Baros v. Sentry Insurance A Mutual Company
ORDER. Sentrys Motion for Bifurcation of Trial 11 is DENIED. By Judge Lewis T. Babcock on 3/12/2012.(sah, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
LEWIS T. BABCOCK, JUDGE
Civil Case No. 11-cv-02487-LTB-KLM
SENTRY INSURANCE, a mutual company,
This matter is before me on Defendant Sentry Insurance’s (“Sentry”) Motion for Bifurcation
of Trial [Doc #11]. After considering the parties’ arguments, and for the reasons below, I DENY the
Plaintiff Nicole Baros (“Baros”) was injured in a car accident. At that time, she had an
automobile insurance policy issued by Sentry. After making and settling a claim against the driver
who hit her, Baros submitted a claim for $25,000 to Sentry for her injuries pursuant to the
underinsured motorist (“UIM”) provision of her policy. Sentry countered with an offer of $2,000.
Dissatisfied with Sentry’s conduct, Baros filed suit in state court alleging two causes of
action. The first is a claim under Colo. Rev. Stat. §§ 10-3-1115 and 1116. The second is breach of
contract. Sentry removed the matter to this Court on diversity grounds per 28 U.S.C. §§ 1441 and
1332. Now, with this motion, Sentry seeks to bifurcate Baros’ two claims into two separate trials.
Rule 42(b) of the Fed. R. Civ. P. allows a court to order separate trials for separate claims
“[f]or convenience, to avoid prejudice, or to expedite and economize.” Fed. R. Civ. P 42(b); accord
King v. McKillop, 112 F.Supp.2d 1214, 1221 (D. Colo. 2000). I have wide discretion in deciding
whether to bifurcate or sever issues for trial. Easton v. City of Boulder, Colo., 776 F.2d 1441, 1447
(10th Cir. 1985); accord Gaede v. Dist. Ct. In and For Eighth Judicial. Dist., 676 P.2d 1186, 1188
(Colo. 1984) (“A trial court enjoys broad discretion under C.R.C.P. 42(b) to order separate trials on
specific issues in appropriate civil cases.”). And while I have discretion to order separate trials,
“that does not mean that severance is the norm or even a common occurrence.” The Marianist
Province of the United States, Inc. v. Ace USA, 2010 WL 2681760, *1 (D. Colo. July 2, 2010) (citing
Fed. R. Civ. P 42(b) advis. comm. notes (noting that bifurcation should not “routinely be ordered”));
see also Gaede, 767 P.2d at 1188 (explaining that the reasons listed in C.R.C.P. 42(b) for bifurcating
are “conditions” such that, in their absence, bifurcation is “inapplicable”).
For the reasons herein, I conclude that Sentry does not show a need for bifurcation. I begin
by examining the nature of Baros’ two claims. See, e.g., Gaede, 676 P.2d at 1188 (explaining that,
to analyze whether to bifurcate, a court should consider “the interrelationships of issues and claims”
and the “potential duplication of evidence”). (I note that because this is a diversity case, I look to
state law when examining the substantive claims. See Wagner v. Live Nation Motor Sports, Inc.,
586 F.3d 1237, 1244 (10th Cir. 2009).) Her first claim is brought under Colo. Rev. Stat. §§ 10-31115 and 1116. Section 1115 proscribes insurers from “unreasonably delaying or denying a payment
of a claim for benefits” owed to a first-party claimant. Colo. Rev. Stat. § 10-3-1115. Section 1116
provides that “[a] first-party claimant as defined in section 10-3-1115 whose claim for payment of
benefits has been unreasonably delayed or denied may bring an action in district court to recover
reasonable attorney fees and court costs and two times the covered benefit.” Id. § 1116. Her second
claim is that by refusing to pay her UIM benefits under the policy, Sentry breached that contract.
These two claims are much more closely related than Sentry suggests. They derive from the
same occurrence: Sentry’s refusal to pay Baros more than $2,000 under the policy for the 2010 car
accident. See Salazar v. State Farm Mut. Ins. Auto. Ins., Co., 148 P.3d 278, 281-82 (Colo. App.
