Perfect Place, a Colorado limited liability company, Plaintiff-Appellant and Cross-Appellee, v. R. Parker Semler, Defendant-Appellee and Cross-Appellant.
Court of Appeals No. 15CA0918
COLORADO COURT OF APPEALS
October 20, 2016
2016COA152
Honorable Catherine A. Lemon, Judge
City and County of Denver District Court No. 13CV32699
Division V
Opinion by JUDGE FREYRE
Román and Lichtenstein, JJ., concur
Announced October 20, 2016
Podoll & Podoll, P.C., Richard B. Podoll, Robert C. Podoll, Robert A. Kitsmiller, Greenwood Village, Colorado, for Plaintiff-Appellant
Semler & Associates, P.C., R. Parker Semler, Andrew Oh-Willeke, Jeremy Goldblatt, Denver, Colorado, for Defendant and Cross-Appellee
¶ 2 In this quiet title action, plaintiff, Perfect Place, LLC, (a member of the Blake Street homeowner‘s association) appeals the trial court‘s judgment finding that defendant, R. Parker Semler, owns parking spaces C and D in the 1940 Blake Street Condominium (Blake Street) property.1 Semler cross-appeals the court‘s equitable enlargement of the historical dimensions of parking space E and its corresponding decrease in the size of parking space D. He also seeks an award of attorney fees under CCIOA. We affirm the trial courts finding that the parking spaces were properly subdivided and that Semler owns spaces C and D. However, because we conclude that the trial court erred when it
I. Background
¶ 3 This case arises from a quiet title action in which Perfect Place asserted ownership of three parking spaces in the Blake Street property. In 2000, Blake Street bought a mixed use residential and commercial building and recorded a written declaration subjecting the property to the provisions of CCIOA. Thereafter, Blake Street sold a majority interest in the building to Quail Street Company, LLC (Quail Street). Quail Street‘s principal аnd sole shareholder was John Watson. Watson owned the majority of the building for several years and made multiple changes to it, including subdividing the garage into three individual parking spaces (C, D, and E) by painting yellow dividing lines on the garage wall. Spaces C and D were full-sized parking spaces and accommodated normal-sized vehicles. Space E was smaller and was only able to accommodate a motorcycle or a very small car.
¶ 4 Over time, Watson sold the individual parking spaces (as part of condominium units) to different buyers, who subsequently sold
¶ 5 The subsequent title transfers are set forth in detail in Appendices 1 and 2. As relevant here, Semler claimed title to space C from a 2007 foreclosure proсeeding in which he paid $641,0002 during the redemption period and obtained a deed in lieu of foreclosure. Semler claimed title to space D through a different foreclosure proceeding in which he obtained a deed in lieu of foreclosure from the record owner.
¶ 6 In 2010, the association‘s attorney notified Semler and Perfect Place of clouded title concerning spaces D and E. Thereafter, Semler paid more than $35,000 for a quitclaim deed from the former record owner of space D and recorded that deed in 2012. He claimed title to space E from a different deed in lieu of foreclosure that stemmed from an unlawful conveyance and that became part of the same 2007 foreclosure proceeding. See infra Part IV.
¶ 8 Perfect Place also claimed title to spaces D and E from a series of conveyances originating from a wild deed, see infra Part IV. It paid ten dollars to Newtown Ten for a quitclaim deed purporting to convey spaces “D and/or E.”
¶ 9 Perfect Place brought this quiet title action asserting superior title to all three spaces based on the 2011 quitclaim deed. It further alleged that all previous conveyances of the spaces were invalid because Watson had never properly subdivided the garage in accordance with the provisions of CCIOA.
¶ 10 Semler contended that Watson properly subdivided the garage, that Perfect Place obtained the 2011 quitclaim deed from Watson through fraudulent misrepresentations, and that Perfect Place was not a bona fide purchaser for value because it only paid ten dollars for the 2011 quitclaim deed.
