23CA1970 Innis v Innis 10-03-2024
COLORADO COURT OF APPEALS
Court of Appeals No. 23CA1970 Mesa County District Court No. 20CV30309 Honorable Valerie J. Robison, Judge
Norma J. Innis and Richard L. Innis,
Plaintiffs-Appellees,
v.
Dain D. Innis and Lynnette Y. Innis,
Defendants-Appellants.
JUDGMENT AFFIRMED
Division II Opinion by JUDGE JOHNSON Fox and Schock, JJ., concur
NOT PUBLISHED PURSUANT TO C.A.R. 35(e) Announced October 3, 2024
Brett R. Lilly, LLC, Brett R. Lilly, Wheat Ridge, Colorado, for Plaintiffs-Appellees
Wegener Lane & Evans, P.C., Benjamin M. Wegener, Dalen B. Porter, Grand Junction, Colorado, for Defendants-Appellants ¶1 Defendants, Dain D. Innis (Dain) and Lynette Y. Innis (Lynn),1
appeal the district court’s judgment concluding that plaintiff Norma
J. Innis (Norma) did not convey water rights to Dain’s sole
ownership. We affirm.
I. Background
¶2 Norma and her husband, Richard L. Innis (Richard), owned
several adjacent properties in Grand Junction: 2108 Desert Hills
Road (2108 property), 2110 1/2 Desert Hills Road (2110 1/2
property), and 2112 Desert Hills Road (2112 property). Norma and
Richard live at the 2108 property. Dawn Maiella (Dawn), Norma
and Richard’s daughter and Dain’s sister, lives at the 2112
property. In 1989, the three properties were placed into the Innis
Land Trust (trust). At the creation of the trust, no Innis family
member held an interest in 2110 Desert Hills Road (2110 property),
the property at issue in the action.
¶3 The 2110 property parcel includes portions of two bodies of
water. The parties refer to the bigger body of water as Barrett Pond
1 Because many of the parties share the same last name, we will
refer to individuals by their first names. No disrespect is intended.
1 (and sometimes the “lake”) and the smaller body of water as Barrett
Ditch.
¶4 In 1990, Dain moved to Grand Junction and lived with Norma
and Richard. Dain eventually moved into a mobile home placed on
the 2110 1/2 property. Norma and Richard intended that the 2110
1/2 property and the 2112 property be given to Dawn and Dain,
respectively, as their shares of the trust. The map below, which
was admitted as an exhibit at trial, depicts the four properties
discussed in this opinion.2
2 The map is an aerial view of the four properties discussed in this
opinion taken from plaintiff’s Exhibit 20. The image includes the properties from top to bottom: 2108, 2110, 2110 1/2, and 2112. There are yellow lines depicting the boundaries of the four properties. The 2110 1/2 property does not have a number labeling it. The properties adjacent to the numbered properties are not a part of this matter.
2 ¶5 In 1993, Juel Noren (Noren) and his spouse purchased the
2110 property. Norma and Richard became close with the Norens,
and the four discussed Norma and Richard’s acquisition of that
property to place in the trust corpus. In 2003, an agreement and
promissory note were drafted; the agreement was signed by Dain
and Norma and the promissory note was signed by Dain, Norma,
and Richard. Noren did not sign the agreement, so the 2110
3 property did not transfer at that time; Noren intended to devise the
2110 property to the Innises upon his death.
¶6 In February 2005, however, Noren executed a warranty deed
conveying the property in joint tenancy to himself, Norma, and
Dain. Following Noren’s death, a relative of Noren’s unsuccessfully
challenged Noren’s conveyance of the 2110 property to Dain and
Norma. After the lawsuit, Dain and his wife, Lynn, began living on
the property.
¶7 In 2014, a fire caused extensive damage to the 2110 property.
The property was covered by a homeowner’s insurance policy.
