Holding: The sentencing provisions in the juvenile transfer and direct file statutes do not create an equal protection issue as it relates to the possibility of a probation sentence.
Case Summary: A juvenile can be prosecuted in adult court in two ways: One, by a transfer hearing in juvenile court in which the district attorney petitions the juvenile court to transfer the case to adult court; and two, by direct file in which the district attorney files the case directly in adult court. The circumstances that allow a transfer hearing are limited and the circumstances that allow a direct file are even more limited.
A 16 year-old was convicted of first-degree assault, a crime of violence, and first-degree criminal trespass after his case was transferred from juvenile court to adult court. During the sentencing hearing, the juvenile argued that he was subject to a more severe penalty for a crime of violence conviction under the transfer statute than he would be if his were a direct-file case. The direct file statute states that a juvenile convicted of a crime of violence is not subject to the mandatory minimum provisions in section 18-1.3-406, but the transfer statute does not contain similar language. The juvenile claimed that a direct file juvenile could get probation but a transfer juvenile could not and thus his equal protection rights were violated.
The Supreme Court found the difference between the transfer statute and direct file statute immaterial to the issue of whether probation is a possible sentence. The direct file provision does not permit a probation sentence for a direct file juvenile, it only excludes the juvenile from the mandatory minimum sentence that begins at least at the midpoint of the presumptive range. The court can sentence the juvenile below the midpoint of the presumptive range but still has to sentence the juvenile to incarceration. In a transfer case, the court must sentence the juvenile to incarceration starting at the midpoint of the presumptive range. So, a juvenile convicted of a crime of violence in adult court either as result of a transfer or direct file must be sentenced to incarceration and thus is not eligible for probation, so there is no equal protection violation.
Although there was no equal protection violation related to a possible probation sentence, there is a difference in incarceration sentencing for a juvenile convicted of a crime of violence in adult court depending on whether the juvenile is transferred or direct filed. The Court noted that a transfer juvenile is subject to the mandatory minimum sentence of at least the midpoint of the presumptive range while a direct file juvenile can be sentenced below the midpoint of the presumptive range, which could create a equal protection issue. There was no equal protection violation in this juvenile's case because the sentencing court in the juvenile's case declined to apply the mandatory minimum provision to the juvenile's sentence. However, a court that applies the mandatory minimum to a transfer juvenile's crime of violence sentence could violate the juvenile's equal protection rights. (For more information, contact Michael Dohr.)
Holding: In a case of first impression, the court of appeals holds that while piercing the corporate veil is possible between sister companies (horizontal piercing), a prerequisite is piercing the corporate veils between the sister companies and their common parents (vertical piercing).
Case Summary: The defendant, a corporation, owed money to the plaintiff, an individual; the debt was subordinated to a senior debt. Entities that share common shareholders, owners, or parents are sister companies. When a sister entity of the defendant, a limited liability company, acquired the senior debt, the plaintiff sued to collect his debt from the defendant, arguing, under principles of horizontal piercing of the corporate veil, that the transfer extinguished the senior debt because the defendant and the LLC were alter egos of each other.
The district court held for the plaintiff. The defendant appealed and the LLC intervened in the appeal. The court of appeals reversed.
To pierce the corporate veil in Colorado, a court must conduct a three-part inquiry. First, it must determine whether the corporate entity is the alter ego of the person or entity in issue. Second, upon finding that an entity is the alter ego of its owners, a court must determine whether the corporate fiction was used to perpetrate a fraud or defeat a rightful claim. Third, a court must consider whether disregarding the corporate form would achieve an equitable result. If it finds that the moving party has satisfied this three-part test by a preponderance of the evidence, then it may disregard the corporate identity and impute liability.
Some jurisdictions categorically bar piercing the corporate veil between entities that are not in vertical, or parent-subsidiary, relationships. Current Colorado caselaw does not extend piercing the corporate veil horizontally to sister companies. In jurisdictions where horizontal piercing is recognized, a plaintiff seeking to disregard the corporate formalities separating horizontal affiliates must first pierce the veils separating each entity from their shared corporate parent.
Reverse piercing occurs when a claimant seeks to hold a corporation liable for the obligations of an individual shareholder. Because our supreme court has not explicitly barred horizontal piercing to find that sister entities are alter egos, and it recognizes the doctrine of reverse veil piercing, the court of appeals rejected the defendants' contention that Colorado courts may never pierce the veil to reach sister entities.
However, the court of appeals agreed with the defendants that horizontal veil piercing between sister entities may occur only if (1) the entities share a parent or common owners in the ownership chain and (2) the veils separating each entity from the parent or common owners are first pierced to find that each sister entity is the alter ego of its owners. But here, the plaintiff failed to present any evidence to support the multiple piercings required to disregard the separate corporate identities of the sister entities. Therefore, the trial court erred in allowing horizontal piercing between the defendants. (For more information, contact Thomas Morris.)
Holding: A school district may not restrict a teacher's ability to exercise the right of nonprobationary portability through the use a of a job application and form employment contract that require a teacher to relinquish the right to nonprobationary portability as a condition of employment.
Case Summary: A teacher with nonprobationary status through employment at one school district applied for a position at another school district. Section 22-63-203.5, C.R.S., allows a teacher with nonprobationary status to transfer that status to a new school district (nonprobationary portability). The online application form required the teacher to waive the statute granting nonprobationary portability by clicking on "I agree" before the application could be filed. Also, the second school district's employment agreement stated that the teacher voluntarily waived the teacher's right to assert nonprobationary portability status. After working for the school district for a year, the teacher was not retained and was not offered the procedural dismissal protections of a nonprobationary teacher. The second school district argued that section 22-63-203.5, C.R.S., violated the district's prerogative of local control to offer employment on the terms and conditions that it deems appropriate. The court of appeals held that the second district could not ignore section 22-63-203.5, C.R.S. The second district should have followed the statute or sought a waiver of the statute from the state board of education. (For more information, contact Jeremiah Barry.)
Korean New Life Methodist Church v. Korean Methodist Church of the Americas, Jin Hi Cha, Colorado Court of Appeals No. 18CA1149 (February 6, 2020)
Holding: Neutral principles of law, rather than the polity approach, should be used to resolve whether a local church submitted to the authority of its national denomination and thus whether the local church or the national denomination can control disposition of church property.
Case Summary: A local church incorporated as an independent, nonprofit corporation. Later, the board of directors passed a resolution stating that the church "shall join" a national denomination. The denomination's rules required church property to be registered with the denomination and prohibited property transfers without prior approval. But the local church never amended its articles of incorporation to submit to the control of the denomination or its rules and never registered its property with the denomination.
Eventually, the local church sold its original property and purchased new property without the denomination's permission or approval; the deeds conveying the property did not mention the denomination and the property was titled in the name of the local church. A faction of the local church's board filed a declaration judgment action to require the local church to submit to the denomination's authority, including regarding disposition of the property.
Applicable United States Supreme Court case law construing the first amendment to the United States constitution indicates that courts should not attempt to resolve disputes concerning church doctrine (the so-called "polity" approach), including internal church governance. On the other hand, courts should apply so-called "neutral principles" of law to resolve non-doctrinal issues, even those that require a determination regarding whether a local church has submitted to the authority of a denomination. The issue before the trial court was whether the "polity" approach or the "neutral principles" of law should be applied to the question of whether a local church submitted to the authority of church denomination.
The Colorado Supreme Court, in Bishop & Diocese of Colo. v. Mote, 716 P.2d 85 (Colo. 1986), upheld application of the neutral principles approach in holding that a local church had submitted to a denomination, and thus that the denomination controlled the property in question. The Court of Appeals upheld the trial court's application of the neutral principle approach in finding that the local church never submitted to the denomination and thus continued to be able to control disposition of the local church's property. (For more information, contact Thomas Morris.)
Holding: Prior convictions are elements of felony DUI that must be proved beyond a reasonable doubt.
Case Summary: Police arrested Viburg for suspected DUI. He was charged with felony DUI based on the allegation that he had three or more previous convictions for driving while ability impaired (DWAI) or DUI.
Before trial, Viburg moved for a ruling that his alleged prior convictions were elements of the offense that the prosecutor must prove to a jury beyond a reasonable doubt. The trial court denied the motion, concluding that the prosecutor needed only to prove the prior convictions to the judge by a preponderance of the evidence.
At trial, a jury convicted Viburg of DUI and careless driving. The judge found by a preponderance of the evidence that Viburg had three prior convictions for DWAI or DUI. Based on that finding, the court elevated Viburg’s misdemeanor DUI conviction to a class 4 felony.
The appeals court explicitly repudiates People v. Gwinn, 2018 COA 130, and People v. Quezada-Caro, 2019 COA 155. The court held that prior convictions are elements of felony DUI, and therefore, must be proved beyond a reasonable doubt. A felony is a much more serious matter than a misdemeanor, with more procedural requirements and more serious legal collateral consequences. Therefore, a statute that changes a misdemeanor to a felony does more than increase the penalty for a crime, so it does not fit within any exception to the constitutional requirement that each element of a crime must be proved beyond a reasonable doubt. And the statute requires prosecutors to plead the prior offenses, so the General Assembly intended the prior offense to be an element of felony DUI. (For more information, contact Jery Payne.)
Holding: A plaintiff claiming age discrimination under the Colorado Anti-Discrimination Act (CADA) may not seek compensatory damages because section 24-34-405 (2) and (3)(g), C.R.S., limits the remedies for age discrimination to reinstatement, hiring, back pay, front pay, and other equitable relief only. Such a plaintiff may seek front pay because front pay is an equitable remedy and is not barred by the Colorado Governmental Immunity Act (CGIA). A plaintiff claiming retaliation under the CADA may seek both front pay and compensatory damages because both remedies are equitable remedies that are not barred by the CGIA and because section 24-32-405 (8)(g), C.R.S., exempts CADA claims for compensatory damages from the CGIA whether the claims are made against the state itself, a state agency, or a political subdivision of the state.
Case Summary: A former employee of the El Paso County Sheriff's Office (EPSO) filed CADA claims against EPSO for age discrimination and retaliation and sought front pay and compensatory damages for both claims. EPSO filed a motion to dismiss the claims on the grounds that compensatory damages and front pay are legal remedies that lie or could lie in tort and are barred by the CGIA. The district court denied the motion to dismiss, concluding that front pay is an equitable remedy not barred by the CGIA and that amendments made to the CADA in 2013 clarified that CADA claims for compensatory damages are not barred by the CGIA.
On appeal, a division of the Colorado Court of Appeals first held that the plain language of CADA, specifically section 24-34-405 (2) and (3)(g), C.R.S., limits the remedies for age discrimination to reinstatement, hiring, back pay, front pay, and other equitable relief only and that plaintiff therefore could seek front pay, but not compensatory damages, for his age discrimination claim. Turning to the plaintiff's retaliation claim, the court of appeals first acknowledged that another division of the court of appeals had, in Houchin v. Denver Health, 2019 COA 50M, held that the CGIA bars CADA claims for compensatory damages asserted against political subdvisions of the state because: (1) compensatory damages are not an equitable remedy and (2) Section 24-34-405 (8)(g), C.R.S. exempts a CADA claim for compensatory damages from the CGIA only when the claim is made against "the state", meaning the state of Colorado or an agency of the state of Colorado, and not when the claim is made against a political subdivision of the state.
The court of appeals disagreed with the Houchin court, holding that the CGIA does not bar the plaintiff from seeking compensatory damages for retaliation because: (1) the compensatory damages allowed under the CADA do not relieve tort-like personal injuries, are merely incidental to the CADA's primary purpose of ending discrimination, and therefore do not lie in tort and are not subject to the CGIA and (2) the word "state", as used in section 24-34-405 (8)(g), C.R.S., refers to all state entities able to seek immunity under the CGIA, including political subdivisions of the state. The decision creates a conflict in the court of appeals as to whether a CADA claim for compensatory damages that is made against a political subdivision of the state is barred by the CGIA. (For more information, contact Megan Waples.)
Holding: A defendant has a right to be present at a restitution hearing.
Case Summary: Defendant was convicted of first degree assault for stabbing the victim. The trial court imposed a sentence to the custody of the Department of Corrections and gave the prosecutor sixty days to file a notice of restitution. The prosecutor timely sought restitution to compensate the Crime Victim Compensation Fund. Defense counsel appeared at the restitution hearing without defendant. The hearing went forward and the trial court awarded the amount requested. Defendant appealed the decision arguing the trial court erred by proceeding with the restitution hearing in his absence. The Court of Appeals reasoned that Colorado Rule of Criminal Procedure 43(a) and both the United States and Colorado Constitutions guarentee the right of a criminal defendant to be present at all critical stages of the proceeding. Sentencing is considered a critical stage of a criminal proceeding and since restitution is a part of the sentencing process, the Court of Appeals held the defendant had a right to be present at the restitution hearing. The Court vacated the restitution order and remanded the case. (For more information, contact Shelby Ross.)
Holding: The statute and rules governing plea agreements require the trial court to exercise its independent judgment in deciding whether to accept or reject sentence concessions in the agreement and allow the defendant, but not the prosecution, to withdraw from a plea agreement when the trial court rejects a sentence concession after the defendant has pled guilty.
Case Summary: The People (prosecution) charged defendant Christopher Mazzarelli with knowing or reckless child abuse resulting in serious bodily injury to his infant son, a class 3 felony. Defendant and the prosecution agreed to a plea agreement under which defendant pled guilty to criminally negligent child abuse resulting in serious bodily injury, a class 4 felony, and the prosecution agreed to dismiss the original charge. The plea agreement also included a sentence stipulation that the defendant would receive a prison sentence within the extraordinary risk crime range of 2 to 8 years.
The trial court accepted the defendant's guilty plea but rejected the stipulated 2 to 8 year prison sentence and instead sentenced defendant to supervised probation. The trial court also rejected the prosecution's request to withdraw from the plea agreement. The prosecution appealed, arguing that it should have been allowed to withdraw from the plea agreement because the trial court had substantially modified the terms of the agreement, and the Colorado Court of Appeals (court of appeals) affirmed. The Colorado Supreme Court (supreme court) granted certiorari to determine whether "the court of appeals erred in upholding the trial court's actions as a matter of law and finding that it could sentence the defendant outside the stipulated sentencing range contained in a plea agreement and accepted by all parties."
The supreme court vacated the court of appeals' decision in its entirety because it did not agree with its reasoning, but, like the court of appeals, upheld the trial court's decision not to allow the prosecution to withdraw from the plea agreement. The supreme court held that "the statute and rules [governing plea agreements in Colorado] (1) require the trial court to exercise its independent judgment in deciding whether to accept or reject sentence concessions in a plea agreement, and (2) allow the defendant, but not the People, to withdraw from a plea agreement when the trial court rejects a sentence concession after the defendant has pled guilty." In support of its holding, the supreme court quoted both language in section 16-7-302 (3), C.R.S., and Colorado Rule of Criminal Procedure 11 (f)(5) stating that [n]otwithstanding the reaching of a plea agreement between the district attorney and defense counsel or defendant, the judge in every case should exercise an independent judgment in deciding whether to grant charge and sentence concessions[,]" and language in Colorado Rule of Criminal Procedure 32 (d) (rule 32 (d)) stating that when a court rejects a sentence concession it "shall so advise the defendant and the district attorney and then call upon the defendant to either affirm or withdraw the plea of guilty." The supreme court clarified that in the context of plea agreements, "sentence stipulations," "sentence agreements," "sentence concessions," and other similar terms are "nothing more than sentence recommendations that the trial court is free to accept or reject, including after the defendant's guilty plea," and that the statute and rules prohibit the prosecution and a defendant from entering into a plea agreement limiting this sentencing discretion of the trial court.
The supreme court also rejected the argument that the doctrine of separation of powers, under which an executive branch prosecutor has sole discretion to make criminal charging decisions, prohibits a trial court from accepting a guilty plea, but not the punishment stipulated in the plea agreement, without allowing the prosecution an opportunity to withdraw from the agreement. The supreme court observed that defendant pled guilty to an offense chosen as part of the prosecution's charging decision to offer a plea agreement and that the court then made a separate sentencing decision that was within its judicial purview under the applicable statute and rules. Finally, the supreme court acknowledged that its holding is inconsistent with the current practice in many trial courts and indicated that if the applicable statute and rules were amended in the future, it would apply them as amended. (For more information, contact Michael Dohr.)
Holding: The warrant requirement of section 13-45-101 (1), C.R.S., is not a jurisdictional requirement requiring summary dismissal for noncompliance.
Case Summary: Petitioner Richard Jones filed a habeas corpus petition in district court challenging the department of corrections' (DOC) calculation of his parole eligibility date. Petitioner argued that the DOC erred in calculating the date using his 2008 conviction and that the DOC instead should use his 1991 convictions to calculate his parole eligibility date. The petitioner claimed that if the DOC used his 1991 convictions to calculated his parole eligibility date, then he was already being held unlawfully past his parole eligibility date. The petitioner included the warrant for his 2008 conviction with the petition but not the warrant for the 1991 convictions. Section 13-45-101 (1), C.R.S., requires that a habeas corpus petition include the applicable warrants.
Four previous Colorado Supreme Court cases held that the warrant requirement is jurisdictional. Butler v. Zavaras, 924 P.2d 1060 (Colo. 1996), Evans v. District Court, 572 P.2d 811(Colo. 1977), Garrett v. Knight, 480 P.2d 569 (Colo. 1971), and McNamara v. People, 410 P.2d 517 (Colo. 1966). Based on those decisions, the trial court dismissed the petitioner's habeas corpus petition.
The Colorado Supreme Court reversed the trial court and overruled the previous supreme court decisions that had held the warrant requirement to be jurisdictional. The supreme court determined that the language of section 13-45-101 (1), C.R.S., does not limit a court's jurisdiction to hear habeas corpus cases and that the warrant requirement is instead simply a statutory procedural requirement. (For more information, contact Michael Dohr.)
Holding: A proposed one-sentence initiative to repeal the Taxpayer's Bill of Rights, article X, section 20 of the Colorado constitution (TABOR) in its entirety has a single subject.
Case Summary: Article V, section 1 (5.5) of the Colorado constitution requires every proposed initiative to have a single subject, which must be clearly expressed in its title. Before setting a title for a proposed initiative, the title board must first find that the proposed initiative has a single subject.
Initiative proponents proposed an initiative, 2019-20 #3 (initiative #3), to repeal the Taxpayer's Bill of Rights (TABOR) in its entirety. The full text of the initiative simply states: "In the constitution of the state of Colorado, repeal section 20 of article X". The title board concluded that the initiative does not have a single subject and that it therefore lacked jurisdiction to set a title because prior Colorado supreme court cases had indicated that TABOR includes multiple subjects and that a proposed initiative to repeal a constitutional provision that includes multiple subjects itself includes multiple subjects. Proponents filed a motion for rehearing, but the title board denied the motion and again declined to set a title. Proponents appealed.
The Colorado supreme court reversed the title board, holding that initiative #3 contains a single subject, the repeal of TABOR. The supreme court first noted that the single subject requirement serves the functions of (1) forbidding the treatment of incongruous subject in the same measure, especially the practice of putting together in one measure subjects having no necessary or proper connection, for the purpose of enlisting in support of the measure the advocates of each measure, and thus securing the enactment of measures that could not be carried upon their own individual merits (i.e., preventing "logrolling") and (2) preventing surreptitious measures and apprising the people of the subject of each measure by the title, that is, to prevent surprise and fraud from being practiced upon voters. The court then concluded that the initiative satisfies both functions and therefore has a single subject because it "effectuates one and only one general objective or purpose, namely the repeal of TABOR ... and could not be written more simply or directly. It essentially asks voters a single question: should TABOR be repealed in full?"
In support of its decision, the Colorado supreme court acknowledged that it had stated in multiple prior cases that if a constitutional provision contains multiple subjects, then a proposed initiative to repeal the entire provision also contains multiple subjects. But the court characterized those statements as nonbinding dicta that lacked underlying analysis. The court specifically distinguished In re Proposed Initiative 1996-4, 916 P.2d 528 (Colo. 1996), a case in which the court had concluded that a proposed initiative that would have repealed and reenacted certain individual provisions of TABOR had multiple subjects, from the total repeal of TABOR, without reenactment of any provisions, proposed by initiative #3. The court then declined to adopt the "dicta" for the following reasons: (1) "a one-sentence initiative asking voters to decide if a constitutional provision should be repealed meets all of the requirements of a single subject;" (2) there is "no basis for creating ... a unique single subject rule for efforts to repeal constitutional provisions;" and (3) "concluding that an initiative contains multiple subjects merely because the targeted provision contained multiple subjects effectively makes the original provision impervious to challenge." Having declined to adopt the "dicta", the court concluded that initiative #3 satisfied the single subject requirement.
In a dissenting opinion, two justices rejected the majority's characterization as "dicta" of prior Colorado Supreme court statements that TABOR includes multiple subjects and that an initiative proposing to repeal a constitutional provision that includes multiple subjects itself includes multiple subjects. The dissenters concluded that initiative #3 includes multiple subjects for the following reasons: (1) the single subject requirement applies to all initiatives, including those that only repeal existing constitutional provisions; (2) TABOR includes multiple subjects; (3) the constitutional single subject requirement for initiatives was adopted in 1994 in response to the adoption of TABOR for the purpose of preventing multiple-subject initiatives like TABOR from being placed on the ballot in the future, and allowing initiative #3 to appear on the ballot is thus "directly contrary to the intent of the single subject requirement;" and (4) case law has consistently held that a proposed initiative to repeal a multiple-subject constitutional provision violates the single subject requirement, and the majority had no justification to overrule that case law. (For more information, contact Jason Gelender.)
Holding: Sufficiency of evidence claims may be raised for the first time on appeal and are not subject to plain error review. Therefore, appellate courts should review unpreserved sufficiency claims de novo.
Case Summary: Defendant McCoy was convicted of two counts of unlawful sexual contact while engaged in the treatment or examination of a victim for other than bona fide medical purposes, pursuant to section 18-3-404(1)(g), C.R.S.. McCoy appealed, arguing the prosecution presented insufficient evidence to sustain his convictions. McCoy claimed that he is not a physician and the people were required to prove that he was a physician to sustain his conviction. The People responded that because McCoy had not preserved his sufficiency claim, the appellate standard of review was for plain error, and therefore, the conviction should be upheld.
The court of appeals had to decide what standard to apply since there was both court of appeals precedent that applied the plain error standard and precedent that applied a de novo standard to insufficient evidence claims. In a split decision, the court of appeals affirmed the conviction and applied the de novo review standard to claims of insufficient evidence. The Supreme Court granted cert and affirmed the court of appeals decision declaring that de novo review is the standard for insufficient evidence claims and also overruled all of the court of appeals decisions that applied a plain error standard. (For more information, contact Shelby Ross.)
Holding: The Colorado Supreme Court reversed the Colorado Court of Appeals' opinion that the Division of Workers' Compensation (DWC) abused its discretion by imposing an aggregate fine of $841,200 against a corporation for failure to maintain workers' compensation insurance without first applying a three-part test established in a Colorado case to determine whether the aggregate amount of the fines was excessive under the Excessive Fines Clause of the Eighth Amendment of the United States constitution (Excessive Fines Clause). The Colorado Supreme Court determined that the appropriate test in an Excessive Fines Clause analysis is not the test identified by the Colorado Court of Appeals, but a test that looks at whether each per diem fine is grossly disproportionate to the violation, as set forth in federal case law. The Colorado Supreme Court remanded the case to the Colorado Court of Appeals to return the case to the DWC to determine, under the federal test regarding excessive fines, if each per diem fine imposed was grossly disproportionate to the violation.
Case Summary: Dami Hospitality (Dami), the owner of a Denver motel, failed to maintain workers' compensation insurance as required under the Workers' Compensation Act for extended periods of time totaling 1,698 days. The DWC fined Dami an aggregate amount of $841,200 for the violations, and Dami appealed to the Industrial Claim Appeals Office (ICAO). The ICAO remanded the case to the DWC for consideration whether the aggregate amount of the fines was constitutionally excessive under the three-part test announced in Associated Business Products v. ICAO, 126 P.3d 323 (Colo. App. 2005). The DWC determined that the aggregate amount of the fines was appropriate and not excessive. On appeal, the ICAO affirmed. On further appeal, the Colorado Court of Appeals determined that the DWC abused its discretion by failing to apply the Associated Business Products' factors to Dami's specific circumstances. The DWC appealed to the Colorado Supreme Court.
The Colorado Supreme Court agreed with the Colorado Court of Appeals that (1) the Excessive Fines Clause applies to corporations and (2) Dami's ability to pay is an appropriate consideration in the constitutional analysis. The Court, however, disagreed with the Colorado Court of Appeals' application of the test set forth in Associated Business Products under which test the aggregate amount of the fines imposed is evaluated for excessiveness. The Court reasoned that, because each day that the law was violated is a separate and distinct violation under the relevant statute of the Workers' Compensation Act, the excessiveness of the fines should be assessed on a per diem basis. The Court concluded that the appropriate test is the test set forth in United States v. Bajakajian, 524 U.S. 321 (1998), which test evaluates each per diem fine to determine whether it is grossly disproportionate to the violation. (For more information, contact Jennifer Berman.)
Holding: Solicitation for child prostitution is a specific intent crime.
Case Summary: Defendant was charged with four counts of soliciting for child prostitution with two girls who were minors. After the prosecution presented its case, the defendant moved for acquitals on all four counts, arguing that the prosecution had not presented any evidence to prove that the defendant had solicited or arranged a meeting for the purpose of child prostitution. The prosecution argued that section 18-7-407 prevented the defendant from raising the defense that he did not know the girls' ages. The trial court disagreed, deciding that although the defendant could not present a defense that the girls were of legal age, that did not relieve the prosecution of its burden to show the arrangement was for the purpose of child prostitution. The trial court determined that, based on the photograph of one of the girls, the defendant could have determined she was underage, but there was no photograph of the second girl. So, the court dismissed the two counts related to the second girl. The prosecution appealed.
The court of appeals reviewed the case and found that solicitation for child prostitution is a specific intent crime. The court determined that the phrase "for the purpose of" is the equivalent of "intentionally". So, the prosecution must present evidence that the defendant had the specific intent of soliciting for child prostitution. The court of appeals also agreed that section 18-7-407 prevents a defendant from raising the defense that he believed that the prostitutes were of legal age, but it does not relieve the prosecution of its burden of proving defendant's specific intent to engage in child prostitution.
The court of appeals acknowledged that a different division of the court determined that soliciting for child prostitution is a general intent crime with mens rea of knowingly, but respectfully disagreed with that opinion. See People v. Emerterio, 819, P.2s 516 (Colo.App. 1991). (For more information, contact Shelby Ross.)
Holding: The Colorado Court of Appeals considered the applicability of Colorado's remedial revival statute, section 13-80-111, C.R.S., which tolls (i.e. delays the running of) the applicable statute of limitations for ninety days when a timely filed action has been terminated for a lack of subject matter jurisdiction so that "a new action upon the same cause of action" can be filed. The court of appeals held that because the remedial revivial statute is not itself a source of subject matter jurisdiction, it allows the filing of a new action only if the lack of subject matter jurisdiction arose from a curable defect in the original action and therefore cannot be used to revive a nonjusticiable claim. The court of appeals also found that that phrase "cause of action" in the remedial revivial statute is ambiguous and interpreted it to only revive a claim if: (1) the plaintiff has diligently pursued it; and (2) the defendant has notice of it. A concurring opinion urged the general assembly to clarify the statute's application.
Case Summary: The Colorado Court of Appeals considered whether the remedial revival statute, section 13-80-111, C.R.S., applied to revive a claim for breach of contract brought outside the statute of limitations after a related claim for equitable relief was involuntarily dismissed. The defendant alleged that the new action was not "upon the same cause of action" as required by the revival statute. The court found that the statute was ambiguous, but ultimately agreed with the defendant and upheld dismissal of the case. A concurring opinion urged the general assembly to clarify the statute.
In the underlying dispute, plaintiff West Colorado Motors, LLC, d/b/a Autonation Buick GMC Park Meadows (Park Meadows), brought suit against General Motors (GM) and the executive director of the department of revenue (department). Park Meadows challenged GM's approval of the relocation of another dealership into what Park Meadows alleged was its territory. Park Meadows had first protested the relocation with the department as a violation of GM's statutory obligation under the motor vehicle dealer statutes to reasonably approve or disapprove relocations. Park Meadows asked the department to exercise its statutory authority to resolve actions that allege a statutory violation. The department declined to investigate or hold a hearing on the matter. Park Meadows then brought suit in district court seeking a stay of the relocation, a hearing on the reasonableness of GM's decision, and a cease and desist order, or in the alternative, an order compelling the department to make a determination on the reasonableness of GM's decision.
The district court dismissed the case, finding it had no jurisdiction, and the court of appeals affirmed. The court of appeals held that under the motor vehicle dealer statutes, review of the department's decision to not hold a hearing fell within the court of appeals' exclusive jurisdiction. Therefore, the district court lacked jurisdiction over that claim. It held that the district court also lacked jurisdiction over Park Meadows' claims for equitable relief because the motor vehicle dealer statute allowed Park Meadows to bring an action before the department or in court. Because Park Meadows had sought relief from the department, it was precluded from bringing a separate action in district court. Park Meadows sought review from the Colorado Supreme Court. The court initially accepted the case and then, after the statutes were substantially amended, dismissed it as improvidently accepted.
After the mandate from the supreme court issued, Park Meadows filed the instant action. This action did not seek equitable relief, as the relocation had already occurred. Instead, Park Meadows sought an award of damages for the alleged violation of the motor vehicle dealer statutes and brought a claim for breach of contract. GM moved for dismissal, arguing that both claims were barred by the statutes of limitation. Park Meadows argued that the claims were revived by the remedial revival statute, section 13-80-111, C.R.S., which allows a plaintiff to bring "a new action upon the same cause of action within ninety days" after the original action is involuntarily dismissed for a lack of subject matter jurisdiction.
The district court granted GM's motion to dismiss and the court of appeals affirmed. The court first found that the statutory claim could not be revived because the defect in jurisdiction could not be cured by refiling. The court then considered whether the claim for breach of contract was revived as being "upon the same cause of action" as the original claims for equitable relief. The court found that the phrase was ambiguous and required interpretation. Because the statute is remedial in nature, the court found it should be liberally construed to effectuate its purpose of avoiding the hardships that would result from strict adherence to statutes of limitations and ensuring that cases are decided on the merits. The court held, however, that the statute should only apply to revive claims when (1) plaintiffs have pursued their claims diligently and (2) defendants have knowledge of the claims. The court found that neither criteria was met in this case. Park Meadows knew about the breach of contract claim for three years and failed to pursue it. Moreover, the substantive differences in the breach of contract and equitable claims meant that GM did not have notice of the breach of contract claim. Therefore, the breach of contract claim was not revived.
A concurring opinion urged the general assembly to clarify the ambiguity in the statute, noting that there is no legislative history due to the statute's age and that without guidance, courts will continue to struggle to determine when it should apply. (For more information, contact Nicole Myers.)
Holding: The Court of Appeals upheld the trial court's restitution order. However, even without a request by defense counsel or the prosecution, the trial court should have realized that it was requried to make a finding of extenuating circumstances before granting the prosecution additional time to present its restitution information to the court.
Case Summary: Defendant was convicted of second degree assault with a deadly weapon and sentenced to five years in the custody of the Department of Corrections. At sentencing, the trial court reserved a determination of restitution for ninety- one days pursuant to section 18-1.3-603(1)(b). Ninety-four days after the order of conviction, the prosecution moved for an extension of time to request restitution, but did not show good cause or extenuating circumstances for the delay as required by section 18-1.3-603(2). Defendant did not object to the request. The trial court ordered the restitution and defendant appealed stating the trial court erred in ordering restitution more than ninety-one days after sentencing absent a showing of good cause or extenuating circumstances. The Court of Appeals held that the assertions made by the prosecution were sufficient for a finding of extenuating circumstances so the trial court's failure to make such an explicit finding was not a substantial error. The error did not cast serious doubt on the reliability of the restitution order. In a specially concuring opinion, Judge Taubman stated the statute could be clarified by amending section 18-1.3-603(1)(b) to require the prosecution to make a showing of good cause before the trail court determines that the prosecution may be accorded time to present restitution information pursuant to section 18-1.3-603(2). (For more information, contact Shelby Ross.)
Holding: The Colorado Court of Appeals held that claims for compensatory damages under the law commonly referred to as the Colorado Anti-Discrimination Act (CADA) are subject to the "Colorado Governmental Immunity Act", (CGIA) and that a CADA provision that allows claims for compensatory relief against the "state" does not allow claims for such relief against political subdivisions of the state. The majority determined that this result is not logical or equitable but that it is up to the General Assembly to amend the statute if it did not intend to bar employees of political subdivisions of the state from recovery for legal remedies for their discrimination claims. A dissenting judge determined that the term "state" in the applicable provision of the CADA is ambiguous and applied principles of statutory interpretation to conclude that "state" means the state and its political subdivisions. In addition, the dissenting opinion opined that even if "state" does not include political subdivisions, the distinction violates constitutional equal protection guarantees.
Case Summary: The court of appeals considered whether the plaintiff's CADA claims against Denver Health and Hospital Authority (Denver Health), a political subdivision of the state, are subject to the CGIA. The plaintiff was a former employee of Denver Health whose employment was terminated. Denver Health claimed that it terminated the plaintiff's employment for inappropriate use of confidential patient records. The plaintiff filed a charge of discrimination with the Colorado Civil Rights Division (Division) asserting that the real reasons for his termination were sexual orientation discrimination and unlawful retaliation for asserting his CADA rights. The plaintiff's charge of discrimination was not timely resolved by the Division and the plaintiff filed suit against Denver Health in District Court alleging, among other claims, sexual orientation discrimination in violation of the CADA. Denver Health claimed governmental immunity under the CGIA and moved to dismiss all but one claim. The District Court denied Denver Health's motion ruling that the plaintiff's claims are not barred by the CGIA. Denver Health filed an interlocutory appeal of the District Court's denial of governmental immunity with respect to the CADA claims, arguing that Denver Health is not the "state" within the meaning of section 24-34-405 (8)(g), C.R.S.
Section 24-34-405 (8)(g), C.R.S. states that "[a] claim filed pursuant to [subsection (8) of this section 24-34-405,C.R.S.] by an aggrieved party against the state for compensatory damages for an intentional unfair or discriminatory employment practice is not subject to the [CGIA]." The statute does not define "state" and does not specifically exclude claims against political subdivision defendants from the CGIA. Noting that other provisions of CADA explicitly reference both the state and political subdivisions of the state, the court of appeals interpreted subsection (8) to bar employees of political subdivisions from claims for compensatory damages because the General Assembly did not specifically include them. The majority determined that this result is not logical or equitable but stated that if this is not the test that the General Assembly intended the courts to use, it is up to the General Assembly to amend the statute. Accordingly, the Court of Appeals reversed the District Court's order denying Denver Health's motion to dismiss the plaintiff's CADA claims under the immunity afforded to Denver Health by the CGIA.
A dissenting opinion argues that the majority's interpretation of the word "state" is incorrect, that the undefined term in the applicable statutory section is ambiguous because the General Assembly's use of the word is not uniform throughout the statutes, and that under principles of stutory interpretation, "state" should be interpreted to include political subdivisions. Further, the dissenting opinion argues that it is "nearly inconceivable that the General Assembly intended to broadly expand the remedies under CADA to afford victims of sexual orientation-based discrimination the same remedies available to other protected classes under federal law and at the same time deny those same protections to a multitude of public employees." Finally, the dissent argues that the majority's interpretation of "state" leaves every employee of the state's political subdivisions without legal remedies against unlawful discrimination under the CADA, while affording that same protection to employees who work directly for the state. The dissenting opinion argues that this violates the Federal and state equal protection clauses and that when a court is faced with a constitutional and unconstitutional interpretation of a statute, it must choose the interpretation that renders the statute constitutional. (For more information, contact Nicole Myers.)
Holding: Certification for involuntary short-term mental health treatment entered by a professional person under section 27-65-107 is not a "court order" under section 13-5-142 (1)(c) and a person's information should not be sent to the CBI for forwarding on the National Instant Criminal Background Check System which would subject the person to federal firearms prohibitions. The court ordered that steps be taken to rescind the reporting to the National Criminal Background Check System.
Case Summary: The petitioner sought mental health treatment at a hospital and a physician certified him for involuntary mental health treatment pursuant to section 27-65-107, C.R.S. The certification was filed with the Denver probate court. As a result the Colorado bureau of investigation was notified and the petitioner was added to National Instant Criminal Background Check System (NCIS). The effect was the petitioner was prohibited from possessing a firearm. The petitioner asked the probate court for removal from NCIS, the probate court denied the petition.
Sections 13-5-142 and 13-9-123, C.R.S., require that when a court orders a person into involuntary mental health treatment pursuant to section 27-65-107, C.R.S., the name of the person must be reported to CBI to have the person listed in the NCIS. The state court administrator has also been submitting the names of persons who are certified for involuntary mental health treatment entered by a professional person, like a physician, pursuant to section 27-65-107, C.R.S., to the Colorado bureau of investigation for reporting to NCIS. The result is those persons, like the petitioner, are subject to federal firearms prohibitions.
The petitioner appealed the probate court decision arguing only persons subject to court-ordered involuntary mental treatment may be placed in NCIS. The court of appeals agreed finding the express language of the statue was limited to court orders not professional person orders. (For more information, contact Jerry Barry.)
Holding: It violates a criminal defendant's constitutional right to equal protection of the laws to charge the defendant with both strangulation under section 18-3-203 (1)(i), C.R.S., and a crime of violence sentence enhancer under section 18-1.3-406 (2)(a)(I)(A), C.R.S.
Case Summary: The defendant was charged with strangulation pursuant to section 18-3-203 (1)(i), C.R.S. Later, the prosecution moved to add a crime of violence sentence enhancer pursuant to section 18-1.3-406 (2)(a)(I)(A), C.R.S., to the charge. The trial court court initially granted the motion, but later reconsidered on defendant's motion and dismissed the sentence enhancer, reasoning that it violated the defendant's constitutional right to equal protection of the laws. The prosecution filed an interlocutory appeal of the dismissal, and the Colorado Court of Appeals affirmed the trial court's decision.
The court of appeals found that a person alleged to have strangled someone can be charged with second degree assault (which unlike first degree assault does not require proof that the defendant caused serious bodily harm to the victim) under either subsection (1)(b) or subsection (1)(i) of section 18-3-203, C.R.S. Under subsection (1)(b), the prosecution must prove that the defendant intended to cause bodily injury and caused bodily injury by means of a deadly weapon. Under section (1)(i), the prosecution must prove that the defendant intended to cause bodily injury and applied sufficient pressure to impede or restrict breathing or blood flow by applying sufficient pressure to the neck, nose, or mouth to actually cause bodily injury. The crime of violence sentence enhancer provided for in section 18-1.3-406 (2)(a)(I)(A), C.R.S., requires proof that the crime was committed with a deadly weapon.
