23CA2047 Johnson v Ortiz 11-21-2024
COLORADO COURT OF APPEALS
Court of Appeals No. 23CA2047 Adams County District Court No. 21CV31285 Honorable Teri L. Vasquez, Judge
Neolia Johnson,
Plaintiff-Appellee,
v.
Estate of Carlos Ortiz,
Defendant-Appellee,
and
Carol Adams,
Intervenor-Appellant.
ORDER AFFIRMED
Division VII Opinion by JUDGE SCHUTZ Tow and Pawar, JJ., concur
NOT PUBLISHED PURSUANT TO C.A.R. 35(e) Announced November 21, 2024
O’Brien Law Firm, LLC, Shauna O’Brien, Lafayette, Colorado, for Plaintiff- Appellee
Gantenbein Law Firm LLC, Keith Gantenbein, Christopher Turner, Christoper Pike, Denver, Colorado, for Defendant-Appellee
Law Office of Gary D. Fielder, Gary D. Fielder, Denver, Colorado, for Intervenor- Appellant ¶1 Intervenor, Carol Adams, appeals the district court’s order
approving the settlement agreement between plaintiff-appellee,
Neolia Johnson, and defendant-appellee, the Estate of Carlos Ortiz
(the Estate). We affirm the district court’s order.
I. Background and Procedural History
A. The Initial Partition Proceedings
¶2 Johnson’s husband and Ortiz’s wife were siblings. A few years
after their spouses died, Johnson and Ortiz agreed to cohabit in a
single-family residence in Westminster (property). At the time, Ortiz
owned the property.
¶3 In 1994, Ortiz placed a lien on the property as collateral to
secure a bond posted on his son’s behalf. The bond was later
forfeited. Ortiz feared he would lose the property because of the
default. Thereafter, Ortiz and Johnson obtained a loan to satisfy
the lien associated with the bond. To secure that loan, Johnson
was made a co-owner of the property, and she subsequently
contributed to the mortgage and other home expenses.
¶4 Around 2020, Johnson decided to move out of the property.
She commenced this partition action against Ortiz in 2021 after the
parties could not reach an agreement about how their interests in
1 the property would be divided. In 2023, Ortiz died. Adams is
Ortiz’s daughter. After his death, she produced his purported will.
Adams is one of two identified beneficiaries in the will.1
B. The Probate Proceedings and Settlement Agreement
¶5 In March 2023, Johnson filed a petition for the adjudication of
intestacy and moved to appoint the Public Administrator of the
Seventeenth Judicial District, Christopher Turner, as the Estate’s
personal representative. Adams objected to Turner’s appointment.
In view of her status as an asserted beneficiary of the Estate,
Adams requested that she be substituted for Ortiz as the defendant
and counterclaimant in the present action. The district court
denied the motion. The court instead issued an order substituting
the Estate for Ortiz and set a hearing to determine whether Adams
should nonetheless be permitted to intervene in this case pursuant
to C.R.C.P. 24.
1 The validity of Ortiz’s will was contested in Adams County Case
No. 23PR30205. The probate matter was not resolved when the district court issued its order approving the settlement agreement.
2 ¶6 At the hearing, neither Johnson nor the Estate objected to
Adams’s intervention. The court then set the matter for a three-day
jury trial in October.
¶7 Adams subsequently moved to dismiss the Estate’s legal
counsel and Turner on the basis that their representation was
unnecessary because she was the personal representative for her
father’s estate. The district court denied both motions after finding
that Adams had asserted no factual or legal basis for the requested
relief.
¶8 Adams asserted no affirmative claims for relief in the action.
Nevertheless, she participated in the preparation of the case
management and trial management orders. In the trial
management order, Adams set forth her factual contentions and
what she thought would be an appropriate resolution of the
partition action. Therein, Adams also stipulated that she was “not
an owner of the property” and that she claimed an interest in the
property only “as a beneficiary of the [E]state.”
¶9 At the trial management conference, Johnson and the Estate
informed the court that they had reached a settlement that resolved
all outstanding claims between them. Adams did not approve of the
3 settlement. The district court ordered Johnson and the Estate to
file a motion to approve the settlement and allowed Adams to file
any objection within seven days.
¶ 10 Johnson and the Estate timely filed their motion to approve
the settlement of their claims. The settlement apportioned 70.5% of
the property’s equity to the Estate and 29.5% to Johnson. Adams
timely objected to the proposed settlement and asked the court to
proceed with the trial.
• The Estate claimed at least a 75% ownership interest in the
property, and the corresponding right to receive 75% of the net
proceeds from the property’s sale.
• Johnson claimed at least a 25% ownership interest in the
property and the right to 50% of any proceeds from its sale
based on her ownership interests and past mortgage
payments.