Insurance payouts were made to Dain and Norma, as joint tenants,
and were received in the mail via check. The insurance proceeds
were used to build a new home. To facilitate electronic delivery of
the insurance proceeds, Dain added Norma to his bank account.
¶8 The insurance proceeds did not cover the entire rebuilding
cost. Norma was unwilling to cosign a loan, but she agreed to sign
a quitclaim deed so that the 2110 property would be solely in Dain’s
name and could be used as collateral.
¶9 At the bench trial, Richard and Norma testified that they made
it clear to Dain that the 2110 property was to be restored to the
4 joint tenancy with Norma once he completed the project so that the
property could be added to the trust. Dain testified, though, that it
was always his intent to obtain a mortgage with Lynn and never
return the property to the joint tenancy with Norma.
¶ 10 Norma signed the quitclaim deed on February 18, 2016.
Norma did not receive consideration for this conveyance. On
February 23, 2016, Dain signed the quitclaim deed, so the property
was solely in his name. On that same day, Dain conveyed the
property as a joint tenancy with Lynn. On March 4, 2016, Dain
and Lynn acquired a mortgage on the 2110 property.3
¶ 11 Over the next several years after the conveyance, Dain’s
relationship with his parents significantly deteriorated.
¶ 12 Norma eventually filed a complaint to restore her as a joint
tenant of, and to remove Lynn from the title on, the 2110 property.
Norma asserted six claims against Dain and Lynn, including unjust
enrichment, promissory estoppel, breach of contract, constructive
3 Wells Fargo holds the note for Dain and Lynn’s mortgage with the
2110 property as collateral. Wells Fargo was originally named in the complaint. All parties entered into a stipulation acknowledging that Wells Fargo has a first position priority lien encumbered on the property and that, regardless of the quiet title action, Wells Fargo’s first position priority lien remains in effect.
5 trust, fraudulent inducement, and quiet title as to water rights.
Dain and Lynn counterclaimed, naming Richard as a third-party
defendant and asserting four claims including quiet title,
declaratory judgment, breach of contract, and conversion. At some
point after Norma’s complaint was filed, Dain broke into his
parents’ home and stole most of Norma’s records relating to the
2110 property. The records were later provided to Norma and
Richard as part of the discovery process.
¶ 13 After a four-day bench trial, the district court issued a detailed
order on November 22, 2022 (November 2022 order). The district
court found that the deed conveying the 2110 property to Dain was
a valid transfer, so Norma’s claims for breach of contract,
constructive trust, promissory estoppel, and fraudulent inducement
failed. The court, however, found that Dain was unjustly enriched
by keeping the property solely in his name because Norma signed
the quitclaim deed for no consideration. The court entered a
judgment in favor of Norma for $240,390 for her share of the
property as a former joint tenant.
¶ 14 As pertinent to this appeal, the district court also found that
the water rights to the 2110 property were not transferred by the
6 2016 quitclaim deed signed by Norma and that such rights
remained held in joint tenancy by Dain and Norma.
¶ 15 The court stated that the warranty deed from Noren conveying
the property to Dain and Norma included language that conveyed
“all water, water rights, ditches and ditch rights appurtenant
thereto,” but the 2016 quitclaim deed from Norma to Dain did not
include this language. The court determined that Norma’s
conveyance was intended to be a short-term transfer so Dain could
obtain a loan, that the parties did not discuss water rights when the
conveyance occurred, and that there was insufficient evidence
presented of any intent to convey water rights.
¶ 16 On appeal, Dain and Lynn contend that the district court
erred by (1) holding that water rights related to the 2110 property
did not transfer solely to Dain on February 23, 2016; (2) failing to
determine that the water rights were incidental and necessary to
the 2110 property; and (3) infringing on Lynn’s rights by quieting
title of the water rights to Dain and Norma as joint tenants.
II. Jurisdiction
¶ 17 Initially, Dain and Lynn filed a notice of appeal seeking review
of the district court’s November 2022 order. Norma and Richard
7 filed a cross-appeal. The appeal and cross-appeal were dismissed
by this court without prejudice because we lacked a final
appealable order.