¶ 11 After a three-day hearing, the trial court found that Watson subdivided the garage unit into three separate parking spaces. It also found that Perfеct Place procured the 2011 quitclaim deed by fraud, concealment, and unclean hands. The court therefore concluded that Semler was the rightful owner of spaces C and D.
¶ 12 Title to space E was resolved in favor of Perfect Place by agreement of the parties after Perfect Place reached a pretrial settlement with defendants Kari and Nathan Peters. Finding that the equities weighed in favor of Semler, the court ordered him to draft a proposed amendment to the Blake Street declaration, including a new map depicting the boundaries of the three spaces. It intended for Semler to record the amended map and to submit it to the homeowners association for inclusion in the Blake Street declaration.
B. Post-Trial Orders
¶ 13 Pursuant to the trial court‘s order, Semler submitted a proposed map allotting space C 132 square feet, space D 132 square feet, and space E 90 square feet. In computing these dimensions, Semler relied on the historical boundaries of spaces C
¶ 14 Perfect Place objected to Semler‘s proposal and argued that “everyone understood that there were to be 3 parking spaces in the Parking Space Unit,” and that “[t]he map proposed by Semler would effectively prevent [it] from using parking space E as a parking space.” Perfect Place submitted its own proposed map that would “accommodate three cars” and that “properly indicated a large brick pillar between spaces C and D.” It also requested an evidentiary hearing.
¶ 15 The trial court began the hearing by noting that the weight of the trial evidence suggested that space E was a usable parking space for a small car, and that it intended, as an equitable matter, to create three usable parking spaces in order to avoid future litigation. After the hеaring, the court found that space E had always been smaller than spaces C and D, and it again acknowledged that the balance of the equities weighed in favor of Semler. In its final order, however, the court adopted a map that
II. Propriety of Subdivision Under CCIOA
¶ 16 Perfect Place contends that the absence of a formal application to the association‘s board describing a reapportionment of the common elements, as well as the absence of an amended declaration or condominium map that strictly complies with CCIOA, violates
¶ 17 After trial, the court found that one of two events occurred to subdivide the garage: (1) either the original declarant subdivided the garage when it filed the original declaration or (2) the first purchaser and majority unit holder, Watson, subdivided the garage into three spaces — C, D, and E — when he placed physical demarcation lines on the garage wall separately identifying each
¶ 18 We conclude the record supports the trial court‘s finding that Watson subdivided the garage into three separate parking spaces and that Watson substantially complied with the provisions of CCIOA when doing so. Because minor deficiencies should not render otherwise marketable title unmarketable, we further conclude that substantial compliance with the requirements of
A. Statutory Interpretation
¶ 19 We review issues of statutory construction de novo. See Gagne v. Gagne, 2014 COA 127, ¶ 25. We review a court‘s factual
¶ 20 In interpreting a statute, our primary objective is to ascertain and effectuate the intent of the General Assembly. Specialty Rests. Corp. v. Nelson, 231 P.3d 393, 397 (Colo. 2010). “If the statutory language is clear, we interpret the statute according to its plain and ordinary meaning.” Id. We read words and phrases in context and construe them according to their common usages. Gagne, ¶ 25. We also interpret a statute in a way that best effectuates the purpose of the legislative scheme. Id. at ¶ 26. When construing a statute, we read and consider the statute as a whole and interpret it in a manner that gives consistent, harmonious, and sensible effect to all of its parts. Id.
