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Copper Mountain Inc. v. Poma of America Inc.2/6/1995
iding the issue of good faith without permitting further discovery or testimony on the contribution claim. Id. at 986.
We affirm the judgment of the court of appeals and conclude that for purposes of section 13-50.5-105, a settlement is reached in "good faith" in the absence of collusive conduct. Because of our resolution of the first issue for which we granted certiorari, we decline to address the remaining issues.
II
A
Initially we examine the court of appeals' determination as to whom section 13-50.5-105's duty extends. Section 13-50.5-105 provides as follows:
Release or covenant not to sue. (1) When a release or a covenant not to sue or not to enforce judgment is given in good faith to one of two or more persons liable in tort for the same injury or the same wrongful death:
(a) It does not discharge any of the other tortfeasors from liability for their several pro rata shares of liability for the injury , death, damage, or loss unless its terms so provide; but it reduces the aggregate claim against the others to the extent of any degree or percentage of fault or negligence attributable by the finder of fact, pursuant to section 13-21-111(2) or (3) or section 13-21-111.5, to the tortfeasor to whom the release or covenant is given; and
(b) It discharges the tortfeasor to whom it is given from all liability for contribution to any other tortfeasor. § 13-50.5-105, 6A C.R.S. (1987). Our statutory provision includes a verbatim enactment of section 4(b) of the Uniform Contribution Among Tortfeasors Act of 1955, 12 U.L.A. 63 (1975) ("UCATA"), the comment to which posits that "the requirement that the release or covenant be given in good faith gives the court occasion to determine whether the transaction was collusive, and if so there is no discharge." UCATA § 4 (1975) (Commissioner's Comment to subsection (b)). This interpretation by the drafters of the UCATA indicates an intent that the good faith obligation extend to the nonsettling defendant -- the only party that could be the victim of such collusion. See, e.g., Owen v. United States, 713 F.2d 1461, 1464 (9th Cir. 1983) (applying California's statutory bar to contribution claims only if settling parties acted in good faith with respect to nonsettling defendant); Commercial Union Ins. Co. v. Ford Motor Co., 640 F.2d 210, 213 (9th Cir.) (same), cert. denied, 454 U.S. 858, 70 L. Ed. 2d 154, 102 S. Ct. 310 (1981); In re MGM Grand Hotel Fire Litigation, 570 F. Supp. 913, 927 (D. Nev. 1983) (good faith requirement imposed to protect the nonsettling defendant) (applying Nevada statute with language identical to section 13-50.5-105(1)(b)). Additionally, we adopt the reasoning of the court of appeals that "because in every contract there is an implied obligation of good faith and fair dealing, construing the duty as applying only to the settling parties would render the language of the statute superfluous." Stubbs, 862 P.2d at 981 (citing River Garden Farms, Inc. v. Superior Court, 26 Cal. App. 3d 986, 103 Cal. Rptr. 498 (Cal. App. 1972)). Thus, we agree with the court of appeals' determination that the duty of good faith extends to nonsettling tortfeasors, as well as to those persons who are a party to the settlement agreement.
B
We next turn to a matter which is truly at the heart of this dispute -- what constitutes "good faith" under section 13-50.5-105(1). Copper contends that the court of appeals erred by not adopting the test for good faith first articulated by the C
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