August 13, 2018

Archives for 2018

Tenth Circuit: On Interlocutory Review, Class Certifications Were Not Abuse of Discretion by District Court

The Tenth Circuit Court of Appeals issued its opinion in Menocal, et al. v. The GEO Group, Inc. on February 9, 2018.

The appeal addresses whether or not immigration detainees housed in a private contract detention facility in Aurora, Colorado may bring claims as a class under 18 U.S.C. § 1589, a provision of the Trafficking Victims Protection Act (TVPA) that prohibits forced labor, and Colorado unjust enrichment law.

The GEO Group, Inc. (GEO) owns and operates the Aurora Facility under government contract. While there, the plaintiff detainees (Appellees) rendered mandatory and voluntary services to GEO. Under GEO’s mandatory policies, they cleaned their housing units’ common areas. They also performed various jobs through a voluntary work program, which paid them $1 a day.

The district court certified two separate classes: (1) all detainees housed at the Aurora Facility in the past ten years (TVPA class), and (2) all detainees who participated in the Aurora Facility’s voluntary work program in the past three years (unjust enrichment class). On interlocutory appeal, GEO argues that the district court abused its discretion in certifying each class under Rule 23(b)(3) of the Federal Rules of Civil Procedure. It primarily contended that the Appellees’ TVPA and Colorado unjust enrichment claims both require predominantly individualized determinations, making class treatment inappropriate.

At all times relevant to this appeal, GEO owned and operated the Aurora Facility under contract with the U.S. Immigration and Customs Enforcement (ICE). In operating this facility, GEO implemented two programs that form the basis for this case: (1) the Housing Unit Sanitation Policy, which required all detainees to clean their common living areas; and (2) the Voluntary Work Program, which compensated detainees $1 a day for performing various jobs.

The Aurora Facility’s Sanitation Policy had two components: (1) a mandatory housing unit sanitation program, and (2) a general disciplinary system for detainees who engaged in “prohibited acts,” including refusal to participate in the housing unit sanitation program. Under the mandatory housing unit sanitation program, GEO staff generated daily lists of detainees from each housing unit who were assigned to clean common areas after meal service. Upon arriving at the Aurora Facility, each detainee received a handbook notifying them of their obligation to participate in the program.

Under the disciplinary system, detainees who refused to perform their cleaning assignments faced a range of possible sanctions, including the initiation of criminal proceedings, disciplinary segregation—solitary confinement—for up to 72 hours, loss of commissary, loss of job, restriction to housing unit, reprimand, or warning. The Aurora Facility handbook included an explanation of the disciplinary system and the possible sanctions for refusing to clean. The Appellees alleged that the TVPA class members were all “forced to clean the housing units for no pay and under threat of solitary confinement as punishment for any refusal to work.”

Under the Aurora Facility’s Voluntary Work Program (VWP), participating detainees received $1 a day in compensation for voluntarily performing jobs such as painting, food services, laundry services, barbershop, and sanitation. Detainees who wished to participate in the VWP had to sign the “Detainee Voluntary Work Program Agreement,” which specified that “compensation shall be $1 per day.” Detainees had the additional option of working without pay if no paid positions were available. The complaint alleged that the VWP class members were all “paid one dollar $1 per day for their VWP labor.”

The Appellees filed a class action complaint against GEO in the U.S. District Court for the District of Colorado on behalf of current and former ICE detainees housed at the Aurora Facility. The complaint alleged a TVPA forced labor claim based on the Sanitation Policy, and an unjust enrichment claim under Colorado law based on the VWP. GEO moved to dismiss the complaint under Fed. R. Civ. P. 12(b)(6) for failure to state a claim. Regarding the TVPA claim, GEO argued that the Thirteenth Amendment’s civic duty exception to the prohibition on involuntary servitude should also apply to the TVPA’s ban on forced labor. Regarding the unjust enrichment claim, GEO asserted sovereign immunity as a government contractor because ICE “specifically directed it to establish a voluntary detainee work program and pay the detainees who volunteer for that program $1 per day.” The district court rejected these arguments and denied GEO’s motion to dismiss the TVPA and unjust enrichment claims. GEO moved for reconsideration of the court’s rulings. The court denied the motion, finding that GEO “d[id] not identify any intervening change in controlling law or new evidence previously unavailable” to warrant reconsideration. After prevailing on the motion to dismiss, Appellees moved for certification of a separate class for each claim under Fed. R. Civ. P. 23(a) and (b)(3). GEO petitioned the Tenth Circuit for interlocutory review of the class certifications. Accordingly, only the district court’s order granting class certification—and not its rulings on whether the complaint stated TVPA and unjust enrichment claims—is before us.