¶ 21 “Not all directives and requirements declared in statute law should be understood to have equal force[;]” therefore, “[w]hether less than full compliance with particular provisions is permitted is an issue of statutory construction.” Wainscott v. Centura Health Corp., 2014 COA 105, ¶ 24 (quoting 3 Norman J. Singer & J.D. Shambie Singer, Sutherland Statutory Construction § 57:1, at 6
¶ 22 In determining whether a particular statutory requirement has been satisfied, courts have imposed a degree of compliance consistent with the objective sought to be achieved by the legislation under consideration. Woodsmall, 800 P.2d at 67; see, e.g., People v. Stanley, 169 P.3d 258, 261 (Colo. App. 2007) (holding that substantial compliance is “actual compliance [with] respect to the substance essential to every reasonable objective of the statute, as distinguished from mere technical imperfections of form” (quoting People v. Jacobs, 729 P.2d 757, 763-64 (Cal. 1987))). If the statute requires only substantial compliance, a сourt must then consider whether “the allegedly complying acts fulfilled the statute‘s purpose.” Grandote Golf & Country Club, LLC v. Town of La Veta, 252 P.3d 1196, 1203 (Colo. App. 2011); see also Bd. of Cty. Comm‘rs v. City & Cty. of Denver, 193 Colo. 325, 327-30, 566 P.2d 335, 337-38 (1977) (finding a statutory requirement that a map and a school board resolution accompany an annexation petition was substantially complied with where the map and resolution were available to the city council when it considered the petition).
B. Substantial or Strict Compliance
¶ 23 In enacting CCIOA, the General Assembly intended a “clear, comprehensive, and uniform framework for the creation and operation of common interest communities.”
¶ 24 While one goal of CCIOA is uniformity, the General Assembly has balanced that goal against the goal of flexibility, indicating that
¶ 25
(2) In order to subdivide a unit, the unit owner of such unit, as the applicant, must submit an application to the executive board, which application shall be executed by such owner and shall include:
(a) Evidence that the applicant of the proposed subdivision shall have complied with all building codes, fire codes, zoning codes, planned unit development requirements, master plans, and other applicable ordinances
(b) The proposed reallocation of interests, if any;
(c) The proposed form for amendments to the declaration, including the plats or maps, as may be necessary to show the units which are created by the subdivision and their dimensions, and identifying numbers;
(d) A deposit against attorney fees and costs which the association will incur in reviewing and effectuating the application, in an amount reasonably estimated by the executive board; and
(e) Such other information as may be reasonably requested by the executive board.
(3) No subdivision of units shall be effected without the necessary amendments to the declaration, plats, or maps, executed and recorded pursuant to
section 38-33.3-217(3) and (5).(4) All costs and attorney fees incurred by the association as a result of an application shall be the sole obligation of the applicant.
(Emphasis added.)
¶ 26 This language clearly requires an owner to submit an application to the executive board that includes evidence of
¶ 27 While courts typically construe the terms “shall” and “must” as mandatory, these phrases are not dispositive in determining whether a statute requires substantial compliance. See, e.g., Finnie, 79 P.3d at 1256 (finding that, under Colorado‘s governmental immunity statute
¶ 28 Further, while the statute states that subdivision will not be effected without corresponding amendments to the declaration or the recorded map, it does not provide any consequence for noncompliance with its other provisions. This omission, therefore, suggests that the statutory language is discretionary rather than mandatory. See In re Marriage of Slowinski, 199 P.3d 48, 52 (Colo. App. 2008) (“The crucial difference between statutes considered discretionary and those deemed mandatory is the consequence of noncompliance.“). To be sure, the plain language of
¶ 29 First, applying rules of statutory construction, we consider CCIOA as a whole. See also People v. Dist. Court, 713 P.2d 918, 921 (Colo. 1986) (“To reasonably effectuate the legislative intent, a statute must be read and considered as a whole.“). In doing so, we discern that
¶ 30 For example, under CCIOA, amendments to a declaration typically require the approval of at least fifty percent, but not more than sixty-seven percent, of the association members. See
¶ 31 Moreover, the application serves to assure the board that the subdivision complies with applicable laws and that it will be properly memorialized in the recorded map or declaration. Once recorded, the map then alerts title companies, taxing authorities, and other interested parties of the existence of the new unit.
