December 19, 2014

Colorado Court of Appeals: Inmate’s Challenge to DOC Policies Not Barred by 30-Day Claims Limit

The Colorado Court of Appeals issued its opinion in Garcia v. Harms on Thursday, November 6, 2014.

Timely Filing—Code of Penal Discipline Claim.

Garcia was charged with assault under the Code of Penal Discipline (COPD) after a corrections officer accidentally pricked herself on a sewing needle he kept in his cell. Garcia was not present at the time, but he was charged and found culpable and disciplined. He was also required to pay restitution.

Garcia challenged his conviction, claiming: (1) his disciplinary hearing did not comply with constitutional due process requirements; (2) the COPD definition of “assault” was unconstitutionally vague on its face as applied to him; (3) the Colorado Department of Corrections (CDOC) exceeded its authority when it ordered him to pay restitution; (4) CRS §17-1-111, which exempts CDOC from certain provisions of the Administrative Procedure Act, violates constitutional separation of powers principles; and (5) the collection of restitution unjustly enriched CDOC. The district court dismissed Garcia’s complaint—filed nearly two years after his COPD conviction became final—as time-barred under CRCP 106.5.

Garcia challenged the dismissal, except as to claims one and five. He arguedthat claims two through four challenged “CDOC’s establishment of policies and general application of those policies” and not his disciplinary conviction and therefore were not barred under CRCP 106.5. The Court of Appeals agreed as to Garcia’s fourth claim and portions of his second and third claims.

Portions of Garcia’s second and third claims challenged only quasi-judicial action. However, the part of claim two asserting that the COPD definition of assault under which Garcia was convicted was unconstitutionally vague on its face, as well as the portion of claim three asserting the CDOC has adopted a monetary restitution policy that violates the Separation of Powers Clause, are not related to quasi-judicial actions. Also, claim four asserted that CRS §17-1-111 facially violates separation of powers principles. The Court held that these claims were covered by CRS §13-80-102(1)(h) as “actions against any public or governmental entity . . . ” insofar as defendants Governor Hickenlooper and the State of Colorado are concerned, and were subject to the one-year statute of limitations under the exceptions listed in CRS §13-80-103 insofar as CDOC officials and employees were concerned.

Accordingly, the Court affirmed the order dismissing Garcia’s as applied constitutional challenges in claims two and three and the remaining clams against the executive director of the CDOC, the warden of the Sterling Correctional Facility, the hearing officer who presided over his disciplinary hearing, and two unnamed correctional officers. It reversed the order dismissing Garcia’s fourth claim against Governor Hickenlooper and the State of Colorado. It also reversed the dismissal of Garcia’s facial constitutional challenge against those defendants in claim two and his facial constitutional challenge to CDOC policies in claim three. The case was remanded for further proceedings.

Summary and full case available here, courtesy of  The Colorado Lawyer.

Colorado Court of Appeals: Denial of Motor Vehicle Sales License Due to Felony Conviction Improper

The Colorado Court of Appeals issued its opinion in Colorado Motor Vehicle Dealer Board v. Freeman on Thursday, November 6, 2014.

Motor Vehicle Salesperson’s License—Third-Degree Assault—Mandatory Disqualifying Offense.

When Freeman applied for a motor vehicle salesperson’s license, his application was denied on five grounds by the Auto Industry Division of the Board (Division). The Division had found that Freeman’s previous conviction for third-degree assault of an at-risk adult constituted a mandatory disqualifying offense under CRS § 12-6-118(7)(a)(I).

On appeal, Freeman contended that the Colorado Motor Vehicle Board (Board) erred in upholding the Division’s denial of his license application. The statute provides, among other things, that a license shall be denied if an applicant has been convicted of a felony in violation of article 3, title 18 during the previous ten years. Because Freeman’s conviction was a felony conviction under CRS § 18-6.5-103(3)(c), not CRS § 18-3-204(1)(a), which specifies that a conviction for assault in the third degree is a class 1 misdemeanor, his conviction may not be used as a mandatory disqualifying offense under CRS § 12-6-118(7)(a)(I). Therefore, the Board erred and its order was vacated. However, because the Division denied Freeman’s application on four other grounds, the case was remanded to the Board with directions to address the additional grounds.

