Tyco International Ltd. v. Chartis Inc. et al

Filing 36

ORDER Denying Defendant's 28 Motion for Summary Judgment, by Judge Richard P. Matsch on 1/20/2012.(rpmcd)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Senior District Judge Richard P. Matsch
Civil Action No. 11-cv-00832-RPM
ADT HOLDINGS, INC.,
ADT SECURITY SERVICES, INC., and
AUTOMATED SECURITY CORP.,
Plaintiffs,
v.
NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA.,
Defendant.
_____________________________________________________________________
ORDER DENYING DEFENDANT’S MOTION FOR SUMMARY JUDGMENT
_____________________________________________________________________
The defendant, National Union Fire Insurance Company of Pittsburgh, Pa.
(“National Union”), moved for summary judgment of dismissal of this civil action,
claiming that it can have no liability for payment under its commercial umbrella policy
because its insured, Sonitrol, was found liable for willful and wanton breach of contract
in the failure to perform its obligations for installation, repair maintenance and offsite
monitoring of burglar alarm equipment installed in a warehouse damaged by a fire
following a burglary. National Union contends that the jury’s finding that the breach was
willful and wanton precludes enforcement of the policy under established Colorado
common law that insuring agreements protecting an insured from intentional
wrongdoing or reckless conduct with conscious disregard for the rights and safety of
others are void as being contrary to public policy.
The defendant cites Bohrer v. Church Mut. Ins. Co., 965 P.2d 1258, 1262 (Colo.
1998) and Bohrer v. Church Mut. Ins. Co., 12 P.3d 854, 856 (Colo. App. 2000) as

illustrating the principle that Colorado courts will not enforce an agreement to indemnify
a party for damages resulting from intentional or willful wrongful acts. Those and the
other Colorado cases cited by National Union are not applicable. They are based on
tort law. The underlying judgment in this case results from a jury’s findings that Sonitrol
breached a contractual promise and the good faith and fair dealing obligation implicit in
that contract in a manner that was characterized in the court’s instructions as follows:
Willful and wanton means an act or omission purposefully
committed by a person who must have realized that the conduct was
dangerous, and which conduct was done heedlessly and recklessly, either
without regard to the consequences, or without regard to the rights and
safety of others, particularly the plaintiffs.
Instruction No. 15, Exhibit F.
Colorado has conflated tort and contract law in a confusing and unclear manner.
Whatever it means to breach a contractual promise in a willful and wanton manner, it is
not equivalent to that type of conduct that Colorado courts finds so reprehensible that
the actor’s liability for compensatory damages cannot be indemnified. It is
ORDERED, that the defendant’s motion for summary judgment (Doc. 28) is
denied.
DATED: January 20th, 2012
BY THE COURT:
s/Richard P. Matsch
__________________________
Richard P. Matsch, Senior Judge

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