¶ 32 Because
¶ 33 This interpretation is consistent with the General Assembly‘s purpose in enacting CCIOA. A written summary of the purposes for enacting CCIOA, prepared by the chair of the drafting committee, James Winokur, shows that the General Assembly did not intend rigid or hyper-technical interpretations of the statute. See Background and Summary of Basic Provisions, Hearings on H.B. 1292 before the H. Judiciary Comm., 58th Gen. Assemb., 1st Sess. (Mar. 11, 1991) (report of James L. Winokur, Chair, CCIOA Drafting Committee). Instead, it aimed to avoid technical defects that would render title unmarketable. Id. Indeed, the purpose of
¶ 34 Consistent with these legislative goals, the General Assembly incorporated the principles of equity and flexibility into CCIOA. See
¶ 35 Thus, both the statutory scheme and the legislative history demonstrate that, while uniformity is important, statutory interpretations of CCIOA should give way to flexibility where strict adherence to provisions that create uniformity would render title unmarketable.
¶ 36 In sum, we conclude that the purpose of
¶ 37 Accordingly, we conclude that because the statutory scheme and legislative history of CCIOA favor flexibility, and because an insubstantial failure to comply with technical requirements should not render title unmarketable,
C. Application
¶ 38 With these conclusions in mind, we address the degree of compliance necessary here. To determine whether there has been substantial compliance with a statute, we consider whether the allegedly complying acts fulfilled the statute’s purpose. Town of La Veta, 252 P.3d at 1203.
¶ 39 Here, the trial court found that Watson substantially complied with the statute because, as the majority owner and board member of the homeowner’s association, any application for subdividing the garage would have been submitted to him for his approval. The trial court recognized that the declaration gave him the authority, as the first purchaser from the grantor, to subdivide the garage. It further noted that most of the provisions of
¶ 40 We conclude that Watson’s status as both property owner and majority-holding board member satisfies the application requirements of
¶ 41 The record also shows that Watson painted dividing lines in the garage to establish three parking spaces. Because neither party
¶ 42 Next, the record includes the declaration, which contains a subdivision of unit clause that provides for division of the common ownership “in the ratio that the square footage area of each new unit bears to the total square footage area of the original unit,” thereby demonstrating the proper allocation of interests. It further shows that the association assessed dues for each parking space based on the size and percentage ownership of each space in accordance with the declaration. This ongoing assessment of dues demonstrates that the association knew the size and percentage ownership of each space. Accordingly, we reject Perfect Place’s argument that the subdivision was nullified by the absence of an amendment reallocating interests under
¶ 43 Next, we consider whether the recorded map complies with
¶ 44 Because the record shows that Watson testified about his intention to subdivide the garage, that the declaration gave Watson the authority to subdivide the units, and that a map identifying the spaces was recorded consistent with his decision to subdivide the garage, we conclude that Watson substantially complied with the provisions of
¶ 45 Both parties assert that the trial court abused its discretion in crafting equitable relief. Perfect Place contends that the court abused its discretion when it (1) reformed the deeds of Watson and Quail Street to validly convey property; (2) found that Watson and Quail Street were alter egos; and (3) voided the 2011 quitclaim deed from Watson to Perfect Place by declaring it a fraudulent conveyance.
¶ 46 Semler contends the trial court abused its equitable discretion when it awarded twenty more inches to space E (and Perfect Place) because, in so doing, the court gave the party with unclean hands a benefit to the detriment of the party with clean hands. We conclude the trial court did not abuse its discretion in reforming the deeds or in voiding the fraudulent conveyance from Watson to Perfect Place. However, we conclude the court’s award of additional area to space E (and Perfect Place) was an abuse of discretion because this equitable remedy benefitted a party with unclean hands.
A. Standard of Review
¶ 47 Actions to quiet title under C.R.C.P. 105 are equitable proceedings. See Keith v. Kinney, 961 P.2d 516, 518 (Colo. App. 1997). “[T]he power to fashion equitable remedies lies within the discretion of the trial court.” La Plata Med. Ctr. Assocs., Ltd. v. United Bank of Durango, 857 P.2d 410, 420 (Colo. 1993). A trial court’s discretion, however, is not unlimited. Lewis v. Lewis, 189 P.3d 1134, 1141 (Colo. 2008), as modified on denial of reh’g (Aug. 18, 2008). We review the trial court’s findings of fact for an abuse of discretion, but we review de novo whether the trial court “correctly understood the appropriate test [for the equitable remedy].” Id.
