23CA1898 JKHP v Whipple 12-12-2024
COLORADO COURT OF APPEALS
Court of Appeals No. 23CA1898 Eagle County District Court No. 23CV30037 Honorable Paul R. Dunkelman, Judge
JKHP, LLC,
Petitioner-Appellant,
v.
Thomas M. Whipple; NBH Bank; W. Ryland Gardner, III; Teak J. Simonton, in her official capacity as County Treasurer of Eagle County,
Respondents-Appellees.
ORDER AFFIRMED AND CASE REMANDED WITH DIRECTIONS
Division V Opinion by JUDGE FREYRE Grove and Lum, JJ., concur
NOT PUBLISHED PURSUANT TO C.A.R. 35(e) Announced December 12, 2024
Spector Law, LLC, Joel M. Spector, Denver, Colorado; Hamre, Rodriguez, Ostrander & Prescott, P.C., Donald M. Ostrander, Englewood, Colorado, for Petitioner-Appellant
JVAM PLLC, Alexander C. Clayden, Lucas F. Van Arsdale, Quentin H. Morse, Glenwood Springs, Colorado, for Respondent-Appellee Thomas M. Whipple
No Appearance for Respondents-Appellees NBH Bank; W. Ryland Gardner, III; Teak J. Simonton, in her official capacity as County Treasurer of Eagle County ¶1 In this private condemnation action, petitioner JKHP, LLC,
appeals the district court’s dismissal of its petition to condemn a
private way of necessity across property owned by Thomas M.
Whipple. We affirm and remand the case for the district court to
determine and award Whipple his reasonable appellate attorney
fees and costs.
I. Background
A. The Properties
¶2 This case involves properties that are located on Taylor Hill in
Eagle County. JKHP owns two properties, the Joker Lode (Joker)
and the Logos Lode (Logos). Jason Provalenko is the manager of
JKHP. Whipple owns two properties, the Colorado Mint Lode
(Colorado Mint) and the Big Sunflower Lode (Big Sunflower). As
shown in the site map below, Whipple’s properties bisect the Joker
and Logos properties, creating four quadrants referred to as West
Joker, West Logos, East Joker, and East Logos. Ohio Boy Lode
(Ohio Boy) abuts West Joker and is located west of Colorado Mint.
1 ¶3 The properties are accessible from Colorado State Highway 24.
Forest Service Road 731, also known as Ten Five Drive, connects
with Highway 24. Ten Five Drive runs through a National
2 Monument,1 private property, West Joker, Colorado Mint, Big
Sunflower, East Joker, and East Logos where it then connects with
a spur that connects to Taylor Creek Road, thereby creating a loop.
Forest Service Road 731-1A, also known as Taylor Creek Road or
the Lower Road, is south of Ten Five Drive and runs directly
through the southern portion of Colorado Mint and Big Sunflower.
B. History of Property and Access
¶4 David Faulkenberg acquired title to Joker, Logos, Colorado
Mint, and Big Sunflower in 1980 and 1981. In 1982, Faulkenberg’s
family constructed a cabin on Big Sunflower now owned by
Whipple. To provide access to the cabin, Faulkenberg’s father
extended an existing road spur from a point near the property
between West Joker and Ohio Boy. That road is Ten Five Drive.
Ten Five Drive crosses over Taylor Hill private parcels to reach Ohio
Boy and West Joker, then runs easterly along West Joker and
crosses Colorado Mint, Big Sunflower, East Joker, and East Logos.
Ten Five Drive also crosses a sliver of United States Forest Service
1 The Forest Service Property surrounding the properties at issue
has been designated as a National Monument. 3 (USFS) property located between Ohio Boy and West Joker. This
sliver was unknown to the parties until 2022 when it was
discovered by Faulkenberg. The USFS has never challenged the use
of the sliver by any of the property owners.
¶5 Taylor Creek Road intersects with Ten Five Drive west of the
properties. It runs south and east across private property and
federal land managed by the USFS. It then crosses the southern
portions of Colorado Mint and Big Sunflower and another portion of
USFS land. The road then forks, and the left fork goes northeast
and crosses East Logos into East Joker.
