Court Opinion

ID: 9789761
Source: CourtListenerOpinion
Date Created: 2023-08-31 01:40:50.87661+00
Date Added: 2024-06-11T15:34:08.950077
License: Public Domain

Justice QUINN
dissenting:
I am of the view that the court of appeals correctly determined that the set-off provision of American Family’s insurance *1315policy does not violate any public policy of this state. In contrast to the court of appeals, however, I would remand this case to the trial court to determine whether any part of the compensation payable to Gale F. Barnett as social security disability insurance (SSDI) benefits would also be included within the uninsured/underinsured (UM/UIM) motorist coverage of the American Family policy.
I agree with much of Chief Justice Rovi-ra’s dissent on whether the set-off provision of the policy issued to the Barnetts violates the public policy of this state. If there is a demonstrable public policy with respect to a set-off against a tort award for benefits paid from another source for the same elements of damages, it would appear to be a policy that, with some limited exceptions, disallows a double recovery for the same injury. For example, section 10-4-707(5), 4A C.R.S. (1987), requires that insurance coverage for personal injury protection (PIP) benefits be reduced to the extent that the same benefits are covered under the Colorado Workers’ Compensation Act. In similar fashion, section 10-4-713(1), 4A C.R.S. (1987), deprives a person eligible for PIP benefits of the right to recover the same benefits against the owner, user, or operator of a motor vehicle legally responsible for the claimant’s damages. Finally, again by way of example, section 13-21-111.6, 6A C.R.S. (1987), requires the court to reduce a verdict for tort damages by the amount by which the plaintiff has been wholly or partially indemnified or compensated for his or her loss by some other person, entity, or fund. If these types of set-offs do not offend public policy — and I have no reason to believe that they do, cf. Tate v. Industrial Claim Appeals Office, 815 P.2d 15, 19 (Colo.1991)— there is no reason to invalidate the set-off of social security disability insurance (SSDI) benefits against a tort award as contrary to the public policy underlying UM/UIM coverage so long as the following two conditions are present: (1) the SSDI benefits are paid to the tort claimant as compensation for the same elements of damages covered by UM/UIM insurance; and (2) the set-off would not reduce the amount payable under UM/UIM coverage to a level below the minimum statutory requirements of $25,000 per person and $50,000 per accident. §§ 10-4-609(1), 4A C.R.S. (1987) and 42-7-103(2), 17 C.R.S. (1984). When these two conditions are satisfied, the set-off of SSDI benefits becomes nothing more than a permissible method of coordinating state mandated UM/UIM coverage and federally mandated SSDI benefits for the purpose of avoiding a double recovery by a tort claimant.
To be sure, section 13-21-111.6 creates an exception to the statutory set-off in the case of collateral benefits paid “as a result of a contract entered into and paid for by or on behalf of [the claimant].” The SSDI benefits paid to Gale Barnett, however, do not qualify for this statutory exception because such benefits were not paid to her as the result of some employment contract between her and her employer, see generally Van Waters & Rogers, Inc. v. Keelan, 840 P.2d 1070, 1078 (Colo.1992), but, rather, were awarded to her as the result of a federal statutory scheme funded by a tax assessed against employers and employees. See 26 U.S.C. §§ 3101 and 3111 (1988). The compulsory nature of the federal tax, in my view, is antithetical to the contractual exception contemplated by section 13-21-111.6.
The record in this case does not permit a determination of whether the SSDI benefits paid to the Barnetts would be duplica-tive of UM/UIM coverage. I accordingly would return this case to the trial court for a resolution of that question under the standard developed in Newton v. Nationwide Mutual Fire Ins. Co., 197 Colo. 462, 594 P.2d 1042 (1979). Under Newton, the trial court should allow recovery by Gale F. Barnett of all proven elements of damages not covered by SSDI benefits up to the available limit of UM/UIM coverage (i.e., the $100,000 limit minus the $50,000 already received by the Barnetts in the Min-son settlement). Any of Gale Barnett’s *1316elements of damages for which she was or is being indemnified by SSDI benefits should be disallowed, and any elements of damages not so indemnified by SSDI benefits should be permitted. This procedure, consistent with our opinion in Newton, will preclude the double recovery of the same benefits, will provide Gale Barnett with a $100,000 limit of UM/UIM coverage for which a premium has been paid with respect to those elements of damages for which she has not been indemnified by SSDI benefits, and will prevent the insurer from reducing UM/UIM coverage below the statutory minimum of $25,000 per person and $50,000 per accident. Newton, 197 Colo, at 468, 594 P.2d at 1046.
I,therefore, would affirm that part of the court of appeals' judgment which holds that the set-off provision of the American Family insurance policy does not violate the public policy of this state, but I would remand the case to the trial court for the purpose of determining whether any part of the UM coverage available to Gale Barnett will or will not be duplicative of the SSDI benefits awarded to her.