A Colorado court of appeals has ruled courts can’t enforce a law that requires insurers to reimburse vehicle registration fees to total loss claimants.

The decision stems from a class action lawsuit brought against LM General Insurance Co. by Barbara Trudgian who paid the one-year registration fee for her vehicle three months before it was deemed a total loss.

Trudgian alleged LM breached its contracts with her and the class members while acting in bad faith and violating state property damage claims practices law.

The district court dismissed all of the allegations on summary judgment.

The appeals court affirmed that judgment and ruled that it’s up to the state’s insurance commissioner to enforce fee payments.

“It [Section 10-4-639(1)] sets out a motor vehicle insurer’s obligation but says nothing about a private civil remedy,” a panel of appeals judges wrote. “We must therefore determine whether the right to one is implied by applying Parfrey.

“The statute at issue required motor vehicle insurers to notify their insureds of the right to purchase uninsured/underinsured motorist (UM/UIM) coverage at the same level as their bodily injury liability coverage… But because the statute did not expressly provide for a private civil remedy, the court had to resolve whether a right to one was implied… The court concluded with the observation that imposing a duty on motor vehicle insurers for the benefit of insureds but preventing those insureds from suing the insurers for breaching that duty ‘would, in all practicality, circumvent this statutorily imposed duty.'”

The judges wrote that the court can’t allow it because the law isn’t clear on whether enforcement implies a private right to sue.

“[T]he supreme court has expressed ‘reluctance’ to find implied private rights of action in the face of legislative silence,” the ruling states. “And the court has explained, somewhat paradoxically, that an implied private right of action requires a ‘clear expression of legislative intent’ to imply one.

“[I]t is not clear to us that the legislature’s grant of these enforcement powers to the commissioner constitutes, for purposes of a Parfrey analysis, a particular administrative remedy… We therefore cannot discern from the grant of these powers any legislative intent to preclude a private right of action (though nothing about the grant of these powers suggests a legislative intent to imply a private right either)… clear legislative intent is what we must have before finding an implied private right of action.”

LM cross-appealed the district court’s ruling arguing which was also dismissed; the judges cited lack of jurisdiction.

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