¶6 In 1986, Faulkenberg conveyed Colorado Mint and Big
Sunflower to his sister and brother-in-law. In the conveyance deed,
Faulkenberg reserved access easements encompassing the existing
twenty-foot roadways at Ten Five Drive and Taylor Creek Road
burdening Colorado Mint and Big Sunflower and benefitting Joker
and Logos. These access easements are depicted in blue and green
on the site map below and run with the land. On the same date,
Faulkenberg conveyed Joker and Logos to himself and his wife. In
the conveyance deed, Faulkenberg reserved access easements
4 encompassing the existing twenty-foot roadways at Ten Five Drive
and Taylor Creek Road burdening Joker and Logos and benefitting
Colorado Mint and Big Sunflower. These access easements are
depicted in red in the site map below and also run with the land.
¶7 We will refer to these easements as the Faulkenberg
Easements.
¶8 In 2002, the previous owners of Joker, Logos, Colorado Mint,
Big Sunflower, and Ohio Boy executed and recorded a Reciprocal
Easement Deed (Easement Deed). The Easement Deed created a
legal and enforceable easement that runs with the land, in the 5 location of Ten Five Drive, and runs across Colorado Mint and Big
Sunflower, for access to the Joker and Logos properties. It also
created a legal and enforceable easement that runs with the land, in
the location of Taylor Creek Road, and runs across Colorado Mint
and Big Sunflower, for access to the Joker and Logos properties.
C. Road Variance and Special Use Permit
¶9 In 2017, Provalenko and other property owners in the Taylor
Hill area sought a road variance to facilitate the construction of
residential improvements on their properties. The variance
requested the allowance of roads steeper than the grades
recommended in the Eagle County Land Use Regulations. The Eagle
County Board of County Commissioners granted a “Variance from
Improvement Standards” (Resolution No. 2017-82) conditioned on
the applicants obtaining approval from the USFS for the use of Ten
Five Drive on its property to access private property in the Taylor
Hill neighborhood.
¶ 10 Provalenko, on behalf of the Taylor Hill Equitable Road Users
Group (THERUG), submitted an “Application for Transportation and
Utility Systems and Facilities on Federal Lands,” seeking an
6 easement from the federal government for ingress, egress, and road
maintenance encompassing Ten Five Drive on USFS property. The
USFS granted THERUG’s application, including a private road
special use permit (SUP). In the SUP, the USFS granted THERUG
the right to use and maintain “the existing road (Ten Five Drive) in
current condition, without any expansion, enhancement, or other
improvements, strictly ‘as is, where is’ to access members’ private
inholding parcels.”
D. Events Preceding Immediate Possession Hearing
¶ 11 On February 10, 2023, JKHP, through counsel, sent a letter to
Whipple’s counsel with an offer to acquire a nonexclusive easement
over the southern portion of Whipple’s property near Taylor Creek
Road. Using the 2022 tax assessor’s data, JKHP valued the raw
land on Colorado Mint at $11,228 per acre and the raw land on Big
Sunflower at $12,368 per acre and determined that the value of the
easement was $8,652. However, “to avoid potentially expensive and
time-consuming litigation,” JKHP offered Whipple $20,000 for the
easement. Whipple did not reply to the offer. JKHP then filed this
private condemnation action seeking to condemn the bottom
7 portion of Whipple’s property to create a series of switchbacks
(shown in the illustration below), starting in the southwest corner of
Colorado Mint where Taylor Creek Road enters Whipple’s property
and across Big Sunflower, to provide access to West and East Logos
from Taylor Creek Road. JKHP also requested immediate
possession.
E. Immediate Possession Hearing
¶ 12 At the immediate possession hearing, the district court heard
testimony from Provalenko, Whipple, David Faulkenberg, and other
witnesses, and it received numerous exhibits. In a detailed written 8 order, the court denied immediate possession, dismissed JKHP’s
petition in condemnation without prejudice, and awarded Whipple
reasonable attorney fees and costs.
