547 F.

2d 511

AMERICAN EMPLOYERS INSURANCE COMPANY,

Plaintiff-Appellee,
v.
The BOARD OF COUNTY COMMISSIONERS OF the
COUNTY OF ADAMS,
STATE OF COLORADO, Defendant-Appellee,
Stanley Eugene Zierlein et al., Defendants-Appellants,
Employers Mutual Casualty Company, Intervenor-Appellant.
Nos. 75-1004, 75-1005.

United States Court of Appeals,

Tenth Circuit.
Argued and Submitted March 22, 1976.
Decided Dec. 14, 1976.
1

Arthur S. Bowman, Denver, Colo. (Bowman, Shambaugh, Geissinger &

Wright, Denver, Colo., on brief), for defendants-appellants Holman, Zierlein
and Sheets.

Robert R. Montgomery, Denver, Colo. (J. Bayard Young, Montgomery, Little,

Young, Ogilvie, Campbell & McGrew, Denver, Colo., on brief), for intervenorappellant.

Larry W. Berkowitz, S. Morris Lubow, Brighton, Colo., for defendant-appellee

Bd. of County Commissioners.

Albert E. Zarlengo, Jr., Denver, Colo. (John C. Mott, Zarlengo, Mott &
Zarlengo, Denver, Colo., on brief), for plaintiff-appellee American Employers
Ins. Co.

Before LEWIS, Chief Judge, SETH, Circuit Judge, and MORRIS, Chief
District Judge.*

MORRIS, Chief District Judge.

In this case appellants challenge the trial court's determinations with respect to
the liability of an insurer on an insurance policy and the effect of certain
Colorado statutes having to do with sovereign immunity.

Appellee American Employers Insurance Company (American Employers)

brought this declaratory judgment action against all the other parties except the
intervenor to determine its liability under an insurance policy. Appellee Board
of County Commissioners for the County of Adams is the named insured on
the policy. The incident which prompted the declaratory judgment action was
an accident in Adams County in which two vehicles crashed into a creek bed at
a place where bridge approaches had been washed away. Appellants Zierlein
and Sheets allegedly sustained personal injuries in the accident and appellant
Holman, owner of both vehicles, allegedly sustained property damage. The
individual appellants asserted a counterclaim against American Employers and
a cross-claim against the County, asserting that they were entitled to damages
because the accident was caused by the County's negligence. The County, in
answer to American Employers complaint, contended that the policy did cover
the accident. However, the County also asserted a cross-claim against the
individual appellants, contending that if it were determined that the insurance
policy did not cover this accident, then the County would in any event be
immune from liability on the accident by virtue of the doctrine of sovereign
immunity. Appellant Employers Mutual Casualty Company (Employers
Mutual) intervened in the action, filing an answer, counterclaim and crossclaim, asserting subrogation rights as to the claims of the individual appellants.

On November 8, 1974, a non-jury trial was had solely on the two issues of the
existence of insurance coverage and the applicability of the doctrine of
sovereign immunity. In findings of fact and conclusions of law announced from
the bench that same day the trial court found for American Employers and the
County and against the individual appellants and the intervenor, Employers
Mutual. Specifically, the court held, in a judgment entered November 20, 1974,
that American Employers' insurance policy did not provide coverage as to this
accident and American Employers was accordingly not liable on the
counterclaims but that American Employers was nonetheless obligated to
defend the County as to claims for damages arising from the accident. The
court further held that, because of sovereign immunity, the County was not
liable to any of the appellants on their cross-claims.

