January 22, 2017

Colorado Court of Appeals: Probate Court Had Jurisdiction to Appoint Temporary Co-Guardians

The Colorado Court of Appeals issued its opinion in In the Interest of L.B. on Thursday, January 12, 2017.

Probate—Child—Subject Matter Jurisdiction—Guardianship—Home State.

L.B.’s mother died and her father, Berzins, hired Dusalijeva as L.B.’s nanny. Later, they developed a romantic relationship. Berzins had and L.B. has dual citizenship in the United States and Latvia. Berzins died in 2015 in Denver. He had two wills: a 2012 Will executed in Latvia, and a 2014 Will executed in Denver. The 2014 Will expressly revoked all prior wills and left the residuary estate in trust for the benefit of L.B. and Blumberg (Berzins’s other daughter) or Blumberg’s descendants.

In March, May, and July 2015, the court appointed Dusalijeva and Blumberg as temporary co-guardians, initially at their request. In April 2015, without informing the Denver Probate Court, Dusalijeva moved for sole guardianship of L.B. in Latvia. After a four-day hearing, the Denver probate court appointed Blumberg and a Latvian couple, the Carlins, as permanent co-guardians of L.B. in August 2015. Ultimately, the Latvian appellate court found that Dusalijeva and her attorney had attempted to deceive the Latvian orphan’s court by relying on the superseded 2012 Will and failing to inform the court of the 2014 Will, and it concluded that matters regarding L.B. should be determined by a U.S. court.

On appeal, Dusalijeva primarily contended that the probate court lacked subject matter jurisdiction. First, she contended that the court lacked jurisdiction under C.R.S. § 15-14-204(5) and (1) on the three occasions it temporarily appointed her and Blumberg as co-guardians. Based on the Colorado Court of Appeals’ review of the record, the court had jurisdiction under C.R.S. § 15-14-204(5). The probate court also had jurisdiction under C.R.S. § 14-13-204(1) because L.B. had been “abandoned” within the meaning of the statute.

Dusalijeva next contended that the probate court lacked permanent subject matter jurisdiction pursuant to C.R.S. § 14-13-204(2). Subsection (2) is arguably inapplicable in this case because the court did not say that its temporary orders appointing co-guardians would become permanent. Instead, the court held a hearing in August 2015 to determine independently who should be L.B.’s permanent guardian. The court did not decide this issue because it found the probate court had jurisdiction under C.R.S. § 14-13-201.

Dusalijeva also appeared to contend that the probate court lacked subject matter jurisdiction to determine permanent guardianship under C.R.S. § 14-13-201(1). The probate court properly exercised subject matter jurisdiction because Colorado was found to be L.B.’s home state. Further, even if Latvia had adopted a provision in substantial conformity with C.R.S. § 14-13-201(1)(a), the Latvian courts declined to exercise jurisdiction, ruling that Colorado was a more appropriate forum.

The court also considered and rejected six other alleged errors by the probate court and declined to address several arguments that Dusalijeva raised for the first time in her reply brief.

The orders were affirmed.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Tractor is Motor Vehicle for Underinsured Motorist Coverage Purposes

The Colorado Court of Appeals issued its opinion in Smith v. State Farm Mutual Automobile Insurance Co. on Thursday, January 12, 2017.

Insurance—Covered Motor Vehicle—Underinsured Motorist Provision—Farm Tractor.

Bunker was driving a farm tractor when he collided with Smith’s truck. The hay spears attached to the tractor pierced the truck and impaled Smith, leaving him severely injured. Bunker pleaded guilty to careless driving, and Smith settled his claim against Bunker for Bunker’s liability policy limits. Because this settlement did not fully compensate Smith for his injuries, he filed a claim for underinsured motorist benefits (UIM) with State Farm Mutual Automobile Insurance Co. (State Farm). State Farm denied coverage on the basis that a farm tractor is not a motor vehicle. Smith sued and the district court dismissed the complaint, finding that the tractor was not a covered motor vehicle for purposes of the UIM coverage policy.

