May 23, 2018

Colorado Court of Appeals: Plaintiff Need Not Post Bond in Every Land Use Appeal Under C.R.C.P. 106

The Colorado Court of Appeals issued its opinion in Stor-N-Lock Partners Inc. v. City of Thornton on Thursday, May 3, 2018.

Administrative Law—C.R.C.P. 106—Specific Use Permit—Zoning Regulations—Evidence—Bond—Preliminary Injunction.

Plaintiff, Stor-N-Lock Partners #15, LLC (Stor-N-Lock), owns a self-storage facility located in the City of Thornton (the City). The Stor-N-Lock facility is located next to vacant property. Defendant Resolute Investments, Inc. (Resolute) contracted to buy the vacant property and then sought a specific use permit from the City to operate a self-storage facility there. The City granted the permit. Stor-N-Lock appealed the City’s decision to the district court under C.R.C.P. 106. While the case was pending in district court, Resolute filed a motion to require Stor-N-Lock to post a bond, theorizing that by filing the Rule 106 action, Stor-N-Lock had effectively obtained an injunction. The district court summarily denied the motion and affirmed.

On appeal, Stor-N-Lock argued that the City granted the permit in violation of its own zoning regulations, because the City failed to find that Resolute’s use of the property as a self-storage facility enhanced Stor-N-Lock’s property. However, the record evidence supports the City Council’s determination that the proposed use of the property would contribute to, enhance, or promote the welfare of adjacent properties, including Stor-N-Lock’s property. This evidence was sufficient to clear Rule 106(a)(4)’s low no-competent-evidence bar. Thus, the City Council did not abuse its discretion in granting the permit.

On cross-appeal, Resolute argued that although Stor-N-Lock did not seek a preliminary injunction, and the district court did not enjoin Resolute’s use of the property in any way, Stor-N-Lock should nonetheless have been ordered to post a bond when it initiated its Rule 106 action in the district court. Resolute argued that the mere filing of the action increased the financial risk associated with the project and thus created an “effective stay” of its development plan. However, a plaintiff is required to post a bond only when a restraining order or preliminary injunction has been entered . Here, Stor-N-Lock did not seek injunctive relief or a temporary restraining order and therefore was not required to post a bond. The district court did not err in denying Resolute’s motion to require security.

The judgment was affirmed.

Summary provided courtesy of Colorado Lawyer.

Colorado Court of Appeals: Land Parcels Only Contiguous If They Touch, so Parcels Separated by Public Right-of-Way Not Contiguous

The Colorado Court of Appeals issued its opinion in Bringle Family Trust v. Board of Assessment Appeals on Thursday, May 3, 2018.

Property Tax—Classification—Residential—Vacant—Contiguous.

The Bringle Family Trust (Trust) owns two parcels of land in Summit County that are platted lots in the Bills Ranch Subdivision. The “residential parcel” is separated from the “subject parcel” by a road. This road is a public right-of-way maintained by the Bills Ranch Subdivision Association. In early 2016, the Trust petitioned the Board of County Commissioners of Summit County (the County) for an abatement or refund of taxes, arguing that the subject parcel’s property tax assessment classification should be changed from vacant to residential for tax years 2013 to 2015. The County denied the Trust’s petitions. The Board of County Commissioners (Board) upheld this decision.

On appeal, the Trust contended that the Board erroneously denied its petition by misconstruing C.R.S. § 39-1-102(14.4)(a) to conclude that the subject parcel was not contiguous to the residential parcel or “used as a unit in conjunction with the residential improvements located thereon.” The subject parcel must be contiguous to the residential parcel to be classified as residential property for tax purpose. Parcels are contiguous only if they touch. The Trust’s subject and residential parcels are distinct parcels separated by a public road that the Trust does not own. The Trust failed to show that the subject parcel meets the C.R.S. § 39-1-102(14.4)(a) contiguity requirement, and thus the Board correctly declined to reclassify the subject parcel as residential property. Given this determination, the court of appeals did not address the Trust’s contention that the subject parcel meets the “used as a unit” requirement.