B. Deed Reformation
¶ 48 Quiet title actions are governed by C.R.C.P. 105, which authorizes “[a]n action . . . brought for the purpose of obtaining a complete adjudication of the rights of all parties thereto, with respect to any real property and for damages, if any, for the withholding of possession.” C.R.C.P. 105(a). Such actions sound in equity and are governed by equitable principles. FDIC v. Mars, 821 P.2d 826, 830 (Colo. App. 1991); Nielsen v. Woods, 687 P.2d 486, 489 (Colo. App. 1984); see also Keith, 961 P.2d at 518 (“Actions to quiet title оriginated as claims in equity to invalidate claims adverse to the claimant.“). A court considering such a claim is tasked with
¶ 49 In exercising its discretion, a trial court may be called upon to reform a deed to quiet title. When considering “whether the record supports [a] trial court’s order of reformation,” a reviewing court “must determine whether the record contains sufficient evidence of the parties’ intentions to permit reformation of [the written instrument].” Md. Cas. Co. v. Buckeye Gas Prods. Co., 797 P.2d 11, 13 (Colo. 1990) (citing Page v. Clark, 197 Colo. 306, 313, 592 P.2d 792, 796 (1979)); Page, 197 Colo. at 313, 592 P.2d at 796 (trial court’s factual findings must be upheld on appeal unless so clearly erroneous as to be unsupported by the record). “Reformation of a written instrument is appropriate only when the instrument does not represent the true agreement of the parties and the purpose of reformation is to give effect to the parties’ actual intentions.” Md. Cas. Co., 797 P.2d at 13.
¶ 50 “[M]utual mistake of fact is [one ground] for reformation,” prоvided that “the mutual mistake does not express the true intent
¶ 51 Here, because Watson treated himself and his business entity, Quail Street, as one, title was clouded without reformation of the deeds. Quail Street deeded parking spaces to Watson, who then conveyed them in the name of Quail Street to third parties. The court found, with record support, that because Watson was the sole shareholder of Quail Street, he inadvertently deeded parking spaces from Quail Street that should have been from him, and deeded spaces from him that should have been deeded from Quail Street. It also found that Watson relied on title companies to ensure that he was deeding the properties from the correct entity, and, thus,
¶ 52 We discern no abuse of discretion. Consistent with the trial court’s actions, a division of this court has noted that a proper basis for reformation arises when both parties mistakenly believe that a deed identified the correct owner or grantor. See Ranch O, LLC v. Colo. Cattlemen’s Agric. Land Tr., 2015 COA 20, ¶¶ 17-21 (holding that reformation of a conservation deed to reflect that the actual owner of the property, an LLC, was the grantor of the conservation easement was proper given that both parties “mistakenly believed that it correctly identified the grantor and that the grantor had the authority to convey the conservation easement“). Further, the trial court’s factual findings are supported by the record. Accordingly, because the record shows Watson mistakenly conveyed the parking spaces in his and Quail Streets’ names, and because other parties could have reasonably believed he was the correct signor for either Quail Street or himself, the trial court did not abuse its discretion in reforming the deeds.
C. Alter Egos
D. Deed Voided by Fraud
¶ 54 Perfect Place contends that the trial court abused its discretion by finding that the 2011 quitclaim deed from Watson to Perfect Place was an invalid instrument because its conveyance involved fraudulent misrepresentations. Specifically, Perfect Place contends that Semler lacks standing to challenge the validity of the 2011 quitclaim deed, and further contends that even if it was procured by fraud, the deеd would be voidable, not void, under the law. Semler responds that the record supports the trial court’s finding that Perfect Place’s attorney misrepresented the circumstances surrounding the 2011 quitclaim deed and, thus, that this deed is void.