On appeal, Smith contended that his policy’s property damage coverage section definition of “uninsured motor vehicle” is included in the UIM coverage provision. The Colorado Court of Appeals declined to extend the “uninsured motor vehicle” definition found only in the property damage coverage provision beyond that provision.

Smith next contended that the plain and ordinary meaning of “motor vehicle” includes the tractor. The court determined that the plain and ordinary meaning is an automotive vehicle not operated on rails and one with rubber tires for use on highways. Applying this definition, the court found that the tractor had wheels and its own motor, was not operated on rails, and was designed for use on streets and highways. Therefore, it was a covered motor vehicle under Smith’s UIM coverage provision.

The judgment was reversed and the case was remanded.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Terms of Settlement Offer were Valid and Enforceable When Accepted

The Colorado Court of Appeals issued its opinion in Kovac v. Farmers Insurance Exchange on Thursday, January 12, 2017.

Personal Injury—Underinsured Motorist—Statute of Limitations—Summary Judgment.

Kovac was seriously injured in a car accident with Filipelli. It was undisputed that Filipelli was at fault. Kovac’s medical expenses exceeded $1.4 million. Filipelli was covered by Shelter Insurance Company (Shelter) with a liability limit of $100,000. Kovac was insured under two different automobile policies with Farmers Insurance Exchange (Farmers).

Kovac settled with Shelter for its policy limits. Later, Farmers offered to settle Kovac’s remaining claims for $80,000, but the parties could not reach a settlement. Kovac sued Farmers on April 3, 2015 for recovery of UIM benefits, tortious bad faith breach of contract, and unreasonable delay and denial of insurance benefits. Farmers moved for summary judgment on the grounds that the Shelter settlement check was tendered to Kovac’s attorney on April 2, 2013 and the statute of limitations therefore ran on April 2, 2015. The district court agreed and dismissed the suit.

On appeal, Kovac argued that although her attorney received the check and settlement offer on April 2, it was not accepted until April 5 when the release was signed and the check endorsed. Therefore, the statute of limitations ran on April 5, 2015 and her complaint was timely filed on April 3, 2015. C.R.S. § 13-80-107.5(b) provides that the statute of limitations runs two years from the date when the insured “received payment of the settlement” on the underlying bodily injury claim. The court of appeals determined that Kovac released her claims against Filipelli on April 5, 2013.  Therefore the statute of limitations had not run when she filed her complaint against Farmers.

The summary judgment was reversed and the case was remanded.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Time Frame for Appeal of Paternity Determination Arises from C.A.R. 4

The Colorado Court of Appeals issued its opinion in People in Interest of N.S. on Thursday, January 12, 2017.

Dependency and Neglect— Juvenile Court Jurisdiction—Paternity Adjudication.

The El Paso County Department of Human Services (the Department) filed a dependency and neglect petition on behalf of N.S. The mother’s boyfriend was listed as respondent-father, and the child was placed with him. At a pretrial conference, the juvenile court found that the boyfriend had not been adjudicated the child’s legal father and therefore ordered genetic paternity testing. The juvenile court adjudicated N.S. dependent and neglected. The Department subsequently amended the petition to list A.C. as respondent-father. A.C. was confirmed to be the biological father through genetic paternity testing. Following a paternity hearing, the juvenile court adjudicated A.C. as the child’s legal father.

Boyfriend appealed and the Colorado Court of Appeals issued an order to show cause why his appeal should not be dismissed pursuant to the time frames of C.A.R. 3.4(b)(1). Boyfriend responded that his appeal was governed by C.A.R. 4(a). The court ordered the parties to brief (1) whether the notice of appeal was due within 21 days of the date of the final, appealable order under C.A.R. 3.4; and (2) whether the juvenile court had jurisdiction to issue the judgment of paternity in a dependency and neglect proceeding.