The Board’s order was affirmed.

Summary provided courtesy of Colorado Lawyer.

Colorado Court of Appeals: Easement Deed Valid Even Without Description of Dominant Estate

The Colorado Court of Appeals issued its opinion in City of Lakewood v. Armstrong on Thursday, December 28, 2017.

Real Property—Easements Appurtenant—Dominant Estate—Servient  Estate—Statute of Frauds—Constructive Notice—Extrinsic Evidence—Reverter Clause.

In 1984, Mackey executed a deed (Mackey deed) purporting to convey to Jefferson County a permanent public easement over a portion of the southeast corner of her property. Jefferson County executed a deed to the City of Lakewood (Commissioners deed) conveying the Mackey deed easement using the same legal description. The Commissioners deed contained a reverter clause that required Lakewood to use the easement exclusively for public open space, park, and recreational purposes. In 2011, the Armstrongs bought the property from Mackey’s successor in interest and occupied it. After the Armstrongs attempted to obstruct the easement’s use by locking a gate at one entrance to it, Lakewood filed suit. The district court entered summary judgment for Lakewood, finding that the easement was a valid express easement appurtenant.

On appeal, the Armstrongs asserted that the district court erred in granting Lakewood’s motion for summary judgment because the Commissioners deed violates the statute of frauds and is void for failing to legally describe the easement itself or the dominant estate. An easement does not require the precise description that a possessory interest does. While an instrument must identify with reasonable certainty the easement created and the dominant and servient estates, no particular words are necessary. Here, although the Commissioners deed does not expressly describe a dominant estate, it describes the entire servient estate and describes the easement itself with reasonable certainty and is not rendered invalid by any deficiency in the easement’s description. Further, the easement was recorded in the Jefferson County Clerk and Recorder’s Office over 25 years before the Armstrongs’ purchase of the property. Therefore, the Armstrongs had constructive notice of the easement.

The Armstrongs also contended that the district court impermissibly looked to extrinsic evidence to interpret the Commissioners deed. However, a court may consider extrinsic evidence to determine whether the description of an easement in a deed is reasonably certain or instead is invalid for vagueness. The district court did not err in considering undisputed extrinsic evidence to determine that the easement’s description encompassed the entire servient estate and what, if any, dominant estate the easement served for the purpose of determining whether the easement was identified with reasonable certainty and was therefore valid.

The Armstrongs further contended that the district court erred in enforcing the Commissioners deed because the reverter clause in the deed had been triggered, so the deed expired. The easement’s use is the determinative factor for triggering the reverter clause, not the zoning of the land benefited. Lakewood produced undisputed evidence showing that the dominant estate served by the easement has been continuously used exclusively for public open space, park, and recreational purposes. The reverter clause was not triggered.

The Armstrongs additionally argued that the Commissioners deed was void because Jefferson County did not have the authority to purchase the easement for use by Lakewood. Here, Jefferson County had the authority to purchase an easement for access to a public park or open space owned by Lakewood under its implied powers to promote public projects or public open space and parkland.

The order was affirmed.

Summary provided courtesy of Colorado Lawyer.

Colorado Court of Appeals: Hunting and Fishing Club, Not Individual Members, is True Landowner and Bears Tax Burden

The Colorado Court of Appeals issue its opinion in HDH Partnership v. Hinsdale County Board of Equalization on Thursday, October 19, 2017.

Taxation of Hunting and Fishing Memberships—County Assessment—Real Property Taxes.

Owners of fishing and hunting memberships (petitioners) were taxed on the parcels of real estate allocated to them in their membership agreements. The parcels are part of a larger tract of land used as a hunting and fishing club (club). Membership in the club is granted to those who hold a deed to one of the parcels that collectively comprise the club grounds. Members cannot make improvements on their parcels or exclude other club members. The club retains control over the grounds and grants all members equal access, regardless of the parcel to which they hold title. A member’s right to access the grounds can be revoked if the member owes money or violates club rules.