¶ 55 For the reasons stated below, we conclude that the trial court properly voided the quitclaim deed by finding that the
1. Standing
¶ 56 We first address Perfect Place’s standing argument and conclude that Perfect Place mistakenly confuses the trial court’s finding of a fraudulent conveyance with a finding of fraud. Indeed, Semler did not plead fraud, nor did the court enter judgment on or award damages for a claim of fraud. But he need not plead fraud in order to assert a legal right to the parking spaces that was superior to Perfect Place’s right. Under the circumstances here, Semler’s superior right was based on the theory that Perfect Place obtained title through a fraudulent conveyance, and the court was required, under C.R.C.P. 105(a), to fully adjudicate the rights of all interested parties. “Even if a counterclaim is not pled, or an issue is not raised in the pleadings but is apparent from the evidence, the court
2. Deed Voided for Fraud
¶ 57 Colorado courts have consistently recognized the important distinction between a void deed and a deed that is merely voidable. See Delsas v. Centex Home Equity Co., 186 P.3d 141, 144 (Colo. App. 2008); see also Upson v. Goodland State Bank & Tr. Co., 823 P.2d 704, 705 (Colo. 1992); Svanidze v. Kirkendall, 169 P.3d 262, 266 (Colo. App. 2007). “A void deed is a nullity . . . from the beginning, for any purpose” and “does not, and cannot, convey title, even if recorded.” Delsas, 186 P.3d at 144. “In contrast, a voidable deed conveys property and creates legal title unless, and until, it is set aside by the court.” Id. Thus, a good faith purchaser asserting an ownership interest under a voidable deed will be protected. Id.
¶ 58 In Colorado, a deed procured by “fraud in the factum” is void. Id. “Fraud in the factum” exists when “a person has been fraudulently deceivеd about the nature of a document, so that he or she is excusably ignorant about what has been signed.” Id. (citation omitted). Compare id. at 145 (finding a material issue of fact existed about whether a warranty deed was void for “fraud in the
¶ 59 Here, the record supports the trial court’s finding that the 2011 quitclaim deed from Watson to Perfect Place was a fraudulent conveyance. Watson believed that the quitclaim deed merely corrected a technical defect in title from an earlier conveyance and told Perfect Place’s attorney, “I don’t own anything there. I haven’t for years. I sold it all a long time ago.”
¶ 60 Additionally, Perfect Place’s attorney fostered Watson’s belief that the deed was intended only to correct technical defects by representing that Perfect Place lawfully owned all three parking
¶ 61 Accordingly, we conclude the record supports the trial court’s finding that the quitclaim deed was obtained by fraud and specifically by “fraud in the factum.” Because a deed obtained by “fraud in the factum” is void, Delsas, 186 P.3d at 144, we need not address the distinction between a void and a voidable deed and, therefore, affirm the court’s finding of a fraudulent convеyance.
E. Amendment of the Declaration Map
¶ 62 Semler contends that the trial court abused its discretion when it increased the size of space E at the expense of his space D, thereby benefitting Perfect Place, a party it had found to have unclean hands. We agree and conclude that although the court retains broad discretion in determining matters of equity, it may not award equitable relief to benefit a party with unclean hands.