The court first concluded that the plain language of C.A.R. 3.4 shows that the rule does not apply to paternity actions. C.A.R. 4 does not list specific orders that are appealable, and in the absence of any limiting language, its 49-day time frame applied.

The court then stated that the juvenile court has exclusive original jurisdiction in dependency and neglect proceedings to determine parentage. But when a paternity issue arises in these proceedings, the juvenile court must follow the Uniform Parentage Act (UPA) procedures. Here, both presumptive fathers were parties to the proceeding, had actual notice that a legal finding of paternity was necessary, and did not object to the juvenile court deciding the matter. Accordingly, the juvenile court had subject matter jurisdiction under the UPA.

The judgment was affirmed.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Denial of Attorney Fees Not Error in Close Case with No Vexatious, Groundless Claims

The Colorado Court of Appeals issued its opinion in In re Estate of Fritzler on Thursday, January 12, 2017.

Wills—Business Records Exception—Jury Instruction—Presumption of Undue Influence—Attorney Fees—Costs.

Fritzler and his wife executed numerous wills during the last 10 years of their lives. The last will was drafted just a few years before they each passed away. In all of the wills, the Fritzlers sought to distribute their farm in a generally equitable manner among their five children, but the last will increased son Glen’s portion over son Steven’s portion. Steven contested the will, contending that Glen unduly influenced Fritzler. After a lengthy trial, a jury concluded that the will was valid. Following the verdict, the estate and the personal representative (PR) sought attorney fees and costs. The court denied the award of fees, finding that the case was “close” and Steven did not lack substantial justification. The court partially denied costs, concluding that it lacked equitable authority to grant fees without concurrent statutory authority.

On appeal, Steven contended that the trial court abused its discretion by excluding Fritzler’s hospital medical records because they were admissible under the business records exception. Although the exclusion was an abuse of discretion, any error was harmless because the records were cumulative of other admitted evidence.

Steven also contended that the trial court erred by refusing to instruct the jury on the presumption of undue influence. However, the PR offered sufficient evidence to rebut this presumption. Thus it would have been improper for the court to instruct the jury thereon.

The PR contended that the trial court erred by denying her request for attorney fees under C.R.S. § 13-17-102 and by denying her certain costs as the prevailing party under C.R.C.P. 54(d). The trial court noted that this was a close case and found that even though Steven did not prevail, his claims were not groundless, frivolous, or vexatious. Therefore, the court did not err by denying the request for fees. As to the costs, the trial court awarded most of the requested costs to the PR after a hearing, denying only some that it found to be unreasonable. Therefore, the court did not err in its award of costs.

The judgment and orders were affirmed.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Collective Bargaining Agreement Provided for Payment for ELA Classes

The Colorado Court of Appeals issued its opinion in Denver Classroom Teachers Association v. School District No. 1 in the County of Denver and State of Colorado on Thursday, January 12, 2017.

Collective Bargaining Agreements—Damages—Statute of Limitations—Administrative Remedies.

School District No. 1 and the Board of Education of School District No. 1 in the County of Denver and State of Colorado (collectively, the District) and the Denver Classroom Teachers Association (DCTA) entered into several collective bargaining agreements (CBAs) and extensions from 2005 to 2015. From the mid-1990s until the 2006–07 school year, the District compensated teachers for attending English Language Acquisition (ELA) training. ELA is a program to train teachers to work more effectively with students who have limited English language proficiency. A federal consent order requires the District to have teachers who are trained to teach such students. After the 2006–07 school year, the District stopped paying teachers for attending the training. DCTA filed a grievance against the District alleging violations of the 2005–08 CBA. DCTA subsequently filed suit for breach of the 2005–08 and 2008–11 CBAs and the extensions, and a jury returned verdicts in favor of DCTA for breach of contract, but it held the District not liable in special interrogatories regarding breach for teachers in the Professional Compensation (ProComp) system.