Petitioners initiated this action after they disagreed with the county’s assessment of their parcels. The Hinsdale County Board of Equalization (BOE) affirmed the assessor’s valuation. Petitioners appealed to the Board of Assessment Appeals (BAA), which affirmed the BOE’s decision.

On appeal, petitioners argued that the law permits the court to look beyond the title to the substance of the parties’ rights when determining ownership. The Colorado Court of Appeals concluded that the club was the true property owner because it enjoyed the most significant incidents of ownership. The members effectively had a license to use club grounds, even though they held bare legal title to the parcels. Therefore it was the club, and not the members, that had to bear the real property tax burden. Further, the BAA erred in affirming the assessor’s valuation because it was based on the personal property value of petitioners’ licenses to use club grounds rather than the value of the parcels as real property.

The order was reversed and the case was remanded with directions.

Summary provided courtesy of Colorado Lawyer.

Colorado Court of Appeals: District Court Correctly Characterized Water Storage Plan as Frustrated Plan in Condemnation Action

The Colorado Court of Appeals issued its opinion in Board of County Commissioners of County of Weld v. DPG Farms on Thursday, June 15, 2017.

Condemnation—Highest and Best Use—Lost Income—Costs.

The Board of County Commissioners of Weld County (the County) filed a petition in condemnation to extend a public road over 19 acres of DPG Farms, LLC’s 760-acre property (the property). When condemnation proceedings were initiated, the property was used primarily for agricultural and recreational purposes. The parties stipulated to the County’s immediate possession of the 19 acres and proceeded to a valuation trial. The dispute centered on the highest and best use of 280 acres that contained gravel deposits. DPG’s experts testified about the highest and best use of the property. The district court determined, as a matter of law, that the evidence was too speculative to support a finding that water storage was the highest and best use of the relevant area (Cell C); instead, it determined that the highest and best use of those acres was gravel mining, but not water storage as well. The jury awarded DPG $183,795 in damages for the condemned property and nothing for the residue. DPG then requested costs. The district court rejected a substantial portion of the costs on grounds that they were disproportionate to DPG’s success and that certain expert evidence had been excluded.

On appeal, DPG contended that the district court erred in rejecting water storage as the highest and best use of certain portions of the property. The Court of Appeals reviewed the evidence that the district court’s determination was based on and concluded that the district court did not err in determining, as a matter of law, that the evidence was too speculative to support a jury finding that water storage was the highest and best use of Cell C.

DPG also argued that the trial court erred in excluding evidence of lost income, arguing that it was admissible pursuant to an income capitalization approach to valuing the property. DPG’s evidence of a potential income stream was admissible not as the measure of its damages but rather as a factor that could inform the fair market value of the property. And both the appraiser and the mining expert testified that the potential income stream from mining informed their fair market valuations. Because the lost income evidence, on its own, did not reflect the proper measure of damages, the district court correctly excluded it.

Finally, because the income valuation evidence presented by DPG’s experts was properly excluded, the district court did not abuse its discretion in limiting DPG’s award of costs on this basis.

The judgment and cost order were affirmed.

Summary provided courtesy of The Colorado Lawyer.

Colorado Supreme Court: Third-Party Claims in Construction Defect Case Timely Under C.R.S. § 13-80-104(1)(b)(II)

The Colorado Supreme Court issued its opinion in In re Goodman v. Heritage Builders, Inc. on Monday, February 27, 2017.

Construction Defects—Statute of Repose—Statute of Limitations.

In this case, the Colorado Supreme Court considered the parameters for timeliness of third-party claims in construction defect cases. The court concluded that such claims are timely, irrespective of both the two-year statute of limitations in C.R.S. § 13-80-102 and the six-year statute of repose in C.R.S. § 13-80-104(1)(a), so long as they are brought at before the 90-day time frame outlined in C.R.S. § 13-80-104(1)(b)(II). Accordingly, the court made its rule to show cause absolute.

Summary provided courtesy of The Colorado Lawyer.

