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Giampara v. American Family Mutual Insurance Company2/24/2003
3, 17. By so holding, the majority perpetuates a rule that creates a particular type of tort liability in the context of traditional contract liability. Non-economic damages are available only if particular conduct occurs that is deemed wrongful. Thus, Colorado law imposes a tort duty to discourage contracting parties from intentionally breaching their contract. This rule in turn effectively elevates a breach of contract claim into an actionable tort claim. Such an approach undermines the goals and basic principles of contract law and unacceptably blurs the distinction between contract and tort.
This conflation of principles can be demonstrated by the majority's articulation of its own rule, particularly with respect to foreseeability. The majority holds that a plaintiff can recover for non-economic damages under the willful and wanton rule if such damages are a "foreseeable result of a breach at the time the contract was made." See maj. op. at 21 (citing to the Restatement (Second) of Contracts, §§ 351 & 352). As mentioned earlier, the majority also holds that such damages are recoverable so long as the damages are a "natural and probable result of the breach." See maj. op. at 3, 17. I find this articulation indistinguishable from a "natural and proximate result of the breach," which is the wording used and found in one of our original willful and wanton cases. See Westeson, 78 Colo. at 219, 240 P. at 690. The majority's two statements of foreseeability are not necessarily the same. As the Restatement tells us, foreseeability under contract law is a more severe limitation of liability than is the requirement of "proximate cause" -- an element that is normally found in a tort action. See Restatement (Second) of Contracts § 351 cmt. a. The Restatement explains that in contract, the recovery that is precluded by the limitation of foreseeability is usually based on the expectation interest -- i.e. lost profits -- but the limitation may also preclude recovery based on the reliance interest. Id. Thus, even the majority's reaffirmation of the willful and wanton rule fails to address the conflation between the law of contract and the law of tort inherent in the rule.
While I adhere fully to the principles of stare decisis and the policies that this important doctrine serves, I am convinced that our current rule of non-economic damages in contract cases should be set aside. See People v. Blehm, 983 P.2d 779, 788 (Colo. 1999)(" court will follow the rule of law it has established in earlier cases, unless clearly convinced that the rule was originally erroneous or is no longer sound because of changing conditions and that more good than harm will come from departing from precedent."). Sound reason exists in this case to depart from the rule that permits recovery of non-economic damages for a willful and wanton breach of contract. The rule, unsound at its inception, has become no more sound with the passage of time. See Evans v. Bd. of County Comm'rs, 174 Colo. 97, 104, 482 P.2d 968, 972 (1971) ("We think that the [two cases that created the rule that the court considered] were wrong when announced and they are wrong today; repetition of them forty times or four hundred times doesn't make good law or cause the reasons for the doctrines to become any stronger."). Hence, I would disapprove of the willful and wanton rule and overrule Hall and the line of cases that follow it.
III. A New Contract Rule of Strict Foreseeability for the Recovery of Non-economic Damages
Having concluded that the Colorado willful and wanton rule should be abandoned, I consider what rule should be implemented in its place. As discussed, the expectations of the parties at the time of contracting usually
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