The court of appeals found that a person who is charged with strangulation pursuant to section 18-3-203 (1)(i), C.R.S., in combination with the crime of violence sentence enhancer is subject to a more significant penalty than a person charged with strangulation pursuant to section 18-3-203 (1)(b), C.R.S. In both cases, the prosecution must prove that the defendant intended to cause bodily injury, did cause bodily injury, and used a deadly weapon, in this case the defendant's hands. The court of appeals thus found that there is no meaningful distinction in the criminal conduct, but that there is a significant difference in the possible penalty because a defendant charged under subsection (1)(b) could be sentenced to probation while a defendant charged under subsection (1)(i) with the crime of violence sentence enhancer would receive a minimum five-year prison sentence. Because "if two criminal statutes provide for different penalties for identical conduct, a person convicted under the statute with the harsher penalty is denied equal protection of the laws unless there are reasonable differences between the prohibited behaviors," the court of appeals concluded that the difference in possible sentences created an equal protection violation as applied to the defendant. (For more information, contact Michael Dohr.)
Holding: A parcel of land that is contiguous to a commonly owned parcel of residential land that includes a residence qualifies as residential land only if, as specified in section 39-1-102 (14.4)(a), C.R.S., the parcel "is used as a unit in conjunction with the residential improvements," and the passive use of an unimproved parcel for the preservation of unobstructed views from the residence is not a qualifying conjunctive use. The county assessor therefore properly classified the entire parcel as vacant land and the Board of Assessment Appeals erred in reclassifying a portion of the parcel as residential land.
Case Summary: The Martin Family Partnership, LLP (Petitioner) owns two adjacent parcels of land in La Plata County, the west parcel, which the Martins owned in their own names before transferring it to Petitioner in 2015, and the east parcel. The east parcel includes the Martins' residence and the west parcel is an unimproved lot that adjoins the east parcel's western boundary. Section 39-1-102 (14.4)(a), C.R.S., defines "residential land" for purposes of property taxation to include a parcel of land that is contiguous to a commonly owned parcel of residential land that includes a residence only if it "is used as a unit in conjunction with the residential improvements."
For property tax years 2014 through 2016, the county assessor classified the east parcel as residential land and the west parcel as vacant land. Petitioners appealed to the county board of equalization (CBOE) and the board of county commissioners (BCC), which respectively denied both appeals. Petitioners then appealed to the Board of Assessment Appeals (BAA), which: (1) upheld the classification of the west parcel as vacant land for 2014 because in 2014 Petitioner did not own both parcels; and (2) partly reversed the classification of the west parcel as vacant land for 2015 and 2016 by classifying the two-thirds of the west parcel that it determined was used by the Martins to preserve views from the east parcel as residential land. Petitioner appealed the BAA's decision to the extent that it classified the west parcel as vacant land, the CBOE and the BCC appealed the BAA's decision to the extent that it classified the west parcel as residential land, and the BAA argued that its decision was supported by the evidence.
In two separate opinions, a majority of a three-judge panel of the Colorado Court of Appeals held that a parcel of land that is contiguous to a commonly owned parcel of residential land that includes a residence qualifies as residential land only if, as specified in section 39-1-102 (14.4)(a), C.R.S., the parcel "is used as a unit in conjunction with the residential improvements," and that the passive use of an unimproved parcel for the preservation of unobstructed views from the residence is not a qualifying conjunctive use. In addition, one of the judges, expressly declining to apply contrary nonbinding precedents from other divisions of the court of appeals and reading section 39-1-102 (14.3), C.R.S., which defines "residential improvements" for purposes of property taxation, together with section 39-1-102 (14.4)(a), C.R.S., further concluded that "a parcel that is contiguous to one on which there is a residence can be classified as residential land only when it has a 'building, structure, fixture, fence, amenity, [or] water right' that is 'an integral part of the residential use' of the parcel containing the residence." (For more information, contact Jason Gelender.)
Colo. Oil & Gas Conservation Comm'n v. Martinez, Colorado Supreme Court No. 17SC297 (January 14, 2019)
Holding: The Colorado Supreme Court reversed the opinion of the Colorado Court of Appeals that section 34-60-102 (1)(a)(I), C.R.S., mandates the protection of public health, safety, and welfare, including the environment and wildlife resources, as a condition precedent to the regulation of oil and gas development. The supreme court instead found that the Colorado Oil and Gas Conservation Commission (commission) must foster oil and gas development, protecting and enforcing the rights of owners and producers, while also preventing and mitigating significant adverse environmental impacts to the extent necessary to protect public health, safety, and welfare. The supreme court concluded that the oil and gas conservation commission (commission) did not abuse its discretion when it declined to engage in rulemaking to consider a proposed rule that would require it to deny a permit for the drilling of an oil or gas well unless the "drilling can occur in a manner that does not cumulatively, with other actions, impair Colorado's atmosphere, water, wildlife, and land resources, does not adversely impact human health, and does not contribute to climate change" on the grounds that it lacked statutory authority to adopt the proposed rule and was already working with the department of public health and environment to address the concerns to which the proposed rule was directed.
Case Summary: Plaintiffs petitioned the Colorado oil and gas conservation commission (commission) to adopt a rule that would require the commission to deny a permit for the drilling of an oil or gas well unless the "drilling can occur in a manner that does not cumulatively, with other actions, impair Colorado's atmosphere, water, wildlife, and land resources, does not adversely impact human health, and does not contribute to climate change." The commission declined to engage in rulemaking to consider the proposed rule because it determined that it lacked statutory authority to adopt the proposed rule and because it was already working with the Colorado department of public health and environment (CDPHE) to address the concerns to which the rule was directed and needed to prioritize that effort over the proposed rulemaking.
The Denver district court upheld the commission's determination, concluding that section 34-60-102 (1)(a)(I), C.R.S., requires the commission to balance the development of oil and gas resources against the protection of public health, safety, and welfare. The Colorado Court of Appeals reversed based on its analysis of the statute, and concluded that protection of public health, safety, and welfare constituted a condition that must be fulfilled rather than part of a balancing test.
The Colorado Supreme Court reversed the Colorado Court of Appeals' decision and held that the commission did not abuse its discretion when it denied the rulemaking petition. The supreme court found the language of the statute to be ambiguous and based its decision primarily on the statutory history of the provision, including comments made by legislators upon the introduction of various amendments, especially those pertaining to public health and safety. The supreme court concluded that, based on the perceived legislative intent of the statute, the commission must foster the development of oil and gas resources, protecting and enforcing the rights of owners and producers, and, in so doing, prevent and mitigate significant adverse environmental impacts to the extent necessary to protect public health, safety, and welfare, but only after taking into consideration cost-effectiveness and technical feasibility. As such, the protection of public health and the environment is a factor to consider rather than a condition precedent in regulating oil and gas development. (For more information, contact Thomas Morris.)
Holding: The Colorado Court of Appeals reversed the Jefferson County District Court and held that: (1) An executive order does not expire when the term of the governor who issued it ends and instead remains in effect until it is revoked, modified, or superseded by subsequent legal authority; and (2) An executive order that merely instructs an executive branch agency to prosecute certain offenses already established in law is not a legislative act constituting an unconstitutional exercise of legislative power by the executive branch in violation of the principle of separation of powers set forth in article III of the Colorado constitution.
Case Summary: Section 24-31-101 (1)(a), C.R.S., requires the attorney general to "appear for the state and prosecute and defend all actions and proceedings, civil and criminal, in which the state is a party or is interested when required to do so by the governor ...." This statute grants the governor general authority to direct the attorney general to prosecute certain cases.
In 1987, Governor Roy Romer issued Executive Order No. D 0017 87 (executive order). The executive order has not been repealed, rescinded, or modified and it requires the attorney general, through the Medicaid fraud control unit (MFCU) of the office of the attorney general, to investigate and prosecute Medicaid fraud and patient abuse cases.
In December 2017, the attorney general, through the MCFU, filed a felony charge involving neglect of an at-risk adult against Jasmine Salgado, an employee of an assisted living facility, in Jefferson County District Court. The Jefferson county district attorney, who had previously determined that there was insufficient evidence to prosecute Salgado, filed a notice asserting that the attorney general did not have legal authority or jurisdiction to file and prosecute the case because: (1) The executive order was unconstitutional; and (2) Legislation had superseded the executive order.
The district court rejected the argument that legislation had superseded the executive order, but concluded that the executive order was unconstitutional because "a former governor cannot require the current attorney general to act" and because "reliance on the executive order to confer authority in 2018 would be an unconstitutional exercise of legislative power by the executive branch."The attorney general appealed to the Colorado Court of Appeals and Salgado responded.
The Colorado Court of Appeals reversed the district court, holding that the executive order had not expired and that it is not an unconstitutional legislative act. Citing case law from other jurisdictions, the court of appeals noted that the "general rule" is that "executive orders validly issued pursuant to legislative or constitutional grants of authority remain in effect until revoked, modified, or superseded by later authority, and remain in effect beyond the expiration of the term of the governor who issued them." Applying the general rule, the court then determined that neither the language of section 24-31-101 (1)(a), C.R.S., nor any other legal authority support a requirement that an executive order delegating prosecutorial authority to the attorney general include a "temporal and spatial framework" or a "conclusion that executive orders expire along with the term of the issuing governor" or "after the lapse of some undefined period deemed sufficient by a court." Observing that the power of the governor "vests in the office, not the individual person inhabiting the office at any given time" and that an executive order thus "is the mandate of the office of the Governor, not the individual holding the title," the court concluded that "an executive order remains in effect until modified, rescinded, or superseded, and it does not expire merely because the issuing governor is no longer in office." Finally, the court held that because the executive order merely instructs an executive branch agency to prosecute certain offenses already established in law, it is not a legislative act constituting an unconstitutional exercise of legislative power by the executive branch in violation of the principle of separation of powers set forth in article III of the Colorado constitution. (For more information, contact Jason Gelender.)
Holding: Crim. P. 35(c)(3)(VII) supersedes prior case law, which states that a defendant can file a second Crim. P. 35(c) motion raising new postconviction claims if the defendant filed an initial Crim. P. 35(c) motion pro se.
Case Summary: This case involves a postconviction review of a defendant's case. Defendants can file for postconviction relief under Crim. P. 35. Crim. P. 35 sets the procedures, rules, and matters that can be heard in postconviction motion. Prior to 2004, if a defendant filed a 35(c) motion pro se, the defendant could file a second 35(c) motion raising new postconviction claims. In 2004, Crim. P. 35(c)(3)(VII) was adopted which requires a court to deny any claim that could have been presented in an appeal or postconviction proceeding previously brought, with five exceptions. The exceptions do not give a defendant the option to file a second 35(c) motion if the defendant filed the initial 35(c) motion pro se.
Defendant filed a pro se 35(c) motion raising seven claims. The postconviction court denied defendant's 35(c) motion. Defendant then filed a second pro se 35(c) motion, in which he renewed some of the claims from his first motion and raised new claims. The postconviction court held that the duplicative claims from defendant's initial 35(c) motion were barred as successive under Crim. P. 35(c)(3)(VI). However, the postconviction court did not consider the new claims as successive and denied them on the merits. The postconviction court's ruling was appealed. The court of appeals reversed. The court of appeals found that Crim. P. 35 (c)(3)(VII) supersedes prior case law holding that a defendant can raise new postconviction claims in a second 35(c) motion if the first 35(c) motion was filed pro se. (For more information, contact Shelby Ross.)
Holding: A trial court may not impose restitution for pecuniary losses caused by acquitted conduct.
Case Summary: The defendant wrote two checks from his company's bank account to a repair shop for maintenance and repair of his semitruck. The defendant's bank account contained insufficient funds to cover the checks. The defendant was charged with two counts of fraud by check - one count for each check. The defendant admitted that he knew there were insufficient funds to cover the checks when he wrote them. He asserted he did not intend to defraud the repair shop and that he intended to transfer money from another account and get a loan to cover the amounts of the checks. The jury convicted the defendant of the charge related to the first check, but acquitted him of the charge related to the second check. As part of the defendant's sentence, the trial court imposed restitution totaling the amount of both checks.
The defendant appealed the trial court's decision, arguing the restitution related to the second check is barred because he was acquitted on that charge. The court of appeals affirmed, holding that since the defendant was convicted of at least one charge, the trial court could impose restitution for the whole amount since the underlying conduct proximately caused the victim's loss. The supreme court reversed, stating that the plain meaning of section 18-1.3-603, C.R.S., requires a defendant be found guilty of a charge in order to impose restitution. Therefore, a trial court may not impose restitution for pecuniary losses caused by acquitted conduct. The supreme court also stated that it was specifically disapproving of any previous court of appeals opinions that are in conflict with the supreme court's opinion. (For more information, contact Shelby Ross.)
Holding: The Judicial Department may collect interest payments on a monthly basis, rather than annually pursuant to the statutory direction to collect interest on restitution at the rate of twelve percent per annum.
Case Summary: In June 2015, the Judicial Department issued a press release announcing it would begin calculating and assessing 1% interest monthly on restitution balances to ensure consistent and accurate application of the law across the state after a 2014 State Audit report noted that most judicial districts had not assessed or collected any interest since the legislature had enacted the restitution statute. Defendant sued, claiming the Judicial Department did not have the statutory authority to charge monthly interest because the plain language of the statute said otherwise by using the term "per annum". The Court of Appeals held that, although the General Assembly did not define the term "per annum" and there was no legislative history to help ascertain when interest should be collected, others jurisdictions have interpreted similar language to be intended only as a measure of the rate with respect to time and does not require the payment of interest annually. Additionally, if the General Assembly intended to limit interest payments to an annual basis, it would have done so as it did in other statutes. (For more information, contact Shelby Ross.)
Holding: Retroactively assigning a child support obligation for the obligee when a voluntary change in parenting time occurs is affirmed, though the statute remains ambiguous. The district court did not make sufficient findings to support a determination of underemployment.
Case Summary: Mother and father of two children divorced in 2008. After multiple voluntary changes to parenting time, the district court determined that the mother owed retroactive child support, despite having been the obligee of the previous order. Section 14-10-122 (5) addresses changes in parenting time and the associated child support and was amended in 2013. But, those amendments did not resolve the ambiguity as to whether an obligee can retroactively be made an obligor. The court of appeals determined the legislative intent of the 2013 amendments was that an obligee can retroactively be made an obliger. This conclusion affirms the decision of the district court to retroactively grant the father child support from the mother. (For more information, contact Courtney McDonald.)
Holding: In dissolution proceedings, the couple's cryogenically frozen pre-embryos constitute marital property of a special character. Supreme Court developed a framework to balance the parties' interests regarding the disposition of a divorcing couple's cryogenically preserved pre-embryos. The consent referred to in section 19-4-106 (7)(b) refers to the former spouse's consent to legal parenthood, not to their consent to placement of a pre-embryo.
Case Summary: A divorcing couple turned to the court to resolve a dispute over the disposition of their cryogenically preserved pre-embryos. The wife wished to keep the pre-embryos for future in vitro fertilization (IVF). The husband wanted no more genetic children using the pre-embryos and wished to have them discarded. The trial court ruled that the husband's right not to be forced to become a genetic parent outweighed the wife's desire to possibly have more children and awarded the pre-embryos to him. The court of appeals determined that the trial court erred in inferring contract terms that were not explicitly stated in the couple's contracts with the IVF facility to inform their ruling, but concluded that the trial court properly exercised its discretion in balancing the parties' interests and awarding the pre-embryos to the husband.
The supreme court reversed the judgment of the court of appeals, holding that both the trial court and the court of appeals considered inappropriate factors in attempting to balance the parties' interests, and remanded the case back to the trial court. In the absence of legislation regarding the disposition of cryogenically preserved pre-embryos upon the dissolution of marriage, the supreme court provided the following framework for balancing the parties' interests: courts should first look to any existing agreement between the parties regarding the disposition of their remaining pre-embryos in the event of divorce. In the absence of any such agreement, the court should balance the parties' interests by considering the following: (1) how the party who wishes to preserve the pre-embryos intends to use them; (2) the demonstrated physical ability or inability of the party seeking to use the pre-embryos for IVF to have biological children through other means; (3) the parties' original reasons for undertaking IVF; (4) the potential hardship for the party that wishes to avoid becoming a genetic parent, including emotional, financial, or logistical factors; (5) either party's demonstrated bad faith or attempt to use the pre-embryos as unfair leverage in divorce proceedings; and (6) other factors relevant to the parties' specific situation. The court also held that the following considerations are inappropriate: (1) the ability of the party seeking to use the pre-embryos to afford a child, (2) standing alone, the number of a party's existing children, and (3) the party seeking to use the pre-embryos' ability to adopt or otherwise parent non-biological children. (For more information, contact Courtney McDonald.)
Holding: The time value of money does not constitute reasonably equivalent value in an equity-type Ponzi scheme.
Case Summary: Taylor invested money in a Ponzi scheme run by Mueller. Their agreement did not provide any guaranteed rate of return or interest; rather, Taylor was to receive merely a portion of whatever profits might accrue. Taylor received several transfers of "profits" (in reality, merely subsequent investors' principal) from Mueller and later withdrew his entire principal, plus nearly half a million dollars profit. Then the enterprise was exposed as a scam. The trial court appointed Lewis as receiver, who sued to void the profit portion of the transfers to Taylor in order to return the money to investors who lost all of their principal.
Taylor argued that, under the "Colorado Uniform Fraudulent Transfer Act" (CUFTA), he had given "reasonably equivalent value" to Mueller in the form of the time-value of the invested money, and therefore the transfers to him were not voidable. The trial court held for the receiver, and the court of appeals reversed.
The supreme court reversed again, observing that this is an issue of first impression in Colorado. The supreme court found that under CUFTA, the time value of money does not constitute reasonably equivalent value in an equity-type Ponzi scheme. The court contrasted a Ponzi scheme in which an investor has been guaranteed a minimum rate of return or interest; in these situations, a transfer of "profits" or interest satisfies an antecedent debt, which makes the investment of principal a reasonably equivalent value. In these types of Ponzi schemes, a transfer of "profits" or interest is a dollar-for-dollar forgiveness of a contractual debt; such transfers are not voidable. But in an equity-type Ponzi scheme, the innocent investor who profits can point to nothing under CUFTA that ties the false profit to "value" that was provided to the debtor. Because Taylor did not provide any reasonably equivalent value, Mueller's transfers to him of "profits" were voidable. (For more information, contact Thomas Morris.)
Holding: Semen does not constitute an "intimate part", defined in § 18-3-401 (2), for the purposes of establishing "sexual contact", defined in § 18-3-401 (4).
Case Summary: Defendant was convicted of sexual assault on a child (SAOC), sexual assault on a child by one in a position of trust (SAOC-POT), and indecent exposure, based on testimony that defendant ejaculated into the hands of his foster children and then required the children to swallow the semen. To commit the crimes of SAOC and SAOC-POT, the defendant must have "sexual contact" with a child, which requires the knowing touching of the actor's or victim's "intimate parts". The term "intimate parts" is defined as "the external genitalia or the perineum or the anus or the buttocks or the pubes or the breast of any person." The Court of Appeals, applying the plain language of the statute, vacated the defendant's convictions for SAOC and SAOC-POT and held that semen does not constitute an "intimate part" of the defendant's body. (For more information, contact Shelby Ross.)
Holding: The Colorado Supreme Court held that relevant jurisdictional language in article XXIX, section 5 of the state constitution (Amendment 41) authorizes the Independent Ethics Commission (IEC) "to hear complaints involving ethical standards of conduct relating to activities that could allow covered individuals, including elected officials, to improperly benefit financially from their public employment." The court also held that the public trust statute, section 24-18-103, C.R.S., establishes such an ethical standard of conduct and that the IEC therefore has jurisdiction over complaints alleging violations of the public trust. The IEC therefore had jurisdiction over a complaint alleging that former Secretary of State Scott Gessler (Gessler) had misappropriated state funds for personal or political uses.
Case Summary: Section 24-9-105 (1)(d), C.R.S., provides the Secretary of State a $5,000 discretionary account "for expenditure in pursuance of official business ...." Gessler used money in the discretionary account to travel to Florida to attend both an election law seminar hosted by the Republican National Lawyers Association and the Republican national convention. Colorado Ethics Watch filed a complaint with the IEC, alleging that Gessler had misappropriated state funds for personal or political uses and made false statements on expense reimbursement requests. After an investigation, the IEC set a hearing on the complaint and issued a prehearing order that listed potentially applicable standards of conduct or reporting requirements and reserved the right of the IEC to consider additional standards of conduct and reporting requirements based on the evidence presented and arguments made at the hearing. After the hearing, the IEC found that the use of the money in the discretionary account to travel to and attend the seminar and convention was primarily for partisan, and therefore personal, purposes and that it therefore (1) violated the ethical standard of conduct in section 24-9-105, C.R.S., that money in the account only be used for official business; and (2) was a breach of the public trust under section 24-18-103, C.R.S., which states that "the holding of public office or employment is a public trust" and requires a public officer or employee to "carry out his duties for the benefit of the people of the state."
Gessler sought judicial review, claiming that the IEC had exceeded its jurisdiction in considering the complaint, that its fact findings were arbitrary and capricious, and that it had violated his rights to due process, free speech, and assembly. The district court rejected the claims and affirmed the IEC's decision. Gessler then appealed, arguing that the IEC lacked jurisdiction over the complaint because section 5 of Amendment 41 should be construed to limit the IEC's jurisdiction to matters involving gifts, influence peddling, and standards of conduct and reporting requirements that expressly delegate enforcement to the IEC. The Court of Appeals affirmed the district court's decision, and the Colorado Supreme Court agreed to review that decision to determine whether: (1) the IEC had jurisdiction under the phrase "any other standards of conduct" in section 5 of article 41 to penalize any public employee for violating any Colorado law; (2) the phrase "other standards of conduct" is unconstitutionally vague; and (3) procedural due process requires pre-hearing notice to explain how laws are violated or may simply list laws and reserve the right to add charges after the hearing.
The Colorado Supreme Court first determined that "the overarching focus of [Amendment 41] is the regulation of activities that allowed covered individuals working in government, including elected officials, to gain improper personal financial benefit through their public employment." In light of this "overarching focus", the supreme court concluded that: (1) section 5 of Amendment 41, which authorizes the IEC to hear complaints under "any other standards of conduct...as provided by law," must be construed as granting the IEC jurisdiction over complaints of violations of "ethical standards of conduct that could allow covered individuals to improperly benefit financially from their public employment;" (2) "as provided by law" refers to laws already in existence; and (3) section 24-18-103, C.R.S, which establishes that the holding of office or employment is a public trust and that a public official shall carry out his duties for the benefit of the people of the state, establishes an ethical standard of conduct subject to the IEC's jurisdiction. Therefore, because the allegations against Gessler clearly implicated the public trust standard, the complaint fell within the IEC's jurisdiction, which is not limited to matters involving gifts, influence peddling, and standards of conduct and reporting requirements that expressly delegate enforcement to the IEC. Because the supreme court concluded that the IEC's jurisdiction over the case was proper and the allegations against the Secretary were within the scope of the IEC's jurisdiction, the court rejected Gessler's vagueness challenge. Finally, the supreme court rejected the Secretary's procedural due process claim because he failed to demonstrate that he suffered any prejudice as a result of the allegedly deficient notice. (For more information, contact Bob Lackner.)
Holding: The statute that limits the survivability of a claim for punitive damages or penalties applies only after the death of the person against whom the punitive damages or penalties are claimed.
Case Summary: The plaintiff, Casper, sued his insurance company for the unreasonable delay or denial of insurance benefits. The jury awarded him compensatory and punitive damages. Casper died before the court entered a written and signed order, which also included an award of Casper's attorney fees and costs in the judgment. The insurance company argued that the attorney fees and costs could not be included in the computation of punitive damages and that the punitive damages claim did not survive Casper's death. The trial judge disagreed; the insurance company appealed, and the court of appeals affirmed. The insurance company sought review in the supreme court.
Previous case law, Kruse v. McKenna, 178 P.3d 1198 (Colo. 2008), held that the determination of whether a claim is assignable depends upon whether it survives the death of the person originally entitled to assert the claim. Kruse therefore intimated that the survival statute's limitation on penalties and punitive damages applies when either party dies. But the Supreme Court in Casper held that Kruse effectively ignored the plain meaning of survival statute's text, which states that punitive damages and penalties are only not available after the death of the person "against whom such punitive damages or penalties are claimed". Because it was the insurance company against whom the punitive damages were claimed but it was Casper who died, the survival statute did not apply, and to the extent that the Kruse decision failed to give meaning to the plain language of the survival statute, that decision was overruled. (For more information, contact Thomas Morris.)
Maralex Res., Inc. v. Colo. Oil and Gas Conservation Comm’n, Colorado Court of Appeals No. 17CA0051 (March 22, 2018)
Holding: The court of appeals upheld the district court's determination that the Colorado oil and gas conservation commission's (COGCC) rule authorizing COGCC staff to inspect oil and gas properties without a warrant met the administrative search exemption to the constitutional warrant requirement.
Case Summary: The COGCC obtained and executed a warrant to search two oil and gas locations and, two weeks later, reinspected the locations without a warrant. The inspections revealed a number of violations of the COGCC's rules, and the COGCC issued an order finding violation against the oil and gas operator. The oil and gas operator and the surface property owner sought judicial review in district court, asserting a facial challenge to the constitutionality of the COGCC's rule authorizing warrantless searches as a violation of the constitutional protections against unreasonable searches and seizures. The district court concluded that the inspection rule did not violate either the United States or the Colorado Constitution.
The court of appeals analyzed whether the COGCC's inspection rule met the administrative search exception to the constitutional warrant requirement. Applying a three-part test, the court of appeals determined that the COGCC's regulatory scheme provided a "constitutionally adequate substitute for a warrant" based on findings that: (1) Oil and gas development is a closely regulated industry; (2) a requirement that the COGCC obtain a warrant for every inspection performed would frustrate the state's substantial interest in regulating oil and gas development; and (3) the COGCC enforced its inspection rule with sufficient certainty and regularity that members of the regulated community had a reduced expectation of privacy in the commercial premises inspected. The court of appeals concluded that the COGCC's inspection rule met the administrative search exemption to the constitutional warrant requirement.
The court of appeals also reviewed the surface property owner's separate constitutional challenge to the COGCC's inspection rule on grounds that the rule as applied to the surface property owner violated the constitutional warrant requirement and constituted a governmental taking. The court of appeals rejected the as-applied challenge to the warrantless search because the surface property owner did not have a reasonable expectation of privacy in the property where the surface property owner granted the operator an unlimited easement to the surface estate. The court declined to address the surface property owner's takings claim because it was raised in a perfunctory manner. (For more information, contact Jennifer Berman.)
Holding: Section 16-3-401 (2) does not create a private right of action against a governmental entity for a health care provider who treats a person in custody.
Case Summary: Arvada police arrested a severely injured man and transported him to Denver Health for treatment. After the man and his estate were unable to pay the costs of treatment, Denver Health sued Arvada to recover the costs. Denver Health argued that section 16-3-401, C.R.S., which requires law enforcement agencies to provide medical treatment to persons in custody if necessary, also requires such agencies to pay for such treatment. The Colorado supreme court held that section 16-3-401 does not create a private cause of action for a medical care provider. However, the court also held that any remedy for Denver Health's claim lies in contract law rather than tort law, and therefore the claim is not barred by the Colorado Governmental Immunity Act. Because Denver Health may yet prevail on a claim of unjust enrichment, the court remanded the case for further proceedings. In the majority opinion, Justice Hood stated that the issues in the case "cry out for resolution" by the General Assembly. (For more information, contact Jeremiah Barry.)
Holding: The court holds that section 18-13-128, C.R.S., is preempted by federal law under the doctrines of both field and conflict preemption and, accordingly, reverses the defendant's convictions.
Case Summary: In 2007, petitioner Fuentes-Espinoza was arrested in Wheat Ridge, Colorado, with a van full of people whom he was transporting from Arizona to Kansas. He was charged with, and later convicted of, seven counts of human smuggling in violation of section 18-13-128, C.R.S. He appealed his convictions, arguing that the statute is preempted by the federal "Immigration and Nationality Act", 8 U.S.C. sec. 1101-1537 (2017) (INA).
The court of appeals rejected Fuentes-Espinoza's preemption argument, concluding that he could not raise the argument on appeal because he did not assert it before the trial court. However, the Colorado Supreme Court chose to exercise its discretion to review the argument, and the supreme court agreed with Fuentes-Espinoza that section 18-13-128, C.R.S., is preempted by the INA. Accordingly, the court reversed his convictions on all counts.
The U.S. Supreme Court has recognized three forms of federal preemption: express, field, and conflict preemption. In Fuentes-Espinoza's case, the Colorado Supreme Court found that Colorado's human smuggling statute is preempted under the doctrines of both field and conflict preemption.
As to field preemption, the court found that the comprehensive nature of the INA demonstrates Congress's intent to "maintain a uniform, federally regulated framework for criminalizing and regulating the transportation, concealment, and inducement of unlawfully present aliens, and this framework is so pervasive that it has left no room for the states to supplement it."
As to conflict preemption, the court found that Colorado's human smuggling statute "stands as an obstacle to the accomplishment and execution of Congress's purposes and objectives in enacting the INA" because the statute (1) conflicts with the "careful calibration" of the INA's penalty scheme and (2) "sweeps more broadly" than the INA by criminalizing a wider range of conduct. "In doing so," said the court, "the Colorado statute disrupts Congress's objective of creating a uniform scheme of punishment because some human smuggling activities . . . are punishable in Colorado but not elsewhere." (For more information, contact Richard Sweetman.)
Holding: A court does not have the authority to collect unpaid fees and court costs after the completion of a deferred judgment and dismissal of the case.
Case Summary: This case involves the district court's authority to collect unpaid restitution and court costs and fees ordered as part of a deferred sentence after the completion of the deferred sentence. The prosecution moved to terminate defendant's deferred judgment while the defendant still owed restitution and court costs and fees. After the court granted the prosecution's motion to terminate defendant's deferred judgment, the court raised the issue, on its own, whether it still had the authority to collect restitution from the defendant. The court ruled that it did not. After that ruling, the defendant asked the court to consider whether the court had the authority to collect unpaid court-ordered fees and costs after completion of the deferred judgment and the court ruled it did not and vacated the court costs and fees. Shortly thereafter, the General Assembly passed HB14-1035, An Act Concerning Collection of Restitution Ordered Pursuant to a Deferred Judgment. The act amended the restitution statute to make it clear that restitution orders remain in effect after the termination of deferred judgment or deferred adjudication.
The Colorado Supreme Court ruled that a restitution order remains in effect after the termination of a deferred sentence. On the question of whether the district court could still collect the unpaid court costs and fees, the supreme court looked at each of the statutes that authorized the particular fee or court cost and found that none of the statutes contained similar language to the language in the restitution statute added by HB 14-1035 that makes it clear that the obligation to pay that fee or court cost continues after the completion of a deferred judgment and dismissal of the charges. So, the supreme court ruled that a district court does not have the authority to collect unpaid fees and court costs after the completion of a deferred judgment and dismissal of the case. (For more information, contact Michael Dohr.)
Holding: Court should hold a hearing to determine the amount of settlement proceeds to be offset against restitution order at which the defendant bears the burden of establishing the amount of any offset and the victim has the opportunity to rebut by proving how settlement proceeds were used.
Case Summary: The trial court ordered the defendant to pay $30,000 in restitution as a result of a traffic accident. The victim received $25,000, the full policy limits, from the defendant's auto insurer in settlement of all claims for personal injuries, loss of services, and property damage resulting from the accident.. The trial court offset the full $25,000 against the defendant's restitution order. The court of appeals found that the trial court should have held a hearing to allow the victim to rebut the inference of having received a double recovery by proving that she applied the settlement proceeds to costs that were not covered by the defendant's restitution. One judge found that the victim has all of the evidence and therefore a defendant may never be able to bear the burden of establishing that an amount paid in settlement of claims covers the same costs paid for by restitution and should therefore be offset. He suggested that the General Assembly should clarify what must be proven and by whom to trigger a trial court's discretion to order an offset. (For more information, contact Jeremiah Barry.)
Holding: A school district did not make a prohibited contribution in a school board election campaign under section 1-45-117 (1)(a) of the Fair Campaign Practices Act and the definition of "contribution" in article XXVIII, section 2(5)(a)(IV) of the state constitution.
Case Summary: In this case, the matter is of significant policy interest to members of the General Assembly and other major participants in the state's political process who regularly seek guidance in knowing whether and to what extent governmental bodies and their elected leaders may advocate for, and undertake action in support of, policy objectives without violating the provisions of section 1-45-117 (1)(a)(I) of the Fair Campaign Practices Act ("FCPA"). In relevant part, section 1-45-117 (1)(a)(I), C.R.S., prohibits the state and its political subdivisions from making contributions in election campaigns.
In February 2013, using public money, the Douglas County School District ("District") commissioned and paid for a "white paper" report that was prepared by a national public policy think tank supportive of the District's educational reform agenda. The report ultimately became known as the "Hess Report" after one of its two co-authors. In September of that year, the District emailed its weekly newsletter to approximately 85,000 residents of Douglas County. The newsletter provided a link through which readers could download and access the Hess Report. Shortly thereafter, Julie Keim, a candidate in the 2013 District school board elections, filed a campaign finance complaint against the District alleging that the Hess Report was a prohibited "indirect contribution" because it provided an indirect benefit to four school board candidates who were associated with a "reform slate." An administrative law judge ("ALJ") concluded that the District violated the FCPA by contracting for and disseminating the Hess Report. The District appealed and the Court of Appeals reversed in a divided opinion. Ms. Keim filed a petition for certiorari with the Supreme Court. The Supreme Court granted certiorari review and affirmed the Court of Appeals.
The Supreme Court initially held that under article XXVIII, section 2(5)(a)(IV) of the state constitution, a "contribution" requires that 1) something of value 2) be given to a candidate, directly or indirectly, (3) for the purpose of promoting the candidate's nomination, retention, recall, or election. Here, the District did not make a prohibited contribution to a campaign under article XXVIII, section 2(5)(a)(IV) of the state constitution and section 1-45-117(1)(a)(I), C.R.S., when it broadly disseminated an email of the report to county residents. The Court assumed that the Hess Report constituted a "thing of value" for purposes of the definition of "contribution." However, the District did not give the Hess Report, directly or indirectly, to any school board candidate, as required by the applicable definition of "contribution," when it distributed the email to county residents. The Supreme Court rejected the notion that something of value can be "given to" a candidate when it is publicly distributed, even if the candidate happens to be among the public to which the thing of value has become available. The definition of "contribution" cannot be construed so broadly to encompass anything of value that might "indirectly benefit" a candidate's nomination, retention, recall, or election. Accordingly, the ALJ erred in concluding that the District violated section 1-45-117(1)(a)(I), C.R.S., by contracting for and disseminating the Hess Report to Douglas County residents. (For more information, contact Bob Lackner.)
Holding: In light of the U.S. Supreme Court's holding in Davis v. Washington, 547, U.S. 813 (2006), the court rules that Colorado's confrontation clause applies only to testimonial statements.
Case Summary: Defendant's husband set fire to the couple's home while defendant was at work, killing the couple's three children and destroying the home. Defendant and her husband were charged and tried separately for multiple counts of murder, arson, and other crimes. While awaiting trial, the husband confessed to his cellmate that he and the defendant had acted together to burn down the house and kill their children to collect insurance proceeds. The defendant and her husband were convicted separately of multiple offenses, including the murders.
Defendant appealed her convictions, arguing that her husband's statements to his cellmate were inadmissible hearsay and the trial court's admission of the statements violated her right to confront her accusers. ("Hearsay" is an out-of-court statement that is offered to prove the truth of the matter asserted.) The court upheld the defendant's conviction, holding that the husband's statements were admissible.
In rejecting her arguments, the Colorado supreme court noted that in Davis v. Washington, 547 U.S. 813 (2006), the U.S. Supreme Court held that the Confrontation Clause of the Sixth Amendment to the U.S. Constitution, under which an accused has the right to confront his or her accuser, applies only to "testimonial" statements, or statements made in the course of formal testimony or interrogation, and not to "nontestimonial" statements. The Davis court relied upon the Court's own prior reasoning in Crawford v. Washington, 541 U.S. 36 (2004), where it declined to offer a precise definition of "testimony" but stated that it typically means "a solemn declaration or affirmation made for the purpose of establishing or proving some fact". (Crawford, at 51.)
Relying on Davis, the Colorado supreme court held that nontestimonial statements similarly do not implicate the confrontation clause (i.e., section 16 of article II) of the Colorado state constitution. Thus, the court overruled Compan v. People, 121 P.3d 876 (Colo. 2005), in which the court had held otherwise.
Because the husband's statements were undisputedly nontestimonial, the court next examined whether his statements fit under an existing exception to the general rule prohibiting the admission of hearsay. In determining that the husband's statements qualified as a statement against his own interest and were therefore admissible, the court revisited its standards for the admission of statements against interest that are offered to inculpate the accused. Specifically, the court reconsidered whether corroborating circumstances must exist that demonstrate the trustworthiness of the statement. The court concluded that, in light of its holding that nontestimonial statements do not implicate Colorado's confrontation clause, such corroborating circumstances are not required for the admission of nontestimonial statements against interest. Thus, the court overruled People v. Newton, 966 P.2d 563 (Colo. 1998), in which it had held otherwise. (For more information, contact Richard Sweetman.)
Holding: Hash-oil extraction is manufacturing, not processing, and is protected by Amendment 64 only for licensed individuals or entities.
Case Summary: Austin Lente was trying to extract hash oil from marijuana using butane. The butane exploded and burned down his laundry room. Mr. Lente was charged with illegally processing or manufacturing marijuana. Mr. Lente argued that Amendment 64 amended the constitution to make processing marijuana legal, and he argued that extracting hash oil is a form of processing. The district court agreed and dismissed the charge. The state appealed to the Supreme Court, which held that Mr. Lente was engaged in manufacturing, not processing, which is legal under Amendment 64 only if the manufacturer holds a license. Mr. Lente did not hold a license. To give effect to the voters' intent in adopting Amendment 64, the Court looked to the definitions of "processing" and "manufacturing" that were in place when Amendment 64 passed. Because Amendment 64 did not separately define manufacturing and processing, the voters are presumed to have adopted the accepted meanings existing at the time. There was no definition for processing, but there was one for manufacturing, which the Court found included extracting hash oil. The Court reversed the district court's holding and remanded the case to the district court for further proceedings. (For more information, contact Jeremiah Barry.)
