RECENT COURT DECISIONS – COLORADO LAW
Oasis Legal Finance Group v. Coffman – Litigation financing is a “loan” subject to state regulations. (SC 11/16/15). The Supreme Court held that litigation finance companies that agree to advance money to tort plaintiffs in exchange for future litigation proceeds are making “loans” subject to Colorado’s Uniform Consumer Credit Code even if the plaintiffs do not have an obligation to repay any deficiency if the litigation proceeds are ultimately less than the amount due. These transactions create debt, or an obligation to repay, that grows with the passage of time. The court of appeals’ judgment was affirmed.
Rogers v. Forest City Stapleton, Inc. – Court of Appeals extends implied warranties on residential lots; affirms trial court rationale on discovery sanctions (CA 11/19/15). Defendants served as the master developer for the redevelopment of the old Stapleton International Airport. Forest City sold the vacant residential lot at issue here to a homebuilder. Plaintiff then contracted with the homebuilder to build a home. Rogers paid the builder an extra fee to include a basement that could later be finished. After learning that his lot was not suitable for a home with a basement that could be finished, Rogers brought claims for breach of implied warranty, nuisance, and negligent misrepresentation. On appeal, Forest City argued that the trial court erred by instructing the jury that it could find that an implied warranty runs from a developer to a homeowner under the circumstances of this case. The Court of Appeals held that an implied warranty of suitability exists between a developer of a vacant lot and the owner of a home on that lot who is not the first purchaser if (1) the developer improves the lot for a particular purpose, and (2) all subsequent purchasers rely on the developer’s skill or expertise in improving the lot for that particular purpose.
Colorado Union of Taxpayers Foundation v. City of Aspen – City of Aspen wins the great plastic bag debate (CA 11/05/15). In 2011, the City of Aspen adopted an ordinance requiring grocers to charge customers a waste reduction fee of $.20 for each disposable paper bag provided. For the first year, grocers were permitted to retain 25% of each fee collected up to $1,000 per month. Thereafter, grocers were permitted to retain no more than $100 per month. The remaining fees were deposited into the City’s Waste Reduction and Recycling Account. In August 2012, the Colorado Union of Taxpayers Foundation sued the City, alleging that the enactment of the ordinance without first obtaining voter approval violated TABOR – which requires voters approve any new tax. The Court of Appeals found the primary purpose of the ordinance was to reduce waste, and the majority of the funds raised from the fee went to providing reusable bags to residents and visitors and were a fee not within the limits of TABOR.
Dickinson v. G4S Secure Solutions (USA), Inc. – Court of Appeals holds default limits liability issues; affirms trial court rejection of negligence per se building code violation (CA 11/19/15). Dickinson sought damages for shoulder injuries sustained when she attempted to open a door leading to her workplace that allegedly was locked or malfunctioning. She sued the building owners, LBC and Wells Fargo, and the security company which allegedly failed to unlock the door, G4S. As to the claim against G4S, the issue was a tendered negligence per se instruction citing a building code. The Court held this building code provision did not apply to G4S, a security company. Moreover, even if it did apply, no evidence was presented that the code section regarding the door’s locking mechanism was intended to protect against injuries stemming from attempting to open a locked exit door.