Colorado Court of Appeals – Week of September 25

Colorado Court of Appeals Sep 27, 2023

By: Alan Schindler, Esq. and Anna Goldman, Esq.

Faith Tolle and Grace Aragon v. Steeland, LLC, and Jaida McKeever, 22CA0790

Division V, Opinion by Judge Yun, Judge Brown, and Judge Davidson concur

Decision: Affirmed

Procedure: On appeal from District Court, Mesa County, Judge Lance P. Timbreza

Factual Background and District Court Holding:

After a fatal apartment fire, plaintiffs, daughters of the deceased, brought three claims against the defendants, the owner, and manager of the apartment building, under the Wrongful Death Act, § 13-21-202, C.R.S. 2023. The defendants moved to compel arbitration and dismiss the complaint under Colo. R. Civ. P. 12(b)(1) as the lease required the parties to arbitrate “all disputes arising in connection with” the lease. The district court dismissed the motion to compel arbitration, reasoning that the arbitration clause did not apply to the plaintiff’a claims because the clause did not mention wrongful death claims and such claims are too attenuated from the lease agreement.

Issue: Do wrongful death claims based on a fatal apartment fire “arise in connection with” the apartment’s residential lease?

The Court of Appeals addressed whether the wrongful death claim based on the apartment fire arose in connection with the apartment’s lease. After noting that in order to fall within the scope of the arbitration clause, the claim “must originate from and relate to the lease,” the Court concluded that the plaintiff’s claims arose under Colorado’s Premises Liability Act (PLA), § 13-21-115, C.R.S. 2023, not any provision in the lease.

The PLA is the sole remedy against landowners for injuries on their property. Vigil v. Franklin, 103 P.3d 322, 328-29 (Colo. 2004). Here, the wrongful death lawsuit was a result of a fire that plaintiffs allege was caused by the defendant’s failure to take reasonable care to protect its residents. These failures were breaches of the duty that the defendants owed its residents under the PLA. Thus, plaintiffs’ claims arose under the PLA, not any provision of the lease.

South Conejos School Dist. RE-10 v. Wold Architects Inc., 23CA0595

Division V, Opinion by Judge Fox, Judge Brown, and Judge Dailey concur

Decision: Affirmed and remanded with instructions

Procedure: On appeal from District Court, Conejos County, Judge Crista Newmyer-Olsen

Factual Background and District Court Holding:

This case arises from the construction of a school that was damaged by a flood, leading the plaintiff, the school district, to believe that the elements of the construction were defective. The accrual provision in the relevant contract provided for a longer accrual period than prescribed in section 13-80-104(1)(b), C.R.S. 2023. The district court held that despite this discrepancy, the accrual period in the contract was permissible and enforceable.

Issue: Whether a contract provision extending the time for accrual of construction defect claims is void and unenforceable.

The Court of Appeals addressed whether a contract provision extending the time for accrual of construction defect claims beyond that identified in section 13-80-104(1)(b) is void and unenforceable. Section 13-80-104(1)(b)(I) provides that “a claim for relief arises… at the time the claimant… discovers or in the exercise of reasonable diligence should have discovered the physical manifestations of a defect in the improvement which ultimately causes the injury.” The contract at hand provided that the accrual period began only when the plaintiff knew of the defect.

Parties to a contract may agree on terms so long as those terms do not violate statutory provisions or public policy. See Fox v. I-10, Ltd., 957 P.2d 1018, 1021-22 (Colo. 1998). The Court concluded that neither section 13-80-104(1)(b) nor public policy prohibits extending the accrual date. The Court reasoned that the plain language of section 13-80-104(1)(b) does not indicate that the legislature intended to prohibit sophisticated parties from agreeing to a different accrual date. Additionally, the defendant presented no public policy argument that outweighed Colorado’s interest in protecting the freedom of contract. Following, the Court held that “sophisticated contracting parties may agree to extend the accrual period without violating public policy.”

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Colorado Court of Appeals

Colorado Court of Appeals – Week of September 25

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