¶ 18 In February 2023, Norma and Richard then filed motions in
the district court requesting that the court issue (1) a decree
quieting title to all water rights related to the 2110 property to Dain
and Norma as joint tenants; (2) an order on their bill of costs; and
(3) an order determining prejudgment interest owed to Norma for
her judgment of $240,390 entered as part of the November 22
order. After briefing on the motions, the district court issued on
September 27, 2023: (1) a decree quieting title to the water rights
related to the 2110 property; (2) an order awarding Norma and
Richard their costs; and (3) an order awarding Norma $129,665.71
in prejudgment interest (September 2023 orders).
¶ 19 Norma and Richard contend that we lack jurisdiction to review
the court’s November 2022 order because Dain and Lynn’s (1)
second notice of appeal references only the September 2023 orders
and (2) second appeal was untimely, as it was filed nearly a year
after the November 2022 order.
8 ¶ 20 We must independently determine our jurisdiction over an
appeal. People v. S.X.G., 2012 CO 5, ¶ 9. Subject to exceptions
inapplicable here, an appeal to this court may be taken only from a
final judgment. § 13-4-102(1), C.R.S. 2024; see also C.A.R. 1(a)(1);
People v. G.S., 2018 CO 31, ¶ 37.
¶ 21 To be a final appealable order, a judgment or order must
address both liability and damages. Chavez v. Chavez, 2020 COA
70, ¶ 28. Because prejudgment interest is a component of a
damages award, “a judgment awarding prejudgment interest is
not final until the amount of such interest is reduced to a sum
certain.” Stone Grp. Holdings LLC v. Ellison, 2024 COA 10, ¶ 23
(quoting Grand Cnty. Custom Homebuilding, LLC v. Bell, 148 P.3d
398, 401 (Colo. App. 2006)).
¶ 22 If, however, prejudgment interest can be calculated on the face
of the judgment, calculation of the interest is a “ministerial” task,
rendering the judgment final for purposes of appeal. Id. at ¶¶ 25-
26. But for prejudgment interest to be reduced to a sum certain,
the order must include “(1) the amount of the judgment; (2) the
interest rate; and (3) the date on which accrual of prejudgment
interest begins.” Id. at ¶ 26.
9 ¶ 23 At the time Dain and Lynn filed their first notice of appeal, the
November 2022 order was not final because, although it set forth
the judgment amount of $240,390, it did not identify the interest
rate or the date prejudgment interest would begin to accrue.
Therefore, the November 2022 order was not final under the test in
Stone Group Holdings, which is why this court dismissed the first
appeal for lack of a final appealable order; the court’s judgment,
however, became final with the September 2023 order that reduced
the prejudgment interest award to a sum certain; therefore, the
second notice of appeal was timely filed. And because the district
court incorporated its November 22 order into the September 23
decree, our review includes the November 2022 and September
2023 orders.
III. Standard of Review
¶ 24 “When a court enters a judgment following a bench trial, that
judgment presents a mixed question of law and fact.” State Farm
Mut. Auto. Ins. Co. v. Johnson, 2017 CO 68, ¶ 12. Under the mixed
standard, “[f]indings of fact are generally reviewed under a clear
error or abuse of discretion standard, whereas conclusions of law
are generally reviewed under a de novo standard.” E-470 Pub.
10 Highway Auth. v. 455 Co., 3 P.3d 18, 22 (Colo. 2000). We may
consider the “ultimate conclusion as one of fact for purposes of
review and apply the clear error standard.” Id. In this case, the
district court made factual findings intertwined with conclusions of
law based on the testimony of the parties.
IV. Analysis
¶ 25 Dain and Lynn raise three arguments to support that Norma
transferred the water rights associated with the 2110 property to
Dain’s sole ownership: (1) the express terms of the quitclaim deed
transferred the water rights; (2) the water rights are incidental and
necessary to the 2110 property; and (3) the court’s September 2023
orders infringe on Lynn’s rights. We reject all three arguments.
