 |
 |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|
|
|
|
Vaughan v. McMinn9/22/1997
EN BANC
JUSTICE BENDER delivered the Opinion of the Court.
CHIEF JUSTICE VOLLACK Dissents.
This proceeding under C.A.R. 50 is the consolidation of two lawsuits, each involving an insured who filed a common law tort claim against his insurance company for bad faith in handling the insured's workers' compensation claim. The insurance companies, the petitioners in this court, moved to dismiss for lack of subject matter jurisdiction. In both cases, the district court granted the motion, reasoning that the General Assembly's 1991 amendment to section 8-43-304(1), 3 C.R.S. (1997) of the Colorado Workers' Compensation Act (the Act) abrogated the common law tort of bad faith in the context of workers' compensation by providing the insured with an exclusive administrative mechanism to redress the insurance company's mishandling of its insured's claim. Both district courts concluded that the statutory remedy provided by section 8-43-304(1) divested district courts of jurisdiction over common law claims of bad faith mishandling of workers' compensation claims by their insurance company. The insured claimants appealed to the court of appeals. Before the resolution of that appeal, however, the insurance companies petitioned this court for immediate certiorari review under C.A.R. 50. We granted certiorari and consolidated the two actions for purposes of this proceeding.
The 1991 amendment to section 8-43-304(1) does not explicitly, or by necessary implication, preclude a private civil remedy for an insurer's mishandling of a workers' compensation claim. We hold that the 1991 amendment did not abrogate the common law tort of bad faith breach of an insurance contract in the context of a workers' compensation claim. This tort remains a viable cause of action in Colorado. We reverse the holding of both district courts and remand to the respective district courts for further proceedings consistent with this opinion.
I.
Respondents in this court, plaintiffs in the district court (the claimants), requested workers' compensation benefits after they allegedly sustained injuries during the course and scope of their employment. They subsequently sued their workers' compensation carriers, alleging, among other things, that the insurance companies failed to process their claims in a timely manner and failed to pay benefits to which they were entitled. The claimants proceeded on a common law tort theory for bad faith mishandling of an insurance claim, a cause of action that we held applicable in the workers' compensation context in Travelers Insurance Co. v. Savio, 706 P.2d 1258, 1271 (Colo. 1985).
The insurance companies moved to dismiss, arguing that this tort was no longer a valid cause of action. The insurance companies contended that the General Assembly's 1991 amendment to the Act abrogated the 1985 holding of Savio by creating an exclusive administrative remedy for bad faith claims, which divested district courts of jurisdiction over common law torts of bad faith. The district courts agreed that Savio was no longer controlling precedent and granted the insurance companies' motions to dismiss.
The claimants appealed and the insurance companies responded by petitioning this court for certiorari review under C.A.R. 50, to determine whether the 1991 amendment to section 8-43-304(1) abrogated the common law tort of bad faith in mishandling a workers' compensation claim which we set forth in Savio.
II.
Every insurance contract contains an implied covenant of good faith and fair dealing which imposes upon insurers a duty to act in good faith in their dealings with their insured. See Farmers Group, Inc.
Page 1 2 3 4 5 6 7 Colorado Personal Injury Attorneys
Personal Injury Lawyers
|
| |
to fill out a simple form to connect to Personal Injury Lawyers in your area.
|
|