Summary and full case available here, courtesy of  The Colorado Lawyer.

Colorado Court of Appeals: Failure to Exhaust Administrative Remedies Deprived Trial Court of Jurisdiction

The Colorado Court of Appeals issued its opinion in Liberty Bankers Life Insurance Co. v. First Citizens Bank & Trust Co. on Thursday, November 6, 2014.

Subject Matter Jurisdiction—Financial Institutions Reform, Recovery and Enforcement Act—Receiver—Proof of Claim—Doctrine of Administrative Exhaustion—Attorney Fees.

The underlying claims in this case relate to appellant’s (Liberty) participation in two loans with Colorado Capital Bank (CCB) for the purpose of funding the development of a townhome project. CCB was closed by the Colorado Division of Banking on July 8, 2011, and the Federal Deposit Insurance Corporation (FDIC) was named its receiver (FDIC-R). On the same day, First Citizens Bank & Trust Co. (FCBT) purchased the assets and assumed the liabilities of CCB in a purchase and assumption agreement. The FDIC later denied Liberty’s proof of claim, and Liberty thereafter filed suit against FCBT and the FDIC-R in federal court. In the state court proceedings, Liberty filed twelve counterclaims against FCBT, which were dismissed by the court.

On appeal, Liberty argued that the district court incorrectly dismissed its counts 1 through 3 for lack of subject matter jurisdiction. However, Liberty did not properly plead the claims found in its counterclaims in its original proof of claim. Therefore, the district court correctly dismissed those claims for lack of subject matter jurisdiction.

Liberty further argued that the doctrine of administrative exhaustion did not apply in this case. Liberty’s futility argument was based on (1) the transfer of assets and liabilities to FCBT and (2) the FDIC-R’s motion to dismiss in the federal litigation. The jurisdictional bar extends to successors in interest of the failed bank. Further, by failing to properly plead its claims in the proof of claim, Liberty had already failed to exhaust the process provided to it. FDIC-R’s actions in filing a motion to dismiss, therefore, had no bearing on futility. Accordingly, Liberty’s pursuit of relief is not futile “beyond a reasonable doubt,” and does not excuse its failure to exhaust its claims. The district court correctly dismissed those claims for lack of subject matter jurisdiction.

FCBT claimed that it was entitled to reasonable attorney fees incurred on appeal under CRS § 13-17-201. Although Liberty’s counterclaims facially alleged a tort claim of gross negligence and willful misconduct, the overall action was more accurately characterized as a contract action, because all of the counterclaims were based on acts or omissions relating to the alleged breach of the two participation agreements. The essence of Liberty’s action did not sound in tort, so FCBT was not entitled to attorney fees incurred on appeal under CRS § 13-17-201.

Summary and full case available here, courtesy of  The Colorado Lawyer.

Colorado Court of Appeals: Uniform Debt-Management Services Act Does Not Implicate Subject Matter Jurisdiction

The Colorado Court of Appeals issued its opinion in State of Colorado v. Johnson Law Group, PLLC on Thursday, November 6, 2014.

Uniform Debt-Management Services Act—Subject Matter Jurisdiction—Affirmative Defense—Waiver.

Plaintiff, the State of Colorado, appealed the district court’s order dismissing its complaint against defendants, Johnson Law Group, PLLC, a Florida private limited liability company, and Clint L. Johnson. Johnson is an attorney who, in 2006, was licensed to practice law in Florida. In 2008, he added a debt-management services practice that extended to approximately forty-two states. In 2011, plaintiff filed a complaint against defendants, asserting violations of the Uniform Debt-Management Services Act (UDMSA) and the Colorado Consumer Protection Act. The court dismissed the complaint, concluding that the legal services exception defense was jurisdictional and, therefore, defendants were not subject to UDMSA regulation.

