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Cyprus Amax Minerals Company v. Lexington Insurance Company6/16/2003
JUDGMENT REVERSED AND REMANDED WITH DIRECTIONS
EN BANC
I. Introduction
This is a case in which an insured is seeking indemnification from its insurers. The insured, Cyprus Amax Minerals Company ("Cyprus"), sold the Golden Cross Mine to Coeur d'Alene Mines Corporation ("Coeur"). Two years after the sale, the Mine experienced substantial damage, eventually leading to its close, stemming from a landslide deep below ground. After years of litigation, Cyprus and Coeur settled their claims and Cyprus sought indemnification from its insurers. The insurers refused, and Cyprus sued. The trial court granted summary judgment in favor of the insurers and the court of appeals affirmed. Cyprus Amax Minerals Co. v. Lexington Ins. Co., 55 P.3d 200 (Colo. App. 2002). We granted certiorari on three issues, relating both generally and specifically to the insurers' indemnification obligation.
We now hold as follows. First, we explore the difference between an insurer's duty to defend its insured and an insurer's duty to indemnify its insured. We note that the rule directing a trial court to examine the underlying complaint in order to determine whether the insurer has a duty to defend its insured against the claims asserted is a rule designed to cast a broad net in favor of coverage. To interpret that rule in a way that narrows coverage when applied to a duty to indemnify would be inconsistent with our precedent. Accordingly, we hold that in determining the possibility of indemnity coverage, the trial court must examine the nature of the facts alleged and claims pled in the complaint or amended complaint liberally with a view toward affording the greatest possible protection to the insured. If, when read liberally, such document can colorably support a conclusion that coverage may attach, then the court may consider such additional evidence as will buttress or defeat coverage. Second, we hold that "property damage" was at issue in the lawsuit between Coeur and Cyprus, because "property damage" under the language of these policies can include the costs of repairing the Mine and the costs incurred by Coeur in loss of use of the Mine after the landslide. Third, we hold that the landslide was a "loss" or "accident" that could trigger the possibility of coverage under the terms of these policies and that no further causal connection was required by the policies.
We therefore conclude that there are genuine issues of material fact in dispute. Accordingly, we overturn the entry of summary judgment and remand this case for resolution of the factual issue of whether some portion of the settlement amount is compensable property damage attributable to physical injury to or destruction of the Mine including the loss of use of the Mine arising out of the landslide.
II. Facts and Procedural History
In April of 1993, Cyprus sold the Golden Cross Mine in Auckland, New Zealand to Coeur through a stock purchase agreement for nearly $54 million. Coeur operated the Mine successfully for almost two years, until the Mine experienced significant damage as a result of deep-seated ground movement. Coeur made efforts to repair the damage caused by the subsidence at the Mine, but eventually closed the Mine.
In 1996, litigation ensued between the parties, centering on the damaged Mine. Cyprus initiated suit by filing a declaratory judgment action against Coeur in Federal District Court in Colorado. Shortly thereafter, Coeur filed an action in its home state of Idaho (the "underlying litigation"). In its Second Amended Complaint, Coeur alleged that Cyprus negligently, recklessly, or deliberately failed to disclose material facts regarding conditions at th
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