The Colorado Court of Appeals issued its opinion in McDonald v. Zions First National Bank, N.A. on Thursday, March 12, 2015.
Construction Loan Agreement Dispute—Partial Summary Judgment—Jurisdiction—Motion for New Trial.
In 2007, plaintiff purchased a parcel of land to construct a building on it. He entered into a loan transaction with defendant Zions First National Bank and signed a construction loan agreement (Agreement).
Plaintiff submitted applications for disbursement of loan funds, some of which defendant paid and some which it rejected. Plaintiff alleged defendant’s refusal to disburse all the loan funds required him to pay certain vendors out of his own pocket. Eventually, plaintiff defaulted on the loan and defendant foreclosed on the property.
Plaintiff sued in 2009, alleging defendant breached the Agreement and an implied covenant of good faith and fair dealing. After discovery, defendant moved for summary judgment. Plaintiff filed an unverified response. The trial court partially granted defendant’s motion, dismissing plaintiff’s two substantive claims, but did not issue judgment on defendant’s counterclaims due to genuine issues of material fact. Defendant filed a motion to dismiss its counterclaims without prejudice. The court granted the motions and vacated the trial date. The court also granted defendant’s request for attorney fees pursuant to the Agreement and entered judgment in favor of defendant in the amount of $102,267.75.
Defendant tried to collect from plaintiff for almost three years, during which time defendant filed a notice of removal of the action in the U.S. District Court for the District of Colorado. There had not been an acceptance of that action or a remand from the federal court. On December 23, 2013, defendant requested the trial court certify its order granting partial summary judgment as final.
The Court of Appeals first analyzed whether the trial court had jurisdiction to certify its order as final under CRCP 54(b) and, if so, whether the Court had jurisdiction to review it. Following analysis of the attempt at removal to the federal court, the Court held in a matter of first impression that where a party’s notice of removal indicates, on its face and as a matter of law, that the attempt to remove the case is without the slightest color of right or merit, jurisdiction in the Colorado courts is not divested. Plaintiff had no ability to remove this case to federal court; therefore, jurisdiction was not divested by the filing of the notice of removal. The Court concluded that because only the grant of partial summary judgment was certified as a final order, only challenges to the propriety of that order were properly before it. This disposed of many of plaintiff’s challenges.
The Court then turned to the breach of contract claim and found that there was no genuine issue of material fact because defendant had submitted evidence showing it did not breach its contractual duties and plaintiff had failed to refute this evidence. Plaintiff’s second claim alleged breach of an implied covenant of good faith and fair dealing. Again, there was no genuine issue of material fact because plaintiff submitted no evidence showing such a breach and defendant’s evidence showed no such breach.
Plaintiff also filed three motions under CRCP 59, one of which was accompanied by an affidavit from his real estate agent. The affidavit was not timely filed. The motion did not attempt to demonstrate any evidence that was newly discovered or could not have previously been discovered by the exercise of reasonable diligence. The Court found no abuse of discretion in denying the motions. The summary judgment and order denying motions for a new trial were affirmed.