1. Unclean Hands
¶ 64 Whether a party acted with unclean hands is a question of fact. Id. at 520. Because equitable matters are entirely discretionary, it is within the trial court’s discretion not only to determine whether sufficient facts support a finding of unclean hands, but also to decide whether to grant equitable relief. Id. Accordingly, the court’s decision whether to invoke the unclean hands doctrine is reviewed for an abuse of discretion. See id. A
2. Analysis
¶ 65 As noted, C.R.C.P. 105 requires the trial court to adjudicate all matters and afford the parties complete relief. Thus, a trial court may properly amend boundaries in a declaration map as part of its equitable power under this rule. Here, however, the trial court explicitly found that Perfect Place came to court with unclean hands concerning its claim to the parking spaces, including space E. This finding, therefore, precluded the court not only from adding square footage to space E, but also from removing squarе footage from space D. Accordingly, the trial court’s amendment resulted in bestowing an unfair benefit to Perfect Place, the party with unclean hands, and an unfair detriment to Semler, contrary to law. See Salzman, 996 P.2d at 1269 (finding that a party’s unclean hands
¶ 66 The trial court’s amendment of the map was also manifestly unreasonable. The record demonstrates that space E had always been a smaller space than spaces C and D. Indeed, Watson testified that space E was “exceptionally small,” and “motorcycle width.” The trial court noted that space E should be smaller than spaces C and D, not only based on the historical boundaries, but also based on its finding that the balance of equities weighed in favor of Semler. Yet, inexplicably, it adopted dimensions contrary to these findings that resulted in space E receiving thirty-two square feet more space than it was originally allotted and space D receiving eighteen square feet less space than it was originally allotted. The trial court’s amendment contradicted its findings and was therefore manifestly unreasonable.
¶ 67 Finally, the trial court’s establishment of the parking space boundary lines was arbitrary. The record reflects that as early as 2002, painted lines marked the boundaries between each parking space. Indeed, the trial court found that “Watson went to the parking garage and physically marked off the separate parking
¶ 68 Accordingly, we conclude that while the trial court had broad discretion to order equitable relief, it abused its discretion when it amended the map in favor оf the party with unclean hands and when it adopted boundaries contrary to the evidence in the record. We reverse the trial court’s boundary findings and remand the case for redetermination of the boundary lines consistent with their historical dimensions.
IV. Resulting Chain of Title
¶ 69 Both Perfect Place and Semler claim superior title to the parking spaces. Thus, we review the chain of title to each space
A. Standard of Review and Law
¶ 70 Interpretation of a written document presents a question of law subject to de novo review. See Bolser v. Bd. of Comm’rs, 100 P.3d 51, 53 (Colo. App. 2004); Collins v. Colo. Mountain Coll., 56 P.3d 1132, 1135 (Colo. App. 2002). In construing a deed, a court’s paramount purpose is to ascertain the parties’ intent. Notch Mountain Corp. v. Elliott, 898 P.2d 550, 557 (Colo. 1995). “We must not ascertain intent from ‘portions presented in isolated sentences and clauses,’ but from the deed as a whole.” Michaelson v. Michaelson, 939 P.2d 835, 839 (Colo. 1997) (quoting Notch Mountain Corp., 898 P.2d at 557); see Percifield v. Rosa, 122 Colo. 167, 177, 220 P.2d 546, 551 (1950); Bolser, 100 P.3d at 53.
¶ 71 The plaintiff in a quiet title action has the burden of establishing title superior to that claimed by the defendant. Hutson v. Agric. Ditch & Reservoir Co., 723 P.2d 736, 738 (Colo. 1986); see also Hinojos v. Lohmann, 182 P.3d 692, 697 (Colo. App. 2008). Thus, the plaintiff may not capitalize on the weakness of the defendant‘s claim to title, but can only succeed by establishing the
B. Parking Space C
¶ 72 Watson or Quail Street first conveyed spaces C and D to Aspen Equestrian for valuable consideration in a warranty deed recorded on July 24, 2004. Aspen Equestrian conveyed space C to Corey Salankey by a special warranty deed recorded on July 28, 2006. The public trustee foreclosed on space C on October 16, 2007. During the redemption period, Semler paid the balance of Salankey‘s loan and received title to space C on January 20, 2008. The record does not reflect any subsequent conveyance of space C. See infra Appendix 1.
