Brant v. Keene Ranch

• Court: Colorado Court of Appeals
• Decided: September 26, 2024
• Docket: 23CA2180
• Status: Unknown

Opinion

23CA2180 Brant v Keene Ranch 09-26-2024

COLORADO COURT OF APPEALS

Court of Appeals No. 23CA2180 Douglas County District Court No. 18CV30598 Honorable Andrew C. Baum, Judge

Beau Brant, Jennifer Brant, Carlos Deromana, Regis Fleury, Sara Vananrooy, Jeff Speich, Mike Money, Shawn Roberts, George M. Gallant, and Dianne M. Gallant,

Plaintiffs-Appellees,

v.

Keene Ranch Homeowners Association, Inc., a Colorado nonprofit corporation,

Defendant-Appellant.

ORDER REVERSED AND CASE REMANDED WITH DIRECTIONS

Division VI Opinion by JUDGE MOULTRIE Welling and Brown, JJ., concur

NOT PUBLISHED PURSUANT TO C.A.R. 35(e) Announced September 26, 2024

The Klug Law Firm, LLC, Noah Klug, Breckenridge, Colorado, for Plaintiffs-Appellees

Allen & Curry, P.C., Theodore A. Wells, Brian M. Swann, Denver, Colorado, for Defendant-Appellant ¶1 Defendant, Keene Ranch Homeowners Association, Inc. (the

association), appeals an order entered awarding attorney fees and

costs to plaintiffs, a group of current and former property owners

(the owners) within the boundaries of Keene Ranch. We reverse the

order and remand with directions.

I. Background

¶2 Keene Ranch is a common interest community within Douglas

County. It was created under section 38-33.3-101, C.R.S. 2024,

after its community declaration, entitled “Common Interest

Community Declaration of Keene Ranch, A Planned Community”

(the declaration) was recorded in December 1995.

¶3 The owners filed a complaint seeking, among other things, a

declaratory judgment that the declaration’s second amendment,

recorded in December 2017 (second amendment), was invalid. The

second amendment revised a section of the declaration regarding

restrictions for animals located within Keene Ranch.

¶4 As relevant here, the owners also claimed that the

association’s record keeping practices violated section

1 38-33.3-317(1), C.R.S. 20181 (records request claim), and that two

homeowner defendants, Wade A. Goetz and Carolyn Licano Goetz

(Goetzes),2 violated a provision of the declaration by building a

second driveway on their property (driveway claim).

¶5 In September 2018, the owners filed a motion for partial

summary judgment asking the trial court to declare the second

amendment invalid as a matter of law. The owners also requested

an award of their attorney fees and costs. In June 2021, the trial

court granted the owners’ motion for partial summary judgment3

and determined that the second amendment was invalid as a

matter of law.

¶6 In April 2022, the owners, the association, and the Goetzes

settled the driveway claim, and the court dismissed the Goetzes

from the case. In July 2023, the owners and the association

(collectively, the parties) settled the records request claim. And, as

1 We cite to the 2018 statute because it was the effective law at the

time of filing, and, in 2021, the General Assembly amended the law by including materially different language. 2 The Goetzes are not parties to this appeal. 3 The owners also filed a second partial motion for summary

judgment that the trial court deemed moot as a result of its granting the owners’ initial motion.

2 relevant here, the terms of both settlements required the parties to

be responsible for their own attorney fees and costs related to the

settled claims.

¶7 In August 2023, the owners filed a motion for attorney fees

and costs (fees and costs motion) related to the second amendment

claim and asserted that (1) section 38-33.3-123(1)(c), C.R.S. 2018,4

supported their request for attorney fees and costs as the prevailing

party; (2) $92,961.41 was a reasonable amount for their requested

attorney fees; and (3) they were entitled to $3,648.55 for costs. In

the fees and costs motion, the owners’ current counsel asserted

that his office billed the owners $117,748.55, while a previous law

firm billed them $6,200, for a total of $123,948.55 in attorney fees

for all three claims. The owners argued that it was reasonable for

the court to deduct 25%, or $30,987.14, from the total amount of

attorney fees billed — thereby resulting in a 75%, or $92,961.41,

award — for prevailing on the second amendment claim because of

4 We cite to the 2018 statute because it was the effective law at the

time of filing, and, in 2024, the General Assembly amended the law by including materially different language.

3 “the work performed, the result obtained, and other factors set out

in Rule 1.5 of the Rules of Professional Conduct.”

¶8 On August 30, 2023, before the association filed a response to

the fees and costs motion, the trial court entered an order awarding

fees and costs to the owners (fees order), which said in its entirety,

THE COURT HEREBY ADJUDGES AS FOLLOWS:

Final judgment is entered in favor of the Plaintiffs and against the Defendant for $92,961.41 in fees and $3,648.55 in costs, for a total of $96,609.96. Such amount shall bear interest at the rate of 8% per annum until the judgment is satisfied. Pursuant to C.R.S. § 38-33.3-123(1)(c), the Plaintiffs are also awarded reasonable costs and attorney’s fees of collection in amounts to be determined.

¶9 The next day, the association filed a forthwith motion for

reconsideration under C.R.C.P. 59 (Rule 59 motion) asking the

court to vacate the fees order, expedite a briefing schedule on the

Rule 59 motion, and reserve ruling on the fees and costs motion

until after it was fully briefed. The day after that, the association

filed its response to the fees and costs motion.

