USAA v. Parker

Summary

The Supreme Court of Colorado held that prejudgment interest in an insured's underinsured motorist benefits action is governed by the personal injury statute rather than the wrongful withholding statute. The court concluded that prejudgment interest is part of the damages recoverable under Colorado's UM/UIM statute and therefore must be calculated at nine percent per year from the date of the accident. The court also held that the insurer's payment of the judgment did not moot the appeal because the parties had not agreed that payment would waive appellate review.

Holdings

1. The appeal was not barred by the acceptance-of-benefits doctrine because the appeal did not challenge USAA's right to release of its supersedeas bond and the parties had not manifested a mutual intention to conclude the prejudgment-interest dispute.
2. Payment of the money judgment did not moot the appeal because there was no agreement that payment would waive appellate review, and the payment could be restored if USAA prevailed.
3. When an insured succeeds on a claim against a UIM insurer for benefits arising from personal injuries, prejudgment interest is calculated under Colorado's personal injury statute, section 13-21-101(1), rather than the wrongful-withholding statute, section 5-12-102.
4. Peterman v. State Farm Mutual Automobile Insurance Co. is overruled to the extent it is inconsistent with the Supreme Court's interpretation of Allstate Insurance Co. v. Starke.

Questions Presented

1. Whether USAA's payment of the disputed prejudgment interest and release of its supersedeas bond rendered the appeal moot under the acceptance-of-benefits or voluntary-satisfaction-of-judgment doctrines.
2. Whether prejudgment interest on a UIM benefits judgment arising from an underlying personal injury tort is calculated under Colorado's personal injury statute, section 13-21-101(1), or its wrongful-withholding statute, section 5-12-102.
3. Whether prejudgment interest is subject to the UIM policy limits under the rule recognized in Allstate Insurance Co. v. Starke.

Disposition

affirmed