10

All these holdings, except that as to American Employers' duty to defend, are
challenged by appellants here. Appellants contend that the insurance policy
covered the accident and that, accordingly, both American Employers and the

County are liable. Alternatively, appellants argue that even if there is no

insurance coverage, the County is still liable because the statute purportedly
reserving sovereign immunity as to such county roads, while waiving sovereign
immunity as to other types of roads, is unconstitutional.
11

Appellants' two contentions will be discussed separately. Certain undisputed

facts are material to both issues. On May 6, 1973, there was widespread
flooding in Adams County, Colorado, causing extensive damage. On a county
road, known as Bromley Lane, the flood waters undercut and washed away the
asphalt portions of the approach to a bridge over Sand Creek. The bridge
subsequently collapsed. On May 18, 1973, two vehicles travelling along
Bromley Lane plunged into the creek bed at the site of the washed out bridge
approaches. Appellants sustained personal injuries and property damage as a
result of the accident.

I. Insurance Coverage.
12
13

The Colorado Governmental Immunity Act provides, in relevant part, as

follows:

14 Notwithstanding any provision of law or of this article to the contrary, if a public

(1)
entity provides insurance coverage provided by an insurance company authorized to
do business in this state to insure itself against liability for any injury or to insure any
of its employees against his liability for any injury resulting from an act or omission
by such employee acting within the scope of his employment, then such public entity
shall be deemed to have waived the defense of sovereign immunity in any action for
damages for any such injury insured against, subject to the provisions of subsection
(2) of this section.
15 If the defense of sovereign immunity would be available to a public entity except
(2)
for the provisions of subsection (1) of this section, then damages for injury shall not
be recoverable in excess of the amount of the insurance coverage and shall be
recovered from the insurer only. The insurer shall not be named as a party defendant.
Colo.Rev.Stat. 24-10-104.
16

It is not disputed in this case that if the insurance policy covers the accident, the
doctrine of sovereign immunity does not apply. American Employers admits
that its insurance policy written on the County was in full force and effect on
the day of the accident and that it provided general liability coverage.

17

It is also not disputed that the policy included an endorsement which provides
as follows:

It is agreed that this policy shall not apply to accidents arising out of the existence of
18
county Highways or Roads except those caused by or arising out of and occurring
during the course of street, road or highway construction, reconstruction, repair,
cleaning or snow removal operations by or on behalf of the insured.
19

The trial court held that this endorsement excluded American Employers'
liability as to the accident involved here. Appellants contend that this holding
was erroneous.

20

Appellants argue, first, that this accident arose, not from the "existence" of a
county road, but from the "non-existence" of a county road so that the policy
exclusion predicated on "existence" is not applicable here. Appellants cite us no
authority so construing such a clause. They rely, instead, on cases defining
"existence" as that which actually is or that which is in present force, activity or
effect. In re Harrington's Estate, 151 Neb. 81, 36 N.W.2d 577, 582 (1946); State
v. State Tollbridge Authority, 210 Ga. 690, 82 S.E.2d 626 (1954). They also
rely on a case defining "existing public streets" as those portions of a road
which can be used by the public for the purpose of ordinary travel, as opposed
to the total public right of way. Farina v. Zoning Board of Appeals, 157 Conn.
420, 254 A.2d 492 (1969). Appellants argue that since the bridge approaches
here had washed away and were not usable at the time of the accident, the road
did not exist. American Employers contends, on the other hand, that Bromley
Lane did exist at the time of the accident.

21

In the policy endorsement the term "existence" is used only to distinguish

county-owned land which is devoted to roads from county land which is not
devoted to roads. It is not argued in this case that Bromley Lane had ceased to
be a road and there is no evidence in the record indicating that the road had
been abandoned by the County or that future use of it was not at all times
contemplated. Even those portions of Bromley Lane which were not
immediately usable for transportation remained parts of a road for the purposes
of distinguishing road land from non-road land and, thus, for the purposes of
this policy endorsement.

22

Furthermore, the exclusion is directed at a class of risks those risks arising from
the existence of county roads. In this context the term refers to risks arising
from the fact of or on account of county roads. That these are the excluded
risks is further shown by the fact that accidents arising from affirmative County
activities on the roads are specifically included in coverage. The endorsement
lists as exceptions to the exclusion clause accidents "caused by or arising out of
and occurring during the course of street, road, or highway construction,
reconstruction, repair, cleaning or snow removal operations." The policy

endorsement is clearly intended to exclude coverage as to risks other than these.

