Justia Colorado Supreme Court Opinion Summaries

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

Select Energy Services, LLC, wanted to run a water pipeline across an old, partly destroyed irrigation ditch alongside the South Platte River. An easement arising from a water right long associated with that ditch stood in its way. K-LOW, LLC owned the easement, and attempted to block Select’s pipeline as a trespass. Yet, because the water right supporting the easement recently changed, K-LOW’s easement might no longer exist. Whether the easement existed turned on the scope of the underlying water right. Absent that water right, K-LOW’s trespass claim failed. The water court found no right to divert water from the ditch, and the Colorado Supreme Court agreed with its determination. Because, by its plain language, the decree defining the water right allowed its holder to divert water only at the pump downriver from the disputed ditch, the Court concluded the decree did not include a right to divert water from that ditch. View "Select Energy Servs., LLC v. K-LOW, LLC" on Justia Law

Because the plain language of the exculpatory clauses at issue in this case did not limit the homeowner’s association’s liability, and the association, as an entity distinct from internal boards acting as its agents, could not benefit from exculpatory clauses protecting those agents, the Colorado Supreme Court concluded the petitioners could bring their claims against the association. Petitioners Mac McShane and Cynthia Calvin had hoped to build a multistory home overlooking the Roaring Fork Valley. After belatedly discovering their design for that home exceeded county height regulations, they ended up with something less: a one-story home and an attached “pod.” Making the required changes proved costly, and they sued the homeowners association which allegedly improperly approved the architectural plans, then later allegedly improperly denied approval of revised plans. View "McShane v. Stirling Ranch Property Owners Association, Inc." on Justia Law

In 1990, after Denver determined that it needed a new airport, a group of citizens formed the Stapleton Redevelopment Foundation to develop the former Stapleton International Airport. The Stapleton Redevelopment Foundation created a master plan to convert the former airport site. In 1995, the private, nonprofit Stapleton Development Corporation (“SDC”) was formed to lease and sell the former airport property. SDC selected Forest City as the master developer for redevelopment of the property. Forest City sold the vacant residential lot at issue here to a professional home builder, Infinity Home Collection at Stapleton, LLC (Infinity), with whom Respondent/Cross-Petitioner Tad Rogers had contracted to build a home. When Infinity purchased the lot from Forest City, the lot was vacant, did not have utilities, and still needed to be graded to its final configurations. Rogers ultimately purchased the lot and the home from Infinity. The home included a foundation drain system designed to collect ground water into a sump pit and to pump that water into the yard by way of a sump pump. Because of the high water table beneath his house, coupled with calcite leaching from the recycled concrete aggregate base course used to construct the roads, calcite built up in the foundation drain around Rogers' house. In turn, this water and calcite buildup made his basement uninhabitable and caused his sump pump to run and discharge more water. This case presented an issue of whether contractual privity was necessary for a home buyer to assert a claim for breach of the implied warranty of suitability against a developer. The Colorado Supreme Court held that, because breach of the implied warranty of suitability was a contract claim, privity of contract was required in such a case. Here, because the home buyer did not have contractual privity with the developer, he could not pursue a claim against the developer for breach of the implied warranty of suitability. View "Forest City v. Rogers" on Justia Law

This case concerned the relative priority of competing charging orders filed by 15 multiple judgment creditors against a foreign judgment debtor’s membership interests 16 in several Colorado limited liability companies. In July 2013, Chase Bank obtained an Arizona judgment of over $20 million against several defendants, including Reginald Fowler, an Arizona resident. As part of its postjudgment collection efforts, Chase obtained Arizona orders charging Fowler’s membership interests in three Colorado limited liability companies. In March 2014, respondents Douglas McClure, Nancy McClure, and Spiral Broadcasting, L.L.C. (collectively, “the McClures”), obtained a stipulated judgment for $1.5 million against Fowler, among others, in the Arizona Superior Court. In April 2014, the McClures domesticated their Arizona judgment in Colorado, and between May and July 2014, they obtained and served Colorado orders charging Fowler’s membership interests in the LLCs. Now confronted with facially competing charging orders, the LLCs paid Fowler’s then-due distributions into the Colorado District Court registry. That same day, the McClures moved for release of the distribution funds to them, and several days later, Chase sought and obtained leave to intervene and opposed the McClures’ motion. The district court ultimately ordered the distribution funds released to the McClures. Chase then domesticated its Arizona charging orders with a different Colorado District Court, and moved for reconsideration of the release order, arguing that its newly-domesticated charging orders should be deemed effective as of the date they were issued in Arizona and entitled to priority over the McClures’ charging orders. The Colorado Supreme Court concluded first that for purposes of determining the enforceability of a charging order, a membership interest of a non-Colorado citizen in a Colorado limited liability company is located in Colorado. We further conclude that when, as here, a judgment creditor obtains a foreign charging order that compels certain action by a Colorado limited liability company, the charging order is ineffective as against the limited liability company until the creditor has taken sufficient steps to obligate the company to comply with that order. Although the authorities are not uniform as to the steps to be taken, under any of the applicable scenarios, the charging orders obtained by Chase did not become effective until after the respondents had obtained and served competing charging orders. The Court thus concluded that the McClures’ charging orders were entitled to priority over Chase’s competing charging orders. View "JPMorgan Chase Bank N.A. v. McClure" on Justia Law

