(1) The general assembly finds, determines, and declares that awards in civil actions for noneconomic losses or injuries often unduly burden the economic, commercial, and personal welfare of persons in this state; therefore, for the protection of the public peace, health, and welfare, the general assembly enacts this section placing monetary limitations on such damages for noneconomic losses or injuries.
(2) As used in this section:
(a) "Derivative noneconomic loss or injury" means nonpecuniary harm or emotional stress to persons other than the person suffering the direct or primary loss or injury.
(b) "Noneconomic loss or injury" means nonpecuniary harm for which damages are recoverable by the person suffering the direct or primary loss or injury, including pain and suffering, inconvenience, emotional stress, and impairment of the quality of life. "Noneconomic loss or injury" includes a damage recovery for nonpecuniary harm for actions brought under section 13-21-201 or 13-21-202.
(3) (a) In any civil action other than medical malpractice actions in which damages for noneconomic loss or injury may be awarded, the total of such damages shall not exceed the sum of two hundred fifty thousand dollars, unless the court finds justification by clear and convincing evidence therefor. In no case shall the amount of noneconomic loss or injury damages exceed five hundred thousand dollars. The damages for noneconomic loss or injury in a medical malpractice action shall not exceed the limitations on noneconomic loss or injury specified in section 13-64-302.
(b) In any civil action, no damages for derivative noneconomic loss or injury may be awarded unless the court finds justification by clear and convincing evidence therefor. In no case shall the amount of such damages exceed two hundred fifty thousand dollars.
(c) (I) The limitations on damages set forth in paragraphs (a) and (b) of this subsection (3) shall be adjusted for inflation as of January 1, 1998, and January 1, 2008. The adjustments made on January 1, 1998, and January 1, 2008, shall be based on the cumulative annual adjustment for inflation for each year since the effective date of the damages limitations in paragraphs (a) and (b) of this subsection (3). The adjustments made pursuant to this subparagraph (I) shall be rounded upward or downward to the nearest ten-dollar increment.
(II) As used in this paragraph (c), "inflation" means the annual percentage change in the United States department of labor, bureau of labor statistics, consumer price index for Denver-Boulder, all items, all urban consumers, or its successor index.
(III) The secretary of state shall certify the adjusted limitation on damages within fourteen days after the appropriate information is available, and:
(A) The adjusted limitation on damages shall be the limitation applicable to all claims for relief that accrue on or after January 1, 1998, and before January 1, 2008; and
(B) The adjusted limitation on damages as of January 1, 2008, shall be the limitation applicable to all claims for relief that accrue on and after January 1, 2008.
(IV) Nothing in this subsection (3) shall change the limitations on damages set forth in section 13-64-302, or the limitation on damages set forth in section 33-44-113, C.R.S.
(4) The limitations specified in subsection (3) of this section shall not be disclosed to a jury in any such action, but shall be imposed by the court before judgment.
(5) Nothing in this section shall be construed to limit the recovery of compensatory damages for physical impairment or disfigurement.
(6) (a) (I) In any claim for breach of contract, damages for noneconomic loss or injury or for derivative noneconomic loss or injury are recoverable only if:
(A) The recovery for such damages is specifically authorized in the contract that is the subject of the claim; or
(B) In any first-party claim brought against an insurer for breach of an insurance contract, the plaintiff demonstrates by clear and convincing evidence that the defendant committed willful and wanton breach of contract.
(II) For purposes of this paragraph (a), "willful and wanton breach of contract" means that:
(A) The defendant intended to breach the contract;
(B) The defendant breached the contract without any reasonable justification; and
(C) The contract clearly indicated that damages for noneconomic loss or injury or for derivative noneconomic damages or loss were within the contemplation or expectation of the parties.
(b) Except for the breach of contract damages that are permitted pursuant to sub-subparagraph (B) of subparagraph (I) of paragraph (a) of this subsection (6), nothing in this subsection (6) shall be construed to prohibit one or more parties from waiving the recovery of damages for noneconomic loss or injury or for derivative noneconomic loss or injury on a breach of contract claim so long as the waiver is explicit and in writing.
(c) The limitations on damages set forth in subsection (3) of this section shall apply in any civil action to the aggregate sum of any noneconomic damages awarded under this section for breach of contract including but not limited to bad faith breach of contract.
(d) In any civil action in which an award of damages for noneconomic loss or injury or for derivative noneconomic loss or injury is made on a breach of contract claim, the court shall state such award in the judgment separately from any other damages award.
