Colorado Court of Appeals Opinions
December 8, 2011
|The Court of Appeals summaries are written for the Colorado Bar Association by licensed attorneys Teresa Wilkins (Denver) and Paul Sachs (Steamboat Springs). Please note that the summaries of Opinions of the Colorado Court of Appeals are provided as a service by the Colorado Bar Association and are not the official language of the Court. The Colorado Bar Association cannot guarantee the accuracy or completeness of the summaries.|
No. 09CA1400. People v. Poage.
Defendant appealed the judgment of conviction entered following a bench trial finding him guilty of two counts of failure to register as a sex offender (second offense). The judgment of conviction was vacated.
Defendant was required to register as a sex offender. On January 10, 2008, he completed an annual registration form with Adams County, listing 410 Washington Avenue as his current home address. On January 23, 2008, a deputy attempted to verify defendant’s residence and found the home vacant. During a bench trial, defendant testified that he had been living with his mother at the address listed on his annual registration form but that the property had been foreclosed. Defendant testified that he slept at friends’ houses and in his car and that his belongings were in storage. He stated that he did not complete a new form with Adams County because he had no address.
On appeal, the People contended that CRS § 18-3-412.5(1) incorporates the entirety of title 16, article 22; therefore, defendant’s actions must be analyzed under CRS § 16-22-108(4)(a). However, when the People elected to proceed under CRS § 18-3-412.5(1)(g) and (i), they abandoned their arguments under CRS § 18-3-412.5(1)(a). Accordingly, their argument failed.
Defendant contended that the prosecution did not present sufficient evidence to support his conviction, because it failed to establish that he no longer resided in the jurisdiction. The plain language of the statute is clear and unambiguous, requiring a sex offender to file a cancellation form with the law enforcement agency of the jurisdiction in which the person will no longer reside. Therefore, defendant was not required to file a cancellation of registration form because he did not leave Adams County and the People failed to present any evidence demonstrating that he did so.
No. 10CA1024. Beaver Creek Property Owners Association, Inc. v. Bachelor Gulch Metropolitan District.
42 U.S.C. § 1988—Attorney Fees—State Law Claims—Relation Back Doctrine.
Defendant Bachelor Gulch Metropolitan District (Bachelor Gulch) appealed the district court’s orders awarding attorney fees and costs under 42 U.S.C. § 1988 to two groups of plaintiffs, namely, Beaver Creek Property Owners Association, Inc. (Beaver Creek) and Strawberry Park at Beaver Creek Property Owners Association, Inc. and certain of its owners (collectively, Strawberry Park). The order was affirmed in part and reversed in part.
When Vail/Arrowhead, Inc. (Vail) began developing the Strawberry Park subdivision, it agreed not to route any of its construction traffic through the Beaver Creek subdivision. Instead, Vail sent all of its construction traffic over a road in the neighboring community of Bachelor Gulch. In April 2006, Bachelor Gulch enacted a road regulation that effectively banned Strawberry Park subdivision construction traffic from its roads.
On appeal, Bachelor Gulch argued that the district court erred in awarding Strawberry Park its attorney fees, because Strawberry Park’s constitutional claims were not sufficiently “substantial.” When a party joins state law and constitutional claims but prevails only on the state law claims without deciding the constitutional claims, a court still may award attorney fees under 42 U.S.C. § 1988 if the constitutional claim was substantial and the state law claim arose from a common nucleus of operative facts. Here, Strawberry Park was required to establish that the traffic regulation at issue and the classification that it allegedly established lacked a rational relationship to a legitimate governmental purpose. There was a substantial evidentiary record in which both sides presented evidence tending to support their respective positions. In light of this record, and fully recognizing that a plaintiff seeking to invalidate a regulation on rational basis grounds faces an uphill battle, it is not apparent that Strawberry Park’s constitutional claims were “obviously without merit,” as Bachelor Gulch contended. Accordingly, Strawberry Park’s constitutional claims were sufficiently substantial to warrant an award of attorney fees under § 1988.
Bachelor Gulch also contended that the district court erred in awarding attorney fees to Beaver Creek because Beaver Creek did not add its § 1983 claims until after the district court had granted partial summary judgment for plaintiffs. The relation back doctrine may not be used to create a post hoc basis for an award of attorney fees under § 1988. Therefore, Beaver Creek improperly relied on the relation back doctrine to establish, after the fact, a basis for seeking attorney fees. Accordingly, the district court erred in awarding Beaver Creek attorney fees in connection with constitutional claims that were filed after the court granted partial summary judgment for plaintiffs. This judgment was reversed.
