23CA1943 Bonati v KDSW 10-17-2024
COLORADO COURT OF APPEALS
Court of Appeals No. 23CA1943 Jefferson County District Court No. 20CV30537 Honorable Diego G. Hunt, Judge
John E. Bonati; Charles A. Bonati, Jr.; and Crystal A. Bonati,
Plaintiffs-Appellees,
v.
KDSW Holdings, LLLP, a Colorado limited liability limited partnership; and Keith V. Bonati,
Defendants-Appellants.
JUDGMENT AFFIRMED AND CASE REMANDED WITH DIRECTIONS
Division II Opinion by JUDGE SCHOCK Fox and Johnson, JJ., concur
NOT PUBLISHED PURSUANT TO C.A.R. 35(e) Announced October 17, 2024
Fennemore Craig, P.C., David M. “Merc” Pittinos, Allison M. Hester, Denver, Colorado, for Plaintiffs-Appellees
Springer & Steinberg, P.C., Christopher S. Maciejewski, Denver, Colorado, for Defendants-Appellants ¶1 Defendants, Keith V. Bonati and his entity KDSW Holdings,
LLLP (KDSW), appeal the judgment entered against them and in
favor of plaintiffs, John E. Bonati, Charles A. Bonati, Jr. (Charlie),
and Crystal A. Bonati, and cross-claim defendant, Charles A.
Bonati, Sr., and ordering the partition by sale of real property the
parties co-own. We affirm the judgment and remand the case to the
district court to award plaintiffs their reasonable attorney fees and
costs incurred on appeal in connection with their civil theft claim.
I. Background
¶2 This case stems from the Bonati family’s joint ownership of a
107-acre piece of unimproved land (the property). The property is
geographically diverse and lacks an access road, the previous road
having been destroyed by flooding years ago. A new road has since
been built, but the Bonatis have been unable to secure an easement
over that road, leaving the property accessible only by foot.
¶3 The property was previously owned by Charles,1 the patriarch
of the family. In 2003, Charles conveyed the property to his four
1 Because the parties in this case share the same last name, we
refer to them by their first names, intending no disrespect. We refer to Charles A. Bonati, Sr., as Charles and Charles A. Bonati, Jr., as Charlie, consistent with the names used in the parties’ briefs.
1 sons — John, Charlie, Keith (through KDSW), and Scott Bonati —
as tenants in common, while reserving a life estate for himself.
After several transactions over the next two decades, the property is
currently owned in various percentages by Charlie, Crystal
(Charlie’s wife), John, and KDSW. In 2020, Charles conveyed his
life estate to those four owners, thus terminating the life estate.
¶4 When Charles conveyed the property to his sons in 2003, the
brothers discussed sharing the cost of taxes and other expenses
associated with the property. But they disagree about whether they
reached any agreement. John and Charlie testified at trial that the
brothers verbally agreed to pay the property taxes. Keith testified
that they did not. Either way, there was no written agreement.
¶5 Until 2012, the property taxes were low — approximately $200
per year — and Charles paid them. But in 2012, the annual taxes
increased to more than $13,000, and the brothers again discussed
sharing responsibility for the taxes. From that point on, one or
more of the brothers paid the taxes — but never on time. For the
next several years, the family repeatedly missed tax payments,
allowed the property to go to tax sales, and redeemed the tax liens.
2 ¶6 In 2015 and 2016, with taxes still owed for prior years, Keith
(through another entity he owned) purchased the tax liens on the
property, and John reimbursed him for half of the purchase price.
Charlie later paid Keith and John $25,000 each — Keith for past
due taxes and John for contemplated future improvements
necessary to sell the property. The plan was for the brothers to
acquire title to the property through a treasurer’s deed, secure a
road access easement, and then prepare the property for sale.
¶7 But before the treasurer’s deed was issued, Scott thwarted the
plan by unexpectedly redeeming the outstanding tax liens, which he
could do as a co-owner of the property. As the lienholder, Keith
received the redemption payments, which reimbursed him for the
amounts he had paid to purchase the liens. John and Charlie, in
turn, asked Keith to return the money they had paid him in
furtherance of the now-foiled plan. Keith refused to do so. He
maintained that the county had incorrectly allowed Scott to redeem
the liens, and once it realized its mistake, Keith would need the
money to repay Scott and move forward with the original plan.