The Tenth Circuit reviewed the district court’s decision to certify a class for an abuse of discretion. The Tenth Circuit affirmed the district court’s certification of the TVPA class. GEO contended that the district court abused its discretion in determining that the TVPA class satisfied commonality, typicality, predominance, and superiority. The court did not abuse its discretion as to any of these requirements in certifying the TVPA class.

The Tenth Circuit also affirmed the district court’s certification of unjust enrichment class. GEO argued the district court abused its discretion in determining that the unjust enrichment class satisfies commonality, typicality, predominance, and superiority. The district court reasonably determined that the class members shared the circumstances relevant to the unjustness question and that individual damage assessments would not predominate over the class’s common issues. Its findings on commonality, typicality, and superiority were likewise reasonable and fell within its discretion.

The Tenth Circuit Court of Appeals affirmed the district court’s certification of both classes.

Tenth Circuit: Unpublished Opinions, 8/10/2018

On Friday, August 10, 2018, the Tenth Circuit Court of Appeals issued one published opinion and two unpublished opinions.

Digital Satellite Connections LLC v. Dish Network Corp.

United States v. Carey

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

Finalists Selected for Judicial Vacancies on El Paso County Court

On Thursday, August 9, 2018, the Colorado State Judicial Branch announced the Fourth Judicial District Nominating Commission’s selection of five finalists for two upcoming vacancies on the El Paso County Court. Those vacancies will be effective January 9, 2019, and are occasioned by the retirement of Hon. Regina Walter and Hon. Stephen Sletta.

The five nominees are Meredith Cord, Samuel Evig, Marcus Henson, Chad Miller, and Dulce Denise Peacock. Hon. Meredith Cord is a magistrate in the Fourth Judicial District in Colorado Springs. Samuel Evig is a criminal defense attorney at Dahl Fisher Wilks in Colorado springs. Hon. Marcus Henson is a magistrate in the Fourth Judicial District in Colorado Springs. Chad Miller is a public defender at the Colorado State Public Defender’s Office in Colorado Springs. Hon. Denise Peacock is a magistrate in the Fourth Judicial District in Colorado Springs.

Under the Colorado Constitution, the governor has 15 days from August 9 in which to appoint two of the nominees to the bench. Comments regarding any of the nominees may be emailed to the governor at gov_judicialappointments@state.co.us. For more information about the nominees, click here.

Tenth Circuit: Retroactive Sentence Reduction Inappropriate for Successive Motion on Identical Issue

The Tenth Circuit Court of Appeals issued its opinion in United States v. Green on April 6, 2018.

Green appealed the district court’s decision to deny his second motion for reducing his sentence. Green’s appeal was based on his view that the district court abused its discretion in not considering all of the facts and circumstances of his case for reducing his sentence.

In 2011, Green was sentenced to 130 months’ imprisonment after pleading guilty to three counts of using a communication facility to facilitate the acquisition of cocaine powder in violation of 21 U.S.C. § 843(b). Green was initially indicted on seven counts of possession of cocaine powder and cocaine base with intent to distribute and three counts of using a communication facility to facilitate the acquisition of cocaine powder. He pleaded guilty for the three communication-facility counts, and the district court imposed 130 months’ imprisonment. One of the reasons for the higher sentence was the Defendant’s extensive criminal history spanning over 30 years and including a manslaughter conviction, convictions for distribution of cocaine base, violation of protective order, and distribution of crack cocaine.

Three years later, the base offense level for many drug offenses was reduced by two levels when the U.S. Sentencing Commission promulgated Amendment 782, which was retroactive.

Citing Amendment 782, Green then filed another motion to reduce his sentence under 18 U.S.C § 3582(c)(2), arguing he was eligible for a reduction based on the amendment and the progress he had made while in prison as shown by his transcript listing the courses he had completed. The district court denied the motion, and the Tenth Circuit affirmed the district court’s denial.

