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Far Horizons, LLC v. Flying Dutchman Condominium Ass’n Inc.

2023 COA 99. No. 22CA1298. Colorado Common Interest Ownership Act—Enforcement—Attorney Fees.

October 26, 2023

Far Horizons Farm, LLC (Far Horizons) owns a unit in the Flying Dutchman Condominiums. The recorded condominium declaration (declaration) entitles Far Horizons to the exclusive use of one parking space that is reasonably designated by the Flying Dutchman Condominium Association, Inc. (UOA). Far Horizons demanded that the UOA designate such a space for its unit, but the UOA ignored that demand. Far Horizons sued the UOA for declaratory relief/quiet title and breach of the declaration. The district court granted summary judgment in Far Horizons’ favor on the declaratory relief claim and ordered the UOA to designate a parking spot for Far Horizons. After the jury ruled in its favor on the breach of the declaration claim, the UOA moved for an award of attorney fees under CRS § 38-33.3-123. It also moved for a costs award under the offer of settlement statute and other more generally applicable costs award provisions. After determining that Far Horizons prevailed on the declaratory relief claim and that the UOA prevailed on the breach of declaration claim, the court awarded attorney fees to both parties accordingly. The court awarded Far Horizons its costs incurred before the UOA submitted its offer of settlement and awarded the UOA its costs incurred after it submitted its offer of settlement. The court then offset the respective amounts of attorney fees and costs and entered judgment in Far Horizons’ favor and against the UOA in the amount of $13,851.30.

On appeal, Far Horizons argued that the district court misapplied CRS § 38-33.3-123(1)(c) as requiring a court to determine the prevailing party in an action subject to the Colorado Common Interest Ownership Act (CCIOA) on a claim-by-claim basis. Far Horizons asserted that because the court determined that it was the prevailing party “in the suit as a whole,” it is entitled to an award of all its reasonable attorney fees incurred and that the UOA isn’t entitled to recover any fees. Prior court of appeals decisions holding that the determination of the prevailing party must be made on a claim-by-claim basis were abrogated by the 2006 amendments to the CCIOA, which require a court to determine which party was the overall prevailing party for purposes of awarding attorney fees under that statute. Here, all claims asserted are indisputably subject to the CCIOA. Accordingly, the district court erred by determining the prevailing party on a claim-by-claim basis.

Far Horizons also contended that the court erred by awarding costs to the UOA under the offer of settlement statute because Far Horizons recovered more than $5,000 when considering attorney fees and costs. It asserted that the district court failed to account for Far Horizons’ recovery of attorney fees and costs when comparing the offer and the final judgment and thereby reduced its costs award. Under the offer of settlement statute, if a defendant serves an offer of settlement in writing more than 14 days before trial that is rejected by the plaintiff, and the plaintiff doesn’t recover a judgment that exceeds the settlement offer, then the defendant shall be awarded actual costs accruing after the date of the settlement offer. Here, after the court granted summary judgment for Far Horizons on its declaratory relief claim and before the trial on the breach of declaration claim, the UOA served Far Horizons with a $5,000 settlement offer under CRS § 13-17-202 for all claims, inclusive of attorney fees, interest, and costs accrued to date. Far Horizons didn’t accept the offer. It is undisputed that Far Horizons recovered attorney fees and costs totaling more than $5,000, so the UOA isn’t entitled to recover costs under that statute. Accordingly, the district court erred by awarding the UOA costs under the offer of settlement statute.

The court also granted Far Horizons’ request for an award of its attorney fees incurred on appeal under CRS § 38-33.3-123(1)(c).

The order on attorney fees and costs was reversed, and the case was remanded for the district court to redetermine the amount of attorney fees and costs to which Far Horizons is entitled.

Official Colorado Court of Appeals proceedings can be found at the Colorado Court of Appeals website.

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