Chapter 2 - § 2.9 • EFFECT OF RELEASE OF UNINSURED MOTORIST ON INSURER'S LIABILITY — RELEASE EXECUTED BY INSURED IN FAVOR OF UNINSURED MOTORIST BARRED UM CLAIM BY INSURED AGAINST INSURER

• Jurisdiction: Colorado

§ 2.9 • EFFECT OF RELEASE OF UNINSURED MOTORIST ON INSURER'S LIABILITY — RELEASE EXECUTED BY INSURED IN FAVOR OF UNINSURED MOTORIST BARRED UM CLAIM BY INSURED AGAINST INSURER

Where insured received payment of $5,000 from uninsured motorist with whom insured was involved in accident, and insured executed a "full and final release" of liability for property damage, medical expenses, and pain and suffering, insured was barred from pursuing UM claim against his own insurer. There were no grounds to set aside release for "mutual mistake," because insured was aware of the nature of his injuries when he executed release. Artery v. Allstate Insurance Co., 984 P.2d 1187 (Colo. App. 1999).

Artery v. Allstate Insurance Co., 984 P.2d 1187 (Colo. App. 1999), arose out of an automobile accident that occurred on June 1, 1994. The accident involved the plaintiff, Dennis Artery, and an uninsured motorist. On June 4, 1994, in consideration of a payment of $5,000, Artery executed a release in favor of the uninsured motorist. The release purported to be a "full and final release of liability" for "property damages, medical expenses and pain and suffering." Id. at 1191. Within several months of executing this release, Artery began receiving treatment for neck and lower back problems. Artery then made a claim to his own insurance company, Allstate, for damages caused by the accident. Allstate denied the claim, asserting both that the language of the release barred any further claims and that Artery's failure to secure Allstate's consent before signing the release barred any UM claim pursuant to the policy language. If the release was valid and precluded any further claims against the uninsured motorist, then Artery was not entitled to UM coverage, since such coverage is applicable only where the insured is "legally entitled" to collect damages from an uninsured motorist.

In response to Allstate's denial of coverage, Artery brought suit against Allstate. He argued that the release was not a full release but only a partial release that released claims for certain damages stemming from his bodily injury caused by the accident. Artery also argued that the release should be set aside entirely due to mutual mistake, because the nature of his injuries was unknown when the release was executed. The trial court rejected Artery's claim that the release should be set aside in entirety due to mutual mistake. However, the trial court agreed with Artery that the release was only valid as...