Chapter 5 - EXHIBIT 5A • SAMPLE COMPLAINT FOR BREACH OF CONTRACT, COMMON LAW AND STATUTORY BAD FAITH BREACH OF INSURANCE CONTRACT, AND DECLARATORY JUDGMENT

• Jurisdiction: Colorado

EXHIBIT 5A • SAMPLE COMPLAINT FOR BREACH OF CONTRACT, COMMON LAW AND STATUTORY BAD FAITH BREACH OF INSURANCE CONTRACT, AND DECLARATORY JUDGMENT

SAMPLE COMPLAINT FOR BREACH OF CONTRACT,COMMON LAW AND STATUTORY BAD FAITH BREACH OF INSURANCE CONTRACT, AND DECLARATORY JUDGMENT¹

Authors' Note: Because these claims may be and regularly are brought in federal court, we are not including the Colorado caption here. PARTIES, JURISDICTION, AND VENUE

1. Plaintiff [name] is, and at all times pertinent to this cause was [a resident of (county) County, (state) OR a (type of business entity) organized under the laws of (state) with its principal place of business at (street address), (city), (state and zip code)].

2. Defendant [name] is, and at all times pertinent to this cause was [a resident of (county) County, (state) OR a (type of business entity) organized under the laws of (state) with its principal place of business at (street address), (city), (state and zip code)]. [If defendant is not a resident of Colorado or organized under Colorado law, it may be necessary to add: Defendant is subject to the jurisdiction of this court pursuant to the Colorado Long-Arm Statute, because (insert applicable reasons under C.R.S. § 13-1-124, such as the transaction of business and/or commission of a tort within this State).]

3. This court has jurisdiction over the subject matter at issue because this is a civil action for damages and/or equitable relief. [Colo. Const. Art. VI, § 9(1), or cite applicable federal basis for jurisdiction, e.g., diversity of citizenship under 28 U.S.C. § 1332.]

4. Venue is proper in this court because [describe basis for venue, including relevant section of C.R.C.P. 98 or 28 U.S.C. §§ 1390, et seq.].

GENERAL ALLEGATIONS

5. [Describe background of Insurance Policy, events, and insurer's breaches, wrongful conduct, etc.]

6. [If plaintiff will be seeking attorney fees incurred in relation to the Insurance Company's wrongful acts and/or plaintiff's efforts to overcome them, state that information and detail how fees were incurred, why fees were incurred, and the amount of the fees.² ]

FIRST CLAIM FOR RELIEF (Breach of Insurance Contract)

7. [Plaintiff] incorporates the foregoing allegations.

8. [Insurance Company] entered into a binding written agreement with [Plaintiff] to provide [type of insurance policy] insurance as described above.

9. [Plaintiff] fully performed its obligations under the Policy by paying premiums in full and on a timely basis. [Plaintiff] has satisfied any conditions precedent to coverage under the Policy, including submission of timely notices.

10. [Insurance Company] has materially breached the Insurance Policy by refusing to perform its obligations under the Insurance Policy. [Material breaches may be specified as desired/required.]

11. The refusal by [Insurance Company] to perform is not excused or justified in any manner.

12. As a result of [Insurance Company]'s breach of its Insurance Policy, [Plaintiff] has been damaged and is entitled to recover damages.

SECOND CLAIM FOR RELIEF (Bad Faith Breach of Insurance Contract)

13. [Plaintiff] incorporates the foregoing allegations.

14. Pursuant to C.R.S. § 10-3-1103, no entity engaged in the insurance business in the State of Colorado may engage in any unfair or deceptive act or practice when conducting the business of insurance.

15. [Insurance Company] may not engage in any unfair or deceptive act or practice when conducting the business of insurance in the State of Colorado.

16. Every contract or policy of insurance contains implied covenants of good faith and fair dealing owed by the insurer to the insured.

17. The Insurance Policy sold by [Insurance Company] to [Plaintiff] contains implied covenants of good faith and fair dealing owed by [Insurance Company] to [Plaintiff].

18. [Insurance Company] owed [Plaintiff] a duty of good faith and fair dealing in connection with [Plaintiff's] request that [Insurance Company] [provide Plaintiff with a defense in the Underlying Action as required] or [settle the claim against Plaintiff in a reasonable and timely manner] or [fully and fairly settle Plaintiff's claim as required] or [provide Plaintiff with all benefits to which Plaintiff is entitled] under the Insurance Policies.

19. Pursuant to C.R.S. § 10-3-1104(1)(h), the following acts or practices, as engaged in by [Insurance Company] in connection with [insert conduct identified in ¶ 12 above], are unfair claim settlement practices:

a. Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue;
b. Refusing to pay claims without

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