*1 to a and conversion permits continuation Realty LANE, plan, as the Lane insurance" Robert B. lesser d/b/a "similar Plaintiff, Company, notes, maj. op. at the cost
majority see converting continuing or employee of to the precisely known cannot be health insurance URGITUS, M. Richard Ronald J. actually pur- until, employee unless, Calhoun, and Richard CB particular plan. chases a Ellis, Inc., Defendants. statute, majority as the Understanding the No. 06SA49. continuing health does, the cost to treat benefit, though fringe even as a insurance Colorado, Supreme Court of the increase not to use employee chooses En Banc. purpose, disability for benefit his 23, 2006. Oct. formula carefully worked-out deprives this employees who had gives any significance; being injured a
accepted coverage before not; those who had
meaningless over windfall policy interest public
and emasculates injured workers to
providing an incentive coverage. health While
continue their delay are hardships of transactional
potential virtually any legal proceeding, the
realities of delay in-
majority suggest cannot continuation of by requiring actual
creased increasing benefits coverage, or that
health failure to contin- employee despite his
for the employ- serves the coverage better
ue health merely points to It care needs.
ee's health employees, even this that for some
the fact meaningful incen- may provide a
option not
tive. mind, majority's interpretation my
To disability more than increase
does little by an injured employees, of certain
checks money rate is unrelated
amount recompensed services were which their appro- disability, ignoring
before their while continuity, symme-
priate considerations policy in
try, public the determination respectfully I therefore
legislative intent.
dissent. *3 Joiner,
Frascona, and Green- Goodman stein, Osofsky, Roger B. G. P.C. Matthew Boulder, Colorado, Frascona, Bock, E. Oliver Plaintiff. Attorneys for Silver, Deboskey, L. & P.C. Joe Silver Colorado, Beier, Denver, Attor- D. Martin neys for Defendants. LLP, Lyons Rich-
Rothgerber Johnson & Denver, Clark, Craig Welling R. Colo- ard K. rado, National Attorneys for Amici Curiae REALTORS® and Colorado Association of of REALTORS®. Association Opinion delivered Justice HOBBS the Court. es a over real
This case involves among Colora referral fees tate transaction were brokers who do licensed real estate Metropolitan Com Denver members of- REALTORS® mercial Association ("DMCAR") and dis when the transactions express condi case arose.1 An putes this will membership is that members tion of binding arbitration. such submit separately executed an Each of the brokers membership that includ application form for with arbitration accordance ed consent to local and interconnected requirements of organiza professional REALTOR® national tions. a alleges existence of complaint among licensed agreement fee
referral brokers, parties who are estate Colorado real entered an district court to this case.2 The DMCAR, part joined, registered first is now federаlly collec- houn 1. "REALTOR®" is Urgitus joined. which National As- membership used tive mark and its constituent sociation of REALTORS® alleged of REALTORS® into the state and local associations entered 2. Whether membership for the Individuals is a factual matter indicate their status. fee referral are called of these associations act, who are members Under Colorado's arbitration. whether a condition determines appears the record that the arbitrator It from REALTORS®. arbitrability fulfilled and precedent has been which Cal- REALTORS®, the Denver Board I. binding pursuant order for to see 1822-207, (2005), tion of Colorado's Lane, Plaintiff Realty Robert Lane d/b/a bringing Act. In Uniform Arbitration ("Lane") Company, is a licensed Colorado original proceeding under C.A.R. the de real estate employing broker and broker at fendant assert brokers no arbitration Realty Company. Lane He served as chief (1) existed because did financial Weberg Enterprises, officer for In- not execute corporated from 1985 until when the other, each closed, company property manager among assоciation does not create a contract Weberg Properties, the real estate arm of organization, members of that if even Weberg's property. John In 2002 John We- arbitrate, there was an it *4 berg regarding solicited Lane's advice ceased to exist when the defendant brokers realtors who Weberg dispos- could assist membership withdrew their from DMCAR.3 ing of portfolio. his real estate alleges Lane We affirm the district court's arbitration and, that he contacted several realtors on order. hold that We district court did July 2002, he entered into a "referral fee (1) not in ordering err arbitration because agreement" Ellis, with CB