Overton v. Chess.

  2022 COA 51. No. 20CA2091.  Property Tax—Treasurer’s Deed—Redemption—Interest—Improvements—Expenditures—Offset—Easement.

May 12, 2022

Chess and Erickson (Chess) owned property for which they failed to pay real estate taxes (property). The county treasurer subsequently conveyed a treasurer’s deed for the property to the Overtons. Chess challenged the validity of the treasurer’s deed based on lack of notice. After a bench trial, the district court found that Chess had not received the statutorily required notice. It ordered return of the property to Chess, subject to Chess reimbursing certain expenditures as required by CRS § 39-12-101. In determining that amount, the court denied Chess’s request for an offset for the value of a utility easement on part of the property that the Overtons had conveyed to a third party. The court later authorized Chess to deposit into the court registry the principal amount determined by the court together with interest that was computed from the date of the court’s initial order.

On appeal, the Overtons argued that CRS § 39-12-101 required prejudgment interest on reimbursement amounts accruing from the date of the expenditures. CRS § 39-12-101 authorizes prejudgment interest on all categories of expenditures listed in the statute. It requires interest on reimbursement amounts from the date of ascertainment as to the value of improvements and from the date each of the remaining expenditures were made. Here, other than the value of improvements, the court erred by awarding interest only from the date it ascertained the amount of the expenditures.

On cross-appeal, Chess contended that the district court erred when it denied an offset for the value of the utility easement the Overtons conveyed. Here, the record contained the offer letter from the utility for the easement and the easement deed itself, which supplied at least some evidence of the value of the easement and thus some evidence of diminution in value of the entire parcel. Accordingly, the district court’s conclusion that there was no evidence regarding the property’s value was clearly erroneous.

The judgment was affirmed in part and reversed in part. The case was remanded for the district court to ascertain the amount of interest accruing from the date expenditures other than improvements were made, and to make findings and conclusions on the value, if any, of the easement, and to enter judgment accordingly.