For a primer on the interplay between equity and law, read this case. It is a collection action on a promissory note that matured in 1999. The trial court held it was timely filed in 2009 under the partial payment doctrine. That doctrine says the statute of limitations for suing on a note, six years, begins anew upon each partial payment. The trial court also found all the elements of the equitable defense of laches were met, and barred the claims. The court of appeals reversed, holding laches is not available as an equitable defense to a timely filed action to recover a debt. The doctrine is not an equitable extension of the limitations period. Rather, courts merely interpret and apply the statute. Separation of powers concerns do not, under the facts presented, permit an equitable doctrine to shorten the legislative determination of the time within which an action can be brought.
The Colorado Supreme Court issued its Judgement and Opinion on January 13, 2014, REVERSING the Court of Appeals.
Interlocutory appeals under the new Appellate Rule 4.2 are hard to get, but this conservation easement tax credit appeal adds substance to the rule. Plaintiffs appealed a Dept. of Revenue disallowance of a tax credit to the trial court. The appeals court granted interlocutory review of the trial court’s order denying DOR relief. The court gave 4 reasons for granting interlocutory review under the “controlling issues of law” prong: 1) widespread public interest; 2) failure to join parties can be dispositive; 3) resolution would control the ultimate outcome; and 4) to avoid inconsistent results. The court will review the merits of 4 issues related to conservation easements: 1) who is a “taxpayer;” 2) who is liable for tax deficiencies; 3) are tax credit transferees necessary parties to a tax credit appeal; and 4) what are the service requirements on transferees.
In this case, attorneys clash over piercing the corporate veil. An LLC’s veil failed to shield a shareholder from being personally responsible for attorneys’ fees incurred in a veil-piercing lawsuit, following an arbitration award. Swinerton won an arbitration award against Beauvallon, an LLC owned by Nassi. Swinerton then brought a lawsuit to pierce Beauvallon’s veil to collect the arbitration award against Nassi. The trial court ruled for Swinerton, who then sought to recover attorneys’ fees incurred in the veil-piercing litigation, which the trial court denied. The Court of Appeals reversed, and held that when an LLC’s corporate veil is pierced, shareholders are liable for all the LLC’s contractual obligations. Therefore, Swinerton could enforce the contract’s attorney-fee shifting provision to recover fees against Nassi on the veil-piercing action.
Filed under Uncategorized