April 26, 2017

Archives for October 31, 2016

Colorado Court of Appeals: Donor and Transferee Are One Entity for Conservation Easement Tax Credit Purposes

The Colorado Court of Appeals issued its opinion in Medved v. Colorado Department of Revenue on Thursday, October 20, 2016.

Conservation Easement Tax Credit—Statute of Limitations—Notice of Disallowance.

The Medveds purchased a conservation easement (CE) tax credit from Whites Corporation (Whites). The appraised value of the tax credit was $130,000. Whites was the CE donor and the Medveds were the CE transferees. On October 23, 2006, the Medveds filed their 2005 Colorado tax returns and claimed a $130,000 credit based on the CE. On October 30, 2007, Whites filed a Colorado State C Corporation income tax return and claimed a $260,000 credit based on the same CE.

On March 4, 2011, the Colorado Department of Revenue (Department) issued a notice of disallowance to Whites and the Medveds, disallowing the credit in its entirety. The Medveds appealed to the district court and argued the notice of disallowance was barred by the four-year statute of limitation in C.R.S. § 39-21-107(2). The Department argued that the Medveds and Whites were subject to the same statute of limitations that was triggered when the donor filed its tax return under C.R.S. § 39-22-522(7)(i). The district court found that the donor and the transferee were a single entity and were bound as to all issues concerning the tax credit to the four-year statute of limitations, which was triggered by the donor’s tax claim. Because Whites filed its return on October 30, 2007, the Department’s notice of disallowance was within the statute of limitations.

On appeal, the Medveds claimed they were not bound by the same statute of limitations as Whites. The court of appeals agreed with the Department that a donor and transferee are considered a single entity under the statute and are bound by the same statute of limitations. The Medveds also argued that the first claim filed triggers the four-year statute of limitations. Finding the statutory language ambiguous, the court considered its legislative intent and purposes and concluded that the General Assembly intended that the first claim filed, either by the donor or transferee, begins the four-year statute of limitations period. Because the Department’s notice of disallowance was beyond the four-year limitations period, the Department’s disallowance was untimely and statutorily barred.

The judgment was reversed and the case was remanded for dismissal.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Construction Defect Claims Filed Against Subcontractors were Time-Barred

The Colorado Court of Appeals issued its opinion in Sopris Lodging, LLC v. Schofeld Excavation, Inc. on Thursday, October 20, 2016.

Construction Defect—Summary Judgment—Time Bar.

TDC was the general contractor for construction of a hotel owned by Sopris Lodging (Sopris). On March 11, 2011, Sopris sent TDC a notice of claim regarding alleged construction defects at the hotel. On May 24, 2013, Sopris filed a complaint in district court asserting construction defect claims against one of the subcontractors of the hotel and against TDC’s individual principals, who had guaranteed TDC’s performance. On the same date, Sopris and TDC entered into an agreement to toll the statute of limitations for Sopris’s claims against TDC.

In 2014, TDC filed third-party claims against several subcontractors including Schofield and CEC for breach of contract, negligence, contribution, and indemnification. CEC and Schofield moved for summary judgment, asserting the claims were barred by the two-year statute of limitations in C.R.S. § 13-80-102. TDC did not dispute that the claims accrued on or before March 11, 2011 but argued C.R.S. § 13-80-104(1)(b)(II) tolled the statute of limitations for a defendant’s third-party clams until 90 days after a settlement or final judgment on the plaintiff’s claims against the defendant. The district court entered summary judgment in favor of CEC and Schofield.

On appeal, Sopris (standing in the shoes of TDC following a settlement and assignment of the third-party claims) argued it was error to find the claims time-barred. C.R.S. § 13-80-104(1)(b)(II) gives a contractor the option to bring indemnity or contribution claims against subcontractors in a separate lawsuit after the underlying claims are resolved and tolls the statute of limitations for such claims. But because TDC asserted third-party claims in the original construction defect litigation, the tolling section does not apply. Thus TDC’s third-party claims were time barred.

The judgment was affirmed.

Summary provided courtesy of The Colorado Lawyer.

Tenth Circuit: Unpublished Opinions, 10/28/2016

On Friday, October 28, 2016, the Tenth Circuit Court of Appeals issued two published opinions and one unpublished opinion.

United States v. Zander

Case summaries are not provided for unpublished opinions. However, some published opinions are summarized and provided by Legal Connection.