On appeal, the District first contended that the CBAs and extensions were unambiguous and that they did not require the district to pay teachers for ELA training. Because the articles provide for payment for work beyond the 40-hour week, and because the ELA training may fall into that category, the contract was fairly susceptible to being interpreted to require payment for such work. Therefore, the CBAs were ambiguous, and the trial court properly let the interpretation go to the jury as a question of fact.

The District next contended that additional evidence showed unambiguously that it was not required to compensate teachers for ELA training beyond that year because (1) ELA training was a special condition of employment and (2) the parties’ bargaining history indicates that any requirement to compensate teachers for ELA training was purposely excluded from the CBAs. First, the CBAs were ambiguous regarding whether ELA training is a “special condition” regarding assignment of the teacher, requiring the teachers, not the District to pay for the training. Second, the District’s past practice of paying teachers for ELA training supported DCTA’s position that the CBAs entitled teachers to receive pay for ELA training.Therefore, the question was properly given to the jury.

The District also asserted that the trial court erred in not precluding recovery of damages that accrued before October 24, 2007, which was six years before the case was filed. The statute of limitations for breaching a CBA is six years. The District stopped paying teachers for ELA training starting with the 2007–08 school year, which began on August 13, 2007. DCTA filed its complaint on October 24, 2013. The trial court did not commit reversible error in deciding to award damages for the complete Fall 2007 semester.

Finally, the District contended that DCTA should have been barred from any relief for the 2008–09 school year and beyond because it failed to exhaust administrative remedies for those years. DCTA filed a grievance only for the 2007–08 school year, which was under the 2005–08 CBA. Further efforts by DCTA to achieve payment for ELA training through administrative remedies would have been futile, and the trial court did not err in this finding.

DCTA, in its cross-appeal, contended that the trial court erred in giving the jury special interrogatories to decide whether teachers under the ProComp system were exempt from receiving extra pay for ELA training. Because competent evidence supported the assertion, the trial court did not abuse its discretion in allowing the jury to determine whether teachers under the ProComp agreement forfeited their entitlement to compensation for ELA training.

The final judgment was affirmed.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Posting Bond is Necessary but Insufficient Condition to Stay Dissolution Proceedings

The Colorado Court of Appeals issued its opinion in In re Marriage of Finn on Thursday, December 30, 2016.

Post-Dissolution Marriage Proceeding—Request for Stay—Romero v. City of Fountain.

Husband and wife had entered into a marital agreement. Wife later filed for dissolution of the marriage, and the trial court subsequently issued a detailed order directing husband to make certain payments to wife within 20 days. Husband filed a motion for post-trial relief pursuant to C.R.C.P. 59 and 60, which was denied. Husband appealed and also filed a motion for stay with the trial court and requested approval of his supersedeas bond; both requests were denied.

Pursuant to C.A.R. 8, husband sought a stay of the trial court’s orders requiring him to pay wife certain sums of money and to return her artwork and other personal property. Husband presented a redacted copy of a cashier’s check in the amount necessary for a supersedeas bond and represented that his counsel would deposit the check if his motion were granted.

Stays pending appeal are controlled by C.A.R. 8(a). Romero v. City of Fountain adopted a four-part test for determining whether a stay should be issued under CAR 8: (1) whether the moving party has made a strong showing that it is likely to prevail on the merits, (2) whether the moving party will suffer irreparable harm if a stay is not granted, (3) whether other interested parties would be harmed by granting the stay, and (4) whether the public interest will be harmed by granting the stay. Romero involved a motion to stay an order denying an injunction. Husband argued that Romero does not apply here.

A stay is an exercise of judicial discretion and not a matter of right. The Colorado Court of Appeals first concluded that posting a supersedeas bond alone is insufficient to mandate a stay in a family law case. As to both the monetary and nonmonetary orders, the court then determined that a court considering a stay of that part of a judgment involving marital and separate property must consider the first three Romero factors; the fourth factor, harm to the public interest, is ordinarily not relevant in the context of a dissolution of marriage. The court found that (1) husband had not made even a cursory showing as to why his appeal was likely to succeed on the merits; (2) husband’s contention that he faces “clear” irreparable harm if a stay is not granted was unpersuasive; and (3) wife would be harmed by the issuance of a stay, because she would be denied benefits she negotiated in the marital agreement.