¶ 13 Concerning credibility, the court found Provalenko’s testimony
“lacking in credibility and unpersuasive.” In doing so, it noted two
other lawsuits involving the parties and access to the properties,
the parties’ contentious history, and Provalenko’s lack of diligence
in seeking less intrusive options. Thus, it found it could not make
findings of necessity based solely on Provalenko’s testimony. The
district court noted the same credibility concerns with Whipple’s
testimony, but acknowledged the impact of that finding was
different since Provalenko had the initial burden of proof.
¶ 14 Turning to the remaining evidence, the district court first
found that the jurisdictional prerequisite of “failure to agree,” which
requires “good faith negotiations,” was satisfied by Provalenko’s
offer to purchase the easement from Whipple and Whipple’s
non-response to the offer. The parties do not contest this finding.
¶ 15 Next, the court found that private ways of necessity satisfy the
public purpose requirement, and that, subject to proving necessity,
9 the proposed condemnation furthered a public use and public
purpose by providing access for residential and agricultural
development on Provalenko’s properties.
¶ 16 Concerning the remaining evidence of necessity and need for
immediate possession, the court found that JKHP’s action was
premature and that JKHP had not proved necessity. First, it noted
that private ways of necessity constitute a “remedy of last resort”
and that JKHP’s properties were not landlocked. Then, relying on
the Faulkenberg Easements and the Easement Deed, the court
found that JKHP has legal access to its properties in the form of
easements over Ohio Boy, Colorado Mint, and Big Sunflower, and
legal access to West Logos through USFS property off Taylor Creek
Road, even if no road currently exists. Moreover, the court could
not find, based on Provalenko’s testimony, that a private way of
necessity was reasonably necessary under the facts and
circumstances of the case. It noted that JKHP had not taken the
steps necessary to show that the existing access was not acceptable
and could not be made acceptable by working with the County and
the USFS.
10 ¶ 17 On appeal, JKHP contends that the district court erred by (1)
shifting the burden of proof; (2) requiring prerequisites to
condemnation; and (3) dismissing the case without prejudice
instead of simply denying the motion for immediate possession. We
address and reject each contention.
II. Necessity and Burden of Proof
¶ 18 JKHP first contends that the district court improperly shifted
the burden of proving the existence of alternate access, and that the
record shows there are no acceptable alternate access routes to
JKHP’s property. We disagree and conclude that the court found
JKHP did not prove necessity.
A. Standard of Review and Applicable Law
¶ 19 In condemnation proceedings, we defer to the district court’s
findings of fact unless they are so clearly erroneous as to find no
support in the record. Fowler Irrevocable Trust 1992-1 v. City of
Boulder, 17 P.3d 797, 802 (Colo. 2001). We review its legal
conclusions de novo. Id. In private condemnation proceedings,
necessity is a question of fact. See Crystal Park Co. v. Morton, 146
P. 566, 572 (Colo. App. 1915).
11 ¶ 20 Under the Colorado Constitution, “[p]rivate property shall not
be taken for private use unless by consent of the owner, except for
private ways of necessity . . . .” Colo. Const. art. II, § 14; see also
§ 38-1-102(3), C.R.S. 2024. A way of necessity “is similar in
character to an easement” and “creates a property right to enter
and use another’s land for a specific purpose.” Glenelk Ass’n v.
Lewis, 260 P.3d 1117, 1121 (Colo. 2011). Specifically, a way of
necessity is a passageway or roadway that provides “legal access
connecting landlocked property to a public road.” Akin v. Four
Corners Encampment, 179 P.3d 139, 144 (Colo. App. 2007); see also
West v. Hinksmon, 857 P.2d 483, 486 (Colo. App. 1992) (Private
ways of necessity “include ways for reasonable and practical access
to property otherwise isolated.”). Condemnation of a private way of
necessity is a “remedy of last resort.” State Dep’t of Highways v.
Denver & Rio Grande W. R.R. Co., 789 P.2d 1088, 1091 (Colo. 1990).
¶ 21 Further, because condemnation of a private way of necessity is
in derogation of private property rights, courts “strictly construe
private condemnation law against the condemnor.” Glenelk Ass’n,
260 P.3d at 1121. Any uncertainties or ambiguities in the law or
12 regarding the scope of the power to condemn must be resolved in
favor of the condemnee landowner. Id. at 1120; Akin, 179 P.3d at
144.