Richard Incorpo- each of these licensed real estate ("CBRE") brokers had rated for "a referral of 20% on previously consented to arbitration with oth- any going deals forward with John P. We- professional er members of the berg." organization themselves; disputes among should arise complaint The alleges following. each of these brokers were members of the February after the sale of one of We- they whеn entered into the al- berg's properties, Fairways Shopping Plaza leged referral fee and the dis- Center, paid CBRE approximately Lane arose; putes and their consents to arbi- $52,000 as a referral fee. When a second implied trate constituted an condition of the Weberg property sold in County alleged referral fee enforceable property, Line Urgitus, employ- Ronald Act, under Colorado's Uniform Arbitration CBRE, ing broker of payment refused -2839, (2006). sections 18-22-201 to C.R.S. referral fee. Lane listing learned of a holding reasoning Our and in this case are CBRE for the sale of a Weberg proper- third limited to the cireumstance of an ty, Denver Distribution Center. Lane con- among to the lawsuit in- Calhoun, managing tacted Richard broker at CBRE, implied cludes an regarding the status of his referral condition to arbitrate. We do not by-laws decide or address whether for listings fees the two for which he had association are enforceable received no fee. Calhoun payment. refused against among and individuals absent a con- January 2005,pursuant On рro tractual relationship that would include an cedures the Denver Board implied condition as exists in this case. REALTORS®, Lane Request submitted a
Because the district court Agreement should have and to Arbitrate form to stayed pending pursu- lawsuit arbitration DMCAR. The DMCAR sent a notice of the 18-22-207(7), ant to section rather than dis- request Urgitus and Calhoun it, missing we set 8, 2005, aside the district February on requested court's a re sponse by dismissal, February Urgitus 2005.4 order of and order the lawsuit stayed pending arbitration. respond, Calhoun did not withdrew containing whether a contract bylaws require valid tion with its members to 13-22-206(3), arbitrate. is enforceable. (2006). authority 2. Whether the trial court exceeded its declining certify and abused its discretion in petitioners phrase 3. The their issues as follows: appeal. its decision for 1. agree- Whether, in the absence aof written Only 4. individuals licensed as real estate brokers ment between them to arbitrate, can be compelled they belong eligible apply to arbitrate because are for in the local formerly belonged professional organiza- to a REALTOR® аssociation. Manual, of Practice of May and Standards on membership in DMCAR their pro- of REALTORS® Association National 2005. Two-Membership Duties and vides in "Part July 2005 to collect suit filed In his Enforcement" that: Their him, sought Lane allegedly owed fees fol- membership include the The duties on involved The brokers order. (a) by of Ethics the Code lowing: to abide li action are Colorado this both sides of Association the National filed an brokers. real estate censed (b) REALTORS®; by abide DMCAR, membership with application for regulations; rules and and its of this Board this a member of and was accepted, was (c) disputes arbitration all to submit to which the disputes for when the association by this Manual in Part ten of specified arose. Calhoun ordered court to abide provided, and procedure therein membership with for application filed award.... the arbitrators' a member DMCAR, accepted, and was was Disputes," Ten-Arbitration when "Part of this association turn, obligation partic- arose.5 provides "[t]he ordered arbitration the court which Ar- contemplated ipate in arbitration membership Urgitus application for obligationof REALTORS® ticle includes the following contained signed for DMCAR *5 firms to arbitrate to cause their (principles) provisions: matters by any award." The and be bound approved, I my application is In the event include "entitlement that must be arbitrated membership to of agree as a condition coopera- compensation to commissions and course and ethics complete the orientation of busi- that arise out the tive transactions my DMCAR; on own and to otherwise of REALTORS® relationships between ness myself familiarize thoroughly initiative and their clients REALTORS® and between of the National Ethics with the Code of Article 17 of the Stan- and customers...." REALTORS®, including of Association of the National Association of Practice dards disputes in duty business the to arbitrate provides: of REALTORS® Ethics and the Code accordance with of ... disputes of contractual In the event the the Board and Manual Arbitration of (principals) associ- REALTORS® Constitutions, Bylaws, Rules and and firms, arising out of ated with different DMCAR, As- the Colorado Regulations of REALTORS®, the relаtionship as their I the National Association. sociation and to shall submit REALTORS® satisfactorily complete a to agree further regula- in accordance with the arbitration non-discriminatory written and reasonable rather than their Board or Boards tions of Code, covering such Constitu- examination litigate the matter. tions, Regulations, and Bylaws, Rules and Obligations," VI-Privileges and "Article my agree that I further duty to arbitrate. 