SB 17-097: Broadening Application of Presumption of Conveyance for Adjacent Rights-of-Way

On January 27, 2017, Sen. Beth Martinez Humenik and Rep. James Coleman introduced SB 17-097, “Concerning the Presumption that a Conveyance of an Interest in Land also Conveys an Interest in Adjoining Property Consisting of a Vacated Right-of-Way.”

Under current law, a conveyance by warranty deed carries the presumption that the grantor’s interest in an adjoining vacated street, alley, or other right-of-way is included with the property whose legal description is contained in the deed. However, this presumption does not apply to other types of deeds or to a lease, mortgage, or other conveyance or encumbrance.

The bill removes the language containing the presumption from the warranty deed statute and relocates it, with amendments, so as to broaden the application of the presumption of conveyance of an adjoining vacated right-of-way to include not only warranty deeds but also all forms of deeds, leases, and mortgages and other liens.

The bill was introduced in the Senate and assigned to the Judiciary Committee. It was amended in committee and referred to the Senate Committee of the Whole for Second Reading. The bill passed Second Reading with amendments and passed Third Reading with no further amendments. The bill was introduced in the House and assigned to the Local Government Committee.

Colorado Court of Appeals: Lessee of Real Property Lacks Standing to Challenge Property Tax Determination

The Colorado Court of Appeals issued its opinion in Traer Creek-EXWMT LLC v. Eagle County Board of Equalization on Thursday, February 9, 2017.

Traer Creek-EXWMT (Traer) has been a lessee of property in Eagle County since 2002. Traer has reimbursed the property owner for property taxes each year since assuming the lease. On May 1, 2015, the Eagle County Assessor mailed a notice of valuation to the property owner. Traer initiated the statutory protest and adjustment process to challenge the 2015 valuation. The assessor declined to adjust the valuation, and Traer appealed to the Board, which also upheld the valuation. Traer appealed to district court.

The Board moved to dismiss under C.R.C.P. 12(b)(1) on the theory that a mere lessee does not have standing to challenge a property tax valuation of the sort issued by the assessor. The district court agreed and dismissed the case.

On appeal, Traer argued that because it “owns” a leasehold interest in the subject property, it has standing to protest the valuation. The Colorado Court of Appeals disagreed, finding that the relevant statutes convey standing only to the property owner/taxpayer. The court similarly rejected Traer’s argument that C.R.S. §§ 39-1-102(16) and (14) could be read to grant authority to a lessee to challenge a property valuation. The court concluded that the county assessor did not value Traer’s “property” — i.e., its leasehold interest — instead, the assessor valued the fee interest in the property. Therefore, Traer was not a “person” whose “property has been valued too high.”

Traer also argued it had common law standing because it pays taxes on the property and because the owner had granted it agency authority to challenge the valuation. The court noted that Traer’s argument failed at the outset because when a statute limits standing, the court may not disregard the statute by employing common law notions.

The district court judgment was affirmed.

Top Ten Programs and Homestudies of 2016: Real Estate Law

The year is drawing to a close, which means that the compliance period is ending for a third of Colorado’s attorneys. Still missing some credits? Don’t worry, CBA-CLE has got you covered.

Today, we are featuring the Top Ten Programs and Homestudies for Real Estate Law. There are many great programs offered in the Real Estate area, and CBA-CLE offers several informative books authored by some of Colorado’s preeminent real estate attorneys. Visit cle.cobar.org/Practice-Area/Real-Estate to find the real estate program, homestudy, or book you need.

There are many great programs and homestudies for real estate practitioners, but our top ten are as follows.

10. Landlord Tenant Law: What to Do When Vacancy Rates are Low and Rents are High
While the media focuses on higher rents, the truth is that as inventory in housing grows, more and more Landlords are offering concessions such as free month’s rent and $1000 gift card to offset rent for qualified renters willing to sign a 1 year lease. To stay competitive with amenities in Denver, landlords are adding putting greens, outdoor living areas, composting gardens, dog washes, dog runs, bike maintenance stations, yoga classes, gourmet kitchens, and specialty pools. So landlord and tenant attorneys need to be educated on the current “higher rent” market as well as the coming “overbuilt” market which will again change the dynamics of the housing market tremendously. Order the Video OnDemand here, the CD homestudy here, and the MP3 here. Available for 7 general credits.