No. 10CA1453. Kisselman v. American Family Mutual Ins. Co.
CRS §§ 10-3-1115 and -1116—Prospective Application—Bad Faith Claim.
Plaintiff David Kisselman appealed the district court’s order, pursuant to C.R.C.P. 56(h), holding that CRS §§ 10-3-1115 and -1116 were inapplicable in this action against defendant American Family Mutual Insurance Company (American Family). The order was reversed and the case was remanded with directions.
Kisselman was injured in a car accident caused by an underinsured driver. At the time of the accident, Kisselman was covered by an American Family insurance policy that included uninsured/underinsured motorist and umbrella coverage up to $1.1 million. Kisselman settled with the uninsured driver, filed a lawsuit against American Family to avoid having his legal claims barred by the statute of limitations, and proceeded to arbitration with American Family to determine Kisselman’s past and future damages stemming from the car accident. American Family subsequently paid the amount awarded by the arbitrator for these damages to Kisselman.
Kisselman argued that the district court erred in finding that CRS §§ 10-3-1115 and -1116 were inapplicable. CRS § 10-3-1115(1)(a) provides that an insurer “shall not unreasonably delay or deny payment of a claim for benefits owed.” CRS § 10-3-1116(1) provides that a first-party claimant (such as Kisselman) also may bring an action for a breach of the statutory duty set forth in CRS § 10-3-1115 to recover reasonable attorney fees, court costs, and “two times the covered benefit.” The Court of Appeals found that (1) the statutes create a new private right of action in addition to and different from common law bad faith claims; (2) the statutes announce a standard of liability different from the standard of liability for common law bad faith claims; and (3) the General Assembly intended the statutes to apply prospectively to all post-effective date conduct of insurers, regardless of when the original claim for benefits was made. Therefore, CRS §§ 10-3-1115 and -1116 do apply prospectively to alleged post-effective date acts of unreasonable delay by American Family, and the district court erred in ruling that they were inapplicable in this case.
No. 10CA1665. Reigel v. SavaSeniorCare L.L.C.
Wrongful Death—Negligence—Duty of Care—Agents—Causation—Outrageous Conduct Claim—Punitive Damages—Amended Complaint—Noneconomic Damages—Evidence.
In this wrongful death action, defendants SSC Thornton Operating Company, L.L.C., doing business as Alpine Living Center (Alpine); SavaSeniorCare, L.L.C. (SSC), Alpine’s parent company; and SavaSeniorCare Administrative Services, L.L.C. (Administrative Services) appealed the verdicts in favor of the victim’s surviving spouse, Janis M. Reigel. The victim’s surviving sons, Brent Reigel and Bradley Reigel, cross-appealed the district court’s directed verdict in defendants’ favor on their claims and its award of costs to defendants for those claims. The judgment was reversed in part and vacated in part, and the case was remanded for a new trial on plaintiffs’ negligence claim against Alpine.
Dennis Reigel died shortly after being taken to a hospital emergency room from a nursing facility owned by Alpine. The court directed a verdict in defendants’ favor on the sons’ claims. The jury found in Ms. Reigel’s favor on her negligence and outrageous conduct claims, awarding her $450,000 in damages.
SSC and Administrative Services (collectively, the Sava Defendants) contended that the district court erred in denying their motion for directed verdicts on the negligence claim. Ms. Reigel did not establish that they owed a duty of care to Mr. Reigel because she did not present evidence to establish that Alpine’s employees were the Sava Defendants’ agents.
Alpine contended that the evidence was insufficient to support a jury finding of causation in connection with the negligence claim. The district court erred by giving the jurors an incorrect test for causation, which was a lower burden of proof than the “but-for” causation test, and this error was not harmless. Further, Alpine was not entitled to a directed verdict on the negligence claim because the evidence would have been sufficient to support a verdict under the correct test.
Defendants contended that the district court erred in denying their motion for directed verdicts on Ms. Reigel’s outrageous conduct claim. Though there is evidence that Alpine’s employees were abrupt, irresponsible, and lacking in sensitivity in responding to Ms. Reigel’s requests for help, the evidence was not sufficient to support an outrageous conduct claim.
Defendants also contended that the district court erred in allowing Ms. Reigel to recover punitive damages because the court abused its discretion in permitting Ms. Reigel to amend her complaint to request punitive damages shortly before trial. After the Reigels moved three times to compel discovery from defendants, after the substantial completion of discovery, and after establishing a prima facie proof of a triable issue, the court did not abuse its discretion in allowing the Reigels to amend their complaint.