Fifteen months after the first appeal, Green filed another motion to reduce his sentence under § 3582(c)(2), again citing Amendment 782 and based on the courses he completed while in prison. With the exception of additional courses, the second appeal was the same as the first appeal. The district court denied this second motion, explaining that Amendment 782 did not mandate relief and that completion of courses did not make a reduction appropriate. Defendant appealed the denial, arguing the district court abused its discretion in not considering all the facts and circumstances of his case, including his clean disciplinary record while incarcerated.

When assessing whether the district court had jurisdiction to consider Defendant’s second motion to modify his sentence under Amendment 782, the Tenth Circuit determined whether 18 U.S.C. § 3582(c)(2) contained a jurisdictional bar to second motions based on the same guidelines amendment, and stated it was a question “of considerable practical importance for judges and litigants.” It noted that courts have an ongoing obligation to determine whether adjudicating a particular case is within their subject-matter jurisdiction, even if neither party argues the court lacks jurisdiction.

In consideration of the Supreme Court’s caution against reckless use of the term “jurisdictional,” the Tenth Circuit Court of Appeals relied on 18 U.S.C. § 3582 for guidance. The government contended § 3582(c)(2) only confers jurisdiction on district courts to consider one motion to modify a sentence under each amendment. Since Defendant had previously filed a motion to modify his sentence under Amendment 782, the government argued that the district court lacked jurisdiction to consider his second motion to modify his sentence under this same amendment.

Absent a clear statement from Congress that any potential bar on the number of motions a defendant may file per amendment is jurisdictional, the Court held § 3582(c)(2) did not divest a district court of jurisdiction to consider a second motion to modify a sentence under the same amendment. The government, however, did not advance any argument that § 3582(c)(2) imposes a non-jurisdictional bar, therefore, this issue was do not addressed.

The Tenth Circuit used a two-step inquiry to determine whether the defendant was eligible for a sentence reduction, and whether a sentence reduction was warranted in accordance with the 18 U.S.C. § 3553(a) factors. The parties did not dispute that Defendant was eligible for a reduced sentence under § 3582(c)(2). Defendant only argued the district court erred in the second step of the § 3582(c)(2) inquiry by holding that a reduced sentence was not warranted upon consideration of the § 3553(a) factors, more specifically that the district court did not consider the courses he completed while he was in prison.

The Tenth Circuit found the district court’s considerations of these factors as “unquestionably appropriate.” The district court then determined that Defendant’s coursework while in prison and certificates of completed coursework did not overcome these considerations. The Tenth Circuit concluded that this determination was well within the district court’s discretion.

Additionally, Defendant argued in his initial pro se brief that the district court did not consider his clean disciplinary record while in prison. The disciplinary record was not presented to the district court, so the Tenth Circuit did not consider Defendant’s clean disciplinary record.

Defendant argued that the Circuit should have remanded to the district court so that the district court may consider the Defendant’s disciplinary record while in prison. In general, a remand for a party to produce additional evidence is inappropriate where the party had full opportunity to present the evidence in the first instance.

The Tenth Circuit affirmed the district court’s order.

Tenth Circuit: Unpublished Opinions, 8/9/2018

On Thursday, August 9, 2018, the Tenth Circuit Court of Appeals issued one published opinion and two unpublished opinions.

United States v. Hill

Farr v. Davis

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

Upward Mobility — Pop Music Style

I had a different post planned for this week, but then I heard a song over the gym soundtrack last week that perfectly illustrates the dynamics of social capital and upward mobility and the perils of the rags-to-riches journey. It also captures an attitude that often accompanies that feeling of having your nosed pressed up against the glass: wanting to move up but feeling blocked. That’s a lot of economics to pack into one pop song, so I just had to feature it.

I talked about all of that in the very first post in this series just a bit over a year ago, when I wondered out loud whether money can make us happy:

I mean, all these famous (and mostly rich) people are entitled to their opinion, but we’d like to find out for ourselves if money could make us happy — we’re pretty sure we could handle it.

Rapper Travie McCoy was pretty sure he could handle it, too. He wrote a song saying so — the one I heard at the gym — then lived his own upward mobility rise, fall, and eventual comeback. His experience couldn’t be more different than that of the 9.9 percenters we heard from last week. Apparently the social capital of the pop music red velvet rope club isn’t the same as the club covered by Forbes.