In this context, the term "existence" of county roads clearly means "on account
of" or "condition of" or "fact of" county roads.
23

Appellants would interpret "existence" as synonymous with "physical

integrity." Appellants argue, in effect, that if a road is not intact, it has ceased to
exist. Such a reading would make coverage turn on the kind of damage
sustained by the road, a distinction which does not seem intended and which
would lead to irrational results. Under such a reading, for instance, injuries due
to rock slides would be covered if the rock slide carried away a portion of the
road but would not be covered if the rock slide left the road obstructed or
broken but intact. Such distinctions are not inherent in or intended by the use of
the word "existence" in the policy endorsement. A reading of the endorsement
which requires such distinctions is clearly forced and not intended.

24

American Employers contends that it was to just such incidents as this one that
the endorsement was directed. A common sense reading of the endorsement
compels us to agree. The accident alleged in this lawsuit was one arising from
the existence of a county road, as that term is used in the policy endorsement.

25

Appellants further argue that, in any event, the endorsement does not relieve
American Employers of liability in this case because the accident here arose out
of and occurred during the course of construction, reconstruction or repair of
the road. American Employers denies that any of these activities were in
progress at the time of the accident.

26

The facts with respect to the question are not disputed. About two weeks prior
to the accident there had been extensive flooding which caused road and bridge
damage in various parts of Adams County. On Bromley Lane, the road
involved in this case, the approaches to the bridge over Sand Creek were
washed away and the bridge itself eventually collapsed. A number of other
bridges and bridge approaches on Bromley Lane were also damaged by the
flood. Immediately after the flood, the county road supervisor erected warning
barriers on either side of the washout at Sand Creek. Bromley Lane is an eastwest county road, some 26 miles in length. About one mile west of Sand Creek
Bromley Lane is intersected by state highway 79, which is a north-south state
highway. At the time of this accident the damaged bridges on Bromley Lane
west of state highway 79 had all been repaired. The closest repair work was
21/2 miles west of Sand Creek. As of the date of the accident no men or
equipment had been deployed at the Sand Creek site and no plans had been
drawn up or specific decisions made about the nature of the work to be
undertaken at Sand Creek. However, it was acknowledged by road officials that

"something" would have to be done at the Sand Creek crossing and the repair of
the crossing had been discussed.
27

Appellants argue that these facts show that repairs were sufficiently under way
at Sand Creek to invoke the policy endorsement exception with respect to
coverage for accidents arising out of street repairs. American Employers
contends that the exclusion exception for repairs is not applicable because no
repairs had been undertaken at the specific site and so the accident could not
have been caused by and could not have arisen from any such repairs and could
not have occurred during the course of repairs, as required by the exclusion
exception clause. At trial, the dispute focused on whether or not the barriers
erected by the county road supervisor constituted the commencement of repairs
for the purposes of the policy. The trial court found that repairs had not begun
and that, accordingly, no liability attached by virtue of the endorsement
exception.

28

Here, appellants contend that, factually and as a matter of law, the placement of
the warning markers and/or the initiation of repair work on other portions of
Bromley Lane amounted to the commencement of construction, reconstruction
or repair at the Sand Creek site for the purposes of the policy. Appellants
further argue that the trial court's findings as to these questions were findings of
"ultimate facts" or were legal conclusions and so are not insulated from review
by the rule that factual determinations will not be overturned on appeal unless
clearly erroneous. American Employers argues that the evidence shows that no
repairs had actually been undertaken at the Sand Creek location and that the
trial court's determination in this regard was a finding of fact, not assailable on
review unless unsupported by the record. American Employers has not
addressed the question whether the determinations here attacked are questions
of law or fact or "ultimate fact" nor how the distinctions among such
characterizations affect the scope of review. Inasmuch as we agree both with
the findings and conclusions of the trial judge, it is not necessary for us to
explore these distinctions.