¶8 With the brothers at an impasse, plaintiffs initiated this action
to partition the property by sale. Charlie and John also asserted
3 claims against defendants for unjust enrichment, promissory
estoppel, and civil theft based on the money they had paid Keith
that Keith had not returned. Defendants asserted counterclaims
against plaintiffs and cross-claims against Charles, including for
(1) unjust enrichment for taxes and other expenses they had paid;
and (2) a partnership accounting under the Colorado Uniform
Partnership Act (1997), sections 7-64-401 to -405, C.R.S. 2024.
¶9 After a bench trial, the district court ruled for plaintiffs. As
relevant to this appeal, the district court (1) found that Charles was
not liable for property taxes as the owner of a life estate because the
brothers had agreed to pay the taxes; (2) ruled in favor of plaintiffs
on their claims of civil theft, promissory estoppel, and unjust
enrichment; (3) denied defendants’ partnership accounting claim
because the parties did not carry on a business for profit under
section 7-64-202(1), C.R.S. 2024; and (4) ordered the sale of the
property through a mutually agreeable real estate broker.
4 II. Standard of Review
¶ 10 Our review of a judgment after a bench trial presents a mixed
question of fact and law. State ex rel. Weiser v. Ctr. for Excellence in
Higher Educ., Inc., 2023 CO 23, ¶ 33. We review the district court’s
factual findings for clear error and its legal conclusions de novo.
Kroesen v. Shenandoah Homeowners Ass’n, 2020 COA 31, ¶ 55.
¶ 11 In conducting this review, we defer to the district court’s
credibility determinations and its assessment of the weight and
probative effect of the evidence. Amos v. Aspen Alps 123, LLC, 2012
CO 46, ¶ 25; Saturn Sys., Inc. v. Militare, 252 P.3d 516, 521 (Colo.
App. 2011). We will not disturb its factual findings unless they are
clearly erroneous and unsupported by the record. Amos, ¶ 25.
III. Responsibility for Property Taxes
¶ 12 Relying on Dormer v. Walker, 69 P.2d 1049, 1051 (Colo. 1937),
defendants first argue that the district court erred by concluding
that Charles was not responsible for the property taxes during the
pendency of his life estate. In Dormer, the supreme court held that
“where the instrument creating the life estate is silent as to [the
payment of taxes], it is the duty of the owner of a life estate, who is
entitled to receive the rents, issues, and profits therefrom, to keep
5 paid all current taxes and assessments.” Id. The district court held
that the rule in Dormer did not apply because (1) the property did
not generate any income or profits during the term of Charles’s life
estate, and (2) the brothers agreed to be responsible for the property
taxes after the 2003 conveyance. Because the record supports the
district court’s second rationale, we need not address the first.
¶ 13 Although Dormer sets forth a default rule, the parties may
agree to change that rule and allocate responsibility for taxes as
they choose. See Kendall v. Wiles, 483 P.2d 388, 389 (Colo. App.
1971) (noting parties’ agreement that owner of fee title, not owner of
life estate, would make all future mortgage, insurance, and tax
payments); cf. Robinson v. Tubbs, 344 P.2d 1080, 1081 (Colo. 1959)
(holding that “the ultimate criterion” for determining whether the
life tenant or remainderman is responsible for paying property taxes
is “the intention of the creator of these estates as determined from
the terms of the instrument creating them”) (citation omitted);
Dormer, 69 P.2d at 1051 (noting that obligation to pay taxes may
arise “under the terms of the agreement or by operation of law”).
¶ 14 The record supports the district court’s factual finding that the
brothers agreed that they — not Charles — would be responsible for
6 paying property taxes after the 2003 conveyance. Both John and
Charlie testified that the brothers reached a verbal agreement in
2003 that they would pay the taxes. And at least after 2012, when
the taxes increased above a de minimis amount, the brothers acted
somewhat consistently with that agreement by, individually or
collectively, purchasing and redeeming the tax liens — albeit, after
failing to pay the taxes on time in the first place.