¶ 22 In a private condemnation action, the prospective condemnor
must prove a necessity for the proposed easement. Glenelk Ass’n,
260 P.3d at 1121-22; Tieze v. Killam, 179 P.3d 10, 13 (Colo. App.
2007). A private condemnation is necessary if it is “indispensable
to the practical use of the property for which [it is] claimed.”
Glenelk Ass’n, 260 P.3d at 1123 (quoting Crystal Park Co., 146 P. at
569). The condemnor’s necessity need not be absolute, but the way
must be “reasonably necessary under the facts and circumstances
of the case.” West, 857 P.2d at 487 (potential condemnor proved
necessity because property was landlocked without public ingress
or egress); see also Tieze, 179 P.3d at 13 (potential condemnor
proved necessity because property was approved for residential use
and was landlocked).
¶ 23 Once a prospective condemnor establishes necessity for a
private way of access, the party seeking to avoid condemnation
must prove an alternate route exists, and the potential condemnors
13 have a present enforceable right to use it. Glenelk Ass’n, 260 P.3d
at 1122; Tieze, 179 P.3d at 13.
B. Analysis
¶ 24 We conclude the district court did not improperly shift the
burden of proof to JKHP because JKHP failed to prove necessity. “If
a prospective condemnor possesses an enforceable right to use an
accessible alternate route of access then [the] condemnor cannot
establish necessity.” Glenelk Ass’n, 260 P.3d at 1122.
¶ 25 While Provalenko testified that he intended to use the private
access to develop his property for both residential and agricultural
purposes and that the equipment necessary to further such
development could not travel on the existing roads, he presented
nothing beyond his testimony to establish these facts. And given
the court’s credibility findings, we may not consider this testimony.
See Mariani v. Rocky Mountain Hosp. & Med. Serv., 902 P.2d 429,
436 (Colo. App. 1994), aff’d, 916 P.2d 519 (Colo. 1996).
¶ 26 Additionally, Provalenko testified that a portion of Ten Five
Drive has a twenty-eight percent grade and does not meet Eagle
County’s Land Use Regulations. However, Provalenko did not
14 present any evidence from Eagle County that the road was
unacceptable. Moreover, the record shows that Provalenko
previously sought and obtained a grade variance from the County
and the USFS, and that he has taken no steps to determine
whether such variances can be obtained for the existing roads.
Again, we may not consider his testimony or substitute our
judgment for the district court’s. See Target Corp. v. Prestige Maint.
USA, Ltd., 2013 COA 12, ¶ 24 (“We may not . . . substitute our
judgment for the trial court’s.”).
¶ 27 Similarly, Provalenko testified that he lacked access to East
Joker and East Logos via Ten Five Drive because the road crosses a
sliver of USFS land. But Provalenko did not present any evidence
that the USFS actually owns the land or that it objected to
Provalenko’s use of Ten Five Drive. To the contrary, the record
shows that Provalenko and Whipple regularly traversed Ten Five
Drive without objection by the USFS.
¶ 28 We are not persuaded otherwise by JKHP’s reliance on Tieze or
West because in both cases, the condemnor’s property was
landlocked and no legal access existed. In contrast, the
15 nontestimonial record here shows that access to the East Joker and
East Logos properties via Ten Five Drive and Taylor Creek Road
across Whipple’s property has existed since the 1980s. It also
shows that Provalenko owns and accesses a small cabin on West
Logos from the house he constructed on West Joker. While JKHP
claims Provalenko’s unrebutted testimony shows that it would be
impractical to access West Logos via Taylor Creek Road or to
construct a road from West Joker to West Logos, the district court
declined to credit Provalenko, so we may not consider this
unrebutted testimony. Mariani, 902 P.2d at 436. Moreover, we are
not convinced that the land use regulations themselves, without
more, establish impracticality, particularly given record evidence
showing a previous variance grant and a willingness by the USFS to
work with the Taylor Hill property owners.