1. Express Terms
¶ 26 Dain and Lynn contend that the water rights were transferred
to Dain’s sole ownership based on the 2016 quitclaim deed’s
express language that conveyed the property and all its
appurtenant rights. Dain and Lynn refer to the following clause:
TO HAVE AND TO HOLD same unto Grantees, together with all and singular the appurtenances and privileges thereunto belonging or in anywise thereunto appertaining, and all the estate, right, title,
11 interest and claim whatsoever, of the Grantor, either in law or equity, to the only proper use, benefit and behoof of the grantees, their heirs and assigns forever.
Thus, Dain and Lynn assert, Norma and Dain’s intent as co-
grantors was to convey all “right, title, interest, and claim
whatsoever” to the 2110 property to the “only proper use” and
benefit of Dain, which included the water rights.
¶ 27 In Colorado, water rights are separate from the interests in
land. See Bd. of Cnty. Comm’rs v. Park Cnty. Sportsmen’s Ranch,
LLP, 45 P.3d 693, 707 (Colo. 2002) (“[N]either surface water, nor
ground water, nor the use rights thereto, nor the water-bearing
capacity of natural formations belong to a landowner as a stick in
the property rights bundle.”); see also Travelers Ins. Co. v. Janitell
Farms, Inc., 609 P.2d 1116, 1117 (Colo. App. 1980) (“[A] water right
is a property right separate and apart from the land on which it is
used . . . . The land for which it was appropriated or on which it
has been used may be conveyed or held without the water, and the
water may be conveyed or held without the land.” (quoting Nielson
v. Newmyer, 228 P.2d 456, 458 (Colo. 1951))). Thus, “[o]nce
acquired, water rights may be transferred separately from the
12 property itself.” WRWC, LLC v. City of Arvada, 107 P.3d 1002, 1005
(Colo. App. 2004); see also Humphrey v. Sw. Dev. Co., 734 P.2d 637,
640 (Colo. 1987).
¶ 28 To convey water rights, “the same formalities shall be observed
and complied with as in the conveyance of real estate.” § 38-30-
102(2), C.R.S. 2024. It has long been the law in Colorado that
water rights are determined by the express terms of the deed that
purportedly transfers the rights. Wanamaker Ditch Co. v. Crane,
288 P.2d 339, 343 (Colo. 1955).
¶ 29 The 2005 warranty deed conveying the 2110 property in joint
tenancy to Noren, Dain, and Norma had language that the
conveyance included “all water, water rights, ditches and ditch
rights appurtenant thereto.” But the 2016 quitclaim deed that
conveyed the property from a joint tenancy between Norma and
Dain to Dain’s sole possession did not include that same language.
See Nielson, 228 P.2d at 458 (“The land for which it was
appropriated or on which it has been used may be conveyed or held
without the water, and the water may be conveyed or held without
the land, or any part of the land may be conveyed together with any
part of the water right and the remainder be retained.”) (citation
13 omitted). Therefore, given the title history for the 2110 property,
the district court did not err when it looked at the prior conveyance
documents and concluded that, if water rights were intended to be
transferred, the 2016 quitclaim deed could have expressly said so.
In other words, the 2005 warranty deed executed by Noren included
the water rights, and therefore, the parties knew how to convey
those rights but chose not to do so in the 2016 quitclaim deed. See
Fox v. 1-10, Ltd., 936 P.2d 580, 582-83 (Colo. App. 1998) (as part of
a contract interpretation analysis, finding that parties knew how to
exempt certain provisions of a partnership agreement’s amendment
procedures, while they intentionally “chose not to” exempt others),
aff’d, 957 P.2d 1018 (Colo. 1998). Nonetheless, Dain contends, and
we agree, that in certain circumstances, transfer of the property
and the appurtenances can include transfer of the water rights.