Holding: In this case involving construction defect claims raised by the Vallagio at Inverness Residential Condominium Association, against Metropolitan Homes, Inc., the Colorado Supreme Court affirmed the Colorado Court of Appeals' decision that provisions of a common interest community's declaration that require all construction defect claims to be submitted to binding arbitration and specify that the binding arbitration provision may only be amended with the declarant's consent do not violate the Colorado Common Interest Ownership Act (CCIOA) or the Colorado Consumer Protection Act (CCPA).
Case Summary: A provision of a common interest community's original declaration required all construction defect claims to go through binding arbitration. Another provision prohibited the unit owners of the common interest community from amending the provision establishing the binding arbitration requirement without the declarant's consent. After a construction defect dispute arose, at least 67% of the unit owners, in accordance with section 38-33.3-217, C.R.S., which establishes a 67% voting threshold for amending a declaration, voted to amend the declaration to remove the binding arbitration requirement. Thereafter, the unit owner's association, the Vallagio at Inverness Residential Condominium Association (association) filed a civil complaint against Metropolitan Homes, Inc. (declarant) in district court asserting the construction defect claims. The declarant moved to compel arbitration, arguing that the amendment removing the binding arbitration requirement was invalid because the unit owners had not obtained the declarant's consent to the amendment. The association argued that the declarant consent requirement violated the CCIOA and that the binding arbitration requirement violated the CCPA. The district court denied the declarant's motion to compel arbitration, and the declarant filed an interlocutory appeal. The Colorado Court of Appeals reversed the district court's determination, concluding that the amendment consent and binding arbitration provisions did not violate either the CCIOA or the CCPA and were therefore valid and enforceable. The Colorado Supreme Court granted the association's petition for certiorari and affirmed the court of appeals' decision.
The supreme court held that the provision of the declaration requiring the declarant's consent to any amendment to the binding arbitration provision of the declaration did not violate the CCIOA's provision requiring a 67% vote of unit owners to amend the declaration. The court rejected the association's argument that the CCIOA provision set forth the exclusive procedure for amending a declaration and concluded that the statutory language in the CCIOA was clear and unambiguous in establishing a percentage threshold only; it did not prohibit additional requirements that did not affect the percentage of unit owners required to affirmatively vote for or agree to an amendment of the declaration. The court further held that the amendment consent requirement did not violate the CCIOA's prohibition against restricting an association's dealings with the declarant more stringently than its dealings with a third party because the amendment consent requirement affected a power held by the unit owners and not the association. Finally, the court held that the CCPA's right to a civil action, i.e. a court proceeding, is waivable because the general assembly did not elect to make the rights afforded by the CCPA non-waivable and that CCPA claims therefore may be adjudicated through binding arbitration. Having held that the binding arbitration provision and provision requiring the consent of the declarant to amend that provision requirements of the declaration were valid, the supreme court remanded the case so that the construction defect claims could proceed through binding arbitration.
Two justices dissented, concluding that the legislative intent of section 38-33.3.-217, C.R.S., is to require no more than 67% of unit owners' votes to amend a declaration and that the declarant consent requirement of the declaration at issue contravened this legislative intent by "effectively allowing the Declarant to grant itself permanent veto power over a supermajority of unit owners and thus unilaterally control the Association's ability to amend the declaration." (For more information, contact Jennifer Berman.)
Martinez v. Colo. Oil and Gas Conservation Comm'n, Colorado Court of Appeals No. 16CA0564 (March 23, 2017)
Holding: The Colorado oil and gas conservation commission erred when it denied a petition to adopt a rule on the basis that it lacked statutory authority to adopt the proposed rule to prohibit issuance of a well permit if the permit would adversely impact public health or impair the environment, including wildlife. The plain meaning of the statute authorizes the commission to foster the development of oil and gas resources in a manner consistent with the protection of public health, safety, and welfare, including the protection of the environment and wildlife resources.
Case Summary: Plaintiffs petitioned for a rule that would require the commission to deny a well permit unless the drilling can occur in a manner that does not cumulatively impair Colorado's atmosphere, water, wildlife, and land resources, does not adversely impact human health, and does not contribute to climate change. The commission denied the petition, determining that the commission lacked statutory authority to adopt the proposed rule. The district court upheld the commission's determination, finding that the statute requires the commission to balance developing oil and gas resources with protecting public health, safety, and welfare.
The court of appeals reversed based on its analysis of the oil and gas statute's legislative declaration, which states that it is in the public interest to foster the "responsible, balanced development, production, and utilization of the natural resources of oil and gas in the state of Colorado in a manner consistent with protection of public health, safety, and welfare, including protection of the environment and wildlife resources." The court construed the word "balanced" as applying only to the phrase "development, production, and utilization" and concluded that the development of oil and gas resources is in the public interest only when it occurs in a manner consistent with the protection of public health, safety, and welfare, including the protection of the environment and wildlife resources. The court held that "in a manner consistent with" does not indicate a balancing test but rather a condition that must be fulfilled. The court construed a substantive portion of the statute in a similar manner, finding that the commission's authority to regulate "[o]il and gas operations so as to prevent and mitigate significant adverse environmental impacts . . . to the extent necessary to protect public health, safety, and welfare . . . taking into consideration cost-effectiveness and technical feasibility" supports the conclusion that the general assembly intended to elevate the importance of public health, safety, and welfare above a mere balancing test. (For more information, contact Thomas Morris.)
Broomfield Senior Living Owner, LLC v. R.G. Brinkmann Co., Colorado Court of Appeals No. 16CA0101 (March 9, 2017).
Holding: Broomfield Senior Living Owner, LLC, although it is an entity and not an individual, is a "residential property owner" and therefore is entitled to the benefit of the "Homeowner Protection Act", which voids certain contractual provisions limiting claims for construction defects.
Case Summary: Broomfield Senior Living Owner, LLC, acquired rights under a contract for the construction of a senior living community with multiple residential units, which Broomfield would rent out to individual tenants. Brinkmann Constructors was the builder. The project was completed in 2009. In late 2012, Broomfield became aware of the likelihood of plumbing problems, i.e., broken pipes under a concrete floor, and notified Brinkmann of the defect. Brinkmann disputed liability and Broomfield sued.
The contract contained time limits and notice requirements for any claims against Brinkmann. The time limits were shorter than the statutory limitation periods that would otherwise apply if Broomfield were a "residential property owner"; therefore, those time limits would be void under the "Homeowner Protection Act of 2007". This raised the question of whether Broomfield, as a commercial enterprise, was a "residential property owner" within the intended meaning of the "Homeowner Protection Act". The trial court held that it was not and granted summary judgment to Brinkmann based on the shorter contractual limitation periods.
The Colorado Court of Appeals reversed, concluding that Broomfield did meet the definition of a "residential property owner" entitled to the protection of the "Homeowner Protection Act". While there is no definition of "residential property owner" or of "residential property", the court of appeals found that the common usage of the term was unambiguous and a companion statute defines "commercial property" as property zoned for "commercial, industrial, or office" use, none of which were permitted uses of the property in question. Therefore, the property was "residential property" and Broomfield, as its owner, was a "residential property owner". (For more information, contact Darren Thornberry.)
Holding: If an investor gives reasonably equivalent value for the receipt in good faith of profits from an investment in a Ponzi scheme, the transfer of the profits to the investor is not voidable.
Case Summary: Steve Taylor (defendant) invested money in a Ponzi scheme. Before the scheme was shut down and without knowing that it was an illegal arrangement, he received substantial profits and withdrew all of his principal. After the Ponzi scheme was discovered and shut down, the trial court appointed a receiver. The receiver sued the defendant in Denver District Court under the "Colorado Uniform Fraudulent Transfer Act" (CUFTA) to void the transfers of the profits to him so that those profits could be used to provide restitution to later investors in the Ponzi scheme who lost some or all of the principal amounts of their investments. The defendant argued that the receiver's claim was not timely and that even if it were timely the transfers of profits were not voidable because he received the profits in good faith and gave reasonably equivalent value for them.
The district court granted summary judgment to the receiver, holding that the claim was timely and that the transfers of profits to the defendant were voidable. The Court of Appeals reversed the trial court, holding that the receiver's claim was not timely. The Supreme Court reversed the Court of Appeals, holding that the receiver's claim was timely, and remanded the case to the Court of Appeals to determine whether the transfers of profits to the defendant were voidable.
The Court of Appeals, in what it said was a case of first impression in Colorado, held that if an investor gives reasonably equivalent value for the receipt in good faith of profits from an investment in a Ponzi scheme, transfers of the profits to the investor are not voidable. The court declined to follow federal case law that construed other states' versions of the "Uniform Fraudulent Transfer Act" so that "reasonably equivalent value" can never be given for profits from a Ponzi scheme. Those cases reasoned that upholding transfers of profits depletes the assets of the scheme operator, thus depriving subsequent investors of the return of their principal. But the Court of Appeals noted that upholding transfers of principal has the exact same effect of depleting the assets and reducing other parties' restitution and further reasoned that the time-value of money could constitute reasonably equivalent value. Finding the relevant provision of CUFTA, section 38-8-109 (1), C.R.S., which states that "[a] transfer or other obligation is not voidable . . . against a person who took in good faith and for a reasonably equivalent value . . .", to be clear, it remanded the case to the district court to make particularized findings of fact as to whether reasonably equivalent value was given for each individual transfer of profits. The Court of Appeals also suggested hat the General Assembly may wish to enact a new statute if it finds that the current statute does not provide sufficiently equitable remedies for victims of Ponzi schemes. (For more information, contact Thomas Morris.)
Holding: Section 14(2)(e) of article XVIII of the state constition that requires law enforcement to return marijuana after an acquittal based on a medical marijuana defense is unconstitutional.
Case Summary: The defendant was charged with cultivating and possessing marijuana with the intent to distribute. The police seized drug paraphernalia, 55 marijuana plants, and approximately 2.9 kilograms of marijuana from the defendant's home. The defendant asserted the defense that he was a medical marijuana patient authorized to cultivate and possess marijuana. The jury acquitted the defendant. The defendant requested the police return the seized marijuana paraphernalia and marijuana plants pursuant to section 14(2)(e) of article XVIII of the state constitution. That section requires "marijuana and paraphernalia seized by state or local law enforcement officials from a patient . . . in connection with the claimed medical use of marijuana shall be returned immediately upon . . . the dismissal of charges, or acquittal". The people opposed the motion arguing that it conflicts with and is preempted by the Federal Controlled Substances Act. The Supreme Court agreed with the people that the return provision of the constitution requires police officers to violate federal law by distributing marijuana when they return the marijuana to the acquitted person. The Supreme Court declared there was a positive conflict between state and federal law and therefore the state law was preempted by the Federal Controlled Substances Act. (For more information, contact Michael Dohr.)
Holding: The term "notice" in section 18-5-702, C.R.S., is not limited to notice in person or in writing.
Case Summary: On December 21 and 22, 2009, the defendant purchased over $8000 worth of electronics equipment from an electronics store using a debit card issued to him. The card was declined during the transaction, but the defendant used a false override authorization code to force the sale. Defendant's bank had cancelled the card on December 9, 2009, after the defendant called the bank to report that he never received the card. A bank representative testified that the bank employee would have told the defendant during the phone call that the card was cancelled. Defendant was charged with unauthorized use of a financial instrument and theft.
Under section 18-5-702 (1), C.R.S., a person commits unauthorized use of a financial instrument if he or she uses a financial device, such as a debit card, after he or she has notice that the "device has expired, has been revoked, or has been cancelled". Section 18-5-702 (2), C.R.S., states that notice "includes either notice given in person or notice give in writing to the account holder". The question before the court was whether notice under section 18-5-702, C.R.S., is limited to just notice in person or in writing. The prosecution relied on the phone call to satisfy the notice element. The Court of Appeals suggested that the statute was ambiguous or unclear. The defendant argued that the term "includes" makes the definition of notice exclusive to just in-person or in-writing notice. The court disagreed. The court found that the notice element is not limited to in-person or in-writing notice because the word "includes" is a word of extension and illustration not limitation. The Court of Appeals upheld the conviction, finding that notice by means of a phone call was sufficient to satisfy that element of the crime since the statute did not limit notice to being in writing or in person. (For more information, contact Michael Dohr.)
City of Northglenn v. Bd. of County Comm'rs, Colorado Court of Appeals No. 15CA1743 (December 15, 2016)
Holding: Adams County does not have either constitutional or stautory authority to impose a special sales tax on retail marijuana. Accordingly, the Adams County special sales tax on retail marijuana is invalid. In addition, the Cities had standing to sue Adams County becuase the county marijuana sales tax levied by Adams County would likely harm the fiscal interests of the Cities by reducing their tax revenue.
Case Summary: In 2012, Colorado voters approved Amendment 64 to the Colorado Constitution, which authorizes personal use and regulation of marijuana. In 2013, the General Assembly proposed, and Colorado voters approved, a 10% state special sales tax on all sales of retail marijuana and retail marijuana products (state marijuana sales tax). The state marijuana sales tax is levied in addition to the general state sales tax, which also applies to such sales. Section 39-28.8-203, C.R.S., requires the state to apportion a portion of state marijuana sales tax revenue to local governments and section 39-28.8-203 (1)(a)(VI), C.R.S., clarifies that the distribution mechanism "shall [not] be construed to prevent a local government from imposing, levying, and collecting any fee or any tax upon the sale of retail marijuana or retail marijuana products." Accordingly, in addition to the state special sales tax, the Adams County cities of Northglenn, Aurora, and Commerce City (the Cities), which as home rule cities all have "the full right of self-government in both local and municipal matters," levy special sales taxes on all sales of retail marijuana and retail marijuana products occurring within the cities (city marijuana sales taxes).
Article 2 of title 29, C.R.S., explicitly authorizes a county to impose a general countywide sales tax, as well as special sales taxes for specified purposes, but does not explicitly authorize a county to impose a special sales tax on retail marijuana or retail marijuana products (county marijuana sales tax). Nonetheless, in 2014, the board of county commissioners of Adams County proposed, and the registered electors of Adams County approved, a county marijuana sales tax.
In May 2015, the Cities sued Adams County in Adams County District Court, claiming that Adams County had no legal authority to impose or collect the county marijuana sales tax and that imposition of the unauthorized tax would reduce their marijuana-related tax revenue by placing retail marijuana businesses in the cities at a competitive disadvantage to retail marijuana businesses in other jurisdictions where there is no county marijuana sales tax. The Cities argued that the state and cities are expressly authorized to respectively levy state and city marijuana sales taxes but that even though the General Assembly has expressly authorized counties to levy certain other special sales taxes, it has not authorized counties to levy a county marijuana sales tax. Adams County argued that section 39-28.8-203 (1)(a)(VI), C.R.S., authorizes the county to levy a county marijuana sales tax by clarifying that section 39-28.8-203 does not prevent a local government from imposing, levying, and collecting a tax on the sale of retail marijuana. Adams County also argued that the Cities lacked standing to sue.
The District Court held that the Cities had standing to sue because the county marijuana sales tax levied by Adams County likely would likely harm the fiscal interests of the cities by reducing their tax revenue. The District Court also concluded that the plain language of section 39-28.8-203 (1)(a)(VI), C.R.S., when read in conjunction with both the statutory definition of "local government", which includes counties, and the statutory provision authorizing the state to levy the state marijuana sales tax, authorizes counties to levy a county marijuana sales tax.
The Cities appealed, and the Colorado Court of Appeals, after briefly confirming that the Cities had standing to sue on the same grounds relied upon by the District Court, reversed the District Court on the merits, concluding that Adams County does not have constitutional or statutory authority to impose a county marijuana sales tax.
The Court of Appeals, noting that "in Colorado a grant of taxation authority . . . must be explicit" and that "counties only have those powers expressly conferred by the state," first determined that a county may impose a special sales tax like a county marijuana sales tax only if there is express constitutional or statutory authority to do so. The Court then held that neither the general county sales tax authority in section 29-2-103, C.R.S., nor the state retail marijuana sales tax authority in section 39-28.8-203, C.R.S., confers express authority for a county to levy a county marijuana sales tax, specifically stating that the general county taxing authority authorizes only a general county sales tax and that the absence of an explicit prohibition against counties imposing a county marijuana sales tax in section 39-28.8-203, C.R.S., does not itself authorize a county to impose such a tax. Finally, the Court rejected Adams County's argument that the election approving the county retail marijuana sales tax deprived the court of authority to invalidate the tax, finding the validity of the election irrelevant to whether Adams County had the underlying legislative power to impose the tax. Accordingly, the Court held that Adams County’s county marijuana sales tax is invalid and reversed the judgment of the District Court. (For more information, contact Nicole Myers.)
Grand Valley Water Users Ass’n v. Busk-Ivanhoe, Inc., Colorado Supreme Court No. 14SA303 (December 5, 2016)
Holding: In construing a water rights decree, the water court erred in finding an implied right to store transmountain water before its original direct-flow use in the importing basin. Just because transmountain water can be reused to extinction after it has been put to its original use does not mean that it can be stored before its original direct-flow use.
Case Summary: A 1928 water rights decree authorized the collection and storage of water in the Colorado river basin and the delivery of the water through a tunnel into the Arkansas river basin for direct-flow irrigation use. The decree did not authorize any storage of the water other than in the Colorado river basin. Historically, the original owners of the water right stored the water in the Arkansas river basin before it was used for irrigation.
The City of Aurora eventually acquired the water rights and filed an application with the water judge to change the type of use from irrigation to municipal and the place of use to Aurora. The water judge, after considering extrinsic evidence that was not considered in the adjudication of the 1928 decree, construed the decree to include an implied right to store the water in the Arkansas river basin. It therefore included the use of the stored water when calculating the amount of historic consumptive use to determine how much water Aurora would be allowed to use in Aurora.
The supreme court reversed the water judge's judgment, holding that it was error to consider the extrinsic evidence when construing the 1928 decree and that just because transmountain water can be reused to extinction after it has been put to its original use does not mean that it can be stored before its original direct-flow use. Therefore, the 1928 decree does not impliedly authorize the storage of the water in the Arkansas river basin, the storage was unlawful, and the use of that water could not be considered in calculating the amount of historic consumptive use. (For more information, contact Thomas Morris.)
Holding: Section 43-1-208, C.R.S., grants condemnation authority to the transportation commission, not the department of transportation, and the commission may not delegate that authority to the department. Unlike other circumstances in which statutes grant the department of transportation authority to determine whether to acquire property by condemnation, the decision to approve the acquisition of property for the kinds of highway alterations enumerated in section 43-1-208, C.R.S., and whether to limit the amount for which that property may be acquired, is a decision vested solely in the transportation commission.
Case Summary: The department of transportation (department) filed a petition in condemnation in Jefferson County District Court to acquire property owned by Amerco Real Estate Company and occupied by U-Haul, citing sections 43-1-208, 43-1-209, and 43-1-210, C.R.S,. as legal authority for its exercise of condemnation power. In the petition, the department asserted that it needed the property for a highway expansion project (project) at the U.S. Highway 36 and Wadsworth Boulevard interchange. Shortly thereafter the department filed a motion for immediate possession of the property.
U-Haul filed a brief in opposition to the department's motion for immediate possession and also requested that the district court dismiss the entire petition in condemnation on the ground that the department lacked legal authority to condemn the property. Specifically, U-Haul argued that the department and the transportation commission (commission) had failed to comply with section 43-1-208 (1) and (2), C.R.S., condemnation prerequisites that: (1) the chief engineer of the department (chief engineer) provide a written report to the commission describing both the project and the specific properties to be condemned and estimating the damages and benefits that would accrue to each affected landowner; and (2) the commission, after receiving the report, make a public determination that both the project itself and the acquisition of the particular properties required for its completion would serve the public interest or convenience (condemnation prerequisites). U-Haul also disputed the legal sufficiency of documents that the department relied on as authority for its condemnation power, specifically a 1994 commission resolution directing the executive director of the department to handle the approval of land acquisition on behalf of the commission and a "Land Acquisition Approval" document signed by the chief engineer that listed properties to be acquired for the project and that also referenced a 2009 commission resolution approving the project.
The district court declined to dismiss the petition in condemnation and granted the department's motion for immediate possession. The district court concluded that: (1) the commission's enabling statutes authorized it to acquire property by either conducting condemnation proceedings itself using the procedures specified in section 43-1-208, C.R.S., or using the general condemnation procedures specified in title 38, C.R.S. (general condemnation procedures); and (2) the 1994 resolution did not improperly delegate the commission's power of condemnation under section 43-1-208, C.R.S., to the chief engineer, but instead simply directed the chief engineer to exercise the commission's power to acquire property using general condemnation procedures.
U-Haul appealed directly to the Colorado Supreme Court. The supreme court reversed the district court, holding that although other statutes grant condemnation authority to the department in other circumstances, section 43-1-208, C.R.S., which specifically applies to the acquisition of property needed for projects that "establish, open, relocate, widen, add mass transit to, or otherwise alter a portion of a state highway," does not and that "the decision to approve the acquisition of property for the kinds of highway alterations enumerated in section [43-1-]208, [C.R.S.] in the first instance, and whether to limit the amount for which that property may be acquired, is a decision vested solely in the commission." The supreme court also concluded that the commission could not skip the condemnation prerequisites and simply acquire property using general condemnation procedures, but must instead first satisfy the condemnation prerequisites and then decide whether to acquire the needed property using the procedure specified in section 43-1-208, C.R.S., or general condemnation procedures.
Justice Gabriel, joined by two other justices, filed an opinion concurring in the judgment. Justice Gabriel agreed with the majority of the supreme court that that the commission lacked authority to delegate its section 43-1-208, C.R.S., condemnation authority to the department but disagreed with the majority's conclusion that the commission could not skip the condemnation prerequisites and itself acquire property by simply using general condemnation procedures. (For more information, contact Jason Gelender.)
Holding: When a public employee defendant files a motion to dismiss a lawsuit based on immunity under the Colorado Governmental Immunity Act (CGIA) and alleges that his or her allegedly tortious conduct was not willful and wanton, he or she is claiming sovereign immunity, which is the only kind of immunity that can be claimed under the CGIA. Consequently, under section 24-10-118 (2)(a) and (2)(a.5), C.R.S., the trial court must determine all issues, including factual issues relating to the immunity claim, before trial and the court's decision regarding the motion is a final decision that is subject to interlocutory appeal. In deciding whether a public employee's conduct is willful and wanton, a court errs in applying a negligence standard and must instead determine whether the conduct exhibits "a conscious disregard of the danger."
Case Summary: Alamosa Police Department officer Jeffrey Martinez (Martinez) and fellow officers responded to a call that Steven Wayne Bleck (Bleck) was suicidal and possibly armed. When Bleck did not respond to the officers' command to show his hands and lie down on the floor, Martinez, without holstering his previously drawn firearm, attempted to subdue him. In the process, Martinez's firearm accidentally discharged and injured Bleck.
Bleck filed a civil lawsuit for battery against Martinez in Alamosa County District Court. Martinez filed a motion to dismiss for lack of subject matter jurisdiction, alleging that because his conduct in attempting to subdue Bleck was not willful and wanton, he was entitled to CGIA immunity under section 24-10-118 (2)(a), C.R.S., which states that "a public employee shall be immune from liability in any claim for injury . . . which lies in tort or could lie in tort . . . and which arises out of an act or omission of such employee . . . unless the act or omission causing such injury was willful and wanton." The district court denied the motion to dismiss, applying a negligence standard and finding that Bleck had adequately pled willful and wanton conduct by alleging that Martinez should have known that attempting to subdue Bleck without first holstering his firearm was dangerous.
Pursuant to section 24-10-118 (2)(a.5), C.R.S., which states that a district court's decision regarding a public employee's motion that raises the defense of sovereign immunity is "a final judgment" that is "subject to interlocutory appeal," Martinez filed an interlocutory appeal of the district court's denial of his motion to dismiss with the Colorado Court of Appeals. The court of appeals concluded that it lacked jurisdiction to hear the appeal because Martinez was only entitled to claim qualified immunity, which is not appealable on an interlocutory basis, not sovereign immunity, which is appealable.
Martinez appealed to the Colorado Supreme Court. The supreme court reversed the court of appeals and remanded the case back to the district court for a determination as to whether Martinez's conduct was willful and wanton. Noting that the CGIA refers only to sovereign immunity and not to qualified immunity, the supreme court "disavow[ed]" language in previously decided supreme court cases that had distinguished between qualified immunity and sovereign immunity and held that sovereign immunity is the only type of immunity that a public employee defendant may raise under the CGIA. Consequently, the question of whether a public employee's conduct is willful and wanton under section 24-10-118 (2)(a), C.R.S., the very question raised by Martinez in his motion to dismiss, implicates the public employee's sovereign immunity and, under section 24-10-118 (2.5), C.R.S., is a final decision that is subject to interlocutory review. The supreme court also held that because "trial courts must resolve all issues pertaining to sovereign immunity prior to trial, including factual issues," the district court had erred by failing to determine whether Martinez's conduct was willful and wanton. Finally, the supreme court held that the district court had incorrectly applied a negligence standard for willful and wanton conduct when it determined that Bleck's claim was sufficiently pled. The supreme court instructed the district court, when deciding on remand whether Martinez's conduct was willful and wanton, to determine whether Martinez's conduct had "exhibited a conscious disregard of the danger." (For more information, contact Jason Gelender.)
Holding: The parks and wildlife commission's discretion is unfettered when neither the statutes nor the rules provide it with any guidance regarding the appropriate period for which wildlife license privileges should be suspended for the unregistered provision of outfitting services, so the commission's suspension of the privileges for twenty years is vacated as being arbitrary and capricious.
Case Summary: A hunting outfitter allowed his Colorado outfitter registration to lapse but continued to be qualified as an outfitter in Utah. While providing outfitter services in Utah, he and his client followed a mountain lion into Colorado, where the client shot and killed the lion.
Providing unregistered outfitting services is deemed to be the illegal sale of wildlife, a class 5 felony. The outfitter pleaded guilty; the deferred judgment prohibited him from engaging in any hunting activities for two years. The conviction triggered a hearing before the parks and wildlife commission. The statute specifies that the administrative penalty for the illegal sale of wildlife is the suspension of any or all wildlife license privileges for a period of between one year and lifetime. Neither the statutes nor the commission's rules set any standards to guide the commission's determination of an appropriate suspension period.
A hearing officer suspended the outfitter's wildlife license privileges for 20 years, and the commission affirmed the suspension. The outfitter appealed the commission's order to the district court, which affirmed the commission's action.
The court of appeals reversed and vacated the commission's suspension of the outfitter's wildlife license privileges. Because the commission's discretion is unfettered when neither the statutes nor the rules provide it with any guidance regarding the appropriate period for which wildlife license privileges should be suspended, the commission's action was arbitrary and capricious. The court did not express an opinion regarding whether the commission could, after adopting appropriate rules to guide the hearing officer's discretion, institute new suspension proceedings against the outfitter. (For more information, contact Thomas Morris.)
Holding: HB13-1272, which eliminated special districts' sales tax exemptions without prior voter approval, is constitutional because it neither imposes a "new tax" nor constitutes a "tax policy change" within the meaning of TABOR.
Case Summary: The Regional Transportation District ("RTD") and the Scientific and Cultural Facilities District ("SCFD") have general authority under their enabling statutes to levy sales taxes on any transactions upon which the state levies sales tax. On several occasions following the enactment of the RTD and SCFD enabling statutes, the General Assembly enacted legislation that created new state sales tax exemptions or subjected previously exempt transactions to the state sales tax but did not similarly modify the RTD and SCFD sales tax bases. In 2013, the General Assembly enacted House Bill 13-1272, (HB 13-1272) which eliminated some of the districts' exemptions and created other new exemptions for them in order to again make the districts' and the state's sales tax bases identical.
The TABOR Foundation filed a lawsuit in Denver District Court against RTD, SCFD and others alleging that HB 13-1272 created new RTD and SCFD taxes on the items that were previously exempted and that the new taxes are unconstitutional because the districts did not receive prior voter approval for them as required by the Taxpayers' Bill of Rights (TABOR). The district court granted summary judgment in favor of the defendants, concluding that taxation of the items previously exempted did not create new taxes because the initial grant to the districts of taxing authority coterminous of that of the state was not expanded even though the state modified it over time. The district court also held that taxation of the previously exempted items is an administrative simplification and not a "tax policy change" requiring prior voter approval under TABOR.
The TABOR Foundation appealed the district court's grant of summary judgment to defendants, and the Colorado Court of Appeals affirmed. Before addressing the merits of the case, the court noted that the "beyond a reasonable doubt" standard of unconstitutionality applies to TABOR-based challenges to a statute and that under Colorado Supreme Court precedent a court must not strike down a statute "unless a 'clear and unmistakable' conflict exists between the statute and a provision of the Colorado Constitution." The court of appeals then clarified that "to hold a statute unconstitutional beyond a reasonable doubt, the constitutional flaw must be so clear that the court can act without reservation." Although the court of appeals determined that the district court had misapplied the "beyond a reasonable doubt" standard by requiring "evidence that 'the legislature drafted a law using language designed to circumvent the requirements of TABOR, i.e., a tax policy change disguised as administrative simplification," after conducting its own de novo review it agreed with the district court that HB 13-1272 is not unconstitutional beyond a reasonable doubt.
First, the court of appeals held that HB 13-1272 did not violate TABOR's voter approval requirement because it does not impose a new tax, noting that the primary purpose of the bill was not to raise revenue and that requiring an election to remove exemptions under TABOR would hamper the General Assembly's ability to administer taxation efficiently. Recognizing that the new tax question "is close", the court of appeals alternatively held that even if HB 13-1272 did impose a new tax, the voters approval of past sales tax ballot questions—in 1973 for RTD and in 1994 for SCFD—authorized the districts to collect taxes on the items for which HB 13-1272 removed exemptions.
The court of appeals found the second TABOR challenge—whether prior voter approval was required by TABOR because eliminating sales tax exemptions is a "tax policy change directly causing a net tax revenue gain" to the districts—to not be a close question. The court focused on the plain meaning of the word "policy" in this TABOR phrase and defined it as a "high level overall plan". It then concluded that with respect to the sales tax, the districts' high level overall plans are to tax a broad range of tangible items, and that eliminating exemptions did not change the high level overall plans. Accordingly, the court held that the removal of exemptions by HB 13-1272 did not constitute a tax policy change. (For more information, contact Ed DeCecco.)
Holding: When considering a motion to dismiss a civil complaint for failure to state a claim upon which relief can be granted under Colorado Rule of Civil Procedure 12 (b) (5), a court must determine, in accordance with the United States Supreme Court's decisions in Bell Atlantic Corp. v. Twombley, 550 U.S, 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009), whether the complaint contains sufficient factual matter, accepted as true, to state a claim for relief that is plausible on its face. The "plausible on its face" standard supersedes the longstanding state standard for dismissal, based on the United States Supreme Court's decision in Conley v. Gibson, 355 U.S. 41 (1957), that allowed a court to dismiss a complaint only if it appeared beyond doubt that the plaintiff could prove no set of facts that would establish his or her claim for relief. It is necessary to use the "plausible on its face" standard instead of the "no set of facts" standard to ensure procedural uniformity between state and federal courts in deciding motions to dismiss under CRCP 12 (b) (5) and the nearly identical Federal Rule of Civil Procedure 12 (b) (6) and to increase the effectiveness of state courts in weeding out groundless complaints at the pleading stage.
Case Summary: Plaintiff Bill Hall (Hall) had a purchase agreement to sell land in the town of Gilcrest (Gilcrest) to Ensign United States Drilling, Inc., (Ensign), which intended to build its headquarters on the property. But Ensign terminated the purchase agreement when it could not obtain Gilcrest's approval for its proposed site development plan. Hall sued both Gilcrest and its mayor, Menda Warne (Warne), in state district court under several state and federal law theories, including intentional interference with contractual obligations,
Hall's complaint alleged that Warne caused Ensign to terminate its purchase agreement with Hall by imposing unauthorized and unreasonable conditions on Ensign's proposed site development plan by mayoral order after the Gilcrest town board had conditionally approved the plan at a public hearing. Warne filed a motion to dismiss the complaint for failure to state a claim upon which relief can be granted under Colorado Rule of Civil Procedure (CRCP) 12 (b) (5) (motion to dismiss). The district court found that Hall's complaint did not sufficiently allege that Warne had caused the conditions to be imposed on Ensign's proposed development plan and granted the motion to dismiss but also granted Hall leave to file an amended complaint. Hall amended his complaint with additional allegations, and Warne renewed her motion to dismiss. The district court granted the renewed motion and awarded attorney fees to Warne, concluding that the amended complaint lacked necessary allegations that specific conduct by Warne caused Ensign's breach of its purchase agreement with Hall.
Hall appealed and the Colorado Court of Appeals reversed, declaring itself bound by Colorado Supreme Court precedent to apply the "no set of facts" standard established by the United States Supreme Court in Conley v. Gibson, 355 U.S. 41 (1957), for consideration of a motion to dismiss under CRCP 12 (b) (5), which allows a court to grant a motion to dismiss only if it appears beyond doubt that the plaintiff can prove no set of facts that would establish his or her claim for relief. The court of appeals rejected Warne's proposal to instead apply the newer "plausible on its face standard" established by the United States Supreme Court in Bell Atlantic Corp. v. Twombley, 550 U.S, 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009), which requires a court to grant a motion to dismiss unless the complaint contains sufficient factual matter to state a claim for relief that is plausible on its face. The court of appeals concluded that Hall's allegations concerning Warne's actions were sufficiently plead to state a claim for relief under the "no set of facts" standard.
Hall appealed, and the Colorado Supreme Court reversed. The Supreme Court explained that its main reason for applying the "no set of facts" standard for the last fifty years had been to ensure that state courts decided CRCP 12 (b) (5) motions to dismiss consistently with how the federal courts decided motions to dismiss under the similar Federal Rule of Civil Procedure 12 (b) (6). Accordingly, since the United States Supreme Court had abandoned the Conley "no set of facts" standard in favor of the Twombley/Iqbal "plausible on its face" standard, the Supreme Court chose to continue favoring procedural uniformity between state and federal courts by adopting the "plausible on its face" standard and requiring state courts to apply that standard when considering motions to dismiss. The Supreme Court further noted that application of the "plausible on its face" standard might increase the effectiveness of state courts in weeding out groundless complaints at the pleading stage.
Applying the newly adopted "plausible on its face" standard to Hall's complaint, the Supreme Court found that the complaint failed to sufficiently allege that Warne acted improperly in inducing Ensign's breach of its purchase agreement with Hall. The Court dismissed the complaint but remanded the case with instructions to allow Hall to file another amended complaint because he had not previously had notice that he was required to state his claims in a manner sufficient to meet the "plausible on its face" standard.
Justice Gabriel, joined by two other justices, filed a dissenting opinion stating that he could not subscribe to the "plausible on its face" standard because it "will deny access to justice for innumerable plaintiffs with legitimate complaints." He noted that the "no set of facts" standard had recognized "the practical limitations on how much a plaintiff can reasonably be required to plead, particularly given that the plaintiff often lacks information that is in the defendant's exclusive possession and has no means of obtaining that information absent discovery." He also argued that the "plausible on its face" standard is inconsistent with and contrary to the purposes of several state rules of civil procedure that "require only fair notice of a claim" and "will likely result in the disproportionate dismissal of meritorious claims, thereby closing the courthouse doors to many deserving claimants when the pleading rules were, in fact, designed to open the doors for them." (For more information, contact Jason Gelender.)
Holding: In a 6-1 decision, the Colorado Supreme Court held that section 1-1-113 (1), C.R.S., does not permit a court to consider a pre-election challenge to an election official's certification to the ballot of a candidate on the sole ground that the candidate does not meet the qualifications for the office if the statutory period specified in section 1-4-501 (3), C.R.S., for directly challenging the qualification of the candidate has expired.
Case Summary: One week before the regular biennial school board election for Mesa County Valley School District 51, three registered electors of the school district filed a verified petition with the district court, challenging as wrongful the certification to the ballot of one of the candidates. The petition indicated that it was filed pursuant to section 1-1-113 (1), C.R.S., which does not impose any specific duty or function upon any election official but instead provides a general procedural vehicle or method for the adjudication of controversies arising from a breach or neglect of duty or other wrongful act that occurs before the day of an election. The petitioners sought a judicial determination and declaration: (1) that Paul Pitton, a certified candidate for school board director of District B, was unqualified to be a candidate for that office; (2) that the designated election official committed a wrongful act in failing to verify Pitton's residence before certifying him to the ballot; and (3) that the clerk and recorder must not record or tabulate ballots marked for Pitton. The petition named as respondents the Mesa County clerk and recorder and the district board of education's designated election official.
The district court denied the relief requested in the petition, finding that section 1-1-113 (1), C.R.S., did not authorize adjudication of Pitton's eligibility as a candidate at that stage in the election cycle. Instead, it ordered that the election be allowed to proceed. Petitioners immediately filed an application for review by the Colorado Supreme Court pursuant to section 1-1-113 (3), C.R.S.
Affirming the order of the district court, the Colorado Supreme Court held that section 1-4-501 (3), C.R.S., which specifically requires a challenge to the qualification of any candidate by an eligible elector to be made within five days after the certification of the candidate and establishes a specific and abbreviated timeframe within which a district court must determine whether the candidate is or is not qualified for office, conflicts with section 1-1-113, C.R.S., The Court, while noting that section 2-4-205, C.R.S., expresses the General Assembly's preference for resolving a conflict between two statutes by construing the statutes, whenever possible, to give effect to both, concluded that any construction that would either treat the five-day period of section 1-4-501 (3), C.R.S., as anything other than a limitation on the time permitted for filing a challenge to a candidate's qualifications or permit a pre-election challenge to a candidate's qualifications indirectly through section 1-1-113, C.R.S., after the five-day period specified in section 1-4-501 (3), C.R.S., had passed would effectively render the five-day provision superfluous. Accordingly, the Court concluded that it could not reasonably give effect to both section 1-4-501 (3), C.R.S. and section 1-1-113, C.R.S., and that, because section 2-4-205, C.R.S., specifies that when two statutes irreconcilably conflict the specific provision prevails as an exception to the general provision unless that general provision is later enacted and clearly intended to prevail over the specific provision, section 1-4-501 (3), C.R.S., as a specific provision enacted later in time, overrides the more general and earlier enacted section 1-1-113, C.R.S.
In its holding, the Supreme Court also noted that the General Assembly expressly contemplated the situation in which an ineligible candidate could be elected, and that it addressed that scenario (without allowing for disruption of the election process once underway) by providing for a post-election challenge to a winning candidate's qualifications, resulting, if successful, in a vacancy in office rather than a declaration that the next-highest vote getter was legally elected. (For more information, contact Kate Meyer.)
Holding: A municipal 5-year moratorium on fracking within city limits is preempted by state law (Oil & Gas Conservation Act).
