Cases of Note
Courts presume that the General Assembly is aware of court decisions that construe state statutes or the constitution. The OLLS will update this web page quarterly to notify the General Assembly of such court decisions. Cases that may be of particular interest because they meet certain criteria have been summarized and are listed below in chronological order. Summaries for cases older than a year are available in an archive.
Ragan v. Ragan, Colorado Court of Appeals No. 20CA0038 (May 27, 2021)
Holding: The Employee Retirement Income Security Act of 1974 (ERISA) precludes post-distribution claims brought pursuant to section 15-11-804 (8)(b), C.R.S., to recover insurance proceeds that were distributed to a former spouse who was the named beneficiary in the insurance policy.
Case Summary: At the time of the decedent's death, his ex-wife remained the named beneficiary of his employer-sponsored life and accidental death insurance policies. The policies are governed by ERISA. After the insurance proceeds were distributed to the ex-wife, the decedent's estate (estate) sued her under state law to recover those proceeds.
Section 15-11-804, C.R.S., is Colorado's divorce revocation statute. Section 15-11-804 (2)(a)(i) provides that any beneficiary designation of a then-spouse is automatically revoked upon divorce. Section 15-11-804 (8)(b) states that if any part of section 15-11-804 is preempted by federal law, a former spouse who received a payment that he or she is not entitled to under the statute is obligated to return that payment or he or she is personally liable for the amount of the payment to the person who would have been entitled to it were the statute or part of the statute not preempted.
Both the Colorado Court of Appeals, in an earlier case, and the United States Supreme court have held that an ERISA plan administrator must distribute benefits to the beneficiary named in the plan. ERISA prohibits benefits provided under a plan from being assigned or alienated. ERISA further contains an express preemption provision, which states that ERISA supersedes "any and all state laws insofar as they may now or hereafter relate to any employee benefit plan" covered by ERISA.
The estate acknowledged that ERISA preempts the state law providing for automatic revocation of an ex-spouse as a beneficiary, so the plan benefits must be distributed to the decedent's ex-wife as the named beneficiary. But the estate claimed that, under section 15-11-804 (8)(b), C.R.S., it could recover money after it was distributed. The court disagreed, finding that ERISA preempts a claim to recover proceeds after distribution under section 15-11-804 (8)(b).
First, there is no case law supporting the notion that ERISA allows a state law-based post-distribution claim to recover ERISA benefits. Second, in a similar case, the Washington Court of Appeals held that ERISA preempts Washington’s divorce revocation statute allowing for recovery of ERISA funds that had been distributed to the designated beneficiary. The court of appeals agreed with the reasoning of the Washington court that section 15-11-804 (8)(b), C.R.S., cannot revive the preempted automatic revocation requirement simply by doing an end-run around ERISA. Finally, the court of appeals found a U.S. Supreme Court case persuasive in which the Supreme Court concluded that the Federal Employees’ Group Life Insurance Act of 1954 preempted a provision of Virginia’s divorce revocation statute similar to Colorado’s. For these reasons, the court held that ERISA precludes post-distribution claims to recover the insurance proceeds from a former spouse pursuant to section 15-11-804 (8)(b). (For more information, contact Conrad Imel.)
People v. Cox, Colorado Court of Appeals No. 19CA2085 (May 13, 2021)
Holding: The general assembly has no authority to modify the affirmative defense in Article XVIII, Sec. 14 (2)(a) of the Colorado constitution.
Case Summary: A jury acquitted the defendant of marijuana cultivation, section 18-18-406 (3)(a)(I), C.R.S., and the district attorney appealed arguing that trial court erred in not supplementing the elements of the constitutional affirmative defense for medical marijuana with additional elements added by statute. The district attorney argued that the jury instructions for the affirmative defense should include the provisions in section 18-18-406 (3)(b) and (3.5), C.R.S., that require medical marijuana cultivation to occur in an enclosed and locked space and requires a primary care-giver cultivating medical marijuana to comply with section 25-1.5-106, C.R.S. The trial court rejected the district attorney's request to add those elements to the affirmative defense instructions.