McCoy teamed up with Bruno Mars to do the song back in 2010. Obama was president, we were just coming off the Great Recession, it was five years after Hurricane Katrina and four years before Bruno Mars did his first Super Bowl halftime. Last time I checked, the song’s official video was closing in on 330 Million views. Obviously it hit a sweet spot. The song made an appearance on Glee— the unofficial version I found had nearly a million views — more hitting a sweet spot.

Judging from what happened next, McCoy might have been wrong about whether he could handle it. A “whatever happened to Travie McCoy?” search suggests his big hit didn’t give him the life or make him the person he visualized in the song. Among other things, there was a steep decline into opioid then heroin addiction, but since then he has clawed his way back into the music scene.

We’ll let the song deliver its economic lessons on its own terms. If you want to take a short break for a catchy tune, you can watch either the official video or the unofficial Glee version below. (The latter is an excellent cover, with the lyrics spruced up for prime time TV, as reflected in the lyrics below.)

I wanna be a billionaire so frickin’ bad
Buy all of the things I never had
I wanna be on the cover of Forbes Magazine
Smiling next to Oprah and the Queen

Oh every time I close my eyes
I see my name in shining lights
Yeah, a different city every night oh right
I swear the world better prepare
For when I’m a billionaire

Yeah I would have a show like Oprah
I would be the host of everyday Christmas
Give Travie a wish list
I’d probably pull an Angelina and Brad Pitt
And adopt a bunch of babies that ain’t never had **it
Give away a few Mercedes like here lady have this
And last but not least grant somebody their last wish
It’s been a couple months that I’ve been single so
You can call me Travie Claus minus the Ho Ho
Get it, hehe, I’d probably visit where Katrina hit
And damn sure do a lot more than FEMA did
Yeah can’t forget about me stupid
Everywhere I go Imma have my own theme music

Oh every time I close my eyes
I see my name in shining lights
A different city every night oh right
I swear the world better prepare
For when I’m a billionaire
Oh ooh oh ooh for when I’m a billionaire
Oh ooh oh ooh for when I’m a billionaire

I’ll be playing basketball with the President
Dunking on his delegates
Then I’ll compliment him on his political etiquette
Toss a couple milli in the air just for the heck of it
But keep the five, twenties tens and bens completely separate
And yeah I’ll be in a whole new tax bracket
We in recession but let me take a crack at it
I’ll probably take whatever’s left and just split it up
So everybody that I love can have a couple bucks
And not a single tummy around me would know what hungry was
Eating good sleeping soundly
I know we all have a similar dream
Go in your pocket pull out your wallet
And put it in the air and sing

I wanna be a billionaire so frickin’ bad
Buy all of the things I never had
I wanna be on the cover of Forbes Magazine
Smiling next to Oprah and the Queen
Oh every time I close my eyes I see my name in shining lights
A different city every night all right
I swear the world better prepare for when I’m a billionaire
Oh ooh oh ooh for when I’m a billionaire
Oh ooh oh ooh for when I’m a billionaire

I wanna be a billionaire so frickin’ bad!

More upward mobility stories coming up — one of them is my own.

Colorado Court of Appeals: Announcement Sheet, 8/9/2018

On Thursday, August 9, 2018, the Colorado Court of Appeals issued 10 published opinions and 12 unpublished opinions.

People v. Monroe

People v. Halaseh

People v. Jones

People v. Davis

People v. McGlaughlin

People v. Joosten

In re Marriage of Morgan

In re Marriage of Tibbetts

People v. Soto-Campos & Flores-Rosales

Summaries of these cases are forthcoming.

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, 8/8/2018

On Wednesday, August 8, 2018, the Tenth Circuit Court of Appeals issued no published opinion and one unpublished opinion.

United States v. McKinney

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

Tenth Circuit: Gas Use that Adversely Affected Prisoners Was Not Excessive Force

The Tenth Circuit Court of Appeals issued its opinion in Redmond v. Crowther on February 9, 2018.

