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Colorado Court of Appeals Opinions
June 7, 2012

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.

2012 COA 89. No. 08CA1374. People v. Herdman.
Sexual Assault—Expert Testimony—Mental Condition—Involuntary Intoxication—Relevance—Lay Witness Testimony—Hearsay—Deadly Weapon.

Defendant Robert Herdman appealed his judgment of conviction for sexual assault, second-degree kidnapping, and a crime of violence sentence enhancer. The judgment was affirmed and the case was remanded with directions.

Herdman contended that the trial court reversibly erred in admitting testimony of the prosecution’s experts. The prosecution called the bond examiner, the competency examiner, and the sanity examiner to testify regarding the cause of Herdman’s psychological problems and mental state. Pursuant to CRS § 16-8-107(1.5)(a), the prosecution is allowed to introduce evidence developed in the course of a court-ordered examination to rebut mental condition evidence introduced by a defendant to show incapacity to form a culpable mental state. Here, the experts’ testimony regarding Herdman’s cocaine use, psychopathy, narcissism, malingering, and lack of empathy and remorse were relevant, were properly offered to rebut his claim of involuntary intoxication, and were not offered to prove bad character. Further, the admission of this testimony did not violate Herdman’s privilege against self-incrimination.

Herdman next contended that the court reversibly erred in allowing the bond examiner to testify, because the bond examiner’s testimony was irrelevant and highly prejudicial, and amounted to evidence of Herdman’s bad character. However, the bond examiner’s testimony did not pertain to Herdman’s state of mind at the time of the offense. Therefore, any error was harmless.

Herdman contended that the trial court reversibly erred in allowing Sergeant Gallegos to testify that (1) Herdman did not serve in Iraq; (2) he did not have post-traumatic stress disorder; and (3) his behavior after his return from overseas was “rebellious.” Although the testimony about Herman’s service in Iraq was inadmissible hearsay, any error was harmless, and the remainder of the testimony was proper.

Herdman argued that the evidence presented was insufficient to support his convictions for sexual assault and the crime of violence sentence enhancer, because there was no evidence that he used a deadly weapon to cause submission of the victim. The prosecution presented evidence that Herdman showed the victim his knife, threatened to cut her if she did not do as he said, ordered her to an apartment, put the knife beside the bed where she could see it, and then sexually assaulted her. Such evidence was more than sufficient to allow a reasonable jury to conclude that Herdman used, possessed, or threatened to use a deadly weapon and that he then used the weapon to cause the victim’s submission to the sexual assault.

Herdman also argued that his sexual assault conviction must merge into his kidnapping conviction because the former is a lesser-included offense of the latter. A sentence enhancer is not a substantive element of an offense for purposes of double jeopardy analysis. Accordingly, Herdman’s double jeopardy argument failed. The judgment was affirmed and the case was remanded to the trial court to correct the mittimus.

2012 COA 90. No. 09CA0246. People v. Rowe.
Child Pornography—Sexual Exploitation—Theories of Liability—Evidence—Closing Argument—CRE 404(b).

Defendant appealed the judgment of conviction entered on a jury verdict finding him guilty of sexual exploitation of a child. The judgment was affirmed.

Defendant’s computer revealed pictures and videos depicting child pornography. Defendant contended that the trial evidence was insufficient to prove that he committed sexual exploitation of a child. A defendant “offers” sexually exploitative material by making it available or accessible to others. Here, defendant knowingly stored files containing sexually exploitative material in a shared folder on a peer-to-peer sharing network on his computer. Such conduct constitutes an offer of sexually exploitative material proscribed by CRS § 18-6-403(3)(b).

Defendant contended that the trial court erred by instructing the jury on other theories of liability listed in the sexual exploitation statute. The evidence provided a sufficient factual basis to support his conviction under the theory that he offered sexually exploitative material. Therefore, it was not error to argue other theories even though they were not supported by sufficient evidence.

Defendant argued that reversal was required because the prosecutor's remarks in closing argument improperly stated the law. Read in context, the prosecutor’s remarks stressed that defendant offered the files and promoted them. Because the evidence was sufficient to prove that defendant offered sexually exploitative material, any of the prosecutor’s statements regarding the term “promotes” did not materially contribute to his conviction.

