Opinion
Civil Action No. 04-cv-00223-RPM.
May 25, 2006
ORDER FOR ENTRY OF JUDGMENT
On April 10, 2006, the court entered summary judgment in favor of plaintiff West American Insurance Company ("WAIC"), and ordered the plaintiff to submit a statement of amounts claimed to be due it on its prayer for relief. On April 21, 2006, WAIC submitted its statement, claiming the following amounts:
(1) $475,000.00 for the amount WAIC contributed to the settlement of the LaPlatt lawsuit;
(2) $133,895.35 for prejudgment interest pursuant to C.R.S. § 5-12-102, accruing on the principal amount of $475,000.00, at the rate of 8 % per annum, compounded annually, from the date of the settlement of the LaPlatt lawsuit (January 20, 2003) through the date of this court's order granting summary judgment in favor of WAIC;
(3) $49,719.41 for attorney/paralegal fees and costs, including expert witness fees, that WAIC incurred in defending Flat Coat Asphalt Specialists, LLC in the LaPlatt lawsuit, and
(4) $14,024.05 for prejudgment interest on the attorneys' fees and costs.
Defendant Westport Insurance Company ("Westport") opposed WAIC's statement of amounts claimed to be due, arguing that the terms of its policy to Dennis J. Beaman (the "Westport/Beaman policy") limit its liability in this action to $475,000.00, and that it has no obligation to pay Flat Coat's litigation expenses.
WAIC's claim for prejudgment interest is based on C.R.S. § 5-12-102, which governs prejudgment interest on damages from the date of wrongful withholding. WAIC brought this action to enforce Westport's obligation to provide primary insurance coverage. WAIC's claim for prejudgment interest does not arise under C.R.S. § 13-21-101, and does not originate from the personal injury damages claimed in the LaPlatt lawsuit. An award of prejudgment interest in excess of Westport's policy limits is appropriate in this action. See Peterman v. State Farm Mut. Auto. Ins. Co., 8 P.3d 549, 551 (Colo.App. 2000).
WAIC is not entitled to reimbursement of the attorneys' fees and costs it incurred in defending Flat Coat in the LaPlatt lawsuit. When multiple insurers are obligated to defend an insured and one insurer funds the defense, principles of contribution or subrogation may be employed to apportion or reallocate the insured's litigation expenses among those insurers who had a duty to defend. Those principles do not apply here. WAIC has not identified any language in the Westport/Beaman policy that would impose an obligation on Westport to defend Flat Coat. The plaintiffs in the LaPlatt lawsuit alleged negligence on the part of Beaman and Flat Coat. Westport defended the LaPlatt lawsuit on behalf of Beaman, and WAIC provided the defense of its insured, Flat Coat. The fees and costs that WAIC incurred defending Flat Coat were its own obligation, resulting from WAIC's contractual duty to defend its insured.
Accordingly, it is
ORDERED that judgment shall enter in favor of the plaintiff in the principal amount of $475,000.00, and prejudgment interest from January 20, 2003 through April 11, 2006 in the amount of $133,895.35, and from April 12, 2006 until the date of judgment at the rate of $131.15 per day.