5(a), Bylaws provides of the DMCAR section my evidence initial paying dues shall act of resigns or otherwise "if a member continuing commitment to abide that and terminate, duty to membership to causes Ethics, of Consti- aforementioned Code in effect even to continues submit tutions, Regulations, Bylaws, Rules and terminated, membership lapses or is after arbitrate, time to all as from and to dispute arose while provided that amended. time was a REALTOR®." former member added). application form (Emphasis 8, 2005, notified February DMCAR provi- On contained signed for DMCAR Calhoun request to of Lane's Urgitus and Calhoun Urgitus signed. to those equivalent sions sign a form to relat- ap- and sent them signed arbitrаte by reference Incorporated They sign and Ethics, did not ing to the arbitration. of Arbitration plications, Code that National Association 1973; Manual 5. Amici Curiae and Arbitration Ethics pursuant to detailed are conducted arbitrations Colorado Association REALTORS® and panel neutral real estate procedures before 25,000 that REALTOR® inform us REALTORS® Colorado; such arbitra- professionals to conduct trained that the and work in members reside adopted tions. the Code first national form.6 Three months thereafter return A. Standard Review in, they from withdrew Whether organizations. REALTOR® The transac exists is a matter of law we review de alleges tions and for which Lane Pacheco, novo. Allen v. compensation Urgitus is due from (Colo.2003); see also Parker v. Cir. Crea Calhounarose before their terminated Leadership, tive (Colo.App. P.3d membership. 2000) ("'The question arbitrability is one 18-22-2047, Pursuant to section CRS. decide."). for the court determining (2006), the district court ordered whether agreed have to submit "submit the matters described [Lane's] arbitration, question the issue in we follow complaint binding pursuant principles state law governing contract for [DMCAR]," placed the rules of the case Allen, 378; mation. City & Coun stay pending "under the outcome of the arbi- ty Court, Denver v. Dist. tration and until such time as the (Colo.1997). request that the determination of the arbitra- judgment tors to a be reduced of this Court." must .We construe the terms of the Thereafter, the district court amended its a manner that al prior tunc, pro order nune as follows: party lows each to receive the benefit of the (1) the title of the Order read shall "Order bargain, scope of the Granting Compel Plaintiffs Motion to Ar- faithfully must reflect expec reasonable bitration;" and claim com- Allen, Plaintiff's parties. tations of the at 378. P.3d pel granted arbitration is remain- interpret We must the arbitration ing Complaint claims of the are Amended in a manner best effectuates intent dismissed, prejudice. without parties. Id. *6 Urgitus sought of the district certification To scope determine the of an arbi court's appeal, pursuant order to we, must examine agreement, the tration 54(b). C.R.C.P. The district court denied the wording give in order to аscertain and effect required motion for certification and that the to the mutual intent of the as well as "parties cooperate shall in the immediate subject purposes the matter and to be accom scheduling of arbitration." plished by agreement. Marriage the In re Popack, (Colo.App.2000). 998 P.2d IL. parties' by looking We ascertain the intent to
We hold that the district court did not err plain language agree the of the arbitration (1) ordering Allen, 378; because each of ment. 71 P.3d at see also State these licensed real previ- estate brokers had Stein, Farm Mut. Auto. Ins. v.Co. 940 P.2d ously (Colo.1997) to consented arbitration with other (addressing insurance professional members of the organization policies generally). (2) themselves; among
should
arise
agreement
will enforce
We
as
each of these brokers
were members of the
when
entered into the al-
ambiguity
written unless there is an
leged
agreement
referral
fee
language;
and the dis-
courts should
rewrite the
neither
(8)
arose;
putes
agreement
and
their consents to arbi-
nor limit its effect
a strained
Allen,
implied
Thus,
trate
an
constituted
condition of the
construction.