¶ 15 Indeed, before backtracking at trial, defendants themselves
acknowledged such an agreement. In their counterclaim and cross-
claim, defendants alleged that “[w]hen Charles Sr. conveyed the
Property to [the brothers], the parties intended that the transferees
would share equally in the responsibility for maintenance, taxes,
and other expenses.” And they sought a declaration that “the
owners of the remainder interests have an implied agreement to
share equally responsibility for taxes and costs of maintaining the
Property.” Thus, the district court’s ruling on this point was
consistent with defendants’ initial position and requested relief.
¶ 16 Defendants now dispute the existence of such an agreement,
characterizing John’s and Charlie’s testimony as self-serving and
contradictory. They urge us to instead credit Keith’s testimony that
7 although the brothers discussed paying the property taxes, they
never reached an agreement. But it is the district court’s role, not
ours, to assess the credibility of witnesses and resolve conflicts in
the evidence. See Highlands Broadway, OPCO, LLC v. Barre Boss
LLC, 2023 COA 5, ¶ 26. The district court did so here and found
the testimony that there was a verbal agreement to be “credible.”
We must defer to that credibility finding. See Amos, ¶ 25.
¶ 17 Defendants cite other evidence in the record that could
support a contrary finding. For example, they note that Charles
paid the property taxes until 2012 and that, once he stopped, the
brothers never timely did so. They point to the lack of a written
agreement or any reference in the deed to the payment of taxes.
They highlight the lack of coordination and equal participation
among the brothers in redeeming the tax liens, including Charlie’s
failure to contribute to the taxes at all until 2018. And they assert
that the brothers’ inability to agree on anything concerning the
property undermines any suggestion that they could agree on this.
¶ 18 But these are all factual questions for the district court. We
may not reweigh the evidence and substitute our judgment. See
Owners Ins. Co. v. Dakota Station II Condo. Ass’n, 2021 COA 114,
8 ¶ 50. Rather, because there is record support for the district
court’s factual finding, we will not disturb it. See Amos, ¶ 25.
IV. Civil Theft, Unjust Enrichment, and Promissory Estoppel
¶ 19 Defendants next contend that the district court erred by ruling
in favor of plaintiffs on their claims for civil theft, unjust enrichment
and promissory estoppel, all arising out of Keith’s failure to return
the money John and Charlie paid him. We disagree.
¶ 20 Initially, we note that each of these claims concerns the same
sums of money and the same set of facts. With each, John and
Charlie sought the return of money they paid Keith for property
taxes and other expenses because Keith’s purchase of the tax liens
was reimbursed by another source (Scott’s redemption of the lien),
and the remaining funds were not used as intended. Thus, the
damages for the unjust enrichment and promissory estoppel claims
were subsumed in the damages for the civil theft claim (which
included treble damages), making any error as to those claims
harmless if the civil theft award is upheld. See Schuessler v. Wolter,
2012 COA 86, ¶ 63 (“A plaintiff generally may not receive a double
recovery for the same wrong.”). Regardless, we perceive no error.
9 A. Civil Theft
¶ 21 Defendants assert that the district court clearly erred by
finding that they acted with the specific intent to permanently
deprive Charlie and John of the benefit of the money they paid him.
This is a factual question that we review for clear error. See In re
Estate of Chavez, 2022 COA 89M, ¶ 47; Amos, ¶ 25. We will uphold
the district court’s finding if it has record support. Amos, ¶ 25.
¶ 22 To prevail on a claim of civil theft, a plaintiff must prove two
elements: (1) the defendant knowingly obtained control over the
plaintiff’s property without authorization, and (2) the defendant did
so with the “specific intent to permanently deprive the plaintiff of
the benefit of the property.” Tisch v. Tisch, 2019 COA 41, ¶ 51; see
also §§ 18-4-401(1), -405, C.R.S. 2024. Defendants challenge only
the second element.
¶ 23 The district court found that Keith “intentionally took and
kept” the specified funds from John and Charlie, “intending to
permanently deprive them of those funds.” There is support in the
record for that finding. The evidence showed that John and Charlie
gave Keith money for a specific purpose — John for the purchase of
the tax liens and Charlie for taxes and other property expenses —
10 as part of a plan to acquire a treasurer’s deed and sell the property.
