Ins. v. Dakota Station II

The summaries of the Colorado Court of Appeals published opinions
constitute no part of the opinion of the division but have been prepared by
the division for the convenience of the reader. The summaries may not be
cited or relied upon as they are not the official language of the division.
Any discrepancy between the language in the summary and in the opinion
should be resolved in favor of the language in the opinion.
SUMMARY
August 26, 2021
2021COA114
No. 20CA254, Owners Ins. v Dakota Station II — Insurance;
Arbitration — Colorado Uniform Arbitration Act — Vacating
Award — Appraisers — Impartiality
A division of the court of appeals considers a novel issue of
state law: Where an insurance policy’s appraisal provision requires
the agreement of at least one impartial appraiser for an award to be
binding, does the lack of impartiality by the only appraiser to agree
to the award invalidate the award? The division concludes that it
does. The division also concludes that the trial court didn’t violate
the law of the case in addressing the issues remanded from a prior
appeal, didn’t reversibly err in any of the rulings challenged on
appeal, applied the correct legal standards in its decision, and made
factual findings regarding an appraiser’s impartiality that are
supported by the record. The summaries of the Colorado Court of
Appeals published opinions constitute no part of the opinion of the
division but have been prepared by the division for the convenience
of the reader. The summaries may not be cited or relied upon as
they are not the official language of the division. Any discrepancy
between the language in the summary and in the opinion should be
resolved in favor of the language in the opinion.
Accordingly, the division affirms the trial court’s judgment
vacating an umpire’s appraisal award.
COLORADO COURT OF APPEALS 2021COA114
Court of Appeals No. 20CA0254
Jefferson County District Court No. 15CV31037
Honorable Laura A. Tighe, Judge
Owners Insurance Company, a Michigan corporation,
Petitioner-Appellee,
v.
Dakota Station II Condominium Association, Inc., a Colorado nonprofit
corporation,
Respondent-Appellant.
JUDGMENT AFFIRMED
Division III
Opinion by JUDGE GOMEZ
Furman and Tow, JJ., concur
Announced August 26, 2021
Spencer Fane LLP, Terence M. Ridley, Evan B. Stephenson, Kayla L. Scroggins-
Uptigrove, Denver, Colorado; Wheeler Law P.C., Karen H. Wheeler, Greenwood
Village, Colorado, for Petitioner-Appellee
Orten Cavanaugh Holmes & Hunt, LLC, Jonah G. Hunt, Joseph A. Bucceri,
Denver, Colorado, for Respondent-Appellant
¶1 This is the second appeal to this court in an insurance dispute
between Owners Insurance Company (Owners) and Dakota Station
II Condominium Association, Inc. (Dakota). This appeal requires us
to address a novel issue of state law: Where an insurance policy’s
appraisal provision requires the agreement of at least one impartial
appraiser for an award to be binding, does the lack of impartiality
by the only appraiser to agree to the award invalidate the award?
Because we conclude that it does and because the trial court
properly determined that the only appraiser who agreed to the
appraisal award was not impartial, we affirm the trial court’s
judgment vacating the award.
I. Background
¶2 Dakota, which represents the owners of a forty-nine-building
residential property, filed two claims with its insurer, Owners, after
the property sustained storm damage. When the parties couldn’t
agree on the amount of the damage, Dakota invoked the appraisal
provision in the insurance policy.
¶3 That provision reads, in relevant part, as follows:
If [Owners] and [Dakota] disagree on the value
of the property or the amount of loss, either
may make written demand for an appraisal of
1
the loss. In this event, each party will select a
competent and impartial appraiser. The two
appraisers will select an umpire. If they
cannot agree, either may request that selection
be made by a judge of a court having
jurisdiction. The appraisers will state
separately the value of the property and
amount of loss. If they fail to agree, they will
submit their differences to the umpire. A
decision agreed to by any two will be binding.
¶4 Dakota hired Scott Benglen to serve as its public adjuster to
handle the claims. Benglen, who was working on a contingency
basis and thus had a financial interest in the claims’ outcome,
retained Laura Haber initially as a policy and damage expert and
later as Dakota’s appraiser. Haber’s contract included a fee cap
provision that would limit her fees, incurred on an hourly basis, to
“5% of the total replacement cost value.” The contract included
lines for the parties to initial that term but no one did so.