Defendant next contended that the trial court erred in admitting other acts evidence under CRE 404(b). Testimony of a police officer involving a prior incident where defendant admitted to watching and enjoying child pornography was properly used to prove the issues of intent and motive. Specifically, it was used to rebut any assertion by defendant that there was a mistake of fact or that he did not like child pornography. The trial court also admitted 100 images of animated child pornography found on his computer during the search in this case. This evidence was properly admitted to show lack of mistake of fact, intent, and motive. The probative value of this evidence was not substantially outweighed by the danger of unfair prejudice, and the Court gave a limiting instruction to the jury. Therefore, the trial court did not err in admitting this evidence.

2012 COA 91. No. 09CA2681. People v. Taylor.
Conspiracy to Distribute—Unlawful Search—Challenge for Cause—Entrapment Instruction—Affirmative Defense.

Defendant appealed the judgment of conviction entered on a jury verdict finding him guilty of conspiracy to distribute a schedule II controlled substance. The judgment was affirmed.

Defendant was approached by undercover officers to sell them drugs. Defendant indicated that he did not have any drugs, but he could call someone who did. After defendant made a phone call, a woman showed up and sold the undercover officers $40 of crack cocaine. Both the woman and defendant were arrested, and defendant’s cell phone was seized.

Defendant contended that he was subject to an unlawful search when the police reviewed his cellular telephone’s call log without obtaining a warrant. A search of the contents of a defendant’s cellular telephone or other personal electronic device is a lawful search incident to arrest. Therefore, the search of defendant’s cell phone’s call history was a lawful search incident to arrest, and the trial court did not err in denying defendant’s suppression motion.

Defendant next contended that the trial court abused its discretion in denying his challenge for cause to a prospective juror. After Juror J indicated that he would find defendant guilty based on no evidence, defense counsel challenged Juror J and a second juror for cause, which was denied. The trial court, however, explained the presumption of innocence to the jurors, and the two jurors in question indicated that they could follow the court’s instructions. Therefore, the trial court did not err in denying the challenges for cause.

Defendant further contended that the trial court erred in denying his tendered entrapment instruction based on its conclusion that defendant could not plead the affirmative defense of entrapment because he denied committing the crime. Under Colorado law, entrapment is an affirmative defense. Therefore, a defendant’s denial of wrongdoing precludes an entrapment instruction. Furthermore, the evidence here failed to support such an instruction.

2012 COA 92. No. 11CA0751. McLaughlin v. BNSF Railway Company.
Federal Employers’ Liability Act—Locomotive Inspection Act—Safety Appliance Act—Personal Injury—Negligence—Strict Liability—Eggshell Doctrine—Aggravation Doctrine—Pre-existing Medical Condition—Lost Wages—Collateral Source Rule—Disability Benefits.

Defendant BNSF Railway Company (railroad) appealed the judgment entered and damages awarded after a jury found in favor of its employee, plaintiff Thomas McLaughlin, on his statutory strict liability and negligence claims. The judgment was affirmed.

McLaughlin was injured when a locomotive handbrake allegedly malfunctioned when he attempted to release it. He sued the railroad for negligence and strict liability. The railroad asserted that McLaughlin’s injuries were not caused by the handbrake, and alternatively that the jury should apportion damages because McLaughlin had preexisting conditions that the incident had merely aggravated.

The railroad contended that the district court erred by (1) admitting a transcript of the railroad’s claims agent’s post-incident interview of McLaughlin because it contained hearsay, and (2) denying the railroad’s motion for a new trial based on this admission. The railroad’s counsel offered a page of the transcript to challenge McLaughlin’s testimony about the handbrake tension or pressure, and also more generally challenged his description of the incident and his injuries. Consequently, the entire transcript of McLaughlin’s interview about the incident was admissible as a prior consistent statement to rebut the general charge of fabrication. Alternatively, it was admissible to provide context for McLaughlin’s testimony on cross-examination that he had not reported experiencing tension or pressure in operating the handbrake. Because it was not offered for the truth of the matter asserted, it was not inadmissible hearsay.

The railroad also contended that the district court erred by improperly instructing the jury on the eggshell and aggravation doctrines. The evidence showed that although McLaughlin’s doctors had diagnosed him with pre-existing degenerative disc disease, other age-related deteriorating back conditions, and a pre-existing hernia from his childhood, he had not experienced any symptoms before the incident. The eggshell doctrine can apply in Federal Employers’ Liability Act (FELA) cases involving pre-existing conditions. The aggravation doctrine applies when the pre-existing condition was symptomatic before the incident giving rise to the plaintiff’s claim. The eggshell doctrine instruction was appropriate here because (1) there was no evidence that McLaughlin had suffered any pain or symptoms from his back conditions or hernia before the handbrake incident; and (2) there was evidence that his pre-existing conditions were made symptomatic or exacerbated by the incident. In contrast, the evidence did not support giving the aggravation instruction or the modified verdict form. However, any error was harmless because it was in the railroad’s favor.