P.3d
378.
alleged
contract,
agreement
any
referral
fee
agreement
enforceable
like
an arbitration
Act,
under
given
according
plain
Colorado's Uniform Arbitration
must
effect
be
to the
(2006).
-289,
ordinary meaning
sections 13-22-2201 to
C.R.S.
of its terms.
Id.
Urgitus
signed,
incorporated
6.
and Calhoun contend that
the form
documents in the
accompanying
request
the notice of arbitration
original proceeding, plainly impose
record of this
duty
constitutes an admission that
to arbi-
a
of arbitration even if a member does not
involving
trate
REALTOR® members does not
sign
requested
and return the form when
to do
signs
arise unless the member
ever,
this form. How-
-
so.
application
forms
and Calhoun
Marriage
re
Po
disputes.7 In
ambigu ment of
determining
whether
In
("All doubts whether
ity we to resolved dispute is arbitrable are susceptible on its face reasonably provision arbitration."); Farmers Ins. Exch. also interpretation. Id. We favor more than one to (Colo.App.2001). Taylor, 45 P.3d v. agreement the arbitration evaluate harmony language whole and construe explicitly author- arbitration act Colorado's accepted mean generally plain compel to a cause of action izes intent employed, unless the words ing of the agree- alleges an enforceable party when an alterna parties demonstrates refus- person's and another ment is intended. Id. interpretation tive agreement. pursuant al to arbitrate arbi are found ambiguities If showing an person motion of a On the parties a afford the agreement, we tration alleging anoth- arbitrate and re in favor of arbitration presumption pursuant person's refusal to arbitrate er scope of the arbitra about the solve doubts agreement: Id.; see in favor of arbitration. clause tion (a) appear refusing party If does not Denver, at 1364. County City & motion, the court oppose not or does arbitrate; parties to order the shall Agreements Are Arbitration B. in Colorado Favored (b) refusing party opposes the If the motion, summarily proceed court shall Colorado, a favored arbitration is the issue and order to decide Peterman resolution. method no it finds that there is arbitrate unless Co., 961 P.2d Auto. Ins. Farm Mut. State to arbitrate. enforceable (Colo.1998); v. State see Wales Co., Colo.App. Auto. Ins. Farm Mut. person alleging that the motion of a On (1976). constitu Our initi- proceeding has been an arbitration statutes, sup tion, case law all and our our that there is not ated or threatened but disputes. Colo. agreements to arbitrate port arbitrate, pro- the court shall - XVIII, 8; §§ 18-22-201 Const. art. If the summarily to the issue. ceed decide (2006); Farm Peterman v. State an enforceable finds that there is court Co., at 493. Ins. Mut. Auto. arbitrate, it shall order the *7 parties to arbitrate. XVIII, 3 of the Colorado section Article provides: Constitution (2006). 13-22-207, § C.R.S. duty general assem- of the It shall be provides for a act Colorado's arbitration necessary may laws as be
bly
pass
to
such
of duties between arbitrators
division
by arbi-
proper to decide differences
court:
trators,
by
agree-
appointed
mutual
to be
(1)
in a record to
agreement
An
contained
controversy who
parties
any
to
ment of the
any existing or
to arbitration
sub-
submit
adjustment.