¶5 In accordance with the appraisal procedure, the parties’
respective appraisers submitted their estimates and the umpire
issued an award adopting some estimates from each appraiser. The
umpire adopted Owners’ appraiser’s estimates in four contested
categories and adopted Haber’s estimates in the other two,
including the largest contested category of roof repair, for a total
2
award of about $3 million. The umpire and Haber both signed
agreeing to the award, and Owners paid it.
¶6 Owners later filed a motion to vacate the appraisal award
under section 13-22-223, C.R.S. 2020, of the Colorado Uniform
Arbitration Act (CUAA), alleging, among other things, that Haber
wasn’t impartial, as required by the policy.
¶7 The trial judge conducted an evidentiary hearing and then
issued oral findings and conclusions denying the motion. He
retired shortly thereafter, and another judge reduced the oral
rulings to writing. In those rulings, the court determined that
appraisers aren’t subject to the same impartiality requirements as
umpires or arbiters but, instead, are expected to base their
decisions on their experience and investigation (much like expert
witnesses) and not let their findings be influenced by the side for
whom they work. The court found that, under this standard, Haber
hadn’t acted improperly on any of the grounds asserted by Owners,
including that she allegedly (1) visited the property and met with
Benglen and Dakota’s board of directors before being appointed as
the appraiser; (2) had a partnership relationship with Benglen;
(3) failed to disclose roof damage that had occurred before the policy
3
period; (4) included in her estimate damage that had occurred after
the policy period, when Dakota was no longer insured by Owners;
and (5) operated under a contract capping her fee at 5% of the
appraisal award.
¶8 As to the last issue regarding the fee cap, the court found that
neither party thought the cap applied to this case; the fee would’ve
been under 2% of the award no matter which figures the umpire
adopted, so the cap “didn’t come into play”; if it had come into play,
the court likely would’ve enforced it notwithstanding the parties’
failure to initial that provision; and a fee cap contract doesn’t itself
establish bias as a matter of law.
¶9 A split division of this court affirmed. Owners Ins. Co. v.
Dakota Station II Condo. Ass’n, 2017 COA 103 (Owners Ins. I). The
majority largely agreed with the impartiality standard employed by
the trial court but concluded that an appraiser can favor one side
more than the other. Id. at ¶¶ 20-26. Applying this standard, it
affirmed all of the trial court’s findings. Id. at ¶¶ 27-69. In a partial
dissent, Judge Terry wrote that she would employ an impartiality
standard precluding appraisers from advocating for the party who
selects them, would reverse and remand for further findings on
4
whether Haber was impartial under that standard, and would direct
that “[i]f [Haber] lacked the requisite impartiality, the damages
award should be vacated.” Id. at ¶¶ 77, 82 (Terry, J., concurring in
part and dissenting in part).
¶ 10 The supreme court reversed, concluding that the division
majority had employed the wrong standard of impartiality. Owners
Ins. Co. v. Dakota Station II Condo. Ass’n, 2019 CO 65, ¶¶ 38-44
(Owners Ins. II). In doing so, the court established the applicable
standard for appraiser impartiality: the policy language “requires
the appraiser to be unbiased, disinterested, without prejudice, and
unswayed by personal interest” and to “not favor one side more
than the other.” Id. at ¶ 44. It also offered guidance on the
distinction between advocating for a party (which is not allowed)
and advocating for the appraiser’s position (which is):
An appraiser can certainly explain her position
without running afoul of the provision’s
impartiality requirement. An appraiser may,
for example, defend her choice of methodology
or use of certain data. Conversely, an
appraiser may explain why she feels another
appraiser’s methodology or use of data is
wrong. In neither instance would the
appraiser necessarily be acting as an advocate
on behalf of a party to the dispute. An
appraiser advocates for or on behalf of a party
5
when her actions are motivated by a desire to
benefit a party. For example, if an appraiser
simply seeks top dollar for a client, that is
improper. In contrast, explaining a position or
defending a choice in methodology can be
motivated by a desire to reach an accurate
outcome.
Id. at ¶ 44 n.5. The supreme court remanded the case for the trial
court to “determine whether Dakota’s appraiser’s conduct
conformed to [this] standard.” Id. at ¶ 44.
¶ 11 The supreme court also considered the significance of the fee
cap. The court agreed with the division majority’s statement that
“we see no basis for concluding that [the appraiser]’s impartiality
was compromised by this [5%] fee cap when [5%] of the final
appraisal was far in excess of the actual billed fees and the contract
provision was not invoked.” Id. at ¶ 48 (quoting Owners Ins. I,
¶ 55). The court added that, “[i]n such a case, where the appraiser
didn’t believe the cap was in effect and there is seemingly no
relationship between the fees billed by the appraiser and the
estimates she put forth, we can’t say that hypothetical incentives
rendered her partial.” Id. Thus, the court concluded, “while we are
wary of the possible incentives these agreements create, we decline
to hold that they render appraisers partial as a matter of law.” Id.