The railroad further argued that the district court erred by denying its motion in limine to preclude McLaughlin from presenting evidence of lost wages because of his receipt of Railroad Retirement Act (RRA) disability benefits or to reduce the damages award by the amount of those benefits. RRA payments, such as those received by McLaughlin here, are collateral source benefits and may not be offset against a FELA award. Therefore, the district court did not err in denying the motion in limine.

2012 COA 93. No. 11CA0766. Bittle v. CAM-Colorado.
Adverse Possession—Indispensable Party—Public Roads—Implied Easement of Necessity—CRCP 59(a) and 15(b).

In this adverse possession action, defendant CAM-Colorado, LLC (CAM) appealed those parts of the judgment entered in favor of plaintiffs Dale and Patricia Bittle. The Bittles cross-appealed the district court’s order denying their post-trial CRCP 59(a) motion. The judgment was affirmed in part and reversed in part, and the case was remanded with directions.

The Bittles are a married couple who live on land they also use for farming and grazing livestock. Their land abuts land owned by CAM, a coal company subsidiary. The Bittles initiated a claim for adverse possession, and CAM sought an easement of necessity across the Bittles’ land.

CAM contended that the district court erred in determining that Mesa County was an indispensable party that must be joined before it could determine whether the three roads on the Bittles’ property were public roads. However, the trial court was required to determine whether the roads were dedicated and accepted by the county and, if so, whether those roads had been vacated later or abandoned by the county. Therefore, Mesa County was an indispensable party, because in its absence, the declaration would not be binding on the county and complete relief could not be accorded between the parties.

CAM also contended that the district court erred in denying its request to recognize an implied easement of necessity on the land the Bittles adversely possessed. The person claiming an implied easement of necessity bears the burden of proving such an easement exists at the time the unity of ownership was severed. Here, the Bittles had possessed the land since at least 1977; the latest date by which the severance occurred was 1995. CAM had not pointed to any evidence in the record indicating that, at the time of severance in 1995, it or its predecessors in title were using their land in a manner that would necessitate access through the adversely possessed property. Instead, CAM’s expert stated at trial that the easement was mainly “for future purposes.” Further, evidence in the record proved that there were alternatives offering reasonable means of ingress and egress to CAM. Because CAM did not prove the requirements for an implied easement of necessity, the district court did not err in denying its request to recognize such an easement.

The Bittles contended that the district court abused its discretion in denying their CRCP 59(a) motion to amend the judgment to include a ruling on whether they had adversely possessed the property bordered by the Loma Drain referred to as parcel 4. The Bittles failed to include this claim in their complaint. However, they subsequently filed a timely CRCP 59(a) motion to amend the judgment pursuant to CRCP 15(b). Based on the opening statements, evidence presented, and closing arguments, the parcel 4 issue was actually and intentionally tried by both parties. The record also demonstrates that CAM never objected to the Bittles’ presenting evidence and argument regarding the parcel 4 issue. Accordingly, the court abused its discretion in denying the Bittles’ CRCP 59(a) motion.

2012 COA 94. No. 11CA1249. Chase v. Colorado Oil and Gas Conservation Commission.
Mineral Estate—Designated Outdoor Activity Area—Drilling Permits—Jurisdiction—Colorado Oil and Gas Conservation Commission.

Plaintiffs Laura Chase and Michael Sutak (collectively, landowners) appealed the district court’s judgment affirming orders of defendant Colorado Oil and Gas Conservation Commission (COGCC): (1) declining to interpret the lease between defendants Magpie Operating, Inc. (Magpie) and the Colorado State Board of Land Commissioners (Board); (2) denying landowners’ request to have their property deemed a Designated Outdoor Activity Area (DOAA); and (3) granting a permit to drill for natural gas to Magpie. The judgment was affirmed in part and reversed in part, and the case was remanded for further findings by the COGCC.

In 1997, landowners purchased a 77-acre surface estate in Larimer County, knowing it was subject to a mineral rights reservation. The 1916 patent reserved to the state all mineral rights and “the right of ingress and egress for the purpose of mining together with enough of the surface of [the property] as may be necessary for the proper and convenient working of such minerals and substances.” The Board owns the mineral estate and manages it for the benefit of the School Trust pursuant to the Colorado Constitution.