The court of appeals affirmed the trial court's decision. The court of appeals found that the general assembly cannot modify the affirmative defense found in Article XVIII, Sec. 14 (2)(a) of the Colorado constitution. The statutory provisions make the affirmative defense harder to prove. Therefore, inclusion of those provisions would dilute the affirmative defense, and the general assembly has no authority to dilute constitutional rights. A statute that purports to add substantive elements to a defense defined in the constitution cannot trump the constitution. (For more information, contact Michael Dohr.)
People v. Garcia, Colorado Court of Appeals No. 17CA1911 (May 13, 2021)
Holding: Section 18-1-303, C.R.S., does not prevent a Colorado prosecution regardless of prior prosecution by a foreign country.
Case Summary: Defendant was convicted of first degree murder. The defendant and his wife separated, and his wife started a relationship with another man. The defendant threatened to kill the other man. He came to his wife's house with a shotgun when the man was present, and a fight started. The defendant stabbed the man in the back, and the man ran into the bedroom and locked the door. The defendant fired his shotgun through the locked door killing the man. The defendant then fled to Mexico. The district attorney's office attempted to have the defendant extradited to Colorado from Mexico without success. Then, the district attorney compiled a casebook and sent it to Mexico so the defendant could be prosecuted under Mexico's foreign prosecution law. The defendant was acquited of the murder in Mexico. Years later the defendant returned to Colorado, was arrested upon his arrival, and was subsequently tried and convicted of the man's murder.
Section 18-1-303, C.R.S., bars a Colorado prosecution when there has been a prosecution that resulted in a conviction or acquittal for the same conduct in the United States, another state, or a municipality. The statute does not include foreign countries in the list. The defendant argued that the Colorado Supreme Court's decision in People v. Morgan, 785 P.2d 1294 (Colo. 1994), requires dismissal of his case. In that case, the supreme court stated "[t]he better reading of section 18-1-303 uniformly abolishes the dual sovereignty doctrine, prohibiting prosecution uder Colorado law when the defendant has been subjected to prior prosecution by any separate sovereign - federal, state, or tribal". The court of appeals distinguished People v. Morgan finding that the holding is limited to only prosecutions by federal, state, or tribal authorities, not foreign authorities. Therefore, section 18-1-303, C.R.S., did not bar the defendant's subsequent Colorado prosecution. (For more information, contact Michael Dohr.)
Markwell v. Cooke, Colorado Supreme Court No. 20SC585 (March 15, 2021)
Holding: The requirement of article V, section 22 of the Colorado constitution that a bill be "read at length" is not satisfied when a chamber of the general assembly uses automated software to have multiple computers simultaneously give voice to different portions of a bill at a speed of about 650 words per minute. However, while a court has the authority to determine in a case before it whether a specific method actually used by a chamber of the general assembly to effectuate a "reading" complies with the reading requirement, the separation of powers doctrine prohibits a court from prescribing the form or manner in which the general assembly may comply with the reading requirement in the future.
Case Summary: Article V, section 22 of the Colorado constitution requires every bill to be read "at length on two different days in each house" but the requirement to read at length may be "dispensed with upon unanimous consent of the members present." While such unanimous consent is typically granted, during the 2019 legislative session, a senator requested that House Bill 19-1172, a 2,023-page recodification bill, (HB 1172) be read at length on second reading. In response, the secretary of the senate (secretary) directed senate staff to upload the bill to multiple computers and use automated software to recite different portions of the bill simultaneously at the maximum rate of approximately 650 words per minute. Four to six computers did this, creating an unintelligible recitation of the bill. The senator who had requested the reading at length and two other senators objected to this method of "reading" the bill and requested that the computers' recitation rate be slowed down. Both the secretary and the president of the senate (president) refused to do so, and the computers completed the recitation process a few hours later.
