Justia Colorado Supreme Court Opinion Summaries

Articles Posted in Legal Ethics

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Robert Feldman ("Feldman") and the law firm of Haddon, Morgan & Foreman petitioned for relief from a probate court order requiring the firm to provide information to the special administrator concerning its representation of Feldman in a criminal prosecution for the murder of his wife Stacy, and to deposit funds held in its client trust account into the registry of the court. In response to the assertion by the special administrator that Colorado’s “slayer statute” applied to the funds at issue as proceeds of the decedent’s life insurance policy, the probate court determined that if Feldman were later found, in the manner prescribed by the statute, to be the decedent’s killer, he would be ineligible to receive those proceeds. Against that eventuality, the probate court found that compelling the return of the unearned funds in the firm’s client trust account would be the only way to protect the children’s interests, and that the court’s equitable powers permitted it to do so. The Colorado Supreme Court determined the probate court abused its discretion by issuing its order without weighing the considerations inherent in preliminarily enjoining the law firm from expending further funds in the representation of Feldman. In addition, however, because the slayer statute expressly protected third parties who receive a payment in satisfaction of a legally enforceable obligation from being forced to return that payment or from liability for the amount of the payment, no finding of a reasonable likelihood of success in attempting to force the return of the insurance proceeds would have been possible. Given this resolution, the Supreme Court found the disclosures ordered by the probate court would not have served their intended purpose. View "In re Feldman" on Justia Law

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T.T. sought to ensure that his name was not linked to the record of his earlier short-term commitment for treatment of a mental health condition. Under section 27-65-107(7), C.R.S. (2018), when a person is released from short-term treatment for a mental health condition, the clerk of the district court shall seal the record in the case and omit the name of the person from the court’s “index of cases.” The key question in this case was whether “Eclipse,” the user interface of the Colorado judicial branch’s computerized case management system, was an “index of cases” as contemplated by section 27-65-107(7). The Colorado Supreme Court concluded the reference to “index of cases” in section 27-65-107(7) contemplated a list of matters before the court that could be used to locate the actual court records for those matters. The Eclipse user interface itself contained no data, and neither Eclipse nor its underlying database, ICON, functioned as an “index” or list of cases. Thus, contrary to the court of appeals’ ruling, section 27-65-107(7) did not require the court clerk to remove T.T.’s name from the ICON/Eclipse case management system. Moreover, to remove an individual’s name from this case management system would thwart the court’s statutory obligations to link the record of a short-term mental health case with subsequent cases involving that individual and to share certain information with the federal government. Because the district court cannot comply with the relief directed by the court of appeals, the Supreme Court discharged the rule to show cause. View "In re People in the Interest of T.T." on Justia Law

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Francis Ruybalid committed numerous ethical violations arising out of cases that he either prosecuted or supervised while he was the District Attorney for the Colorado Third Judicial District. He argued he was entitled to the attorney’s fees and costs he incurred while defending these allegations. The counties of the Third Judicial District refused to reimburse Ruybalid for these expenses. The Colorado Supreme Court determined that because Ruybalid’s ethical violations were at times committed recklessly or knowingly, his attorney’s fees and costs were not necessarily incurred in the discharge of his official duties, therefore, he was not entitled to reimbursement for fees. View "Ruybalid v. Bd. of Cty. Comm'rs" on Justia Law

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David Calvert was disbarred for various ethical violations, including entering into an oral agreement with a client without complying with the requisite safeguards of Colorado Rule of Professional Conduct 1.8(a). After being disbarred, Calvert sued his former client, Diane Mayberry, for breach of that same oral agreement, claiming that there was a contract between them. The trial court granted Mayberry’s motion for summary judgment, and the court of appeals affirmed. On appeal to the Colorado Supreme Court, Calvert challenged: (1) whether an attorney who was found to have violated Rule 1.8(a) in a disciplinary proceeding was estopped from relitigating the same factual issues in a civil proceeding; (2) whether a contract between an attorney and a client entered into in violation of Rule 1.8(a) was enforceable; and (3) whether the trial court abused its discretion in awarding attorney’s fees against Calvert after finding his lawsuit groundless and frivolous. The Colorado Supreme Court declined the issue preclusion issue raised because Calvert conceded he could not relitigate whether he entered into an agreement with a client without meeting Rule 1.8(a)’s requirements. The Court held that when an attorney enters into a contract without complying with Rule 1.8(a), the contract was presumptively void as against public policy; however, a lawyer may rebut that presumption by showing that, under the circumstances, the contract does not contravene the public policy underlying Rule 1.8(a). Further, the Court held the trial court did not abuse its discretion in awarding attorney’s fees at the trial level because the record supported the finding that the case was groundless, frivolous, and brought in bad faith. But as to attorney’s fees at the appellate level, because the questions of whether issue preclusion applied in this proceeding and whether a contract made in violation of Rule 1.8(a) is void as against public policy were legitimately appealable issues, thereby making a grant of appellate attorney’s fees inappropriate. Therefore, the Supreme Court affirmed the court of appeals as to the merits on other grounds, affirmed the award of attorney’s fees at the trial level, and reversed the court of appeals’ order remanding for a determination of appellate attorney’s fees. View "Calvert v. Mayberry" on Justia Law

