Opinion by JUDGE ROY
¶ 1 American Family Mutual Insurance Company (the insurance company), appeals the judgment and award of damages to Jennifer Hansen (the claimant) on her claim for an unreasonable delay or denial of a covered benefit under her underinsured motorist (UIM) coverage pursuant to sections 10-3-1115, -1116, C.R.S.2013 (the statutory claim). We affirm.
¶ 2 The insurance company contends that the trial court erred in: (1) concluding that the insurance policy was ambiguous; (2) refusing to award a directed verdict to insurer on both the common law bad faith claim (the common law claim) and the statutory claim when the identity of the named insured on the policy was "fairly debatable"; (3) entering judgment in favor of the claimant in the amount of $150,000 together with attorney fees and costs on the statutory claim when the jury awarded no damages; and (4) awarding the statutory penalty under section 10-13-1116(1).
¶ 3 On December 30, 2007, the claimant was injured while riding as a passenger in her boyfriend's vehicle when it rear-ended a pickup truck at a high rate of speed. On April 24, 2008, she filed a claim for underinsured motorist (UIM) benefits under an insurance policy issued by the insurance company (the policy). That claim remained pending while she pursued her claim against the boyfriend's insurer. In the fall of 2009, she settled her claim with the boyfriend's insurer — with the consent of the insurance company — for policy limits of $25,000.
¶ 4 The claimant then pursued her UIM claim. The insurance company's records indicated that the named insureds on the policy at the time of the accident were the claimant's mother and stepfather, William and Joyce Davis (the parents), so the company requested proof that the claimant resided with the parents on the day of the accident, which was a condition of the UIM coverage. Thereafter, the insurance company made several unsuccessful attempts to contact the claimant to discuss her claim, but she did not return messages.
¶ 5 On January 18, 2010, the claims adjuster sent the claimant a letter requesting "a recorded statement and verification of [her residence at the time of the accident] in order to determine if [she was] eligible for [UIM] Coverage under [the parents'] automobile policy." The claims adjuster advised the claimant that if it did not hear from her within thirty days, the claim would be closed. On April 27, 2010, not having heard from the claimant, the claims adjuster denied coverage,
¶ 6 On August 5, 2010, the claimant filed this action against the insurance company asserting a breach of contract claim, the common law claim, and the statutory claim.
¶ 7 On December 8, 2010, the claimant filed a motion for partial summary judgment asserting, among other things, that the insurance policy was ambiguous as to the identity of the insured, relying, in part, on D.C. Concrete Management, Inc. v. Mid-Century Ins. Co., 39 P.3d 1205 (Colo.App.2001). The claimant argued that the insurance policy was ambiguous based on lienholder's statements issued by the insurance company's local agent (the agency), copies of which were attached to the motion.
¶ 8 On December 27, 2010, the insurance company filed a cross-motion for summary judgment asserting that the policy was unambiguous, that the parents were the named insureds, that the claimant was not a resident of the parent's residence and, therefore, the policy afforded claimant no UIM coverage on the day of the accident. The insurance company asserted that the agency-issued lienholder statements attached to claimant's motion, referred to as declaration pages, could not create an ambiguity.
¶ 9 On December 29, 2010, however, the insurance company was informed that the claimant had owned the insured vehicle from the inception of the policy and on the day of the accident. Within a week of that disclosure the insurance company notified the claimant that it would reform the policy and provide coverage for her injuries.
¶ 10 On January 5, 2011, the insurance company filed a motion to withdraw its cross-motion for summary judgment relating to the ambiguity issue. In that motion, it stated, in pertinent part, as follows:
¶ 11 As a result of retroactively reforming the policy to recognize claimant as the insured, on February 15, 2011, the insurance company extended a settlement offer of $17,000 on the contract claim only. On March 1, 2011, six weeks before trial was scheduled to begin and eight weeks after being advised that claimant was the owner of the car, the parties entered into mediation which resulted in a settlement of the contract claim by the payment of $75,000, the maximum policy benefit.
¶ 12 On March 9, 2011, the insurance company, conceding that the only claims remaining were the common law and statutory claims, filed a motion for a determination of
¶ 13 On April 21, 2011, the claimant filed a trial brief on the ambiguity issue, again arguing the application of D.C. Concrete.