Case Summary: In November of 2013, the citizens of Fort Collins, a home-rule city, voted in favor of a citizen-initiated ordinance placing a moratorium on hydraulic fracturing ("fracking") and the storage of any associated waste products within the City or on lands under its jurisdiction for a period of 5 years (that is, until 2018) in order to fully study the impacts of fracking on property values and human health. After voters approved the moratorium, the City amended its municipal code accordingly.
Thereafter, the Colorado Oil and Gas Association (COGA) sued the City and requested: (1) a declaratory judgment declaring that the Oil and Gas Conservation Act, §§ 34-60-101 to -130, C.R.S., and the rules promulgated pursuant thereto preempt the fracking moratorium; and (2) a permanent injunction enjoining the enforcement of the moratorium. COGA and the City filed cross-motions for summary judgment on the declaratory judgment claim, and the district court ruled that the moratorium was preempted by state law. On appeal by the City, the Court of Appeals requested transfer of the case to the Colorado Supreme Court under C.A.R. 50.
The Colorado Supreme Court determined that fracking is a matter of mixed state and local concern, and therefore applied a preemption analysis. Finding neither express nor implied preemption under the oil and gas statute, the Court examined the requirements of the state and municipal legislation, respectively, and found that the City's 5-year moratorium on fracking and the storage of fracking waste operationally conflicts with the effectuation of state law. Accordingly, the moratorium was declared preempted by state law, therefore invalid and unenforceable. (For more information, contact Duane Gall.)
Holding: The Colorado Supreme Court affirmed the district court's order enjoining the City of Longmont from enforcing its ban on fracking because the ban is preempted by state law and, therefore, is invalid.
Case Summary: In 2012, the residents of Longmont voted to ban hydraulic fracturing, commonly known as fracking, and the storage and disposal of fracking waste within their city limits. The Colorado Oil and Gas Association (Association) sued Longmont, seeking a declaratory judgment to invalidate, and a permanent injunction to enjoin, the fracking ban. Granting the Association's motion for summary judgment, the district court ruled that the Oil and Gas Conservation Act (Act) preempted the fracking ban and issued an order enjoining Longmont from enforcing the ban. The district court stayed its order, pending appeal. Longmont appealed the district court's order to the Colorado Court of Appeals, which requested a transfer of the case to the Colorado Supreme Court. The Colorado Supreme Court accepted the transfer and affirmed the district court's permanent injunction order.
The Colorado Supreme Court first determined that Longmont's status as a home-rule municipality would not insulate its fracking ban from preemption if the ban conflicts with state law because fracking is a matter of mixed state and local concern and a home-rule municipality's ordinance supersedes a conflicting state law only with respect to a matter that is strictly of local concern. The court then determined that the fracking ban materially impedes the effectuation of the state's interest in the efficient and responsible development of oil and gas, an interest that the state has furthered by promulgating numerous rules regulating various aspects of fracking, from the chemicals used in the process to the location of disposal sites. A local ordinance that materially impedes the state's interest regarding a matter of mixed state and local concern operationally conflicts with state law and, therefore, is preempted by state law. Accordingly, the court concluded that state law preempts Longmont's fracking ban because the ban conflicts with the Act and rules promulgated under the Act.
The Colorado Supreme Court also rejected an argument, asserted by several environmental groups who had been added to the case as citizen intervenor plainitffs, that preemption of the fracking ban would violate article II, section 3 of the Colorado Constitution, which declares certain rights of individuals to be "natural, essential, and inalienable," because the fracking ban protects those rights. In doing so, the court noted both that no existing legal authority supported application of article II, section 3 to its preemption analysis and that acceptance of the citizen intervenor plaintiffs' reasoning would always preclude preemption of any "local regulation alleged to concern life, liberty, property, safety, or happiness" and would arguably render the municipal home rule provision of the Colorado Constitution unnecessary in violation of the principle that courts avoid interpretations that "render a constitutional provision superfluous or a nullity." (For more information, contact Jennifer Berman.)
Holding: By a 4-3 decision, the Colorado Supreme Court held that a decision by the Independent Ethics Commission to dismiss a complaint as frivolous is not subject to the judicial review provisions found in section 24-18.5-101 (9), C.R.S.
Case Summary: Colorado Ethics Watch (Ethics Watch) filed an ethics complaint with the Independent Ethics Commission (IEC) against a county commissioner. The IEC, in accordance with provisions of article XXIX of the Colorado constitution (Amendment 41) that allow it to "dismiss frivolous complaints without conducting a hearing" and require it to keep any frivolous complaint that it dismisses confidential, conducted a preliminary investigation, met in executive session to discuss the complaint, and dismissed the complaint as frivolous. Ethics Watch then sued the IEC, requesting that the trial court declare the IEC's frivolity determination unlawful and order the IEC to proceed with a full investigation and public hearing. After the trial court denied the IEC's responsive motion to dismiss for lack of subject matter jurisdiction, the Colorado Supreme Court, at the request of the IEC, agreed to exercise original jurisdiction over the case to determine whether or not a court has subject matter jurisdiction to review an IEC determination that an ethics complaint is frivolous.
In a 4-3 decision, the Colorado Supreme Court held that an IEC determination that an ethics complaint is frivolous is not subject to judicial review. Interpreting and applying provisions of Amendment 41 that authorize the General Assembly to enact legislation concerning the manner of recovery of penalties imposed by the IEC and the imposition of additional penalties but prohibit the General Assembly from enacting legislation that "limit[s] or restrict[s]" the powers of the IEC, the Court concluded that Amendment 41 prohibits the General Assembly from enacting legislation pertaining to IEC decisions that do not involve the enforcement of penalties. Accordingly, while the General Assembly may authorize judicial review of an enforcement decision by the IEC, it may not authorize judicial review of a decision of the IEC to dismiss an ethics complaint because such a dismissal does not involve the enforcement of penalties but instead represents the IEC's decision not to enforce. In order to interpret section 24-18.5-101 (9), C.R.S., which provides for judicial review of any final IEC action concerning a complaint, in a manner that "preserves its constitutionality", the Court held that section 24-18.5-101 (9), C.R.S., authorizes only judicial review of an IEC enforcement decisions and does not apply to a decision by the IEC to dismiss a complaint as frivolous. (For more information, contact Bob Lackner.)
Holding: The plain language of section 39-29-102 (3) (a), C.R.S., authorizes a severance tax deduction for any transportation, manufacturing, and processing costs, and the cost of capital is a deductible cost that resulted from the investment in transportation and processing facilities.
Case Summary: Colorado levies a tax on the gross income generated from oil and gas severed from the earth in the state, section 39-29-105, C.R.S. The tax is levied at the point at which oil and gas emerges from the earth's surface, but the oil and gas is usually not sold at this point. Accordingly, section 39-29-102 (3) (a), C.R.S., allows a taxpayer to deduct from revenue "any transportation, manufacturing, and processing costs borne by the taxpayer," which effectively subtracts any post-extraction value added by the taxpayer.
In the 1980s, BP's predecessor in interest constructed facilities to process and transport natural gas that it extracted from coal seams in southwest Colorado. In 2005, BP filed amended severance tax returns for tax years 2003 and 2004, seeking to deduct the cost of capital related to these facilities from the revenue generated by natural gas sales. Cost of capital is the amount of money that BP's predecessor could have earned if it had invested in other ventures rather than in building the facilities.
The Department of Revenue denied the deduction, and BP contested the determination in district court, which ruled in BP's favor. The department appealed and the Colorado Court of Appeals reversed the trial court's decision and held that the cost of capital was not a deductible transportation and processing cost. BP appealed this decision, and the Colorado Supreme Court reversed the lower court's decision.
In doing so, the court concluded that the phrase "any transportation, manufacturing, and processing costs" was unambiguous. "Costs" means the "price or expenditure" and by using the phrase "any . . . costs" the legislature did not distinguish between different types of costs. Therefore, all transportation, manufacturing, and processing costs are deductible. This conclusion was bolstered by a comparison with a similar property tax statute in which the General Assembly omitted the term "any" and instead conferred discretion to the property tax administrator to determine the scope of allowable deductions.
Having determined the scope of allowable deductions, the court then rejected the department's argument that the cost of capital is only a benefit foregone to pursue a different opportunity and not an actual cost. Rather, the court determined that it is a cost that is equal to the difference between the amount of cost recovery that the predecessors actually received from constructing the facilities and the amount of recovery or deductions that the predecessors could have received if they had invested in other ventures. Accordingly, BP was entitled to recover the stipulated refunds plus interest.
After this decision the department advised the General Assembly that other taxpayers were owed refunds for amended severance returns that included cost of capital deductions. In addition, the department anticipated that it would have to refund additional amounts based on the court's interpretation of the phrase "any transportation, manufacturing, and processing costs." In order to ensure that there was sufficient revenue available for all of the potential refunds and to allow continuity of programs that are funded from severance taxes, the General Assembly enacted Senate Bill 16-218, which temporarily made income tax revenue available for severance tax refunds. (For more information, contact Ed DeCecco.)
Amerigas Propane and Indem. Ins. Co. of N. Am. v. Indus. Claim Appeals Office, Colorado Court of Appeals No. 15CA1210 (April 21, 2016)
Holding: Allowing a workers' compensation claimant to waive benefits for all consequences of an injury, whether known or unknown, as part of a settlement agreement is not contrary to public policy.
Case Summary: Claimant was a truck driver who slipped and fell on ice while making a delivery. His shoulder was seriously injured and eventually required replacement with an artificial joint. The claimant settled with his employer before reaching maximum medical improvement. At the time of the settlement, unbeknownst to the claimant, his attorney, the employer, or anyone else, the claimant had sustained a bone fracture during the surgery to correct the initial injury. The settlement agreement provided that all claims for injuries, including unknown injuries, would be "FOREVER closed" and "FOREVER settled." (Emphasis in original.) After discovering the latent bone fracture, the claimant moved to reopen the settlement under § 8-43-204, C.R.S., which allows reopening only on grounds of fraud or "mutual mistake of material fact."
The Court of Appeals held that, under these circumstances, the general waiver of benefits for injuries both known and unknown at the time of the settlement precluded reopening of the settlement on the basis of mutual mistake. The court distinguished a prior opinion of the Colorado Supreme Court allowing reopening under similar circumstances because here, unlike in the prior case, the fracture was not part of the "basic character of the primary injury" but occurred later, during treatment of the primary injury. Therefore the claimant "was fully aware 'of the basic character of the primary injury for which the release was sought and executed.'"
The Court of Appeals also opined that neither case law nor prior amendments to the statute had specified "whether the parties to an agreement could limit what factors would qualify as a mutual mistake of material fact," and that the "strong legislative policy" allowing reopening in cases of mutual mistake did not overcome the parties' expressed intent to foreclose all future claims in this case.
This outcome raises the question of whether the language of § 8-43-204 (1), C.R.S., allowing reopening of a settlement in a workers' compensation case on the basis of mutual mistake, requires clarification. (For more information, contact Duane Gall.)
Holding: Trial court erred in dismissing plaintiff's claims relating to the constitutionality of a 2013 law concerning ammunition magazines. The case is remanded to allow this claim to proceed.
Case Summary: In 2013, the Colorado General Assembly enacted several bills addressing the possession and transfer of firearms. Shortly after the bills were signed into law, plaintiffs filed a complaint in Denver district court challenging the constitutionality of two of the bills. Specifically, plaintiffs alleged that (1) HB13-1224 and HB13-1229 unconstitutionally restrict the right to bear arms, (2) HB13-1229 is an unconstitutional delegation of legislative and executive authority, and (3) HB13-1229 violates the due process and equal protection provisions of the state constitution. The district court concluded that the plaintiffs failed to state a claim for which relief could be granted. It dismissed the plaintiffs' claims, and the plaintiffs brought this appeal.
The court of appeals affirmed those portions of the district court's decision dismissing the claims relating to HB13-1229. However, the court of appeals found that the district court erred in dismissing the plaintiffs' claims with regard to the constitutionality of HB13-1224. The district court had relied in part on the facts and reasonsing set forth in Colo. Outfitters Ass'n v. Hickenlooper, 24 F. Supp. 3d 1050 (D. Colo. 2014), to dismiss these claims. However, as the court of appeals stated, the allegations in the plaintiffs' complaint "deserve testing through the crucible of factfinding," and plaintiffs are entitled to present evidence at trial of the basis for their claim. The case was remanded to the district court with instructions to allow the claim to proceed. (For more information, contact Richard Sweetman.)
Direct Mktg. Ass'n v. Brohl, U.S. Court of Appeals for the Tenth Circuit No. 12-1175 (February 22, 2016)
Holding: The notice and reporting obligations that Colorado imposes on retailers that do not collect Colorado sales tax are neither facially discriminatory nor discriminatory in their effects and do not burden interstate commerce. Thus, the notice and reporting obligations do not violate the dormant commerce clause of the United States Constitution.
Case Summary: Colorado has imposed a sales tax since 1935 and a use tax since 1937. The taxes are complementary. The sales tax is paid at the point of sale and the use tax is due from the purchaser when property is stored, used, or consumed in Colorado and when sales tax was not paid to a retailer. Retailers with physical presence in the state are required to collect sales tax. Because of the dormant commerce clause of the United States Constitution, Colorado cannot compel retailers that sell products to customers in the state but the do not have physical presence in the state to collect Colorado sales tax. As noted by the 10th Circuit Court of Appeals, "compliance with the sales tax is extremely high, and compliance with the use tax is extremely low."
To assist the state in collecting use tax from in-state purchasers, the Colorado legislature passed a law in 2010 (2010 law) that requires any retailer that does not collect Colorado sales tax: (1) To send a "transactional notice" to purchasers informing them that they may be subject to the state's use tax; (2) To send Colorado purchasers who buy goods from the retailers totaling more than $500 an "annual purchase summary" with the dates, categories, and amounts of purchases, reminding them of their obligation to pay use taxes on those purchases, and (3) To send the Department of Revenue (Department) an annual "customer information report" listing their customers' names, addresses, and total amounts spent.
The Direct Marketing Association (DMA), a group of businesses and organizations that market products via catalogs, advertisements, broadcast media, and the internet, challenged the 2010 law in the United States District Court for the District of Colorado (district court), alleging that it violates the dormant commerce clause of the United States Constitution by discriminating against and unduly burdening interstate commerce.
The district court granted summary judgment to DMA on both grounds, permanently enjoining the Department from enforcing the 2010 law. On appeal, the 10th Circuit Court of Appeals declined to address the merits of DMA's claims and instead held that the district court lacked jurisdiction to hear DMA's challenge under the Tax Injunction Act. DMA then sued the Department in state court. At the same time, DMA also petitioned for certiorari to the United States Supreme Court, seeking review of the dismissal under the Tax Injunction Act. The United States Supreme Court granted DMA's petition for certiorari, and the state court stayed its proceedings. The United States Supreme Court held that the Tax Injunction Act did not strip the federal courts of jurisdiction, reversing the 10th Circuit Court of Appeals, and remanded the case back to the 10th Circuit Court of Appeals for a determination on the merits as to the DMA's claims that the 2010 law discriminates against and unduly burdens interstate commerce in violation of the dormant commerce clause in the United States Constitution.
Article I, Section 8, Clause 3 of the United States Constitution specifies that "Congress shall have [the] power . . . [t]o regulate commerce . . . among the several States." This is known as the commerce clause. The United States Supreme Court has interpreted the commerce clause to limit state regulation of interstate commerce by reading the clause as both an express grant of power to Congress and an implicit limit on the power of state and local governments. This implicit limit is called the dormant commerce clause. State laws that discriminate either do so on their face or in their effects. A state law that discriminates against interstate commerce will survive constitutional challenge only if the state shows that "it advances a legitimate local purpose that cannot be adequately served by reasonable nondiscriminatory alternatives." Even if the law regulates even-handedly, the law may also be invalidated if the burden imposed on interstate commerce is excessive in relation to the benefits.
The outcome of the case turns largely on the interpretation of the scope of a United States Supreme Court case, Quill Corp. v. North Dakota, 504 U.S. 298 (1992), which established that a state may not require an out-of-state retailer without a physical presence in the state to collect sales tax. The 10th Circuit Court of Appeals held that Quill applied only to sales and use tax collection and not to the imposition of notice and reporting obligations. This decision means that Quill does not establish that an out-of-state retailer is free from all regulatory requirements.
The 10th Circuit Court of Appeals held that the 2010 law does not discriminate, either on its face or in its practical effects, against interstate commerce. First, the court held that on its face the 2010 law does not distinguish between out-of-state retailers and in-state retailers, and instead makes a distinction based on whether a retailer collects sales tax or not. The court noted that "some out-of-state retailers are collecting retailers, some are not" and explained that because there is no language in the 2010 law explicitly identifying geographical distinctions, there is no facial discrimination.
The 10th Circuit Court of Appeals held that the 2010 law does not discriminate in its practical effects for 3 reasons: (1) While there is differential treatment, here the 2010 law does not negatively affect out-of-state interests and the 2010 law does not give in-state retailers a competitive advantage; (2) The differential treatment does not amount to discrimination because the in-state retailers and out-of-state non-collecting retailers are not similarly situated; and (3) When looking at the entire regulatory scheme, the 2010 law is designed to increase compliance with preexisting tax obligations and applies only to retailers that are not otherwise required to comply "with the greater burden of tax collection and reporting."
Finally, the 10th Circuit Court of Appeals held that the 2010 law does not unduly burden interstate commerce. DMA relied solely on Quill for its undue burden claim and the district court limited its undue burden analysis to Quill. Because the court held that Quill applies only to sales and use tax collection and not to the imposition of notice and reporting requirements, Quill does not control the undue burden analysis and cannot be extended to the 2010 law, which, therefore, does not impose an undue burden on interstate commerce.
The 10th Circuit Court of Appeals reversed the district court's order granting summary judgment to DMA and remanded the case to the district court for further proceedings consistent with its opinion. (For more information, contact Esther van Mourik.)
Holding: The "negative factor" used to reduce a school district's total program funding does not violate article IX, section 17(1) of the Colorado constitution (Amendment 23) because the negative factor does not reduce the statewide base per pupil funding below the minimum funding required by the constitution. The plaintiffs have failed to state a claim for relief. The case is remanded to the trial court to dismiss the complaint.
Case Summary: The Colorado Supreme Court remanded the case to the trial court for an order granting the State's motion to dismiss the complaint. The plaintiff, Dwyer, argued that the "negative factor" applied to a school district's total program funding pursuant to section 22-54-104, C.R.S., is unconstitutional because it violates Amendment 23, which requires annual increases to "statewide base per pupil funding."
Colorado apportions education funding to individual school districts pursuant to the Public School Finance Act of 1994 (the Act) set forth in sections 22-54-101 to 22-54-137, C.R.S. Pursuant to the Act, a school district's "per pupil funding" is comprised of two main components; "statewide base per pupil funding" and "factor" funding. The statewide base per pupil funding is the same for all school districts. The amount of a school district's factor funding varies based upon the characteristics of the school district. Once a school district's per pupil funding is determined, that amount is multiplied by the school district's pupil count, with additional funding added for certain pupils, resulting in the school district's "total program funding."
The voters of Colorado passed Amendment 23 in 2000 through the initiative process. The relevant portion of Amendment 23 requires the general assembly to annually increase statewide base per pupil funding by at least the rate of inflation. In 2010, to stabilize the state budget, the general assembly established the "negative factor" to implement a uniform percentage reduction to each school district's total program funding as calculated under the Act. Each year, the general assembly increases the "statewide base per pupil funding" by inflation as required by Amendment 23, and then reduces each school district's total program funding by the percentage reduction amount for that budget year, which is calculated to meet the statutory cap established for education funding. But a school district's total program funding cannot fall below the required statewide base per pupil funding amount, as adjusted by Amendment 23.
Dwyer argued that, because factor funding is based on the statewide base per pupil funding amount, the intent of Amendment 23 was actually to increase total per pupil funding through the application of the funding formula. Although the general assembly may have annually increased the statewide base per pupil funding amount, when it applied the negative factor, the general assembly reduced total program funding, thereby reducing the anticipated effect of the increase to the base and violating Amendment 23.
The Supreme Court held that the plain language of Amendment 23 requires annual increases to statewide base per pupil funding and not to total program funding. Because the language is clear and unambiguous, the Court does not need to look beyond the language of the amendment to ascertain the voters' intent. Because the application of the negative factor has not reduced statewide base per pupil funding below the constitutional minimum, it does not violate Amendment 23. Therefore, the plaintiffs failed to state a claim for relief and the complaint should be dismissed. (For more information, contact Brita Darling.)
Holding: The court of appeals affirmed the district court's ruling and rejected the City's request for attorney fees under C.R.C.P. 12(b). The court of appeals stated that, "although section 24-10-106(1)(d)(I), C.R.S., is not ambiguous as to whether it waives immunity for parking areas of a street within the limits of a municipality, it is a poorly written statute…[w]hile it is possible to diagram the grammatical composition of this section to demonstrate the lack of ambiguity, the complexity of such a diagram reinforces our hope that the legislature will rewrite it."
Case Summary: The plaintiffs, Linda and William McKinley, filed a claim against the defendant, the City of Glenwood Springs (City), seeking to hold the City liable for Linda McKinley's injuries and William McKinley's loss of consortium after Linda McKinley pulled her car into a parking spot on a municipal street in Glenwood Springs, stepped out of her car, and tripped in a four- to five-inch deep depression in the pavement of the parking lot. The City moved to dismiss the McKinley's complaint, claiming that it was immune from suit under section 24-10-106 (1), C.R.S., of the Colorado Immunity Act (CGIA), which protects public entities from suits for tort-based injuries unless the section explicitly waives immunity. In response to the City's motion, the district court conducted an evidentiary hearing and found that section 24-10-106 (1) (d) (I), C.R.S., waives immunity for injuries occurring in parking areas in municipalities. They also found that the depression was dangerous and interfered with traffic. The City appealed the district court's denial of its motion to the Colorado court of appeals.
On appeal, the City argued that the grammatical structure of the statute "separates the types of government roads by disjunctive." The City further argued that such separation makes the final phrase "on that portion of such highway, road, street, or sidewalk which was designed and intended for…parking thereon" only applicable to "highways" that are part of the "state highway system." The court of appeals disagreed, and held that the "parking thereon" phrase applies to each division of thoroughfare: highway, road, street, or sidewalk. As a result, the "parking thereon" phrase must apply to municipal highways, roads, streets, or sidewalks.
The City also argued that it was immune from suit under the CGIA because neither Linda McKinley's fall nor the depression "physically interfere[d] with the movement of traffic." However, the evidence established that the depression was a dangerous condition that physically interfered with traffic because cars pull into the City's parking spaces from the City's street, the depression was four- to five-inches deep, and the surface of the City's parking spaces are normally smooth. Therefore, the court of appeals disagreed with the City's argument.
The court of appeals affirmed the district court's ruling and rejected the City's request for attorney fees under C.R.C.P. 12(b). The court of appeals further stated that, "although section 24-10-106(1)(d)(I), C.R.S., is not ambiguous as to whether it waives immunity for parking areas of a street within the limits of a municipality, it is a poorly written statute…[w]hile it is possible to diagram the grammatical composition of this section to demonstrate the lack of ambiguity, the complexity of such a diagram reinforces our hope that the legislature will rewrite it." (For more information, contact Vanessa Cleaver.)
Holding: The act of same-sex marriage is closely correlated to petitioners' sexual orientation and thus the respondents' refusal to create a wedding cake for their same-sex wedding because of respondent's religious beliefs violated the Colorado Anti-Discrimination Act (CADA). The act of designing and selling a wedding cake to all customers free of discrimination does not force respondent to engage in compelled expressive conduct in violation of the freedom of speech protections of the First Amendment to the United States constitution (First Amendment) or the Colorado constitution. CADA is a neutral law of general applicability and does not violate the free exercise of religion guaranteed by the first amendment to the United States constitution and article II, section 4 of the Colorado constitution.
Case Summary: Charlie Craig and David Mullins (petitioners), requested that Masterpiece Cakeshop, Inc., and its owner Jack Phillips (respondents), design and create a cake for their same-sex wedding. Phillips declined, telling petitioners that he does not create wedding cakes for same-sex weddings because of his religious beliefs. Petitioners filed charges of discrimination with the Colorado Civil Rights Division (Division), alleging discrimination based on sexual orientation in violation of CADA. The Division investigated and found probable cause to credit the allegations of discrimination. Petitioners then filed a formal complaint with the Office of Administrative Courts. The administrative law judge (ALJ) filed a lengthy written order finding in favor of petitioners and against respondents on cross-motions for summary judgment. The order was affirmed by the Colorado Civil Rights Commission (Commission). The Commission's final cease and desist order required respondents to: (1) take remedial measures, including staff training and an alteration to the company's policies to ensure compliance with CADA; and (2) file quarterly compliance reports for two years with the Division that describe the remedial measures taken to comply with CADA and document all patrons who were denied service and the reason for the denial.
Respondents appealed the Commission's order to the Colorado Court of Appeals, alleging, in addition to several procedural motions, that: (1) the ALJ erred in concluding that respondents' refusal to create a wedding cake for petitioners was "because of" their sexual orientation; (2) the Commission's order compels speech in violation of the First Amendment and article II, section 10 of the Colorado constitution; and (3) the Commission's order unconstitutionally infringes on the respondents' free exercise of religion rights, protected by the First Amendment and article II, section 4 of the Colorado constitution. The Court of Appeals affirmed the Commission's decision.
To prevail on a discrimination claim under CADA, petitioners must prove that, "but for" their membership in a protected class, here sexual orientation, they would not have been denied the full privileges of a place of business engaged in sales to and offering services to the public. Respondents argued that the decision to not create a wedding cake for petitioners was solely because of petitioners' intended conduct, same-sex marriage, and the celebratory message about same-sex marriage that the baking of the cake would convey, not "because of" the petitioners' sexual orientation. The Court of Appeals concluded that the act of same-sex marriage is closely correlated with sexual orientation and that, "[b]ut for their sexual orientation, [petitioners] would not have sought to enter into a same-sex marriage, and but for their intent to do so, [respondents] would not have denied them [their] services." The Court of Appeals held that the ALJ did not err by concluding that respondents refused to create a wedding cake for petitioners "because of" their sexual orientation, in violation of CADA.
Respondents argued that the Commission's order compels speech in violation of the First Amendment and article II, section 10 of the Colorado constitution by requiring respondents to create wedding cakes for same-sex weddings. Respondents argued that wedding cakes inherently convey a celebratory message about marriage and, therefore, the Commission's order unconstitutionally compelled the respondents to convey a celebratory message about same-sex marriage that is in conflict with respondents' beliefs. The Court of Appeals stated, "the act of designing and selling a wedding cake to all customers free of discrimination does not convey a celebratory message about same-sex weddings likely to be understood by those who view it, . . . that message is more likely to be attributed to the customer than to [respondents]." Furthermore, the Court of Appeals found that "CADA does not prevent [respondents] from posting a disclaimer in the store or on the Internet indicating that the provision of its services does not constitute an endorsement or approval of conduct protected by CADA." Deciding not to distinguish between the First Amendment and article II, section 10 of the Colorado constitution as applied to respondents' freedom of speech claim, the Court of Appeals held that even if the speech is compelled by the government, it is not sufficiently expressive to warrant First Amendment protection. Because the Court of Appeals held that the compelled conduct was not sufficiently expressive, the Commission did not need to show that it has an important interest in enforcing CADA.
Respondents also argued that the Commission's order unconstitutionally infringed on its right to the free exercise of religion guaranteed by the First Amendment and article II, section 4 of the Colorado constitution. Because the law is unclear as to whether a corporation enjoys free exercise of religion rights under both the United States constitution and the Colorado constitution, the Court of Appeals assumed, without deciding, that Masterpiece has free exercise rights under both the First Amendment and the Colorado constitution. If a law is either not neutral or not generally applicable it must be justified by a compelling governmental interest and must be narrowly tailored to advance that interest. The threshold question thus was whether the Court of Appeals found CADA to be a neutral law of general applicability. Respondents argued that CADA is not generally applicable because the law includes exemptions for places principally used for religious purposes such as churches, synagogues, and mosques. The Court of Appeals stated that a law need not apply to every individual and entity to be generally applicable, noting that the exemptions reflect an attempt by the General Assembly to reduce legal burdens on religious organizations and comport with the free exercise doctrine. The Court of Appeals stated that "CADA does not compel [respondents] to support or endorse any particular religious views. The law merely prohibits [respondents] from discriminating against potential customers on account of their sexual orientation. . . . [Respondents remain] free to continue espousing [their] religious beliefs, including [their] opposition to same-sex marriage. However, if [respondents wish] to operate as a public accommodation and conduct business within the State of Colorado, CADA prohibits [them] from picking and choosing customers based on their sexual orientation." Thus, the Court of Appeals held that CADA is a neutral law of general applicability. The Court of Appeals held "we easily conclude that [CADA] is rationally related to Colorado's interest in eliminating discrimination in places of public accommodation. . . . Therefore, CADA's proscription of sexual orientation discrimination by places of public accommodation is a reasonable regulation that does not offend the free exercise clauses of the First Amendment and article II, section 4."
Respondents further argued that although neutral laws of general applicability do not violate the First Amendment, the free exercise clause of the Colorado constitution required that the Court of Appeals review CADA under heightened strict scrutiny. The Court of Appeals held that because the Colorado Supreme Court has recognized that article II, section 4 of the Colorado constitution embodies "the same values of free exercise and governmental non-involvement secured by the religious clauses of the First Amendment," and because Colorado appellate courts have regularly relied on federal precedent in interpreting article II, section 4, there is no support for the argument that the Colorado constitution requires the application of a heightened scrutiny test. (For more information, contact Esther van Mourik.)
Holding: A majority of the Court holds that the "Public School Finance Act of 1994" (the Act), section 22-54-101, C.R.S., et. seq., neither explicitly permits, nor does the language of the Act imply, a private right of action to enforce the Act. Thus, the plaintiffs/respondents (Taxpayers) lack standing under the Act to bring a claim that the CSP violates the Act. Taxpayers cannot challenge the Act under the doctrine of taxpayer standing, alleging that the government violated a statute. A plurality of the Court holds 4-3 that Douglas County School District's Choice Scholarship Program (CSP) violates the plain language of article IX, section 7 of the Colorado constitution because the scholarship program aids religious schools.
Case Summary: The CSP is a scholarship program created by the Douglas County School Board to distribute tuition scholarships to students who attend private schools. The scholarship amount equals 75% of the per pupil state funds received by the Douglas County School District (District) through the Act. For the 2011-12 school year, the amount of the scholarship was $4,575. The District pays the scholarship to a student's parents through a check endorsed to the participating private school that the student attends. To participate in the CSP, a private school must satisfy certain requirements and allow the District to administer various assessments. The private school need not, however, modify its admission criteria, and the CSP explicitly authorizes participating private schools to make enrollment decisions based on religious belief. The majority of the participating private schools are religious, and, for the 2011-12 school year, 93% of scholarship recipients were enrolled in religious schools. In theory, the CSP operates as a tuition offset, although the CSP does not prohibit participating private schools from raising tuition after having been approved for the CSP or from reducing the amount of financial aid paid to students who qualify for the scholarship.
Taxpayers sought and won an injunction in the district court to prohibit implementation of the CSP on the grounds that the CSP violates the Act and various provisions of the Colorado Constitution. The District appealed to the Colorado Court of Appeals, which reversed the trial court, holding that Taxpayers lacked standing to sue under the Act. Further, the Court of Appeals held that the CSP does not violate the Colorado Constitution primarily because the District may provide additional educational opportunities for its students and the CSP is intended to benefit students and their parents; any incidental benefit to religious schools results from voluntary choices made by students and parents.
Taxpayers appealed the court of appeals' decision to the Colorado Supreme Court, asking to reinstate the permanent injunction against the CSP. The Colorado Supreme Court (the Court) granted certiorari on six issues, two relating to the Act and four relating to claims under the Colorado Constitution.
Taxpayers alleged that the CSP does not comport with the Act because the Act establishes a formula to calculate the amount of money awarded to a school district "to fund the costs of providing public education," and the CSP uses public funds to finance private education. To bring a claim, a plaintiff must show an injury to a legally protected interest. The Court held that Taxpayers have no legally protected interest or claim for relief because the Act does not contain explicit language creating a private right of action to enforce the Act. Because the Act is silent on the matter of remedy, the Court applied a three-part test to determine whether the Act implies a private right of action. The Court found there is nothing in the Act that suggests the General Assembly intended to allow private parties to sue under the Act. And, by giving the State Board of Education (State Board) rule-making authority to implement the Act, the General Assembly chose to entrust enforcement of the Act to the State Board. The Court also refused to find that Taxpayers have "taxpayer standing" to enforce the Act. Taxpayer standing typically applies only to constitutional violations, and the Court declined to apply it to statutory violations. The Court's holding that Taxpayers lack standing to sue to enforce the Act resolved the two Act-related claims. In her concurring opinion, Justice Marquez would have granted taxpayer standing and concluded that the CSP violates the Act by funneling state funds to finance private education. Because she would resolve the case in favor of Taxpayers, she concurs in the judgment only.
With respect to the state constitutional issues, the Court determined that the CSP violates article IX, section 7 of the Colorado constitution (section 7), which states that "[n]either the general assembly, nor any . . . school district . . . shall ever make any appropriation, or pay from any public fund or moneys whatever, anything in aid of any church or sectarian society, or for any sectarian purpose, or to help support or sustain any school, . . .controlled by any church or sectarian denomination whatsoever . . . ." The Court determined that the term "sectarian" in section 7 is synonymous with "religious," and that the text also equates the term "sectarian" with "church" in two places, reinforcing this conclusion. "Therefore, this stark constitutional provision makes one thing clear: A school district may not aid religious schools." The Court found that the CSP aids religious schools because it encourages students to attend religious schools by providing scholarships. While the CSP does not funnel money directly to religious schools, section 7's prohibitions are not limited to direct funding. Given that religious schools rely on students' attendance and corresponding tuition for their survival, the CSP's facilitation of attendance necessarily constitutes aid to "support or sustain" those schools. The Court rejected the District's argument that the CSP features an element of private choice that severs the link between the District's aid to the student and the student's ultimate attendance at a religious school, because the fact remains that the CSP awards public money to students who may use that money to pay for a religious education. In doing so, the CSP aids religious institutions, violating the "clear constitutional command of section 7."
In reaching its decision, the Court rejected the argument that section 7 should be interpreted as a "Blaine Amendment" that arose out of anti-Catholic sentiment on the part of the framers of the Colorado Constitution and that the term "sectarian" literally means "Catholic." This interpretation would be a patent violation of the federal First Amendment as discrimination against a particular religion. However, the Court stated that the constitutionality of section 7 was not before the Court, reiterating that "sectarian" is synonymous with "religious" and that where constitutional language is plain and its meaning is clear, it must be declared and enforced as written. The Court also rejected the argument that the CSP should be upheld because it does not violate the federal First Amendment. The Court reviewed the facts and holdings of the federal school voucher cases and found that they do not apply to this case. The Court further found that the U.S. Supreme Court has held that state constitutions may be more restrictive than the federal constitution in prohibiting state support for religious institutions. Because it determined that the CSP violates section 7, the Court did not consider the remaining constitutional claims.
Justice Eid, joined by Justices Coats and Boatright, concurred in the part of the judgment holding that Taxpayers lack standing to bring the statutory claim, and dissented on the constitutional issues. (For more information, contact Brita Darling.)
Holding: The water court erroneously granted a private resort's application for a water right to divert water for "aesthetic, recreation, and piscatorial uses" where the stated uses neither constituted "beneficial uses" nor qualified as specifically listed inclusions in the statutory definition of "beneficial use".
Case Summary: Roaring Fork Club, L.L.C., the owner of a private golf, fishing, recreational, and residential resort, applied for a decree to divert 21 cubic feet per second (cfs) from the Roaring Fork River to provide "aesthetic and recreational amenity to a golf course development, as well as for fish habitat and as a private fly-fishing stream." The water court decreed the Club appropriative rights to use 21 cfs for "aesthetic, recreation, and piscatorial uses." The Colorado Supreme Court determined that the Club's stated uses did not meet the definition of "beneficial use", nor any of the three beneficial uses specifically listed under the definition, where the stated uses did not necessarily even constitute a "use" because they were entirely passive. Additionally, the Court observed that a beneficial use must have objective limits, beyond which the use would become "unreasonable, inappropriate, inefficient, or wasteful", but the Club's stated uses do not have objective limits because they are directed toward achieving subjective enjoyment by the Club's guests and "beauty, excitement, or fun cannot even conceptually be quantified." The Court noted that even the piscatorial use identified by the Club would merely be for the subjective enjoyment of its guests by creating "a more challenging recreational fishing experience." The Court concluded that the appropriation sought would be tantamount to a "forbidden riparian right" because it would merely change the path of a natural stream and recreate it on the Club's private property. Yet the Court also noted that it was for the General Assembly to approve of such uses, as it has done with the instream flow and recreational in-channel diversion programs. Thus concluding that the water court erroneously decreed the Club appropriative rights for "aesthetic, recreation, and piscatorial uses" on its private property, the Court reversed the water court's judgment and vacated the decree. (For more information, contact Jennifer Berman.)
Holding: Because plaintiff's state-licensed medical marijuana use was, at the time of his termination, subject to and prohibited by federal law, the Colorado Supreme Court affirms the Court of Appeals' holding that it was not "lawful activity" for purposes of a section 24-34-402.5, C.R.S., claim that the employer's termination of plaintiff for testing positive for marijuana use amounted to a prohibited discriminatory or unfair employmernt practice.
Case Summary: Mr. Coats, a quadriplegic, is licensed by the state of Colorado to use medical marijuana. Mr. Coats alleged that he used marijuana within the limits of the license, never used marijuana on his employer's premises, and was never under the influence of marijuana at work. The employer, Dish Network, fired Mr. Coats after he tested positive for marijuana, which established a violation of Dish Network's drug policy. Mr. Coats filed an action claiming that his termination violated the lawful activities statute, section 24-34-402.5, C.R.S., which prohibits, as "an unfair or discriminatory employment practice," an employer from terminating an employee for "engaging in any lawful activity off the premises of the employer during nonworking hours," subject to certain exceptions. Dish Network filed a motion to dismiss, arguing that the use of medical marijuana was not "lawful activity" because it was prohibited under both state law and federal law. The trial court did not consider whether Mr. Coats' marijuana use violated federal law, but granted Dish Network's motion and dismissed the case on the ground that state law made licensed medical marijuana use an affirmative defense to criminal prosecution but did not create a constitutional right to such use and did not make such use a "lawful activity" for purposes of section 24-34-402.5, C.R.S.