¶ 10 On September 7, the trial court issued an order on the Rule 59

motion staying the fees order “to consider [the association’s]

4 response to the [the owners’] request for attorney[] fees.” The court

also authorized the owners to file a reply. A week later, the owners

filed their reply. The trial court took no additional action on the

stayed fees order or the parties’ pleadings before the association

appealed the fees order on December 19, 2023.

II. Standard of Review

¶ 11 We review a trial court’s award of attorney fees and costs for

an abuse of discretion. Accetta v. Brooks Towers Residences Condo.

Ass’n, 2021 COA 147M-2, ¶ 43. A trial court abuses its discretion

when its ruling is manifestly arbitrary, unreasonable, or unfair or

based on a misapplication or misunderstanding of the law. Credit

Serv. Co. v. Skivington, 2020 COA 60M, ¶ 17. However, even if an

abuse of discretion is found, reversal is unwarranted “unless the

error is shown to be prejudicial to the substantive rights of the

aggrieved part[y].” Askew v. Gerace, 851 P.2d 199, 201-02 (Colo.

App. 1992); see C.R.C.P. 61. An error affects a party’s substantial

rights if it impaired the basic fairness of the trial or substantially

influenced the outcome of the case. Bernache v. Brown, 2020 COA

106, ¶ 26.

5 III. Applicable Legal Principles

¶ 12 When a court awards a prevailing party its attorney fees, such

fees must be reasonable. See Colo. RPC 1.5(a); Tisch v. Tisch, 2019

COA 41, ¶ 84. “To determine what constitutes a reasonable fee, a

court uses a well-established analytical framework,” Cronk v.

Bowers, 2023 COA 68M, ¶32, which provides the court an initial

estimate of the “lodestar” amount, Tisch, ¶ 84 (outlining the

framework a court uses to determine the lodestar amount). The

lodestar amount “represents the number of hours reasonably

expended multiplied by a reasonable hourly rate,” which then

creates a strong presumption of reasonableness. Tallitsch v. Child

Support Servs., Inc., 926 P.2d 143, 147 (Colo. App. 1996).

¶ 13 A ruling that awards attorney fees must contain sufficient

findings of fact to allow meaningful appellate review. Yaekle v.

Andrews, 169 P.3d 196, 201 (Colo. App. 2007), aff’d on other

grounds, 195 P.3d 1101 (Colo. 2008); see Carruthers v. Carrier

Access Corp., 251 P.3d 1199, 1212 (Colo. App. 2010) (noting that an

award of attorney fees “cannot stand” where the trial court didn’t

identify the basis for awarding fees and made no factual findings

supporting its determination); see also C.R.C.P. 121, § 1-22(2)(c).

6 IV. Discussion

¶ 14 On appeal, the association asserts that (1) the fees order

doesn’t contain sufficient findings to permit meaningful appellate

review, and (2) the trial court abused its discretion when it entered

the fees order before the association filed its response to the fees

and costs motion. Because we agree with the association’s first

contention, we decline to address its second. See Laleh v. Johnson,

2016 COA 4, ¶ 37 (declining to address subsequent contentions

where the underlying judgment was reversed and remanded to the

trial court), aff’d on other grounds, 2017 CO 93.

¶ 15 The association cites Cronk (reversing an award of attorney

fees and costs where the trial court failed to make sufficient

findings) and Carruthers in support of their appeal, while the

owners largely rely on Foster v. Phillips, 6 P.3d 791, 796 (Colo. App.

1999) (noting that while it is better practice for a court to make

express findings, they may be implicit in a court’s ruling). The

owners concede that the fees order doesn’t contain “detailed

findings,” but they argue that when the order is read in conjunction

with the record, the basis and reasoning for the trial court’s ruling

is clear and valid. We aren’t persuaded.

7 ¶ 16 In Foster, a division of this court concluded that “[w]hen the

ruling, in the context of the record, is sufficient to determine its

basis, and the record is sufficient to support the award, a failure to

make express findings does not require reversal.” Id. at 796.

¶ 17 The owners contend that the fees and costs motion provided a

sufficient basis for the fees order because it detailed the work their

counsel completed related to the second amendment claim and

included the required lodestar amount. They argue that the trial

court “impliedly adopt[ed] the reasoning of [the fees and costs

motion].” But the fees and costs motion didn’t detail how the

owners’ counsel determined that 75% of the total attorney fees

billed was reasonable given that two of the three claims were

resolved by settlements — occurring months and years after the

declaratory judgment claim was resolved — that required the

parties to be responsible for their own attorney fees and costs. And

it was a factual question for the trial court to determine whether the

25% reduction was reasonable. Thus, the owners’ reliance on

Foster is misplaced because the record here isn’t sufficient to

support the award, and the fees order doesn’t contain any findings

of fact or legal analysis that enable us to conduct a meaningful

8 review. See Carruthers, 251 P.3d at 1212; see also Yaekle, 169

P.3d at 201.

¶ 18 Accordingly, we conclude that the trial court abused its

discretion when it entered the fees order. And given the order’s

deficiencies, we can’t conclude that its error was harmless. See

C.R.C.P. 61.

V. Appellate Attorney Fees

¶ 19 Lastly, we deny the owners’ request for an award of their

appellate attorney fees and costs because they did not prevail on

appeal. See C.A.R. 39(a)(3), 39.1; see also Mountain States

Adjustment v. Cooke, 2016 COA 80, ¶ 47 (nonprevailing appellate

party is not entitled to award of appellate attorney fees).

VI. Disposition

¶ 20 The order is reversed, and the case is remanded for further

proceedings consistent with this opinion.

JUDGE WELLING and JUDGE BROWN concur.