July 18, 2019

Colorado Supreme Court: Property Titled in Name of Revocable Trust Also Can Be Debtor’s Property

The Colorado Supreme Court issued its opinion in Pandy v. Independent Bank on Monday, June 20, 2016.

Revocable Trust—Settlor—Judgment Lien.

This case principally concerns whether property titled in the name of a judgment debtor’s co-settled revocable trust is subject to a judgment lien against the debtor. The petitioners are co-settlors and co-trustees of a revocable trust that holds title to certain real property in Colorado. Respondent obtained two judgments against one of the petitioners in another state. After domesticating those judgments and recording transcripts of the Colorado judgments, respondent filed an action to quiet title and for a decree of foreclosure. The petitioner moved for judgment on the pleadings, arguing that respondent’s complaint was barred by what the petitioner argued was the applicable statute of limitations set forth in C.R.S. § 13-80-101(1)(k). The district court denied the motion, a division of the Court of Appeals granted leave to file an interlocutory appeal and affirmed that ruling, and the Supreme Court granted certiorari.

The Court concluded that as a settlor of a revocable trust, the petitioner held an ownership interest in the trust’s assets. Accordingly, respondent could properly seek to enforce its judgment against the petitioner in this case, and its action was not barred by the statute of limitations set forth in C.R.S. § 13-80-101(1)(k).

Summary provided courtesy of The Colorado Lawyer.