This case centered on the design and construction of a single-family residence in Pitkin County, Colorado. Heritage Builders, Inc. (“Heritage”) was retained as the general contractor by the original owners of the property, Karen and Courtney Lord. Pitkin County issued a certificate of occupancy for the home in September 2006. In November 2011, Richard Goodman purchased the property from the Lords. Then, sometime between March and June 2012, Goodman discovered the alleged construction defects in the home. Goodman gave Heritage informal notice of his construction defect claims in July 2013. In this original proceeding, the issue presented for the Colorado Supreme Court’s review was whether the statute of repose in section 13-80-104(1)(a), C.R.S. (2016), barred a general contractor’s third-party claims brought in response to a homeowner’s claim for construction defects discovered in the fifth or sixth year following substantial completion of an improvement to real property. The Court held that such claims were timely, irrespective of both the two-year statute of limitations in section 13-80-102, C.R.S. (2016), and the six-year statute of repose in section 13-80-104(1)(a), so long as they are brought at any time before the ninety-day timeframe outlined in section 13-80-104(1)(b)(II). View "In re Goodman v. Heritage Builders" on Justia Law

Ryan Ranch was a residential common interest community. The homeowners association filed a complaint against several low owners abutting Ryan Ranch, seeking past-due assessments, penalties and fees for maintenance and services provided by the association. The issue this case presented for the Supreme Court's review centered on whether the abutting owners owed the fees and penalties when it was discovered the developer inadvertently annexed their lots. In a split decision, the court of appeals determined the lots were not validly annexed because the annexation failed to comply with the Colorado Common Interest Ownership Act. The Supreme Court agreed that the annexation failed for failure to comply with the CCIOA, and affirmed. View "Ryan Ranch Cmty. Ass'n, Inc. v. Kelley" on Justia Law

The Countryside Townhome Subdivision was a residential common interest community. The homeowners association for the Subdivision filed a complaint against the developer, seeking over $400,000 in past-due assessments for maintenance of the developer's unsold properties and related common elements. The developer's liability was implicated when its properties became part of the Subdivision under the community's governing instruments and the Colorado Common Interest Ownership Act. In a split decision, the court of appeals determined that the community was formed when the document containing the community's covenants and the plat were recorded, and that the developer's properties were brought into the community at that time. The Supreme Court, however, disagreed, finding that the mere recordation of the covenants and plat did not create the common interest community. "Rather, the community was created when the developer first subjected the property to the covenants." Because the developer's property could not become part of the community until it was added, and the developer was not otherwise liable for the assessments. View "Pulte Home Corp. v. Countryside Cmty. Ass'n, Inc." on Justia Law

The Department of Transportation petitioned to acquire property owned by Amerco Real Estate Co. and occupied by U-Haul Co. by eminent domain, asserting that the property in question was necessary for a highway expansion project. U-Haul opposed the petition, asserting that the Department lacked authority to condemn its land on grounds that the statutory perquisites for acquiring land in the manner the Department used, were not met. The district court declined to dismiss the petition and instead granted the Department's motion for immediate possession. The Supreme Court reversed, finding that the transportation commission's enabling legislation, to the extent that it purported to delegate to the Department the choice of particular properties to be taken for highway projects and the manner of their taking, was an unlawful delegation of the commission's statutorily imposed obligation. The case was remanded back to the district court for dismissal of the Department's original petition. View "Colorado Dept. of Transportation v. Amerco Real Estate" on Justia Law

Jesse Lipschuetz lived next door to Open Door Ministries. Lipschuetz filed claims against the City of Denver and Open Door looking to revoke a rooming and boarding permit the City granted to Open Door. The trial court concluded the City should not have issued the permit, but stayed revocation until Open Door's cross-claims were resolved. Several months later, the trial court granted summary judgment in favor of Open Door on those cross-claims. On appeal, Lipscheutz argued Open Door's cross-claims against the City were barred by the Colorado Governmental Immunity Act because they "could lie in tort." Therefore, Lipscheutz argued, the trial court lacked jurisdiction over the cross-claims. The court of appeals agreed with that reasoning, and reversed the trial court. The Supreme Court reversed the appellate court, finding that the Colorado Governmental Immunity Act did not apply to Open Door's request for prospective relief to prevent future injury. Because Open Door had not suffered an injury before it filed its cross-claims, the Act did not bar those claims seeking prospective relief from future injury. Therefore, the trial court had jurisdiction over those cross-claims. View "Open Door Ministries v. Lipschuetz" on Justia Law