• If the partition case proceeded to trial, the Estate was likely to
incur additional attorney fees in the amount of $39,000
($10,000 per trial day and $9,000 for trial preparation).
• The additional fees would result in a reduction in the amounts
available to distribute to the Estate’s beneficiaries, including
4 Adams, and therefore, settlement was in the best interest of
the Estate and its beneficiaries.
• Adams’s status as a beneficiary did not give her an ownership
interest in the property and she had asserted no claims for
relief against Johnson.
• Adams was not a real party in interest to the partition action
and she had no legal basis to object to the settlement.
¶ 11 In her response, Adams asserted that Johnson engaged in
fraudulent conduct, the breakup between Johnson and Ortiz was
“unfair,” and the attorneys representing Johnson and the Estate
had a conflict of interest because they had worked together on other
cases.
¶ 12 The district court approved the settlement agreement and
vacated the trial. The court largely adopted the arguments asserted
by Johnson and the Estate, concluding that (1) Adams had no
ownership interest in the property and no direct claims against
Johnson; (2) Adams’s rights as a potential beneficiary of the Estate
were adequately protected by the personal representative; and
(3) the settlement agreement was in the best interest of the Estate
and any of its beneficiaries, including Adams.
5 ¶ 13 On appeal, Adams contends that the district court erred by
approving the settlement agreement over her objection because her
status as an intervenor gave her the same rights as the original
parties, including the right to reject the settlement agreement.
Adams also argues that the district court violated her due process
rights by not allowing the matter to proceed to trial.
II. Approval of the Settlement Agreement
¶ 14 Adams contends that her status as an intervenor gives her the
same rights as the original parties, and therefore the district court
erred when it accepted the settlement agreement over her objection.
We disagree.
A. Preservation and Standard of Review
¶ 15 The Estate contends that Adams’s claims are unpreserved
because she failed to file any meaningful pleadings in the district
court. However, we conclude that Adams adequately preserved her
claim through her objection to the proposed settlement. People v.
Tallent, 2021 CO 68, ¶ 12 (To preserve a claim for appeal, a party
must make an objection “specific enough to draw the trial court’s
attention to the asserted error.”) (citation omitted).
6 ¶ 16 Because determining the rights of an intervenor under
C.R.C.P. 24 presents a question of law, we review de novo Adams’s
contention that the district court erred by approving the settlement
agreement over her objection. See Feigin v. Alexa Grp., Ltd., 19 P.3d
23, 28 (Colo. 2001) (adopting de novo standard of review for
determining whether a district court erred by denying a motion to
intervene as a matter of right). However, we review the district
court’s approval of the term of a settlement agreement for an abuse
of discretion. See Thomas v. Rahmani-Azar, 217 P.3d 945, 947-48
(Colo. App. 2009) (applying the abuse of discretion standard
regarding the approval of a class action settlement). A court abuses
its discretion if its ruling is manifestly arbitrary, unreasonable, or
unfair, or is based on a misunderstanding or misapplication of the
law. Bd. of Cnty. Comm’rs v. DPG Farms, LLC, 2017 COA 83, ¶ 34.
B. Applicable Laws
1. Partition
¶ 17 A party with an interest in real property may bring a claim for
the division and partition of the property. § 38-28-101, C.R.S.
2024. All persons with any interest, whether it be direct, indirect,
beneficial, or contingent in such property must be made parties to
7 the action. § 38-28-102, C.R.S. 2024. The court must completely
adjudicate the rights of all parties to the property, § 38-28-103,
C.R.S. 2024, and may make any such orders that it deems
necessary “to promote the ends of justice to completely adjudicate
every question and controversy concerning the title, rights, and
interest of all persons . . . .” § 38-28-110, C.R.S. 2024.
2. Intervention
¶ 18 Rule 24 permits individuals to intervene in a matter as of right
or permissively. To intervene as of right the intervenor must show
(1) that a statute confers an unconditional right to intervene or
(2) that the intervenor claims an interest related to the property that
is the “subject of the action and [they are] so situated that the
disposition of the action may as a practical matter impair or impede
[their] ability to protect that interest, unless the [intervenor’s]
interest is adequately represented by existing parties.” C.R.C.P.
24(a).
¶ 19 If the intervenor cannot be added as of right, a court may still
allow for permissive intervention upon a showing that an
applicant’s “claim or defense and the main action have a question of
law or fact in common.” C.R.C.P. 24(b).