The Court of Appeals upheld the dismissal but used different reasoning. Because section 24-34-402.5, C.R.S., does not define "lawful activity," the Court of Appeals first looked to the ordinary meaning of the word "lawful" and determined that it means that "which is permitted by law." The Court of Appeals reasoned that because medical marijuana use is subject to both state and federal law, for such an activity to be "lawful" in Colorado it must be permitted by, and not contrary to, both state and federal law.
The Supreme Court affirmed, stating that "we agree with the court of appeals that the commonly accepted meaning of the term "lawful" is "that which is 'permitted by law' or, conversely, that which is 'not contrary to, or forbidden by law.'" The Supreme Court reasoned that the term "lawful" is used in the statute in its general, unrestricted sense. "We find nothing to indicate that the General Assembly intended to extend section 24-34-402.5's protection for 'lawful' activities to activities that are unlawful under federal law." (For more information, contact Esther van Mourik.)
Denver Classroom Teachers Ass'n v. City & County of Denver Sch. Dist. No. 1, Colorado Court of Appeals No. 13CA1530 (June 4, 2015)
Holding: Section 22-32.5-104(3)(f), C.R.S., unambiguously requires that a school obtain evidence of the majority consent of administrators, teachers employed at the school, and the school's accountability committee before submitting an innovation plan for approval to the school district or state board of education. Associations can bring a mandamus action to compel the school district and state board of education to perform a state statutory duty.
Case Summary: The Denver Classroom Teachers Association, and others (Associations) sought declaratory, injunctive, and mandamus relief against Denver public schools (DPS) regarding the implementation of the Innovation Schools Act of 2008 (Act). In the district court, the Associations argued that DPS violated the Act by implementing innovation plans at 11 district schools without first obtaining approvals for the plans from the majority of teachers employed at the schools. The district court granted relief with respect to 2 of the schools and denied relief for the remaining 9 schools. On appeal, DPS asserts that the district court lacked jurisdiction to entertain the Associations' action and the district court erred in granting relief to the Associations with respect to the 2 schools.
The Act sets forth the process for a school to receive designation as an innovation school. A significant step in the process involves the school submitting its innovation plan to the school district board of education for approval. If approved, the school district may seek designation as a district of innovation by the state board of education. A school or group of schools designated as innovation schools are granted waivers from any statutes or rules specified in their innovation plan. In addition, innovation status allows the school to waive provisions of their collective bargaining agreements following a secret ballot vote of the members of any collective bargaining unit who are employed at the innovation schools, Those waivers become effective if approved by at least 60% of the members of the collective bargaining unit. Many waivers include issues relating to the school's calendar and schedules and to teacher and staff hiring, assignments, evaluations, compensation, and dismissal.
DPS created innovation plans for schools that were academically low-performing and that were in "turnaround" or "redesign" status, schools that would be new schools replacing such schools and located in the same school buildings, and brand new schools that, at the time of the development of the innovation plan, consisted of school administrators, but had no teachers employed by the school or students enrolled in the school.
The case in the district court and on appeal concerns §22-32.5-104(3)(f), C.R.S., which requires the school's innovation plan submitted to the school district board of education to include "evidence that a majority of the administration employed at the public school, a majority of the teachers employed at the public school, and a majority of the school accountability committee for the public school consent to designation as an innovation school." The Associations alleged that DPS failed to include evidence of majority consent in its innovation plans as required by statute.
The Court of Appeals held that the district court had jurisdiction to entertain the Associations' request for mandamus relief and could grant mandamus relief so long as the Associations established that they had a clear right to relief, that DPS had a clear duty under the statute, and that the Associations had no other available remedy under the statute.
The Court of Appeals also held that the plain language of §22-32.5-104(3)(f), C.R.S., unambiguously requires DPS to seek majority consent of the innovation plans by teachers employed at the school, administrators employed at the school, and the school's accountability committee, which committee includes parents of students enrolled at the school, before submitting the plans for approval. The court found that this mandatory requirement is consistent with the intent of the legislature pursuant to §22-32.5-102, C.R.S., to ensure that teachers have flexibility to determine the most effective and efficient manner to meet students' needs and that parents, through the school accountability committee, have input regarding the educational services their children receive. The statutory purpose is frustrated if the input is not provided before the plan is approved.
Holding that a school or school district cannot develop an innovation plan without complying with the pre-submission majority consent requirement set forth in §22-32.5-104(3)(f), C.R.S., and that approval after the fact is not substantial compliance with the requirement, the Court of Appeals reversed the district court's order, in part, and remanded the case to the district court to craft appropriate injunctive relief. The injunctive relief must require DPS to resubmit innovation plans for the 11 schools that comply with §22-32.5-104(3)(f), C.R.S., and enjoin the approval of any new innovation plans that do not comply with the statute. The Court of Appeals stressed that injunctive relief is an equitable remedy and the court has broad discretion to mitigate the consequences that may result from this order. (For more information, contact Brita Darling.)
Holding: A juvenile serving an unconstitutional mandatory sentence of life without parole, which sentence is not yet final, is entitled to resentencing to determine, through an individualized consideration of the defendant's youth and attendant circumstances, whether life without parole is appropriate. If the sentencing court determines that life without parole is not appropriate, then the appropriate sentence, absent legislative action, is life in prison with the possibility of parole after forty years.
The Miller v. Alabama, 132 S.Ct. 2455 (2012), decision was procedural, not substantive; therefore it does not apply retroactively to a case in which the sentence is final and the case is on collateral review of final judgment.
Case Summary: In Miller v. Alabama, 132 S.Ct. 2455 (2012), the U.S. Supreme Court ruled that a mandatory sentence of life without parole for a juvenile is unconstitutional. From 1990 to 2006, Colorado imposed a mandatory life sentence without parole for a juvenile convicted of a class 1 felony. In People v. Tate, which was consolidated with two other cases, the Colorado Supreme Court reviewed three cases in which juveniles were sentenced to mandatory life without parole. Two of the cases were on direct appeal. In these two cases, the Court identified a court's sentencing options for juveniles who are convicted as adults of a class 1 felony, since the only statutory penalty, a mandatory life sentence without parole, is unconstitutional. The Colorado Supreme Court found that a sentencing court should determine, through an individualized consideration of the defendant's youth and attendant circumstances, whether life without parole is an appropriate sentence. A life without parole sentence for a juvenile is constitutional as long as it is not mandatory. If the sentencing court determines that life without parole is not warranted, then the appropriate sentence, absent legislative action, is life in prison with the possibility of parole after forty years.
The third case in this consolidated case was brought on collateral review of the juvenile's final judgment. The question in that case was whether the Miller decision applied retroactively to cases that have completed the direct appeal process. The Colorado Supreme Court ruled that the Miller decision was procedural, not substantive; therefore it does not apply retroactively to cases in which the judgement is final and the defendant can seek only collateral review. So, only those persons serving a mandatory life sentence without parole whose cases are still in the direct appeal process are eligible for resentencing under Miller. (For more information, contact Michael Dohr.)
Holding: The water court correctly granted an application for a nonconsumptive hydropower water right that used, at least in part, water in a ditch that was being delivered to a different, senior water right.
Case Summary: A ditch on a landowner's property delivered water for a consumptive use elsewhere by a senior water right; the ditch often diverted all the water from the stream. The landowner filed an application for a junior water right that would nonconsumptively use some of the water in the ditch to generate hydroelectricity. The water court imposed terms to prevent injury to the senior water right and granted the application. The senior water right owner conceded that no injury resulted, but argued that the law prohibited a new appropriation of the exact water that had already been appropriated.
The supreme court upheld the water court, ruling that an applicant for a junior hydropower water right may nonconsumptively use the water in a ditch that is being delivered to a senior consumptive water right further down the ditch if no injury to the senior right results; doing so maximizes the beneficial use of water. Although the senior right often diverts all available water from the stream, water is nevertheless available because the applicant can either use whatever water there may be in the stream that the junior right is entitled to use or the water in the ditch that is being delivered to the senior right. The senior water right owner does not own the actual water, merely the right of use; consequently, the landowner did not apply to use or reappropriate the senior right, but rather applied for a multiple use of particular water, which Colorado water law favors. (For more information, contact Thomas Morris.)
Holding: A legal software company is not covered by the original legal services exemption from regulation under the "Uniform Debt-Management Services Act" (Act) because the company performs substantive debt-management services without meaningful instruction and supervision by an attorney. Furthermore, the amended legal services exemption provision of the Act does not violate the separation of powers doctrine of the Colorado constitution or the commerce or privileges and immunities clauses of the United States constitution.
Case Summary: Morgan Drexen, a legal software company owned and operated by nonlawyers, provides debt-management services nationwide. Morgan Drexen contracted with a Colorado attorney as "engagement counsel", and the attorney then entered into attorney-client fee agreements with debtors. The Act requires a business that seeks to provide debt-managment services as an intermediary between creditors and debtors to be a registered debt-management services provider under the Act. The administrator of the Act denied Morgan Drexen's application for registration under the Act and issued a cease and desist order against Morgan Drexen. Morgan Drexen filed a complaint for a declaratory judgment seeking a declaration that it did not provide debt management services and that the Act, as amended, is unconstitutional. The administrator and the attorney general filed counterclaims that Morgan Drexen violated numerous provisions of the Act.
The trial court held that Morgan Drexen provided debt-management services in Colorado but was exempted from regulation under the Act through the Act's legal services exemption because the it is a nonlawyer assistant associated with a lawyer. The trial court further found that the amended Act violates the separation of powers doctrine of the Colorado constitution because the Colorado supreme court has jurisdiction over attorney regulation but the Act regulates attorneys who are not licensed in Colorado but nonetheless are authorized to practice in Colorado as well as nonlawyer assistants. The trial court also found that the amended Act violates the commerce and privileges and immunities clauses of the United States constitution by placing out-of-state attorneys at a competitive disadvantage and placing residency at issue in determining whether an attorney is subject to the Act.
The Colorado Supreme Court reversed the trial court's ruling. The court held that Morgan Drexen did not qualify as a nonlawyer assistant covered by the legal services exemption under the Act because Morgan Drexen did not act on behalf of a lawyer in providing debt-management services; rather, the lawyer Morgan Drexen contracted with as engagement counsel acted on behalf of Morgan Drexen in providing debt-management services because Morgan Drexen coordinated the attorney's efforts in negotiating with creditors. The court reasoned that a nonlawyer assistant must, at a minimum, be an employee of an attorney to fall within the scope of the Act's legal services exemption. The court also held that the amended Act does not violate the separation of powers doctrine of the Colorado constitution because regulation of attorneys under the Act does not implicate the judicial branch's regulatory authority over bar admission, discipline, or license revocation of attorneys. Finally, the court determined that the amended Act does not violate the commerce or privileges and immunities clauses of the United States constitution because the Act is facially neutral, any burden it places on out-of-state attorneys is incidental, and out-of-state attorneys can still provide debt-management services in Colorado by complying with the Act. (For more information, contact Jennifer Berman.)
Holding: The Colorado Governmental Immunity Act's (CGIA) grant of immunity to a public entity for any injury "caused by the natural condition of any unimproved property" includes a native tree originating on unimproved property even if the tree causes an injury to occur on improved property. A 2004 case that had expanded the CGIA definition of "public facility" to include as a "component" a natural object like a tree "if a public entity incorporates the object into a facility in such a manner that it becomes an integral part of the facility and is essential for the intended use of the facility" is overruled as inconsistent with the language of the CGIA.
Case Summary: The claimant and her friend were camping in Cherry Creek State Park at a campsite under trees that flanked and overhung the campsite. While they slept, an overhanging tree branch fell and injuried the claimant. The claimant brought a premises liability action against the department of natural resources, seeking compensation for her injuries. Section 24-10-106 (1) (e), C.R.S., generally waives governmental immunity for an injury "caused by a dangerous condition of any . . . public facility located in any park or recreation area maintained by a public entity," but also specifies that a public entity retains immunity "for an injury caused by the natural condition of any unimproved property, whether or not such property is located in a park or recreation area . . .". The claimant argued that the park was a public facility and that the overhanging tree branches constituted a dangerous condition of a public facility. The claimant also contended that the state had altered the trees' natural condition through incidental maintenance (pruning) and that, because the state had built the campsite under the trees, the trees were incorporated into the improved property.
The Colorado Supreme Court examined the legislative history of the CGIA and determined that the General Assembly intended to immunize the government for injuries caused by natural objects regardles of their proximity to man-made objects or facilities. The Court more specifically concluded that the General Assembly, in enacting the "natural condition of any unimproved property" language of the CGIA, intended to retain governmental immunity for injuries caused by native trees on unimproved property, regardless of their proximity to a public facility. The Court also determined that the state did not have an obligation to prune the trees, but that doing so did not create a duty to do so because assuming such a duty would discourage the state from conducting any incidental maintenance at all. Accordingly, the Court held that the state is immune under the natural condition provision of the CGIA because a natural condition of unimproved property caused claimant's injuries. Finally, the Court overruled Rosales v. City & County of Denver, 89 P.3d 507 (Colo. App. 2004), a case in which the Colorado Court of Appeals had delineated a two-part test to determine immunity: whether a tree was "integral" to the public facility and whether the tree was "essential" for the public facility's intended use. (For more information, contact Effie Ameen.)
Holding: The sentencing provisions of §19-2-601, C.R.S., for aggravated juvenile offenders do not include provisions for sentencing an offender who committed the crime as a juvenile, but who is already 21 years of age or older at the time of sentencing.The General Assembly must legislate to fill this gap. Until legislation is passed, a court may apply the provisions of §19-2-601(8), C.R.S., that do not involve participation by the department of human services and must consider all viable sentencing options under subsection (8).
Case Summary: The defendant was convicted of two counts of sexual assault on a child and two pattern of abuse sentence enhancers for sexually assaulting his younger cousins over a two-year period. He was also charged as an aggravated juvenile offender under §19-2-601, C.R.S. The trial court sentenced the defendant, at age 22, directly to the Department of Corrections' (DOC) custody for five years. The defendant appealed his direct sentence to DOC.
The court must sentence an aggravated juvenile offender pursuant to §19-2-601, C.R.S. Pursuant to that section, there are two mechanisms by which an aggravated juvenile offender may be sentenced to DOC custody. First, the department of human services (DHS), upon court order, may transfer an aggravated juvenile offender already in its custody to DOC custody if the juvenile has reached 18 years of age and DHS has certified that the juvenile is no longer benefiting from its programs. To initiate the transfer, DHS must file a request with the court. Second, the court may transfer an aggravated juvenile offender from DHS to DOC custody when the juvenile reaches 20 years and six months of age. Again, DHS initiates the process. The court notifies parties, appoints counsel, and sets a hearing. The court then must order the defendant to submit to a psychological evaluation and risk assessment. At the hearing, the court may transfer the defendant to DOC custody, authorize early release, place the defendant on adult parole, or permit DHS to retain custody over the defendant. The court must consider the statutory factors in sentencing. However, custody of and jurisdiction over a juvenile by DHS must terminate when the juvenile reaches 21 years of age.
In this case, the defendant had not been committed to DHS custody. The first mechanism expressly addresses juveniles already committed to DHS custody and who have been using DHS programs, which did not happen. The second mechanism refers to juveniles already in DHS custody who, at age 20 years and six months, are about to age out of DHS custody. At the time of sentencing, the defendant had not been committed to DHS custody, and, because defendant was already 22 years of age, he had aged out of DHS custody and jurisdiction. Because the statute does not address the defendant's situation, there is a gap in the statute concerning the proper sentencing scheme for aggravated juvenile offenders who are sentenced on or after turning 21 years of age for crimes committed as juveniles and who have therefore already aged out of DHS custody. This gap is for the General Assembly to fill.
Although the gap exists, the Court of Appeals found that it could work within the existing language of the statute, which remains the only statutory provision governing sentencing options for aggravated juvenile offenders, to effectuate the legislature's presumed intent in a manner that provides just, reasonable, and non-absurd results. Therefore, the court looked to the second mechanism in §19-2-601(8), C.R.S., that applies to convicted juveniles who are of a similar age and who are about to age out of DHS custody and held that the sentencing court may apply certain provisions of §19-2-601 (8), C.R.S., which do not require DHS participation, to defendants who fall within the statute's gap. The court lists the specific provisions that may apply. Further, the court held that a sentencing court must consider all viable options for sentencing contained in §19-2-601(8)(b), C.R.S.
While the trial court considered many of the factors listed in the statute to evaluate sentencing options, the record did not include the trial court's reasons for concluding that the defendant was not eligible for early release or adult parole for a period of five years, which are both sentencing options under the statute. Therefore, the court confirmed the defendant's conviction and remanded the case for sentencing. (For more information, contact Brita Darling.)
Holding: Sentence vacated in part and case remanded with directions for resentencing.
Case Summary: In Miller v. Alabama, 132 S. Ct. 2455 (2012), the U.S. Supreme Court held that statutes that mandate a sentence of life imprisonment without the possibility of parole are unconstitutional as applied to juvenile offenders because such application constitutes cruel and unusual punishment in violation of the Eighth Amendment to the U.S. Constitution. In Colorado, a person convicted of a class 1 felony for an offense committed as a juvenile on or after July 1, 1990, and before July 1, 2006, was sentenced to a mandatory life sentence without the possibility of parole. Several divisions of the Colorado court of appeals have recently addressed the question of how to resentence these offenders in accordance with the Miller decision. (See People v. Banks, 2012 COA 157; People v. Valles, 2013 COA 84; and People v. Gutierrez-Ruiz, 2014 COA 109.)
In the present case, the court of appeals rejects the approaches taken by the other divisions of the court and provides more flexible sentencing directions for the trial court to employ on remand. So long as an individualized sentencing determination is made in accordance with the factors in Miller, the trial court may re-impose the defendant's life sentence without parole, or it may impose a life sentence with a possibility of parole after a specified number of years, or it may impose another sentence that it determines is appropriate for the defendant. In making this sentencing determination, the court should consider (1) the presumptive range that applies to the next lowest level felony: a class 2 offense with a presumptive range of twelve to twenty-four years, and (2) the effect of any applicable extraordinary aggravating factors. The court also states that "this is an area for legislative action." (For more information, contact Richard Sweetman.)
Shafer v. Metro. Life Ins. Co., United States District Court, D. Colorado. 14-CV-00656-RM-KMT (February 19, 2015)
Holding: While the part of section 10-3-1116 (3), C.R.S., providing for a de novo standard of review for a benefit denial claim, standing alone, would not be preempted by the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. section 1001 et seq., the part of subsection (3) providing for a jury trial conflicts with ERISA's remedial structure by altering the judiciary's role. Thus, ERISA preempts, in its entirety, section 10-3-1116 (3).
Case Summary: Plaintiff Marilyn Shafer's deceased husband, Michael Shafer, was a participant in defendant Schlumberger Technology Corporation's (STC) group welfare benefits plan. Defendant Metropolitan Life Insurance Company (MetLife) issued the plan to STC.
MetLife informed plaintiff of its decision to deny benefits over the amount of $873,000.00. Plaintiff appealed this denial of benefits. After it received plaintiff's appeal letter, MetLife upheld its denial, and plaintiff filed suit against defendants. Plaintiff moved for partial summary judgment regarding the proper standard of review under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. section 1001 et seq., for a benefit denial claim. Plaintiff contended that she was entitled to a de novo standard of review and a jury trial under section 10-3-1116 (3), C.R.S.
While the part of section 10-3-1116 (3), C.R.S., providing for a de novo standard of review for a benefit denial claim, standing alone, would not be preempted by ERISA, the part of subsection (3) providing for a jury trial conflicts with ERISA's remedial structure by altering the judiciary's role. Thus, ERISA preempts, in its entirety, section 10-3-1116 (3).
A de novo standard of judicial review does not conflict with ERISA's remedial scheme because de novo review is the default standard in an ERISA case.
But, because an action under section 1132(a) of ERISA is equitable rather than legal in nature, the right to a jury trial offends ERISA's remedial structure. Section 10-3-1116 (3) offends ERISA because, under Supreme Court precedent, the right to a jury trial serves as an alternate enforcement mechanism outside of ERISA's civil enforcement provisions. The right to a jury trial is foreign to the ERISA statute. Section 10-3-1116 (3) changes the ultimate decision-making entity. It no longer is the province of the federal court to determine whether a benefit denial conflicts with ERISA or the plan's provisions but rather it is that of a jury. Congress did not foresee that a jury would be the ultimate decision-maker. Section 10-3-1116 (3), by providing the right to a jury trial, interjects a procedure that undermines section 1132(a) because it inhibits prompt adjudication by the judiciary. Section 10-3-1116 (3) supplants the remedial structure of section 1132(a). Thus, ERISA preempts section 10-3-1116 (3).
Although the court read section 10-3-1116 (6) as permitting it to sever an entire subsection from the underlying statute, it did not read section 10-3-1116 (6) as permitting it to sever a portion of a subsection, in this case a portion of a sentence, from the underlying statute. Thus, the court was unable to sever the right to a jury trial from the entirety of section 10-3-1116 (3). As such, ERISA preempts section 10-3-1116 (3) in its entirety. (For more information, contact Michele Brown.)
Holding: The Colorado Supreme Court holds that, if a plaintiff makes a prima facie showing of negligence under the doctrine of res ipsa loquitur ("the thing speaks for itself"), the burden of proof does not shift to the defendant.
Case Summary: The plaintiff sued the defendant for medical malpractice after the plaintiff's husband died hours after the defendant performed an angiogram on him. The plaintiff made a prima facie showing under the res ipsa loquitur doctrine that it was more likely than not that negligence by the defendant caused the plaintiff's husband's death. The trial court rejected the plaintiff's request to then instruct the jury that the burden of proof shifted to the defendant to establish affirmatively that he was not negligent. The Court acknowledged a conflict in the law between the holding of Weiss v. Axler, 328 P.2d 88 (1958), in which the Court held that the burden does shift to the defendant upon a plaintiff's prima facie showing of negligence under res ipsa loquitur, and Colorado Rule of Evidence 301, which provides that a rebuttable presumption merely shifts the burden of going forward with evidence - the burden of production - and not the burden of proof. Considering prior case law and the policy behind CRE 301, the Court overruled Weiss and held that, as with all other rebuttable presumptions, only the burden of production shifts under res ipsa loquitur, not the burden of proof. (For more information, contact Jennifer Berman.)
Holding: The use of public funds to cover the incidental overhead costs associated with issuing honorary proclamations recognizing a Colorado Day of Prayer does not, by itself, constitute an injury sufficient to establish taxpayer standing. Furthermore, any psychic harm endured by respondents due to media coverage revealing the existence of the honorary proclamations does not, by itself, constitute an injury sufficient to establish individual standing. Accordingly, the judgment of the court of appeals is reversed and the case is remanded with instructions to return it to the trial court for dismissal.
Case Summary: From 2004 through 2009, the governor issued annual honorary proclamations recognizing a Colorado Day of Prayer. The Freedom from Religion Foundation, Inc., and four of its members (respondents) sued the governor in his official capacity, asserting that the proclamations, which contained explicit biblical references, constituted an unconstitutional endorsement of religion in violation of the preference clause of article II, section 4 of the state constitution. The respondents sought declaratory and injunctive relief.
The trial court concluded that the respondents had individual standing to sue, but found that the honorary proclamations did not violate the preference clause and granted summary judgment in favor of the governor. The respondents appealed and the governor cross-appealed. The court of appeals affirmed the trial court's standing determination on other grounds, holding that the respondents had standing to sue as taxpayers. On the merits of the respondents' substantive legal claim, however, the court of appeals deemed the honorary proclamations unconstitutional and reversed the trial court's preference clause determination. The governor appealed.
Reviewing de novo the court of appeals' conclusion that the respondents had standing to sue, the supreme court noted the two-part test for making such a determination: A plaintiff must establish that: (1) He or she suffered an injury in fact; and (2) The injury was to a legally protected interest. The supreme court also acknowledged that Colorado courts provide for both broad taxpayer standing and broad individual standing.
Analyzing first the respondents' argument that they suffered injury sufficient to establish taxpayer standing because the governor used public funds in the course of issuing the proclamations, the supreme court held that, even assuming that the governor used public funds to pay for the paper, hard-drive space, postage, and personnel necessary to issue one Colorado Day of Prayer proclamation each year, such incidental overhead costs are not sufficiently related to the respondents' financial contributions as taxpayers to establish the requisite nexus for standing. If such costs were sufficient to confer taxpayer standing, the court reasoned, all members of the public would have standing to challenge literally any government action that required the use of a computer, basic office supplies, or state employee time-- an expansive result unsupported by the constitution or precedent.
Turning to individual standing, the supreme court held that any psychic harm endured by the respondents as a result of media coverage revealing the existence of the honorary proclamations did not, by itself, constitute an injury sufficient to establish individual standing. Rather, the respondents' circuitous exposure to the honorary proclamations (and concomitant belief that the proclamations expressed the governor's preference for religion) was too indirect and incidental an injury to confer individual standing.
Although the respondents' preference clause claim clearly satisfied the second prong of the standing test, the court held that the respondents did not establish injuries -- as either taxpayers or individuals -- sufficient to satisfy the first prong. Because the respondents failed to establish standing, the supreme court did not reach the merits of their substantive legal claim. The supreme court remanded the case to the court of appeals with instructions to return the case to the trial court for dismissal. (For more information, contact Kate Meyer.)
Holding: The Public Employees' Retirement Association (PERA) legislation, Senate Bill 10-001, did not establish any contract between PERA and its members that entitles a PERA member to the specific cost of living adjustment (COLA) formula in place on either the date on which he or she becomes eligible for retirement or the date on which he or she actually retires. The General Assembly's latest modification of the COLA formula is consistent with the PERA legislation's historical base pension benefit and changeable COLA structure. The bill's COLA reformulation did not violate the Contract Clauses of either the Colorado or United States Constitution.
Case Summary: In 2010, the General Assembly enacted Senate Bill 10-001 to protect the present and future retirees of the Public Employees' Retirement Association (PERA) by providing for an adequately funded pension plan. One of the provisions of Senate Bill 10-001 changed the formula for the annual cost of living adjustment (COLA) from an annual increase of 3.5% of the retiree's base benefit to a formula that capped the annual increase at 2% of the retiree's base benefit. Gary Justus and the other plaintiffs in the case are retired public employees who contended that they have a contract with the state of Colorado entitling each of them, upon retirement, to have their base pension benefit annually adjusted by the specific COLA formula in existence at the time they were eligible to retire for the rest of their lives without change.
The Denver District Court granted summary judgment to the state, ruling that the Plaintiffs had no reasonable expectation of receiving the benefit of a particular COLA for life given the number of times that the General Assembly has amended the COLA formulas for PERA retirees. In doing so, the District Court observed that none of the General Assembly's COLA formulas have ever contained durational language. The District Court concluded that the existence of a claimed contractual right for purposes of a contract clause claim requires a clear indication that the General Assembly intended to create such a contractual right and that the General Assembly never bound itself to calculating retirement benefits based on an unchangeable COLA.
The Colorado Court of Appeals reversed the District Court, ruling that PERA retirees have a contractual right to have their COLA benefits calculated based on the COLA formula in place at the time of either their eligibility for retirement or their actual retirement. It held that the Colorado Supreme Court's decisions in two earlier pension cases, Police Pension & Relief Bd. v. McPhail, 139 Colo. 330, 338 P.2d 694 (1959), and Police & Pension Relief Bd. v. Bills, 148 Colo. 383, 366 P.2d 581 (1961), are dispositive of the argument that retirees have a contractual right to a particular COLA. Based on those cases, the Court of Appeals concluded that "the plaintiffs have a contractual right, but that the court must still determine whether any impairment of the right is substantial and, if so, whether the reduction was reasonable and necessary to serve a significant and legitimate public purpose. " The Court of Appeals remanded the case to allow the District Court to apply the second and third parts of the three-part contract clause analysis specified in In re Estate of DeWitt, 54 P.3d 849 (Colo. 2002), which requires a court to determine: (1) Whether a contractual relationship exists; (2) If so, whether the challenged change in the law impairs the contractual relationship; and (3) If so, whether the impairment is substantial, and to thereby determine whether Senate Bill 10-001 violated the contract clauses of the United States and Colorado constitutions.
The Colorado Supreme Court reversed the Court of Appeals and upheld the District Court's summary judgment order dismissing the case, holding that the PERA statutes providing for a COLA do not establish any contract between PERA and its members entitling a PERA member to perpetual receipt of the specific COLA formula in place on either the date the member became eligible for retirement or the date on which the member actually retires.
The Supreme Court determined that the McPhail and Bills cases are not dispositive in favor of the Plaintiffs and that contrary to the Plaintiffs' argument, the contract clause balancing test established in DeWitt applies to the claim. The Supreme Court stated that in the McPhail and Bills cases, it did not address the criteria for analyzing and determining whether the legislature intended to create a contractual relationship or vested right but instead simply assumed the existence of a vested right and determined that the right had been impaired. However, the Supreme Court noted that in deciding the earlier cases, it had observed that the Denver Charter provision creating the vested right in both McPhail and Bills contained the following explicit words of entitlement: "In the event that the salaries in the Denver Police Department shall be raised after the effective date of this amendment and those members of said department who shall have previously been retired from active service and who are receiving a pension shall be entitled to an increase in the amount of their pension equal to one-half of the raise in pay granted in the rank said member held at the time he was retired. The Supreme Court stated that in comparison, the PERA statutes at issue do not use the word "entitled" or any similar words that would create an unmistakable vested contractual right. The Supreme Court also noted that neither McPhail nor Bills addressed a COLA formula that had been subject to various changes before and during retirees' careers, while the COLA formula paid to retirees changed repeatedly during the employment of each named retiree.
The Supreme Court noted that the McPhail and Bills cases were decided 40 years before the articulation of the modern contract clause test first applied in Colorado in DeWitt. The two earlier cases only addressed what is now the first part of the applicable three-part contract clause analysis. The Supreme Court stated that neither of the earlier cases examined the question of whether the legislature intended to contract, so the extent to which they are applicable to modern contract clause inquires is limited. Therefore, the Supreme Court applied the modern three-part contract clause test rather than following the earlier cases. Proceeding with the first prong of the analysis, whether there is a contractual relationship, the Supreme Court concluded that there is no contractual right to the COLA because the Court did not observe any contractual or durational language stating or suggesting a clear legislative intent to bind itself in perpetuity to paying PERA members a COLA based on a specific formula. The Supreme Court held that the General Assembly's latest modification of the COLA formula is consistent with PERA's historical pension benefit and changeable COLA structure and that the COLA reformulation in Senate Bill 10-001therefore did not violate the contract clauses of either the Colorado or the United States Constitution. (For more information, contact Nicole Myers.)
In re Arenas, United States Bankruptcy Court for the District of Colorado No. 14-11406 HRT (August 28, 2014)
Holding: Federal bankruptcy relief is not available to debtors engaged in the business of producing and distributing marijuana on the wholesale level in the state.
Case Summary: The debtors possess all of the required licenses and permits to legally engage in the business of producing and distributing marijuana on the wholesale level under Colorado law. Debtors' activities, however, make them liable for criminal penalties under the federal Controlled Substances Act, 21 U.S.C. § 801 et seq. (CSA). Because Congress acted within its constitutional powers under the Commerce Clause when it enacted the CSA, the CSA does not violate the Tenth Amendment of the United States Constitution.
Debtors' ownership and control over premises that are used in the production and distribution of a federal Schedule I controlled substance as well as debtors' direct involvement in the production and sale of a Schedule I controlled substance violate the CSA, precluding the orderly operation of a case under either chapter 7 or chapter 13 of the federal Bankruptcy Code. Administration of debtors' case is impossible without inextricably involving the bankruptcy court and debtors' trustee in debtors' ongoing criminal violation of the CSA. The trustee cannot take control of debtors' property without himself violating § 856(a)(2) of the CSA. Nor can he liquidate the inventory of marijuana plants debtors possess because that would involve the trustee in the distribution of a Schedule I controlled substance in violation of § 841(a) of the CSA.
Although the debtors' need relief that would otherwise be available to them under the federal Bankruptcy Code, it is relief that, under the circumstances, the bankruptcy court cannot provide. As a federal court, the court cannot force the debtors' trustee to administer assets under circumstances where the mere act of estate administration would require him to commit federal crimes under the CSA. Nor can the court confirm a reorganization plan that is funded from the fruits of federal crimes. (For more information, contact Michele Brown.)
Holding: The Colorado bridge enterprise qualifies as an enterprise under the Taxpayer's Bill of Rights, article X, section 20 of the Colorado constitution, (TABOR) and therefore did not violate TABOR when it levied a bridge safety surcharge as authorized by statute and issued revenue bonds payable from surcharge proceeds without prior statewide voter approval.
Case Summary: The Taxpayer's Bill of Rights, article X, section 20 of the Colorado constitution, (TABOR) requires a "district", which includes "the state or any local government, excluding enterprises," to obtain "voter approval in advance" before levying a tax or issuing revenue bonds. TABOR defines a TABOR-exempt "enterprise" as "a government-owned business authorized to issue its own revenue bonds and receiving under 10% of all annual revenue in grants from all Colorado state and local governments combined." The "Funding Advancements for Surface Transportation and Economic Recovery Act of 2009" (FASTER), §§ 43-4-801 to 43-4--814, C.R.S.: (1) Created the Colorado bridge enterprise (CBE) as a government-owned business within the Department of Transportation (CDOT); (2) Declared the CBE to be a TABOR-exempt enterprise so long as it retains authority to issue revenue bonds and receives less than 10% of its total revenues from state and local government grants; (3) Authorized the CBE to impose a bridge safety surcharge (surcharge) on motor vehicle registrations; and (4) Authorized the CBE to issue revenue bonds payable from surcharge proceeds (bonds) for the purpose of funding the repair and replacement of state highway system bridges designated as structurally deficient or functionally obsolete (designated bridges). The CBE, without first obtaining statewide voter approval, exercised the authority granted to it by FASTER by imposing the surcharge, issuing revenue bonds, and repairing and replacing designated bridges.
The TABOR Foundation (Foundation), a nonprofit advocacy organization that endeavors to defend TABOR, filed a lawsuit in Denver District Court against the CBE, the Colorado Transportation Commission (Commission), and the individual members of the Commission in their official capacities. The Foundation alleged that the CBE does not satisfy the requirements for TABOR-exempt enterprise status because: (1) The surcharge is a tax, and enterprises may not levy taxes; (2) The CBE is not a government-owned business; and (3) The CBE receives more than 10% of its annual revenues from state and local government grants. The Foundation further alleged that because the CBE is not a TABOR-exempt enterprise, it violated TABOR when it imposed the surcharge and issued bonds without first obtaining statewide voter approval. Accordingly, the Foundation requested that the Denver District Court issue: (1) A declaratory judgment that the CBE violated TABOR by imposing the surcharge and issuing bonds without voter approval; (2) Orders setting aside the surcharge and directing the CBE and other defendants to refund all surcharge and bond revenue kept in violation of TABOR plus 10% simple interest as required by TABOR; (3) A permanent injunction prohibiting the CBE and other defendants from issuing additional revenue bonds without voter approval; and (4) An award of costs and attorney fees.
In May 2013, the Denver District Court conducted a bench trial. At the trial, the Foundation tried to make the case that the CBE is not a TABOR-exempt enterprise and thus violated TABOR by failing to obtain statewide voter approval before levying the surcharge and issuing bonds because: (1) The CBE levies the surcharge on most motor vehicles registered in Colorado without regard to whether any given vehicle is actually driven over a designated bridge, and the surcharge is therefore a tax subject to TABOR voter approval requirements rather than a fee paid in exchange for a specific service; (2) The Colorado Supreme Court had previously held in Nicholl v. E-470 Pub. Hwy. Auth., 896 P.2d 859 (Colo. 1995), that the power of taxation is inconsistent with TABOR-exempt enterprise status; and (3) The CBE received more than 10% of its annual revenue in state government grants in the form of $14.4 million in federal grant money provided to it by the Commission and 56 designated bridges transferred to it by CDOT. The trial court made extensive findings of fact and ruled in favor of the CBE and the other defendants on all claims, concluding that: (1) The surcharge is a fee, not a tax; (2) Neither the $14.4 million in federal grant money nor the designated bridges were state government grants for purposes of TABOR; and (3) The CBE is a TABOR-exempt enterprise and therefore was not required to obtain voter approval before levying the surcharge or issuing bonds. The Foundation appealed the trial court's decision.
The Colorado Court of Appeals affirmed the trial court's judgment in favor of the CBE and the other defendants. The Court of Appeals first held that the surcharge is not a tax because: (1) Its primary purpose is to fund a specific service, the repair and replacement of designated bridges, rather than to fund general government purposes; (2) Surcharge revenues are deposited to and expended from special designated accounts where they are segregated from other state money and spent only to fund the repair and replacement of designated bridges and therefore cannot be spent for general government purposes like taxes can; (3) The amount of the surcharge is reasonably related to the cost of repairing and replacing designated bridges; (4) The surcharge is levied on a class, persons who register motor vehicles in Colorado, who are reasonably likely to benefit from the service even though not every motor vehicle crosses a designated bridge; and (5) Colorado law does not require the surcharge to be voluntary to be considered a fee. The Court of Appeals then held that the CBE is a TABOR-exempt enterprise because: (1) The surcharge is a fee, not a tax; (2) The CBE is a business "because it pursues a benefit and generates revenue by collecting fees from service users"; and (3) The applicable statutory definition of "grant" set forth in §43-4-803 (13), C.R.S., which defines "grant" as "any direct cash subsidy or other direct contribution of money from the state or any local government in Colorado which is not required to be repaid" and specifically excludes "[a]ny federal funds received by the [CBE] regardless of whether the federal funds pass through the state or any local local government prior to receipt by the [CBE]" is valid and precludes both the designated bridges and federal funds received by the CBE from being "grants". (For more information, contact Jason Gelender.)
Holding: The Court of Appeals held that the terms "importune, invite, and entice", as used in the statute prohibiting internet sexual exploitation of a child, require a defendant to do more than just allow a person to continue viewing the defendant's intimate parts for a conviction for internet sexual exploitation of a child to stand.
Case Summary: The defendant, Heywood, was charged with internet sexual exploitation of a child. Relevant to this case, the criminal statute reads:
"An actor commits internet sexual exploitation of a child if the actor knowingly importunes, invites, or entices through communication via a computer network . . . or instant message, a person whom the actor knows or believes to be under fifteen years of age and at least four years younger than the actor, to . . . observe the actor's intimate parts via a computer network . . . or instant message." §18-3-405.4 (1) (b), C.R.S.
