July 17, 2019

Colorado Court of Appeals: Erroneous Legal Standard Applied in Determining that Apartment Building was Estate Asset and Not Partnership Asset

The Colorado Court of Appeals issued its opinion in In re Estate of Grosboll on Thursday, October 24, 2013.

Probate—Estate—Partnership—Real Property—Statute of Frauds.

In this probate matter concerning the consolidated estates of Jeanette Elizabeth Grosboll and Ashley Nelson Grosboll (collectively, decedents), Jo Ann C. Grosboll, decedents’ daughter, appealed the district court’s order finding that the sales proceeds of Loma Vista Apartments (Loma Vista) were an estate asset rather than an asset of Grosboll Manor, L.L.L.P. (partnership), a limited partnership formed between decedents and Jo Ann. The orders were reversed and the case was remanded.

In 2004, decedents and Jo Ann entered into a limited liability limited partnership by executing a written partnership agreement. When decedents died, Loma Vista was titled in their individual names. Robert Grosboll’s surviving sons contended that Loma Vista was an estate asset because it was titled in decedents’ names, and they were entitled to the sale proceeds of Loma Vista as the residuary beneficiaries of decedents’ estate. Jo Ann contended that, according to the terms of the written partnership agreement and the intention of the partners, Loma Vista was a partnership asset and she was entitled to it as the remaining partner.

As a matter of first impression, the Court of Appeals considered whether real property owned individually by one who enters into a partnership may become a partnership asset without a written conveyance sufficient to satisfy the statute of frauds. A written conveyance from a partner to the partnership is not required because the General Assembly has enacted legislation specifically allowing real property titled in an individual partner’s name to be deemed an asset of the partnership, and because the trust relationship between partners provides adequate protection against fraud in oral agreements making a partner’s real property a partnership asset. Thus, the intention of the partners determines whether such real property is a partnership asset, but a written conveyance is a factor for a court to consider in evaluating that intent. Here, the district court, relying on the statute of frauds, found that because decedents did not execute a deed transferring their individual interest in Loma Vista to the partnership, it was not a partnership asset. Because the trial court applied an erroneous legal standard, the trial court’s order was reversed and the case was remanded for further findings of fact and conclusions of law consistent with this opinion.

Summary and full case available here.

Colorado Supreme Court: Question of Whether Colorado Credit Agreement Statute of Frauds Allows Introduction of Evidence Not Reached Because Credit Agreement’s Terms Unambiguous

The Colorado Court of Appeals issued its opinion in Federal Deposit Insurance Corp. v. Fisher on Tuesday, January 22, 2013.

Contract Interpretation—Ambiguous Contract—CRS §38-10-124(2)—Colorado’s Credit Agreement Statute of Frauds.

The Supreme Court reversed the court of appeals’ holding that a credit agreement between a lender and a bank was ambiguous as to the default interest rate. Because the Court held that the credit agreement was not ambiguous, it did not address whether Colorado’s Credit Agreement Statute of Frauds, CRS § 38-10-124(2), allows for the introduction of extrinsic evidence to resolve a facially ambiguous credit agreement.

Summary and full case available here.