The sons cross-appealed the district court’s directed verdict in defendants’ favor on the wrongful death claim and its award of costs to defendants for that claim. A wrongful death action involves a shared injury among survivors such that there is no individualized recovery of damages, because all damages awarded are owned jointly and distributed through the statutes of descent and distribution. Therefore, whatever noneconomic damages Ms. Reigel established were owned by the sons as well, and the sons were not required to prove these separately.
No. 10CA1853. Janicek v. Obsideo, LLC.
Foreclosure—Redemption—Homestead Rights—Waiver—Deed of Trust—Junior Lienholder—Mootness—Standing—Equitable Estoppel—Unclean Hands—Judicial Estoppel.
In this action seeking payment of excess proceeds tendered at a public trustee foreclosure sale, plaintiffs Anthony and Pamela Janicek (collectively, homeowners) appealed the trial court’s orders in favor of defendants Obsideo LLC and 1502 Forrestal, LLC (collectively, Obsideo) and Snavely Development Company (Snavely). Snavely cross-appealed the trial court’s denial of its request for attorney fees. The orders were affirmed.
Obsideo argued that homeowners’ appeal is moot. Here, the public trustee disbursed the excess proceeds to Obsideo. Because homeowners could obtain a judgment against Obsideo for the amount of the proceeds in the event they prevailed, their claim was not moot.
Homeowners contended that the second deed of trust contractually placed their homestead rights in a superior position to the lien secured by that instrument. Homeowners argued that they were entitled to the excess proceeds because, in the second deed of trust, Obsideo waived its right under CRS § 38-41-212(1) to take the property free of their homestead rights. A contractual waiverof homestead rights in a deed of trust constitutes a waiver as to all junior lienholders, and any junior lienholder redeeming the property takes it free and clear of any homestead rights. Therefore, Obsideo, as a junior lienholder, was entitled to take the property free of any homestead rights because it redeemed pursuant to foreclosure of the first deed of trust, and the second deed of trust did not waive or nullify the application of CRS § 38-41-212(1).
Homeowners also contended that Obsideo failed to comply with the redemption procedures set out in the statute and, accordingly, that the certificate of redemption must be struck and the excess proceeds distributed to them. The winning bidder, however, accepted the late redemption payment, and homeowners can claim no homestead rights pursuant to foreclosure of the first deed of trust because they waived their homestead rights in that instrument. Accordingly, they have no claim to the excess proceeds and can assert no injury. Therefore, the trial court did not err in holding that homeowners lacked standing to challenge Obsideo’s redemption.
Homeowners asserted that the equitable doctrines of (1) equitable estoppel, (2) unclean hands, and (3) judicial estoppels bar Obsideo from receiving the excess proceeds. However, equitable estoppel and unclean hands are equitable defenses and not offensive theories of recovery, and judicial estoppel does not apply because homeowners did not contend that Obsideo took inconsistent positions in related court proceedings. Accordingly, none of the three doctrines affords homeowners a theory of recovery against Obsideo.
No. 10CA2349. Thyssenkrupp Safway, Inc. v. Hyland Hills Parks and Recreation District.
Directed Verdict—Breach of Contract—Indemnity—CRS § 24-91-103.6(4).
In this action for breach of contract based on an indemnity provision, plaintiff Thyssenkrupp Safway, Inc. (Safway) appealed the judgment in favor of defendant Hyland Hills Parks and Recreation District (Hyland Hills). The judgment was affirmed.
Hyland Hills is a Colorado Special District and owns a water park known as Water World. In May 2006, the general manager of Water World authorized his assistant general manager, Gary Maurek, to locate a scaffolding company to assist in accessing a light fixture atop a tall pole that was misaligned. One of the companies contacted was Safway.
Safway’s assistant construction manager visited the premises and was asked to provide a quote for the scaffolding services. A quote in the form of a proposed contract was faxed to Maurek later that day. It included an indemnification provision. Maurek prepared a summary of the proposed cost and gave it to his general manager, who then passed it along to the executive director of Hyland Hills. The executive director approved the expenditure of approximately $1,800 but did not give anyone authority to sign a contract. Maurek nonetheless signed Safway’s contract form as “assistant general manager.”
During erection of the scaffolding, the light fixture fell on Safway’s employee, causing him to fall and sustain serious injuries. Safway paid workers’ compensation benefits and then commenced this action seeking indemnification from Hyland Hills.