¶ 14 Trial commenced on April 27, 2011. On the first day the trial court heard the arguments of counsel on the ambiguity issue and concluded:
¶ 15 The case proceeded to trial on the common law and statutory claims. At the conclusion of trial, the jury completed three special verdict forms pertinent to this appeal.
¶ 16 First, it found that the claimant was a named insured under the insurer's auto policy.
¶ 17 Second, as to the claimant's common law claim, the jury found that the insurance company did not "unreasonably deny payment of [the claimant's] insurance claim," or "know its denial of such claim was unreasonable," or "recklessly disregard the fact that its position was unreasonable"; and, although the claimant had incurred damages, the insurance company's denial of the claim was not a cause of those damages.
¶ 18 Third, as to the claimant's statutory claim, the jury found that (1) the claimant incurred damages; (2) the insurance company denied and/or delayed payment without a reasonable basis for its action; and (3) the insurance company's unreasonable conduct was a cause of the claimant's damages and losses. In addition, the jury found that the UIM benefit for which payment was delayed or denied without reasonable basis was $0.
¶ 19 The trial court entered judgment on the jury's verdict in favor of the claimant on her statutory claim, awarded her attorney fees and costs, but did not enter a monetary award. The claimant filed a motion to amend the judgment and requested that the court award a statutory penalty of two times the covered benefit, or $150,000, under section 10-13-1116(1), in addition to attorney fees and costs. The trial court granted the claimant's motion.
¶ 20 The insurance company filed a motion to amend the judgment, arguing that the court had incorrectly calculated the statutory penalty. The trial court conducted a hearing on the insurance company's motion, denied it, and issued a final judgment in favor of the claimant for $199,683.28 in attorney fees and costs, and a $150,000 penalty under section 10-3-1116.
¶ 21 The insurance company argues that the trial court erred in concluding that the insurance policy was ambiguous and by referring its construction to the jury. We are not persuaded by either argument.
¶ 22 The interpretation of an insurance contract and the determination of whether that contract is ambiguous are questions of law, which we review de novo. See Roberts v. Am. Family Mut. Ins. Co., 113 P.3d 164, 167 (Colo.App.2004), rev'd on other grounds, 144 P.3d 546 (Colo.2006).
¶ 23 Terms used in an insurance contract are ambiguous when they are susceptible of more than one reasonable interpretation. Hecla Mining Co. v. N.H. Ins. Co., 811 P.2d 1083, 1091 (Colo.1991). "We review the interpretation of an insurance policy de novo, employing contract-interpretation principles. We construe the plain language of the contract to effectuate the intent of the parties, and we resolve ambiguities in favor of the insured." Shelter Mut. Ins. Co. v. Mid-Century Ins. Co. 246 P.3d 651, 666 (Colo.2011) (citation omitted).
¶ 24 The policy is organized into three sections: (1) the declaration page; (2) general provisions; and (3) state-specific provisions, disclosures, and endorsements.
¶ 25 A declaration page was attached to the front of the policy at the time it was issued and an amended declaration was mailed to the named insured in the normal course of business upon amendment of the policy. It contained information particular to the policy, including: (1) the policy number; (2) the named insureds; (3) effective dates; (4) a description of the insured vehicle; (5) coverages and limits of liability; (6) identification of applicable endorsements, which here include the UIM coverage; and (7) an identification of the insurance agency. In addition, it contained the following statement (the declaration statement) immediately above facsimile signatures of the president and secretary of the insurance company:
¶ 26 As pertinent here, the declaration page maintained by the insurance company and effective on the date of the accident named the claimant's parents as the named insureds with their residence address, and identified the insured vehicle as a 1994 Ford Escort. It also provided for bodily injury liability coverage with liability limits of $100,000 per person and $300,000 per accident, comprehensive coverage with a $500 deductible, and collision coverage with a $500 deductible. In addition, it referred to a UIM endorsement with liability limits of $100,000 for each person and $300,000 for each accident.
¶ 27 The insurance company presented historical declaration pages insuring the claimant's vehicle for the following effective periods: (1) August 1, 2002, to August 1, 2003; (2) October 1, 2002, to August 1, 2003; (3) April 9, 2007, to August 1, 2007; (4) November 26, 2007, to August 1, 2008; (5) April 23, 2008, to August 1, 2008; (6) January 31, 2009, to August 1, 2009; and (7) June 1, 2009, to August 1, 2009. The commencement date of the effective period changed with each declaration page to coincide with the date the declaration page was issued. As to all these declaration pages, the parents were the named insureds. The declaration page, by the language of the policy, was incorporated into the policy.