9. Mineral Interests: Real Estate Fall Update 2015
Whether you practice in the area of mineral interests or not, if you are a real estate lawyer, you need to know about this area of the law. Although the focus of this program is not fracking, the issue has brought mineral interests to the forefront of the Rocky Mountain legal landscape, and fracking will certainly be a part of the day’s discussion. Order the Video OnDemand here, the CD homestudy here, and the MP3 here. Available for 6 general credits, including 1 ethics credit.

8. Anatomy of a Residential Real Estate Transaction: Know the New CFPB Regulations
Some of the most experienced real estate professionals in Colorado explain residential real estate practice – from offer and acceptance to closing. This is a course not only for the practitioner who is new to the area of real estate, but for anyone who needs to know about the new CFPB regulations. Whether you represent the buyer or seller, you need the right tools. The faculty takes you through common problems that need to be solved, including the appropriate forms, title policy issues, types of conveyance deeds, how to read and land survey … and more. Order the Video OnDemand here, the CD homestudy here, and the MP3 here. Available for 7 general credits, including 1 ethics credit.

7. Anatomy of a Commercial Real Estate Transaction: Real Estate Spring Update 2015
When it comes to a commercial real estate transaction, there is a complex array of materials, forms and buyer/seller due diligence that you need to be aware of to properly and effectively represent the best interests of your clients. The knowledge base of a commercial real estate lawyer comes from many years of training and transaction experience, and involves a general understanding of technical matters. Whether it’s the areas of construction, zoning, environmental issues, leasing or site plan approval, if you’re going to be involved in a commercial real estate transaction, you’ll have to be aware of these many areas, along with the legal ones. The faculty members at the Real Estate Spring Update are the area experts for this myriad of issues in commercial real estate transactions. Order the Video OnDemand here, the CD homestudy here, and the MP3 here. Available for 7 general credits.

6. Foreclosure Law – All the Latest and Greatest
In 2011, Colorado had among the 10 highest foreclosure rates in the nation, according to a report from RealtyTrac Inc. Since then, rising home prices fueled by one of the strongest economies in the nation and low interest rates have caused foreclosures to wane in Colorado and the Denver area. Despite the improvement in Colorado’s economy, and the decrease in foreclosures, real estate lawyers and professionals still need to be aware of Colorado’s foreclosure process, because it is unique compared to other states, and foreclosure is always a consideration when representing clients. Order the Video OnDemand here, the CD homestudy here, and the MP3 here. Available for 7 general credits.

5. HOA Basics: Common Interest Communities
If your clients have purchased a condominium, townhouse or other type of property in a planned development or subdivision, chances are they are obligated to join that community’s homeowners’ association (HOA) and pay monthly or annual HOA fees for the upkeep of common areas and the building. If you represent, or are considering representing, clients who own these types of properties, there are many facets you should be aware of – how do homeowners’ associations work, and what are the rules and regulations if something goes wrong?  This seminar  provides not only an overview of common interest communities, but also the details of collection actions, covenant enforcement, transparency and governance, and much more. Order the Video OnDemand here, the CD homestudy here, and the MP3 here. Available for 7 general credits, including 1 ethics credit.

4. Advanced HOA Issues: Triple Crown, Developer Trifecta, & Changes on the Horizon
Your day will begin with a comprehensive case law and legislative update on the latest in HOA issues. Then you will hear some of the areas of CCIOA that have proven difficult or open to interpretation or are simply messier than some of us might prefer. Next, find out what strategies to use in the case of a stalled development: for example, when a property is foreclosed unfinished or unannexed. Learn what you need to know about Triple Crown, Vallagio and local construction defect ordinances. And that’s not all – learn the latest trends in document drafting in owner-controlled Associations: marijuana, emotional support animals, water/mold Issues, individual assessment, and more. Finally, what changes do the experts see on the horizon? Get the regulatory, developer, and Association perspectives on condominium conversions. Order the Video OnDemand here, the CD homestudy here, and the MP3 here. Available for 7 general credits.

