Weize Co. v. Colorado Regional Construction, Inc.

251 P.3d 489, 2010 Colo. App. LEXIS 814, 2010 WL 2306413
CourtColorado Court of Appeals
DecidedJune 10, 2010
Docket09CA1369
StatusPublished
Cited by349 cases

This text of 251 P.3d 489 (Weize Co. v. Colorado Regional Construction, Inc.) is published on Counsel Stack Legal Research, covering Colorado Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Weize Co. v. Colorado Regional Construction, Inc., 251 P.3d 489, 2010 Colo. App. LEXIS 814, 2010 WL 2306413 (Colo. Ct. App. 2010).

Opinion

Opinion by

Judge WEBB.

In this construction dispute, plaintiff, Weize Company, LLC, and plaintiff-interve-nor, Martz Supply Company, raise claims for breach of contract, to foreclose a mechanies' lien, and under section 88-22-127, C.R.8.2009 (trust fund statute). Following a bench trial, the court dismissed the lien foreclosure claim for failure to record a lis pendens and awarded damages against defendant, Colorado Regional Construction, Inc. (CRC), on the other two claims. Both sides appealed. We affirm, reinstate the trial court's order awarding 12% prejudgment interest on treble damages awarded under the trust fund statute, and remand for further proceedings on attorney fees.

I. Facts

CRC, a general contractor, hired Weize as plumbing subcontractor. Martz provided plumbing materials to Weige. After Weize had completed all of the underground plumb ing and some of the above-ground plumbing, CRC replaced it with a different plumbing subcontractor.

When CRC failed to pay Weize for the completed work, it recorded mechanies' liens against the project and commenced this action. Martz intervened, joining in the claims for breach of contract and lien foreclosure. *492 It added a claim against CRC for treble damages and attorney fees under the trust fund statute. The trial court allowed CRC to substitute bonds for the Hens, which were released.

II. Master Plumber Licensure

CRC first contends the trial court erred by precluding its defense that all claims were barred because Weize's principal, John Neib-erger, was not licensed as a master plumber nor did Weize employ a master plumber on the project. We disagree.

CRC relies on section 12-58-105, C.R.S. 2009, which provides, as relevant here:

(1) No person shall engage in or work at the business, trade, or calling of a residential, journeyman, or master plumber in this state until he has received a license from the division of registrations ....
(8) ... In order to act as a plumbing contractor, the person, firm, partnership, corporation, association, or other organization must either be, or employ full-time, a master plumber, who shall be in charge of the supervision of all plumbing work performed by such contractor.

See Carter v. Thompkins, 133 Colo. 279, 282, 294 P.2d 265, 266 (1956) (Iimiting recovery by a plumber to services and materials for which a license was not required; "[clon-tracts for services by one who is required by statute to have a license ... and who does not have such a license are generally unenforceable").

The trial court made no finding whether Weize violated this provision. For the following reasons, we conclude that CRC is not entitled to reversal, even if Weige failed to comply with section 12-58-105.

A. Standing

We first reject CRC's contention that because lack of licensure rendered the contract illegal, Weise did not have standing.

Standing is a jurisdictional limitation that can be raised for the first time on appeal. Anson v. Trujillo, 56 P.3d 114, 117 (Colo.App.2002). It requires that a claimant have suffered actual injury to a legally protected interest. Ainscough v. Owens, 90 P.3d 851, 856 (Colo.2004). Such an interest "may be tangible or economic such as ... one arising out of contract." Id. (internal quotations omitted).

CRC's standing argument relies solely on Potter v. Swinehart, 117 Colo. 28, 184 P.2d 149 (1947) (action by wholesale purchaser should have been dismissed because defendant-seller not licensed to sell liquor at wholesale). The supreme court observed, "[slinee plaintiff seeks relief under the terms of an illegal contract, he has no standing in the courts of this state." Id. at 28, 184 P.2d at 152.

Potter does not include any analysis of standing. The cases on illegal contracts cited in Potter do not refer to standing. Potter has never been cited for the proposition that illegal contracts implicate standing. Carter did not mention standing. More recent Colorado cases presented with such contracts do not refer to standing. See, e.g., Feiger, Collison & Killmer v. Jones, 926 P.2d 1244, 1251 (Colo.1996) (flegal contracts are void as against public policy); Equitex, Inc. v. Ungar, 60 P.3d 746, 750 (Colo.App.2002) (same). Thus, we conclude that the statement is dicta, "which is not binding on us." See McCallum Family L.L.C. v. Winger, 221 P.3d 69, 73 (Colo.App.2009).

CRC cites no other case from any jurisdiction, nor have we found one, rejecting a claim based on an illegal contract for lack of standing. Other jurisdictions treat an illegal contract as an affirmative defense, not a lack of standing. 1 We discern no reason to hold otherwise, and thus turn to CRC's arguments concerning illegality as an affirmative defense.

*493 B. Illegality as an Affirmative Defense

We need not address CRC's alternative contention that the trial court erred in holding illegality was insufficiently pled as an affirmative defense, because in the next subsection we conclude that the trial court properly struck all of CRC's affirmative defenses as a discovery sanction. 2

C. Sanctions

Weize moved to compel CRC to make initial disclosures three months after Weigze and Martz had made their disclosures. When CRC did not respond, the trial court ordered it to submit initial disclosures by September 4, 2008.

On October 24, Weize requested the trial court to enter a default judgment because CRC had not yet made its disclosures. The court found that CRC was "in violation both of the Colorado Rules of Civil Procedure, and the Order of this Court issued on August 25, 2008," but declined to enter default judgment because:

The Court finds the sanction advocated by Plaintiff to be exceptionally harsh for a pro se Defendant who now has counsel. The Court is happy to consider an intermediate sanction, if Plaintiff can suggest one which the Court finds reasonable.

CRC did not submit its disclosures until November 12. Weize and Martz then moved for limited sanctions. Again, CRC did not respond. The court struck all of CRC's counterclaims and affirmative defenses.

We review discovery sanctions for an abuse of discretion and will uphold the decision unless it is manifestly arbitrary, unreasonable, or unfair. Pinkstaff v. Black & Decker (U.S.) Inc., 211 P.3d 698, 702 (Colo.2009). "[The courts are given flexibility in choosing the appropriate sanction." Nagy v. District Court, 762 P.2d 158, 160 (Colo.1988). C.R.C.P. 37(c) permits striking affirmative defenses. The most extreme sanction is default judgment. Trattler v. Citron, 182 P.3d 674, 680 (Colo.2008); see C.R.C.P. 87(c).

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Cite This Page — Counsel Stack

Bluebook (online)
251 P.3d 489, 2010 Colo. App. LEXIS 814, 2010 WL 2306413, Counsel Stack Legal Research, https://law.counselstack.com/opinion/weize-co-v-colorado-regional-construction-inc-coloctapp-2010.