¶ 29 Finally, Provalenko offered no other evidence, beyond his
testimony, to show that his property is inaccessible. Therefore, we
agree with the district court that JKHP failed to establish necessity
and thus, that the district court did not need to address whether
Whipple had shown that an acceptable alternate route of access
16 exists. And because necessity was not proven, we further conclude
that any error in the court’s application of the burden of proof
beyond necessity is harmless.
¶ 30 Accordingly, we affirm the court’s ruling.
III. Prerequisites to Condemnation
¶ 31 JKHP next contends that the district court erroneously (1)
required JKHP to seek permits and variances from governmental
authorities as a prerequisite to condemnation, and (2) failed to
properly apply Glenelk Ass’n by requiring it to file a building
application as a prerequisite to condemnation. We are not
persuaded.
¶ 32 In condemnation proceedings, we review legal conclusions de
novo. Fowler Irrevocable Trust 1992-1, 17 P.3d at 802. Necessity is
a question of fact. Glenelk Ass’n, 260 P.3d at 1120. The district
court’s findings of fact are reviewed for clear error. Id. A district
court’s factual finding is clearly erroneous if it lacks record support.
In re Parental Responsibilities Concerning S.Z.S., 2022 COA 105, ¶
11.
17 B. Analysis
¶ 33 JKHP contends that the district court erred by requiring JKHP
to seek alternate access, including asking the USFS and the County
about access from Taylor Creek Road, and to be denied such access
as a prerequisite to condemnation. We disagree because the record
shows that the district court considered JKHP’s failure to engage
with any of the relevant governmental authorities as part of the
factual reasons for finding that it failed to prove necessity. Indeed,
Colorado courts consider the position of governmental authorities in
determining whether a condemnation may proceed. See Glenelk
Ass’n, 260 P.3d at 1119-24 (considering Jefferson County’s
determination on the proposed condemnation and concluding that
the petitioner failed to meet his burden because he failed to
sufficiently engage the County land use approval process prior to
initiating the condemnation proceeding); Tieze, 179 P.3d at 13
(considering Summit County’s determination on the proposed
condemnation). Therefore, we reject JKHP’s assertion that the
court required it to seek alternate access as a prerequisite to
condemnation and instead, view the court’s mention of JKHP’s
18 decision not to engage government agencies as a factual finding
that weighed against a finding of necessity.
¶ 34 We apply the same reasoning to JKHP’s argument that the
district court erroneously required it to submit a building
application with Eagle County as a prerequisite to condemnation.
JKHP relies on Glenelk Ass’n to argue that it demonstrated a
purpose for the condemnation through Provalenko’s testimony that
he intended to build a house on East Logos. See Glenelk Ass’n, 260
P.3d at 1119 (“[W]hen a petitioner seeks to condemn a private way
of necessity for access to property it wishes to develop in the future,
it must demonstrate a purpose for the condemnation that enables
the trial court to examine both the scope of and necessity for the
proposed condemnation, so that the burden imposed on the
condemnee’s property may be ascertained and circumscribed
through the trial court’s condemnation order.”). But we conclude
that Glenelk Ass’n supports the court’s ruling. In Glenelk Ass’n, the
supreme court affirmed the district court’s dismissal of the
condemnation petition and found that the petitioner failed to prove
necessity by presenting a vague and undefined concept for
19 development without sufficiently engaging the land use approval
process. Id. at 1119-20.
¶ 35 Here, the only evidence of future development came from
Provalenko’s testimony, which the court declined to credit. And
contrary to JKHP’s argument, the court’s order did not require a
building permit as a prerequisite to condemnation, but instead,
showed that the absence of any attempt to acquire such a permit
weighed against a finding of necessity.
¶ 36 Finally, we are not persuaded that the court erred in finding
that JKHP failed to do its due diligence. The court found that
Provalenko’s testimony lacked credibility. Therefore, its findings
that Provalenko lacked concrete development plans, despite his
testimony to the contrary, is supported by the record.
IV. Dismissal of Case
¶ 37 JKHP last contends that the district court erroneously
dismissed the case without prejudice rather than denying the
motion for immediate possession. We disagree.