C. Parking Space D
¶ 73 Aspen Equestrian conveyed space D to Shanoah Blake by a special warranty deed recorded on September 27, 2006. Blake
¶ 74 In a wild deed,8 Jay Weinberg purported to convey sрace D to Trend Investments in a special warranty deed recorded on March 13, 2009. Weinberg was the principal and sole shareholder of Trend Investments. On the same day, Trend Investments conveyed space D to Newtown Ten (of which Weinberg was the principal and sole shareholder) by special warranty deed. However, the deed recorded on March 19, 2009, purported to convey space “D and/or E” to Perfect Place (from Newtown Ten) by a quitclaim deed for ten dollars consideration. See infra Appendix 2.
¶ 75 We conclude that Semler‘s title to space D is superior to Perfect Place‘s title for three reasons. First, Perfect Place‘s title stems from a wild deed beginning with Weinberg, who thereafter conveyed title to two entities he owned before finally conveying title to Perfect Place. Second, Perfect Place‘s receipt of a quitclaim deed for ten dollars called into question Perfect Place‘s status as a bona fide purchaser for value. See In re Marriage of Allen, 724 P.2d 651, 659 (Colo. 1986) (holding that to become a bona fidе purchaser a party must also give adequate consideration, or value, to gain legal and equitable title). Finally, Perfect Place was not a bona fide purchaser because it had constructive notice, through Blake‘s recorded 2006 deed, that Newtown Ten had no legal title to space D. See Ranch O, LLC, ¶ 30 (stating that the purpose of Colorado‘s race-notice statute is “to protect purchasers of real property against the risk of prior secret conveyances by the seller and to allow a purchaser to rely on the title as it appears of record“); see also Franklin Bank, N.A. v. Bowling, 74 P.3d 308, 313 (Colo. 2003) (“When a party properly records his interest in property with the appropriate clerk and recorder, he constructively notifies ‘all the world’ as to his claim.“).
¶ 76 In contrast, Semler received title to space D directly from Blake‘s recorded deed and had no notice of either Trend Investments’ or Newtown Ten‘s conveyances to Perfect Place. Collins v. Scott, 943 P.2d 20, 22 (Colo. App. 1996) (holding that recording a deed is “notice only to those persons claiming under the same chain of title who are bound to search for it” and that “[d]ocuments outside the chain of title provide no notice unless a
D. Parking Space E
¶ 77 While neither party explicitly challenges Perfect Place‘s ownership of space E, we note that some of our findings necessarily affect space E‘s title. As previously discussed, the trial court found that thе 2011 quitclaim deed did not validly convey title in space E to Perfect Place. Rather, the trial court found that Perfect Place owned space E by an agreement of the parties that was based on a pretrial settlement between Perfect Place and Nathan and Kari
V. Attorney Fees
¶ 78 Semler requests attorney fees on appeal and contends the trial court erred when it denied his motion for attorney fees and costs at trial. Perfect Place contends that Semler is not entitled to attorney fees because it did not bring this action under CCIOA. We conclude that Semler should be awarded trial and appellate attorney fees because he was required to “defend” his title under the provisions of CCIOA.
¶ 79
In any civil action to enforce or defend the provisions of this article or of the declaration,
bylaws, articles, or rules and regulations, the court shall award reasonable attorney fees, costs, and costs of collection to the prevailing party.
(Emphasis added.) Thus, under this statute, a prevailing party in a CCIOA dispute is entitled to attorney fees. See Hallmark Bldg. Co. v. Westland Meadows Owners Ass‘n, Inc., 983 P.2d 170, 174 (Colo. App. 1999).
¶ 80 Both in the trial court and on appeal, Perfect Place argued that the garage was not properly subdivided under the provisions of CCIOA and, thus, that Semler never received valid title to the parking spaces. Semler was required, therefore, to defend his title under CCIOA. Because we conclude that the garage was properly subdivided under
¶ 81 We affirm the trial court‘s judgment quieting title to spaces C and D in Semler. We reverse the trial court‘s judgment adjusting the boundaries of spaces D and E. We remand the case for further proceedings under
JUDGE ROMÁN and JUDGE LICHTENSTEIN concur.