The “extensive edifice of the attorney regulation and discipline system” protects attorneys from breach of fiduciary duty claims from third parties. In this case, an attorney contracts with medical providers to provide his clients with medical care. In exchange, the providers take a medical lien on any settlement funds the attorney secures in payment for motor vehicle accident claims. The attorney puts his clients’ settlement funds into a COLTAF account and then pays providers from those funds. But the relationship turns “toxic,” and the attorney starts withholding payments. The providers claim the attorney breached a fiduciary duty. The Court holds that arms-length business transactions like this do not create a fiduciary relationship. Also, attorneys owe duties to their clients, not third party creditors of clients. Here, the providers could recover only what was owed.
Monthly Archives: June 2012
Teachers can get sent to the principal too. In this case a teacher is terminated for bad behavior and then commences the formal grievance process. He wins at step three but is unofficially informed that the Board of Education will terminate him anyway. He does not finish the grievance process and sues. The Board never makes a final decision. The court of appeals, in a split decision, holds that the trial court lacked subject matter jurisdiction for failure to exhaust administrative remedies. Exhaustion was not futile because it was not clear beyond a reasonable doubt that the Board would actually terminate him. The dissent views the collective bargaining agreement as a contractual relation; thus the teacher failed to exhaust contractual remedies, not administrative remedies, and under a contract analysis the claim should be allowed to proceed.
Free market competition has its limits; one is the bar on intentional interference with contractual relations. The line between tough competition and tortious behavior is not bright. The court of appeals clarified that line, sort of, by holding that an interference claim may lie even in the absence of an actual breach or impossibility of performance of a contract, depending upon the nature of the conduct of the alleged tortfeasor. This case involved the machinations of former employees to take the largest client of their prior employer by hiring away all the other employees. Relying on the Restatement of Torts, and interpreting a prior Supreme Court case as setting forth only some of the ways in which an interference claim could be proved, the court of appeals concluded that in this case, the plaintiff’s proof sufficiently showed defendant’s wrongful conduct caused interference.
Divorces can get pretty contentious, with everyone looking for an advantage. In this case, Father gets Mother’s employment file from an old employer by issuing a subpoena duces tecum under CRCP 45. It takes one hour to get the file, but three days to give Mother notice of the subpoena. Subpoenaed documents are often produced in advance, and the appearance of the person subpoenaed is then waived. The Court did not rebuke that practice so long as all the parties and the subpoenaed witness consents. Otherwise, the Court held, documents may only be produced at the designated deposition, hearing, or trial. This requirement is not dependant upon the documents being confidential or privileged because the interest being protected is the right to notice and an opportunity to object prior to production. Here, Father’s attorney faces potential sanctions for her violation of CRCP 45.
The competition for Aspen property can be fierce – or is it? An estate owns an Aspen condo. It gets foreclosed. The only 3 bidders at the sale bid up the price and then decide to form a joint venture to purchase the property and stop the bidding. They buy the condo. The Court finds they did not engage in unlawful bid-rigging because they did not interfere with competition, or agree to the venture ahead of time, and paid well above the starting price. A co-representative of the estate sought to set aside the sale. She received actual notice of the foreclosure sale but the estate did not. CRCP 120 strictly requires actual notice. Because wife received actual notice of the sale, the estate had constructive notice and chose not to object. So the lack of actual notice did not harm the estate. The sale is not set aside, notwithstanding the failure to comply strictly with CRCP 120.
“Race-notice” says it all. This priority dispute between competing lien-holders involves a unique set of events. An earlier judgment lien recorded against a property was later reformed to a higher amount nunc pro tunc (as if it were so originally). In between recording and reformation of the lien, the debtor sells the property to a new owner, who secures his creditor with a deed of trust recorded against the same property. The creditor was aware of the original judgment lien and the post-judgment litigation. The court of appeals affirmed the trial court’s conclusion that the deed was junior to only the amount of the original judgment lien, not the higher amount, because the normal retroactive effect of an order nunc pro tunc does not apply to innocent third parties. The creditor was “innocent” because it could not reasonably predict that the judgment lien would balloon post-judgment.
The “eggshell skull” is a memorable torts doctrine from law school. Less memorable is the apportionment of damages for aggravation of a pre-existing condition. Both address how to award damages to an injury-prone person. The former provides that a tortfeasor takes a person as they are, including pre-existing conditions, and pays for all damages caused. The latter provides that a tortfeasor does not pay for damages it did not actually cause, even if the person is already injured because of a pre-existing condition. The distinction is fine, but, as the court of appeals found, the difference is a tortfeasor pays for everything if a plaintiff has an asymptomatic pre-existing condition, but partial damages if he/she has a symptomatic pre-existing condition. The court also determined that disability benefits are not a collateral source and not subtracted from total damages.
Aaa, adverse possession: open, notorious, hostile, exclusive, and continuous. Almost describes politics. But in this case, a coal company sought access to its own land, blocked by land adversely possessed, and claimed an implied easement of necessity, or alternatively, access over a road that was once public. The court of appeals held that a parcel of land for which there was a claim of adverse possession could be bounded by a natural feature and not just a fence. And, because the company’s need for access was in the future, and it could just build itself a bridge, it did not have an easement. Also, the failure to join the county as an indispensable party to decide if the road was abandoned or public was fatal to that claim. Last, the court held that a post-trial amendment of the pleadings should have been allowed because an excluded claim was actually tried.
Designated Outdoor Activity Area (DOAA) could describe nearly all of Colorado. So could “oil and gas bonanza.” This case chronicles the struggle of the Colorado Oil and Gas Conservation Commission (COGCC) to balance its power to locate well sites on private property while protecting the landowner’s property. After examining COGCC’s authority, the case turned on the interpretation of one ambiguous rule: to be a DOAA (and there are no oil wells in a DOAA), the area must be “occupied” by at least twenty people for forty days or more. A playground is a DOAA. To be consistent with other rules, the court held that all twenty people need not be present at any one time. It remanded so COGCC could make appropriate findings of fact in deciding the landowner’s request for the designation. But, the COGCC can also consider if the designation would be economically wasteful.
When it comes to real property, a rose is not a rose by any other name. A deed of trust securing an interest in property that does not include a “legal description” is not validly recorded. A street address is not a “legal description.” The Supreme Court gave this response in answering a certified question from the District of Colorado Bankruptcy Court. This case involved a deed of trust that referenced a legal description in an exhibit; it had a street address, but was recorded without the exhibit. The creditor foreclosed on the property after the owner filed for bankruptcy. The bankruptcy Trustee asserted his power to claw-back property, but could only do so if he did not have “notice” of the deed. At the time of the petition, the deed lacked any legal description, and, therefore, it was not validly recorded. The Trustee, lacking “notice,” could claw-back the property from the creditor.