May 2, 2016

Colorado Court of Appeals: Contract that Violates Rules of Professional Conduct Unenforceable

The Colorado Court of Appeals issued its opinion in Calvert v. Mayberry on Thursday, April 21, 2016.

Disciplinary Proceeding—Oral Contract—Colo. RPC 1.8(a)—Issue Preclusion—Void Agreement—Equitable Lien—Unclean Hands.

In a question of first impression, the Colorado Court of Appeals decided that an attorney who enters into a contract with a client that violates Colo. RPC 1.8(a) cannot later enforce the contract against the client.

The Colorado Supreme Court disbarred the attorney after a hearing board determined he had committed ethical violations, including some against the former client in this case. Specifically, the hearing board found that the attorney had loaned the former client over $100,000 and secured his interest in the loan funds by recording a false deed of trust in the chain of title on her house. The hearing board also found that the attorney had not complied with Colo. RPC 1.8(a) when he made the loans to the former client. The attorney then filed this case to recoup money he had loaned to the former client, claiming that he had an oral agreement with the client for repayment of the loans, and alternatively asserting that the trial court should impose an equitable lien on the former client’s house. The trial court granted summary judgment for the former client and her daughter (to whom she had quitclaimed her interest in the house), finding that because the oral contract between the former client and the attorney violated Colo. RPC 1.8(a), the attorney was ethically prohibited from enforcing that agreement.

The attorney appealed. On appeal, the former client contended that the doctrine of issue preclusion barred the attorney from relitigating factual issues that were litigated during the disciplinary proceeding. The court agreed; therefore, the hearing board’s factual findings bind the attorney in this case, including its finding that the attorney violated Rule 1.8(a) when he entered into the oral contract with the former client, and the oral contract between the attorney and the former client is void and unenforceable. The attorney contended that the trial court erred in applying the doctrine of unclean hands to bar his request for an equitable lien. Based on the attorney’s misconduct, the court disagreed. The attorney also asserted a fraud claim against the former client’s daughter, but his allegations did not support this claim, and it failed as a matter of law. The district court properly entered summary judgment.

The judgment was affirmed and the case was remanded to the trial court to determine whether fees should be awarded to the former client and her daughter.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Workers’ Compensation Settlement Agreement Precluded Later Reopening for Unknown Injuries

The Colorado Court of Appeals issued its opinion in Amerigas Propane & Indemnity Insurance Co. of North America v. Industrial Claim Appeals Office on Thursday, April 21, 2016.

Mutual Mistake—Workers’ Compensation Claim—Reopening Settlement Agreement.

The worker was injured while working for Amerigas Propane and filed a claim for compensation. The worker and the employer (including the insurer) agreed to settle the claim. The settlement agreement clearly stated that the worker would forever waive his right to request compensation for unknown injuries. It also stipulated that the claim could only be reopened on grounds of fraud or mistake of fact. The worker later moved to reopen the settlement, alleging a mistake of fact in that he had a newly discovered injury that was unknown at the time of the settlement and it was related to the original injury. An administrative law judge (ALJ) reopened the claim. The employer appealed to the Industrial Claim Appeals Office (Panel) and the Panel affirmed. The employer then filed this appeal.

The Colorado Court of Appeals examined the language of the settlement agreement, specifically its statement that the worker waived his right to compensation for “unknown injuries” that arose “as a consequence of” or “result[ed]” from the original injury. The court found the newly discovered injury was clearly and unequivocally covered by this language and therefore the case could not be reopened.

The Panel’s order was set aside and the case was remanded to the Panel to direct the ALJ to vacate the worker’s benefits award and to deny his motion to reopen the settlement.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Claimant Released to Full Duty but Unable to Perform Work Entitled to TTD

The Colorado Court of Appeals issued its opinion in Archuleta v. Industrial Claim Appeals Office on Thursday, April 21, 2016.

Workers’ Compensation—Temporary Total Disability Benefits—C.R.S. § 8-42-105(3)(c)—C.R.S. § 8-42-103—C.R.S. § 8-42-105(1).