Heywood, while in an adult-only chat room and without any information about the viewer's age, invited a person to view a web cam stream of himself masturbating. The viewer, a Jefferson County District Attorney's investigator posing as a 14-year-old girl, accepted the web cam stream. Heywood then asked about the viewer's age. The viewer told Heywood that she was 14 years of age. Upon learning the viewer's age, Heywood did not immediately stop the webcam stream, but told the viewer that she should not be watching. The conversation continued for about 5 minutes before Heywood turned off the web cam stream and the conversation ended shortly thereafter. A jury convicted Heywood of internet sexual exploitation of a child. Heywood appealed his conviction arguing that there was insufficient evidence to show that he "importuned, invited, or enticed" the viewer to view his intimate parts.
The Court of Appeals had to determine what "importune, invite, and entice" meant in this statutory context. The court found that the terms were unambiguous and that the terms require an actor to do more than merely allow a person to continue viewing the actor's intimate parts after the actor learns the person's age. The Court stated that "had the General assembly intended more broadly to prohibit allowing a person under the age of fifteen to view the actor's intimate parts through a computer network, it could have said so." The Court determined there was no evidence presented that Heywood believed the viewer was under age 15 when he invited her to view the stream. Nor was there any evidence that Heywood importuned, invited, or enticed the viewer to continue viewing the stream after the viewer revealed her age as 14. The Court reversed the conviction. (For more information, contact Michael Dohr.)
Holding: A state agency may not retroactively cancel previously approved and taken leave time to avoid having to pay essential state employees overtime compensation.
Case Summary: The Plaintiffs (employees) are designated as “essential” employees at a facility operated by the Colorado Department of Human Services (DHS) that provides medical care to veterans and operates 24 hours a day, 7 days a week. The employees each requested and received approval from their supervisors to take paid leave time which, when combined with their work time, totaled more than 40 hours in a workweek. At the end of the pay period, DHS adjusted each of the employee’s timesheets to reflect only 40 hours of work for the week pursuant to State Personnel Rule 3-34, which allows state agencies to cancel an essential employee’s authorized leave to reduce overtime liability.
Section 24-50-104.5 (1), C.R.S., provides that authorized paid leave time counts as work time for the purposes of providing overtime compensation to essential state employees. Accordingly, the employees grieved the alteration of their timesheets and requested to be paid at the overtime rate for work time that exceeded 40 hours. The facility administrator denied the grievances on the merits and the employees petitioned the state personnel board for review. Ultimately, the State Personnel Director (Director) upheld the denial of the employees’ grievances. She determined that pursuant to section 24-50-104.5 (1), C.R.S., she was authorized to promulgate rules, including Rule 3-34, to administer the statute and applicable federal laws. The employees sought judicial review, and the District Court upheld the Director’s decision ruling that a supervisor’s discretion to authorize leave time pursuant to section 24-50-104.5 (1), C.R.S., includes the discretion to cancel the authorization after the end of the workweek. The employees appealed.
The case presented an issue of first impression in Colorado: Can a state agency, pursuant to section 24-50-104.5, C.R.S., retroactively cancel previously approved and taken leave time to avoid having to pay essential employees overtime compensation? The Court of Appeals concluded that a state agency may not retroactively cancel previously approved leave time and reversed the District Court’s judgment.
The Court of Appeals determined that the purpose of section 24-50-104.5 (1), C.R.S., is to provide overtime compensation for state employees who, because of the nature of their jobs and designation as essential employees, may have to work beyond forty hours at unexpected or unusual times, even if they did not actually work some of their normally scheduled hours that week. The Court confirmed that this was the General Assembly’s intent by reviewing the legislative history of section 24-50-104.5, C.R.S. (Section 24-50-104.5, C.R.S., was originally enacted as a different statutory section.) The House and Senate sponsors of the bill that enacted the original statute testified that in 1993 the Director promulgated a rule that eliminated the prior practice of counting authorized leave and holidays as work time when computing overtime compensation. The bill sponsors explained that the purpose of the bill was to restore the prior practice of counting such authorized leave for the purpose of computing overtime compensation for essential employees.
The Court of Appeals further concluded that the General Assembly’s intent is best given effect by interpreting section 24-50-104.5 (1), C.R.S., to require an agency to cancel previously authorized leave before the employee actually takes the leave. Allowing agencies to “de-authorize” leave that employees take in reliance on the leave authorization would allow an agency to avoid having to pay overtime compensation based, in part, on authorized leave time. This would be in direct contravention of the statute and would remove any incentive for essential employees to work unexpected shifts. For these reasons, the Court of Appeals concluded that DHS was not empowered under section 24-50-104.5, C.R.S., to cancel the previously authorized leave time of its essential employees.
Regarding Rule 3-34, the Director perceived that section 24-50-104.5 (1), C.R.S., authorized her to promulgate rules necessary to administer the statute and applicable federal laws. However, the statute only authorizes the Director to establish rules necessary for the state personnel system to fully comply with all applicable federal employment laws, and the Court of Appeals found that no rules were needed to bring section 24-50-104.5 (1), C.R.S., into compliance with those federal laws. The Director and DHS further argued that the Director’s authority to promulgate rules regarding overtime compensation for essential state employees exists by virtue of her authority to oversee the state’s total compensation philosophy pursuant to section 24-50- 104, C.R.S. However, the Court of Appeals found that the section 24-50-104.5, C.R.S., does not empower the Director to enact regulations that would permit state agencies to avoid statutory requirements. Therefore, any appropriate procedure to determine and maintain overtime pay must provide that authorized paid leave be counted toward the total work time of essential employees.
Because the Court of Appeal did not discern any legislative intent to allow the Director to cancel statutory benefits conferred by section 24-50-104.5, C.R.S., it concluded that Rule 3-34 could not be used to such effect. The Court of Appeals held that DHS did not have the authority to withdraw or cancel the employees’ previously authorized leave time after the employees had actually taken the approved leave time and that the leave time must be counted toward calculating the employees’ right to overtime compensation. (For more information, contact Nicole Myers.)
Holding: Section 24-72-204(5), C.R.S., mandates an award of costs and reasonable attorney fees in favor of any "prevailing applicant" who applies for and receives an order from the District Court requiring a custodian to permit inspection of a public record even if the order represents only a partial victory because the right to inspect other records is denied.
Case Summary: This case arises out of a 2006 request by the Colorado Republican Party ("Party") under the Colorado Open Records Act ("CORA") to inspect survey responses prepared by Benefield and other current or former members of the Colorado House of Representatives (the "Representatives"). After several years of litigation, the Party succeeded in obtaining an order allowing it to inspect 925 of the 1,584 surveys that it had originally requested. The District Court ultimately determined that the remaining 659 survey responses were not subject to inspection under CORA. The Party then moved for costs and attorney fees expressly provided for a prevailing applicant under section 24-72-204 (5), C.R.S. The District Court denied the motion on the grounds that the statutory mandate for an award of costs and attorney fees in favor of a "prevailing applicant" contemplated only an applicant who prevailed in the litigation as a whole. The District Court concluded that there was no "prevailing party" in the litigation and that the Party therefore was not a "prevailing applicant" within the meaning of CORA.
On appeal by the Party, the Colorado Court of Appeals reversed. The Court of Appeals construed the word "prevailing" to describe any applicant who succeeds in acquiring, as the result of filing an application with the district court, access to any record as to which inspection had previously been denied by the custodian. Because the Party succeeded, after filing its action, in obtaining the right to inspect public records, access to which had previously been denied by the Representatives, the Court of Appeals concluded that the Party was entitled as a matter of right to an award of costs and attorney fees. The Colorado Supreme Court agreed with the Court of Appeals that section 24-72-204 (5), C.R.S., mandates an award of costs and attorney fees in favor of any person who applies for and receives an order from the District Court requiring a custodian to permit inspection of any public record. Accordingly, the Supreme Court affirmed the judgment of the Court of Appeals. On remand, the Supreme Court ordered the District Court to exercise its discretion in determining the amount of costs and reasonable attorney fees to which the Party, as a prevailing applicant, is entitled in light of its partial success in the litigation. (For more information, contact Bob Lackner.)
Holding: Under the statute requiring automatic revocation of a driver's license for driving with a blood alcohol content (BAC) of 0.08% or more, the Department of Revenue ("Department") can use evidence taken by a police officer despite not having probable cause for the initial contact, and need not follow the exclusionary rule in the revocation hearing.
Case Summary: The Department revoked Tom Francen’s driver’s license pursuant to § 42-2-126(3)(a)(I), C.R.S. (2011), following a hearing officer’s determination that Francen had driven a motor vehicle with a BAC in excess of the statutory maximum. The district court reversed, holding that the initial stop of Francen’s vehicle was not supported by reasonable suspicion. The court of appeals reversed the district court and held that the legality of the initial contact between the police and Francen was not relevant in the civil administrative proceeding to revoke his driver’s license. The court also held that the exclusionary rule did not apply to suppress evidence of his BAC.
Francen petitioned for certiorari review by the Colorado Supreme Court, which held that:
(a) Under section 42-2-126, C.R.S., as it existed at the time of the administrative hearing, "probable cause" referred to the quantum and quality of evidence necessary for a law enforcement officer to issue a notice of driver’s license revocation, not whether the officer’s initial contact with the driver was lawful; and
(b) The exclusionary rule did not apply to suppress evidence of Francen’s BAC in the driver’s license revocation proceeding.
Justice Hood wrote a dissenting opinion in which he cited a series of Court of Appeals decisions uniformly inferring the requirement of a legal initial stop from the earlier version of the statute (which was ambiguous on this point) and noted that, in response to the Court of Appeals' departure from that precedent in this case, the General Assembly had promptly amended the statute to clarify that the legality of the initial stop is relevant. Justice Hood condemned the "judicial quagmire" created by the majority's interpretation of the prior law, which establishes a window of time during which a driver cannot defend against a revocation on this basis. However, a driver whose revocation hearing is held after the amendment of the statute, or under the prior version of the statute but before the date of the majority's opinion in this case, could raise the issue of the legality of the initial stop.
The majority and dissenting opinions in this case present competing views on the application of certain principles of statutory construction, including the principle that the General Assembly is presumed to be aware of, and to endorse, existing judicial interpretations of a statute whenever it amends the statute in ways that do not directly address those interpretations. (For more information, contact Duane Gall.)
Holding: [Companion case to Francen v. Dept. of Revenue, 2014 CO 54] Under the statute requiring automatic revocation of a driver's license for driving with a blood alcohol content (BAC) of 0.08% or more, the Department of Revenue ("Department") can use evidence taken by a police officer despite not having probable cause for the initial contact, and need not follow the exclusionary rule in the revocation hearing.
Case Summary: The Department revoked Andrew Hanson’s driver’s license pursuant to § 42-2-126, C.R.S. (2011), following a hearing officer’s determination that Hanson had improperly refused a blood alcohol test. Hanson maintained that evidence of his refusal should have been suppressed because the officer who first determined that he should submit to the test had entered his home without a warrant and without probable cause to arrest him for DUI. The district court and court of appeals upheld the revocation.
Hanson petitioned for certiorari review by the Colorado Supreme Court, which held that:
(a) Under section 42-2-126, C.R.S., as it existed at the time of the administrative hearing, "probable cause" referred to the quantum and quality of evidence necessary for a law enforcement officer to issue a notice of driver’s license revocation, not whether the officer’s initial contact with the driver was lawful. In this case, the officer who made the initial, warrantless entry into Hanson's home was not the officer who arrested him for DUI and demanded that he submit to the alcohol test; the arrest and refusal occurred at a local hospital after Hanson was taken there at the officers' request.
(b) The exclusionary rule did not apply to suppress evidence of Hanson’s refusal in the driver’s license revocation proceeding. Instead, evidence need be excluded only if the misconduct of law enforcement officials was done in bad faith or shocks the conscience of the court.
Justice Hood wrote a dissenting opinion in which he noted that the majority had extended the reach of the companion opinion (Francen) "beyond an illegal traffic stop to a warrantless home entry--'the "chief evil" against which the Fourth Amendment is directed.'." In addition, the facts of this case led to a situation in which Hanson was also deprived of the right to cross-examine the officer who made the initial, warrantless entry into his home. That officer failed to appear at the administrative hearing although he had been issued a subpoena.
(For more information, contact Duane Gall.)
Holding: The Secretary of State exceeded his rulemaking authority in promulgating Rule 10.7.5. The rule contravenes section 1-4-1002(2.5), C.R.S., as well as election code provisions that require issues regarding a certified candidate's eligibility to be resolved by the courts. The rule is therefore void.
Case Summary: The Adams 12 Five Star School District ("Adams 12") held a regular biennial nonpartisan school district director election on November 5, 2013. Approximately one week before the election, after ballots had been printed and distributed and mail ballot voting was underway, the designated election official concluded that candidate Amy Speers, who had been certified to and appeared on the ballot, was ineligible for office and sent her a letter requesting that she withdraw her candidacy. Speers neither conceded ineligibility nor filed an affidavit of withdrawal.
On election day, the Colorado Secretary of State ("Secretary") adopted Rule 10.7.5, which provided that "[if] the designated election official determines, after ballots are printed, that an individual whose name appears on the ballot is not qualified for office, the votes cast for that individual are invalid and must not be counted". Because Rule 10.7.5 was promulgated as a temporary or emergency rule, it took effect immediately. To comply with the rule, the Adams and Broomfield County clerks and recorders did not report the votes cast for Speers in the election.
On November 14, 2013, plaintiffs, registered electors of Adams 12, sued the Secretary in Denver District Court under section 24-4-106, C.R.S., of the Administrative Procedures Act, seeking judicial review of Rule 10.7.5. After conducting a hearing, the district court concluded that the Secretary acted in excess of his rulemaking authority in promulgating Rule 10.7.5. The Secretary appealed that holding to the Colorado Supreme Court. (The plaintiffs also brought a separate claim against the election officials to compel the completion of the vote count and certification of the election results. The district court ordered the election officials to complete the vote count and certify the vote tally, but that decision was not appealed.)
The Colorado Supreme Court affirmed the judgment of the district court for different reasons. The Court concluded that Rule 10.7.5, as a rule of general applicability, conflicted with section 1-4-1002(2.5)(a), C.R.S., which provides that where a vacancy occurs less than eighteen days before an election due to a partisan candidate's disqualification, votes cast in the election for that disqualified candidate "are to be counted and recorded." The Court also held that Rule 10.7.5 conflicted with the "Uniform Election Code of 1992" by impermissibly allowing designated election officials to usurp the courts' express authority to determine issues of eligibility concerning a candidate who has been certified to the ballot. Because the Secretary acted in excess of his rulemaking authority in promulgating a rule that contravened both section 1-4-1002(2.5), C.R.S., and election code provisions that require issues regarding a certified candidate's eligibility to be resolved by the courts, the Court declared the rule void. (For more information, contact Kate Meyer.)
Independence Inst. v. Gessler, United States District Court, D. Colorado, Civil Action No. 10-cv-00609-PAB-MEH (March 29, 2014)
Holding: The limitation in section 1-40-112 (4), C.R.S., on per signature compensation for initiative or referendum petition circulators violates the first amendment to the United States constitution. The limitation severely restricts the political speech rights of petition proponents by making it substantially more difficult for them to get their petitions on the ballot because the limitation is likely to deter most itinerant professional petition circulators from working in the state, prevent the hiring of low-volume professional circulators, and significantly increase the costs of signature gathering campaigns. Also, there is no evidence that the limitation protects the integrity of the initiative and referendum process by reducing incentives for fraud or ensuring that a higher percentage of signatures collected are valid.
Case Summary: Petition circulators, non-profit organizations, and petition entities (plaintiffs) involved in the initiative and referendum process in Colorado filed an action under 42 U.S.C. § 1983 in the United States District Court for the District of Colorado (district court) that challenged the constitutionality of Colorado's limitation, set forth in section 1-40-112 (4), C.R.S., on per-signature compensation for petition circulators on free speech grounds under the First Amendment to the United States Constitution (first amendment).
Section 1-40-112 (4), C.R.S., makes it "unlawful for any person to pay a circulator more than twenty percent of his or her compensation for circulating petitions on a per signature or petition section basis." As a practical matter, the statute requires that circulators receive most of their compensation in the form of hourly payments.
Plaintiffs claimed that the limitation on per signature compensation for petition circulators severely infringed their first amendment rights to free speech by decreasing the pool of professional circulators who are necessary for successful signature gathering campaigns and increasing the cost of signature gathering efforts, thus making it more difficult to qualify measures for the statewide ballot. Plaintiffs also claimed that there was no evidence that the limitation would protect the integrity of the initiative and referendum process by reducing the rate or incidence of fraud in the initiative and referendum signature gathering process.
After considering the evidence presented at trial, the district court found that the limitation on per signature compensation for petition circulators was likely to deter most itinerant professional petition circulators, the most efficient and effective circulators, from working in the state, prevent the hiring of low-volume professional circulators, and significantly increase the cost of signature gathering campaigns. The court also found that the cost increase resulting from the limitation would reduce the chances of underfunded proponents succeeding in the initiative and referendum process and that there was no evidence that the limitation would reduce the rate or incidence of fraud in the signature gathering process.
In light of its factual findings, the district court concluded that because the limitation on per signature compensation for petition circulators prevented initiative and referendum proponents from using individuals who would most effectively convey their message to the public to collect signatures, section 1-40-112 (4), C.R.S., imposed a severe burden on such proponents' first amendment rights, which required the court to use the strict scrutiny standard of review to determine the constitutionality of the statute. Based on this standard of review, and given the availability of other effective and less burdensome statutory tools to safeguard the state's interest in reducing fraud and the number of invalid petition signatures, the district court concluded that section 1-40-112 (4), C.R.S., violated the first amendment. Accordingly, the district court permanently enjoined the secretary of state from enforcing section 1-40-112 (4), C.R.S., and any ancillary statute that enforced it, namely, sections 1-40-135 and 1-40-121, C.R.S., to the extent that those sections apply to the limitation on per signature compensation. (For more information, contact Michele Brown.)
Holding: Allowing a defendant fewer peremptory challenges than authorized or than exercised by the prosecution is not a structural error that automatically requires reversal.
Case Summary: The trial court improperly denied defense counsel's motion to challenge a juror for cause because the person was employed as an assistant attorney general. Defense cousel was required to use a peremptory challenge to remove the potential juror. The court of appeals applied a rule that requires automatic reversal under these facts. Overruling prior holdings to the contrary, the Colorado supreme court held that the trial court's denial of defense counsel's motion was not a structural error that requires automatic reversal. Rather, in this situation the court must determine whether the error was harmless under the proper outcome-determination test, in which case reversal is not required. (For more information, contact Jerry Barry.)
Holding: The court of appeals erred in interpreting section 10-2-704 (1) (a) to create a fiduciary relationship between a bail bonding agent and the person whose money the bail bonding agent accepted to post bail for the defendant because neither the defendant nor the person who provided bail money was an insured to whom the bail bonding agent owed a fiduciary duty under the statute.
Case Summary: The Division of Insurance investigated Trujillo, a bail bonding agent, based on a complaint received from Connie Espinoza (Espinoza) who gave Trujillo $3,500 to bail her son out of jail. Trujillo never posted bail for Espinoza's son because the $3,500 was insufficient to post bail. Trujillo failed to return the money to Espinoza. Trujillo was sanctioned for nine violations of the insurance code, including a violation of his fiduciary duty as an insurance producer under section 10-2-704 (1) (a), C.R.S. The Colorado Court of Appeals determined that Trujillo had a fiduciary relationship with Espinoza because, as the defendant's mother who gave Trujillo money to post bail, Espinoza was a proper agent of the insured to whom Trujillo owed a fiduciary duty.
The Colorado Supreme Court reversed the court of appeals' decision on grounds that Trujillo and Espinoza did not have a fiduciary relationship under the statute. The Court analyzed section 10-2-704, C.R.S., which provides that an insurance producer owes the insured or a proper agent of the insured a fiduciary duty with respect to unearned premiums held by the insurance producer. Noting that "insured" is not a defined term in the statute, the Court analyzed common law surety principles to determine which party is analogous to the "insured" in a bail bonding context. The Court reasoned that the trial court, and not the defendant, is the party most analogous to an insured in the bail bonding context because a bail bonding agent posts bond to protect the court against the risk of the defendant's failure to appear. Therefore, Espinoza was not a proper agent of the insured, and Trujillo did not owe her a fiduciary duty. (For more information, contact Jennifer Berman.)
Daimler Chrysler Fin. Serv. Ams. v. Colo. Dept. of Rev., Colorado Court of Appeals No. 12CA2559 (March 13, 2014)
Holding: A lending arm of a motor vehicle manufacturer that finances the full price, including all sales tax due, of motor vehicle sales made by dealers to vehicle purchasers using retail installment contracts cannot claim a credit for a portion of sales taxes forwarded in full to dealers for payment to the Colorado department of revenue when purchasers ultimately default on the installment contracts. The specific provisions of section 39-26-113 (6), C.R.S., which allow only a seller-financer to claim such a credit, control and apply in lieu of the conflicting but more general provisions of section 39-26-102 (5), C.R.S. Because Daimler is not a seller-financer, it is not entitled to a sales tax credit under section 39-26-113 (6), C.R.S.
Case Summary: Consumers purchased motor vehicles from several motor vehicle dealers using retail installment contracts secured by liens on the vehicles. At the time of the sales, the dealers assigned all of their rights under the installment contracts to Daimler Chrysler Financial Services Americas, LLC, (Daimler), which paid the dealers the entire amounts due on the contracts, including the sales tax due. The dealers then remitted the sales tax to the Colorado Department of Revenue (DOR). Some purchasers defaulted on their installment contracts, and Daimler repossessed and sold the vehicles. Even after the sales, there remained unpaid balances for some of the contracts. Daimler charged off those debts for federal income tax purposes and sought a bad debt tax credit from the DOR pursuant to section 39-26-102(5), C.R.S., which generally allows a taxpayer who is a retail seller responsible for collecting sales tax, including a taxpayer that is a group or combination acting as a unit, to claim such a tax credit. The DOR denied the claim. Daimler then filed a complaint in Denver District Court, which also denied the claim. Daimler then appealed to the Colorado Court of Appeals. The Court of Appeals affirmed.
The Court of Appeals found that sections 39-26-102 (5) and 39-26-113 (6), C.R.S., conflict. Both sections provide a tax credit against sales taxes paid for taxes paid on accounts that are subsequently charged off as bad debts, but section 39-26-113 (6), C.R.S., controls under the rule of statutory construction that requires specific statutes to override more general conflicting statutes because that section more specifically addresses such situations for motor vehicle sales and allows only seller-financers to claim tax credits.
The Court of Appeals noted that if Daimler and the dealers were indeed a "unit" or "group" in the sale and financing of the vehicles then they would be acting as seller-financers and could claim a credit under section 39-26-113 (6), C.R.S, Section 39-26-116 (6), C.R.S., however, only considers a seller-financer to be a seller licensed in the state of Colorado which itself or through "a wholly-owned affiliate or subsidiary" collects all or part of the total consideration paid for a vehicle. Because Daimler is neither a licensed seller in Colorado nor a wholly-owned affiliate or subsidiary of the dealers with which it contracted, it does not meet the requirements of section 39-26-113 (6),C.R.S. and cannot claim the credit. The Court of Appeals concluded that the General Assembly would not have taken pains in section 39-26-113 (6), C.R.S., to award tax only to seller-financers of motor vehicles if all other motor vehicle retailers might avail themselves of the tax credit provided for in the more general provisions of section 39-26-102 (5), C.R.S. (For more information, contact Esther van Mourik.)
Holding: Currently, a debtor cannot take your home to satisify a debt if the owner has less than $60,000 of equity. Section 38-41-205, C.R.S., states: "The homestead mentioned in this part 2 may consist of a house and lot or lots or of a farm consisting of any number of acres." The question was whether the term "farm" covers water rights appurtenant to the land. The court held that water rights necessary to use land for agricultural purposes are included in the term "farm." Therefore, unless they exceed the $60,000 limit, water rights necessary to use land for agricultural purposes cannot be taken to satisfy a debt.
Case Summary: Due to a default judgement, the defendant owed plaintiff $4,400,000, but the plaintiff had been unable to collect. To satisfy the debt, the plaintiff tried to force a judicial sale of the defendant's water rights. The trial court ruled that the term "farm" did not include water rights, so the defendant could sell them to satisfy the debt.
The defendant appealed. The question before the appeals court was whether "farm" included water rights. The court reasoned (1) that the term "lot" was already used, so the term "farm" could not mean merely the dirt; it had to mean something more. And (2) to have a farm, you must have agriculture, but to have agriculture, you typically need water. Therefore, water rights, if necessary for agriculture, are appurtenant to the land and are covered by the term "farm". (For more information, contact Jery Payne.)
Holding: Section 1-45-103.7 violates the equal protection rights of contributors to write-in, unaffiliated, and minor party candidates for public office.
Case Summary: In November 2002, Colorado voters passed Amendment 27, Colo. Const. Art. XXVII, § 2, which imposed restrictions on campaign financing. The General Assembly enacted HB 04-1121 to implement sections of Amendment 27. Section 1-45-103.7 regulates contributions using a per-election framework. Individuals and political committees may contribute a total of $400 to a candidate who participates in both a primary election and a general election (that is, $200 per election). Candidates who participate in a primary and a general election may accept $400 contributions at any time and may commingle primary election funds and general election funds without limitation. Individuals and political committees may contribute only $200 to primary-exempt candidates, that is, candidates who participate only in a general election.
A candidate from either of the two major political parties — the Democratic Party of Colorado and the Colorado Republican Party — is always subject to a primary election, regardless of whether his or her bid for the party nomination is contested by another candidate. Therefore, for all statewide elections, all major party candidates may receive contributions of up to $400. By contrast, a candidate for any of the three minor political parties — the Libertarian Party of Colorado, the American Constitution Party, and the Green Party of Colorado — is subject to a primary election only if his or her bid for the party nomination is contested by another candidate.
In 2010, contributors to Kathleen Curry, a write-in candidate for House District 61; Ms. Curry; her campaign committee; and the Libertarian Party (plaintiffs) sued Governor John Hickenlooper and then Secretary of State Scott Gessler (defendants) under 42 U.S.C. § 1983, challenging the constitutionality of former § 1-45-103.7 (3) and (4) (now section 1-45-103.7 (3), (4), and (4.5)) under the First Amendment and the Equal Protection Clause of the Fourteenth Amendment of the United States Constitution in the United States District Court for the District of Colorado (district court).
Plaintiffs contended that Amendment 27 is ambiguous and susceptible to multiple interpretations and that defendants' interpretation of Amendment 27, as reflected by § 1-45-103.7, violated their First Amendment rights. Specifically, plaintiffs claimed that § 1-45-103.7 violated their freedom of expression and freedom of association rights as well as their Fourteenth Amendment rights to equal protection under the law. Plaintiffs raised both a facial and an "as applied" challenge to the constitutionality of § 1-45-103.7 and charged that the statute was: (1) facially unconstitutional as it abridges the associational and expressive First Amendment rights of all contributors to campaigns of primary-exempt candidates; (2) unconstitutional as applied to contributors to Ms. Curry as it abridges their associational and expressive rights by limiting their ability to contribute to Ms. Curry's candidacy; (3) facially unconstitutional as it abridges the Fourteenth Amendment rights of all contributors to campaigns of primary-exempt candidates; and (4) unconstitutional as applied to contributors to Ms. Curry as it restricts their ability to contribute to Ms. Curry's campaign in the same manner as other similarly situated contributors.
The district court found that Amendment 27 was constitutional as applied to plaintiffs. That finding refuted the contention that Amendment 27 is unconstitutional in all conceivable circumstances. The district court also found that defendants were entitled to summary judgment on plaintiffs' facial and as applied First Amendment challenge to Amendment 27 and its implementing statutes. In addition, the district court found that defendants were entitled to summary judgment on plaintiffs' facial and as applied Fourteenth Amendment Equal Protection challenge to Amendment 27 and its implementing statutes.
Plaintiffs appealed to the United States Court of Appeals for the Tenth Circuit (court of appeals), which reversed the district court. The court of appeals held that the statute, as applied, violated the contributors' rights to equal protection.
The court of appeals held that the statute improperly discriminates among contributors when major- and minor-party candidates are unopposed for their nominations. The statute does not set contribution limits based on who has a primary and who doesn't. Instead, the statute blurs the distinction by allowing Republican and Democratic candidates who are not opposed in their primary elections to collect and spend the entire $400 after the primary. Thus, a Republican or Democratic candidate can obtain $400 from a single contributor and spend all of the money in the general election. For the same general election, a write-in candidate can obtain only $200 from a single contributor.
The court of appeals concluded that section 1-45-103.7 treats individuals contributing to Ms. Curry differently than the individuals contributing to the Republican and Democratic candidates. After the primary, a supporter of Ms. Curry could give her only $200. At the same time, others could contribute $400 each to the Republican and Democratic candidates, and the candidates could spend that money in the general election. In this way, the statute treats contributors differently based on the political affiliation of the candidate being supported. And by treating the contributors differently, the statute impinges on the right to political expression for those who support Ms. Curry or other nominees who are unable to obtain funds prior to nomination.
The defendants relied solely on the state's asserted interest in fighting corruption. But the court of appeals found that that interest is not advanced by a law that allows Republicans or Democrats to collect larger donations than write-ins, unaffiliated candidates, or minor-party nominees. The state created different contribution limits for candidates running against each other, and those differences have little to do with fighting corruption. The statutory classification violates the right to equal protection for individuals wishing to contribute to write-ins, unaffiliated candidates, and minor-party candidates when each candidate runs unopposed for the nomination. (For more information, contact Michele Brown.)
Holding: The prior participation requirement of Article XXI, Section 3, of the state constitution (which provides that a vote for a successor candidate in a recall election does not count "unless the voter also voted for or against the recall of such person sought to be recalled from said office" conflicts with the First and Fourteenth Amendments to the United States Constitution.
Case Summary: In June 2013, citizens in Pueblo and El Paso Counties certified petitions to recall State Senator Angela Giron and State Senator John Morse. Governor John Hickenlooper set a September 10 recall election for both Senate seats. These recall elections were the first in Colorado's history for members of the General Assembly. On August 23, 2013, the Governor, pursuant to Article VI, Section 3, of the Colorado Constitution, submitted the following Interrogatory to the Colorado Supreme Court: "Colo. Const. art. XXI, § 3 requires an elector who wishes to vote for a successor candidate in a recall election to also cast a ballot on the recall issue. Is this requirement consistent with the First and Fourteenth Amendments to the United States Constitution?"
The Court exercised its original jurisdiction and issued an order answering the Interrogatory in the negative. Specifically, the Court found that the so-called "prior participation requirement" of Article XXI, Section 3,conflicts with voters' First Amendment associational rights by unconstitutionally compelling voters to speak on the recall question. The Court reasoned that, because the First Amendment protects the voters' right to refrain from speaking, and the prior participation requirement commands the opposite, that requirement is plainly unconstitutional.
With regard to the Fourteenth Amendment to the United States Constitution, the Court held that the prior participation requirement effectuates a severe limitation on citizens' fundamental right to vote by completely invalidating a voter's otherwise legal ballot for a successor candidate if the voter simply fails to vote or chooses not to vote on the wholly distinct recall issue. The Court found that no compelling, or even rational, justification exists to nullify a voter's entire ballot simply because he or she refrains from answering the initial recall question. (For more information, contact Kate Meyer.)
Holding: A lifetime supervision sex offender is subject to section 17-22.5-403 (8) (b), C.R.S. when his or her parole is revoked, not section 17-2-103 (11) (b), C.R.S.
Case Summary: Defendant pled guilty to one count of sexual assault on a child and the court sentenced him to 10 years to life of sex offender intensive supervised probation. After violating the conditions of probation twice, the court resentenced the defendant to two years to life in the department of corrections. The defendant was released on parole. The defendant violated the conditions of his parole and his parole was revoked. The parole board returned the defendant to the department of corrections for the remainder of his sentence, the rest of his natural life, as allowed under section 17-22.5-403 (8) (b), C.R.S. Defendant argued that he should have only been returned for 180 days under section 17-2-103 (11) (b), C.R.S., which applies generally to parole revocations.
The Court of Appeals found that section 17-2-103 (11) (b), C.R.S., and section 17-22.5-403 (8) (b), C.R.S., conflict when applied to the parole revocation for a sex offender who is subject to lifetime supervision. The Court found there was a conflict since both provisions could apply to a sex offender's parole revocation and result in different outcomes. Section 17-2-103 (11) (b), C.R.S., provides multiple placement options for an offender when parole is revoked, however section 17-22.5-403 (8) (b), C.R.S.,only permits a lifetime supervision sex offender to be placed in the department of corrections. Each section also differs in the length of the revocation. Under section 17-2-103 (11) (b), C.R.S., the length of revocation could be a maximum of 180 days depending on the revocation basis. But, section 17-22.5-403 (8) (b), C.R.S., allows revocation up to the natural life of the offender. The Court of Appeals determined that section 17-22.5-403 (8) (b), C.R.S., is the more specific provision and therefore it applies to the revocation of a lifetime supervision sex offender's parole. The legislative history of section 17-22.5-403 (8) (b), C.R.S., also supports this conclusion. The bill sponsor's statements show the legislature intended that a lifetime supervision sex offender could be subject to a life sentence upon a parole revocation. (For more information, contact Michael Dohr.)
Holding: Colorado law prohibits "Lone Pine" orders, which courts in jurisdictions outside Colorado have issued to reduce discovery burdens on courts and defendants in complex mass tort and toxic tort cases involving multiple parties. Such orders require a plaintiff to present prima facie evidence supporting his or her claims after initial disclosures, but before other discovery commences, or risk having his or her case dismissed.
Case Summary: William and Beth Strudley filed a toxic tort case against defendants, Antero Resources Corporation, Antero Resources Piceance Corporation, Calfrac Well Services Corp., and Frontier Drilling LLC, ("defendants"), alleging that defendants' natural gas drilling operations had contaminated the air, water, and ground near their home and caused property damage and personal injuries. The parties filed initial disclosures pursuant to Colorado Rule of Civil Procedure ("C.R.C.P.") 26, but shortly thereafter defendants made a motion requesting a "Lone Pine" order that would require the Strudleys to present prima facie evidence to support their claims before full discovery could commence. "Lone Pine" orders, named for the 1986 New Jersey Superior Court case in which a court first issued one, have been issued by courts in jurisdictions outside Colorado to reduce potential burdens on defendants and the court in complex cases, particularly complex mass tort and toxic tort cases involving multiple parties, where the discovery process is likely to be burdensome and the plaintiff's ability to sustain his or her burden of proof is questionable. The trial court granted defendants' motion and issued a modified "Lone Pine" case management order that, among other things, required the Strudleys to provide specified types of expert evidence in support of their claims.
The Strudleys provided neither an expert opinion that concluded that the alleged property damage or personal injuries were directly caused by the companies' conduct, nor expert evidence documenting alleged physical injuries through medical examination. Defendants moved to dismiss the Strudleys' claims pursuant to C.R.C.P. 37 or, in the alternative, for summary judgment. In response, the Strudleys asserted that their submissions complied with the "Lone Pine" order and that dismissal was not appropriate. The Strudleys further argued that issues of material fact existed that precluded a grant of summary judgment. The trial court dismissed all of the Strudleys' claims with prejudice, finding that the Strudleys had failed to present the required prima facie evidence, specifically in relation to causation. The Strudleys appealed, arguing that Colorado law prohibits "Lone Pine" orders.
The Colorado Court of Appeals reversed the dismissal of the Strudleys' claims and held that Colorado law prohibits "Lone Pine" orders and that the trial court erred as a matter of law when it issued a "Lone Pine" order. The Court of Appeals cited Colorado Supreme Court precedent that held that a trial court abuses its discretion by requiring a showing of a prima facie case before allowing discovery of documents containing trade secrets, Curtis, Inc. v. Dist. Court, 526 P.2d 1335, 1339 (Colo. 1974), and that nothing in the Colorado Unfair Practices Act required a prima facie showing, Direct Sales Tire Co. v. Dist. Court, 686 P.2d 1316, 1319 (Colo. 1984). The Court of Appeals read "these cases to stand for the proposition that a trial court may not require a showing of prima facie case before allowing discovery on matters central to a plaintiff's claim - as opposed to matters relating to punitive damages or other secondary matters."
While acknowledging that recent amendments to the Colorado Rules of Civil Procedure were intended to create a "differential case management/early disclosure/limited discovery system", the Court of Appeals did not read those revisions to be so substantial as to effectively overrule the holdings in Direct Sales Tire Co. and Curtis. The Court of Appeals also noted that the Colorado version of C.R.C.P. 16 does not include the language relied upon by federal courts when issuing "Lone Pine" orders, found that exiting procedures under the Colorado Rules of Civil Procedure sufficiently protect against meritless claims, and concluded that a "Lone Pine" order was therefore not required solely for that protective purpose. The Court of Appeals concluded that Lone Pine orders are prohibited and that by issuing a "Lone Pine" order, the trial court had unduly interfered with the Strudleys' opportunity to prove their claims.
On April 7, 2014, the Colorado Supreme Court granted certiorari on this case. (For more information, contact Esther van Mourik.)
Holding: Trying a defendant for a misdemeanor that is elevated to a felony through application of the habitual domestic violence offender statute, without the procedural protections that accompany a felony trial, violates the Colorado constitution.
Case Summary: The defendant, Eli Manuel Vigil, was charged in two separate criminal cases with multiple misdemeanor offenses. In both cases, at least one of the misdemeanors had an underlying factual basis of domestic violence. Because Vigil had been previously convicted of other misdemeanor charges that had an underlying factual basis of domestic violence, the prosecutor moved to have Vigil adjudged as an habitual domestic violence offender (HDVO) under section 18-6-801 (7), C.R.S. This section, provides that, if the court finds that the defendant is an HDVO, the defendant is convicted of a class 5 felony, even if the charge is a misdemeanor, and sentenced to the presumptive range for a class 5 felony. The court found that Vigil was an HDVO and sentenced him as a class 5 felony offender to two concurrent three-year terms.
Vigil appealed, arguing that the HDVO statute violated his statutory and constitutional rights. Because Vigil was charged with misdemeanors, his case was tried in county court without the procedural guarantees that accompany a felony trial, including the right to a 12-person jury, which is required by the Colorado Constitution. The Court of Appeals agreed and remanded the case to a jury trial in district court.
The Court of Appeals writes that application of the HDVO statute in this case constitutes structural error, meaning that it "affects the framework in which the trial proceeds and requires automatic reversal because it renders the trial fundamentally unfair." Even though Vigil was tried for a misdemeanor, through application of the HDVO statute he was subject to a potential felony conviction and sentence. Therefore he was entitled to a 12-person jury, "which is guaranteed to defendants facing felony conviction and sentencing in the Colorado courts." (For more information, contact Joel Moore.)