The motion for stay was denied.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: “Newsletter Exclusion” Did Not Apply to Unlicensed Securities Advisor

The Colorado Court of Appeals issued its opinion in Mandel v. Rome on Thursday, December 30, 2016.

Colorado Securities Act—Licensure—Summary Judgment—Investment Adviser—First Amendment—Restitution—Permanent Injunction.

Defendants Mandel and Wall Street Radio, Inc. hosted a radio show devoted to security investments, Wall Street Radio (WSR). They also offered through a website a variety of investment related services under two plans. The Master Membership Plan, with a $500 annual fee, provided newsletters, seminars, and the opportunity to email or call defendant Mandel twice a week with questions about specific stocks (crystal ball readings). The Lead Trader Membership Plan, under which subscribers paid between $1000 and $2000 annually, provided the same services as Master Membership and also offered the opportunity to mimic Mandel’s own security trades through an investment vehicle known as auto-trading. In auto-trading, trades are automatically made that mimic the lead trader’s trades without the need for approval. Followers are often not aware of the trades until after they have occurred.

The auto-trading was done through a company called Ditto Trade, in which Mandel owned an interest. Ditto Trade requires its lead traders to attest that they are either registered investment advisers or exempt from registration. Neither Mandel nor WSR were licensed in Colorado as investment advisers or investment adviser representatives. In 2008, Mandel had applied for a license, but his application was denied in an administrative action. A stipulated consent order denying the application precluded him from reapplying for 10 years and barred him from acting as a solicitor or otherwise associating with any Colorado licensed investment adviser or “federally covered” adviser. Mandel attested to operating within an exemption.

This action was commenced by the Securities Commissioner of Colorado, Rome, against Mandel and WSR, alleging they had acted as unlicensed investment advisers or investment adviser representatives under the Colorado Securities Act (CSA). Defendants claimed that pursuant to the CRS § 11-51-201(9.5)(b)(III) “newsletter exclusion” they were exempt from licensure. The trial court granted summary judgment against defendants. It entered a permanent injunction and directed them to pay $80,000 in restitution ($1000 for each auto-trading subscriber).

On appeal, defendants argued that the trial court erroneously entered summary judgment because a genuine issue of material fact existed as to whether they acted as investment advisers or investment adviser representatives. The Colorado Court of Appeals found that the Commissioner presented undisputed facts sufficient to resolve the case. It therefore turned to whether judgment was appropriate as a matter of law.

There was no dispute to the evidence presented by the Commissioner that defendants met the basic definition of investment adviser or investment adviser representative. To avoid the licensing requirement, defendants had to meet the “newsletter exclusion” from the definition of investment adviser, which required their services to qualify as bona fide publications or newsletters with a regular circulation. The court found that the lead trader services were not “publications” generally disseminated to subscribers. It rejected defendants’ argument that because they disseminated a newsletter, all of their other activities fell within the exclusion. Also, the lead trader service was not bona fide because it did not consist of disinterested commentary or analysis; instead, each follower’s investment decision was directly linked to Mandel’s investment account. Thus Mandel could personally benefit from the trades. Finally, the service was not “regular.” It did not follow a routine schedule but occurred when Mandel decided to make trades. Similarly, the crystal ball readings were not regular and addressed specific investment situations. Because defendants provided both services for compensation without a license they violated the CSA.

Defendants further argued that the summary judgment was inappropriate because the Commissioner failed to controvert their affirmative defense that the First Amendment of the federal constitution and Colorado Constitution art. II, § 10 barred the enforcement action. Because the services provided were sufficiently personal to treat defendants as investment advisors or investment representatives, requiring them to obtain a license as a condition of providing these services is constitutional.

