In a current determination that explains what policyholders should show to prevail on a statutory unhealthy religion declare in Colorado, the Tenth Circuit Courtroom of Appeals affirmed abstract judgment in favor of Mid-Century Insurance coverage Firm in El Dueno, LLC v. Mid-Century Insurance coverage Firm. 1 The ruling is a transparent reminder that below Colorado legislation, an insurer’s reliance on a professional, unbiased skilled, absent opposite proof, can function an affordable foundation for a declare determination and defeat allegations of unhealthy religion.
The dispute started when El Dueno, the proprietor of a industrial property in Greeley, Colorado, submitted a hail harm declare following a July 2018 storm. Initially, Mid-Century’s adjuster, Maggie Fields, inspected the property and located indicators of hail harm, main the insurer to subject a fee. Nevertheless, El Dueno later submitted a revised estimate exceeding $340,000. This was considerably greater than the preliminary scope of harm by Mid-Century.
Mid-Century reassigned the file to a large-loss adjuster, who in flip retained Rimkus Engineering to evaluate the roof. Rimkus engineer William Templeton performed an inspection and concluded that the roof harm was not brought on by hail however relatively as a result of put on, tear, and different non-covered causes. Mid-Century relied on this report in denying additional fee on the roof portion of the declare, whereas nonetheless issuing a further fee for hail harm to HVAC models as recognized by a separate vendor.
El Dueno filed swimsuit alleging unhealthy religion below Colorado Revised Statutes Sections 10-3-1115 and 10-3-1116. Mid-Century moved for abstract judgment. The federal district courtroom granted the movement, holding that the insurer’s reliance on a professional engineering report, unrebutted by any proof of industry-standard violations, was cheap as a matter of legislation. On attraction, the Tenth Circuit agreed.
The appellate courtroom emphasised that below Colorado legislation, an insurer’s conduct should be evaluated primarily based on whether or not it had an affordable foundation for its declare determination and whether or not it violated any relevant {industry} requirements. Importantly, the courtroom famous that El Dueno didn’t present a competing engineering opinion on the time of Mid-Century’s protection determination. It by no means took the deposition of Mr. Templeton, the insurer’s roofing skilled, and did not submit any skilled testimony that Mid-Century’s claims dealing with fell beneath {industry} requirements. Whereas El Dueno ultimately, throughout litigation, retained former adjuster Kerry Freeman as an skilled, Freeman was not an engineer, didn’t deal with whether or not Templeton’s report violated any engineering requirements, and provided no opinion on whether or not Mid-Century acted in unhealthy religion.
In affirming abstract judgment, the Tenth Circuit reiterated that mere disagreement with an insurer’s conclusions or skilled opinions is inadequate to show unhealthy religion. With out proof that Mid-Century ignored related information, failed to analyze totally, or acted opposite to established norms, the courtroom discovered no triable subject of fabric reality. The courtroom underscored that policyholders bear the burden of articulating and proving how an insurer’s conduct deviated from acceptable requirements, particularly when counting on the findings of unbiased professionals.
The ruling sends a transparent sign to policyholders and their counsel that difficult an insurer’s denial primarily based on a third-party skilled report requires greater than merely disputing the result. To succeed on a foul religion declare in Colorado, claimants should be ready to supply well timed, substantive proof, which is ideally within the type of skilled testimony demonstrating that the insurer’s reliance on its skilled was not solely incorrect, however unreasonable below relevant requirements. With out such a exhibiting, courts are prone to proceed rejecting unhealthy religion allegations on the abstract judgment stage.
Thought For The Day
“Get your information first, then you possibly can distort them as you please.”
—Mark Twain
1 El Dueno v. Mid-Century ins. What.No. 24-1110, 2025 WL 1540329 (10th Cir. Might 30, 2025) (The appellate briefs by El Dueno and Mid-Century submitted to the Tenth Circuit are additionally connected)