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In a judicial disciplinary proceeding, the Colorado Supreme Court considered the exceptions of now-former Colorado Court of Appeals Judge Laurie Booras to the Colorado Commission on Judicial Discipline’s (the “Commission’s”) recommendation that Judge Booras be removed from office and that she be ordered to pay the costs incurred by the Commission in this matter. The Commission’s recommendation was based on the factual findings and conclusions of law set forth in the December 12, 2018 Report of the Special Masters in this case. That report concluded that Judge Booras had violated Canon 1, Rule 1.2, Canon 3, Rule 3.1, and Canon 3, Rule 3.5 of the Colorado Code of Judicial Conduct by (1) disclosing confidential information belonging to the court of appeals (namely, the vote of a court of appeals division on a case prior to the issuance of the decision in that case) to an intimate, non-spousal partner and (2) using inappropriate racial epithets in communications with that intimate partner, including a racially derogatory reference to a court of appeals colleague. Judge Booras filed exceptions to the Commission’s recommendation, contending that her communications with her then-intimate partner were protected by the First Amendment and that the recommendation that she be removed from office was too severe under the circumstances of this case. In addition, by letter dated January 2, 2019, Judge Booras advised the Chief Justice that she was resigning her position as a Colorado Court of Appeals Judge, effective as of the close of business on January 31, 2019, although no party contended Judge Booras’s resignation rendered this matter moot. Having now considered the record and the briefs of the parties, the Supreme Court concluded the Commission properly found Judge Booras’s communications with her then-intimate partner were not protected by the First Amendment. Furthermore, given Judge Booras’ resignation, which she tendered and which became effective after the Commission made its recommendation, the Court did not decide whether Judge Booras’s removal from office was an appropriate sanction. Rather, the Court concluded the appropriate sanction in this case was acceptance of Judge Booras’s resignation, the imposition of a public censure, and an order requiring Judge Booras to pay the Commission’s costs in this matter. View "In the Matter of Laurie A. Booras" on Justia Law

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In 2009, Della Gallegos had to undergo three cranial surgeries after her radiologist, Dr. Steven Hughes, failed to detect an obvious brain tumor on an MRI scan three years earlier. Had Dr. Hughes discovered the tumor in 2006, Gallegos could have treated it with cheaper, and less invasive, radiosurgery. The highly invasive cranial surgeries damaged Gallegos’s vision, hearing, and memory. Gallegos retained attorney Patric LeHouillier to sue Dr. Hughes for medical malpractice. But LeHouillier later decided not to proceed with the suit, concluding it did not make economic sense. He and Gallegos disagreed over whether he actually informed her of this decision, and the statute of limitations lapsed on the claims Gallegos could have brought against Dr. Hughes. Gallegos thereafter brought this attorney malpractice case against LeHouillier and his firm, claiming that LeHouillier’s negligence prevented her from successfully suing Dr. Hughes for medical malpractice. The question before the Colorado Supreme Court involved who bore the burden to prove that any judgment that could have been obtained against Dr. Hughes would have been collectible. The Supreme Court concluded that because the collectibility of the underlying judgment was essential to the causation and damages elements of a client’s negligence claim against an attorney, it held the client-plaintiff bore the burden of proving that the lost judgment in the underlying case was collectible. Here, the record reflected Gallegos failed to present sufficient evidence of collectibility. However, given the absence of a clear statement from the Supreme Court regarding plaintiff's burden to prove collectibility at the time of trial, and because the issue was not raised in this case until after Gallegos had presented her case-in-chief, the Court reversed the court of appeals and remanded for a new trial. View "LeHouillier v. Gallegos" on Justia Law

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At issue in this appeal was a district court’s order compelling production of a recording of petitioner Kayla Fox’s initial consultation with her attorney. The district court determined that the recording was not subject to the attorney-client privilege because her parents were present during the consultation and their presence was not required to make the consultation possible. Further, the district court refused to consider several new arguments Fox raised in a motion for reconsideration. The Colorado Supreme Court concluded the presence of a third party during an attorney-client communication ordinarily destroys the attorney-client privilege unless the third party’s presence was reasonably necessary to the consultation, unless another exception applies. On the facts of this case, the district court did not err when it found that Fox had not shown the requisite necessity to preserve her claim of privilege. Nor did the district court abuse its discretion in declining to consider Fox’s new arguments raised for the first time in her motion for reconsideration. View "In re Fox v. Alfini" on Justia Law