The
may choose that mode
controversy arising
sequent
of such arbitrators
shall
powers and duties
valid,
agreement
enforce-
parties to the
is
prescribed
law.
be
able,
except
ground
on a
and irrevocable
provision,
to this
General
Pursuant
equity
or
that exists at
law
Arbi-
Assembly's enactment of the Uniform
contract.
revocation of a
-2839,
Act,
18-22-201 to
tration
sections
an
shall decide whether
The court
statutory framework for
a uniform
provides
or a contro-
agreement
to arbitrate exists
encourage
to
the settle-
order
4, 2004,
parties
13,
2,
August
all
if
was
made before
part
Arbitration Act
Uniform
7. Title
2004,
proceeding so
agreement
or to the
originally
the substan-
enacted in 1975.
In
reenacted,
agreement
to
agreed
Since the
in a record."
repealed
provisions were
tive
4,
August
prior
made
arbitrate in this case was
causing
and elimina-
addition,
relocation,
some
subject
matter. Sec-
to the Act in
sections as well
and no revisions were made
tion of
2004,
Act,
2006,
13-22-203(2),
(2004),
part 2 Uniform Arbitration
we cite to
provides C.R.S.
tion
(2006).
agreement
C.R.S.
govern
"part 2
an
shall
versy
subject
to an
if
stay
arbi-
the district court had entered a
in-
dismissal,
stead of a
trate.
order would not be
(internal
omitted) ).
appealable")
quotations
(3) An
shall decide whether a
arbitrator
arbitrability
precedent
condition
has
C,.
Agreement
An
to Arbitrate
fulfilled and whether a contract con-
been
Exists in this Case
taining
a valid
to arbitrate is
law,
Under Colorado
contractual
enforceable.
may
express
implied.
conditions
be
E.g.,
or
party
judicial proceeding
If a
to a
chal-
Co.,
Goodson Am. Standard Ins.
of,
lenges the
existence
claims that
(Colo.2004); Cary
v. United Oma
subject to,
controversy
is not
Co.,
ha
Ins
Life
arbitrate,
proceeding
the arbitration
(Colo.20083)(addressing implied contractual
may
pending
continue
final resolution of
good
dealing).
faith and fair
When
court,
the issue
unless the court
contract,
interpreting
we consider "the
otherwise orders.
attending
facts and cireumstances
its execu
(2006).
18-22-206,
§
tion,
as to
so
learn the intentiоns of the
Denver,
parties."
Eisenhart v.
Colo.App.
Reyn
In
v. Dean
Howsam
Witter
470,478,
(1915),
150P.
aff'd,
olds, Inc.,
64 Colo.
Supreme
United States
Court
(1918).
principles governing
restated the basic
G81
required
in a
to submit to
ation
dispute
contained
record
them to arbitrate
with
any
subsequent controversy
client,
existing or
aris-
though they
even
had not entered into
ing
is
any
between
other contract or
with client
valid, enforceable,
except
and irrevocable
on
her);
disputes
King
v. Lar
ground
equity
a
that exists at law or in
for
Inc.,
Realty,
349, 357,
App.3d
sen
121 Cal.
175
the revocation of a contract."
Cal.Rptr.
(holding
that members
of the California Association of Realtors are
sophisticated
litigants
here are
busi
they
bound to arbitrate when
have contract
persons
agreed
by
to
ness
who
abide
set of
by
bylaws,
ed to abide
the Association's
governance rules and ethical standards that
bylaws
arbitrate);
impose
duty
those
to
professional
beyond
included
commitments
Dial-A-House,
1026,
Bastone v.