Following a two-day trial, Hyland Hills moved for a directed verdict, which the trial court granted. The trial court found that Safway had failed to prove Maurek had any authority to sign the contract. It also held that the claim was barred by CRS § 29-1-110(1), which essentially voids any contracts made by a local government that involve expenditures of money in excess of appropriated amounts.
On appeal, Safway argued that it met the requirements of CRS § 24-91-103.6(4) through its presentation of sworn testimony at trial, which should have precluded Hyland Hills from relying on CRS § 29-1-110(1) as a defense. The Court of Appeals disagreed. CRS § 24-91-103.6(4) provides an exception under certain circumstances applicable to a “public works contract,” which is defined in CRS § 24-91-103.5(1)(b). The Court noted that a motion for directed verdict should be granted only if the evidence compels the conclusion that reasonable jurors could not disagree and that no evidence or inference was received at trial on which a verdict against the moving party could be sustained.
Here, it was undisputed that as a special district, Hyland Hills is a local government, and that it had not budgeted any funds during the period 2006 to 2010 to reimburse Safway for any workers’ compensation benefits. The Court also held that the contract at issue was a public works contract and that the indemnity provision was a remedy-granting provision that would trigger the exception.
However, the Court rejected Safway’s argument that the trial testimony under oath by its director of risk management regarding the amounts Safway had paid to or on behalf of its injured employee met the requirement of a “statement sworn to under the penalty of perjury” setting forth “[t]he amount of additional compensation to which [it] contends that it is entitled,” “that claim-supporting data which is accurate and complete to the best of [Safway’s] knowledge and belief have been submitted,” and “that the amount requested accurately reflects what is owed by” Hyland Hills. The plain language of the statute requires the foregoing sworn statement be “submitted to the public entity” not to the trial court. The Court found it clear that this must happen sometime before trial. The judgment was affirmed.
No. 11CA0461. Mid-Century Insurance Co. v. Robles.
Summary Declaratory Judgment—Automobile Insurance Policy.
Claimant appealed from the trial court’s summary declaratory judgment determining that there was no coverage for an accident under an automobile insurance policy issued by plaintiff Mid-Century Insurance Company (Mid-Century). The judgment was affirmed.
On January 21, 2008, an automobile accident occurred between claimant and the tortfeasor. At the time, the tortfeasor was living with his parents and driving his father’s Oldsmobile, which was insured by Farmers Insurance Exchange (Farmers). The tortfeasor’s parents were the named insureds. The tortfeasor owned a Ford Explorer insured by Mid-Century.
Claimant sustained injuries in the accident and filed a lawsuit against the tortfeasor. The parties reached a partial settlement and claimant received $100,000 from Farmers pursuant to the policy limits.
Mid-Century instituted this action for a declaration regarding coverage. Both parties filed motions for summary judgment. The trial court granted Mid-Century’s motion, concluding that the Oldsmobile was not an “insured car” under the policy and that the “regular use” or “drive other car” exclusion did not violate public policy. It also excluded coverage under the anti-stacking provision of the Mid-Century policy.
On appeal, claimant argued that the trial court misinterpreted the policy exclusion. He contended that the exclusion did not apply because the tortfeasor did not regularly use the Oldsmobile. The Court of Appeals disagreed, finding this to be a misinterpretation of the insurance contract language, which clearly barred coverage by Mid-Century of the tortfeasor’s use of his father’s vehicle. The Court noted that excluding coverage for a family member’s use of a car that another family member owns and is separately insured is not uncommon.
The Court then considered whether the Oldsmobile qualified as an “insured car” under the Mid-Century policy. The only way it could so qualify was if it were a replacement vehicle. Because this term was not defined in the Mid-Century policy, the Court looked to the common meaning of “replacement” to determine whether the Oldsmobile was a replacement vehicle for claimant’s Explorer. The Court held that it was not a replacement vehicle under this definition and, therefore, the Oldsmobile was not insured by Mid-Century.
No. 11CA0588. Sheep Mountain Alliance v. Board of County Commissioners, Montrose County.
C.R.C.P. 106(a)(4)—Special Use Permit.
Plaintiff Sheep Mountain Alliance (SMA) appealed the judgment denying its request for relief under C.R.C.P. 106(a)(4) from a resolution of defendant Montrose County Board of County Commissioners (Board), conditionally granting Energy Fuels Resources Corporation (Energy Fuels) a special use permit (SUP) to operate a uranium and vanadium mill and tailings disposal facility within the county. The judgment was affirmed.
In March 2008, Energy Fuels introduced a plan to construct a uranium and vanadium ore processing mill and disposal facility in the Paradox Valley of southwestern Colorado. It filed an application with the Board in July 2008 for the Piñon Ridge Project as a special use within the general agricultural district in which the project was to be located.