(e) Except as otherwise provided in paragraph (c) of this subsection (6), nothing in this subsection (6) shall be construed to govern the recovery of noneconomic damages on a tort claim for bad faith breach of contract.
Source: L. 86: Entire section added, p. 677, 1, effective July 1. L. 89: (2)(b) amended, p. 752, 1, effective July 1. L. 97: (3)(c) added, p. 923, 4, effective August 6. L. 2003: (3)(a) amended, p. 1787, 1, effective July 1. L. 2004: (6) added, p. 770, 2, effective July 1. L. 2007: (3)(c)(I) and (3)(c)(III) amended, p. 329, 3, effective July 1.
Cross references: For the legislative declaration contained in the 1997 act enacting subsection (3)(c), see section 1 of chapter 172, Session Laws of Colorado 1997. For the legislative declaration contained in the 2004 act enacting subsection (6), see section 1 of chapter 232, Session Laws of Colorado 2004. For the legislative declaration contained in the 2007 act amending subsections (3)(c)(I) and (3)(c)(III), see section 1 of chapter 83, Session Laws of Colorado 2007.
Law reviews. For article, "Legal Aspects of Health and Fitness Clubs: A Healthy and Dangerous Industry", see 15 Colo. Law. 1787 (1986). For article, "Introduction to the Tort Reform Symposium: Some Cautioning Implications of Legislative Tort Reform", see 64 Den. U. L. Rev. 613 (1988). For article, "Emotional Distress, The First Amendment, and 'This kind of speech': A Heretical Perspective on Hustler Magazine v. Falwell", see 50 U. Colo. L. Rev. 315 (1989). For article, "Recovery of Interest: Part I -- Personal Injury", see 18 Colo. Law. 1063 (1989). For article, "Physical Impairment and Disfigurement Under the Health Care Availability Act", see 28 Colo. Law. 65 (May 1999). For article, "The Impact of Tort Reform on Product Liability Litigation in Colorado", see 30 Colo. Law. 91 (Nov. 2001). For article, "Measuring Damages for Tortious Injury to Companion Animals", see 42 Colo. Law. 21 (Feb. 2013).
Constitutionality of limitation. The provisions of subsection (3) limiting the amount recoverable for noneconomic damages does not violate equal protection or due process under either the state or federal constitutions or access to the courts under the state constitution. Scharrel v. Wal-Mart Stores, Inc., 949 P.2d 89 (Colo. App. 1997); Stewart v. Rice, 25 P.3d 1233 (Colo. App. 2000), rev'd on other grounds, 47 P.3d 316 (Colo. 2002).
Limitation in this section is subject to waiver. Where defendant insurance company did not argue for applicability of this section at trial, did not object to a jury instruction on special damages, and made no significant argument concerning the issue on appeal, the issue was deemed waived and the jury's award of $900,000 in special damages was allowed to stand. Giampapa v. Am. Family Mut. Ins. Co., 64 P.3d 230 (Colo. 2003).
Cap on noneconomic damages imposed by this section applies to the liability share of each defendant and does not act as cap on the total amount a plaintiff may recover. General Elec. Co. v. Niemet, 866 P.2d 1361 (Colo. 1994).
Defendant cannot be held liable for more than its pro rata share of damages even where it is permissible to exceed the damages cap. Hoffman v. Ford Motor Co., 690 F. Supp. 2d 1179 (D. Colo. 2010).
In cases involving multiple defendants or where plaintiff is partly at fault pro rata liability of defendants and plaintiff must be ascertained before applying statutory cap on noneconomic damages. General Elec. Co. v. Niemet, 866 P.2d 1361 (Colo. 1994).
The intent of this section is to limit the amount of damages for which each party must account, not to allow persons to escape accountability. Niemet v. General Elec. Co., 843 P.2d 87 (Colo. App. 1992).
Section does not limit a defendant's liability based upon the number of plaintiffs. Several claimants, each of whom suffered separate and distinct injuries caused by the same tortious conduct of the same liable party, may each recover noneconomic damages up to the statutory cap. Palmer v. Diaz, 214 P.3d 546 (Colo. App. 2009).