Whether water rights are appurtenant to the land, however, “is
generally a question of fact, as is also whether on a sale or transfer
of the land, the water right passes as an appurtenance.” Travelers
Ins. Co., 609 P.2d at 1118 (citing Denver Joint Stock Land Bank v.
Markham, 107 P.2d 313 (Colo. 1940)). “Where, in conveyance of
land a part only of the appurtenant water right is described and
14 specified as being conveyed therewith, such specific designation
destroys any presumption of intention to convey the remainder.”
Nielson, 228 P.2d at 458-59.
¶ 30 In considering the testimony of all parties, the district court
determined that the transfer was intended to be temporary so Dain
could obtain a loan and that the parties did not discuss the transfer
of water rights. Because of the short-term nature of the
transaction, it was reasonable to infer that the parties had not
discussed the water rights. This inference is supported by Dain’s
affidavit stating that, at the time of the conveyance, he “did not
understand that ownership of water rights could be separate from
ownership of the land.”
¶ 31 Nonetheless, Dain contends that he testified at trial that his
intent was to transfer the entirety of the 2110 property interest to
his sole possession and then put Lynn’s name on the title. He says
this makes sense because he was estranged from his parents and
because his sister has her own property from the trust so he should
have one as well. But Dain and Lynn did not certify transcripts
from the bench trial on appeal, and therefore, we must presume
15 that the court’s judgment was correct. See People v. Duran, 2015
COA 141, ¶ 21.
¶ 32 And regardless, the November 2022 order made credibility
determinations and weighed the conflicting evidence and testimony
about the parties’ intent surrounding the 2016 quitclaim deed. The
court reasoned that “it is more likely than not that Dain was
intentionally vague about any promises or agreements he was
making so that his mother would take her name off the Property
and give the Property solely to him.” Credibility determinations are
within the sole province of the fact finder, and we may not reweigh
the evidence or substitute our judgment for that of the district
court. See Target Corp. v. Prestige Maint. USA, Ltd., 2013 COA 12,
¶ 24.
¶ 33 Dain and Lynn also contend that the water rights for the
Barrett Ditch and Barrett Pond were severed in 1986, which would
mean that he owned the water rights to Barrett Pond. Norma and
Richard claim this argument is unpreserved. But even if Dain and
Lynn made this argument in the summary judgment briefing, we do
not know how or if the argument was raised at trial because we lack
a transcript. See Duran, ¶ 21.
16 ¶ 34 Finally, Dain and Lynn contend that because the title history
transferring the water rights to his parents for the 2108 property
also contained a general reference to that land’s appurtenant rights,
the general language in the 2016 quitclaim deed likewise
transferred the water rights associated with the 2110 property. As
part of this argument, he and Lynn ask us to take judicial notice of
three deeds, attached to their opening brief, relating to the title
histories for the 2108 and 2110 properties.
¶ 35 These arguments were not raised below, and the documents
were not presented to the district court for its consideration.
Consequently, we decline to take judicial notice of documents, and
we will not review this argument further. See Laleh v. Johnson,
2016 COA 4, ¶ 8, aff’d on other grounds, 2017 CO 93.4
4 Other arguments Dain and Lynn assert on appeal but did not
raise below include the following: (1) Dain and Lynn own the “improvements” to the Barrett Pond and Barrett Ditch located on the 2110 property based on the improvements clause in the 2016 quitclaim deed, and (2) the title history for the 2110 property did not always provide a detailed description of the water rights being transferred. Consequently, we will not address them. See Laleh v. Johnson, 2016 COA 4, ¶ 8, aff'd on other grounds, 2017 CO 93.
17 2. Incidental and Necessary
¶ 36 Dain and Lynn next contend that the water rights must have
been transferred to his sole ownership because those rights are
incidental and necessary to the 2110 property. They continue that
the court made no findings about the incidental and beneficial use
of the water rights, necessitating that we remand to the district
court.