6
¶ 12 The case then returned to the trial judge who had reduced the
initial oral ruling to writing, and the judge set the matter for a new
evidentiary hearing. But the parties couldn’t agree on the scope of
the remand — in particular, whether another evidentiary hearing
was warranted, what evidence was relevant in such a hearing, and
the extent to which the court could reconsider the earlier findings.
Dakota argued that no hearing was warranted, filed motions to
exclude some of Owners’ anticipated evidence, and urged the court
not to reconsider the earlier findings.
¶ 13 The court didn’t rule on the motions before the start of the
hearing but instructed Dakota’s counsel to raise the issues as they
came up. At the start of the hearing, the court said that its role was
“to determine whether [Haber]’s conduct conformed to that of
impartial appraiser”; that it would revisit the earlier findings in
considering this issue under the appropriate standard; and that,
while the supreme court had ruled that the fee cap didn’t by itself
render Haber biased, the cap still could be relevant if it motivated
Haber to advocate for Dakota. Dakota’s counsel disagreed with the
court’s directives and asked for a stay to allow it to file a C.A.R. 21
7
petition asking the supreme court to weigh in on the issues. The
court denied the stay and proceeded with the hearing.
¶ 14 After the hearing, the remand court issued new findings and
conclusions finding that Haber wasn’t impartial, reasoning that
Haber was not a credible witness and that there were “multiple
examples of her advocacy and overall failure to act in an unbiased,
disinterested, and unswayed by personal interest [manner].” The
court made detailed findings of partiality, separated into three
categories: (1) biased and acting as an advocate; (2) interested; and
(3) swayed by personal interest.
¶ 15 In the first category — bias and advocating for Dakota — the
court found that
• during and after the appraisal, Haber didn’t believe it was
important for appraisers to be unbiased (although at the
remand hearing she changed her testimony on this point
and said she previously had “lost [her] mind”);
• Haber testified that she could advocate and remain
unbiased, that it’s “natural” for appraisers to advocate for
insureds, and that it would be appropriate for her to “favor”
Dakota if it was a close call;
8
• Haber said she couldn’t remember getting instructions from
Benglen about what to include in her appraisal, how to
handle the umpire, and how to present her appraisal to the
umpire — yet other witnesses testified to these facts, which
show Haber was motivated by a desire to help Dakota1; and
• Haber refused to answer whether it was appropriate for an
appraiser to decide on the outcome of a claim before
evaluating the claim.
¶ 16 In the second category — interest — the court found that
• Haber denied or couldn’t remember Benglen urging her to
include losses from a later storm in her appraisal so as to
take advantage of Owners’ more favorable policy compared
with the policy in effect during the storm;
• Haber conceded at the hearing that the later losses
should’ve been part of a separate claim — yet there was no
evidence she had tried to distinguish those losses from the
losses occurring during the policy period;
1The remand court found that Benglen had prodded Haber to “go in
at $4.5 million” with her estimate and that she ultimately provided
a total estimate to the umpire of nearly $4.4 million, which was
within “Benglen’s targeted range.”
9
• Benglen held Haber out as an expert on insurance policies
(specifically, on maximizing insurance damage estimates);
• Haber had sued Owners in a separate matter; and
• Haber said she didn’t recall advising Dakota that she was
“very confident” in a positive outcome on the claims but
denied that such a statement would be inappropriate.
¶ 17 And, as to the third category — swayed by personal interest —
the court found that
• Haber acted as Benglen’s “business associate” or “partner”
at the same time she was acting as Dakota’s appraiser;
• Benglen introduced Haber as his “associate,” and she never
corrected him;
• Haber didn’t disclose her association with Benglen to
Owners; and
• Haber’s conduct under the fee cap agreement was “subject
to review in terms of the impartiality requirement” and, at a
minimum, four line items in her appraisal represented
overreaching to gain personal interest — (1) ridge caps,
when there weren’t any before the covered storm events;
(2) re-nailing roof sheathing, when she admitted the county
10
doesn’t require it and she had no proof it was needed;
(3) skylight replacement, when there was insufficient
evidence to show the skylights were damaged; and
(4) satellite dish remounting, when there wasn’t evidence
that any satellite dish was mounted on any roof.
