FEBRUARY 2012

INSIDE CASE LAW UPDATE; CO. Supreme Court & Court of Appeals

T H E C D L A

pdateUTHE CDLA NEWSLET TERHIGHLIGHTING IMPORTANT ISSUES FACING TODAYS DEFENSE ATTORNEYS

QUICK LINKS;

In Re Marriage of Brandt

Farm Deals v. CO. Dept. of Rev.

Roque v. Allstate Insurance Co.

Rea V. Corrections Corp. of America

Vaccaro v. American Family

TW Telecom V. Carolina Internet LTD

AnnouncementThe US District Court announced that commencing February 23, 2012

attorneys will be required to open civil cases in the District of Colorado via ECF and provide payment via pay.gov. Other changes that will occur (some before February 23) include:

• The clerk’s office will no longer return your filed complaint via email. You will receive a Notice of Electronic Filing (NEF) when your case is opened.• Summons forms, if provided, will be issued through ECF. You will receive a NEF with the summons and the magistrate consent form. A new event has been created for filing the civil summons called “Summons Request.” Please note you should use the national summons form (http://www.cod.uscourts.gov/ Forms.aspx), not the local form.• The fee for filing an appeal may be paid on-line at the time of filing.• A new event has been created for filing the corporate disclosure statement and entering corporate parents in CM/ECF.

More Information and Instructions for opening a new case will be posted at:http://www.cod.uscourts.gov/CMECF/CMECF.aspxTraining for attorneys and staff: http://www.cod.uscourts.gov/CMECF/CMECF_TrnReg.aspx.The ECF Help Desk can be reached at: 866.365.6381 or 303.335.2050

C ASE L AW:

COLOR ADO SUPREME COURT

IN RE MARRIAGE OF BRANDTSupreme Court interprets “presently resides” term in Child Custody Act (SC 01/23/12) The Uniform Child Custody Jurisdiction and Enforcement Act provides that the issuing state has exclusive continuing jurisdiction over its child custody until it, or another state, makes a determination that the child and the child’s parents do not “presently reside” in the issuing state. The Supreme Court held that the statutory term “presently reside” is not equivalent to “currently reside” or “physical presence,” the two notions on which the trial court based its order assuming juris-diction to modify Maryland’s child custody decree. Instead, it held that a court’s determination should be based on an inquiry into the totality of the circumstances that make up a person’s permanent home—“domicile”—to which he or she intends to return to and remain and goes on to enumerate a laundry list of factors. l

COURT OF APPEALS

FARM DEALS, LLLP V. COLORADODEP’T OF REVENUE(CA 01/05/12). Petitioners filed an appeal in the trial court challenging determinations by the Colorado De-partment of Revenue denying income tax credits for conservation easements during the 2003 tax year. Pe-titioners filed a motion requesting certification of the order for an interlocutory appeal under CRS § 13-4-102.1. Respondents opposed on numerous grounds, including that it was not filed with fourteen days of the Order being appealed from the date of the Order being appealed, as required by C.A.R. 4.2(c). [C.A.R. 4.2 was promulgated by the Colorado Supreme Court

to establish procedures for applying the interlocutory appeals statute, § 13-4-102.1]. Though the trial court certified the Order, it, too, was not filed within the deadline for filing with the court of appeals [fourteen days after the date of the certification]. The Court of Appeals found that the trial court had no authority to extend the fourteen-day deadline for filing a motion for certification of its Order. The Court also concluded that petitioners failed to establish good cause for their failure to meet the jurisdictional deadline of C.A.R. 4.2(d). While C.A.R. 26(b) authorizes extending the deadline for good cause due to excusable neglect, the Court held the justification for late filing here demon-strated carelessness, not excusable neglect. l

COURT OF APPEALS cont.

ROQUE V. ALLSTATE INSURANCE CO.Court of Appeals finds “road rage” incident does not trigger UM coverage (CA 01/09/12). Plaintiffs, in one car, and Richard Terlingen, in his car, ex-changed verbal hostilities while driving next to each other. When plain-tiffs turned into a McDonald’s parking lot, Terlingen followed. He parked directly behind plaintiffs’ car, preventing them from leaving the parking lot. After all three of them exited their vehicles, Terlingen pulled a golf club from the trunk of his car and struck plaintiffs with it, causing injuries. Terlingen had home, umbrella, and automobile insurance policies with American Family Mutual Insurance Company, which obtained a declara-tory judgment in federal court that it was not required to cover Terlingen for the injuries that he had intentionally caused. The trial court then found that the uninsured motorist coverage in the Allstate policy covering the plaintiffs’ vehicle did not cover the injuries that Terlingen had intention-ally caused. On appeal, plaintiffs argued that their injuries arose out of Terlingen’s use of his vehicle because, but for the road rage incident, the altercation would not have occurred, and by parking closely behind them to prevent them from driving out of the parking lot, Terlingen used his vehicle to facilitate the assault. Allstate’s policy covers damages caused by the owner or operator of an uninsured vehicle “aris[ing] out of the owner-ship, maintenance, or use of an uninsured auto.” Here, exiting the car and then engaging in intentional misconduct broke the requisite causal chain between use of the vehicle and the injuries. Accordingly, because plain-tiffs’ injuries did not result from use of a vehicle, they were not entitled to UM coverage. l