¶ 28 The lienholder statements are very similar in appearance to the declaration pages in that they provided: (1) the policy number; (2) the named insureds; (3) effective dates; (4) a description of the insured vehicle; (5) coverages and limits of liability; (6) identification of applicable endorsements, which here include the uninsured/ underinsured motorist coverage; (7) the declaration statement followed by the facsimile signatures of the president and secretary of the insurance company; and (8) an identification of the insurance agency.
¶ 30 Neither the claimant nor the parents produced any declaration pages from their files or records. Instead, the claimant submitted lienholder statements hereinafter described, arguing that they conflicted with the declaration pages and thereby created an ambiguity.
¶ 31 The claimant initially contacted the agent in April 2008, after the accident, requesting a copy of her insurance policy. The agent telecopied a declaration page to her with effective policy dates of March 10, 2008, to August 1, 2008, which designated the parents as the named insureds.
¶ 32 However, the claimant relied on a lienholder statement dated April 9, 2007. The lienholder statement (1) related to the policy; (2) identified "Davis, Jenny" as the named insured at the parents' home address; (3) had effective dates of "December 15, 2006 to UNTIL CANCELLED"; (4) had an entry date of April 9, 2007; and (5) provided for a policy inception date of August 1, 2002. This lienholder statement suffers from several anomalies, two of which are: (1) the claimant is not, and never has been, named "Jenny Davis"; and (2) it is the only document stating that the policy remains effective "UNTIL CANCELLED." These anomalies can be attributed to the fact that the agency had authority to modify those entries.
¶ 33 The trial court relied, as does the claimant on appeal, on D.C. Concrete, 39 P.3d at 1205. In that case, the issue was whether the named insured designation of "Rafael Sanchez DC Concrete Management" on the declaration page was ambiguous and included D.C. Concrete Management, Inc. (the corporation). Id. at 1208. The trial court concluded it was not ambiguous and did not include the corporation. A division of this court disagreed, stating: "From the language `Rafael Sanchez DC Concrete Management,' one cannot tell whether there is one named insured or two. Nor can it be ascertained whether DC Concrete Management is intended as a d/b/a designation for an individual or refers to a separate business entity." Id. There, the ambiguity arose from the designation of the named insured on the declaration page.
¶ 34 Here, any ambiguity arises not from an ambiguous designation of the named insured on the applicable declaration page, but from the preparation and delivery to the claimant of a lienholder statement by the insurance agent which was inconsistent with the declaration pages maintained by the insurance company.
¶ 35 We note that throughout the proceedings before the trial court, with rare exception, the trial court and the parties referred to the lienholder statements as declaration pages. Indeed, the lienholder statements and the declaration pages are virtually identical in many material ways. Most importantly, both contained the above-quoted declaration statement followed by facsimile signatures of the president and secretary of the insurance company.
¶ 36 The April 9, 2007, lienholder statement, in our view, despite its anomalies, creates an ambiguity in the insurance policy as to the identity of the named insured because it conflicts with the declaration pages. Accordingly, we conclude that the trial court did not err in reaching the same conclusion.
¶ 37 The insurance company argues that because the claimant's claim for coverage
¶ 38 A case is moot when the relief sought would have no practical effect on the outcome of the controversy. Gresh v. Balink, 148 P.3d 419, 421 (Colo.App.2006) (citing Crowe v. Wheeler, 165 Colo. 289, 295, 439 P.2d 50, 53 (1968)). When subsequent events render an issue presented in litigation moot, an appellate court will decline to render an opinion on the merits. USAA v. Parker, 200 P.3d 350, 356 (Colo.2009) (citing Van Schaack Holdings, Ltd. v. Fulenwider, 798 P.2d 424, 426-27 (Colo.1990)).
¶ 39 Here, the jury found for the insurance company on the common law claim. Therefore, we conclude the issue is moot as to that claim.
¶ 40 In Sanderson v. Am. Family Mut. Ins. Co., 251 P.3d 1213 (Colo.App.2010), the insured brought the common law claim against a UIM insurer. The trial court granted the insurer summary judgment, concluding that the claim was fairly debatable because there was a genuine issue of material fact as to the respective fault of the insured and the third party driver, and a genuine issue of law as to the amount owed under the policy. A division of this court reversed, stating, in pertinent part:
Id. at 1217-18.