¶ 18 Based on all these findings, the court found that “Haber’s
conduct in estimating this loss smacks of unabashed advocacy” and
“is the antithesis of that of an impartial appraiser.” Thus, the court
concluded, her conduct didn’t meet the impartiality standard from
Owners Insurance II and the appraisal award had to be vacated. It
entered judgment accordingly.
II. Analysis
¶ 19 Dakota contends that the remand court erred in four ways:
(1) by failing to follow the law of the case; (2) through its rulings
(or failure to rule) on pre-hearing motions, a requested stay, and
evidentiary objections; (3) by applying the wrong legal standard; and
(4) by making unsupported factual findings. We consider each
contention in turn.
11
A. Law of the Case
¶ 20 Dakota contends that the remand court failed to follow the law
of the case in its proceedings on remand. We are not persuaded.
¶ 21 We review de novo whether a trial court correctly followed the
law of the case. Thompson v. Catlin Ins. Co. (UK) Ltd., 2018 CO 95,
¶ 20; Woodbridge Condo. Ass’n, Inc. v. Lo Viento Blanco, LLC, 2020
COA 34, ¶ 25, aff’d, 2021 CO 56.
¶ 22 The law of the case doctrine contains two branches, which we
analyze differently depending on whether the prior law of the case
involves the court’s own rulings or the rulings of a higher court.
Hardesty v. Pino, 222 P.3d 336, 339 (Colo. App. 2009).
¶ 23 The first branch, referred to generally as the law of the case,
“‘expresses the practice of courts generally to refuse to reopen what
has been decided,’ and has been described as a ‘discretionary rule
of practice.’” People v. Morehead, 2019 CO 48, ¶ 10 (quoting People
ex rel. Gallagher v. Dist. Ct., 666 P.2d 550, 553 (Colo. 1983)). This
doctrine doesn’t prevent a court from revisiting its own prior
rulings, particularly where those rulings are no longer sound due to
changed conditions of law. See Stockdale v. Ellsworth, 2017 CO
109, ¶ 37; McWhinney Centerra Lifestyle Ctr. LLC v. Poag & McEwen
12
Lifestyle Centers-Centerra LLC, 2021 COA 2, ¶ 70. Additionally, the
doctrine applies only to decisions of law — not to the resolution of
factual questions. S. Cross Ranches, LLC v. JBC Agric. Mgmt., LLC,
2019 COA 58, ¶ 40.
¶ 24 The second branch, known as the mandate rule, is not
discretionary. State ex rel. Weiser v. Castle L. Grp., LLC, 2019 COA
49, ¶ 25. Under the mandate rule, “[c]onclusions of an appellate
court on issues presented to it as well as rulings logically necessary
to sustain such conclusions become the law of the case,” which the
trial court must follow on remand. Id. (quoting Super Valu Stores,
Inc. v. Dist. Ct., 906 P.2d 72, 79 (Colo. 1995)). This rule likewise
requires us to follow the supreme court’s mandate. See People v.
Wise, 2014 COA 83, ¶ 8.
¶ 25 We disagree with Owners’ argument that Dakota waived and
withdrew this argument in the remand court. Dakota’s counsel
repeatedly objected to the scope of the remand proceedings. While
at one point counsel conceded that it was “fine” if the court believed
additional evidence would be helpful in deciding the issues, counsel
maintained that the scope of any such evidence and the remand
proceedings generally should be limited. Accordingly, we discern no
13
waiver. See In re Marriage of Schlundt, 2021 COA 58, ¶ 18 (“To
establish waiver, there must be a clear, unequivocal, and decisive
act by the party against whom waiver is asserted.”).
¶ 26 Dakota makes four arguments challenging the remand court’s
compliance with the law of the case. None are persuasive.
¶ 27 First, Dakota argues that the remand court failed to defer to
the initial findings that were affirmed by the division majority and
not reviewed by the supreme court. Essentially, it argues that the
supreme court reviewed only the appraiser impartiality standard
and fee cap issues and, thus, the other issues affirmed by the
division majority remain the law of the case. But the supreme
court’s articulation of the correct impartiality standard — which
differed from the standards applied by the trial court in the earlier
decision and by the division majority in the prior appeal —
necessarily affected all the issues going to Haber’s partiality. The
remand court therefore appropriately followed the supreme court’s
direction to determine whether Haber’s conduct conformed to this
new standard. See Owners Ins. II, ¶ 44. Indeed, while the remand
court had discretion to decide whether another evidentiary hearing
was warranted, the supreme court’s remand instructions required it
14
to reassess whether Haber’s conduct conformed to the newly
articulated standard for impartiality — and, had it not done so, it
would have violated the mandate rule.