Claimant sustained a work-related injury in February 2014. His physician imposed temporary restrictions and released him to modified duty. On March 5, the attending physician released him to full duty work with no restrictions. On May 21, the attending physician determined claimant had reached maximum medical improvement (MMI) with no impairment restrictions. Employer filed a final admission of liability.

Claimant continued to maintain that he could perform only light duty work because of his injury. He was laid off one week after reaching MMI because, according to him, he was “hurt on the job,” could no longer perform his duties, and was on “light duty.” He requested a division-sponsored independent medical examination (DIME) to challenge the MMI finding. The DIME physician concluded he was not at MMI. An administrative law judge (ALJ) then awarded claimant temporary total disability (TTD) benefits, finding that he was laid off because of his industrial injury. On review, the Industrial Claims Appeal Office (Panel) reversed, finding that under C.R.S. § 8-42-105(3)(c), once a claimant has been released to full duty work TTD benefits must cease.

On appeal, claimant argued that C.R.S. § 8-42-105(3)(c) applies only to the termination of benefits and because he didn’t have any benefits when the attending physician released him to work, his case should have been analyzed under C.R.S. §§ 8-42-103 and -105(1), which apply to the commencement of benefits and do not have a restriction based on release to full duty. The court of appeals agreed, holding that C.R.S. § 8-42-105(3)(c) did not apply to claimant’s case because the statute can only terminate benefits that have already commenced and therefore can only be applied prospectively.

The order was set aside and the case was remanded with directions to reinstate the ALJ’s order.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Court Within Jurisdiction to Assert Long-Arm Statute Against Foreign Business Selling Products in United States

The Colorado Court of Appeals issued its opinion in Boustred v. Align Corp. Ltd. on Thursday, April 21, 2016.

Interlocutory Appeal—CRCP 12(b)(2) Lack of Personal Jurisdiction—Minimum Contacts—Due Process Clause.

Align Corporation Limited is a Taiwanese company that manufactures and sells remote control helicopters and related parts. Align has no physical corporate presence in the United States, but it engages U.S. distributors to sell its products to retailers, which then sell them to consumers. One of Align’s distributors was defendant Horizon Hobby, Inc.

Boustred purchased a remote control helicopter and a main rotor holder, manufactured by Align, through Horizon. Boustred alleged the main rotor holder broke during testing and caused him to lose an eye. He filed strict liability and negligence claims against Align and Horizon in Larimer County. After service in Taiwan, Align asked the trial court to quash service and dismiss all claims against it for lack of personal jurisdiction. The trial court found that under Archangel Diamond Corp. v. Lukoil it could assert specific jurisdiction over Align, and denied the motion. This interlocutory appeal followed. Align petitioned the court of appeals to address the effect of the U.S. Supreme Court’s plurality opinion in J. McIntyre Machinery, Ltd. v. Nicastro on Colorado’s personal jurisdiction framework under Archangel.

Colorado’s long-arm statute is intended to confer the maximum jurisdiction allowable by the Due Process clauses of the United States and Colorado constitutions. Specific jurisdiction exists when the alleged injuries resulting in litigation arise out of and are related to a defendant’s activities that are significant and purposefully directed at residents of the forum state. If the requisite minimum contacts are established, a court must determine whether its exercise of personal jurisdiction over a defendant is reasonable and comports with notions of fair play and substantial justice. Align argued that merely placing a product into the stream of commerce, without more, is insufficient for a court to assert personal jurisdiction.

The court cited World-Wide Volkswagon v. Woodson, which held that a “forum State does not exceed its powers under the Due Process Clause if it asserts personal jurisdiction over a corporation that delivers its products into the stream of commerce with the expectation that they will be purchased by consumers in the forum State.” Subsequent Supreme Court plurality decisions have differed on the scope of this theory. The court concluded that the narrowest grounds articulated in the plurality opinions, those of Justice Breyer in J. McIntyre and Justice Brennan in Asahi Metal Industry Co. v. Superior Court are controlling and together hold that World-Wide Volkswagon remains the prevailing decision articulating the stream of commerce theory.

Applying that standard, the court found that Boustred made a sufficient prima facie showing of Colorado’s specific jurisdiction over Align and that asserting such jurisdiction is reasonable and does not offend traditional notions of fair play and substantial justice.