¶ 41 Subsequently, in Vaccaro v. Am. Family Ins. Grp., 2012 COA 9, ¶ 44, 275 P.3d 750, 761, a different division dealt with "fairly debatable" in the context of a statutory claim under section 10-3-1116. The insurer initially concluded that the insured's injuries were adequately covered by the payment made by the third party's insurer, and made a nominal offer. The insured then obtained an independent medical examination which concluded that the insured had suffered facet bone injury in his spine along with other injuries and recommended what was essentially a life-long treatment regimen. The insurer did not reconsider its settlement offer, and the insured brought a statutory claim. Following an adverse jury verdict, the insurer filed a motion for judgment notwithstanding the verdict which the trial court denied, and from that order the insurer appealed, claiming, among other things, that it was entitled to judgment as a matter of law because damages sustained by the insured were "fairly debatable."
¶ 42 The division, after discussing the term "fairly debatable" with respect to the common law claim, and relying in part on Sanderson, stated:
Id. at ¶ 44, 275 P.3d at 760.
¶ 43 We are persuaded by the rationale, analysis, and conclusions reached in Sanderson and Vaccaro. Therefore, we conclude that even assuming coverage here was "fairly debatable" because the policy was arguably unambiguous as to the named insured, the insurance company is not entitled to judgment as a matter of law on the claimant's statutory claim.
¶ 44 The insurance company contends that the trial court erred in awarding two times the covered benefit to the claimant when the jury found that, although claimant had incurred damages, the amount of insurance benefit for which payment was unreasonably delayed or denied was "0." It further contends that the trial court erred in its calculation of the statutory penalty under section 10-3-11 16(1). We disagree with both contentions.
¶ 45 The proper interpretation of a statute is a question of law we review de novo. See Kisselman v. Am. Family Mut. Ins. Co., 292 P.3d 964, 969 (Colo.App.2011). Our primary goal in statutory interpretation is to determine and give effect to the intent of the legislature. Id. We look first to the plain and ordinary meaning of the statutory language. Id. If the language of the statute is plain and its meaning is clear, it must be applied as written, and we do not resort to any principle of statutory interpretation. In re Estate of Holmes, 821 P.2d 300, 303 (Colo. App.1991). Statutes must be construed as whole, and, thus, a court interpreting a statute must strive to give consistent, harmonious, and sensible effect to all of its parts. City of Grand Junction v. Sisneros, 957 P.2d 1026, 1028 (Colo.1998).
¶ 46 Section 10-3-1115 provides, in pertinent part, as follows:
(Emphasis added.)
¶ 47 Section 10-3-1116 provides, in pertinent part, as follows:
(Emphasis added.)
¶ 48 With respect to the statutory claim, the jury was instructed in conformity with CJI-Civ. 4th 25:4 (2010).
¶ 49 The trial court initially entered judgment on the verdict in favor of the claimant for attorney fees and costs, but awarded no damages. The claimant filed a motion to amend the verdict and to award two times the covered benefit under section 10-3-1116(1).
¶ 50 In response to the claimant's motion, the trial court stated:
¶ 51 Sections 10-3-1115 and -1116 deal with the denial, or delay in the payment of, a covered benefit.
¶ 52 In determining a UIM covered benefit the following parameters apply: (1) the damages, if any, suffered by the insured in the covered accident;
¶ 53 Here, the damages suffered by the claimant in the accident were not independently determined. However, in the mediated settlement of the claimant's breach of contract claim, the insurance company agreed to pay the claimant the stated UIM policy limit and payment made by the third-party's insurer, $75,000. By doing so, the parties defined the covered benefit and disposed of the claimant's contract claim.
¶ 54 First, we address the insurance company's argument that the claimant was required to prove damages attributable to the denial or delay in order to recover under sections 10-3-1115 and -1116. This argument
¶ 55 Under the plain language of section 10-3-1115, the claimant was required to prove that payment of an insurance covered benefit was unreasonably delayed or denied. There is no requirement under the statutory claim that the claimant suffer and prove damages attributable to any unreasonable delay or denial in the payment of the "covered benefit." Turner v. State Farm Mut. Auto. Ins. Co., No. 09-CV-01926 CMA-KLM, 2010 WL 3239270 (D.Colo. Aug. 12, 2010); see generally Erin Robson Kristofco, CRS §§ 10-3-1115 and -1116: Providing Remedies to First-Party Claimants, 39 Colo. Law. 69, 71 (July 2010). In our view, any reference to "damages" in the instruction and the special verdict form refers to damages incurred by the claimant in the underlying accident. Here the jury was not instructed to find, or what to consider in finding, the damages suffered by the claimant in the covered accident. To the extent the instruction and special verdict form can be read to mean "damages" otherwise, they do not reflect the clear and unambiguous statute.