The objecting senators filed a complaint for injunctive relief and declaratory judgment against the secretary and the president in the Denver District Court. The district court quickly granted a temporary restraining order prohibiting the secretary and the president from: (1) "refusing to read legislation ... in an intelligible fashion" without the unanimous consent required to dispense with the reading requirement; and (2) passing HB 1172 in violation of article V, section 22 "by failing to read the bill out loud on two consecutive days." After determining that the case did not present a nonjusticiable political question and that the objecting senators had a reasonable probability of success on the merits, the district court entered a preliminary injunction requiring the secretary to comply with the reading requirement by using "a methodology that is designed to read legislation in an intelligible and comprehensive manner, and at an understandable speed." After the Senate passed HB 1172 in compliance with the court's requirements, the court made the injunction permanent and issued a declaratory judgment, stating that: (1) using multiple computers to read different portions of the bill simultaneously "at an incomprehensible speed" violates the reading requirement of article V, section 22; and (2) the secretary must read all future legislation "in an intelligible manner and at an understandable speed" if a senator objects to dispensing with the reading requirement. The parties then filed a joint motion seeking direct review by the Colorado Supreme Court.
The supreme court granted the joint motion for direct review and agreed to review the following issues: (1) Whether the district court erred by failing to find that the dispute over the manner of "reading" a bill is a nonjusticiable political question; (2) Whether the district court correctly granted injunctive relief to direct the manner of the Senate's reading of a pending bill; and (3) Whether the district court erred in granting declaratory relief in light of non-textual parameters it established to direct bill readings in the Senate for HB 1172 and future bills. The supreme court held that: (1) The dispute is justiciable because constitutional interpretation is "peculiarly within the province of the judiciary" and interpretation of article V, section 22 of the Colorado constitution "in no way transgresses the bounds of another branch of government;" (2) The "unintelligible sounds" produced by multiple computers rapidly reading different sections of HB 1172 simultaneously do not comply with the reading requirement because they do not conform with any definition of reading; and (3) The district court erred by prescribing requirements for the senate to follow in complying with the reading requirement in the future because "the separation of powers doctrine requires no less and permits no more than to have us interpret the constitution and determine whether the legislature complied with it [and] prohibits us from dictating to our coequal branch of government how to comply with the reading requirement moving forward." Two justices wrote separate dissents, both joined in by each other and a third justice. The first dissent stated that "the plain language of article V, section 22 simply requires that bills be 'read.' or uttered aloud. Nothing more." The second dissent stated that, to the extent that "read" is ambiguous, the majority decision showed "insufficient deference to the Senate's interpretation of a constitutional provision governing the internal affairs of the legislative branch" and that "[s]eparation of powers demands more than the majority's rule that courts can't tell the legislative branch what to do but can tell it what not to do." (For more information, contact Jason Gelender.)
---------------
In 2021, the Colorado Supreme Court decided three cases addressing common law marriage in Colorado. In In re Hogsett & Neale, 2021 CO 1, the supreme court refined the test for proving common law marriage articulated in People v. Lucero, 747 P.2d 660 (Colo. 1987) to reflect changed social and legal circumstances since Lucero was decided, including the recognition of same-sex marriage. In In re Marriage of LaFleur & Pyfer, 2021 CO 3, the supreme court recognized common law same-sex marriage and held that a court may recognize a same-sex marriage entered into before the state recognized same-sex couples' fundamental right to marry in October 2014. Finally, in In re Estate of Yudkin, 2021 CO 2, the supreme court remanded the case to the probate court to apply the refined test for common marriage to the intestate death of an alleged different-sex common law spouse.
In re Hogsett & Neale, Colorado Supreme Court No. 19SC44 (January 11, 2021)
Holding: The Colorado Supreme Court announced a revised Lucero test for proving common law marriage, finding that the test's current factors had become less reliable to distinguish marital and nonmarital relationships and that "the gender-differentiated terms and heteronormative assumptions in the Lucero test render it ill-suited for same-sex couples." Under the revised test, "common law marriage may be established by the mutual consent or agreement of the couple to enter the legal and social institution of marriage, followed by conduct manifesting that mutual agreement. The key question is whether the parties intended to enter a marital relationship--that is, to share a life together as spouses in a committed, intimate relationship of mutual support and mutual obligation." Courts should "give weight to evidence reflecting a couple's express agreement to marry. In the absence of such evidence, the parties' agreement to enter a marital relationship may be inferred from their conduct." The Lucero factors may still be relevant "but must be assessed in context; the inferences to be drawn from the parties' conduct may vary depending on the circumstances." The manifestation of the parties' agreement to marry "need not take a particular form." Applying the test, the supreme court upheld the lower courts' determination that Hogsett and Neale were not married at common law.