Redmond and the entire plaintiff class (collectively, Redmond) were incarcerated in the Olympus Wing of the Utah State Prison, an inpatient treatment facility that houses prisoners with physical and mental health conditions. It has five divided sections. Section D includes a recreation yard, which is enclosed by four walls and open to the sky. On one of those walls is an intake vent to Olympus’s HVAC unit. The vent takes in air from the recreation yard and circulates it into the cells in sections A, B, C, and D. James Hill is a prisoner housed in Section D. On August 3, 2011, Hill violated prison rules. When an officer tried to discipline him, Hill walked away. The officer ordered Hill to return to his cell, but Hill refused. In response, prison officials ordered all prisoners to return to their cells and locked the doors.

Instead, Hill walked into Section D’s recreation yard and closed the door behind him, causing it to lock. Hill then took of his glasses and began sharpening them on the wall. He declared he would “stick or cut the first pig that came out there,” paced aggressively, swung his arms in the air, swore, and spit at prison officials. In response, Robert Powell, the lead officer on duty that day, called the special operations unit, which Jason Nicholes led. Nicholes and his team planned how to extract Hill. Nicholes considered various options such as using a shield wall, shooting Hill with a rubber bullet, or deploying pepper spray. In the end, however, Nicholes concluded that these paths presented additional risks to staff, so he decided to deploy CS gas. Before doing so, Nicholes examined the recreation yard and looked for risks. He did not notice any, nor did he notice the HVAC vents. With his team in place, Nicholes instructed Hill to submit to a strip search and be handcuffed. He warned Hill that if he did not comply, force would be used. Hill nevertheless continued to respond aggressively.

Nicholes then ordered his team to deploy the CS gas. The plan went smoothly except for a significant problem – the HVAC unit. Because the recreation yard contained the HVAC unit’s intake vent, the vent drew the gas in and pumped it inside the prison. The gas went into the cells in sections A, B, C, and D. It also went into administrative areas. The gas caused a burning sensation in prisoners’ eyes, ears, and noses, and made it difficult for them to breathe. It took about thirty minutes for Powell and other prison officials to evacuate the prisoners in Sections B and C. During the evacuation, Powell went into the recreation yard and confirmed that medical staff were offering assistance to prisoners. Yet when the evacuated prisoners were lined up in the recreation yard, Powell told them: “if any of you sissies absolutely need medical treatment, that’s fine, but if any of you are just going over there to whine and cry, something to that extent, or say, oh, my eyes hurt or something like that, I’m going to put you on lockdown or see about having you removed from this facility. I’m not going to have you wasting time with those complaints. If you’re about to die, that’s one thing.” Two prisoners claim they would have sought medical treatment had Powell not made this statement.

Powell thought the gas had dissipated in these sections. He thus decided to not evacuate Sections A and D at all. To air these sections out, Powell instead opened the ports of the cells’ doors and placed an industrial fan in the doorway. Medical staff also walked around Sections A and D to ask if prisoners needed medical care.

Redmond contends that Powell and Nicholes violated the Eighth Amendment by exposing the prisoners to CS gas and then failing to respond adequately to their resulting medical needs. He also claims Powell, Nicholes, and Crowther violated the Utah Constitution’s unnecessary-rigor clause by exposing the prisoners to CS gas. Redmond specifically claimed four violations: (1) exposing plaintiffs to CS gas, (2) discouraging plaintiffs from seeking medical attention and not permitting them all to leave their cells or to shower, (3) verbally abusing and intimidating plaintiffs, and (4) failing to train prison staff regarding the use of CS gas. The Tenth Circuit found none of Redmond’s Eighth Amendment claims persuasive.

Redmond argued in support of his claim that Powell and Nicholes violated the Eighth Amendment by exposing prisoners to CS gas that when “assessing the claims of innocent bystanders who are not the intended target of force and whose exposure to force does not further the purpose of maintaining and restoring discipline,” the conditions of confinement framework applies. The Tenth Circuit disagreed, finding no viable conditions of confinement claim.

The Tenth Circuit found that Nicholes and Powell were entitled to qualified immunity on the excessive force claim regarding exposing the prisoners to gas. Redmond failed to meet his burden of showing a constitutional violation. And even assuming the officials did, in fact, violate the Eighth Amendment, Redmond failed to show that the right was clearly established.