2006) (holding that a plaintiff who had previously brought and won a UIM benefits action against
his insurer was precluded by res judicata from later bringing claims for statutory violations and bad
faith breach of an insurance contract in part because the “facts underlying Salazar's UIM benefits
case and bad faith claims were related in time, space, origin, or motivation” and because it would
have been convenient to bring the claims together). And while the claims present different legal
theories, “they s[eek] redress for essentially the same wrong.” Salazar, 148 P.3d at 281. The UIM
benefits claim seeks to determine the amount of damages Sentry should pay under the policy, while
her section 1116 claim seeks redress for Sentry’s allegedly unreasonable refusal to pay the benefits.
See id. Her claims also rest on a similar factual basis–the circumstances of the accident, the
particulars of the insurance policy, and Sentry’s conduct in refusing to pay. See id. This fraternal
twin nature of the claims weighs against bifurcation.
With this relationship established, I turn to Rule 42(b)’s reasons for bifurcation. Sentry does
not offer a compelling argument that bifurcation would be more convenient or would expedite and
economize the instant case. If the claims were severed, the two cases would largely be duplicative
because the claims rest on similar factual bases, meaning that, at both cases, much of the exact same
evidence would be presented and a majority of the same witnesses would testify. See id. at 282
(“Salazar's bad faith claims would involve much of the same evidence as the UIM benefits claim.
Thus, for the jury to hear these claims in the same action would have been convenient and
efficient.”) (emphasis added); accord Gaede, 676 P.2d at 1188. Indeed, by virtue of the nature of
the two claims, a second trial on the section 1116 claim would have to retry every issue tried in the
UIM benefits claim case. See, e.g., Salazar, 148 P.3d at 282. This would also lead to an unnecessary
duplication in attorney’s fees. See, e.g., Novell v. American Guarantee and Liability Insurance Co.,
15 P.3d 775, 779 (Colo. App. 1999) (affirming the trial court’s decision to deny the defendantinsurer’s motion to bifurcate plaintiff’s claims for breach of a commercial property insurance
contract, bad faith breach of that contract, and willful and wanton misconduct because the
duplication in evidence and attorney’s fees would have been “significant”).
Sentry argues that, depending on the outcome of the UIM benefits claim, a trial on the
section 1116 claim may be unnecessary. This is unavailing. For one, to some extent, this can be
addressed in one trial with the jury instructions. For example, the jury can be instructed that if they
find that Baros is not entitled to UIM benefits, they should not consider the section 1116 claim and
its evidence. In terms of convenience and judicial economy, the potential benefit of bifurcation is
also marginal. This is because, assuming the claims are bifurcated and Baros loses her UIM benefits
case, much of the evidence in the obviated section 1116 case would have already been presented in
the prior UIM benefits case. Stated differently, bifurcation would not spare the presentation of an
overwhelming amount of the total evidence because a substantial portion of the evidence in the
contingent section 1116 case will be presented in the UIM benefits case. Thus, any convenience or
judicial economy that bifurcation may yield is merely that quantum of evidence pertaining
exclusively to the section 1116 claim. It would be more efficient and economical, then, to simply
add that quantum of evidence to the UIM benefits case given the concomitant costs of a second trial.
Additionally, while Sentry’s argument may be true, it does not compel me to bifurcate the claims,
especially in light of the possible costs and redundancies bifurcation may wrought. On balance, I
conclude that the potential costs from bifurcating outweigh its speculative and marginal benefit.
Sentry also fails to demonstrate how trying the claims together would result in sufficient
prejudice. A single trial, it asserts, will prejudice it and confuse the jury by “allowing both evidence
of liability and damages for alleged personal injuries in the auto accident–asserted against the
tortfeasor–and evidence on the insurance claim–asserted not against the tortfeasor but against [it].”
This argument is overstated. First, as stated, much of the evidence overlaps both claims such that
a jury for the section 1116 claim would hear all of the evidence that a jury for the UIM benefits case
would heard. Second, discerning the UIM benefits evidence from the section 1116 evidence is
easier than Sentry posits: any evidence beyond whether Baros was entitled to UIM benefits and, if
so, what amount, pertains to the section 1116 claim. Third, and most importantly, any prejudice can
be mitigated by appropriate jury instructions.
Accordingly, for the foregoing reasons, IT IS ORDERED that Sentry’s Motion for
Bifurcation of Trial [Doc #11] is DENIED.
, 2012 in Denver, Colorado.
BY THE COURT:
s/Lewis T. Babcock
LEWIS T. BABCOCK, JUDGE
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