Defendants also argued that the trial court erred in imposing restitution, contending that only damages could be awarded under the CSA. The court did not need to address this argument because it held that the record and the law support the award under a common law restitution theory.

Lastly, defendants challenged both parts of the permanent injunction. Defendants argued that the first part of the injunction improperly enjoins them from engaging in lawful activity. Defendants contended that the court abused its discretion and exceeded its statutory authority by enjoining them from “associating in any capacity” with securities professionals engaged in business in Colorado. The court found that the trial court had statutory authority to enjoin defendants from associating with securities professionals to ensure compliance with the CSA. However, the court found that the first part of the injunction was overly broad and subject to different interpretations.

Defendants argued that the second part of the injunction is simply an edict to obey the law and is thus overly broad and vague. The court agreed.

The summary judgment and restitution orders were affirmed. The injunction was vacated in part and reversed in part, and the case was remanded to the trial court for further proceedings.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Trustee’s Loss in Recall Election Did Not Arise from Town’s Misconduct

The Colorado Court of Appeals issued its opinion in Jones v. Samora on Thursday, December 30, 2016.

Summary Judgment—Identity of Persons Casting Votes—Colo. Const. Art. VII, § 8—Standing—§ 1983 Claim—Law of the Case—Issue Preclusion.

Residents of the Town of Center (Town) organized a recall election to oust the trustees, including Jones, from their positions. Voters either turned in mail ballots or voted in person. All of the ballots had numbered stubs and, based on these stubs, the town clerk, Samora, had a list that showed which voter had received which ballot. He used the list to ensure that each voter had voted only once. To ensure voter secrecy, the stubs were removed before they were tallied. These procedures were used for all in-person ballots that were cast. But the procedures were not followed at all times for the mail-in ballots. At some point, the election judges realized that they had not removed the stubs from some ballots, but decided to continue tallying the ballots before removing the stubs. Because they could see the identifying numbers on the stubs when tallying the votes, the judges could have determined the identity of the voters by consulting the voter list.

Jones and Citizen Center, a nonprofit, filed this lawsuit including five state law claims and a § 1983 claim. The state law claims were severed from the § 1983 claim. A bench trial was held on the state law claims. The court found that the procedural errors were unintentional, that no voter identity had been disclosed when tallying the ballots, and that the election was fundamentally untainted by any substantive intentional error of procedure. However, the court concluded that tallying the mail-in ballots had violated Article VII, § 8 of the Colorado Constitution. Even though no voter identities had been revealed, the opportunity to discover them had been available and this violated Colorado’s constitutional and statutory guarantee of a secret ballot. The court voided the results of the recall election and ordered the Town to hold a new recall election within 30 to 90 days.

The Town appealed. The Colorado Supreme Court reversed the trial court’s decision and reinstated the recall election results, concluding that the stubs were on the ballots because a statute required them to be there; there was no violation of the Colorado Constitution; and the trial court erred in concluding that the election had been void.

The § 1983 claim was still at issue. Following the Supreme Court’s decision, both sides moved for summary judgment. The court granted the Town’s motion and denied plaintiffs’ motion.

On appeal, the Town asserted that plaintiffs did not have standing to file the case. As to the trustee, the Colorado Court of Appeals held that because the loss of the trustee’s position did not arise from the Town’s conduct, the trustee could not satisfy the injury requirement. In addition, because the trustee suffered no injury, he did not have third-party standing, and because he failed to allege his tax dollars were used in an unconstitutional manner, he did not have taxpayer standing.

Although the trustee lacked standing, the court found that Citizen Center had organizational standing because one or more of its members had voted in the recall election by mail-in ballot, and therefore their right to cast a secret ballot had allegedly been violated; the interests Citizen Center sought to protect were germane to its purpose; and the claim asserted and relief requested did not require that individual members of the organization participate in the case.