29

Appellants argue that the initiation of actual repair work at some places along
Bromley Lane was sufficient to constitute the initiation of repairs as to all the
damaged sites on the road. Appellants contend that "Repairs, that is, actual
physical repairs were underway on the entire length of Bromley Lane and had
progressed east to a point about two and one-half miles to the west of the Sand
Creek site." (Appellants' Brief at 6). They further assert that

30 facts indicate that the entire length of the county highway involved in this
(t)he
accident was under "reconstruction or repair" within the meaning of the policy

language. Barricades had been set up at points of major damage, including the
accident site, and work was proceeding along the length of the route. Though there
is no evidence of reconstruction activity at the bridge at the time of the accident, the
initial steps of repair had already been taken, including inspection, assignment of
repair work, and erection of temporary barricades. The repair work thus begun had
neither ceased nor been suspended at the time of the accident; in fact the accident
site was soon to be repaired and work crews were proceedings (sic) toward it. The
facts indicate that, giving the words "repair" and "reconstruction" their normal
meanings, reconstruction or repair of this site had been commenced at the time of the
accident.
31

In connection with these assertions we note that it does not appear from the
record that any evidence was introduced showing that any work assignments
had been made with respect to the Sand Creek site or that any decisions had
been made with respect to the kind of work to be done there or as to when that
work would occur.

32

It seems to be the gist of appellants' argument that the work on Bromley Lane
was a single project, so that the commencement of repairs at any one spot,
together with the erection of barriers at Sand Creek, served to place the entire
route, and specifically the Sand Creek site, under repair. The trial court found
that there was no single project but, rather, that the work on Bromley Lane and
throughout Adams County involved a series of "spot jobs." The trial judge held
that these several repair efforts were not a "continuous job which hadn't been
worked out." There is evidence in the record to support this finding.

33

The witness Steele, the county road supervisor in that area of Adams County at
the time, was asked, "It was my understanding from your deposition that you
were repairing bridges on Bromley Lane your crews were and you were
progressing eastward from your county line responsibility, somewhere east of
Interstate 80, you were going eastward?" The witness replied, "And we did." He
also testified that at the time of the accident repair work had been undertaken
within 21/2 miles west of the Sand Creek bridge. However, the witness did not
testify that a single work project had been drawn up with respect to continuous
west-to-east repairs of Bromley Lane, with the whole route under systematic
progressive repair. On the contrary, it is the thrust of the witness' testimony that
the county road crew regarded the work as a series of spot jobs, aimed at
eventually repairing all the flood-damaged roads in that sector of Adams
County, but organized on a job-by-job, not a road-by-road priority basis. The
efforts to repair this damage did not involve beginning repairs on Bromley Lane
and continuing steadily, west to east along the Lane, until the road was
completely passable. Indeed, the witness testified that the crew was working in

an overall fashion to fix washed out bridge approaches throughout the area, that
some of these washouts were on Bromley Lane, that by the day of the accident
all the bridge approaches west of the Sand Creek bridge had been worked on,
but that once Bromley Lane was open from the west to state highway 79,
further eastward work had not been pursued but that "we had moved to State or
to County Highway 24, because it does traverse the County from east to west,
the entire distance; and I had some 160 barricades out. We were trying to
establish a priority basis to benefit all of the people." (Tr. 29-30). We have been
directed to no evidence other than Mr. Steele's testimony on this point and we
have found none.
34

The record clearly supports the trial court's finding that this was not a single,
continuous project, and we accept that finding. We also agree with the trial
judge's conclusion that when the initiation of repairs does not amount to the
commencement of a systematic road project, then the commencement of some
such repair efforts along a particular road does not constitute the
commencement of repairs as to all sites along the route. The fact that some of
the bridges along Bromley Lane had been repaired at the time of the accident
does not mean that repairs had commenced as to the Sand Creek site.