¶ 28 Moreover, Dakota’s argument misunderstands the nature and
impact of appellate decisions regarding factual matters. Appellate
courts are not fact finders. If an appellate court affirms a trial
court’s findings of fact, that decision doesn’t set those findings in
stone. It is merely a determination that the findings were supported
by the record and not clearly erroneous. See Woodbridge Condo.
Ass’n, ¶ 24. A trial court remains free to reconsider its own factual
findings later in the case, as long as doing so is consistent with the
mandate. Cf. S. Cross Ranches, ¶ 40 (the law of the case doctrine
doesn’t apply to findings of fact). Thus, the remand court wasn’t
prohibited from reconsidering the prior factual findings.
¶ 29 Next, Dakota argues that the remand court ignored the
instructions in the mandate issued by this court following the
supreme court’s decision. That mandate said that “this case is
returned to the [trial court] for further proceedings consistent with
the opinion of the Colorado Supreme Court and that portion of the
Court of Appeals opinion that was affirmed.” According to Dakota,
15
the portion of the division majority’s opinion that was affirmed
included all rulings other than the impartiality standard. Not so.
The portion that was affirmed related to the fee cap. And, again,
the supreme court’s explicit instructions on remand were to
reconsider Haber’s conduct under the correct standard.
¶ 30 Dakota also argues that the remand court lacked jurisdiction
to consider the fee cap because the supreme court didn’t remand
the case for further consideration of that issue. But the supreme
court’s remand was broad, including a directive to evaluate all of
Haber’s conduct under the correct impartiality standard, and its
ultimate holding as to the fee cap agreement was simply “declin[ing]
to hold that [such agreements] render appraisers partial as a matter
of law.” Owners Ins. II, ¶ 48. Thus, the remand court arguably was
correct in saying that, while the supreme court’s ruling foreclosed it
from finding that the mere existence of the fee cap rendered Haber
partial, it still could consider whether the fee cap may have
motivated Haber to advocate for Dakota.
¶ 31 But even if the supreme court’s ruling is read more broadly to
foreclose further consideration of the impact of the fee cap, the
remand court didn’t make any findings or conclusions specifically
16
related to the fee cap. The court referenced the fee cap in its final
finding on Haber being swayed by personal interest, expressing that
“[Haber]’s conduct under the fee [cap] agreement is subject to
review in terms of the impartiality requirement.”2 But, ultimately,
its finding focused on four specific items Haber erroneously
included in her appraisal. While the fee cap may have suggested to
the court that Haber could personally gain from an inflated
appraisal, the underlying point was that Haber may have inflated
the appraisal to favor Dakota. And this was only one of many
findings the remand court made about Haber’s partiality.
¶ 32 Thus, even if the remand court was overinclusive in what it
considered on remand, that had no impact on the outcome. See
Bernache v. Brown, 2020 COA 106, ¶ 26 (“We will not disturb a
judgment unless a court’s error affected the substantial rights of
the parties,” meaning that it “‘substantially influenced the outcome
of the case or impaired the basic fairness of the trial itself.’” (quoting
Laura A. Newman, LLC v. Roberts, 2016 CO 9, ¶ 24)).
2 We disagree with Owners’ argument that this reference in the
remand court’s decision was to Benglen’s contingency agreement
rather than Haber’s fee cap agreement.
17
¶ 33 Finally, Dakota argues that the remand court erred by
ordering another hearing when the supreme court didn’t direct it to
do so. Dakota acknowledges that the supreme court remanded the
case to “determine whether Dakota’s appraiser’s conduct conformed
to th[e] standard” it had articulated for appraiser impartiality.
Owners Ins. II, ¶ 44; see also id. at ¶¶ 6, 50 (remanding “for further
proceedings consistent with this opinion”). But Dakota argues that
because the supreme court didn’t order a new hearing, the remand
court erred by conducting one and allowing Owners to introduce
expert testimony, raise new arguments, revisit prior arguments, and
introduce new evidence occurring after the first hearing.