Then, when Scott redeemed the tax liens, thwarting the plan and
reimbursing Keith for the amounts he had paid, John and Charlie
asked for their money back. But despite their repeated demands,
Keith refused. That fact alone supports a finding that Keith
intended to permanently deprive John and Charlie of those funds.
¶ 24 Defendants offer several alternative explanations as to why
they held onto the funds:
• Keith believed Scott’s redemption of the tax liens had
been untimely, and once the error was corrected, Keith
would be required to repay the redemption amount.
• Keith believed the funds could still be used as intended,
and John’s and Charlie’s demands for return of the funds
were contrary to their agreed-upon plan.
• Keith believed that Charlie owed him more in back taxes
than Charlie had paid him.
• Keith suffered a severe health crisis that caused him to
withdraw from family interactions around the time that
John and Charlie were demanding return of the funds.
11 ¶ 25 But at most, these alternative explanations merely offer
different reads of the evidence, or other findings the court could
have made. The district court’s factual finding is not clearly
erroneous just because the evidence might also have supported a
contrary finding. See Casserly v. State, 844 P.2d 1275, 1281 (Colo.
App. 1992) (“A court’s findings based upon a choice between two
plausible views of the weight of the evidence or upon a choice
between conflicting inferences from the evidence is not clearly
erroneous.”). Because the district court’s finding is supported by
the record, that finding is not clearly erroneous. See Amos, ¶ 25.
B. Unjust Enrichment
¶ 26 Defendants next argue that the district court (1) applied the
wrong legal test to the unjust enrichment claims and (2) abused its
discretion by finding in favor of Charlie and John on those claims.
¶ 27 A party claiming unjust enrichment must prove that “(1) the
defendant received a benefit (2) at the plaintiff’s expense (3) under
circumstances that would make it unjust for the defendant to retain
the benefit without commensurate compensation.” Lewis v. Lewis,
189 P.3d 1134, 1141 (Colo. 2008). In cases involving “failed
contracts between close family members or confidants,”
12 malfeasance is not required. Id. at 1143. Rather, “when close
family members or confidants act with a mutual purpose, unjust
enrichment occurs when one party benefits from an action that is a
significant deviation from that mutual purpose.” Id.
¶ 28 Because unjust enrichment is an equitable remedy, we review
the district court’s ruling on an unjust enrichment claim for an
abuse of discretion. Id. at 1140-41. We review de novo whether the
district court correctly understood the appropriate test. Id. at 1141.
¶ 29 Defendants argue that the district court failed to apply the test
in Lewis. But they do not develop this argument. See Woodbridge
Condo. Ass’n v. Lo Viento Blanco, LLC, 2020 COA 34, ¶ 41 n.12
(declining to consider “undeveloped and unsupported arguments”),
aff’d, 2021 CO 56. They do not explain how the district court’s
analysis was inconsistent with Lewis. And to the extent they
suggest that Lewis’s “close family member” refinement of the third
unjust enrichment element should apply under the circumstances
of this case, they do not develop that point either. Lewis, 189 P.3d
at 1142. Nor did defendants preserve any Lewis-based arguments
in the district court. See Melat, Pressman & Higbie, L.L.P. v.
13 Hannon L. Firm, L.L.C., 2012 CO 61, ¶ 18 (declining to address
unpreserved issues in a civil case).
¶ 30 In any event, although the district court did not expressly cite
Lewis or its elements, it effectively applied that test by finding that
(1) Keith received and retained money; (2) paid by John and Charlie;
(3) even though the parties’ plan for those funds had failed. To the
extent the Lewis test for “close family members” acting with a
“mutual purpose” applies, the district court’s findings further
establish that Keith “benefit[ted] from . . . a significant deviation
from that mutual purpose.” Lewis, 189 P.3d 1134. More
specifically, the court found that Keith kept the funds when they
could no longer be used for their intended purpose. And although
defendants argue that it was John and Charlie who deviated from
the parties’ mutual purpose by demanding the return of the funds,
that was a question of fact for the district court. See id. at 1144.
¶ 31 Because the district court applied the correct legal analysis
and its findings have record support, the court did not abuse its
discretion by finding that Keith had been unjustly enriched. See id.