In order to harmonize subsections (2)(b) and (3)(a) with (5), it is necessary to determine separately damages of a noneconomic nature for physical impairment and disfigurement from the noneconomic loss or injury defined in subsection (2)(b). By such means, the limitation on recoverable damages contained in subsection (3)(a) and the unlimited recovery for physical impairment and disfigurement as provided for in subsection (5) can be harmonized. Herrera v. Gene's Towing, 827 P.2d 619 (Colo. App. 1992); Ledstrom by and through Ledstrom v. Keeling, 10 F. Supp. 2d 1195 (D. Colo. 1998).
"Thin-skulled plaintiff" rule applies to damages under this section. Award of damages for non-economic loss should not have been reduced because of the plaintiff's unique psychological makeup or preexisting degenerative bone condition. Giampapa v. Am. Family Mut. Ins. Co., 12 P.3d 839 (Colo. App. 2000), rev'd on other grounds, 64 P.3d 230 (Colo. 2003).
"Thin skull" instruction is appropriate in a breach of insurance contract action. Giampapa v. Am. Family Mut. Ins. Co., 12 P.3d 839 (Colo. App. 2000), rev'd on other grounds, 64 P.3d 230 (Colo. 2003).
The Health Care Availability Act, 13-64-101 through 13-64-503, limits the total recovery for all noneconomic loss or injury to $250,000, including any such loss or injury resulting from physical impairment or disfigurement. Plaintiffs may not recover for a separate category of damages for physical impairment and disfigurement in addition to the statutory categories set forth in 13-64-204. Ledstrom by and through Ledstrom v. Keeling, 10 F. Supp. 2d 1195 (D. Colo. 1998) (disagreed in Preston v. Dupont, 35 P.3d 433 (Colo. 2001), where Colorado supreme court disagreed with federal court).
However, damages for physical impairment and disfigurement are subject to the Health Care Availability Act's one million dollar damages limitation. Wallbank v. Rothenberg, 74 P.3d 413 (Colo. App. 2003).
Noneconomic damages in the Health Care Availability Act in 13-64-302 are not limited by the general damages cap in this section nor by the damages cap in 13-64-302. Damages for physical impairment and disfigurement in a medical malpractice action are not limited and properly constitute a separate category for the jury's deliberation. Preston v. Dupont, 35 P.3d 433 (Colo. 2001).
Enhanced award not available in wrongful death actions pursuant to 13-21-203 (1). Aiken v. Peters, 899 P.2d 382 (Colo. App. 1995).
Pro rata liability, provided for in 13-21-111.5, should be apportioned before damages are capped as required by this section. A construction of this section that caps each separate noneconomic award, rather than awards for entire actions, averts subversion of the intended effect of 13-21-111.5 (2). Niemet v. General Elec. Co., 843 P.2d 87 (Colo. App. 1992).
Where award for noneconomic loss exceeded total allowable by subsection (3) but a reduction of the award was to be calculated to allow for the negligence of persons other than defendant, proper method of calculation of award was to reduce award by negligence attributed to others first without regard to total allowable in subsection (3). Cooley v. Paraho Dev. Corp., 851 P.2d 207 (Colo. App. 1992).
Neither this section nor C.R.C.P. 52 required the trial court to make specific findings of clear and convincing evidence for not reducing the award of noneconomic damages. Herrera v. Gene's Towing, 827 P.2d 619 (Colo. App. 1992).
The fact that a plaintiff may or should be able to prove noneconomic losses in many or most cases in which the threshold for medical expenses under the no fault law has been reached does not mean that the plaintiff actually will prove or has proven noneconomic damages in any particular case since circumstances vary as does the proof presented in each case and to hold otherwise is likely to have the unintended consequence of encouraging needless litigation. Lee's Mobile Wash v. Campbell, 853 P.2d 1140 (Colo. 1993) (disagreeing with Villandry v. Gregerson, 824 P.2d 829 (Colo. App. 1991)).
There was evidence in the record to support the jury award of zero noneconomic damages, and the fact that the jury instruction mandated that the jury "shall determine" the amount of noneconomic damages did not necessarily require an affirmative award of damages since an award of such damages was required only if the damages were caused by the petitioners' negligence. Lee's Mobile Wash v. Campbell, 853 P.2d 1140 (Colo. 1993).
Personal representative cannot recover noneconomic damages such as emotional stress or loss of enjoyment of life. Hill v. Boatright, 890 P.2d 180 (Colo. App. 1994), aff'd sub nom. Boatright v. Derr, 919 P.2d 221 (Colo. 1996).