3. 25 Cases Every Real Estate Lawyer Should Know – With Fred Skillern
From the obscure attorney disciplinary case (who would know?) that declares the law on the recording of attorney liens, to the well-publicized Lazy Dog Ranch case that revolutionized how we think about easement disputes (with the assistance of the new Restatement) … from statutory interpretation cases dealing with our common interest communities to cases in equity that at times seem to “rewrite” our statutes … our appellate courts have given us a healthy menu of cases on which real estate lawyers of all stripes can and should feast.  Order the Video OnDemand here, the CD homestudy here, and the MP3 here. Available for 3 general credits.

2. Quiet Title Actions: The Basics Plus Selected Advanced Topics
An action to quiet title is brought to establish a party’s title to real property, thereby “quieting” any challenges to the title. When the cloud on the title is removed, the plaintiff is free of claims against the property. Experienced experts will walk you through the quiet title process. You will learn the mechanics of the quiet title lawsuit, and about the more advanced issues when handling a quiet title case. From service of process and identification of the parties, to the most successful strategies in defending a quiet title action, you will get what you need to best serve your clients. Each homestudy order receives a copy of the CLE book, Colorado Quiet Title Actions, 3rd Edition, as part of the course materials for this program. Please note the book will be provided in PDF. Order the Video OnDemand here, the CD homestudy here, and the MP3 here. Available for 7 general credits.

1. 34th Annual Real Estate Symposium
For the past 33 years, the Real Estate Symposium has been established as an institution not to be missed by any real estate professional in the Rocky Mountain region. Join more than 400 of your friends and colleagues for this once-a-year opportunity to talk about the most important issues you face in your real estate practice today. Order the Video OnDemand here, the CD homestudy here, and the MP3 here. Available for 16 general credits, including 3 ethics credits. SAVE THE DATE! The 35th Annual Real Estate Symposium will be held July 13 through 15, 2017, at the Vail Marriott Resort and Spa.

Colorado Court of Appeals: Treasurer Should Use Diligent Efforts to Notify Occupant of Property Tax Deed

The Colorado Court of Appeals issued its opinion in Red Flower, Inc. v. McKown on Thursday, November 3, 2016.

Kevin McKown owned 320 acres of farmland in rural Baca County. From 2004 to 2011, he had an oral sharecrop agreement with Don Lohrey to farm the property. Lohrey visited the property every week or two to check on his crops, but he lived about ten miles away. McKown failed to pay his county property taxes, and the county treasurer sold tax liens for the real property and the mineral rights. Red Flower bought the liens in November 2007. In August 2010, Red Flower applied for treasurer’s deeds. The treasurer unsuccessfully attempted to notify McKown and published notice in the local paper in September 2010. In December 2010, she issued the deeds to Red Flower.

The following year, Red Flower filed a C.R.C.P. 105 action to quiet title to the property. McKown appeared and defended on the grounds that the tax liens were defective due to insufficient notice to himself and Lohrey. The district court determined the treasurer had made a diligent inquiry to find McKown, and a division of the Colorado Court of Appeals affirmed that ruling, but remanded for determination of whether the treasurer had complied with the separate requirement to notify the property’s occupant, Lohrey. On remand, the district court struggled with the statutory language, and ultimately concluded that the treasurer’s notice to Lohrey was deficient and the tax deeds were void.