14 C. Promissory Estoppel
¶ 32 Defendants lump the promissory estoppel claim in with their
challenges to the civil theft and unjust enrichment claims, asserting
that the district court abused its discretion by ruling against them
on that claim as well. But they do not make any distinct argument
with respect to that claim, other than the conclusory assertion that
the parties’ conduct failed to satisfy the elements of such a claim.
See Barnett v. Elite Props. of Am., Inc., 252 P.3d 14, 19 (Colo. App.
2010) (“We will not consider a bald legal proposition presented
without argument or development.”). Even were we to consider this
undeveloped claim, we perceive no abuse of discretion. See La Plata
Med. Ctr. Assocs., Ltd. v. United Bank of Durango, 857 P.2d 410,
420 (Colo. 1993) (reviewing equitable claims for abuse of discretion).
¶ 33 A promissory estoppel claim has four elements: (1) the
promisor made a promise; (2) the promisor should have reasonably
expected that the promise would induce action or forbearance by
the promisee; (3) the promisee reasonably relied on the promise to
their detriment; and (4) the promise must be enforced to prevent
injustice. Cherokee Metro. Dist. v. Simpson, 148 P.3d 142, 151
(Colo. 2006).
15 ¶ 34 The district court correctly cited this test and made findings
sufficient to satisfy the elements of that claim, albeit not in the
terminology of the test. See Foster v. Phillips, 6 P.3d 791, 796 (Colo.
App. 1999) (noting that findings may be implicit in a court’s ruling).
The evidence described above provides record support for each of
those elements: (1) Keith told John and Charlie he would use their
money to purchase the tax liens and pay property taxes so the
brothers could acquire a treasurer’s deed and sell the property;
(2) Keith should have reasonably expected that promise to induce
John and Charlie to send him the money; (3) John and Charlie
reasonably relied on the promise by sending Keith money; and
(4) Keith did not ultimately use the money for the promised
purpose. Again, any challenges defendants make to these elements
go to the weight of the evidence. See Saturn Sys., 252 P.3d at 521.
V. Business For Profit
¶ 35 Defendants next argue that the district court erred by finding
that the parties did not carry on a “business for profit,” as
necessary to form a partnership under section 7-64-202(1). They
assert that the brothers engaged in a “business for profit” by paying
16 back taxes and agreeing to share in future expenses for the purpose
of eventually selling the property for a profit. We disagree.
¶ 36 A partnership is an “association of two or more persons to
carry on as co-owners a business for profit.” § 7-64-202(1). A
“[b]usiness” is any “trade, occupation, and profession.” § 7-64-
101(2), C.R.S. 2024. Joint ownership of property “does not by itself
establish a partnership, even if the co-owners share profits made by
the use of the property.” § 7-64-202(3)(a); see also Brown v. Miller,
141 P.2d 682, 684 (Colo. 1943) (“[M]ere joint ownership of land does
not establish a partnership even though profits are shared . . . .”).
¶ 37 The existence of a partnership is a question of fact. Reid v.
Pyle, 51 P.3d 1064, 1067 (Colo. App. 2002). We thus review the
court’s factual findings for clear error and will not disturb them if
they have record support. Id. Whether those facts establish a
partnership is a question of law that we review de novo. Id.
¶ 38 We agree with the district court that the parties’ efforts to
preserve their title to the property so they could someday sell it does
not constitute a business for profit. First, the property was not
used for a “trade, occupation, or profession.” § 7-64-101. Rather,
the district court found, with record support, that the property was
17 “primarily used for recreation” and generated no income. Second,
the mere act of holding a single piece of property for future sale —
and paying property taxes — is not a business. Most property
owners hope to one day sell their property for a profit and know
they must pay taxes in the meantime. That does not, without more,
make property ownership a business. See § 7-64-202(3)(a).
¶ 39 We acknowledge that there was some evidence of
coordination — or at least attempts at coordination — among the
brothers. But the focus of that coordination was primarily confined
to taking care of the back taxes so the family did not lose the
property. Other than some unfruitful discussions about
purchasing an access easement, there was no evidence of any other
shared expenses. Cf. Yoder v. Hooper, 695 P.2d 1182, 1187 (Colo.