8 ¶ 20 An intervenor is not conferred party status simply by virtue of
their presence in a case. Harris v. Amoco Prod. Co., 768 F.2d 669,
675 (5th Cir. 1985). As the Court of Appeals for the Fifth Circuit
explained:
[A] permissive intervenor [falls] somewhere in the gray area between spectator and participant. . . . Generally, these grounds exist where, as here, the intervenor relies on having satisfied a conditional statutory right to intervene. However, the intervenor’s mere presence in an action does not clothe it with the status of an original party. To be sure, there are some senses in which an “intervenor is treated as if he were an original party and has equal standing with the original parties.” The permissive intervenor can, among other things, move to dismiss the proceeding and can challenge the subject matter jurisdiction of the district court. But these participatory rights remain subject to the intervenor’s threshold dependency on the original parties’ claims, for it is equally well-settled that “[a]n existing suit within the court’s jurisdiction is a prerequisite of an intervention, which is an ancillary proceeding in an already instituted suit.”
¶ 21 Id. (citations omitted). Nevertheless, if an intervenor has
asserted affirmative independent claims for relief, it may be
permitted to pursue such claims even if the original parties’
underlying claims are resolved. Id. at 675-76.
9 ¶ 22 Whether proceeding under a theory of intervention as a matter
of right or permissive intervention, C.R.C.P 24(c) provides that “[a]
person desiring to intervene shall serve a motion to intervene upon
the parties as provided in [C.R.C.P.] 5.” See also C.R.C.P 7(a)
(describing the limited types of pleadings permitted in a civil action).
Despite this obligation, Adams did not file a pleading with her
motion to intervene. But recall that, in the trial management
certificate, she stipulated that she claimed an interest in the
property “as a beneficiary of the Estate” and that she “is not an
owner of the property.” Thus, any “claim” or “right of recovery”
asserted by Adams is solely dependent upon her status as a
potential beneficiary of the Estate.
3. Personal Representatives
¶ 23 A personal representative is a fiduciary with a duty to settle
and distribute the decedent’s estate “in accordance with the terms
of any probated and effective will and [the Colorado Probate Code],
and as expeditiously and efficiently as is consistent with the best
interests of the estate.” § 15-12-703(1), C.R.S. 2024. Personal
representatives are vested with broad authority to facilitate their
duties. Fry & Co. v. Dist. Ct., 653 P.2d 1135, 1137 (Colo. 1982).
10 They have the authority to represent all owners who derive their
interests through the estate, and as such, are permitted to act on
behalf of an estate’s beneficiaries in a partition action. Id. at 1139.
¶ 24 Personal representatives are presumed to provide adequate
representation of the Estate beneficiaries’ interests. In re Estate of
Scott, 577 P.2d 311, 313 (Colo. App. 1978). Accordingly, a personal
representative represents “all owners who derive their interests
through the estate.” Fry, 653 P.2d at 1139. Thus, when a personal
representative is a party to a partition action involving estate
property, beneficiaries of the estate are not indispensable parties
and do not have a statutory right to intervene. Id.
C. Application
¶ 25 The district court did not enter a written order addressing the
motion for intervention, and thus did not explain whether it granted
Adams’s motion to intervene as a matter of right or permissively.
Adams points to a minute order entered after the hearing at which
the motion to intervene was filed, which states that she will be
“added as an intervenor to [sic] party.” From this statement, Adams
argues that she was granted full party status as an intervenor. But
Adams does not dispute that she asserted no claims in this case
11 and that her interest was based solely on her status as an Estate
beneficiary.
¶ 26 Because the district court approved the Estate’s substitution
motion, the only parties to the partition claims are Johnson and the
Estate. The personal representative represents the Estate’s
interests. Our appellate courts have recognized that absent a
showing of bad faith, collusion, negligence, or conflict of interest, a
personal representative adequately protects the interest of a
beneficiary:
When the law created a mechanism whereby one person as a representative of a group could conduct litigation, the purpose was the efficient, speedy, and orderly determination of rights which were held in common. For the courts to grant intervention to any member of a represented class who disagrees with the decisions of the representative, solely on that basis, would in our view defeat the entire purpose of representative litigation. A personal representative, under such a rule, would always be in danger of losing the ability to represent and act for the estate and might well find himself relegated to a position of looking on as the affairs of the estate became hopelessly entangled. It seems hardly likely that the General Assembly when it clothed the personal representative with far reaching affirmative powers, could have intended for his position to be so fragile.
12 ¶ 27 Scott, 577 P.2d at 313.
¶ 28 So, even though the district court did not expressly state
whether intervention was permissive or as of right, because there
was no basis for Adams to intervene as a matter of right and her
interest as a potential beneficiary of the Estate was adequately
represented by the personal representative, we conclude as a matter
of law that she was a permissive intervenor under C.R.C.P. 24(b).