The order was affirmed.

Summary provided courtesy of The Colorado Lawyer.

Tenth Circuit: Unpublished Opinions, 4/29/2016

On Friday, April 29, 2016, the Tenth Circuit Court of Appeals issued one published opinion and six unpublished opinions.

United States v. Prince

Galloway v. Roberts

Guerrero v. Meadows

Haff v. Firman

Arrington v. Chavez

Stewart v. People of the State of Colorado

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

Colorado Court of Appeals: Denver District Court Never Acquired Jurisdiction Over Juvenile Defendant

The Colorado Court of Appeals issued its opinion in People v. Sandoval on Thursday, April 21, 2016.

Juvenile—Direct Filing—Subject Matter Jurisdiction—Crime of Violence.

Defendant was 16 years old when, at a party, he brought the victim a drink mixed with a crushed pill, which she drank. Afterward, the victim appeared to be dizzy, stumbled, and had difficulty talking. Then defendant, along with two other male teenagers, sexually assaulted the victim. The prosecution directly filed two charges against defendant: (1) sexual assault by causing submission of the victim through the application of physical force and (2) sexual assault of the victim while he knew she was incapable of appraising the nature of her conduct. The prosecution later dismissed the first charge, and a jury found defendant guilty of the second charge. The district court sentenced defendant to eight years of sex offender specific intensive probation and 90 days in jail.

On appeal, defendant contended that the district court lacked subject matter jurisdiction to sentence him because neither offense charged in the complaint was a crime of violence under C.R.S. § 18-1.3-406 and thus did not qualify for direct filing in the district court. Because neither count was a crime of violence under C.R.S. § 18-1.3-406, the charges were not eligible for direct filing in the district court. The court of appeals held that (1) the juvenile court had exclusive jurisdiction over the charge on which defendant was tried, convicted, and sentenced in the district court; (2) the district court lacked subject matter jurisdiction; and (3) therefore, the judgment was a nullity and required dismissal.

The judgment and sentence were vacated and the case was remanded to the district court for dismissal.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Restitution Applicable When Defendant’s Conduct Caused Damage Regardless of Conviction

The Colorado Court of Appeals issued its opinion in People v. Ortiz on Thursday, April 27, 2016.

Vehicular Eluding—Victim—Restitution—Evidence—Hearsay.

After a deputy sheriff stopped defendant’s vehicle to investigate a report of shots fired by a person driving a vehicle like defendant’s, defendant sped away. The officer gave chase, bumping into defendant’s car several times before defendant stopped. The People charged defendant with a number of crimes. Defendant and the People reached a plea agreement under which defendant agreed to plead guilty to one count of aggravated driving after revocation prohibited (reckless driving) and one count of violation of a protection order and the People agreed to drop the other charges. The district court accepted the agreement and sentenced defendant. On request of the People, the court ordered restitution for the damages to the patrol car.

On appeal, defendant contended that because he did not plead guilty to an offense that specifically identified the state patrol as a victim, the state patrol was not a victim within the meaning of the restitution statutes. However, the state patrol was a victim of vehicular eluding, which was included among the charges against defendant. Therefore, it was a victim for purposes of the restitution statutes, even though defendant pleaded guilty to other charges. Accordingly, the district court did not err in allowing the state patrol to seek restitution.

Defendant also contended that the evidence was insufficient to support the restitution award because it was entirely hearsay and basing the award on hearsay violated his right to due process. The prosecution is not limited by the rules of evidence in proving an amount of restitution, and an award of restitution may be based solely on a victim’s impact statement, which is hearsay. Considered as a whole, the evidence sufficiently showed the cost of the damage and that defendant caused it. In addition, defendant’s counsel conducted thorough cross-examination about the damage to the patrol car and defendant chose not to rebut the evidence; therefore, there is no due process violation.

The order was affirmed.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Videos Properly Admitted as Animations, Not Simulations

The Colorado Court of Appeals issued its opinion in People v. Douglas on Thursday, April 21, 2016.

Collision—Injuries—Animation—Simulation—Evidence—Restitution.

