Rocky Mountain Festivals, Inc. v. Parsons Corp.
242 P.3d 1067
| Colo. | 2010Background
- Town of Larkspur sought about $1.6 million in tap fees from Rocky Mountain Festivals based on Parsons’ flawed water/wastewater analysis.
- Trial court found Parsons’ report substantially flawed; festival owed only a small portion of the demanded fees.
- Festival sued Parsons directly, seeking damages under the wrong-of-another doctrine for litigation costs and attorneys’ fees incurred in the prior action.
- Trial court granted Parsons’ summary judgment; court of appeals affirmed on the narrow basis that festival’s partial liability barred recovery.
- Colorado Supreme Court granted certiorari to decide whether wrong-of-another damages may be recovered for a subset of claims litigated in the underlying action.
- Court held that damages may be awarded for segregable, factually and legally distinct claims; reversed the court of appeals.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Can wrong-of-another damages be sought when the plaintiff was partly at fault? | Festival asserts no per se bar due to partial fault; damages may be recoverable for segregable claims. | Brochner bars recovery when plaintiff was at fault in underlying action. | Yes, damages may be awarded for segregable claims despite partial fault. |
| Are damages under wrong-of-another limited to the entire underlying action or can they be limited to segregable claims? | Damages tied to the distinct water/wastewater issues can be separated and awarded. | Damages should be barred or not segregated; underlying fault precludes recovery. | Damages may be segregated to distinct claims with different facts/theories. |
| What standard governs segregation of claims for wrong-of-another damages? | Hensley v. Eckerhart informs segregation when claims involve different facts/theories. | No clear framework for segregating wrong-of-another damages in this context. | Use Hensley-based approach to determine segregability; segregable subset may support damages. |
| Was summary judgment inappropriate given factual questions about segregability and causation? | Disputed facts about segregability and causation preclude summary judgment. | Uniformly bar damages under wrong-of-another due to partial fault and lack of causation evidence. | Summary judgment inappropriate on the limited damages issue; genuine issues remain. |
Key Cases Cited
- Elijah v. Fender, 674 P.2d 946 (Colo. 1984) (wrong-of-another damages allowed when defendant's tort caused litigation)
- Trinidad Bean & Elevator Co. v. International State Bank of Trinidad, 79 Colo. 286, 245 P. 489 (Colo. 1926) (plaintiff forced into third-party litigation by defendant's conduct)
- Brochner v. Western Insurance Co., 724 P.2d 1293 (Colo. 1986) (without-fault limitation on wrong-of-another damages)
- Swartz v. Bianco Family Trust, 874 P.2d 430 (Colo. App. 1993) (recognizes possible claim segregation where underlying and third-party dispute intertwine)
- Hensley v. Eckerhart, 461 U.S. 424 (U.S. 1983) (fee-shifting segregation where claims are distinct in facts/theories)
- Lipsett v. Blanco, 975 F.2d 934 (1st Cir. 1992) (acknowledges equitable discretion in complex fee decisions)
- Elijah v. Fender, 674 P.2d 946 (Colo. 1984) (existing restatement basis for wrong-of-another damages)