Colorado CRS 13-17-202 Update...

In prior years, an insurance offer of judgment was often a threat by the defense insurance industry to say to the Plaintiff if you don't get a judgment in excess of our "low ball" offer of judgment, you will get stuck with all the defense costs and all of your own costs in the lawsuit.

After July 1, 2008 the significant change is if you are threatened by an insurance offer of settlement, and you have a jury verdict award in your favor you will be allowed to collect your actual costs that accrued prior to the insurance offer of settlement even where the jury award was less than what was offered by the Defense.

However, without the wise assistance of counsel, there are still pitfalls and risks of getting stuck with defense costs in the tens of thousands of dollars at trial.

C.R.S 13-17-202.

Award of actual costs and fees when offer of settlement was made.

(1) (a) Notwithstanding any other statute to the contrary, in any civil action of any nature commenced or appealed in any court of record in this state:

(I) If the plaintiff serves an offer of settlement in writing at any time more than fourteen days before the commencement of the trial that is rejected by the defendant, and the plaintiff recovers a final judgment in excess of the amount offered, then the plaintiff shall be awarded actual costs accruing after the offer of settlement to be paid by the defendant.

(II) If the defendant serves an offer of settlement in writing at any time more than fourteen days before the commencement of the trial that is rejected by the plaintiff, and the plaintiff does not recover a final judgment in excess of the amount offered, then the defendant shall be awarded actual costs accruing after the offer of settlement to be paid by the plaintiff. However, as provided in section 13-16-104, if the plaintiff is the prevailing party in the action, the plaintiff's final judgment shall include the amount of the plaintiff's actual costs that accrued prior to the offer of settlement.

(III) If an offer of settlement is not accepted in writing within fourteen days after service of the offer, the offer shall be deemed rejected, and the party who made the offer is not precluded from making a subsequent offer. Evidence thereof is not admissible except in a proceeding to determine costs.

(IV) If an offer of settlement is accepted in writing within fourteen days after service of the offer, the offer of settlement shall constitute a binding settlement agreement, fully enforceable by the court in which the civil action is pending.

(V) An offer of settlement under this section shall remain open for at least fourteen days from the date of service unless withdrawn by service of withdrawal of the offer of settlement.

(VI) An offer of settlement served at any time fourteen days or less before the commencement of the trial shall not be subject to this section, and evidence thereof is not admissible for any purpose.

(b) For purposes of this section, "actual costs" shall not include attorney fees but shall mean costs actually paid or owed by the party, or his or her attorneys or agents, in connection with the case, including but not limited to filing fees, subpoena fees, reasonable expert witness fees, copying costs, court reporter fees, reasonable investigative expenses and fees, reasonable travel expenses, exhibit or visual aid preparation or presentation expenses, legal research expenses, and all other similar fees and expenses.

(2) When comparing the amount of any offer of settlement to the amount of a final judgment actually awarded, any amount of the final judgment representing interest subsequent to the date of the offer in settlement shall not be considered.

(3) When the liability of one party to another has been determined by verdict or order or judgment, but the amount or extent of the liability remains to be determined by further proceedings, the party adjudged liable may make an offer of settlement, which shall have the same effect as an offer made before trial (except with respect to costs already incurred) if it is served pursuant to subsection (1) of this section.

Source: L. 90: Entire section added, p. 852, § 14, effective May 31. L. 95: Entire section amended, p. 1194, § 1, effective July 1. L. 2003: (1) amended, p. 1359, § 1, effective July 1. L. 2008: (1)(a)(II) amended, p. 8, § 1, effective July 1.

Editor's note: Section 2 of chapter 5, Session Laws of Colorado 2008, provides that the act amending subsection (1)(a)(II) applies to offers of settlement made on and after July 1, 2008.

Editor's note: This section was contained in a 2008 act that was passed without a safety clause. For further explanation concerning the effective date, see page ix of this volume.

Colorado Revised Statutes are made available for public use by the Committee on Legal Services of the Colorado General Assembly. The statutes are copyrighted by the state of Colorado (please see §2-5-115, C.R.S and §2-5-118, C.R.S..).