Colorado High Court Says Injured Employee May Not Recover Via Co-Employee’s UM/UIM Policy
An injured employee is barred by operation of Colorado’s Workers’ Compensation Act’s exclusivity and co-employee immunity principles from bringing a UM/UIM benefits action against a co-employee vehicle owner’s insurer for damages stemming from a work-related accident caused by the negligent driving of another co-employee, held the state’s Supreme Court [Ryser v. Shelter Mut. Ins. Co., 2021 CO 11, 2021 Colo. LEXIS 102 (Feb. 16, 2021)]. Accordingly, a state trial court’s decision granting summary judgment to the co-employee’s UM/UIM insurer was appropriate under the facts of the case.
Background
Ryser and two of his co-workers, Forster and Babion, were returning together in Babion’s vehicle from a work trip. With Babion’s permission, Forster was driving, and and Ryser was a passenger in the back seat. During this trip, all three were acting within the course and scope of their employment. Forster fell asleep at the wheel and lost control of the vehicle, causing it to crash. As a result of the accident, Ryser suffered significant injuries.
Ryser received workers’ compensation benefits from his employer and uninsured motorist/underinsured motorist (“UM/UIM”) benefits from his own insurer. He sought additional UM/UIM benefits from Babion’s auto insurer, Shelter Mutual. Shelter denied Ryser’s claim, and Ryser filed a civil action against the insurer. Both parties filed motions for summary judgment.
Parties’ Contentions
Ryser contended that because Forster was immune under Colorado’s WCA for her tortious conduct while acting within the course and scope of her employment, she was effectively uninsured and therefore Ryser, as an insured under Babion’s Shelter policy, was entitled to seek UM/UIM benefits from Shelter. Shelter responded, however, that under the plain language of its policy and Colo. Rev. Stat. § 10-4-609(1)(a) and (4), it was required to pay UM/UIM benefits only when an insured is “legally entitled to recover” or “legally entitled to collect” from the owner or operator of the vehicle. Because the WCA rendered Forster immune from liability, Shelter contended that Ryser was not legally entitled to recover or collect from her.
Summary Judgment in Favor of Shelter Mutual
The trial court agreed with Shelter and granted its summary judgment motion. Ryser appealed, arguing that the phrases “legally entitled to recover” and “legally entitled to collect” required only that the insured be able to establish fault on the part of the uninsured motorist and the extent of the insured’s resulting damages. A division of the court of appeals ultimately affirmed the trial court’s grant of summary judgment.
Colorado Supreme Court’s Decision
The Supreme Court stressed the strength of the exclusive remedy rule in Colorado. Employers who comply with the provisions of the WCA are immune from common law liability related to work-related injuries. In addition, it is clear that in Colorado, the WCA exclusivity provisions extend to the injured worker’s co-employees, as long as the allegedly negligent act occurred in the course and scope of the co-employee’s employment. To allow otherwise, said the court, “would allow an end-run around the WCA’s exclusivity and co-employee immunity principles” [Opinion, ¶ 28].
The high court said it acknowledged the force of both Ryser’s and Shelter’s arguments regarding the proper interpretation of “legally entitled to recover” and “legally entitled to collect,” but stressed that it need not resolve that dispute here, because even if Ryser’s interpretation was correct and he could satisfy the facial requirements for recovering benefits under the Shelter policy and the UM/UIM statute, he still cannot prevail because allowing him to recover under the Shelter policy would directly conflict with the WCA’s exclusivity and co-employee immunity principles.
The Court concluded that the expansive wording of the WCA controlled in this case. Section 8-41-102 provided that “all causes of action, actions at law, suits in equity, proceedings, and statutory and common law rights and remedies for and on account of such …personal injury to [an] employee and accruing to any person are abolished except as provided in said articles.”
Comment
The Court’s decision is clearly in line with the majority of U.S. jurisdictions [see Larson’s Workers’ Compensation Law, § 110.05[10]]. One of the difficulties in these sorts of UM/UIM vehicle insurance cases is the tendency for parties, and even attorneys, to think in “tort” terms. That is to say, weren’t the UM/UIM provisions in this Shelter policy specifically designed to provide additional protection (and recovery) for an injured party like Ryser? The short answer is, “No.”
Consider the following hypothetical: An employee, “Able”, grew up in a “trust fund” environment. She listened to her parents tell her, time after time, that maintaining a strong liability insurance program was a necessity, if she wanted to protect her assets later in life. She studied hard, went to law school, and became a patent attorney, working for a large firm. Dutiful daughter, she purchased a multi-million-dollar liability policy to cover potential tort liability. This was in addition to the malpractice insurance the firm had secured.
Carelessly one day, she left her office waste basket in the aisle of her office and, as her administrative assistant walked around the young attorney’s desk, the assistant tripped over the partially-hidden basket, fell, and sustained a painful broken hip. Should the assistant be able to sue the patent attorney for the pain and suffering associated with the fall?
Most of us would quickly say, “Of course not!” Co-employee immunity prevents that sort of tort action. The assistant would be entitled to workers’ compensation benefits, but no more. The fact that the patent attorney has a liability policy to indemnify her for her tortious actions makes no difference. The injured assistant doesn’t have additional rights because the tortfeasor has purchased insurance to protect against loss.
The same rule follows in these UM/UIM auto policy cases.