100 Misc.2d
required by
those otherwise
Colorado law
(1979) (holding
submit Board of their regulations with the dance COATSdissents. Justice litigate the matter. than rather or Boards EID, concurring. specially Justice REALTORS®, Code of Association National Practice, Article and Standards of Ethics majority that the trial agree I 12.8 in Manual at correctly parties to arbi- ordered the court by dispute, I reach thаt result their but trate Calhoun, may defeat Urgitus, nor Neither taking route. a different fee dis- transactions the arbitration membership in during their arose putes that required "agree- majority finds the The by withdraw- REALTOR® 18-22-207(1), arbitrate," C.R.S. ment to disputes with membership after the ing from (2006), agreement between in the referral fee language and mean- plain The Lane arose. Urgitus Lane and defendants plaintiff in this documents ing of the REALTOR® According Maj. op. at 682. Calhoun. by incorporated refer- proceeding, original a term majority, implied in that application for member- signed in the ence any dis- obligating to arbitrate disputes arising ships, requires arbitration them-a term pute might arise between members. This disputants were when the membership in a of their that exists virtue only disputes. such lawsuit addresses that creat- voluntary professional association "duty arbitrate" as a "condition ed a fee into the referral If entered Id. at membership agreements...." their complaint, alleged in the which agreement as 680. matter for determination is a factual view, contrast, my in the relevant By 18-22-2068), under section arbitration express to arbitrate" are "agreement[s] (2006), Urgitus and Lane became then Urgitus and DMCAR agreements between arbitrate implied condition to bound (the "Membership and Calhoun and DMCAR under arbitra enforceable Colorado's that is require Urgitus which Agreements"), provision of a arbitration tion act. A valid any dispute over referral to submit Calhoun jurisdiction a trial court contract divests involving members other DMCAR fees questions that are be submitted over all below, explain I Lane is As arbitration. arbitration, of arbitration. pending conclusion Membership beneficiary to the third-party ordering not err The district court did is entitled to Agreements, and as such he in this case.9 arbitration compel agreements in order to those enforce to arbitrate. Urgitus and Calhoun the district court should Because stayed pending lawsuit have fact that both one No 18-22-207(7), rather than pursuant to section Membership into the and Calhoun entered it, court's dismissing aside the district we set agree- In these Agreements with DMCAR. stayed order, and order the lawsuit dismissal ments, committed Urgitus and both Calhoun pending arbitration. disputеs" with other to "arbitrate business "in accordance with members
DMCAR and Arbitration Manual Ethics Code of IIL. Constitutions, Bylaws, and Board Regulations" of DMCAR. Id. Rules and court's Accordingly, affirm the district we Ethics, turn, makes clear order, discharge part, our rule in 676. Code to all extends part. our rule absolute and make attorneys fees in this to award 9. We decline Ethics Originally the Code of 8. adopted accepted juris- We cite to we original proceeding amended from time time. because has been Arbitration Code Ethics and the 2005 edition of important public issue we diction to review in effect at the time Manual which was decided, we find previously do not not had complaint was arose and the presentation to have been frivolous. its interpreta- all case filed. This edition includes approved by Standards the Professional tions through Committee 2004.
G83
beneficiary:
intended
REALTOR® mem-
disputes over "entitlement
to commissions
bers,
Lane,
compensation
cooperative
may
transactions
disputes
and
such as
who
have
relationships
Indeed,
contracting parties.
out of the business
with
that arise
. . . ."
obligation
Urgitus
between REALTORS®
Id. at 676.
to arbitrate benefited
and
well,
Calhoun as
could
seek to recov-
dispute
Lane's referral
fee
er
referral
fees from other REALTOR®
precisely
type
dispute
and Calhoun is
through
members
arbitration in the future.
contemplated by
among REALTORS®
only question
Membership Agreements. The
specifically
It
is true that Lane was not
Urgitus's
is whether Lane can enforce
and
third-party beneficiary
named as a
of the
promises to DMCAR to arbitrate
Calhoun's
Membership Agreements. Yet "it is not nee-
view,
my
dispute.
he can.
essary
party
specifically
that
the third
agreement.
referred to in the
It is sufficient
non-party
compel
A
can
arbitration if it
if the claimant
is a
member
the limited
third-party beneficiary
can
that
it is a
show
class that was intended to benefit from the
agreement.