Indus. Claim Appeals Office v. Colo. Dept. of Labor & Employment, Colorado Supreme Court No. 12SC49 (July 1, 2013)
Holding: The Colorado Supreme Court reverses the Court of Appeals and holds that the offset provision in the unemployment compensation (UI) statutes (section 8-73-110 (3) (a) (I) (B), C.R.S.) requires a dollar-for-dollar reduction in UI benefits if the claimant is receiving pension benefits from the same employer, regardless of whether that employer contributed pension benefits during the "base period" on which the UI benefits are calculated. In this respect the Supreme Court finds that Colorado's UI law differs from the corresponding federal provision in the Federal Unemployment Tax Act (FUTA) due to the conspicuous absence of the qualifying phrase "during the base period."
Case Summary: Kathleen Hopkins worked for the Colorado Department of Labor and Employment at two separate times. During her first period of employment, the Department made regular contributions to its retirement fund on her behalf, and, upon her retirement, Ms. Hopkins began drawing a pension. Later, she returned to work at the Department until her employment was terminated for unspecified reasons.
During this second period of employment, the Department did not contribute to the retirement fund on Ms. Hopkins' behalf, and she received no additional pension benefits attributable to that period. However, she applied for, and was awarded, UI benefits due to her involuntary separation from employment.
The amount of UI benefits was calculated according to Ms. Hopkins' earnings during the "base period" of her second period of employment with the Department. But that amount was less than she was already receiving in retirement benefits. Section 8-73-110 (3) (a) (I) (B), C.R.S., requires UI benefits to be offset by "the prorated weekly amount of a pension, retirement or retired pay ... contributed to by a base period employer." The Industrial Claim Appeals Office (ICAO) found that this language precluded her from receiving any UI benefits, since the Department (her "base period employer") had contributed to her retirement.
Ms. Hopkins appealed to the Colorado Court of Appeals, which reversed the finding of the ICAO on the basis that the offset provision implicitly did not apply if, as here, the base period employer's contribution to the retirement fund had not occurred during the base period.
The Supreme Court reversed the Court of Appeals, effectively reinstating the ICAO's order. The Supreme Court reasoned that, if the offset provision had been intended to apply only if the base period employer had made pension contributions during the base period, it would have contained the phrase "during the base period." In the absence of any such temporal limitation, therefore, the plain language of the offset provision required that Hopkins forgo UI benefits.
The Supreme Court also acknowledged that Colorado's UI statute was patterned on, and is complementary to, FUTA, under which an offset is made only when the base period employer makes retirement contributions "after the beginning of the base period." (26 U.S.C. §3304(a)(15).) But instead of citing this fact in support of Hopkins' claim, as the Court of Appeals had done, the Supreme Court drew a contrast between the language of the two statutes and found that the General Assembly had clearly not intended Colorado's offset provision to operate in the same way as the FUTA offset provision. (For more information, contact Duane Gall.)
Holding: Colorado's public school financing system does not violate the Colorado Constitution.
Case Summary: Lobato v. State of Colo. Bd. of Edu., 2013co30 (May 28, 2013). The Supreme Court reverses the Denver District Court's finding that the public school financing system is unconstitutional.
As a threshold matter, applying the law of the case doctrine, the Supreme Court affirmed its decision in Lobato v. State (218 P.3d 358 (Colo. 2008)) ("Lobato I") that the plaintiffs' claims are justiciable. The Court held that determining whether the state's public school financing system is rationally related to the constitutional mandate of the General Assembly to provide a "thorough and uniform system of public education" does not infringe on the legislature's policy-making authority and is therefore not a nonjusticiable political question.
With respect to the plaintiffs' claim that the public school financing system contained in sections 22-54-101 to 22-54-135, C.R.S., violates article IX, section 2 of the Colorado Constitution ("the Education Clause"), the Court initially defined the phrase "thorough and uniform." The Supreme Court held that "the phrase thorough and uniform in the Education Clause describes a free public school system that is of a quality marked by completeness, is comprehensive, and is consistent across the state." Further, the Court held the Education Clause of the Colorado Constitution "simply establishes the constitutional floor upon which the General Assembly must build its education policy."
The Court then applied the "rational basis test" that the Court delineated in Lobato I. Presuming that the statutes that make up the public school financing system are constitutional, the Court determined that it must uphold the legislation unless the plaintiffs prove beyond a reasonable doubt that the statutes are not rationally related to the General Assembly's mandate under the Education Clause to provide a "thorough and uniform system of public education." The Court held that Colorado's public school financing system is rationally related to the "thorough and uniform" mandate of the Education Clause because it funds a public education system that is of a quality marked by completeness, is comprehensive, and is consistent across the state. In doing so, the Court highlighted the General Assembly's creation of a single statutory framework that allows the state to calculate every school district's total program, describes the sources of state and local revenue that make up the calculated amounts, and applies the public school financing system uniformly to all school districts in the state. While the Court recognized that the public school financing system may not provide an optimal amount of money for the public schools, the statutory framework, itself, is constitutional.
With respect to the plaintiffs' claim that the public school financing system violates article IX, section 15 of the Colorado Constitution ("the Local Control Clause"), the Court held that the public school financing system is constitutional because the system gives school districts control over locally raised funds and therefore over "instruction in the public schools." Citing prior case law, the Court affirmed that a dual-funded (local and state moneys) public school financing system is constitutional so long as it allows the school districts to retain control over how they spend locally generated tax revenue. The Court noted that, even though the trial court found that school districts use a substantial portion of their locally raised funds to help students achieve state standards, nothing in the public school financing system itself requires a particular allocation of funds. Further, the financing system also provides mill levy overrides and bonded indebtedness mechanisms that authorize school districts to raise additional revenue beyond their total program, thereby allowing the school districts to exert additional local control over instruction by generating and expending supplemental local funds. While "disparities in wealth" may impair a low-wealth school district's ability to pass mill levy overrides or bonded indebtedness and, thus, its ability to exert local control, this does not invalidate the entire public school financing system under the Local Control Clause. Therefore, because the public school financing system does not affirmatively require school districts to use their locally raised revenue in a particular manner, the statutory system is constitutional.
In conclusion, the Court states that the Court's job is not to determine whether a better financing system could be devised by the General Assembly but whether the current public school financing system passes constitutional muster. In entering its decision that the public school financing system is constitutional, the Court states that it satisfies its duty to "say what the law is" without unduly infringing upon the policy-making power of the legislature, thereby affording the General Assembly the opportunity to reform Colorado's education policy, including its public school financing system. (For more information, contact Brita Darling.)
Holding: The court held that a person could be convicted for two offenses based upon the same conduct: driving under restraint, §42-2-138, C.R.S., and driving after revocation, §42-2-206, C.R.S.
Case Summary: The court held that a person could be convicted of driving under restraint, §42-2-138, C.R.S., and driving after revocation, §42-2-206, C.R.S. A revocation is a type of restraint. So if a person is convicted of both offenses because of a revoked license, it looks as if the two provisions forbid the same conduct.
This is matters legally because the double jeopardy clauses of the United States and Colorado constitutions prohibit a person from being "twice put in jeopardy" for the same conduct. One way a person could be put in double jeopardy is to be convicted, based on the same conduct, of two crimes that have the same elements.
In 1992, an appellate court held that a person could not be convicted under these two statutes for the same conduct. See People v. Rodriguez, 849 P.2d 799 (Colo. App. 1992). In this case, the court specifically stated "We disagree with Rodriguez and decline to follow it." The court then upheld the convictions of the defendant under both of these statutes.
The court reasoned that one provision applies to "operating" a motor vehicle and the other to "driving" a motor vehicle. The court argued that "operating" is a broader term than "driving." Further, one provision applies on "highways on this state" and the other provision applies in "this state." Again, the court argued that "highways" doesn't include private ways. Therefore, the elements were different enough to apply to different conduct. (For more information, contact Jery Payne.)
Town of Milliken v. Kerr-McGee Oil & Gas Onshore LP, Colorado Court of Appeals No. 12CA1618 (May 9, 2013)
Case Summary: The Town of Milliken adopted a land use code provision that imposed a fee on oil and gas wells and associated equipment and structures to pay for safety and security inspections of oil and gas facilities. The town sued an oil and gas operator to collect the fee. The operator moved for summary judgment, arguing that that fee violated a prohibition on such fees in the state oil and gas statute. The trial court granted the motion and dismissed the case.
On appeal, the Court of Appeals upheld the dismissal, finding that the town lacked statutory authority to impose the fee. Section 34-60-106 (11) (a) (II), C.R.S., gives the Colorado oil and gas commission authority to promulgate rules "to protect the health, safety, and welfare in the conduct of oil and gas operations." Section 34-60-106 (15), C.R.S., prohibits local government from imposing inspection fees "with regard to matters that are subject to . . . regulation . . . by the commission". Because the safety and security of oil and gas facilities is subject to regulation by the commission under section 34-60-106 (11) (a) (II), C.R.S., the plain language of section 34-60-106 (15), C.R.S., prohibits a municipality from imposing a fee to conduct safety and security inspections at oil and gas facilities. (For more information, contact Thomas Morris.)
Holding: Because plaintiff's state-licensed medical marijuana use was, at the time of his termination, subject to and prohibited by federal law, the court of appeals held that it was not "lawful activity" for purposes of a section 24-34-402.5, C.R.S., claim that the employer's termination of plaintiff was discriminatory.
Case Summary: Mr. Coats, a quadriplegic, is licensed by the state of Colorado to use medical marijuana. Mr. Coats alleged that he used marijuana within the limits of the license, never used marijuana on his employer's premises, and was never under the influence of marijuana at work. The employer, Dish Network, fired Mr. Coats after he tested positive for marijuana, which established a violation of Dish Network's drug policy. Mr. Coats filed an action claiming that his termination violated the lawful activities statute, section 24-34-402.5, C.R.S., which prohibits an employer from discharging an employee for "engaging in any lawful activity off the premises of the employer during nonworking hours," subject to certain exceptions. Dish Network filed a motion to dismiss, arguing that the use of medical marijuana was not "lawful activity" because it was prohibited under both state law and federal law. The trial court did not consider whether Mr. Coats' marijuana use violated federal law, but granted Dish Network's motion and dismissed the case on the ground that state law made licensed medical marijuana use an affirmative defense to criiminal prosecution but did not create a constitutional right to such use and did not make such use a "lawful activity" for purposes of section 24-34-402.5, C.R.S.
The Court of Appeals upheld the dismissal but used different reasoning. Because section 24-34-402.5, C.R.S., does not define "lawful activity," the Court of Appeals first looked to the ordinary meaning of the word "lawful" and determined that it means that "which is permitted by law." The Court of Appeals reasoned that because medical marijuana use is subject to both state and federal law, for such an activity to be "lawful" in Colorado it must be permitted by, and not contrary to, both state and federal law: "While we agree that the general purpose of section 24-34-402.5 is to keep an employer's proverbial nose out of an employee's off-site off-hours business, we can find no legislative intent to extend employment protection to those engaged in activities that violate federal law." Not allowing a Colorado employer to terminate "an employee for federally prohibited off-the-job activity is of sufficient policy import that we cannot infer, from plain statutory language to the contrary and silence in the legislative discussions, the legislative intent to do just that." (For more information, contact Esther van Mourik.)
Holding: Under section 17-1-111, C.R.S., regulations for implementing a death sentence are not subject to the Administrative Procedures Act.
Case Summary: The Executive Director of the Department of Corrections issued regulations establishing the procedures to implement a death sentence. Nathan Dunlap, an inmate on death row, filed suit alleging that the regulations are void because the Executive Director did not comply with the rule-making procedures of section 24-4-103, C.R.S., when promulgating the regulations. Section 17-1-111, C.R.S., excludes regulations that relate "to the placement, assignment, management,discipline, and classification of inmates", as authorized in title 17, C.R.S., from the requirements of section 24-4-103, C.R.S. The Court of Appeals agreed with the Executive Director that section 17-1-111, C.R.S., applies to regulations that establish the procedures to implement a death sentence, even though implementing a death sentence is not specifically authorized in title 17, C.R.S. So, the regulations are not subject to the requirements of section 24-4-103, C.R.S. (For more information, contact Jerry Barry.)
Case Summary: The Colorado Court of Appeals decided two cases addressing whether a defendant whose conviction is overturned on appeal is entitled to a restitution refund. In both cases, the court of appeals noted that the issue lends itself to legislative action and encouraged the General Assembly to consider the issue.
In the first case, People v. Nelson, Nelson appealed her convictions; the court of appeals overturned the convictions and granted Nelson a new trial. Nelson was acquitted of all charges at her retrial. In the second case, People v. Madden, Madden was convicted of two offenses at trial. On appeal, the Colorado Supreme Court overturned one of the two convictions. Next, Madden sought post-conviction relief related to the other conviction arguing that his attorney was constitutionally ineffective. The court considering the post-conviction relief request granted Madden's motion and vacated the remaining conviction. The prosecution decided not to appeal the postconviction order or retry the case.
In both cases, the trial courts denied the defendants a restitution refund on retrial. But the court of appeals determined that the defendants are entitled to seek a refund of the restitution since the defendants were not reconvicted of the charges on remand. The defendants are entitled to seek a refund in the criminal cases without having to file a separate proceeding.
The court of appeals noted that the cases included myriad questions, some of which contain difficult public policy questions that may be appropriate for legislative consideration. One of the circumstances that makes this issue difficult is that the state may have to ask for the restitution back from the victim if the state has already distributed the restitution. In the Madden case, the trial court refused to refund the restitution because "[i]t wasn't anything that [the victim] did wrong." The court reasoned that the victim should not lose because the defendant's attorney was constitutionally ineffective. The court of appeals in the Nelson case also noted that the standard for awarding restitution is not as high as obtaining a conviction, but there still must be a conviction. So it is possible to award restitution related to acts that were not charged in the criminal case as long as the uncharged acts are related to the charged acts on which the conviction is based. (For more information, contact Michael Dohr.)
Case Summary: In 2009, Philip and Roberta Jordan were involved in a car accident with a minor driver, J.F. The Jordans were injured and they sued J.F. The Jordans settled their claims against J.F. for $60,000 and $38,500 respectively. The Jordans sought underinsured motorist benefits from their insurance carrier, Safeco, to cover the difference between the settlement amount and the $100,000 per person limit of J.F.'s liability insurance coverage. On appeal, the Jordans stipulated that neither of their injuries exceeded $100,000.
The court determined that, under the Jordans' insurance contract and the statute concerning underinsured motorist coverage, as amended in 2007, the Jordans were not entitled to receive more than the settled amount they received from J.F. Before the statute was amended, it required an insurance carrier to pay the amount of damages sustained by the insured in excess of any amount paid to the insured by the tortfeasor in settlement of a claim or by judgment of a court. But, as amended, the statute only requires an insurance carrier providing underinsured motorist coverage to pay the amount of damages sustained by the insured in excess of the other driver's legal liability coverage. Therefore, the Jordans would have been entitled to underinsured motorist coverage from Safeco only if their injuries exceeded the $100,000 per person limit of J.F.'s liability coverage. (For more information, contact Jennifer Berman.)
Taxpayers for Pub. Educ. v. Douglas Cnty Sch. Dist., Colorado Court of Appeals No. 11CA1856 (February 28, 2013)
Holding: The Douglas County School District's Choice Scholarship Program (CSP) does not violate the religion or public appropriations provisions of the Colorado Constitution and plaintiffs do not have standing to assert claims relating to the enforcement of the Public School Finance Act. The trial court's entry of a permanent injunction against implementation of the CSP is reversed.
Case Summary: Taxpayers for Pub. Educ. v. Douglas Cnty Sch. Dist., 2013COA20 (February 28, 2013) The Court of Appeals reversed the trial court's entry of a permanent injunction to prohibit implementing the Choice Scholarship Program (CSP), a program designed to assist Douglas County students with tuition at participating private schools. The scholarships equal 75% of district per pupil revenue with the district retaining up to 25% for administrative expenses. The district created a charter school to authorize and distribute the scholarships. To qualify, a student must reside in Douglas County and must have been enrolled in a Douglas County school the year before applying for the CSP.
As a preliminary matter, the Court held that the plaintiffs do not have standing to pursue private claims to enforce the Public School Finance Act (the Act), section 22-54-101, et seq., C.R.S., because the Act expressly commits enforcement of its provisions to the State Board of Education (SBE) and provides the SBE with enforcement mechanisms. A private right of action would be inconsistent with the purposes of the Act. Also, while legal precedent has recognized taxpayer standing with respect to constitutional violations, the test for standing under a statute is more rigorous, and the Court found no authority for asserting taxpayer status in the context of enforcing a statute.
With respect to the various claims under the Colorado Constitution, the Court determined that an action taken by a school district board of education, as a legislative body and a political subdivision of the state, is entitled to a presumption of constitutionality. This presumption requires the Court to uphold the CSP absent proof beyond a reasonable doubt that the program is unconstitutional and that a clear and unmistakable conflict exists between the CSP and a provision of the Colorado Constitution.
Relying primarily on Lujan v. Colo. State Bd. of Educ, 649 P.2d 1005 (Colo. 1982), the Court found that Article IX, Section 2 of the Colorado Constitution does not prevent a school district from providing educational opportunities to its students in addition to and different from the thorough and uniform system required by the Constitution, and a school district may expend public funds to provide these opportunities. The district designed the CSP to provide choice to students and their parents, to provide individualized education opportunities, to improve educational performance through competition, and to obtain a higher return on investment for educational spending.
Further, relying primarily on Americans United for Separation of Church and State Fund, Inc., v. State, 648 P.2d 1072 (Colo. 1982) and Colorado Christian University v. Weaver, 534 F.3d 1245 (10th Cir. 2008), the Court determined that the CSP does not violate Art. IX, Section 4 of the Colorado Constitution because the CSP is neutral in that the purpose of the CSP is to aid students and parents, not sectarian institutions. Also, the CSP is available to all district students and to any private school that meets neutral eligibility criteria, without impermissible inquiry into or judgments related to the pervasiveness of the school's religious beliefs. Also, a student is not compelled to participate in the CSP or to attend any particular participating school. A student's attendance at religious services happens as a result of a parent's voluntary choices. As such, the CSP also does not violate Art. IX, Section 8 of the Colorado Constitution because that provision applies to public educational institutions and public schools, and private schools are not transformed into public schools through the use of a public charter school to facilitate the CSP. Religious requirements of the participating private school are not imputed to the charter school and are, therefore, not the result of government action.
Additionally, the CSP does not violate Art. IX, Section 7 of the Colorado Constitution. Citing Americans United and Zelman v. Simmons-Harris, 536 U.S. 639 (2002), the Court found that, since the CSP is intended to benefit students and their parents, any benefit to the participating school is incidental and does not constitute aid to an institution within the meaning of the constitutional provision. The Court made no distinction in this analysis between institutions of higher education and elementary and secondary schools.
Finally, the CSP does not violate Article V, Sections 32 and 34 of the Colorado Constitution, which restrict appropriations to institutions that are not under the control of the state and to sectarian institutions. Once the Department of Education receives appropriations made by the General Assembly and distributes those appropriations to school districts, ownership of those moneys passes to the school districts, and the school districts' expenditures do not constitute an appropriation by the General Assembly. Further, citing Americans United, the Court found that the benefit of the CSP is to the student, not the institution, and the aid serves a discrete and particularized public purpose.
Because plaintiffs failed to carry their burden of proving unconstitutionality beyond a reasonable doubt and the plaintiffs do not have standing to assert a claim under the Act, the appellate court reversed the order enjoining the implementation of the Act. In April, the plaintiffs filed for review by the Colorado Supreme Court (2013SC233). (For more information, contact Brita Darling.)
Case Summary: The Colorado court of appeals found a statutory conflict between section 18-1-503.5 (1), C.R.S., and section 18-7-407, C.R.S. Section 18-1-503.5 (1), C.R.S., is a general provision, applicable to the entire criminal code, that states:
If the criminality of conduct depends on a child being younger than eighteen years of age and the child was in fact at least fifteen years of age, it shall be an affirmative defense that the defendant reasonably believed the child to be eighteen years of age or older. This affirmative defense shall not be available if the criminality of conduct depends on the defendant being in a position of trust.
Section 18-7-407, C.R.S., is limited to child prostitution crimes. It states:
In any criminal prosecution under sections 18-7-402 to 18-7-407, it shall be no defense that the defendant did not know the child's age or that he reasonably believed the child to be eighteen years of age or older.
The court of appeals found the sections conflict because one provision allows a reasonable belief defense and the other expressly forbids it.
The defendant, Houser, was charged with patronizing a prostituted child. Houser sought to raise the affirmative defense that he had a reasonable belief that the prostitute was 18 years of age or older, arguing that section 18-1-503.5, C.R.S., permitted this defense. The trial court ruled that section 18-7-407, C.R.S., precluded the defense. The Court of Appeals affirmed the trial court's decision finding there was no "clear and unmistakable" intent by the General Assembly that the general provision in section 18-1-503.5 (1), C.R.S., would control over the specific provision in section 18-7-407, C.R.S., even though section 18-1-503.5, C.R.S., was enacted after section 18-7-407, C.R.S. (For more information, contact Michael Dohr.)
Case Summary: Reversing the Court of Appeals, the Supreme Court held that the trial court abused its discretion when it tendered the "sudden emergency" jury instruction. Additionally, the Supreme Court abolished the sudden emergency doctrine, Trial courts may no longer give the sudden emergency jury instruction in negligence cases, because the instruction's potential to mislead the jury greatly outweighs its minimal utility.
The Respondent, Johnson, slid on a patch of ice, lost control of his vehicle, and collided with Petitioner, Bedor. Both Bedor and Johnson were injured. Bedor filed a negligence action against Johnson. Johnson asked that the jury be instructed on the sudden emergency doctrine, arguing that he acted reasonably in light of the sudden emergency the ice presented. Bedor's counsel objected. The instruction was tendered, and the jury found that although Bedor suffered injuries and damages as a result of the accident, Johnson was not negligent and therefore did not cause Bedor's injuries and damages. The jury awarded Johnson approximately $34,000 in costs. Bedor appealed, and the Court of appeals affirmed the jury verdict holding that the sudden emergency instruction was properly tendered because there was competent evidence that Johnson was confronted with a sudden or unexpected occurence--the ice patch--that was not of his own making. The Supreme Court granted certiorari on the issue of whether a driver who loses control of a vehicle in winter driving conditions, crosses into oncoming traffic, and collides with a vehicle is entitled to the sudden emergency jury instruction. The Court also requested supplemental briefing on whether a separate, sudden emergency jury instruction should continue to be given in negligence cases.
CJI-Civ. 4th 9:11 states: "A person who, through no fault of his or her own, is placed in a sudden emergency, is not chargeable with negligence if the person exercises that degree of care that a reasonably careful person would have exercised under the same or similar circumstances." Johnson lost control of the car when he hit the patch of ice. Unlike other cases that evoke the sudden emergency doctrine, where drivers took deliberate action when confronted with an unexpected occurrence, the Supreme Court found that Johnson's loss of control of the vehicle indicates a complete lack of such a deliberate action. In addition, Johnson testified that he was aware that ice frequently formed on that part of the road and inconclusive evidence showed that Johnson's pre-accident conduct, potential drinking or speeding, may have contributed to the accident. For those reasons, the Supreme Court held that the evidence did not completely or reasonably support the sudden emergency jury instruction and the trial court abused its discretion in tendering the instruction.
In reviewing the sudden emergency doctrine in general, the Supreme Court held that Colorado negligence law no longer requires the sudden emergency instruction because its minimal utility in Colorado's comparative negligence scheme is greatly outweighed by the instruction's danger of misleading the jury. First, with respect to its minimal utility, the sudden emergency doctrine is no longer necessary to offset the harsh effects of the comparative negligence defense whereby a plaintiff's negligence was a complete bar to recovery. However, the General Assembly enacted a comparative negligence statute to accomplish the same end. While the sudden emergency doctrine does not conflict with Colorado's comparative negligence statute, the court cannot overlook its potential to mislead the jury. Second, the instruction does not enrich the body of jury instructions but unnecessarily repeats the "reasonable care under the circumstances" standard articulated in two other pattern jury instructions that apply to all circumstances, including sudden occurrences.
Moreover, the sudden emergency doctrine presents a serious risk of misleading the jury because: (1) It fails to instruct the jury to find two important facts, that the person, through no fault of his or her own, was placed in a sudden emergency, before applying the sudden emergency doctrine; (2) It does not define "sudden emergency"; (3) It implies that sudden emergency situations require a reduced standard of care; and (4) It focuses the jury's attention on facts that transpired during and after the incident, rather than on the totality of the circumstances, including the defendant's actions that may have caused the emergency in the first place. Because these potentially misleading characteristics of the sudden emergency jury instruction greatly outweigh its minimal utility, the Supreme Court abolished the sudden emergency doctrine. (For more information, contact Brita Darling.)
Case Summary: The Colorado court of appeals found that the section 18-1.3-509, C.R.S., was ambiguous since it was silent on an issue that would be expected to be within its scope. Section 18-1.3-509, C.R.S., addresses presentence confinement credit for misdemeanor cases. Section 18-1.3-405, C.R.S., also addresses presentence confinement, but for offenses generally. Section 18-1.3-405, C.R.S., is substantially the same as section 18-1.3-509, C.R.S., except that it contains one additional sentence not found in section 18-1.3-509, C.R.S. The additional sentence reads:
If a defendant is serving a sentence or is on parole for a previous offense when he or she commits a new offense and he or she continues to serve the sentence for the previous offense while charges on the new offense are pending, the credit given for presentence confinement under this section shall be granted against the sentence the defendant is currently serving for the previous offense and shall not be granted against the sentence for the new offense.
The question before the court of appeals was whether that sentence applies to misdemeanor cases.
Carrillo was arrested while on parole for another offense. Carrillo could not post bond on the charges and remained in jail for 274 days until he pled guilty to misdemeanor unlawful sexual contact. The court sentenced Carrillo to one year in county jail. The court granted Carrillo presentence confinement credit only for 19 days, the time remaining after he finished serving his parole sentence. Carrillo argued that, under section 18-1.3-509, C.R.S., he was entitled to presentence confinement credit for all of the time he was in jail.
The Court of Appeals affirmed the trial court's decision finding that the additional sentence in section 18-1.3-405, C.R.S., applies to misdemeanor sentences. The court found that applying the last sentence of section 18-1.3-405, C.R.S., to misdemeanor cases was necessary to construe similar statutes in the same way and to give effect to both statutes. (For more information, contact Michael Dohr.)
Holding: Rule 9011 of the Federal Rules of Bankruptcy Procedure preempts section 13-17-102, C.R.S.
Case Summary: In a federal bankruptcy proceeding, the debtors Steven and Melody Johnson requested an award of attorney fees under section 13-17-102, C.R.S., based on plaintiff Advanced Coatings, International, Inc.'s assertion and continued prosecution of allegedly groundless claims against the debtors.
The bankruptcy court concluded that section 13-17-102 is preempted by rule 9011 of the Federal Rules of Bankruptcy Procedure for two reasons. First, there is more than a mere superficial similarity between section 13-17-102 and Fed. R. Bankr. P. 9011. The statute and the rule target the same persons (litigants and attorneys in civil actions) and the same conduct (claims or defenses not grounded in law or evidence). Second, the two provisions cannot operate side by side without conflict. The rule contains a "safe harbor" requirement, which is strictly applied in federal court. The rule requires presenting an alleged violator with a separate motion asserting the rule 9011 violation and then waiting 21 days before filing the motion to allow the alleged violator to withdraw the challenged paper, claim, or defense. Failing to comply with this rule results in the rejection of a motion for sanctions.
Section 13-17-102, on the other hand, contains no such requirement. It only requires the court to hold a hearing and make specific findings. For these reasons, Fed. R. Bankr. P. 9011 preempts section 13-17-102. (For more information, contact Michele Brown.)
Case Summary: Section 1-40-106 (4) (a), C.R.S., requires both of the designated representatives of the proponents of a proposed initiative to appear at any title board meeting at which the title board considers the proposed initiative. The title board nonetheless set titles for five initiatives at rehearings even though fewer than both of the designated representatives of the proponents of the initiatives were present. The title board reasoned that because it had already set titles at the original hearings on the initiatives and there was no applicable remedy for the designated representatives' failure to appear, section 1-40-106 (4) (a), C.R.S., did not deprive the board of authority to set a title at the rehearings. The opponents of the proposed initiatives appealed, arguing that a rehearing is a "meeting" for purposes of section 1-40-106 (4) (a),C.R.S., and that the designated representatives' failure to appear at the rehearings therefore deprived the title board of authority to set titles for the proposed initiatives.
The Colorado Supreme Court held that: (1) Section 1-40-106 (4) (a), C.R.S., clearly and unambiguously requires both of the designated representatives of the proponents of a proposed initiative to appear at any title board meeting at which the title board considers the proposed initiative; (2) Because the title setting process is not complete until the title board has resolved a timely motion for rehearing, a rehearing is a "meeting" for purposes of section 1-40-106 (4) (a), C.R.S.; and (3) The failure of one or both of the designated representatives to appear at a rehearing therefore deprives the title board of authority to set a title for the initiative. Instead of setting a title, the title board may defer consideration of the challenges raised in the motion for a rehearing to the next meeting at which both designated representatives are present. The Court also determined that, because House Bill 11-1072 expanded the role of a designated representative from being merely an individual to whom notice is sent to being the representative of the proponents of a proposed initiative "in all matters affecting the petition," current statutory requirements concerning designated representatives are no longer mere procedural requirements, as the Court had held before the passage of House Bill 11-1072, but are instead substantive requirements. (For more information, contact Jason Gelender.)
Holding: An amendment to a special license plate statute, expanding eligibility beyond the membership of the sponsoring organization, violated the contract clauses of the state and federal constitution.
Case Summary: The department of revenue entered into a contract with the Raptor Education Foundation (REF) for issuance of special license plates only to REF members. A dispute ensued over who should be eligible to receive the plates, which dispute was settled by the court ordering the department to issue the plates only to REF members. In 2009, the General Assembly amended the statute to direct the department to issue the plates not only to REF members but also to members of the Rocky Mountain Raptor Program. REF sued and won on the basis that the legislation unconstitutionally deprived it of vested contractual rights. (For more information, contact Duane Gall.)
Case Summary: The deceased died in 1996. In 2001, the surviving spouse chose to take an elective share in lieu of the life estate left her in the will. The value of the elective share and other issues were litigated until, in 2009, the personal representative submitted his final petition with compensation request. The court allowed for an "equitable adjustment" to the spouse's elective share to address the increase in the estate value between death and distribution (approx. $24 million). The Probate Code has provisions to protect a beneficiary from decreases in value between death and distribution, and the corollary is that the same constant should hold for any increases in value between death and distribution. The court held that the existing Probate Code provides a precise and detailed mechanism for calculating the elective share, without regard to increases or decreases in the estate's value during administration. (For more information, contact Jane Ritter.)
Holding: The successful completion of a deferred judgment for DUI, which is explicitly excluded from the definition of a "conviction" under the DUI statutes, is nonetheless a "conviction" for purposes of the record sealing statute that generally allows only arrest and criminal records that do not relate to "convictions" to be sealed and specifically prohibits the sealing of records relating to a DUI conviction, and the records relating to such a deferred judgment therefore may not be sealed.
Case Summary: Paige Harte sought to have records of her DUI case sealed under section 24-72-308, C.R.S. (the record sealing statute), which generally allows criminal records to be sealed "in any case which was completely dismissed" and specifically prohibits sealing of records relating to a "conviction" for DUI, a sexual offense, or certain other types of offenses. The trial court dismissed the underlying DUI case after Ms. Harte successfully completed a deferred judgment, but denied her request to seal the case records on the ground that for purposes of the record sealing statute "entry of a guilty plea . . . even pursuant to a stipulation for a deferred judgment, constitutes a conviction and precludes sealing." Ms. Harte appealed the denial of the request to seal the records, and the Colorado Court of Appeals affirmed.
The DUI statute states that "a person ... [is] not ... convicted if the person has successfully completed a deferred adjudication." But the Court of Appeals, noting that the term "conviction" is defined differently for purposes of different statutes, held that the definition of "conviction" in the DUI statute, which excludes a successfully completed deferred judgment, did not apply to the sealing statute, that a successfully completed deferred judgment for DUI is a "conviction" for purposes of that statute, and that the records of Ms. Harte's successfully complted deferred judgment for DUI therefore could not be sealed. The Court examined the legislative history of the record sealing statute and found that the General Assembly "had determined in the [record] sealing statute that . . . the public’s safety interest in having available an offender’s alcohol-related driving record outweighs any privacy interest of that offender." The Court also relied on an earlier case in which the Colorado Supreme Court had interpreted the term "conviction" as used in a provison of the record sealing statute that prohibits sealing of records relating to a "conviction" of a sexual offense as including a succesfully completed deferred judgment for such an offense.
In a dissenting opinion, Judge Webb noted that the case was distinguishable from the sexual offense case relied upon by the Court because there was no statutory definition of a "conviction" under the sexual assault statute and concluded that the rules of statutory construction under which more recent enactments prevail over earlier ones, specific statutes prevail over general statutes, statutory exceptions are to be narrowly construed, and that all statutory provisions should given effect when possible weighed against the Court's opinion. (For more information, contact Duane Gall.)
Case Summary: In response to a significant decrease in PERA's funding level, the General Assembly enacted Senate Bill 10-001, which changed the formula for calculating the COLA for PERA retirees in a manner that reduced the COLA for many PERA retirees. Several PERA retirees filed a lawsuit in Denver District Court, alleging that the provisions of the bill that reduced their COLA violated the Contract Clause of the Colorado constitution and the Contract, Due Process, and Takings Clauses of the United States constitution. The retirees filed a motion for partial summary judgment on the state Contract Clause claim, and PERA filed a motion for summary judgment, arguing that: (1) The retirees had no right to an unchangeable COLA; (2) Even if they had such a right, the changes to the COLA in Senate Bill 10-001 did not substantially impair that right; and (3) The changes to the COLA were reasonable and necessary to serve a legitimate public purpose. The District Court granted PERA's motion for summary judgment, holding that the retirees did not have a contractual right to the specific COLA formula in place when they retired and that they therefore also did not have the property right to that specific COLA needed to support their federal Due Process or Takings claims. Because the District Court ruled in PERA's favor on the contractual right issue, it did not consider whether the changes to the COLA formula made in Senate Bill 10-001 substantially impaired a contractual right or were reasonable and necessary to serve a legitimate public purpose. The retirees appealed.
The Colorado Court of Appeals reversed the District Court's grant of summary judgment, holding that the retirees did have a contractual right to have their retirement benefits calculated using the COLA formula in effect when they retired. But the Court did not grant the retirees summary judgment on the Contract Clause claim. Instead the Court of Appeals remanded the case, instructing the District Court to determine whether or not the changes to the COLA in Senate Bill 10-001: (1) Substantially impaired the retirees' contractual right; or (2) Were reasonable and necessary to serve a legitimate public public purpose. (For more information, contact Nicole Myers.)
Colo. Dept. of Pub. Health & Env. v. United States, United States Court of Appeals for the Tenth Circuit No. 09-1554 (September 5, 2012)
Case Summary: United States Court of Appeals for the Tenth Circuit (affirming the United States District Court for the District of Colorado's decision to dismiss Colorado's claims against the United States).
Since the 1950s, the United States has stored chemical weapons at the Army's weapons depot located near Pueblo. Afer extending the deadline a number of times, Congress has mandated that the Army destroy those weapons by December 31, 2017. Separately, Congress authorized Colorado to regulate hazardous waste in the state. Invoking that authority, the Colorado Department of Public Health and Environment, Hazardous Materials and Waste Management Division, declared the chemical weapons stored at the depot awaiting destruction to be hazardous waste. In this action, Colorado sought to enforce against the depot Colorado's regulation prohibiting storage of any hazardous waste.
The court concluded that federal law, 50 U.S.C. §§ 1512a and 1521, preempts Colorado's attempt to regulate the destruction process by enforcing its prohibition on the storage of hazardous waste in 6 Colo. Code Regs. 1007-3, § 268.50 against the depot. The United States cannot comply with the state regulation prohibiting the storage of hazardous waste and also comply with the mandate of Congress on how and when the chemical weapons can be destroyed. (For more information, contact Michele Brown.)
Case Summary: This is a case of note because it addresses whether an administrative rule promulgated by the Secretary of State (Secretary) in the area of campaign finance is in conflict with state constitutional requirements. The rule has also attracted significant interest among members of the General Assembly who follow election matters. Under section 2 (10) (a) of Article XXVIII of the state constitution, an issue committee, the name given to an entity that supports or opposes ballot issues or ballot questions, must register with the Secretary and file public disclosure reports when it accepts or makes contributions or expenditures in excess of $200 to support or oppose any ballot issue or ballot question. In Sampson v. Buescher, 625 P.3d 1247 (10th Cir. 2010), the Tenth Circuit Court of Appeals held that the $200 threshold unconstitutionally burdened the First Amendment rights of association when applied to a small group of private citizens who had opposed a local annexation petition. However, the Tenth Circuit declined to draw a bright line below which an issue committee would not be required to report contributions and expenditures.
The Secretary promulgated a rule, Rule 4.27, to resolve uncertainty about registration and disclosure requirements resulting from the Sampson case. Rule 4.27 modified the requirements of section 2 (1) (a) of Article XXVIII by changing the threshold for reporting contributions and expenditures by issue committees from $200 to $5,000. The rule further stated that contributions received and expenditures made before reaching the $5,000 threshold are not required to be reported. Plaintiffs Colorado Common Cause and Colorado Ethics Watch brought an action challenging the legality of Rule 4.27. The trial court held that the Secretary had exceeded his rulemaking authority by promulgating Rule 4.27.
On appeal, the Court of Appeals concluded that Rule 4.27 effectively modified and contravened Colorado campaign finance law by eliminating certain requirements of Article XXVIII and the Fair Campaign Practices Act. The Court rejected the Secretary's argument that Sampson created a gap in the law that obliged him to promulgate a rule. Instead, the Court of Appeals concluded that Rule 4.27 exceeded the Scretary's authority because it rendered all of the registration and disclosure requirements completely inoperative for all issue committees prior to reaching the $5,000 threshold even though Sampson rendered the requirements inoperative only in cases with similar factual circumstances to those of the Sampson plaintiffs. Because Rule 4.27 invalidated the requirements imposed on issue committees far beyond what Sampson required, the Secretary exceeded his lawful authority in promulgating the Rule 4.27 and the Court declared the rule void. (For more information, contact Bob Lackner.)