While driving his car, defendant looked down for a moment and struck a bicyclist with his vehicle, causing her injuries. Defendant drove away, claiming he had not seen the bicyclist. A jury convicted defendant of leaving the scene of an accident, failure to report an accident, and careless driving.

Defendant appealed the judgment and restitution order, contending that the trial court should not have allowed the prosecution to show the jury three short video depictions of an automobile-bicycle collision. He asserted that the videos were simulations — which are scientific evidence offered as substantive proof and must meet more rigorous foundational requirements for admission than animations, which are demonstrative evidence — and that the prosecution did not lay an adequate foundation to support the court’s decision to admit them. Defendant asserted alternatively that if the videos were animations, they were inadmissible because they were an unfair and inaccurate depiction. The Colorado Court of Appeals decided the videos were animations. The videos were prepared by a state trooper, who was an accident reconstruction specialist, to represent the trooper’s opinion about how the collision had occurred. The videos were substantially similar to the collision they depicted. The trial court did not abuse its discretion when it decided the videos were animations and admitted them into evidence as demonstrative exhibits.

Defendant also contended that the trial court abused its discretion when it ordered him to pay restitution to the insurer. The restitution amount only included the bicyclist’s lost wages, the replacement cost of her bicycle and some equipment that was damaged by the collision, and her medical expenses. The amount did not include reimbursement for pain and suffering. Therefore, the court did not abuse its discretion.

The judgment and order were affirmed.

Summary provided courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Announcement Sheet, 4/28/2016

On Thursday, April 28, 2016, the Colorado Court of Appeals issued no published opinion and 34 unpublished opinions.

Neither State Judicial nor the Colorado Bar Association provides case summaries for unpublished appellate opinions. The case announcement sheet is available here.

Tenth Circuit: Unpublished Opinions, 4/28/2016

On Thursday, April 28, 2016, the Tenth Circuit Court of Appeals issued no published opinion and four unpublished opinions.

Martinez Garcia v. Lynch

United States v. Lancaster

Morehead v. Douglas County Court

Hutson v. State of Colorado

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

Tenth Circuit: Government Lacks Authority to Garnish Retirement Accounts When Restitution Paid According to Schedule

The Tenth Circuit Court of Appeals issued its opinion in United States v. Martinez on Wednesday, December 16, 2015.

Toby Martinez was convicted of mail fraud and conspiracy and was ordered to pay roughly $2.7 million in restitution. The district court ordered that he was to pay the restitution through monthly payments of a percentage of his net disposable income. Upon leaving prison, Martinez was unable to obtain steady employment, and as a result owed relatively little through his court-ordered payment schedule. The government served writs of garnishment for two of Martinez’s retirement accounts, which were worth roughly $470,000 together. Martinez moved to quash the writs of garnishment in district court, but the court denied his motion. Martinez appealed, asking the court to consider whether the government can garnish assets beyond the amount currently due under the court-ordered payment plan. The Tenth Circuit determined it could not.

The Tenth Circuit began by analyzing 18 U.S.C. §§ 3613 and 3664, which allow the government to enforce orders of restitution as if they were liens or judgments in favor of the United States. The Tenth Circuit rejected the government’s argument that it could garnish the entire restitution amount, noting the argument incorrectly assumed the entire restitution amount was currently owed. The Tenth Circuit found that by statute, the district court—not the government—had the ability to determine how a defendant is to pay restitution. It is the government’s job to enforce the district court’s order. The Tenth Circuit analyzed whether Martinez owed the full restitution amount immediately or whether he owed only the installment payments until the full amount was paid. Analyzing the district court’s restitution order, the Circuit found that the district court ordered that Martinez owed only the installment payments. The Tenth Circuit noted that the full amount of restitution is owed only immediately only if the restitution order does not provide for installment payments. The Tenth Circuit also cautioned that the government’s position conflicts with the statutory directive to the district court to impose a payment schedule that reflects the defendant’s financial condition.

The Tenth Circuit reversed and remanded with instructions for the district court to grant Martinez’s motion to quash.

Tenth Circuit: Unpublished Opinions, 4/27/2016