35

Nor did the erection of barricades on either side of Sand Creek amount to the
commencement of repairs. The witness Steele was asked, "And in your mind,
was a barricade serving as a function both to warn people of the bridge being
out and also as the stage of road reconstruction that would have to be done later
on?" Steele replied, "At the time it was placed, it was for the purpose of
protecting the public and to try to shut the road off." There is no evidence in the
record that any other activity took place at the site or that the barricades were
erected with the intent of initiating construction, reconstruction or repairs. The
trial court found that the barriers were set up as warning devices, that their
erection was not accompanied by any other activity or any repair efforts on the
part of the County, and that, accordingly, the erection of the warning markers
did not constitute the initiation of construction, reconstruction or repair. The
record supports the finding and we accept it. We further agree with the trial
court's determination that the erection of warning signs, without more, does not
constitute the initiation of repairs. In this connection, we note that the case
cited by appellants for the proposition that the placing of barricades constitutes
repair was a case in which the barrier was set up in connection with actual,
simultaneous repair work and the issue was not whether the erection of the
barricade marked the commencement of repairs but whether the geographical
location of the barricade was close enough to the actual repair efforts to be
included as a part of those efforts. Lemon v. Commonwealth, 236 Mass. 599,
129 N.E. 382 (1911).

36

In this case, the barriers were set up on May 6, 1973. As of the date of the
accident, May 18, 1973, the County had done nothing at that site to make the
road passable. Appellants show us no case in which the erection of barricades,
without further work or commitment of resources, has been held to constitute
the commencement of construction, reconstruction, or repairs. Nor have we
been cited any case in which the presence of barriers was held to establish that
construction, reconstruction, or repair were in progress. The trial court noted,
and we agree, that it is a matter of common knowledge that traffic barriers are
frequently stationed at places where no repair work is under way or even
contemplated. The placement of barriers alone does not, as a matter of law,
amount to the commencement of repairs for the purposes of this endorsement
exclusion.

37

Nor does the fact that the necessity of repair was recognized establish that
repairs had commenced, for the purposes of the policy endorsement. The
witness Steele testified that he knew from the outset that "something would
have to be done" about the bridge approaches and that higher officials had held
some discussion as to whether the bridge could be rebuilt. But there is no
evidence in the record even suggesting that concrete plans had been drawn up
or decisions made as to the nature, timing, or logistics of work on the Sand
Creek bridge. Appellants have cited us no case for the proposition that
discussions about the necessity of repairs or even recognition of a commitment
ultimately to undertake repairs constitutes commencement of repairs,
particularly for the purposes of an insurance policy which requires that the
accident occur during the course of repairs.

38

As a matter of law, no construction, reconstruction or repair, within the

meaning of the policy, was commenced by the recognition of the necessity of
repair, the discussion of same, the commencement of actual physical repairs at
other sites along the road and the erection of warning barricades. The policy
endorsement plainly covers only those accidents arising from activities actually
directed at on-going construction, reconstruction or repair work at the place
where the accident occurs. All of the facts relied upon by appellants taken
together do not show that construction, reconstruction or repair were under way
at the Sand Creek location.

39

Nor are we persuaded by appellants' argument that the terms "arising from" and
"during the course of" are to be liberally construed. The cases cited by
appellant liberally construing the term "arising from" are all workmen's
compensation cases involving a determination whether a particular injury was
sustained in the scope of employment. Appellants have not persuaded us that a
liberal interpretation is similarly appropriate as to an insurance contract limiting

coverage to construction, reconstruction or repairs or that such interpretation

would in any event so expand the definitions of construction, reconstruction or
repair as to include the situation at the Sand Creek site. Appellants also cite
cases broadly construing what is meant by the phrase "during the course of,"
but these cases are not relevant here where it has been determined that no
construction, reconstruction or repair had even begun.
40

Finally, appellants contend that the policy endorsement is ambiguous and

accordingly must be construed against the insurer. The endorsement is not
ambiguous and the court is not forced to resort to rules of construction in order
to understand it. Given an ordinary and plain reading the policy does not cover
this accident.

II. Sovereign Immunity.

41
42

Appellants also argue that even if the insurance policy provides no coverage,
the County is still subject to suit because the Colorado statute upon which the
County relies for its claim of sovereign immunity is unconstitutional.