An irrigation ditch divides the property into two parcels. The south parcel is used for agricultural purposes and also contains a residence, agricultural outbuildings, and an indoor riding arena.

Since 1977, the Board had been a party to an Oil and Gas Lease (lease) over a 640-acre section of land that includes the property. The lease was assigned many times, most recently to Magpie. The first attempt to access the mineral estate occurred in June 2008, when Magpie submitted applications for permits to drill (APD) wells on the property.

Magpie consulted with landowners before submitting its APDs. Landowners contacted the COGCC in December 2007 to request onsite inspection of the property to assist in identifying a drilling site. Consultation and an inspection occurred in 2008, principally to address landowners’ concerns about the potential impact of drilling on their equestrian activities.

After submitting the APDs but before COGCC’s evaluation was completed, landowners applied to have their surface estate declared a DOAA. Magpie and the Board protested. The COGCC evaluation was completed in November 2009 and revealed that the proposed alternative drilling site was outside the drilling window. COGCC staff recommended that the COGCC address the request for a DOAA and, if it was denied, allow drilling on the alternative site. The Board approved the alternative well site on December 12, 2009. The staff also recommended a number of conditions of approval of the APDs.

On February 22, 2010, the COGCC held a hearing on the DOAA request and expressed a number of concerns. It ultimately denied the request by a vote of six to three.

Magpie tried to resolve the conflict with landowners by offering to withdraw the request for one well and to move the other. Landowners responded with multiple additional conditions for the well site. The COGCC granted Magpie’s APD for one well at the location suggested by landowners and approved many of their proposed conditions.

Landowners appealed the denial of the DOAA request, as well as the grant of the permit to drill. The district court affirmed the denial of the DOAA and the grant of the APD. Landowners appealed.

Landowners argued that the COGCC erred in granting Magpie a permit to drill because the lease between Magpie and the Board prohibits Magpie from conducting exploration or drilling operations within 200 feet of any improvement on the property without landowners’ consent. The COGCC determined it lacked jurisdiction to interpret the lease. The Court of Appeal agreed, finding that the COGCC’s interpretation of its Statement of Basis was reasonable and that it limited its jurisdiction, which did not extend to “contracts between surface owners and operators governing surface use.”

Landowners argued that the COGCC erred in denying their DOAA request because the COGCC failed to apply the clear and unambiguous requirements of the DOAA rule. Landowners stated that the rule provides that the subject area be occupied by at least twenty people for forty days or more, but does not require that all the occupants be present at any one time. The Court agreed but found that the COGCC failed to make the necessary factual findings concerning the DOAA request. Accordingly, the case was remanded for detailed findings on whether the property meets the criteria of a DOAA under the COGCC rules.

2012 COA 95. No. 11CA1416. Mesa County Land Conservancy, Inc. v. Allen.
Conservation Easement—Mutual Ditch Shares—Summary Judgment—Injunctive Relief.

In this dispute over a conservation easement encumbering mutual ditch shares, defendants Sam and Susie Allen appealed the trial court’s judgment (1) granting summary judgment in favor of plaintiff Mesa County Land Conservancy, Inc. (Mesa Land Trust); (2) denying the Allens’ motions for summary judgment; and (3) granting injunctive relief in favor of Mesa Land Trust. The judgment was affirmed.

In 1990, the United States, acting by and through the Farmers Home Administration, granted a deed of conservation easement (1990 Easement) to Mesa Land Trust. The conservation easement covered 140 acres of land and provided that “[a]ll water rights held at the date of this conveyance shall remain with this land.” It was recorded in the Mesa County real estate records. At the time of the conveyance, the United States held nine shares of capital stock in a mutual ditch company, the Big Creek Reservoir Company (Big Creek Shares).

The Allens purchased the property in 1993, subject to the 1990 Easement, and their deed specifically referred to the Big Creek Shares. In 2007, the Allens sold the property, but purported to exempt the Big Creek Shares from the conveyance. Mesa Land Trust sought declaratory and injunctive relief against the Allens for violating the terms of the 1990 Easement by attempting to sever the Big Creek Shares from the land.