¶ 37 For support of Dain and Lynn’s incidental and necessary
arguments, they rely on a number of cases, including Kinoshita v.
N. Denver Bank, 508 P.2d 1264 (Colo. 1973); James v. Barker, 64
P.2d 598 (Colo. 1937); Hastings & Heyden Realty Co. v. Gest, 201 P.
37 (Colo. 1921); Shigo, LLC v. Hocker, 2014 COA 16.
¶ 38 These cases generally hold that water rights may be
appurtenant to the land (incidental) and, thus, transferred absent
any specific language in the deed
• when a court determines the intent of the parties “from all the
circumstances of the case, including the fact as to the use of
the water and whether it is necessary and essential to the
beneficial use and enjoyment of the land,” Kinoshita, 508 P.2d
18 at 1267 (quoting Hastings & Heyden Realty Co., 201 P. at 39);
see also Shigo, LLC, ¶ 13; or
• “if the presumptions arising from the circumstances of the
transaction make it appear that it was the intention of the
grantor that [the rights] should so pass,” James, 64 P.2d at
600; see also Hastings, 201 P. at 39.
Given the case law, the district court primarily focused on
Norma’s intent, as she was the grantor of the 2016 quitclaim deed.
We have previously discussed that Norma considered the
transaction to be a short-term deal and that the water rights were
never discussed. Again, without the benefit of a transcript, we
must presume the record supports the district court’s findings. See
Duran, ¶ 21.
¶ 39 As to whether the water rights are necessary for the beneficial
use and enjoyment of the 2110 property, Dain stated in his affidavit
that he used Barrett Pond to water his lawn, bushes, and shrubs
via an automatic sprinkler and that this is necessary because of the
arid climate where the 2110 property is located. Dain also stated
that he, Lynn, and their kids used Barrett Pond for recreation and
swimming.
19 ¶ 40 But the cases they cite all involve agricultural or irrigation
uses of the land, not recreational uses. See Kinoshita, 508 P.2d at
1265 (the owner conveyed farmland); Shigo, LLC, ¶¶ 3-6 (same);
Hastings, 201 P. at 40 (“It is also well established that without
water the land would be practically worthless for agricultural
purposes, and would have a value of only one-tenth the amount
paid to obtain its release. This fact is important as indicating the
intention to convey the water with the land . . . .”); James, 64 P.2d
at 600 (water was used for land irrigation). And we cannot find, nor
have the parties cited, authority holding that water rights used for
landscaping and recreation are necessary and incidental
appurtenances to the land so that, absent specific mention of the
water rights in a deed, they nonetheless transfer with the land.
¶ 41 And Dain and Lynn’s argument that Lynn and Norma cannot
use the well is not at issue in this case. As Dain and Lynn pointed
out, adjudication of water usage are issues exclusively determined
by a water court. Here, we are dealing with ownership of the water
rights. See Allen v. State, 2019 CO 6, ¶ 1. And because the well is
for domestic use only, Dain and Lynn could not use the well for
agricultural purposes.
20 ¶ 42 Accordingly, we conclude that the water rights are not
incidental and necessary to Dain and Lynn’s beneficial use and
enjoyment of the land.
3. Infringement of Rights
¶ 43 Dain and Lynn’s final contention is that the water decree
infringes on Lynn’s rights as a joint owner of the 2110 property.
Norma and Richard contend that this argument was not made
below and is therefore unpreserved. Even assuming Lynn’s “use” of
the water in Barrett Pond and Barrett Ditch is a “right” attached to
her property ownership, we cannot find any argument to that effect
made below, and again, the transcripts were not provided for our
review. Therefore, we conclude that this argument was not raised
below, and we will not address it further. See Laleh, ¶ 8.
V. Conclusion
¶ 44 The judgment is affirmed.
JUDGE FOX and JUDGE SCHOCK concur.