Insurance companies are ‘victims’ under state restitution law, appeals court says | Courts

The Court of Appeals agreed that the insurance companies were considered “victims” entitled to restitution under state law.

A three-judge panel in the state’s second-highest court interpreted a 2000 law amendment and concluded that the legislature did not intend to prevent insurers from receiving compensation for losses due to criminality. The panel upheld the $2,393.84 restitution that a trial judge ordered Arnold Roman Martinez to pay to his victim and his insurer, GEICO.

“According to Martinez’s reading of the law, violators would have an incentive to target insured victims to avoid paying compensation,” Judge Lino S. Lipinsky of Orlov wrote in notice of March 3. “It defies common sense that restitution laws give a boon to offenders whose victims had the foresight to purchase insurance.”

The panel also rejected Martinez’s argument that the victim was liable for damages caused while trying to recover the bike Martinez stole.

In December 2018, a woman saw Martinez pull a $6,000 bike out of her garage and alerted her husband. The husband, who is the victim in the case, chased Martinez in his car. When Martinez refused to stop, the man pulled his vehicle in front of Martinez, causing Martinez to crash the bike into the car.

A getaway car picked up Martinez and the victim got his bike. While the motorcycle was unharmed, the collision damaged the victim’s car.

Prosecutors charged Martinez with burglary and criminal mischief. Martinez pleaded guilty to a series of cases and did not plead any specific charges for the bike theft. However, the plea agreement allowed prosecutors to seek restitution for the theft. The district attorney’s office asked for $2,393.84 for damage to the car, of which $500 would go to the victim to pay his deductible and the rest would compensate GEICO.

Martinez attempted to avoid paying restitution, arguing that the victim’s actions were responsible for the damages. District Court Judge Judith LaBuda dismissed that claim, explaining that Martinez participated in the collision by stealing the bike.

On appeal, Martinez held that any restitution amount over $500 to the victim was invalid because GEICO was not a victim as the law is currently written. He pointed the definition of “victim” as including anyone “who has suffered losses due to a contractual relationship with, including but not limited to, an insurer…for a person” injured by criminal conduct.

The previous General Assembly definition of victim, enacted in 1985, simply defined the term as a person or entity who suffered loss as a result of a contractual relationship with the person directly affected by a crime. Martinez interpreted the wording change to mean that GEICO could not have a contractual relationship with an insurer because, in fact, it was the insurer.

The Colorado Attorney General’s office felt that this was a misinterpretation of the definition and argued that, overall, it was clear that anyone who suffers losses if they have a contract involving a person harmed by a crime is a victim.

“Consider a case where an offender breaks into a house and steals $10,000 in cash from a house,” Assistant Attorney General John T. Lee wrote to the Court of Appeals. “Under the policy, the insurance company reimburses the victim for the $10,000 stolen. According to the defendant’s reading, the offender would not have to reimburse the $10,000 to the insurer. This result undermines the objectives restitution laws to remove the profit from crime, rehabilitate offenders and deter future crime.”

The panel agreed that the government’s interpretation reflects legislative intent and the general purpose behind requiring defendants to pay restitution. Lipinsky noted that revisions to the law by the General Assembly have served to expand the number of entities entitled to restitution under a contractual relationship, not to reduce it.

Martinez also appealed the finding that he was liable for restitution because he caused the damage. He claimed that the victim’s “dangerous act of self-help” was instead responsible for the accident.

“The collision only happened because (victim) drove off,” wrote Deputy State Public Defender Jacob B. McMahon. He added that neither the State Self-Defense Act nor Citizen’s Arrest Compensation justified the victim’s actions.

“Mr. Martinez committed no crime in his presence and the use of force (by the victim) was unreasonable“, McMahon said.

He also suggested that the victim himself “probably” committed a crime by causing the accident.

The appeals committee rejected those claims, finding that Martinez could have foreseen that the victim would attempt to retrieve his bike.

“It defies logic to claim that once the victim’s car was parallel to Martinez, the victim would simply back up and allow Martinez to get away on the victim’s $6,000 bike,” Lipinsky wrote, adding that the evidence “does not show that the victim intended to collide with Martinez; rather, he expected Martinez to return the stolen bike.”

The deal is People c. Martinez.

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