The Allens filed two motions for summary judgment on grounds that the Big Creek Shares were not encumbered by the 1990 Easement because it did not comply with CRS § 38-30.5-104(5) or with article 8 of Colorado’s Uniform Commercial Code (UCC). Mesa Land Trust moved for summary judgment, seeking a declaratory judgment that the Big Creek Shares could not be exempted from the conveyance. The trial court issued a permanent injunction in favor of Mesa Land Trust, requiring the Allens to convey the Big Creek Shares to the purchasers and prohibiting them from severing them from the property. The Allens appealed.

In 2003, the General Assembly amended certain parts of the conservation easement statutes. The Allens argued that the 1990 Easement is invalid because the definition of “conservation easement” in the relevant statute in effect in 1990 did not authorize encumbrance of water rights; and (2) the 1990 Easement does not comply with the notice requirements of the 2003 amendment of CRS § 38-30.5-104(5). Mesa Land Trust argued that the 1990 Easement is valid because the definition of conservation in the statute in effect when the 1990 Easement was created—the 1976 statute—allowed water rights to be encumbered, and if the 2003 amendment to the notice requirement applies retroactively, it is unconstitutionally retrospective.

The Court of Appeals determined that (1) the statutory language was ambiguous before the 2003 amendments; (2) the legislature intended to clarify, and not to change, the statute; and (3) the statute includes a provision that the 2003 amendment applies to previously created conservation easements. Therefore, the Court held that the legislature intended the statute to apply retroactively. It then considered whether it was unconstitutionally retrospective.

Mesa Land Trust contended that the 2003 amendment is unconstitutionally retrospective solely as to the notice requirement because it impairs Mesa Land Trust’s vested rights in the Big Creek Shares. The Allens responded that Mesa Land Trust does not have any vested rights in the Big Creek Shares because the 1976 statute did not recognize conservation easements encumbering water rights as valid interests in land. The Court disagreed with the Allens, finding that the 1976 statute did authorize the creation of conservation easements encumbering water rights (this was clarified by the 2003 amendment).

The Court also agreed with the trial court that application of the 2003 notice requirement to easements that predated the enactment of that requirement would be unconstitutional. If the requirement were imposed, it would render invalid all pre-existing conservation easements covered by that requirement unless, by chance, a grantor complied with a sixty-day notice provision that did not exist when the easement was created.

Finally, the Allens argued that the Big Creek Shares are securities subject to a previous version of the UCC. The Court rejected this argument, finding that it is well established that the UCC does not apply to mutual ditch shares because they are not corporations in a legal sense but merely vehicles for individual ownership of water rights. Accordingly, the trial court’s judgment was affirmed.

2012 COA 96. No. 11CA1657. Goodman Associates, LLC v. Winter Quarters, LLC.
Priority Between Lienholders—Amended Judgment Lien Versus Deed of Trust.

In this priority dispute between competing lienholders, plaintiff Goodman Associates, LLC (Goodman) appealed the trial court’s order that Goodman’s amended judgment lien does not have priority over a deed of trust given by defendant Winter Quarters, LLC (Winter Quarters) to defendant Capital West National Bank (Capital West) for the purchase price of certain property in Grand County. Goodman also appealed the trial court’s order denying its motion for reconsideration. The judgment was affirmed. 

On October 22, 2008, Goodman filed a complaint in Eagle County District Court alleging claims against WP Mountain Properties, LLC (WPMP) for declaratory judgment and breach of contract arising out of a failed purchase and sale agreement between the parties (Eagle County case). WPMP filed no responsive pleadings and Goodman moved for entry of a default judgment. On December 4, 2008, the Eagle County District Court entered a default judgment. Goodman filed a transcript of the default judgment with the Grand County Clerk and Recorder, which identified a judgment amount of $152,289.98, plus 8% interest “per annum compounded annually from the date of judgment until paid in full,” and a judgment date of December 4, 2008 (December 2008 judgment lien). The transcript of judgment encumbered all real property owned by WPMP in Grand County, including the subject property, Lot 13 within the Lakota Park subdivision.

On January 9, 2009, Winter Quarters purchased Lot 13 from WPMP, financed by a promissory note secured by a deed of trust in favor of Capital West. The deed of trust was recorded on January 23, 2009.

On April 3, 2009, WPMP filed a motion to set aside the default judgment, and Goodman objected. The Eagle County District Court granted WPMP’s motion to set aside the default judgment.