Eagle
See
Commc'ns, Inc.,
contract."
v.
Smith
TCI
981
Ridge Condominium Ass'n v. Metro. Build
690,
Here,
(Colo.App.1999).
P.2d
698
ers, Inc.,
(Colo.App.2004)
98 P.3d
917
"limited class" of beneficiaries was defined
("A nonparty,
third-party
such as
beneficia
Membership Agreements
ry, may
scope
fall
within the
Code
Ethics as other members of the
may bring an action on
REALTOR®
with whom the
parties.");
if that
contract
is the intent of the
Seq,
might
member
have a
dispute.
business
Leadership,
Parker v.
15
Ctr.
Creative
Ass'n,
e.g.,
Collegiate
Bloom v. Nat'l
Athletic
(same);
(Colo.App.2000)
Ey
P.3d
298
(Colo.App.2004)(holding
93 P.3d
623-24
(Colo.
Vleet,
chner v. Van
870 P.2d
that a
University
student-athlete
at the
(same).
App.1998)
This is an unremarkable
Colorado could sue under the
of the
application of the
black-letter
rule that
NCAA,
binding
which were
on member
third-party
beneficiary may enforce
Colorado,
schools like
because "the NCAA's
See, eg.,
terms of a contract.
Jefferson
constitution, bylaws,
regulations
evi
County
Shorey,
Sch. Dist. No. R-1 v.
dence a clear intent
to benefit student-ath
(Colo.1992)
(describing
P.2d
letes").
third-party beneficiary doctrine
aas
"basic
law");
rule of contract
E.B. Roberts Constr.
Furthermore,
Lane's
from the
benefit
Inc.,
Contractors,
Co.
Concrete
direct,
Membership Agreements was
not inci
(Colo.1985) (applying
third-party
Membership Agreements specif
dental. The
doctrine).
beneficiary
In order
to enforce
ically contеmplate that a benefit of DMCAR
third-party
the terms of a contract as a
right
disputes
is the
to have
beneficiary,
plaintiff
show
must
the with other members arbitrated rather
than
contracting parties intended to benefit
litigated. Compare Shorey,
G85 however, majority binding of thе association as rules and creates new rule of imputed promises, constructively finding on the members. promise subsequent arbitrate contracts former, regard With association, private between members of a *13 imputed majority the to the bylaws the impose duty. of which such a hardly referral contract can be described as performance Sensing perhaps novelty a condition of at all. It is clear of this propo sition, ly separate promise offers, in majority or term its own in reliance on our BRW, holding Sons, Inc., in Dufficy Inc. v. Lord, & right. A. See 13 Richard Williston on 2000) ("A (4th 66, promise (Colo.2004), Contracts 88:5 ed. 73 that "valid con a manifestation of an intention to act ... tractual is duties can arise out of a network of specified way agreements in a ... a condition involving commercially while sophisti event, occur, occur, parties." Maj. op. not certain to which must cated Dufficy 681. In excused, only by unless its nonoceurrence is before we held that the of care owed designing engineer City for a Denver performance a contract under bеcomes due."). Furthermore, by it implied project project is neither construction inspector, and its parties' the terms of the referral contractually to a sub-contractor obliged to implied by engineer's plans nor extrinsic evidence of the actu followthe specifications, and Instead, majori parties.3 al intent of the was defined project the interrelated con it, law, ty imputes tracts, sepa as a matter of from which therefore also limited the sub promises rate to the association to arbitrate contractor's remedies for economic loss. The proposition with fellow members. transformation of that into a rule imputing private contracts the parties may we have allowed that While voluntary only associations is not unwarrant bound, cireumstances, by under limited cus by anything opinion ed in Dufficy our but industry practice, tom or at the same time dramatically governing pri alters settled law parties only we have held that must not Lee, vate associations. See Scott v. 208 Cal. have known of the custom but must havе (1962)(find 12, 824, App.2d Cal.Rptr. 24 826 contracted with it. reference to See Garman ing that association rules failed to create a Conoco, Inc., 