¶ 34 To the contrary, when an appellate court issues a general
remand for further proceedings, a trial court may accept new
evidence and reconsider its prior rulings based on that evidence, so
long as the trial court’s actions are consistent with the mandate.
See, e.g., Thompson, ¶¶ 21, 25; Ferrel v. Colo. Dep’t of Corr., 179
P.3d 178, 185 (Colo. App. 2007). And where, as here, an appellate
court articulates new legal standards, it is appropriate for a trial
court on remand to allow the parties “an opportunity to try the case
18
under the appropriate legal standards.” Pub. Serv. Co. v. Blue River
Irrigation Co., 782 P.2d 792, 794 (Colo. 1989).
B. Rulings on Motions
¶ 35 Dakota contends that the remand court abused its discretion
by failing to rule on its pre-hearing motions to establish the scope of
the remand, denying its requested stay, and ruling on evidentiary
objections. See Warembourg v. Excel Elec., Inc., 2020 COA 103,
¶ 88 (reviewing evidentiary rulings for an abuse of discretion);
Christel v. EB Eng’g, Inc., 116 P.3d 1267, 1270 (Colo. App. 2005)
(reviewing decisions whether to stay proceedings for an abuse of
discretion).
¶ 36 Contrary to Owners’ arguments, we conclude that Dakota
preserved its arguments from its pre-hearing motions by filing those
motions and re-raising the issues in the motions at the start of the
hearing, see Banning v. Prester, 2012 COA 215, ¶ 29, and that
Dakota developed its appellate arguments sufficiently for us to
review them, see Woodbridge Condo. Ass’n, ¶ 44.
¶ 37 However, we do agree that Dakota hasn’t articulated any harm
from the court’s delay in addressing the scope of the remand.
Given our rulings affirming the court’s compliance with the law of
19
the case and mandate rule, it follows that the scope of the remand
proceedings was appropriate. And Dakota hasn’t explained how the
delay affected its hearing preparations or otherwise caused it any
prejudice. Thus, even if the court erred in deferring a ruling on the
motions, any such error was harmless. See Bernache, ¶ 26.
¶ 38 The same is true of the remand court’s denial of a stay for
Dakota to file a C.A.R. 21 petition on the scope of the remand.
Again, the scope of the remand proceedings was appropriate, and
Dakota hasn’t articulated any prejudice resulting from the denial of
the stay.
¶ 39 Dakota similarly hasn’t articulated any prejudice relating to its
argument that the remand court employed erroneous and disparate
standards to objections at the hearing. Dakota argues that the
court instructed counsel at the start of the hearing that they
couldn’t lodge speaking objections but then at times allowed
Owners’ counsel to lodge longer objections while limiting Dakota’s
counsel to two-word objections. It also argues that, as a result of
the court’s rulings, it wasn’t able to make a complete record of its
objections and offers of proof. But the few times that counsel or the
court requested an offer of proof, counsel was allowed to provide
20
one. And Dakota hasn’t articulated any additional objections,
explanations, or offers of proof it would’ve provided or how they
would’ve impacted the outcome of the case. Accordingly, any
alleged errors were harmless. See Bernache, ¶ 26.
C. Application of the Legal Standard
¶ 40 Dakota contends that the remand court applied the wrong
legal standard when it vacated the appraisal award. We disagree.
¶ 41 We review de novo whether a trial court applied the correct
legal standard in making factual findings. Briargate at Seventeenth
Ave. Owners Ass’n v. Nelson, 2021 COA 78M, ¶ 18.
¶ 42 We also review de novo issues of contract interpretation,
including interpretation of insurance policy provisions. Morley v.
United Servs. Auto. Ass’n, 2019 COA 169, ¶ 15. We construe an
insurance policy according to the well-settled principles of contract
interpretation, giving effect to the parties’ intent and reasonable
expectations. Id. We enforce an insurance policy as written unless
the language is ambiguous, meaning that it is susceptible on its
face of more than one reasonable interpretation. Id. at ¶ 16.
¶ 43 Dakota relies on Andres Trucking Co. v. United Fire & Casualty
Co. to support its argument that an umpire’s award may be vacated
21
only if any misconduct is attributable to the umpire — not one of
the appraisers. 2018 COA 144. But Andres didn’t consider and
doesn’t say anything about appraiser misconduct. The issue in that
case was an alleged error in the umpire’s calculations. Id. at
¶¶ 48-53. Thus, in saying that a party had “failed to carry its
burden to establish a ‘manifest mistake’ in the umpire’s valuation,”
the division was merely applying the legal standards to the
particular issue in that case. Id. at ¶ 53 (citation omitted).