An excessive force claim involves two prongs: (1) an objective prong that asks if the alleged wrongdoing was objectively harmful enough to establish a constitutional violation, and (2) a subjective prong under which the plaintiff must show that the officials acted with a sufficiently culpable state of mind. Because the record demonstrates the prison officials inadvertently exposed the prisoners to gas, they could not have done so with malicious or sadistic intent. Redmond argues a jury could infer the officers intended to gas all the prisoners, not just Hill, because the officers knew the HVAC unit existed, knew the harmful effects of CS gas, knew the gas should not be deployed in small spaces near buildings and hospitals because it could easily disperse, and would have seen the HVAC unit because it was large and conspicuous. The Tenth Circuit concluded that no reasonable juror could believe that the officers intended to expose any prisoner besides Hill to gas. The gas getting drawn into the intake vent, moreover, caused significant trouble for the officials. The gas went into administrative areas—thus exposing those prison officials to gas – and required a large-scale evacuation of the prison. Given all this, Nicholes’s and Powell’s generalized knowledge about the HVAC system and CS gas’s intended uses and effects are insufficient to create a jury question about their intent.

To determine whether prison officials applied force maliciously and sadistically or, rather, in good faith, the Circuit considered the need for the force, and whether the officers used a disproportionate amount of force. The Circuit initially concluded the prison officials needed to use force. Hill had, after all, locked himself inside the recreation yard and refused to comply with prison officials’ orders. The record demonstrates the officials inadvertently exposed the other prisoners to gas. So the question, then, is whether it was disproportionate to use CS gas to secure Hill, when officers did not realize other prisoners would be incidentally exposed to the gas as well. The Tenth Circuit concluded it was not disproportionately forceful to use CS gas.

Even assuming a constitutional violation occurred, the Tenth Circuit determined the officers would still be entitled to qualified immunity because no case clearly establishes this right. Nicholes and Powell are entitled to qualified immunity on the claim they violated the Eighth Amendment by exposing the prisoners to CS gas. Redmond cannot establish that the officers violated the Eighth Amendment and, even assuming they did, the right would not be clearly established.

Redmond next contended Powell acted with deliberate indifference to prisoners’ serious medical needs in violation of the Eighth Amendment. To establish an Eighth Amendment claim based on inadequate medical care, the prisoner must prove both an objective component and a subjective component. The objective component requires showing the alleged injury is “sufficiently serious.” A delay in medical care is only sufficiently serious if “the plaintiff can show the delay resulted in substantial harm.” The subjective component requires showing the prison official knew the inmate faced a substantial risk of harm and disregarded that risk by failing to take reasonable measures to abate it. The subjective prong is met if prison officials intentionally deny or delay access to medical care or intentionally interfere with the treatment once prescribed. The Circuit found that Redmond failed to meet his burden.

The Tenth Circuit affirmed the district court’s grant of qualified immunity to the officers.

Tenth Circuit: Unpublished Opinions, 8/6/2018

On Monday, August 6, 2018, the Tenth Circuit Court of Appeals issued two published opinions and one unpublished opinion.

Hernandez Lopez v. Sessions

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

Colorado Court of Appeals: District Court May Not Consider Documents Outside Bare Allegations of Complaint when Ruling on C.R.C.P. 12(b)(5) Motion

The Colorado Court of Appeals issued its opinion in Prospect Development Co., Inc. v. Holland & Knight, LLP on Thursday, July 26, 2018.

C.R.C.P. 12(b)(5)—Matters Outside the Bare Allegations of the Complaint—C.R.C.P. 12(b)(5)—Statute of Limitations—Affirmative Defense.

Prospect Development Company, Inc. (Prospect) owned and sold undeveloped lots near Crested Butte. It relied on Holland & Knight, LLP (H&K) to prepare federally mandated property reports for prospective buyers. These reports stated that Prospect was responsible for the costs of constructing roads, sewage systems, and other infrastructure. They also stated that individual lot purchasers would not be responsible for these costs. The reports neglected to disclose that the special district in which the lots were located would purchase the infrastructure from Prospect using property tax revenue from the lots, effectively passing the cost of the infrastructure on to the lot owners.