652, (Colo.1994); 660 against contract enforceable one member Gill, 294, 297, Fleming v. 60 Colo. 158 P. cf. another); Masonry see also Savoca Co. v. (1915) (refusing specific 88-89 to alter Co., Homes & Son Constr. Ariz. commission on basis of custom Scott); (relying Coyle P.2d on among Denver real estate brokers to divide Co., v. Morrisdale Coal 284 F. commissions). event, any these are mat (S.D.N.Y.1922) ("At common law it is the fact, ultimately subject ters of to the intent of general rule that the members of an unineor- any particular contract. See may porated association not sue at law one of Co., Pittman v. Larson Distrib. their number on a contract between himself (Colo.App.1986). 1884-85 The district them."); Rauhr, McMahon v. 47 N.Y. court no made such factual determinations in (1871) ("A voluntary member of case, aught appears and for ... ... cannot maintain an ac [association] allegations prior about their law, association, tion at behalf of the dealings cursory, or the terms of their e-mail against upon any agreement another member agreement,4 referral there is little reason to association."). made with the promise believe such a was intended. Rath majority's er than specific regard look the terms of the claim of With and, if appropriate, support treating referral from settled law formation, surrounding provisions circumstances its associations as bind- exist, certainly 3. Such extrinsic evidence could kind, REALTOR® association consists of a any but the court district issued its arbitration order stating, two-line email from to Lane fact, law, any findings without conclusions of "Bob, Per our conversation CB Richard Ellis matter, any explanation or for whatsoever. agrees pay Realty a Lane referral fee of 20% any going Weberg. on deals with John P. forward only any agreement 4. written evidence of you." any questions. Please call me with Thank between one that never mentions parties, 68§G "eminently fit for the asso majority penalty are members, priate I believe the
ing on their
determine");
import
those
Van Valken
сiation itself
similarly misperceives
A.M.,
upon which
A.F.
Ironically,
Liberty Lodge
the rule
No. 300
&
burg v.
authorities.
Neb.App.
Jorgensen
619 NW.2d
Re
appeals relied
the court of
Box,
(Colo.App.
P.2d 1256
alty, Inc. v.
with the
("Generally courts will not interfere
1985)-that
relationship
a volun
to settle
affairs of an association
internal
is a con
its members
tary
association
regard to
or with
disputes between members
and,
organiza
by joining such an
provided
tractual one
government,
discipline or internal
to its rules
tion,
agrees to submit
a member
association is
government of the
obligations
and assumes
regulations
conformity
fairly
with its
administered
membership-should
have caused
incident
*14
proper
applicable law and no
laws and other
in
interference
to decline
the district court
violated.").
rights
ty or civil
have been
finding rather
than
association matters
by
jurisdictions noted
the six other
Of
between asso
agreement
binding contractual
rationale,
support
for its
three
majority as
when faced
Jorgensen,
members.
ciation
held,
appeals
along with our court of
merely
challenge to a realtor asso-
with a member's
member-parties
that the
were
Jorgensen,
of an arbitration
resolution
clation's
comply with their own association's
bound to
of Ethics and
according to its own Code
Smith, 76
Rogers Realty, Inc. v.
bylaws. See
Manual,
appeals
of
held
the court
Arbitration
King v. Larsen
(Okla.Civ.App.2008);
P.3d 71
clearly arbitrary and
the absence
that "[in
349,
Inc.,
rights,
Cal.App.3d
aof member's
175 Cal.
Realty,
121
unreasonable invasion
Dial-A-House,
(1981);
226
Bastone v.
operation
Rptr.
the internal
not review
courts will
1026,
Inc.,
tionally shown to associations of all
kinds. reasons, largely
For the same I can take third-party beneficiary
little comfort Despite resignations arising 5. and Cal- bers while were still members. See houn, purported 5(a). association Bylaws art. VI bind them to arbitrate with other mem-