¶ 56 The two parts of the statute, when taken together, expressly provide that "if the insurer [unreasonably] delayed ... payment of a covered benefit," the claimant is entitled to an award of "two times the covered benefit."
¶ 57 There is no dispute that the covered benefit under the reformed policy was $75,000. In our view, the third element in CJI-Civ. 4th 25:4 (2010), and the third special interrogatory in the special verdict requiring that the insurer caused the "plaintiff's damages," do not accurately reflect the clear and unambiguous provisions of the statute.
¶ 58 Finally, to the extent the insurance company argues that the jury verdict is inconsistent and irreconcilable, and therefore requires reversal because it awarded "0" in response to the fourth interrogatory, under the circumstances here, we disagree. When, as here, the covered benefit had been previously determined in a mediated settlement of claimant's contract claim, the jury should not have been instructed to determine the amount of the covered benefit. Thus, the jury's answer to the fourth interrogatory can be ignored, and the remainder of the verdict is thereby reconciled.
¶ 59 The insurance company argues that the correct penalty under section 10-3-1116, when the claimant has already been compensated, is "an additional amount equal to the covered benefit that was unreasonably delayed in payment"; that is, the claimant cannot receive the covered benefit and also receive two times the amount of the benefit under section 10-3-116. We disagree.
¶ 60 Section 10-13-1116 "expressly creates a private right of action to obtain certain remedies" for the unreasonable delay or denial of benefits in violation of section 10-3-1115. Kisselman, 292 P.3d at 972 ("What [section 10-3-1116] does is increase the penalties on companies that unreasonably delay or deny payments by offering consumers in those situations.... a private right of action beyond the remedies in existing law." (quoting Hearing on H.B. 1407 Before the H. Comm. on Business Affairs & Labor, 66th Gen. Assemb., 2d Sess. (Apr. 24, 2008) (comments of Speaker Romanoff))).
¶ 61 Should an insured be successful in pursuing an action under this statute, it provides for a precise remedy: "reasonable attorney fees and court costs and two times the covered benefit." § 10-3-1116(1). That is exactly what the claimant sought and received here. We recognize that the claimant here will receive a total of three times the covered benefit; however, the awards arise
¶ 62 The claimant's ability to recover these amounts is supported by section 10-3-1116(4), which states that "[t]he action authorized in this section is in addition to, and does not limit or affect, other actions available by statute or common law, now or in the future. Damages awarded pursuant to this section shall not be recoverable in any other action or claim." § 10-3-1116(4) (emphasis added). See also Rabin v. Fidelity Nat'l Prop. & Cas. Ins. Co., 863 F.Supp.2d 1107, 1112 (D.Colo.2012). Rabin involves a scenario similar to that presented here in that the insurer paid most of the insured's fire losses prior to the action's commencement and the balance, based in its appraisers report, after the commencement of the action. The insurer there raised the same argument raised here, that is, the insured could only recover twice, not three times, the benefit. The court stated that section 10-3-1116 "explicitly contemplates and countenances that [a plaintiff] may simultaneously bring a breach of contract claim to recover certain benefits he was denied and a section 1116 claim for double those benefits if they were unreasonably denied." Rabin, 863 F.Supp.2d at 1112 (emphasis in original).
¶ 63 To accept the insurance company's interpretation here — that section 10-3-1116 prohibits the claimant from recovering two times the covered benefit when she has already been paid the benefit — requires us to read into the statute a restriction that is not contained in the statute and is contrary to the express language of the statute. Therefore, we conclude that the trial court did not err when it awarded the claimant $150,000 under section 10-3-1116.
¶ 64 The judgment is affirmed.
JUDGE DAILEY and JUDGE RICHMAN concur.
The amended model instruction is not before us and we express no opinion on it. We have quoted from the Colorado Jury Instructions — Civil (2013) published by Thomson Reuters Westlaw.