In 2010, several lot owners complained they were not notified before they purchased that they would ultimately pay for the cost of infrastructure through property taxes. H&K assured Prospect that the reports complied with applicable law. Nevertheless, Prospect entered into a tolling agreement with the lot owners in 2010, agreeing to stay the running of any limitations period applicable to claims the lots owners might have against Prospect. In 2011, H&K withdrew from representing Prospect. In 2013, the lot owners sued Prospect based on its failure to make the required disclosures, and Prospect settled with them in 2015. Also in 2015, Prospect entered into a tolling agreement with H&K to toll claims that Prospect might have against H&K. Prospect sued H&K in 2016, alleging professional negligence. H&K did not answer the complaint but moved to dismiss under C.R.C.P. 12(b)(5), arguing that the statute of limitations barred the claims. H&K attached several exhibits from the underlying litigation between the lot owners and Prospect to support its assertion that the claims had accrued in 2011. Prospect opposed the motion and argued the trial court should disregard the exhibits, or, alternatively, if it did consider the exhibits, it should convert the motion to one for summary judgment and allow Prospect to present its own evidence. The district court granted the motion to dismiss, ruling the claims were time barred.

On appeal, Prospect argued that the district court erred by considering matters outside of the complaint in granting the C.R.C.P. 12(b)(5) motion. A defense based on a statute of limitations is an affirmative defense. H&K’s motion was based on a statutes of limitations defense. Thus, in ruling on H&K’s motion, the district court was not allowed to consider matters outside the bare allegations of the complaint. Here, the district court erred in considering two documents from the underlying litigation that were not part of the bare allegations of the complaint. If the district court wished to consider these documents, it was required to convert H&K’s motion to one for summary judgment. This error was not harmless because when viewed in the light most favorable to Prospect, the complaint’s allegations, and those in two documents that the complaint referred to, established that Prospect’s claims were timely.

The order was reversed and the case was remanded.

Summary provided courtesy of Colorado Lawyer.

Colorado Court of Appeals: Board Correctly Ruled that Contiguous Vacant Parcel Not “Used As a Unit” Within Residential Parcel

The Colorado Court of Appeals issued its opinion in Twilight Ridge, LLC v. Board of County Commissioners on Thursday, July 27, 2018.

Property Tax—C.R.S. § 39-1-102(14.4)(a)Used as a UnitVacant Land.

The Robinsons are the sole members of Twilight Ridge, LLC (Twilight), a Colorado limited liability company. In 2013 Twilight purchased two contiguous platted parcels of land in La Plata County. The first parcel has a home on it (the Residential Parcel). The second parcel is a 0.763 acre buildable but undeveloped lot (the Subject Parcel).

The La Plata County Assessor classified the Subject Parcel as vacant land. Twilight appealed the decision for the 2014 to 2015 tax years to the Board of County Commissioners of La Plata County and it appealed the decision for the 2016 tax year to the Board of Equalization for La Plata County, arguing to both bodies (collectively, the County) that the Subject Parcel should be reclassified as residential land. The County upheld the County Assessor’s classification.

Twilight appealed to the Board of Assessment Appeals (BAA). At a consolidated hearing, Mr. Robinson testified that he and his wife bought the two parcels together so that the Subject Parcel would give them privacy, serve as a buffer to prevent any potential house built on the subject property from impeding their views, and provide a place for their grandchildren to play when they visited. Further, although he was currently offering only the Residential Parcel for sale, Robinson intended to sell both parcels together.

Twilight also offered testimony by the Colorado Division of Property Taxation’s deputy director, who was designated by the Property Tax Administrator (PTA) to testify regarding the Division’s policies as embodied in the PTA’s Assessors’ Reference Library (ARL). The County provided the testimony of its appraisers, who had visited the parcels and seen no activity or evidence of use on the Subject Parcel when she visited. The La Plata County Assessor also testified that using the Subject Parcel as a place for children to play and protect a view were “incidental” uses and not the “integral” use of the Subject Parcel in conjunction with the residential improvements that would warrant classifying it as residential. The BAA upheld the County’s classification.

On appeal, Twilight argued that the BAA misconstrued the “used as a unit” element of C.R.S. § 39-1-102(14.4)(a) and made clearly erroneous findings of fact. The BAA’s conclusion that Twilight did not satisfy its burden of proving that the Subject Parcel was used as a unit with the residential parcel is consistent with the ARL and the testimony at the hearing that “used as a unit” contemplates integral, not merely incidental, use.

The orders were affirmed.

Summary provided courtesy of Colorado Lawyer.