¶ 44 The Andres division’s articulation of the legal standards,
however, do apply more broadly to this case. This includes the
statements that “[t]he appraisal award issued under an insurance
policy is binding so long as the appraisers (including the umpire)
have performed the duties required of them by the policy” and that
“an appraisal award entered by an umpire may be disregarded only
if the award was made without authority or was made as a result of
fraud, accident, or mistake.” Id. at ¶ 49.3
3 Andres Trucking Co. v. United Fire & Casualty Co. also quotes a
North Carolina case in stating that “[m]istakes by appraisers, like
those made by arbitrators, are insufficient ‘to invalidate an award
fairly and honestly made.’” 2018 COA 144, ¶ 53 (quoting
Harleysville Mut. Ins. Co. v. Narron, 574 S.E.2d 490, 496 (N.C. Ct.
22
¶ 45 Here, Haber’s lack of impartiality signifies both that one of the
appraisers didn’t perform the duties required of her by the policy
and that the award was made without authority. The policy
unambiguously requires that, for an appraisal award to be binding
on the parties, it must be “agreed” to by two of three persons —
either the umpire and “a competent and impartial appraiser” or,
conceivably, two “competent and impartial appraiser[s].” The award
here was signed only by the umpire and Haber, who was not
impartial. Thus, it’s not binding.
¶ 46 In nearly identical circumstances, the Tenth Circuit similarly
concluded that an appraisal award was invalid and, therefore, a
trial court hadn’t erred by vacating it. The Tenth Circuit interpreted
identical policy language to signify that “an appraisal award is valid
only if signed by two impartial appraisers,” including the umpire in
the generic reference to “appraisers.” Auto-Owners Ins. Co. v.
Summit Park Townhome Ass’n, 886 F.3d 852, 857 (10th Cir. 2018);
see also id. at 855-56 (policy language). Thus, after affirming the
App. 2002)). As applied here, an award agreed to by a partial
appraiser is not “fairly and honestly made” where the policy
requires appraiser impartiality.
23
trial court’s ruling that an appraiser who had signed the award was
not impartial, the Tenth Circuit held that “[w]ith [the appraiser]
disqualified, the appraisal award had only one valid signature (the
umpire’s)” and “[t]he award was therefore invalid under the terms of
the insurance policy.” Id. at 857.
¶ 47 Other cases also support this interpretation. See, e.g., Copper
Oaks Master Home Owners Ass’n v. Am. Fam. Mut. Ins. Co., No. 15-
CV-01828-MSK-MJW, 2018 WL 3536324, at *9, *18 (D. Colo. July
23, 2018) (unpublished order) (summarizing federal cases as
holding that, “[i]f the appraiser has a duty to be ‘impartial’ and is
not, then he or she is disqualified without any showing of an effect
of the lack of impartiality on the appraisal process or award” and
vacating an award after determining one of the appraisers and the
umpire were not impartial); Colo. Hosp. Servs. Inc. v. Owners Ins.
Co., No. 14-CV-001859-RBJ, 2015 WL 4245821, at *1, *3 (D. Colo.
July 14, 2015) (unpublished order) (determining that an “appraisal
award was not conducted in accordance with [an insurance] policy”
with language functionally identical to that in this case because the
24
appraiser who agreed to the award wasn’t impartial and, therefore,
vacating the award).4
¶ 48 We agree with these cases and conclude that, where an
insurance policy’s appraisal provision requires the agreement of at
least one impartial appraiser for an award to be binding, the lack of
impartiality by the only appraiser to agree to the award invalidates
it. The remand court therefore did not err by vacating the award.5
D. Factual Findings
¶ 49 Dakota contends that the remand court’s factual findings are
unsupported by the record. Relatedly, it also contends that the
court improperly indicated its intent to rule in Owners’ favor before
the close of evidence. We are not persuaded.
4 Dakota suggests that the federal cases are inapplicable because
they were brought under the CUAA and applied that statute’s
neutral arbitrator standards. But on the relevant issue of what
happens once an appraiser is found impartial, the cases relied not
on the CUAA but on the language of the insurance policies — which
was functionally identical to the language at issue here.
5 Dakota also argues that the remand court erroneously relied on
Providence Washington Insurance Co. v. Gulinson, 73 Colo. 282, 215
P. 154 (1923), in evaluating Haber’s conduct. But the court didn’t
rely on — or even cite — that case in its findings and conclusions.