App. 1984) (noting that parties contributed an equal amount and
intended to share equally in the responsibilities of the partnership),
aff’d, 737 P.2d 852 (Colo. 1987). The district court found that the
brothers did not agree to divide maintenance costs and that any
work Keith performed on the property was “gratuitous and not
compensable.” To the extent the brothers anticipated sharing in
18 future profits from the sale of the property, that was not so much
an agreement as it was a consequence of their joint ownership.
¶ 40 In short, the facts found by the district court establish little
more than that the brothers received property from their father and
took the minimum steps necessary to retain it. The district court
did not err by concluding that was not a business for profit.
VI. Partition Sale
¶ 41 Defendants’ final argument is that the district court abused its
discretion by ordering the partition sale to proceed through a real
estate broker. Their primary argument appears to be that such a
sale is not a “public sale” within the meaning of section 38-28-107,
C.R.S. 2024, and thus, was not authorized by statute. We disagree.
¶ 42 Section 38-28-107 provides that “[i]f the commissioners report
and the court finds that partition of the property cannot be made
without manifest prejudice to the rights of any interested party, the
court may direct the sale of such property at public sale upon such
terms as the court may fix.” In doing so, the court “may make such
orders as it may deem necessary to promote the ends of justice to
completely adjudicate every question and controversy concerning”
the rights and interests in the property. § 38-28-110, C.R.S. 2024.
19 ¶ 43 In ordering a partition by sale, the district court expressly
rejected plaintiffs’ argument that the sale should be private.
Instead, the court ordered that “the sale is to be public — that is,
not restric[t]ing the parties, their family members, or associates
related to these proceedings from participating in the sale.” To the
extent defendants assert that a sale through a real estate broker,
open to any member of the public, is not a “public sale,” they do not
develop that argument or cite any authority to support it. See
Woodbridge Condo. Ass’n, ¶ 41 n.12; see also 59A Am. Jur. 2d
Partition § 125, Westlaw (database updated Aug. 2024) (contrasting
“public sale” with “private sale,” which is “confined to the parties”).
¶ 44 Moreover, the district court has discretion to fix the terms of
the sale, see § 38-28-107, and to “make such orders as it may deem
necessary to promote the ends of justice,” § 38-28-110. The district
court found that a sale through a real estate broker was necessary
to “maximiz[e] the sale price of the Property and to prevent the
Bonati family members from using a sheriff’s sale as a weapon in
their ongoing dispute.” Given the well-established acrimony among
the family, that was a reasonable exercise of the court’s discretion.
20 ¶ 45 Defendants make cursory references to other claimed
deficiencies in the district court’s order, including the failure to
appoint a commissioner and the grant of powers to the real estate
broker beyond those authorized by statute. But they make no
argument on these points. We decline to address an issue
presented without argument. See Barnett, 252 P.3d at 19. We also
will not address arguments raised for the first time in the reply
brief. People v. Czemerynski, 786 P.2d 1100, 1107 (Colo. 1990),
abrogated on other grounds by Rojas v. People, 2022 CO 8.
VII. Attorney Fees
¶ 46 Plaintiffs request an award of their appellate attorney fees and
costs in connection with their civil theft claim under section 18-4-
405. Because we affirm the district court’s finding of civil theft, we
grant this request. See Black v. Black, 2018 COA 7, ¶ 130. We
exercise our discretion under C.A.R. 39.1 to remand the case to the
district court to determine and award plaintiffs their reasonable
appellate attorney fees as related to the civil theft claim only.
¶ 47 We deny plaintiffs’ request for appellate attorney fees under
section 13-17-102(2), C.R.S. 2024. Although defendants did not
prevail, we do not view their arguments as so lacking in substantial
21 justification as to warrant an attorney fee award under that statute.
See In re Marriage of Boettcher, 2018 COA 34, ¶ 38 (“Fees should be
awarded only in clear and unequivocal cases when the appellant
presents no rational argument, or the appeal is prosecuted for the
purpose of harassment or delay.”), aff’d, 2019 CO 81.
VIII. Disposition
¶ 48 The judgment is affirmed, and the case is remanded to the
district court to award plaintiffs their reasonable attorney fees and
costs incurred on appeal in connection with their civil theft claim.
JUDGE FOX and JUDGE JOHNSON concur.