The county hired an engineering consultant to review and opine on Energy Fuels’ hydrology data. In March 2009, the consultant reported to Steve White, the county planner, that the proposed wells would fall “pitifully short” of the water supply needed for full operation of the project.
In response, Energy Fuels procured a commitment from the town of Naturita for additional water rights, planned to construct two additional wells, and amended its application to reduce by half its daily processing rate. Based on these changes, the consultant submitted a new opinion to White that water quantity and quality would be sufficient for operation of the mill at 500 tpd of ore.
White issued a staff report to the Planning Commission in May 2009, advising that the Piñon Ridge Project constituted a permissible special use under the Montrose County Zoning Resolution (Zoning Resolution). Public hearings were held on May 19, June 10, and July 1, 2009. The hearings were recorded and minutes were kept.
As a result of the hearings, White added sixteen conditions to his staff report and on July 1, 2009, the Planning Commission recommended approval with the conditions. The Board held two public hearings on the application, and then closed the public hearing but advised the public it could submit written comments until a final decision was made.
The Board held a work session on September 28, 2009 with county staff and on September 30 approved Resolution No. 98-2009 granting Energy Fuels a SUP to construct and operate the Piñon Ridge Project conditioned on nineteen enumerated conditions.
SMA sought review of the Board’s decision under C.R.C.P. 106(a)(4). The trial court affirmed and SMA appealed.
Under C.R.C.P. 106(a)(4), a trial court’s review of an agency’s judicial or quasi-judicial decision is “limited to a determination of whether the body or officer has exceeded its jurisdiction or abused its discretion, based on the evidence in the record before the defendant body or officer.” SMA first argued that the Board abused its discretion because it did not record and prepare minutes of three public hearings related to the SUP. The Court of Appeals disagreed, finding that, based on the record, these were not public hearings. It also found that the work session held relating to the SUP was not a public hearing that needed to be recorded.
SMA contended that the Board abused its discretion in classifying the Piñon Ridge Project as an authorized, listed special use in a general agricultural district. The Court disagreed. The record clearly supported the Board’s finding in this regard.
SMA maintained that the Board erred because the Piñon Ridge Project involves the on-site disposal of hazardous waste in violation of the Zoning Resolution. The Court disagreed, finding that uranium and vanadium tailings from the proposed mill were not “hazardous waste” within the meaning of the Zoning Resolution.
Finally, SMA argued that it was an abuse of discretion for the Board to permit Energy Fuels to operate at a maximum annualized (as opposed to daily) average rate of processing ore. The Court disagreed. The record clearly supported the Board’s consideration of this issue and reasoned decision in regard to it. The judgment was affirmed.
No. 11CA2231. Wahrman v. Golden West Realty, Inc.
Interlocutory Review—C.A.R. 4.2.
Barbara Wahrman petitioned for interlocutory review of the district court’s order that the economic loss rule barred her breach of fiduciary duty and negligence claims against defendants Golden West Realty, Inc. and Kathleen Smith. The petition was denied.
Defendants acted as Wahrman’s broker in leasing and managing her residential rental property. According to Wahrman, the tenants significantly damaged the property during and in connection with the termination of the tenancy. She alleged defendants were liable because they obtained an adverse credit report on the tenants but failed to inform Wahrman, inspected the property but failed to note the damage, consented to violations of the lease, and advocated on the tenants’ behalf.
On defendants’ Motion for Determination of Question of Law, the trial court requested briefing on the economic loss rule and then held that it barred the breach of fiduciary duty and negligence claims. It then granted Wahrman’s Motion for Interlocutory Appeal without making any findings.
C.A.R. 4.2 allows an interlocutory appeal when (1) immediate review may promote a more orderly disposition or establish a final disposition of the litigation; (2) the order from which an appeal is sought involves a controlling question of law; and (3) the order from which an appeal is sought involves an unresolved question of law. The Court of Appeals found that whether the economic loss rule applies to claims regarding the duties a residential broker owes to a landlord appeared to be a question of first impression in Colorado and, therefore, assumed it was an unresolved question of law.
However, the Court found nothing to suggest why the economic loss question is a controlling question of law in this case. The petition could have been denied for this reason alone. The Court also found that the assertion that immediate review may support more orderly disposition based on the specter of retrial and attendant additional cost was not a reason that would support interlocutory review. The petition was denied and the appeal was dismissed.
Colorado Court of Appeals Opinions