditional approach

  still applies to the notice provision in Gregory’s homeowners’

  insurance policy. The district court thus did not err in declining to

                                      25
  determine whether Safeco was prejudiced by Gregory’s untimely

  notice. See id. at 226-27 (Under the traditional approach, “delayed

  notice [is] viewed as constituting a breach of contract, making the

  issue of insurer prejudice immaterial.”).

                         B.   Statute of Limitations

¶ 40   Next, Gregory contends that the 365-day notice provision in

  the Policy violates section 10-4-110.8(12)(a) of the Colorado

  Homeowner’s Reform Act of 2013. This provision states:

             Notwithstanding any provision of a
             homeowner’s insurance policy that requires
             the policyholder to file suit against the insurer,
             in the case of any dispute, within a period of
             time that is shorter than required by the
             applicable statute of limitations provided by
             law, a homeowner may file such a suit within
             the period of time allowed by the applicable
             statute of limitations . . . .

  § 10-4-110.8(12)(a).

¶ 41   Gregory argues that the 365-day notice provision contravenes

  this statute because it effectively shortens the applicable statute of

  limitations to 365 days — shorter than that for her legal claims. We

  agree with the district court that a policy requirement to file a

  timely claim with an insurer has no bearing on the insured’s ability

  to file a timely lawsuit for the insurer’s alleged violations of that

                                     26
  policy.5 We base this conclusion on principles of accrual and a

  plain reading of the 365-day notice provision in question. See

  MarkWest, ¶ 13 (“We construe insurance policies according to

  principles of contract interpretation.”).

¶ 42   First, “[i]ntegral to any statute of limitations is the time of

  accrual: the time when the proverbial clock starts ticking and the

  statute of limitations begins to run.” Rooftop Restoration, Inc. v. Am.

  Fam. Mut. Ins. Co., 2018 CO 44, ¶ 13. The basis of each of

  Gregory’s legal claims is Safeco’s allegedly wrongful handling of her

  insurance claim for coverage benefits. See Emenyonu v. State Farm

  Fire & Cas. Co., 885 P.2d 320, 324 (Colo. App. 1994). Gregory’s

  legal claims did not begin to accrue, then, until at the earliest she

  knew or should have known that Safeco wronged her in handling

  her insurance claim. See § 13-80-108(1), (6), C.R.S. 2021;

  Daugherty v. Allstate Ins. Co., 55 P.3d 224, 226 (Colo. App. 2002),

  superseded by statute as stated in Brodeur v. Am. Home Assurance

  5 Because we conclude this, we reach neither Safeco’s contention
  that Gregory’s motion for a determination of a question of law was,
  in fact, a motion for summary judgment filed after the deadline for
  dispositive motions, nor Gregory’s responses that her motion was
  rather a timely filed cross-motion for summary judgment and that,
  either way, Safeco did not preserve its contention.

                                     27
  Co., 169 P.3d 139 (Colo. 2007). And by definition, Safeco could not

  even begin handling her insurance claim — much less handle it

  wrongfully — until Safeco received notice of it. Emenyonu, 885 P.2d

  at 324. Notice of Gregory’s insurance claim was thus a prerequisite

  to accrual of her legal claims based on Safeco’s wrongful handling

  of that insurance claim.

¶ 43   Second, the 365-day notice provision on its face does not bar

  Gregory from bringing suit against Safeco — either within 365 days

  or beyond. “[A]n insurance policy is a contract, the unambiguous

  terms of which must be enforced as written,” Stresscon, ¶ 12, and

  this notice provision only purports to define one of Gregory’s duties

  under the contract. Far from limiting Gregory’s window to file suit,

  this provision instead defines a circumstance in which Gregory —

  not Safeco — breaches the contract and forfeits entitlement to

  coverage benefits for an otherwise covered loss.

¶ 44   The duration, or even the existence, of a provision requiring

  Gregory to notify Safeco of covered losses within a certain window

  thus has no bearing on her window to file suit for Safeco’s alleged

  wrongdoing under that contract. We therefore conclude that the

                                   28
  365-day notice provision in Gregory’s Policy does not contravene

  section 10-4-110.8(12)(a).

                               III.   Conclusion

¶ 45   The judgment is affirmed.

       JUDGE FURMAN and JUDGE PAWAR concur.

                                       29