Colo. Off-Hwy. Vehicle Coal. v. Colo. Parks & Wildlife Bd., Colorado Court of Appeals No. 11CA1988 (August 30, 2012)
Case Summary: In a case construing the open meetings law that is of significant policy interest to state and local public bodies, the Court of Appeals held that a public body may cure a previous violation of the Open Meetings Law. The Colorado Off-highway Vehicle Coalition (Coalition) sent the Board of Parks and Outdoor Recreation (Board), letters alleging that the Board had violated the Open Meetings Law by excluding the public from three closed meetings at which the Board had discussed proposed changes to the off-highway vehicle program (Program). After receiving the letters, the board held a regularly scheduled meeting in compliance with the Open Meetings Law and took public comments on and unanimously approved the proposed changes.
After the meeting, the Coalition sued the Board, alleging that the changes to the program that it had adopted were invalid because the Board had initially discussed them in closed meetings that violated the Open Meetings Law. The Board admitted the violations, and the Coalition moved for summary judgment. In response, the Board argued that it had cured its Open Meetings Law violations by holding the subsequent regularly scheduled meeting. The trial court granted summary judgment to the Board, rejecting the Coalition's argument that the Board had no right to cure the violations and that the regularly scheduled meeting had been nothing more than an "orchestrated, unanimous rubber stamping" of decisions made at the prior closed meetings and holding that the Board could legally cure prior violations and had in fact done so.
The Court of Appeals affirmed the trial court's granting of summary judgment to the Board. The Court reasoned that because the purpose of the Open Meetings Law is to require open decision-making, not to permanently condemn a decision made in violation of the statute, a public body may cure a previous violation of the law by holding a subsequent complying meeting that is not a mere rubber stamping of an earlier decision. (For more information, contact Tom Morris.)
Case Summary: A citizen saw a car drive erratically and strike a highway sign. The citizen followed the car to a house and called the police. Deputy Ashby arrived and looked through the garage window. Seeing the damaged car, he pushed through an open door. He found a woman who said her boyfriend had come home and was acting strangely. She got her boyfriend, Hanson, and brought him to Ashby. Hanson appeared drunk and refused to take the test for blood alcohol. He was issued a notice of license revocation.
At the license-revocation hearing, Hanson subpoenaed Ashby who failed to appear. Hanson argued that Ashby's entering his home without a warrant violated the Fourth mendment, and therefore, the evidence should be suppressed. But Ashby's failure to appear made it difficult to make this case. The hearing officer quashed the subpoena and revoked the license based largely on Ashby's written report.
The judicial branch enforces certain constitutional provisions, including the Fourth Amendment's rule against entering a home without a warrant, by the exclusionary rule. If a peace officer violates a constitutional right, the court will exclude any evidence obtained because of the violation. In this case, the court held that the exclusionary rule does not apply to hearings to revoke a driver's license. The court held that an administrative hearing is remedial not criminal in nature. Therefore, evidence will not be excluded based upon a peace officer's warrantless entry of a home.
This is a case of note for two reasons: First, drunk driving enforcement is a matter of significant policy interest. Second, the case appears to overturn the holding in Peterson v. Tipton. See Peterson v. Tipton, 833 P.2d 830 (Colo. Ct. App. 1992). Although the Peterson case didn't deal specifically with the Fourth Amendment, the court held that evidence should be excluded for a constitutional violation. (For more information, contact Jery Payne.)
Colo. Oil & Gas Conservation Comm'n v. Grand Valley Citizens' Alliance, Colorado Supreme Court No. 10SC532 (June 25, 2012)
Case Summary: The Colorado Supreme Court held that section 34-60-108 (7), C.R.S., did not require the Colorado Oil and Gas Conservation Commission (commission) to hold a hearing on the petition of a citizens' group to oppose issuance of a drilling permit. The Supreme Court reversed the Court of Appeals, which had held that the section 34-60-108 (2) requirement that the commission hold a hearing on "any matter within the jurisdiction of the Commission", applied not only to commission rules, regulations, and orders, but also to drilling permit-related petitions. The Supreme Court held that a reference in section 34-60-108 (7) to a "rule, regulation, order, or amendment thereof," limits the section 34-60-108 (7) hearing requirement to those matters, that section 34-60-106 (1) (f), C.R.S. grants the commission broad rule making authority to make rules governing drilling permit issuance, and that commission rules that allow only "the operator, surface owner, or the relevant local government" to request a permit hearing apply to petitions for permit-related hearings.
Justice Hobbs dissented, noting that the commission itself added a provision allowing participation by a "local government" to its rules in 2003 for the express purpose of "provid[ing] an opportunity ... to obtain a hearing on significant issues related to public health, safety and welfare, including the environment." Because the expense of litigating these issues might make a local government unwilling to seek such a hearing, Justice Hobbs would read the rules more expansively, in keeping with the Commission's stated "basis and purpose" of the 2003 amendments, so that a citizens' group could challenge a drilling permit applicant's evidence and cross-examine its witnesses at a hearing. Given the conflicting interpretations of the Supreme Court majority and Justice Hobbs regarding the applicable statutes, the case raises significant issues that the General Assembly may wish to consider clarifying through legislation. (For more information, contact Duane Gall.)
Freedom from Religion Found., Inc. v. Hickenlooper, Colorado Court of Appeals No. 10CA2559 (May 10, 2012)
The Freedom from Religion Foundation, Inc. ("FFRF") and four Colorado citizens sued Governor John Hickenlooper claiming that six annual proclamations of a Colorado day of prayer issued by Governor Hickenlooper and former governors violate the preference clause of the Colorado Constitution, Art. II, Sec. 4, which states that preference may not be given in law to any religious denomination or mode of worship. This section is Colorado's equivalent of the United States Constitution's first amendment establishment clause. The Colorado Court of Appeals found in favor of FFRF and the four Colorado citizens, holding that the proclamations issued from 2004 to 2009 are governmental conduct that violates the preference clause. According to the court, under the Lemon test established by the United States Supreme Court, the predominant purpose of these proclamations is to advance religion and they thus constitute preferential treatment to religion in general. Also, looking through the eyes of a reasonable observer, the proclamations have the primary effect of promoting religion because they send the unequivocal message that the governor endorses the religious expressions embodied therein, thus promoting religion over nonreligion.
The governor argued that, since the United States Supreme Court has approved legislative prayer in Marsh v. Chambers, the Colorado Court of Appeals should similarly find that the proclamations for a Colorado day of prayer are constitutional. But the Colorado Court of Appeals held that legislative prayer and the proclamations at issue in this case are distinguishable from Marsh. The court held that the proclamations, unlike legislative prayer, are not a well-established part of Colorado's history, have a greater scope because they are addressed to the public generally, and have a different effect because they "encourage citizens to 'unite' with those who believe in God and pray to God for the benefit of our country, our state, our leaders, and our people."
The case is remanded to the trial court to conduct additional proceedings in order to determine whether a permanent injunction should be issued to enjoin Governor Hickenlooper and his successors from issuing similar proclamations. (For more information, contact Esther van Mourik.)
Over a three-day period, C.F., a minor, called three schools, leaving messages at each stating that "tomorrow morning, the ... school will be blown up," "tomorrow ... the school you know as CCV will be blown to s---," and "I will bomb the s--- out of your school". C.F. was charged with falsely reporting an explosive, weapon, or harmful substance under section 18-8-110, C.R.S., and interfering with the staff, faculty, or students of an educational institution under section 18-9-109 (2), C.R.S.
The trial court acquitted C.F. on both charges, finding that the district attorney failed to prove all of the elements. The district attorney appealed the trial court's decision.
On the first count, falsely reporting an explosive, weapon, or harmful substance under section 18-8-110, C.R.S., the defense argued that the statute requires an actor to expressly state that at the time of the report "a bomb ... has been placed in any public or private place...". The court of appeals agreed, writing that, while the defendant clearly stated that the schools would "be blown up" at a certain time, the statute requires a specific report of the current placement of a bomb. The court of appeals further found that the defendant's statements did not, in themselves, support a reasonable inference that bombs at been placed somewhere at the time of the reports.
On the second count, interfering with the staff, faculty, or students of an educational institution under section 18-9-109, C.R.S., the court of appeals found that the clause "on or near the premises or facilities of any educational institution", as used in subsections (1) and (2) of that section, refer to the location of the actor who interferes with the staff, faculty, or students as well as to the location of the staff, faculty, and students. The court of appeals found that the statute does not apply if the actor interferes with the staff, faculty, or students while the actor is at a different location, as was the case with C.F.'s phoned-in bomb threat. (For more information, contact Joel Moore.)
At the request of the Arizona Supreme Court, The Chief Justice of the Colorado Supreme Court appointed the Colorado Office of Attorney Regulation Counsel (regulation counsel) to investigate allegations of misconduct by the former Maricopa County, Arizona attorney and two of his deputy county attorneys. Judicial Watch, Inc. made a "Colorado Open Records Act" (CORA) request of regulation counsel for certain records relating to the legal authority for the appointment of regulation counsel and payments made by or to regulation counsel in connection with the investigation. The Denver District Court ordered regulation counsel to release some, but not all, of the records requested, and regulation counsel appealed.
On appeal, the Court of Appeals held that regulation counsel are part of the judicial branch of state government because they are part of a process of attorney regulation that falls within the powers and duties of the judicial branch. Accordingly, following Colorado Supreme Court precedent holding that the judicial branch is neither the state nor a state agency for purposes of CORA, the Court of Appeals held that regulatory counsel records are not public records for purposes of CORA. (For more information, contact Jason Gelender.)
Associated Gov'ts of Nw. Colo. v. Colo. Pub. Utils. Comm'n, Colorado Supreme Court No. 11SA224 (April 23, 2012)
In a case involving judicial review of a decision by the PUC, the Colorado Supreme Court held that the filing of the action in Routt County, in which venue was not proper, was a procedural defect for which the proper remedy was a transfer to another county, rather than a jurisdictional defect for which the proper remedy was dismissal. The court carefully parsed the statutory language and legislative history, including the headnote to the section, and compared the phrasing of different statutes requiring specific types of actions to be "commenced," "commenced and tried," "brought", etc., in a particular court to determine whether the place-based forum requirements of these statutes were jurisdictional or not. The decision was split 4-2, with a dissent by Justice Rice in which the Chief Justice joined.
This is a case of note because the statute at issue is ambiguous, and in resolving the ambiguity in this statute the Court relied on conventions of construction that may or may not comport with the General Assembly's intent in enacting this statute or the other statutes that the Court examined in the course of the opinion. Specifically, the statute at issue here (§40-6-115, C.R.S.) could have been--and, according to the dissenting opinion should have been--interpreted to make filing in the proper county a jurisdictional requirement because subsection (1) of the statute grants a party the right to seek review in "the district court", and subsection (5) then specifies that the action "shall be commenced and tried in the district court in and for the county in which the petitioner resides, ... or in the district court of the city and county of Denver, ... " However, the majority opinion held that subsection (1) contained the only jurisdictional requirement (i.e., that the case be filed in a "district court") and that subsection (5) did not "supplement the jurisdictional requirements of subsection (1)" but rather "act[ed] as a freestanding venue requirement." 2012 CO 28, para. 13.
This distinction matters because, in this case, it gave the petitioner an extra bite at the apple; presumably the 30-day period for seeking judicial review would have run and the petitioner would have been without a remedy if the Supreme Court had ordered the Routt County District Court to dismiss the case on jurisdictional grounds. If the General Assembly desires to preclude this result, it should amend §40-6-115. And if the General Assembly desires to provide similar opportunities to cure erroneously filed petitions for judicial review under other statutes, it should amend those statutes to make clear that the place-of-filing provisions are intended only to define the proper venue, not to limit the jurisdiction of a district court to accept (and then transfer) a case that was filed in the wrong county. (For more information, contact Duane Gall.)
After the general assembly failed to enact a bill to redistrict the state's congressional districts as required by the U.S. constitution and Article V, section 44 of the state constitution, two sets of plaintiffs sued the secretary of state in Denver district court, alleging that the existing congressional districts no longer satisfied federal constitutional and statutory equal population requirements and could not be used for the 2012 election. Both sets of plaintiffs also submitted maps of proposed congressional redistricting plans. The Denver district court agreed with the plaintiffs' allegations regarding the unconstitutionality of the existing districts and entered an order adopting a proposed "Moreno/South" map submitted by one of the sets of plaintiffs. The supreme court issued a writ of certiorari to hear the appeal directly without an intermediate appeal to the Colorado Court of Appeals and affirmed the trial court's decision.
Preliminarily, the Supreme Court concluded that neither of the constitutional requirements of equal population and compliance with the federal "Voting Rights Act" were at issue because no appealing party alleged that the Moreno/South map violated those requirements. The supreme court held that: (1) each of the statutory factors that a court may consider must be interpreted in light of the foundational goal of congressional redistricting under the United States constitution: fair and effective representation for all citizens; (2) the minimization of disruption of existing boundary lines, which the appellants emphasized, is only one among many factors that the court must balance; (3) the applicable statute, section 2-1-102, C.R.S., gives the trial court broad discretion in striking this balance; (4) the consideration of competitiveness is consistent with the ultimate goal of maximizing fair and effective representation; and (5) the trial court's adoption of the Moreno/South map reasonably balanced these many factors, was supported by the evidence, and therefore was not an abuse of discretion.
The Supreme Court then examined each of the proposed congressional districts in the Moreno/South map. Specifically, the incorporation of several of Denver's southern suburbs into the first district was reasonable, both because they share a community of interest and because incorporating suburbs elsewhere would have required splitting municipal boundaries. Current communities of interest, including the I-70 corridor, Rocky Mountain national park, the beetle-kill forest infestation, and higher education and its associated health and high-tech industries, justifies the court's adoption of the second district, while the community of interest for this district from 10 years ago, the cleanup of Rocky Flats, is no longer relevant. The third district minimizes disruption of the existing district lines, thus maintaining communities of interest that remain important today.
The addition of rural Douglas, Arapahoe, and Adams counties into the fourth district, in part to compensate for the transfer of Larimer county into the second district, is supported by those areas' community of interest in agriculture and drought, and it was appropriate for the court to look to the near future in identifying pending oil and gas development in these areas as a community of interest. The fifth district is largely unchanged other than the removal of Lake county, as necessitated by the requirement of population equality.
The sixth district puts Aurora in a single district, unites the newer and fast-developing suburbs from northeast of Denver to southwest of Denver, and properly creates a competitive district. Similarly, the seventh district becomes more compact by including the older suburbs from north of Denver through Jefferson county, which share a community of interest in clean energy and replacing aging infrastructure. The seventh district also includes a significant Latino community of interest and properly creates a competitive district. (For more information, contact Tom Morris.)
Colo. Ethics Watch v. Senate Majority Fund, LLC, Colorado Supreme Court No. 10SC276 (February 21, 2012)
The Colorado Supreme Court considered whether state campaign finance law required two "527" tax-exempt political organizations, the Senate Majority Fund ("SMF") and the Colorado Leadership Fund ("CLF"), to register as, and comply with all laws and administrative rules governing, political committees and held that SMF and CLF were not political committees. SMF's stated purpose was "supporting candidates for the state senate," and CLF's stated purpose was "electing Republicans". Before the November 2008, general election, SMF and CLF paid for and distributed sixteen printed ads and one television ad. Article XXVIII of the state constitution requires a political organization that makes an expenditure "for the purpose of expressly advocating the election or defeat of a candidate" for public office to register as a political committee,
Colorado Ethics Watch ("CEW") sued SMF and CLF, claiming that the ads constituted express advocacy and that SMF and CLF had therefore violated article XXVIII of the state constitution by failing to register as, and comply with the laws and rules that govern, political committees. SMF and CLF moved to dismiss the complaint, arguing that they were not political committees because the ads did not constitute "express advocacy" An administrative law judge ruled that neither organization was a political committee and dismissed the complaint, the Court of Appeals affirmed the dismissal, and CEW appealed.
The Supreme Court's analysis centered on whether any of the ads at issue constituted "express advocacy" for purposes of article XXVIII. Section 2 (8) defines expenditure to mean a purchase, payment or related benefit made by any person for the purpose of "expressly advocating the election or defeat of a candidate". Relying on United States Supreme Court and Colorado precedent and the presumed intent of the voters in passing article XXVIII, the Colorado Supreme Court held that "express advocacy" includes only speech that explicitly exhorts the viewer or reader to vote for or against a candidate in an upcoming election using so-called "magic words" (e.g., "vote for", "elect", "defeat", "reject") described by the United States Supreme Court or substantially similar synonyms. The Supreme Court also rejected a functional equivalence test for "express advocacy" proposed by CEW on the grounds that it would be difficult to apply, could unconstitutionally chill protected political speech, and was not consistent with Colorado voters' intent in approving article XXVIII. The Supreme Court concluded that because none of the ads at issue contained any of the "magic words" or substantially similar synonyms, they did not constitute "express advocacy", SMF and CLF were not political committees, and it was proper to dismiss CEW's complaint against the organizations for failure to state a claim upon which relief could be granted. (For more information, contact Bob Lackner.)
In this case, the Court of Appeals found two statutes in conflict. In addition, the decision appears to be a landmark decision for Colorado and the subject matter is of significant policy interest.
In 2009, the General Assembly passed legislation authorizing a voter personally to return a mail-in ballot to any polling place in the county in which the voter is registered to vote ("Mail-in Ballot Statute"). An effect of the legislation was to require Arapahoe County ("County") to make available 197 additional locations for drop off mail-in ballots during the 2010 general election at an alleged cost of $80,000. The County notified the Secretary of State ("State") that, because the General Assembly had not appropriated additional funding to cover the county's increased cost, it would not provide the additional drop-off boxes pursuant to a state statute requiring any new state mandate or increase in the level of service for an existing state mandate that is not accompanied by a reimbursement to cover local governments' costs to be optional on the part of the local government ("Unfunded Mandate Statute"). The State then sued the County, seeking a preliminary injunction requiring the county to enable the delivery of mail-in ballots on election day to every polling place. The trial court granted the preliminary injunction.
The Court of Appeals affirmed the decision of the trial court and held that the Mail-in Ballot Statute requires a county to bear the costs of providing drop-off boxes for mail-in ballots at every polling place. The court concluded that the Mail-In Ballot and Unfunded Mandate Statutes are in irreconcilable conflict and that the Mail-In Ballot Statute, which pertains only to election funding, is more specific than the Unfunded Mandate Statute, which broadly applies to most existing state programs. Although the Unfunded Mandate Statute was adopted after the Mail-In Ballot statute, there was no manifest legislative intent that the Unfunded Mandate Statute should prevail in a conflict with the Mail-in Ballot Statute. Rather, the intent of the legislature was to prioritize citizens' access to free and fair elections over convenience or cost savings to counties. Accordingly, the trial court correctly determined that counties must provide drop-off boxes for mail-in ballots at every polling place on election day, notwithstanding that this increase in service may create additional costs to the county. (For more information, contact Bob Lackner.)
The defendant was convicted of ten counts of sexual assault by one in a position of trust as part of a pattern of abuse and other related offenses. The court imposed ten ten-year consecutive sentences on the "pattern of abuse" convictions. The defendant appealed arguing that he could not be convicted of more than one "pattern of abuse" offense. The Court of Appeals agreed finding that the multiple "pattern of abuse" convictions violated double jeopardy. The Supreme Court heard this case and a companion case in which a different panel of the Court of Appeals reached the opposite conclusion. The question before the Supreme Court was whether "pattern of abuse" is a separate offense or a provision that enhances the sentence.
The Supreme Court reversed the Court of Appeals finding that the "pattern of abuse" provision is not a separate offense. Rather, it allows each incident to be elevated from a class 4 felony to a class 3 felony. The Supreme Court noted that the definition of "pattern of sexual abuse" does not establish a separate offense; the unit of prosecution remains the substantive crime. Rather, the plain language of the statute authorizes greater punishment for the substantive crime, in this case, sexual assault on a child by one in a position of trust.
The Supreme Court went on to find that the "pattern of abuse" provision does not violate the double jeopardy protection against multiple punishments. The Court stated that separate convictions and punishments authorized by the legislature never violate double jeopardy. In the "pattern of abuse" provision, the General Assembly intended to authorize separate convictions for each incident of sexual assault on a child by one in a position of trust and authorized enhanced punishment of each assault that is committed as part of a "pattern of sexual abuse". (For more information, contact Michael Dohr.)
Defendant was convicted of failure to register as a sex offender. Defendant registered his mother's home as his home address on his annual sex offender registration form. When a law enforcement officer attempted to verify the registration address, the deputy found the home vacant. As a result, the defendant was charged with two counts of failure to register as a sex offender and two counts of failure to register as a sex offender, second offense.
At trial, defendant testified he moved out of the home, because it was foreclosed on, and then stayed with various friends and in his car. He stated he did not change or cancel his registration because he did not have a new address. He denied that he stayed in another county after moving out of his mother's home.
In a trial to the court, the court found the defendant guilty of failure to register based on the fact that he failed to complete a cancellation form in the county in which he no longer resided. The defendant appealed his conviction to the Court of Appeals. The Court of Appeals vacated the conviction because section 18-3-412.5 (1) (i), C.R.S., requires that the prosecution prove that the defendant moved away from the county of his or her last registration. The prosecution presented no evidence at trial that defendant, who was homeless, had moved out of the county.
The Court of Appeals in a footnote, noted that the statute does not indicate what a homeless or transient person should do to continue his or her registration or to comply with the registration requirements. The Court of Appeals pointed out that other states have amended their registration statutes to address the situation of a homeless person who is required to register as a sex offender. The Colorado statute does not address this situation. (For more information, contact Michael Dohr.)
As required by Article V, Section 48 of the state constitution, the Supreme Court reviewed and considered objections to the finalized Reapportionment Plan for Colorado General Assembly House and Senate districts adopted by the Colorado Reapportionment Commission. The various objectors to the Plan generally argued that the Plan violated Article V, Section 47 (2) of the state constitution because it did not give sufficient attention to preservation of county boundaries or minimize the splitting of the City of Colorado Springs into multiple districts. The Court agreed with the objectors and held that the Plan was not sufficiently attentive to county boundaries and that the Commission had not made an adequate showing that a less drastic alternative could not have satisfied the equal population requirement of Article V, Section 46 of the state constitution. The Court directed the Commission to submit a new House and Senate district Plan to it by December 6, 2011. (For more information, contact Jason Gelender.)
The Colorado republican party ("CRP") sued several democratic state representatives ("representatives") under section 24-72-204 (5), C.R.S., of the "Colorado Open Records Act" for recovery of attorney fees and costs on the ground that the public records custodian had improperly withheld inspection of public records. The Court of Appeals held that a party who brings an action against a public records custodian to inspect public records under section 24-72-204 (5), C.R.S., and obtains any improperly withheld public record as a result of the action is a prevailing applicant who must be awarded court costs and reasonable attorney fees unless another statute prohibits such an award. The court also held that section 24-72-204 (6), C.R.S., which prohibits an award of attorney fees under section 24-72-204 (5), C.R.S., if the public records custodian proves that, after exercising reasonable diligence and making reasonable inquiry, he or she was unable to determine whether public records needed to be disclosed, did not apply given the facts of the case. Accordingly, because the CRP succeeded in obtaining the right to inspect documents it sought from the representatives and no statute otherwise barred an attorney fees award, the court held the CRP to be a prevailing applicant entitled to an award of court fees and reasonable attorney fees and remanded the case to the district court for a determination of the amounts of costs and attorney fees to be awarded. (For more information, contact Bob Lackner.)
The Court reversed the trial court's order that the defendant, Wal-mart, be granted a new trial based on violation of rules of discovery and disclosure.
In 2007, Holly Averyt, a commercial truck driver, was delivering goods to the Wal-mart store in Greeley, Colorado, when she slipped on a grease spill and fell. The injuries sustained by Ms. Averyt required multiple surgeries and caused long-term physical and mental health issues. As a result, Ms. Averyt was no longer able to work and lost her truck. She sued Wal-mart for damages.
At trial, during Wal-mart's opening statement, the store denied any existence of a grease spill at the time of Ms. Averyt's fall. While those statements were taking place, Ms. Averyt's attorneys obtained a memo from the county ("Greeley Report") documenting that a grease spill had in fact occurred. The information in the Greeley Report was used by Ms. Averyt's attorneys to question the spokeswoman for Wal-mart the following day and impeach her testimony. Wal-Mart asked Ms. Averyt's attorneys if the information used during questioning had come from a document, at which point Ms. Averyt's attorneys shared the Greeley Report. The Report was entered into evidence and the following day Wal-Mart changed the strategy of their case to admit to the existence of the spill, but that they had taken the proper steps to clean it up before Ms. Averyt's fall.
The jury found Wal-mart at fault and awarded Ms. Averyt $15 million in damages (reduced to approximately $10 million due to Colorado's cap on non-economic damage awards). Wal-Mart appealed the ruling and requested a new trial, citing that Ms. Averyt's attorneys violated disclosure rules outlined in C.R.C.P. 26 (a) (1) and 26 (e) when they did not disclose the Greeley Report in a timely manner after it was discovered. Wal-mart was awarded a new trial, but that decision was reversed by the Colorado Supreme Court. The court found that a party does not need to automatically disclose public documents that are equally available to all parties. Because the Greeley Report was a public document, it was not necessary for the Averyt attorneys to automatically disclose the Report to the Wal-Mart attorneys. In addition, the Supreme Court held that enough evidence was presented to support the jury's verdict and the award for damages was sustained. The $15 million award is the largest slip-and-fall judgment in the United States to date. (For more information, contact Cara Meeker.)
Plaintiffs filed a class action lawsuit alleging that defendant's removal of an oil pipeline had contaminated their properties with asbestos. Pursuant to Colorado Rule of Civil Procedure (CRCP) 23, the trial court certified two classes of property owners. The Court of Appeals reversed the trial court's class certifications, holding that a trial court must apply the preponderance of evidence (more likely than not) standard to each CRCP 23 requirement and that the trial court had abused its discretion by certifying the classes on the lesser basis of "some evidence" or "some reasonable evidence". The Court of Appeals also held that a trial court must resolve factual or legal disputes relevant to class certification, including disputes between expert witnesses, regardless of any overlap with the merits of the class's claims.
The Supreme Court reversed the Court of Appeals, holding that CRCP 23 is a trial court case management tool, that neither CRCP 23 nor Colorado case law impose a specific burden of proof on a trial court's class certification decisions, and that a trial court must instead rigorously analyze the evidence and determine to its satisfaction whether the party seeking class certfication has satisfied each CRCP 23 requirement. The Supreme Court also held that a trial court may consider factual or legal disputes, including expert witness disputes, to the extent necessary to determine that CRCP 23 requirements for class certification have been met, but may not resolve such disputes to screen out or prejudge the merits of a case. (For more information, contact Jason Gelender.)
Reversing the appellate court, the Supreme Court held that the trial court improperly granted the defense's motion to exclude the testimony of the guardian ad litem (GAL) as privileged pursuant to section 13-90-107(1)(b), C.R.S.
The stepfather was charged with 2 counts of sexual assault on a child by one in a position of trust for allegedly fondling and digitally penetrating his sixteen-year-old stepdaughter on approximately 15 occasions. In addition to the criminal charges, a dependency and neglect (D & N) petition was filed in juvenile court naming the mother as the respondent and the stepfather as a special respondent. As required pursuant to section 19-3-203, C.R.S., the court appointed a GAL for the stepdaughter in the D & N case.
Prior to the criminal trial, the stepdaughter recanted her accusations, and the prosecution gave notice of its intent to call the GAL and the social worker in the D & N case as witnesses. At the hearing on the defendant's motion to exclude this testimony, the prosecutor indicated that the GAL would testify that the stepdaughter stated it would make things easier for the stepdaughter if she admitted to lying about the sexual abuse and it would make her mother happy if she simply stated that the abuse never occurred. The trial court ruled that the GAL could not testify because Colorado Rule of Professional Conduct (CRPC) 1.6, in conjunction with Chief Justice Directive (CJD) 04-06 imposed a duty of confidentiality on the GAL which could only be waived by the stepdaughter. The trial court also ruled that the social worker could not testify concerning the mother's statements to the social worker concerning the mother's argument with the stepdaughter.
The Supreme Court held that the stepdaughter's statements to the GAL were not privileged because, even though the rules of ethics and the statutes on privilege prevent the disclosure of statements made in an attorney-client relationship, neither the rules nor the statute dictate whether an attorney-client relationship, neither the rules nor the statute dictate whether an attorney-client relationship exists. Although a GAL is an attorney, the statute is silent as to whether a GAL holds an attorney-client relationship with the protected child, and the relationship of a GAL to the protected child is one of guardianship rather than advocacy. The GAL is required by statute to assess and make recommendations to the court concerning the protected child's best interests, and the GAL does not hold an attorney-client relationship with the child. Therefore, the trial court erred in excluding the GAL's testimony.
The Supreme Court further found that the trial court erred in excluding testimony by a social worker concerning statements made by the stepdaughter. Section 19-3-207, C.R.S., the statute the trial court relied on in excluding the statements, prohibits a professional from testifying concerning statements made pursuant to compliance with court-ordered treatment. The Supreme Court held that the trial court erred in excluding the social worker's testimony without first determining whether the mother's statements were made pursuant to compliance with court-ordered treatment.
Finally, the Supreme Court held that the prosecution could appeal the trial court's ruling on the motion even though the prosecution had already moved to dismiss the charges without prejudice. Section 16-12-102, C.R.S., authorizes the prosecution to appeal decisions of trial courts in criminal cases concerning questions of law, but only if there is a final judgment in the case, as required in Colorado Appellate Rule (CAR) 1. Dismissal of the case constituted a final judgment for purposes of CAR 1 even though the prosecution may, at some point in the future, reinstate charges.
DISSENT: Justice Martinez dissented, Chief Justice Bender joining in the dissent. With respect to the attorney-client relationship, Justice Martinez argued that Colorado statutes are not silent on the issue, that under the majority opinion, without the protection of the attorney-client privilege, GAL's will be required to disclose information about their wards even when it is not in the best interests of the child to do so, and that the better outcome intended by the statutory scheme is to recognize the attorney-client privilege, but permit the GAL to decide whether to assert the privilege on behalf of the child. (For more information, contact Brita Darling.)
The Court of Appeals held that digital images of ballots are subject to the "Colorado Open Records Act" so long as the digital images do not reveal voters' identities.
Following its May 2009 mayoral election, the City of Aspen implemented a new computerized ballot tabulation system designed for instant runoff voting procedures. Part of the new tabulation system involved scanning the paper ballots from the election to create digital photographic images, which were then processed into data strings. The end result was a digital copy of each paper ballot that contained a record of the votes cast but in almost all cases contained no information that could identify the individual voter.
The plaintiff, Marilyn Marks, requested the release of the digital copies of ballots cast in the May 2009 City of Aspen mayoral election under the "Colorado Open Records Act" (CORA). The defendant, Kathryn Koch, the city clerk of Aspen, denied the CORA request based on the grounds that the release of the digital copies would violate the secrecy-in-voting requirement of Article VII, Section 8 of the state constitution.
The Court of Appeals held that the secrecy-in-voting requirement protects the identity of the voter, not the record of votes cast on the ballot. The court also held that the digital copies of ballots in this case are not themselves "ballots" for purposes of the state election laws and therefore are not exempt from release under CORA. The court ordered the release of all digital copies of ballot contents pursuant to the CORA request other than those few digital copies that contained content that could identify an individual voter. (For more information, contact Effie Ameen.)
Following a bar confrontation, the defendant, Vincent Palomo, was charged with criminal attempt to commit first degree murder, second degree assault (deadly weapon), vehicular eluding, and a crime of violence. At trial, he was convicted on the charges of vehicular eluding and the lesser, nonincluded charge of eluding or attempting to elude a police officer.
Pursuant to the provisions section 18-1.3-701 (7) (a), C.R.S., governing costs of prosecution, "Where any person...is convicted of an offense...the court shall give a judgment in favor of the state of Colorado, the appropriate prosecuting attorney, or the appropriate law enforcement agency and against the offender..for the amount of the costs of prosecution...".
Here, the prosecution's costs totalled $1,785.65, for travel, lodging, expert witnesses, and costs of subpoenas.
The defendant appealed, arguing that he is only liable for the costs actually incurred in the prosecution of the convicted charges. As the defendant was only convicted of vehicular eluding and eluding or attempting to elude a police officer, he argued, any costs relating to the prosecution of the murder and assault charges should be dismissed.
In considering the appeal, the Court of Appeals first considered the costs statute and found it ambiguous with regard to cases where the defendant is convicted on same, but not all, counts. The Court of Appeals writes that, "The statute is certainly capable of more than one reasonable interpretation when a defendant is charged in a multi-count indictment or consolidated cases, but convicted of fewer than all of the counts...In addition, the statute is silent on, and appears to not contemplate, the issue presented here."
The Court of Appeals therefore looks to the application of similar statues or rules in other jurisdictions, which hold that the costs incurred in an unsuccessful prosecution cannot be assessed against a defendant. Based on these holdings, the Court of Appeals reverses the order for costs and remands the case to the trial court to determine the amount of costs associated with the counts on which the defendant was convicted. (For more information, contact Joel Moore.)
The case arose out of the Fort Morgan City Council's use of anonymous written ballots for the purpose of filling two vacancies on the city council and appointing a municpal judge during public meetings in 2009 and 2010. Although the ballots were completed in the public meeting, and the results were announced at the meeting after the ballots were collected and tabulated, the written ballots did not identify the council member who cast each vote, nor was this identifying information otherwise available or recorded.
A resident of Fort Morgan filed a complaint alleging that the council members' use of anonymous written ballots violated the Colorado Open Meetings Law ("COML"), sections 24-6-401-402, C.R.S. This resident sought to invalidate the appointments and enjoin the city council from using such ballots in the future. The court of appeals affirmed an order of the trial court dismissing the complaint on the ground that the city council's voting procedure is not prohibited by the COML.
The court of appeals reasoned that the COML does not impose any specific voting procedures on local public bodies or prohibit the use of anonymous ballots. The COML is silent as to whether votes taken need to be recorded in a way that identifies which elected official voted for which candidate. Rather, the law requires only that the public have access to meetings of local public bodies and an opportunity to observe the decision-making process. The court declined the opportunity to read additional terms into or modify the plain terms of the statute, reasoning that expanding the requirement for open meetings to include a particular voting procedure at those meetings would amount to judicial legislation. (For more information, contact Bob Lackner.)
Pellman v. People, 252 P.3d 1122 (Colo. 2011). Colorado Supreme Court (Eid / 6-0) (The Supreme Court interprets significant term in criminal law statute). The Court affirmed the Court of Appeals' holding that the defendant, Pellman, was in a "position of trust" for purposes of sections 18-3-405.3 and 18-3-401 (3.5), C.R.S., at the time of the unlawful sexual contact.
The defendant, Pellman, age 44, initiated a romantic relationship with the victim, age 15. Pellman attended the church at which the victim's father was pastor, and Pellman and his wife were personal friends of the victim's parents, joining the victim's family for dinners, helping the victim and her sister with their school work, and, on several occasions, babysitting the victim and her sister while the parents were out of town. Pellman taught the victim's Sunday school class at the church from 2000 to 2003. Starting in May, 2005, Pellman initiated sexual contact with the victim, and over the next several weeks, the victim went to Pellman's house, with her parents' permission, between four and six times to ride horses. At the beginning of July, 2005, Pellman was a chaperone on a church field trip that included the victim. On the field trip, Pellman kissed the victim. During July and August, 2005, the victim met Pellman without her parents' knowledge three to four times per week, and Pellman engaged in unlawful sexual contact with the victim in the nature of fondling and inappropriate touching with and without clothing. At the end of August, 2005, the victim told her parents about the nature of her relationship with Pellman, and Pellman was arrested and convicted pursuant to section 18-3-405.3 (1), C.R.S., of sexual assault on a child victim aged fifteen to seventeen by a person in a position of trust, a class 4 felony.
Pellman appealed the conviction, arguing that, to be acting in a position of trust, a defendant must be performing a specific supervisory task at the time the unlawful sexual contact occurs. Specifically, he argued that he was only in a position of trust at a specific time, the last of which was when he chaperoned the church field trip at the beginning of July 2005, and section 18-3-401 (3.5), C.R.S., requires that a defendant be in a position of trust "at the time of the unlawful act".
The Colorado Supreme Court affirmed the Court of Appeals' holding that a defendant need not be performing a specific supervisory task at the time of the unlawful sexual contact in order to occupy a position of trust. Instead, a defendant may assume a position of trust through ongoing and continuous discrete acts of supervision of the victim. Pellman had assumed an ongoing and continuous supervisory role in relation to the victim in his capacity as a church youth volunteer and family friend, and the unlawful sexual contact occurred while Pellman occupied that role. As long at the unlawful sexual contact occurred while the supervisory relationship existed, the unlawful sexual contact occurred "at the time of the unlawful act" pursuant to section 18-3-401 (3.5), C.R.S. A position of trust for purposes of sections 18-3-405.3 and 18-3-401 (3.5), C.R.S., may be a supervisory position that exists for a brief period, a matter of hours or days, or it may extend over a long relationship. The Court reasoned that the General Assembly intended "position of trust" to be broadly interpreted and to apply to those instances in which a defendant has gained access to a child through the position of trust that he or she holds. (For more information, contactBrita Darling.)
People v. Griffin, 08CA2694 (Colo. App. 2011); Colorado Court of Appeals (The court of appeals finds a statute to be ambiguous and significantly reinterprets that statute.) The court held that a sex offender is not required to register in a location in which he or she has stated a mere intention to reside.
The defendant, Carey Andre Griffin, was convicted of failure to register as a sex offender under the Colorado Sex Offender Registration Act (Act), sections 16-22-101 to 16-22 -115, C.R.S. The Act requires an offender to notify the state of his or her intent to reside at a location and then to register as a sex offender at that location once he or she establishes a residence there. Section 16-22-102 (5.7), C.R.S., defines "residence" as "...a place or dwelling that is used, intended to be used, or usually used for habitation by a person who is required to register...". Further, section 16-22-105 (3), C.R.S., states that an offender "establishes a residence through an intent to make any place or dwelling his or her residence".
In 2006, Griffin cancelled his registration in Denver and gave notice to authorities that he intended to reside in Adams County. But, Griffin never moved to Adams County and so never registered as a sex offender there. In 2007, Griffin was arrested in another state and returned to Colorado, where he was convicted of failure to register as a sex offender. The prosecution argued Griffin was required to register in Adams County because he had stated his intent to reside there, even if he never physically resided there.
The Colorado Court of Appeals overturned Griffin's conviction, stating that "the phrase 'establish a residence' requires...a physical presence or occupancy". While the Act requires an offender to notify the state of his or her intent to reside at a location, it does not require the offender to register at this intended location until he or she actually makes it a residence. Further, the provisions of the Act provide no structure for enforcing the registration requirement against an offender at the location where he or she merely intends to reside. "...[W]e would expect such an unusual requirement to have been stated clearly and directly (instead of implicitly, by defining "establish a residence" in a manner that defies common understanding)." (For more information, contact Joel Moore.)