43

The Colorado statute, 24-10-104, set forth above waives sovereign immunity
as to insured risks. A following section of the Colorado statutes, 24-10-106,
specifies other situations in which sovereign immunity is waived. Section 2410-106 provides, in relevant part, as follows:

44 A public entity shall be immune from liability in all claims for injury which are
(1)
actionable in tort, except as provided otherwise in this section. Sovereign immunity,
whether previously available as a defense or not, shall not be asserted by a public
entity as a defense in an action for damages for injuries resulting from:
45 A dangerous condition which interferes with the movement of traffic on the
(d)
traveled portion and shoulders or curbs of any public highway, road, street, or
sidewalk within the corporate limits of any municipality, or of any highway which is
a part of the federal interstate highway system or the federal primary highway
system, or of any paved highway which is a part of the federal secondary highway
system, or of any paved highway which is a part of the state highway system or that
portion of such highway, road, street, or sidewalk which was designed and intended
for public travel or parking thereon. . . .
46

The Colorado Governmental Immunity Act, 24-10-108, then provides:

47
Except
as provided in sections 24-10-104 and 24-10-106, sovereign immunity shall
be available to a public entity as a defense to an action for injury.

48

The County argues that county roads are not included among those roads as to
which sovereign immunity is waived by 24-10-106(d) and that, accordingly,
in the absence of insurance coverage, sovereign immunity exists as to Bromley
Lane, which is a county road.

49

Appellants argue that 24-10-106(d) is unconstitutional because it infringes

the constitutional right to travel and because it violates the equal protection
clause. Appellants contend that 24-10-106 should be "held unconstitutional as
applied, and this invalid application should be severed" from the Colorado
Governmental Immunity Act. Appellee County argues that even if the
severance were granted it would not avail appellants. The County points out
that even if 24-10-106 were struck down in its entirety, the County would
have immunity under 24-10-108, which reserves sovereign immunity except
as waived in 24-10-104 (dealing with the effects of a government entity's
securing insurance coverage) and 24-10-106. The County further points out
that even if only subsection (d) is struck from 24-10-106, the County remains
immune as to this accident, because the effect of striking subsection (d) would
be, not to extend the waiver of immunity to county roads but, rather, to rescind
the waiver as to the roads described in subsection (d).

50

We agree. Even if the section or subsection were declared unconstitutional the

County's sovereign immunity here would be unaffected. Section 24-10-108
provides that sovereign immunity is an available defense to public entities sued
for injury in Colorado. It is not disputed in this case that the County is a public
entity entitled to sovereign immunity. Section 24-10-106 waives sovereign
immunity as to certain occasions and causes of injury, but in 24-10-106 the
waived situations are listed as exceptions to the basic rule that "A public entity
shall be immune from liability in all claims for injury which are actionable in
tort . . .." C.R.S. 24-10-106. If any particular subsection were removed from
the list of exceptions in 24-10-106, the effect would be to leave sovereign
immunity intact as to the occasion or causes of injury enumerated in that
subsection. Thus, the excision of 24-10-106(d) would not extend the waiver
of sovereign immunity to this accident. Moreover, even if the entire section
were struck down, sovereign immunity would be preserved by virtue of 2410-108. The County has sovereign immunity in this action.

51

Thus, the validity of 24-10-106 is not material to this lawsuit. The only issue
before us is whether the County has sovereign immunity. Appellants have not
sought declaratory or injunctive relief with respect to the constitutionality of
24-10-106. Appellants' cross-claims allege only actions in tort and seek only
money damages. A determination of the constitutionality of 24-10-106 is not
necessary to a determination whether the County has sovereign immunity as to

these tort claims. The County has such immunity, whether 24-10-106 is
constitutional or not. Appellants seek no relief which requires a determination
of the section's constitutionality and we do not decide the question.
52

Affirmed.

Of the Eastern District of Oklahoma sitting by designation