On appeal, plaintiff contended that the district court erred in dismissing its complaint for lack of subject matter jurisdiction. Because the legal services exception in the UDMSA does not implicate subject matter jurisdiction, it can be waived if not timely asserted as an affirmative defense. Defendant did not assert this affirmative defense until the eve of trial. Therefore, defendant waived any legal services exception defense by failing to assert it in their responsive pleading. The order dismissing the action was reversed and the case was remanded to the district court for a determination of penalties to be assessed against defendants.

Summary and full case available here, courtesy of  The Colorado Lawyer.

Colorado Court of Appeals: Jurors Should Have Been Polled Regarding Exposure to News Report Prejudicial to Defense

The Colorado Court of Appeals issued its opinion in People v. Jacobson on Thursday, November 6, 2014.

Poll the Jury—Media—Prejudice.

A jury convicted Jacobson of vehicular homicide, driving under the influence (DUI), and other related charges, all arising from a collision between her truck and a taxi cab. Two passengers in the taxi were killed.

During trial, defense counsel told the court that a report about the case had appeared the preceding night on Channel 4 newscast and the local television station’s website. Defense counsel requested to poll the jury concerning exposure to mid-trial publicity that included inadmissible, prejudicial information. The court denied the request.

On appeal, Jacobson argued that the court abused its discretion when it declined to poll the jury. The news report referred to Jacobson’s prior DUI conviction and prior accidents involving injury, alleged that she was driving without a license, and included an interview with someone involved in her previous accident. Due to the nature of this content, the court abused its discretion in failing to determine whether this information was inherently prejudicial and thereafter declining to poll the jury. Because this error was not harmless beyond a reasonable doubt, Jacobson’s convictions were reversed and the case was remanded for a new trial on all charges.

Summary and full case available here, courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Announcement Sheet, 11/6/2014

On Thursday, November 6, 2014, the Colorado Court of Appeals issued six published opinions and 29 unpublished opinions.

People v. Jacobson

State of Colorado v. Johnson Law Group, PLLC

Liberty Bankers Life Insurance Co. v. First Citizens Bank & Trust Co.

Colorado Motor Vehicle Dealer Board v. Freeman

Harper Hofer & Associates, LLC v. Northwest Direct Marketing, Inc.

Garcia v. Harms

Summaries of these cases are forthcoming, courtesy of The Colorado Lawyer.

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

 

Colorado Court of Appeals: Announcement Sheet, 10/30/2014

On Thursday, October 30, 2014, the Colorado Court of Appeals issued no published opinion and 37 unpublished opinions.

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

Colorado Court of Appeals: Trial Court Cannot Sua Sponte Certify Question for Interlocutory Review

The Colorado Court of Appeals issued its opinion in People in Interest of M.K.D.A.L. on Thursday, October 23, 2014.

CAR 4.2—Sua Sponte Certification of an Issue for Interlocutory Review.

J.A.A.U., the biological father of M.K.D.A.L., petitioned under CRS § 15-14-304(1) for his appointment as a permanent guardian. According to the petition, “[r]espondent is unable effectively to communicate in the English language to the extent that he lacks the ability to satisfy essential requirements for physical health, safety, or self-care even with appropriate and reasonably available technological assistance.”

The trial court denied the petition, finding that, as a matter of law, speaking English is not a requirement for competency. The court also stated that, pursuant to CAR 4.2, it “will stay this order for 14 days and certify that there is no current case law on this point and that determination of this issue will determine the case.” Petitioner timely filed a petition for interlocutory appeal. There was no motion or stipulation for certification.

Under CAR 4.2(c), the appealing party must move for certification or submit a stipulation signed by all parties within fourteen days after the date of the order to be appealed. The trial court then has discretion to certify the order as immediately appealable; however, if all parties stipulate, the trial court must certify the order. No case interpreting CAR 4.2 has addressed a petition to appeal based on a trial court’s sua sponte certification.

The Court of Appeals concluded that a trial court cannot certify sua sponte an issue for interlocutory review.The Court recognized that a case may arise in which, despite the parties’ inaction, the trial court perceives that its order clearly involves “a controlling and unresolved question of law,” immediate review of which would “promote a more orderly disposition or establish a final disposition of the action,” as provided by CAR 4.2(b). However, the rule only empowers trial courts to grant or deny a motion for certification, not to initiate certification. Accordingly, the petition was dismissed.