Red Flower appealed, arguing that the district court’s construction cannot be squared with the language or intent of the statutory scheme. The court of appeals agreed with Red Flower that the district court’s reasoning was incorrect as to the mineral deed. After analyzing C.R.S. § 39-11-128, the court concluded that it was illogical to require the treasurer to put forth more effort to locate the occupant of the property than the property owner. The court, however, noted that it was presumed that the occupant of the property could be found on the property. The court found that the district court correctly concluded that treasurer need not conduct “diligent inquiry” to determine the location of the occupant, but it erred in determining that the treasurer had some limitless duty to locate the occupant. The court instead may simply serve notice to occupants at the property. Because Lohrey was not an actual occupant of the property, but the parties stipulated to his occupancy, the court of appeals remanded for a determination of whether the treasurer made a “diligent inquiry” as to his whereabouts before conveying the mineral deed.

As to the real property deeds, the court of appeals found an error in publication. The court noted that the statute requires publication once a week for three weeks, and publication must take place not more than five months nor less than three months before the tax deeds may issue. Because the tax deeds issued less than three months after publication, the notice was deficient. The court declined to say the deeds were void, since the taxing authority had jurisdiction to issue them, but instead determined the deeds were voidable. The court affirmed summary judgment to McKown as to the real property deed.

The court of appeals affirmed in part, reversed in part, and remanded for further proceedings.

Colorado Court of Appeals: Evidence of Project Funds Inadmissible in Condemnation Proceeding

The Colorado Court of Appeals issued its opinion in Town of Silverthorne v. Lutz on Thursday, February 11, 2016.

Matthew Lutz and Edward Lutz (landowners) own a stretch of land over which the Town of Silverthorne wanted to build a trail. The town applied for and received funds from the Great Outdoors Colorado Program (GOCO) to use in construction of the trail. Landowners objected to having a portion of the trail built on their land. The town offered landowners $6,000 to purchase an easement, but landowners did not respond. The town next offered $75,000 for two easements, but landowners again did not respond. The town then filed a condemnation action under its eminent domain powers, and the matter proceeded to an immediate possession hearing and subsequent valuation trial. The district court granted the town’s motion for immediate possession and the landowners were compensated according to the jury’s valuation.

On appeal, the town initially argued the landowners waived any defense by failing to challenge the condemnation proceedings or make a counteroffer. The court of appeals found no error in the district court’s allowance for the landowners to reply to the condemnation proceedings out of time. The court noted, “Technically, there is no need to file an answer in a condemnation case, but it is good practice to do so.” Next, the court addressed the landowners’ assertion that the town was barred from exercising eminent domain power because of its receipt of GOCO funds, and the district court erred in granting the town’s motion in limine to exclude evidence of the source of funds. The court found it was bound by the Colorado Supreme Court’s decision in Pub. Serv. Co. v. City of Loveland, 79 Colo. 216, 233, 245 P. 493, 500-01 (1926), to exclude evidence of the source of funding for the eminent domain action, finding that the source of funds requires analysis of corporate finance which is wholly separate from a home rule city’s eminent domain authority. The court found no error in the district court’s grant of the town’s motion in limine to exclude evidence of the source of funds.

Landowners also argued the town acted in bad faith by planning the development of its trail in such a way as to receive all GOCO funds before commencing the eminent domain action. The landowners argue this is a jurisdictional challenge to the town’s condemnation suit. The court found several flaws with the landowners’ arguments that the town failed to act in good faith, and again affirmed the district court’s decision to exclude evidence of the GOCO funds. The court also rejected landowners’ contention that the district court erred in denying their motion for attorney fees.

The court of appeals affirmed the district court.

Comment Period Open for Proposed Changes to Rule 120

The Colorado State Judicial Branch announced proposed changes to Rule 120 of the Colorado Rules of Civil Procedure, “Orders Authorizing Sales Under Powers.” The changes are extensive, and include changing the title of the rule to be “Orders Authorizing Foreclosure Sale Under Power in a Deed of Trust to the Public Trustee.”A redline of the proposed changes is available here.

The supreme court is now accepting comments on the proposed changes to Rule 120. Comments may be made in writing via email to Christopher Ryan, the Clerk of the Supreme Court, or via U.S. Mail at 2 E. 14th Ave., Denver, CO 80203. Comments must be received no later than 5 p.m. on April 6, 2016. Comments will be posted on the State Judicial website after the close of the comment period.