REA V. CORRECTIONS CORPORATION OF AMERICADismissal of inmate’s suit affirmed by Court of Appeals (CA 01/09/12). CCA operates a private prison under con-tract with the Colorado Department of Corrections. According to Rea’s allegations, a CCA sergeant searched his cell, seized documents about the unsolved murder of Jon Benet Ramsey, and started a rumor that Rea was involved in that murder. Rea instituted the present action, alleging claims of defamation, failure to provide pro-tection, discrimination, and tampering with legal mail and witnesses against CCA, the sergeant, and a CCA case manager. The sergeant and the CCA case manager were never served with process in this matter, and the district court dismissed the claims against CCA. The Court of Appeals first concluded sua sponte that named but unserved defendants are not litigants for purposes of determining the appealability of an order under the final judgment rule. Rea alleged that, instead of dismissing the case against CCA, the court should have granted him a default judgment against CCA. However, CCA filed a motion for extension of time to file a responsive pleading in state court and timely filed an answer in federal court, which continued with the case after it was remanded to state court. Therefore, Rea was not entitled to a default judgment. Finally, Rea asserted that the judgment should be reversed because the district court was biased and prejudiced against him. However, Rea waived any appearance of impropriety because he did not seek to disqualify the judge in the district court, and Rea did not allege any facts to support a claim of actual bias. l

VACCARO V. AMERICAN FAMILYINSURANCE GROUP.Court of appeals finds “double damage” statue can ap-ply to claims arising before statute’s enactment (CA 01/09/12). A negligent tortfeasor injured plaintiff in a two-car accident in 2005. The tortfeasor had liability insurance with policy limits of $25,000. Defendant’s policy insuring plaintiff provided UIM coverage up to $100,000. Plaintiff settled his claim against the at-fault driver for the policy limit of $25,000. After de-fendant received plaintiff ’s IME report on September 22, 2008, which opined that extensive medical treat-ment was necessary and causally related to the acci-dent, defendant denied plaintiff ’s claim for $75,000 in UIM benefits. On appeal, defendant asserted that the trial court’s submission of plaintiff ’s statutory claim to the jury was an unconstitutional retroactive applica-tion of the statutes. The statutes, which took effect on August 5, 2008, create a right of action separate from the common law tort of bad faith breach of an insur-ance contract. The COA held that although the stat-utes may not operate retroactively, they may properly apply to new acts of unreasonable denial or delay oc-

curring after their effective date, even where the un-derlying insurance claim arose before their enactment. Here, a reasonable jury could find that defendant en-gaged in new acts of unreasonable denial and delay af-ter August 5, 2008, sufficient to impose liability under the statutes. Defendant also contended that there was insufficient evidence of unreasonableness to support plaintiff ’s statutory claim. Plaintiff provided evidence at trial beyond a merely subjective opinion on whether defendant acted reasonably, particularly that defendant requested—and then ignored—the IME report. It said that a reasonable jury could have found that defendant refused to consider evidence showing plaintiff was en-titled to additional compensation. Defendant further contended that the trial court erroneously ordered it to pay an additional $40,539 in prejudgment interest because the jury awarded plaintiff the policy limit of $75,000 in contract damages. Because it is part of the compensation awarded for bodily injury, prejudgment interest is within the bodily injury coverage of an in-surance policy and is subject to those policy limits. Therefore, defendant was not liable for prejudgment interest beyond the $75,000 awarded on plaintiff ’s con-tract claim. l

TW TELECOM HOLDINGS INC. V.CAROLINA INTERNET LTD.TW Telecom Holdings Inc. v. Carolina Internet Ltd. Tenth Circuit overrules precedent and applies auto-matic stay to appeals. (10th Cir. 11/15/2011) (D.Colo.) (Gorsuch). Defendant appealed a judgment against it entered in favor of plaintiff. While the appeal was pending, defendant filed for Chapter 11 bankruptcy

protection. Prior precedent held that an appeal taken by a bankruptcy debtor is not subject to the automatic stay in bankruptcy. Joining several other circuit courts holding to the contrary, the Tenth Circuit overruled its precedent and announced that from this date for-ward, the automatic stay applies to stay all appeals in proceedings that were originally brought against the debtor, regardless of whether the debtor is the appel-lant or appellee. l

COURT OF APPEALS cont.

10th CIRCUIT COURT OF APPEALS cont.

CDLA DIRECTORSBrendan O. Powers, Esq.PresidentSpies, Powers & Robinson

Teresa W. Seymour, Esq.Vice PresidentJones, Waters, Geislinger & Seymour

Dawn R. Kubik, Esq.Treasurer2012 Conference ChairJones, Waters, Geislinger & Seymour

Rob Jones, Esq.Secretary2013 Conference ChairPaul Edwards & Associates

Jeffrey C. Ruebel, Esq.Ex-OfficioRuebel & Quillen

Caitlin S. Quander, Esq.Legislative DirectorHarris, Karstaedt, Jamison & Powers

John R. Chase, Esq.At-Large DirectorTrial Academy ChairMontgomery, Kolodny, Amatuzio & Dusbabek

David M. McLain, Esq.At-Large DirectorHiggins, Hopkins, McLain & Roswell, LLC

Jody Haskins, Esq.Young Lawyer Co-ChairWhite & Steele

Jeff Garcia, Esq.Young Lawyer Co-ChairDiversity ChairPatterson Nuss & Seymour

Heather A. Salg, Esq.Ex-Officio /Communications DirectorHarris, Karstaedt, Jamison & Powers

Bo Donegan, CPAExecutive Director5761 South Elm StGreenwood Village, Co 80121303-263-6466