The Colorado Court of Appeals issued its opinion in Wahrman v. Golden West Realty, Inc. on December 8, 2011.
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.