Case Summary: In re Hogsett & Neale involved two women who were in a 13-year relationship, from 2001 to 2014. They were never formally married. At the end of the relationship, the parties filed for divorce and mediated a separation agreement that included spousal maintenance and retirement assets. They dismissed the initial action when the court determined it would need to first find the existence of a common law marriage. When the separation agreement fell through, Hogsett filed again for dissolution of marriage, with Neale moving to dismiss, asserting that there was no common law marriage. Although the couple had a ceremony and wore rings expressing a committed relationship, purchased a home together, and had joint bank and credit accounts, the district court concluded that Hogsett had not met the burden of establishing common law marriage under the Lucero test. The court of appeals affirmed, noting that credible evidence supported both Hogsett's belief that she was married and Neale's lack of intent to be married. In applying the test, the district court and court of appeals both acknowledged that many of the Lucero test's indicia of marriage, such as joint tax filings and reputation in the community as a married couple, were unavailable to the couple prior to the U.S. Supreme Court's decision in Obergefell v. Hodges, 576 U.S. 644 (2015), which held that states cannot deprive same-sex couples of the fundamental right to marry. (Colorado recognized same-sex marriage approximately eight months before Obergefell as a result of the Tenth Circuit's decision in Kitchen v. Herbert, 755 F.3d 1193, 1229-30, (10th Cir. 2014).) The Colorado Supreme Court granted certiorari to review the factors that a court should consider in determining whether a common law marriage exists between same-sex couples.
Possible Considerations for General Assembly: The district court, court of appeals, and supreme court all noted that Colorado is one of only ten states that has not abolished common law marriage. While the courts acknowledged that the abolition of common law marriage was not before the courts, the courts questioned the continued usefulness of common law marriage given the general accessibility of licensed marriage, the trend toward more egalitarian marriages, and the law's equal treatment of children born to unmarried parents. Further, the Colorado courts noted that common law marriage cases use judicial resources and are "fact-intensive and invasive," forcing judges to "assess the degree to which a couple's conduct conforms to marital ideal." Concurring opinions from the courts called on the legislature to abolish common law marriage. (For more information, contact Brita Darling.)
In re Marriage of LaFleur & Pyfer, Colorado Supreme Court No. 19SC1004 (January 11, 2021)
Holding: The Colorado Supreme Court held that a court may recognize a common law marriage entered into in Colorado before the state recognized same-sex couples' fundamental right to marry for two reasons. First, Obergefell struck down state laws that excluded same-sex couples as unconstitutional. The general rule is that a statute that is declared unconstitutional is void ab initio; it is inoperative as if it had never been enacted. "Consequently, state law restrictions [i.e., Colo. Const. art. II, sec. 31, and section 14-2-104 (1)(b) and (2), C.R.S.] held unconstitutional in Obergefell cannot serve as an impediment to the recognition of a same-sex marriage predating that decision." Recognition of the same-sex marriage is the remedy for a state's earlier violation of the couple's constitutional right. The relationship must still satisfy the revised test for establishing a common law marriage as announced in Hogsett.
Second, Obergefell applies retroactively to marriages, including common law marriages predating the decision. Because the Obergefell court applied its rule of federal law to the litigants before it, the Colorado Supreme Court concluded that the holding that declared restrictions on same-sex marriages unconstitutional must be given retroactive effect.
Adopting the reasoning from cases that struck down laws that criminalized interracial marriage, the supreme court rejected LaFleur's contention that, as a matter of law, it was impossible for a same-sex couple to form the requisite intent to enter into common law marriage before Colorado recognized same-sex couples' right to marry. Establishing the intent to enter into a marital relationship was sufficient, even though the relationship was not yet recognized. Applying the refined test for common law marriage under Hogsett, the supreme court affirmed the district court's ruling of common law marriage and remanded the case for determination of property division and assets in accordance with Colorado's dissolution statutes. Of Note: The supreme court's opinion includes a history of laws and court cases relating to common law marriage and same-sex marriage.
