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Warwick v. State Farm Mutual Automobile Insurance Co.11/17/1994
Plaintiff, Rebecca Warwick, initiated this action against defendant, State Farm Mutual Automobile Insurance Company, asserting various causes of action, including claims brought pursuant to § 10-4-708, C.R.S. (1994 Cum. Supp.), for breach of contract and willful and wanton failure to pay personal injury protection benefits in accordance with § 10-4-701, et seq., C.R.S. (1987 Repl. Vol. 4A)(the No-Fault Act). From a judgment of dismissal of these claims, Warwick appeals, and we affirm.
Warwick contends that the trial court erred in dismissing these claims based on its Conclusion that such claims were required to be arbitrated under the terms of § 10-4-708 in effect at the time plaintiff's policy was issued. Warwick asserts that the 1991 amendments to the No-Fault Act, modifying the requirement that such claims be arbitrated, are applicable to her action because, she argues, the acts "complained of" occurred after the effective date of the amendments. We disagree.
The pertinent facts in this case are not in dispute. Warwick was injured in an automobile accident on May 12, 1991. At the time of her accident, she was insured with an automobile policy issued by State Farm which provided personal injury protection (PIP) benefits as required by the No-Fault Act. Her automobile insurance policy was issued prior to July 1, 1991. She submitted claims to State Farm for her health care expenses, which it allegedly failed to pay in a timely manner or improperly denied after July 1, 1991.
The No-Fault Act governs the rights and liabilities for personal injuries resulting from automobile accidents. PIP coverage is required by the No-Fault Act and PIP benefits are required to be paid regardless of fault. Tate v. Industrial Claim Appeals Office, 815 P.2d 15 (Colo. 1991).
Prior to amendment of the No-Fault Act in 1991, Colo. Sess. Laws 1989, ch. 82, § 10-4-708(1.5) at 458-459 provided, in pertinent part, that any "action for breach of contract brought pursuant to subsection (1) of this section shall proceed to binding arbitration . . . ." (emphasis added) That statutory section now provides:
If a dispute arises under subsection (1) of this section, the insured . . . and the insurer may agree to resolve the dispute through binding arbitration. . . .
If there is no agreement concerning binding arbitration, the insured . . . may bring an action in contract in the appropriate court to resolve the dispute. Section 10-4-708(1.5), C.R.S. (1994 Cum. Supp.).
Thus, if the provisions of § 10-4-708 in effect prior to the 1991 amendments are applicable to Warwick, she was required to resolve her claims under the No-Fault Act through mandatory arbitration. Alternatively, if the 1991 amendments govern her action, she is entitled to elect resolution through binding arbitration, if the parties can so agree, or through a contract action in court.
The enacting provision of the 1991 amendments states:
This act shall take effect July 1, 1991, and shall apply to services provided under and disputes related to policies issued on or after July 1, 1991, complying with the provisions of the [No-Fault Act], and to acts occurring on or after said date. Colo. Sess. Laws 1991, ch. 203, § 6 at 1191.
Warwick contends that this provision should be interpreted so that the 1991 amendments are applicable to insurance policies issued after July 1, 1991, or to acts occurring on or after that date, regardless of when the policy was issued. Relying on the phrase "and to acts occurring on or af
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