Regarding its summary judgment motion, the Town asserted that the law of the case barred Citizen Center’s claim. Here, the state law claims proceeding and the § 1983 proceeding were severed and were not the same case. In addition, the law of the case doctrine applies only to a court’s decisions of law, not to its resolution of factual questions. Whether the Town actually violated voter secrecy rights is a question of fact. Thus the law of the case doctrine does not apply.

The Town also asserted that issue preclusion barred Citizen Center’s claim. Issue preclusion bars relitigating factual matters that a court has previously litigated and decided. Here, the factual issue in the state proceeding was identical to the § 1983 factual issue: whether the mail-in voters’ secrecy rights were actually violated. Citizen Center was involved in the state claims case and that case ended in a final judgment. Citizen Center also had a full and fair opportunity to litigate the factual issue of whether the mail-in voters’ secrecy rights were violated. Therefore, issue preclusion barred Citizen Center from relitigating whether the mail-in voters’ secrecy rights were violated.

On the § 1983 claim, the court concluded that there was no genuine issue as to any material fact and the trial court properly granted the Town’s motion for summary judgment. Further, applying the issue preclusion doctrine, the election judges did not infringe on Citizen Center’s members rights, and the Town did not deprive those members of their constitutional rights.

The judgment was affirmed.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Exculpatory Clauses in Fitness Agreement Did Not Bar PLA Claim

The Colorado Court of Appeals issued its opinion in Stone v. Life Time Fitness, Inc. on Thursday, December 30, 2016.

Summary Judgment—Negligence—Premises Liability Act—Liability Release—Assumption of Risk.

Stone was a member of a fitness club owned by defendants (collectively, Life Time). She fell and fractured her ankle in the club’s women’s locker room after a workout. Stone asserted a general negligence claim and a claim under Colorado’s Premises Liability Act (PLA), alleging that Life Time allowed a trip hazard and dangerous condition to exist and thus failed to exercise reasonable care.

Life Time moved for summary judgment, relying on assumption of risk and liability release language contained in the agreement Stone signed when she joined the club. The district court granted the motion, without distinguishing between the negligence and PLA claims, finding that the agreement was valid and enforceable and that Stone had released Life Time from all the claims asserted in the complaint.

On appeal, Stone contended that the district court erred in entering summary judgment and dismissing her action. As to the negligence claim, the Court of Appeals determined that the PLA provides the sole remedy for injuries against landowners on their property and abrogates common law negligence claims against landowners. Thus Stone could not bring a common law negligence claim against Life Time.

Stone also argued that the exculpatory clauses in the agreement, while applying to the workout areas, did not clearly and unambiguously apply to injuries incurred in the women’s locker room. Exculpatory agreements are generally disfavored. A court must consider four factors to determine whether an exculpatory agreement is valid: (1) the existence of a duty to the public; (2) the nature of the service performed; (3) whether the contract was fairly entered into; and (4) whether the intention of the parties was expressed in clear and unambiguous language. As to the first factor, the Colorado Supreme Court has specified that no public duty is implicated if a business provides recreational services. On the second factor, courts have consistently held that recreational services are neither essential nor a matter of practical necessity. With respect to the third factor, recreational service contracts of this type are generally considered to be fairly entered into. These three factors weighed in favor of the enforceability of the agreement. On the fourth prong, however, in waiving future negligence claims, the intention of the parties must be expressed in clear and unambiguous language. After scrutinizing the exculpatory clauses, the court of appeals concluded that the agreement used excessive legal jargon, was unnecessarily complex, and created a likelihood of confusion. Thus, the agreement did not bar Stone’s PLA claim.

The judgment on the negligence claim was affirmed, the judgment on the PLA claim was reversed, and the case was remanded.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Statements in Police Interviews Were Not Voluntary and Should Not Have Been Admitted

The Colorado Court of Appeals issued its opinion in People v. Springsted on Thursday, December 30, 2016.

Statements—Police Interviews—Involuntary.