On June 10, 2009, Goodman filed a petition for relief pursuant to CAR 21 with the Colorado Supreme Court, seeking to overturn the order setting aside the default judgment. On January 11, 2010, the Supreme Court issued a rule made absolute granting Goodman’s requested relief and directing the Eagle County District Court to reinstate the default judgment. On February 11, 2010, pursuant to the Supreme Court’s mandate, the Eagle County District Court vacated the order, setting aside the default judgment and directing that the order filed on December 7, 2008 should be reinstated nunc pro tunc.

Goodman filed a motion for an award of attorney fees and costs against WPMP and a supplement thereto in the amount of $134,138.90, plus interest. On June 17, 2012, the Eagle County District Court entered the amended judgment. Goodman recorded the transcript of judgment with the Grand County Clerk and Recorder on July 1, 2010. The transcript identified the judgment amount as $307,081.27 and the judgment date as December 4, 2008, plus 8% post-judgment interest per annum “compounded annually from the date of judgment until paid in full” (July 2010 amended judgment lien).

While the Eagle County case was pending, a foreclosure action involving Lot 13 had been commenced in Grand County. Goodman filed a cross-claim for priority and foreclosure of the July 2010 amended judgment lien. The parties filed cross-motions for determination of a question of law regarding whether Capital West’s interest in Lot 13 was subject to the July 2010 amended judgment lien.

The trial court determined that Capital West had notice of the December 2008 judgment and accrual of interest but not the subsequent litigation that resulted in the July 2010 amended judgment lien. It ruled that Capital West purchased Lot 13 subject only to the December 2008 judgment lien.

On appeal, Goodman argued it was error to conclude that the July 2010 amended judgment lien did not relate back to the December 2008 judgment lien. The Court of Appeals disagreed.

Colorado’s Recording Act is a “race-notice” system. Colorado courts recognize actual notice, constructive notice, and inquiry notice. There was no dispute that Capital West had actual notice of the December 2008 judgment lien, which has priority over Capital West’s deed of trust. The Court found that Capital West did not know nor should have known about the possibility of future litigation between Goodman and WPMP that resulted in the increased July 2010 amended judgment lien.

2012. COA 97. No. 11CA2331. Softrock Geological Services, Inc. v. Industrial Claim Appeals Office.
Unemployment Tax Liability—Covered Employment—Colorado Employment Security Act.

In this unemployment tax liability case, petitioner Softrock Geological Services, Inc. (Softrock) sought review of a final order of the Industrial Claim Appeals Office (Panel) reversing a hearing officer’s decision and concluding that services performed for Softrock by Waterman Guy Ormsby constituted covered employment under the Colorado Employment Security Act (Act), CRS §§ 8-70-101 to 8-82-105. The order was set aside and the case was remanded to the Panel with directions.

Softrock provides geological services in the oil and gas industry. Ormsby is a geologist who provided well site services to Softrock on a project basis from 2007 through 2010 under a written agreement with Softrock. Softrock did not train him. Ormsby used his own vehicle, clothing, tools, and equipment, except for some specialized and expensive laboratory equipment that he rented from Softrock. He had his own business cards, paid his own liability insurance, and did not represent himself to be a Softrock employee.

In March 2011, the Division of Employment (Division) conducted an audit of Softrock and issued a notice of liability, finding that Ormsby was a covered employee for purposes of the Colorado Employment Security Act (Act). The hearing officer reversed the Division’s decision. The Panel agreed that Ormsby had not been under the direction and control of Softrock, but reversed on the ground that Ormsby’s business as a geologist did not survive independently of his relationship with Softrock, because he only worked for Softrock during 2007 to 2010.

On appeal, Softrock argued that the Panel erred by substituting its findings of fact for those of the hearing officer and in using only one factor to hold that Ormsby was not customarily engaged in an independent trade or business. The Court agreed that the Panel improperly based its decision on only one factor and remanded the case with instructions that it look at other factors.

Under the Act, the putative employer must overcome a rebuttable presumption of an employment relationship. Even if the presumption is rebutted, the trier of fact still must determine whether the worker is free from control and direction, and is customarily engaged in an independent trade, occupation, profession, or business related to the service performed.

The determination of whether a worker is engaged in a separate business venture is a multifactor test. Here, it was undisputed that Ormsby provided no services for others between 2007 and 2010. Softrock, however, argued that other factors support its contention that Ormsby was an independent contractor. The Court found that the Panel needed to at least consider and make findings regarding the other factors and could not make its determination just based on the exclusive service relationship during the noted period. It remanded to the Panel for consideration of all factors relevant to Ormsby’s relationship with Softrock.

Colorado Court of Appeals Opinions