Summary and full case available here, courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Separate Property Remained Separate Despite Use to Pay Marital Debts

The Colorado Court of Appeals issued its opinion in In re Marriage of Corak on Thursday, October 23, 2014.

Marital Property—Marital Debt Allocations.

Husband and wife entered into a prenuptial agreement identifying separate property that each had acquired before the marriage. This separate property included a parcel of husband’s property (Shoshone property). The agreement stated that all separate property would remain as such.

Shortly after marrying, husband and wife jointly bought a piece of property (Pinyon property). Husband pledged the Shoshone property as collateral for a home equity line of credit for the down payment on the Pinyon property and the funds to remodel it. Husband and wife agreed to apply $16,000 from the credit line to retire one of wife’s premarital credit card debts. Husband and wife agreed that wife would make payments toward the line of credit.

Wife testified at the permanent orders hearing that she had made all of the payments on the credit line during the marriage, even beyond the amount she had used to retire her separate debt. She also testified that she had paid down some of her other premarital debts. Husband testified he paid down his separate debt during his marriage and admitted he had not disclosed the debt in the prenuptial agreement.

The district court ruled that husband’s act of pledging the Shoshone property as collateral for the line of credit turned a portion of it into marital property. The Court of Appeals found this to be an issue of first impression in Colorado. In looking to other jurisdictions, the Court found cases concluding that using separate property to secure a loan does not change the pledged property into marital property. The case was remanded for the trial court to determine the division of marital property and marital debt after setting aside all of the Shoshone property as husband’s separate property.

The Court agreed with husband that he had initially asked the trial court to restore the marital funds wife had spent to retire her separate premarital debt to the marital estate and credit them to her. However, after review of the record, the Court concluded that husband had intentionally abandoned this argument. Because the Court found husband had abandoned his claim to have these funds allocated differently, the Court will not disturb the trial court’s findings on appeal.

Summary and full case available here, courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Department of Revenue’s Challenge to Conservation Easement Tax Credits Barred by Statute of Limitations

The Colorado Court of Appeals issued its opinion in Markus v. Brohl, Exec. Dir. of Colorado Department of Revenue on Thursday, October 23, 2014.

Conservation Easement Tax Credits—Review Period by Department of Revenue—Summary Judgment.

In 2004, three pairs of landowners created conservation easements (CEs) on their lands, had them appraised, and sold them to the Otero County Land Trust for a portion of their appraised value. They applied part of the CE tax credits to their 2004 income tax liability. The landowners (CE donors) carried forward the remainder of the CE credits, some for personal use and some for the use of third parties.

On September 28, 2009, the Colorado Department of Revenue (Department) disallowed the entire CE tax credit of one pair of landowners because of a purported deficiency in the appraisal. For the same reason, in April 2010, the Department disallowed the claims of CE tax credits of the each of the second pair of landowners. The disallowances, under a four-year limitations period, affected only the donors’ use of claimed CE credits in the 2005–08 tax years.

On cross-motions for summary judgment, the CE donors argued that the four-year limitations period had expired before the Department acted to disallow their tax credits. The Department argued that the limitations period commenced each time a CE donor or transferee applied a CE tax credit to his or her tax liability and that it could evaluate the original claims for purposes of disallowing the use of credits for the 2005–08 tax years. The district court entered summary judgment in favor of the CE donors.

On appeal, the Department argued that the district court erred in its limitations determination, and that there was a genuine issue of material fact precluding summary judgment as to whether the CE donors had filed false or fraudulent tax returns. The Court of Appeals found that the applicable general statute of limitations was four years, and the time period commenced at the filing of a tax return. Under this system, the Court was inclined to side with the Department.

However, CRS § 39-22-522 specifically addresses the tax consequences of a CE. Under that statute, claimed CE tax credits may be transferred to third parties, who are then bound by “the same statute of limitations” as the CE donor. The Court supported an interpretation where a purchaser–transferee would have a low risk of disallowance of the CE credits by the Department. Here, because the Department did not challenge the validity and value of the CE tax credits prior to April 15, 2009, it was barred from disallowing them.

