Bad Faith Blog

Summary: Green Earth, the operator of a Colorado Springs retail medical marijuana business and growing facility submitted a claim to its insurer for a wildfire-caused smoke and ash damage and a separate break in and theft. Atain denied the claims on multiple grounds which caused Green Earth to sue Atain for breach of contract and statutory claims for bad faith and unreasonable delays in payment. The District Court was confronted with numerous motions addressing what was and was not covered under the policy issued to Green Earth and whether Green Earth’s bad faith and delayed payment claims were sustainable. After reviewing the coverage issues at length, the Court granted summary judgment to Atain on Green Earth’s bad faith and unreasonable delay in payment claims regarding the theft, but questions of fact regarding parts of the wildfire claim and Green Earth’s related statutory claims for bad faith and unreasonable delay in payment precluded summary judgment.

Summary: Insured brought breach of contract and bad faith claim against commercial property insurer for denial of coverage for the cost of labor to replace fixtures stolen from insured’s vacant rental home and the cost of lost monthly rent after the rental home was burglarized. The trial court entered summary judgment in favor of the insured. The appellate court affirmed in part and reversed in part.