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This case arose from a series of transactions in which petitioners Rocky Mountain Exploration, Inc. and RMEI Bakken Joint Venture Group (collectively, “RMEI”) sold oil and gas assets to Lario Oil and Gas Company (“Lario”). In the transaction, Lario was acting as an agent for Tracker Resource Exploration ND, LLC and its affiliated entities (collectively, “Tracker”), which were represented by respondents Davis Graham & Stubbs LLP and Gregory Danielson (collectively, “DG&S”). Prior to RMEI’s sale to Lario, RMEI and Tracker had a business relationship related to the oil and gas assets that were ultimately the subject of the RMEI-Lario transaction. The RMEI-Tracker relationship ultimately soured; Tracker and Lario reached an understanding by which Lario would seek to purchase RMEI’s interests and then assign a majority of those interests to Tracker. Recognizing the history between Tracker and RMEI, however, Tracker and Lario agreed not to disclose Tracker’s involvement in the deal. DG&S represented Tracker throughout RMEI’s sale to Lario. In that capacity, DG&S drafted the final agreement between RMEI and Lario, worked with the escrow agent, and hosted the closing at its offices. No party disclosed to RMEI, however, that DG&S was representing Tracker, not Lario. After the sale from RMEI to Lario was finalized, Lario assigned a portion of the assets acquired to Tracker, and Tracker subsequently re-sold its purchased interests for a substantial profit. RMEI then learned of Tracker’s involvement in its sale to Lario and sued Tracker, Lario, and DG&S for breach of fiduciary duty, fraud, and civil conspiracy, among other claims. As pertinent here, the fiduciary breach claims were based on RMEI’s prior relationship with Tracker. The remaining claims were based on allegations that Tracker, Lario, and DG&S misrepresented Tracker’s involvement in the Lario deal, knowing that RMEI would not have dealt with Tracker because of the parties’ strained relationship. Based on these claims, RMEI sought to avoid its contract with Lario. Lario and Tracker eventually settled their claims with RMEI, and DG&S moved for summary judgment as to all of RMEI’s claims against it. The district court granted DG&S’s motion. The Colorado Supreme Court granted certiorari to consider whether: (1) Lario and DG&S created the false impression that Lario was not acting for an undisclosed principal (i.e., Tracker) with whom Lario and DG&S knew RMEI would not deal; (2) an assignment clause in the RMEI-Lario transaction agreements sufficiently notified RMEI that Lario acted on behalf of an undisclosed principal; (3) prior agreements between RMEI and Tracker negated all previous joint ventures and any fiduciary obligations between them; (4) RMEI stated a viable claim against DG&S for fraud; and (5) RMEI could avoid the Lario sale based on statements allegedly made after RMEI and Lario signed the sales agreement but prior to closing. The Supreme Court found no reversible error and affirmed. View "Rocky Mountain Exploration, Inc. and RMEI Bakken Joint Venture" on Justia Law

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Defendants sought ex parte interviews with a number of non-party medical providers in this medical malpractice action. Because of this, an issue arose regarding the scope of the physician–patient privilege in medical-malpractice actions. Section 13-90-107(1)(d), C.R.S. (2017), prohibited certain medical providers from revealing, in testimony or otherwise, information about a patient gathered in the course of treating that patient. That prohibition, however, was not unlimited. The dispute, as presented to the Colorado Supreme Court, did not implicate the physician–patient relationship between Kelley Bailey (“Bailey”) and Defendants, meaning section 107(1)(d)(I) was inapplicable. Instead, the issue here was whether the non-party medical providers were “in consultation with” Defendants such that section 107(1)(d)(II) removed that typically privileged information from the protection of the physician–patient privilege. The Supreme Court held the non-party medical providers were not in consultation with Defendants for the purposes of section 107(1)(d)(II). However, the Court remanded this case to the trial court for consideration of whether the Baileys impliedly waived the physician–patient privilege for the non-party medical providers. On remand, if the trial court concluded that the Baileys did waive that privilege, it should reconsider whether there is any risk that: (1) ex parte interviews with the non-party medical providers would inadvertently reveal residually privileged information; or (2) Defendants would exert undue influence on the non-party medical providers in the course of any ex parte interviews. View "In re Bailey v. Hermacinski" on Justia Law

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In a construction-defect matter filed by a homeowners’ association (HOA) against several developers, an attorney for the HOA previously represented one of the developers. The developers moved to disqualify that attorney under Rules 1.9 and 1.10 of the Colorado Rules of Professional Conduct. The trial court denied the motion, without what the Colorado Supreme Court described as “meaningfully analyzing for purposes” of Rule 1.9 whether this case was “substantially related” to the prior matters in which the attorney represented the developer. Instead, the Court found the trial court relied on issue preclusion, and found that in this situation, the attorney was not disqualified to represent the developer. The Supreme Court concluded the trial court erred by not analyzing the facts of this case under Rule 1.9, and therefore vacated the denial of the developers’ motion, and remanded for further proceedings. View "In re Villas at Highland Park Homeowners Assoc. v. Villas at Highland Park, LLC" on Justia Law