25
¶ 50 We review a trial court’s findings of fact for clear error and will
not disturb them if there is any evidence in the record to support
them. Woodbridge Condo. Ass’n, ¶ 24. It’s the trial court’s sole
province to resolve factual issues, determine witness credibility,
weigh evidence, and make reasonable inferences from that evidence.
In re Estate of Owens, 2017 COA 53, ¶ 22. We may not reweigh
evidence or substitute our own judgment for the trial court’s. Id.¶ 51 Although it’s true, as Dakota points out, that we subject
factual findings to heightened scrutiny “when a court adopts,
virtually word for word, a party’s proposed findings of fact,”
Woodbridge Condo. Ass’n, ¶ 24 n.8 (emphasis omitted), that’s not
what happened here. There are substantial differences between
Owners’ proposed findings and the findings the court adopted. And
the court made clear that it had conducted its own independent
analysis by stating at the beginning of its order that it had
“considered the proposed orders, case file, and law”; making various
changes to the proposed findings; and adding its own assessment of
witness credibility (particularly as to Haber). See Auto-Owners Ins.
Co. v. Bolt Factory Lofts Owners Ass’n, 2021 CO 32, ¶ 21 n.5.
26
¶ 52 We perceive no merit in Dakota’s argument that the remand
court improperly prejudged the case. Dakota relies solely on the
judge’s comment near the end of the hearing that she “had some
significant regrets” about signing the previous judge’s order right
after she arrived in the division. That vague comment — which
seemed to allude to regrets she may have had at the time or soon
after she signed the order — in no way suggested that she had
prejudged the issues on remand.
¶ 53 Turning to the factual findings on remand, Dakota argues that
the findings on the following issues were not based on competent
evidence: (1) whether the fee cap was operative; (2) whether Haber’s
pre-appointment visit to the property and meeting with Benglen and
Dakota’s board were improper; (3) whether Haber and Benglen were
partners; (4) whether Haber’s inclusion of damage occurring after
the policy period was improper; and (5) whether Haber’s refusal to
answer certain questions at the hearing, her statement during the
appraisal proceedings that she was confident in a positive outcome,
her expert status, and her unrelated lawsuit against a different
insurer evidenced partiality. We reject these challenges.
27
¶ 54 As to the first issue, the remand court didn’t actually find that
the fee cap was operative. As explained in Part II.A, the court
alluded to the fee cap in its final finding on Haber being swayed by
personal interest, but its finding ultimately was based not on the
fee cap being operative but on specific items Haber improperly
included in her appraisal.
¶ 55 As to Haber’s pre-appointment visit to the property and
meeting with Benglen and Dakota’s board, the remand court noted
these facts — which are supported by the record — in its factual
summary. But the court didn’t find that these particular activities
were improper, nor did it cite or directly rely on these activities in
its findings of partiality.
¶ 56 As to the association between Haber and Benglen, Dakota
cites both individuals’ hearing testimony denying any “partnership”
and attempting to explain the reference to a “partner” in some of
their emails. But there was ample evidence that, irrespective of the
lack of any formal partnership, Haber and Benglen had a close
working relationship with respect to the appraisal, and the remand
court was entitled to rely on that evidence.
28
¶ 57 As to Haber’s inclusion of damages post-dating the policy
period, Dakota cites testimony suggesting that both appraisers had
agreed to include in their estimates “all damage to the roofs,”
including damage from a later storm. But there was also evidence
that it was Benglen who elected to include the damage from the
later storm in the claims and that Owners’ appraiser didn’t know
the storm had occurred outside the policy period, when Dakota was
no longer insured by Owners.
¶ 58 Finally, as to Haber’s refusal to answer certain questions, her
statement about being confident in a positive outcome on the claim,
her expert status, and her lawsuit against another insurer, we
discern no reversible error. It was the remand court’s province to
determine witness credibility, the weight to accord the testimony,
and the inferences to be drawn from it. See Owens, ¶ 22. And
while the court was apparently confused about Haber’s lawsuit —
which was not against Owners but another insurance company —
that error was harmless, particularly in light of the court’s various
other findings underlying its determination that Haber was partial.
See Marsico Cap. Mgmt., LLC v. Denver Bd. of Cnty. Comm’rs, 2013
COA 90, ¶¶ 33-37.
29
III. Conclusion
¶ 59 The judgment is affirmed.
JUDGE FURMAN and JUDGE TOW concur.
30