The Department also argued that there was a genuine issue of material fact as to whether the CE donors filed false or fraudulent tax returns that precluded summary judgment. After reviewing the record, the Court found no genuine dispute of any material fact. The judgment was affirmed.

Summary and full case available here, courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Laches Does Not Apply to Actions to Recover Past-Due Child Support

The Colorado Court of Appeals issued its opinion in In re Marriage of Johnson on Thursday, October 23, 2014.

Child Support Arrearages.

Father’s marriage to mother ended in 1983. He was ordered to pay $400 in monthly child support for their two children. In September 2012, mother requested that judgment enter for $893,285 in child support arrearages and interest. Father objected, asserting that under the applicable twenty-year statute of limitations, mother could collect arrearages accruing only after September 1992. He requested a hearing to make that determination. The magistrate entered judgment for mother for the full amount requested, without addressing father’s contention or his hearing request.

Father petitioned for district court review of the order. The court ruled that the twenty-year statute of limitations applied, vacated the magistrate’s order, and remanded the matter for an evidentiary hearing. After the hearing, the magistrate rejected father’s argument that child support had terminated when their last child turned 19 in July 1995 and that lachesbarred mother’s right to collect interest. The magistrate entered judgment for $23,260 for arrearages between September 1992 and July 1997, when the parties’ last child turned 21, plus interest, resulting in a judgment of $155,000. The district court adopted the order.

On appeal, father argued that child support automatically terminated on July 17, 1995 and that the finding of $23,260 in arrearages lacked record support. At the time of the dissolution, child support was owed until a child emancipated, which presumptively was at age 21. In 1991, the applicable statute was amended to provide that emancipation occurs and child support terminates when a child turns 19. The amendment applied to all child support obligations established before July 1, 1991. Therefore, father’s child support obligation terminated on July 17, 1995, when the last child turned 19.

Father also argued that it was error to hold that laches did not apply as to the right to collect interest. Under CRS § 14-14-106, interest is specified on arrearages in child support and it is not discretionary. The Court of Appeals has previously held that laches does not apply “to actions for the recovery of past due child support.” At the hearing, father had acknowledged that he owed $4,800 in arrearages for the period between July 1994 and July 1995. On remand, the court was ordered to calculate interest under CRS § 14-14-106 on the $4,800 and enter judgment for mother accordingly.

Summary and full case available here, courtesy of The Colorado Lawyer.

Colorado Court of Appeals: Deported Defendant’s Appeal Not Moot Where He is Not Barred from Reentry

The Colorado Court of Appeals issued its opinion in People v. Calderon on Thursday, October 23, 2014.

Probation Revocation—Due Process.

In 2012, defendant pleaded guilty to attempted first-degree trespass of an automobile with the intent to commit a crime. He was sentenced to two years of intensive supervised probation, with ninety days in jail.

A few months later, defendant’s probation officer filed a probation revocation complaint. At the revocation hearing, the officer testified she had never met with defendant because he had been released to jail directly into the custody of Immigration Customs Enforcement (ICE). The district court found that defendant had violated the terms of his probation and resentenced him to two years of intensive supervised probation. Defendant filed a motion for reconsideration, which was denied.

On appeal, defendant argued that his due process rights were violated when his probation was revoked based on a violation of a condition of probation. He claimed he did not receive either notice of the probation conditions when he was sentenced to probation, or written notice of those conditions in the revocation complaint. It was undisputed that defendant did not receive written notice of his probation conditions, and there was no evidence that defendant had actual notice of the probation conditions. Therefore, the Court of Appeals reversed the order revoking probation.

The Court further held that defendant was deprived of his due process right to written notice in the revocation complaint of the condition of probation he allegedly violated. Defendant had a due process right and a statutory right to such notice. The orders were reversed and the case was remanded to the district court to reinstate defendant’s original sentence to probation.

Summary and full case available here, courtesy of The Colorado Lawyer.