In this murder case, the prosecution presented evidence that the victim was shot by two people. The primary issue at trial was the identity of the second shooter. The shooting occurred inside the home of codefendant Malory (Popeye), who was the first shooter. Springsted was present during the incident. Within an hour of the shooting, Springsted was interviewed by police in a police interview room. Over the next four days, the police interviewed Springsted five more times over the course of more than 11 hours. While some evidence implicated Springsted as the second shooter, the serological evidence implicated only Popeye as a shooter. Springsted was convicted of one count of first degree murder, one count of conspiracy to commit first degree murder, and two counts of violent crime.

On appeal, Springsted challenged the court’s admission of his statements from the police interviews, alleging that they were obtained involuntarily. When a defendant seeks to suppress statements as involuntary, the prosecution must prove by a preponderance of the evidence that the statements resulted from the maker’s free and unconstrained choice. After a careful review of the totality of the circumstances of the more than 11 hours of videotape, the Colorado Court of Appeals determined that the statements from the first two interviews were voluntary and admissible. However, Springsted’s statements in the remaining interviews were involuntary and should have been suppressed. Because there was a reasonable possibility that the statements from these interviews contributed to Springsted’s convictions, the error was not harmless.

The judgments were reversed and the case was remanded for a new trial.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: List of Examples for Notice in Statute Not Exclusive

The Colorado Court of Appeals issued its opinion in People v. Patton on Thursday, December 30, 2016.

Unauthorized Use of a Financial Instrument—Notice—Theft—Consecutive Sentence—Concurrent Sentence—–Statutory Amendment.

Patton purchased over $8,000 worth of consumer electronics from Ultimate Electronics using a Wells Fargo debit card that was issued to him. The card was declined during the transaction, and Patton used a false override authorization code to force the sale. Ultimate Electronics then received a “charge-back” from Wells Fargo, meaning it was not paid for the purchase. At trial, a Wells Fargo representative testified that the card had been cancelled before the transaction when Patton called the bank and reported that he had neither received it nor made purchases on it. The representative also testified that the bank employee would have told Patton that the card was cancelled and the bank would not have given an override code for the card. Patton was convicted of unauthorized use of a financial instrument and theft. He received a sentence of six years for theft and a consecutive sentence of three years for unauthorized use of a financial instrument.

On appeal, Patton argued that the trial court erred by denying his motion for judgment of acquittal after the prosecution failed to prove that he received notice in person or in writing that the debit card had expired or had been revoked or cancelled. The unauthorized use of a financial instrument statute does not require notice only in person or in writing. There was sufficient evidence to support a conclusion beyond a reasonable doubt that Patton received notice by telephone that his card was cancelled, revoked, or expired.

Patton also contended that the court committed plain error by imposing consecutive sentences because his crimes were based on identical evidence. When a defendant is convicted of multiple crimes based on the same act or series of acts in the same criminal episode and the evidence supporting each conviction is identical, the sentence must be concurrent. Here, the use of the cancelled debit card for the purchases without payment was part of the theft. Because the convictions were supported by identical evidence, the statute required the trial court to impose concurrent rather than consecutive sentences.

Patton further argued that his sentence should be reduced based on a change in the theft statute. At the time of his offenses in 2009, the value of the items Patton stole constituted a class 4 felony. In 2013, the statute was amended to reduce the offense to a class 5 felony. Because Patton was sentenced in 2014, he was entitled to the benefit of the amended statute.

Patton finally contended that the court improperly entered a conviction for a class 4 felony against him without a finding of actual value by the jury, and that instead he should only be convicted of a class 1 misdemeanor. There was evidence at trial that Patton had stolen items exceeding $8,000 in value, and Patton did not contest the value. Therefore, the record supports the conviction.

The judgment of conviction was affirmed, the consecutive sentences were vacated, the felony theft sentence was vacated, and the case was remanded for resentencing.

Summary provided courtesy of The Colorado Lawyer.