¶ 29 Adams provides no support, and we are aware of no authority
that empowers permissive intervenors with the same rights as the
original parties. Adams cites A.M. v. A.C., 2013 CO 16, for the
proposition that in a dependency and neglect adjudication,
intervening foster parents are “afforded the same degree of
participation as all other parties.” Id. at ¶ 20. However, A.M. is
factually and legally distinguishable. There, the foster parents were
statutorily permitted to intervene as of right. See § 19-3-507(5)(d),
C.R.S. 2024. Here, Adams is a permissive intervenor. Moreover,
the right of full participation does not give the intervenor the ability
to reject a settlement agreement on a claim to which the intervenor
is not a party. Local No. 93, Int’l Ass’n of Firefighters v. City of
Cleveland, 478 U.S. 501, 529 (1986) (“[W]hile an intervenor is
13 entitled to present evidence and have its objections heard at the
hearings on whether to approve a consent decree, it does not have
power to block the decree merely by withholding its consent.”).
¶ 30 In the present matter, Adams raises no claim that Turner’s
representation was inadequate and also fails to provide any
authority to support her contention that her status as a permissive
intervenor gave her the ability to upend the settlement agreement
between the Estate and Johnson. Therefore, the district court did
not err by accepting the settlement agreement over Adams’s
objection.
¶ 31 Nor do we perceive any abuse of discretion in the district
court’s decision to approve the terms of the settlement agreement.
As the court noted, the disputed amount of anticipated sale
proceeds was negligible compared to the potential attorney fees that
the parties would accumulate if the matter proceeded to trial and
the risk that the jury may evaluate the Estate’s equity in the
property as less than 70.5%.
¶ 32 There also was no evidence to support Adams’s contention
that she was entitled to the entire property because she has no
current interest in the property and her interest as a potential
14 beneficiary of the Estate was adequately protected by the personal
representative who approved of the settlement. Finally, the district
court found no record support for Adams’s conclusory allegations
that the settlement was attributable to any conflict of interest or
improper action by Turner.
¶ 33 Given these findings, which are supported by the record, we
cannot conclude that the district court abused its discretion by
approving the settlement agreement.
D. Due Process Claim
¶ 34 Adams also contends that the district court violated her right
to due process by accepting the settlement agreement because it
prevented her from presenting evidence at the trial. We disagree.
¶ 35 Because we conclude that Adams’s status as a permissive
intervenor does not make her a party to the partition claims, it
necessarily follows that she did not have a right to reject the
settlement so that she could present evidence at a trial. As a
permissive intervenor, Adams had the right to be heard on the
question of whether the settlement should be approved. Local No.
93, 478 U.S. 501 at 529. But she did not have the right to force the
partition claim to a trial. See United States v. Carpenter, 526 F.3d
15 1237, 1240 (9th Cir. 2008) (“We recognize that the intervenors
whose claims are not the subject of a settlement cannot veto that
settlement.”).
¶ 36 Because Adams did not file a pleading setting forth any claims
or defenses of her own, she was not entitled to a trial once the
underlying partition claim between Johnson and the Estate was
resolved. The district court afforded Adams the right to be heard on
the propriety of the settlement agreement. That was the process to
which she was entitled. Accordingly, the court did not violate her
due process rights by preventing her from vetoing the resolution of
claims that the asserting and defending parties had resolved.
III. Attorney Fees
¶ 37 Johnson requests an award of costs and attorney fees
incurred in the district court and on appeal. With respect to
Johnson’s request for an award of attorney fees incurred before the
district court, we have no authority to make such an award because
it was not presented to or decided by the district court. See Crown
Life Ins. Co. v. Haag Ltd. P’ship, 929 P.2d 42, 45 (Colo. App. 1996)
(declining to address issue not presented to the trial court).
16 ¶ 38 Johnson also contends that she is entitled to an award of
attorney fees incurred on appeal because Adams’s appellate
contentions were frivolous, groundless, and vexatious. Section 13-
17-102, C.R.S. 2024, provides that a court shall award attorney
fees against any party who has defended a civil action, in whole or
in part, that lacked substantial justification. § 13-17-102(2). As
used in the statute, the phrase “‘[l]acked substantial justification’
means substantially frivolous, substantially groundless, or
substantially vexatious.” § 13-17-102(9)(a). In cases involving a
self-represented party, like Adams, the moving party must also
demonstrate that “the party clearly knew or reasonably should have
known that the party’s action or defense, or any part of the action
or defense, was substantially frivolous, substantially groundless, or
substantially vexatious.” § 13-17-102(6).
¶ 39 Aside from the conclusory assertion that Adams’s arguments
were colored by her emotions, Johnson makes no effort to develop
her contention that Adams’s arguments or conduct on appeal were
frivolous, groundless, or vexatious. Thus, we decline to address the
issue further. See Holley v. Huang, 284 P.3d 81, 87 (Colo. App.
2011) (declining to address undeveloped contentions).
17 IV. Disposition
¶ 40 The district court’s order is affirmed.
JUDGE TOW and JUDGE PAWAR concur.