¶ 38 In condemnation proceedings, we review legal conclusions de
novo. Fowler Irrevocable Trust 1992-1, 17 P.3d at 802. A private 20 condemnation action is a special statutory proceeding that must be
conducted in accordance with the eminent domain statutes. Bly v.
Story, 241 P.3d 529, 534 (Colo. 2010). It proceeds in two parts: (1)
an immediate possession hearing, and (2) a valuation trial. See Bd.
of Cnty. Comm’rs v. DPG Farms, LLC, 2017 COA 83, ¶ 4.
¶ 39 Section 38-1-105(6)(a), C.R.S. 2024, governs the immediate
possession hearing and provides in relevant part:
At any stage of such new proceedings or of any proceedings under this article, the court, by rule in that behalf made, may authorize the petitioner, if already in possession, to use, and, if not in possession, to take possession of and use, said premises during the pendency and until the final conclusion of such proceedings and may stay all actions and proceedings against such petitioner on account thereof, if such petitioner pays a sufficient sum into court, or to the clerk thereof, to pay the compensation in that behalf when ascertained.
¶ 40 Thus, the court must determine whether the petitioner is
entitled to immediate possession and if so, the amount of the
deposit to be posted.
21 ¶ 41 Other statutes relevant to immediate possession include
sections 38-1-109, C.R.S. 2024, and 38-1-105(1). Section 38-1-109
provides, in relevant part:
[A]t the hearing provided for in section 38-1-105, the court shall hear and dispose of all objections that may be raised touching the legal sufficiency of the petition or cross petition or the regularity of the proceedings in any other respect.
¶ 42 Further, section 38-1-105(1) states that “[t]he court shall hear
proofs and allegations of all parties interested touching the
regularity of the proceedings and shall rule upon all objections
thereto.”
¶ 43 When a motion for immediate possession is denied on grounds
that go to “the core” of the asserted right to condemn, dismissal of
the case is proper. Coquina Oil Corp. v. Dist. Ct., 623 P.2d 40, 42
(Colo. 1981).
¶ 44 We conclude that the district court properly applied the
condemnation statute in dismissing the petition. The court found
that JKHP was not authorized to condemn a private way of
necessity. In doing so, the court “hear[d] and dispose[d] of all
22 objections that may be raised touching the legal sufficiency of the
petition.” § 38-1-109; see also Shaklee v. Dist. Ct., 636 P.2d 715,
718 (Colo. 1981) (vacating the district court’s immediate possession
order entered without considering the public use and necessity
issues and holding that the district court needed to resolve all
issues before awarding immediate possession); Glenelk Ass’n, 260
P.3d at 1119-20 (affirming the district court’s dismissal of the
petition when petitioner failed to prove necessity). And because the
district court’s ruling went to “the core” of JKHP’s asserted right to
condemn, dismissal without prejudice was proper. Coquina Oil
Corp., 623 P.2d at 42.
V. Attorney Fees
¶ 45 Whipple requests his attorney fees under C.A.R. 39 and 39.1,
and section 38-1-122(1), C.R.S. 2024.
¶ 46 Section 38-1-122(1) provides:
If the court finds that a petitioner is not authorized by law to acquire real property or interests therein sought in a condemnation proceeding, it shall award reasonable attorney fees, in addition to any other costs assessed, to the property owner who participated in the proceedings.
23 ¶ 47 A respondent who successfully defends a failed condemnation
hearing on appeal is also entitled to their appellate attorney fees.
Akin, 179 P.3d at 147-48.
¶ 48 Additionally, C.A.R. 39.1 provides the appellate court with the
discretion to determine the amount of an award for attorney fees on
appeal or to remand for a determination of those issues by the
district court. Accordingly, we exercise our discretion and remand
the case to the district court to determine and award Whipple his
reasonable costs and attorney fees on appeal.
VI. Disposition
¶ 49 The order is affirmed, and the case is remanded for the district
court to determine and award Whipple his reasonable appellate
attorney fees and costs.
JUDGE GROVE and JUDGE LUM concur.