Case Summary: In In re Marriage of LaFleur & Pyfer, Pyfer filed for dissolution of marriage, alleging that he had entered into a common law marriage with his same-sex partner LaFleur. In 2003, the parties held a ceremony before friends and family and exchanged vows and rings. LaFleur asserted that a common law marriage claim was legally impossible because at the time of the 2003 ceremony, Colorado did not recognize same-sex marriages, and, knowing it was not legal, he never mutually consented to a marriage that would be legally binding with respect to his assets. (For more information, contact Brita Darling.)
In re Estate of Yudkin, Colorado Supreme Court No. 19SC234 (January 11, 2021)
Holding: Finding that the district court magistrate's record was not clear as to whether Yudkin and Dareuskaya mutually agreed to be married, the Colorado Supreme Court directed the district court to apply the revised test for proving common law marriage under Hogsett. The supreme court directed the district court to look for evidence of the couple's express intent to marry. In the absence of such intent, mutual intent may be inferred from conduct that is judged in context. Contrary to the court of appeal's assertion that essentially presumed common law marriage from cohabitation and holding out as married, the supreme court cautioned, "No single factor is dispositive." Further, the supreme court clarified that the factors are flexible and that the district court's examination of the couple's conduct "is not to test the couple's agreement to marry against an outdated marital ideal, but to discover their intent."
Case Summary: In In re Estate of Yudkin, Dareuskaya claimed the right to serve as executor of Yudkin, her alleged different-sex common law spouse, after his intestate death. While Yudkin and Dareuskaya cohabitated and held themselves out in the community as married, they did not file joint tax returns or own joint property and did not share a last name. The district court magistrate concluded that Dareuskaya had not proven a common law marriage, finding it extremely relevant that Yudkin and Dareuskaya filed separate state and federal tax returns. The court of appeals concluded that the magistrate erred because the parties agreed to be married and met two of the Lucero factors most likely to show intent to be married: cohabitation and holding themselves out as married. (For more information, contact Brita Darling.)
---------------
Elder v. Williams, Colorado Supreme Court No. 19SC1009 (December 21, 2020)
Holding: Claims for compensatory relief and equitable remedies under the Colorado Anti-Discrimination Act (CADA) do not and could not lie in tort for purposes of the Colorado Governmental Immunity Act (CGIA) and therefore are not barred by the CGIA. In addition, the provision in section 24-34-405 (8)(g), C.R.S., exempting certain CADA claims for compensatory damages against "the state" from the CGIA applies whether the claims are made against the state itself, a state agency, or a political subdivision of the state.
Case Summary: A former employee of the El Paso County Sheriff's Office (EPSO) filed CADA claims against EPSO for age discrimination and retaliation. The plaintiff sought front pay and compensatory damages for both claims. EPSO filed a motion to dismiss the claims on the grounds that compensatory damages and front pay are legal remedies that lie or could lie in tort and are barred by the CGIA. The district court denied the motion to dismiss, concluding that the claims are not barred by the CGIA.
On appeal, a division of the Colorado Court of Appeals acknowledged that another division of the court of appeals had, in Houchin v. Denver Health, 2019 COA 50M, held that the CGIA bars CADA claims for compensatory damages asserted against political subdivisions of the state because: (1) compensatory damages are not an equitable remedy and (2) Section 24-34-405 (8)(g), C.R.S., exempts a CADA claim for compensatory damages from the CGIA only when the claim is made against "the state", meaning the state of Colorado or an agency of the state of Colorado, and not when the claim is made against a political subdivision of the state. However, the court of appeals in this case disagreed with the Houchin court, holding that the CGIA does not bar the plaintiff from seeking compensatory damages for retaliation because: (1) the compensatory damages allowed under the CADA do not relieve tort-like personal injuries, are merely incidental to the CADA's primary purpose of ending discrimination, and therefore do not lie in tort and are not subject to the CGIA and (2) the word "state", as used in section 24-34-405 (8)(g), C.R.S., refers to all state entities able to seek immunity under the CGIA, including political subdivisions of the state. The decision created a conflict in the court of appeals as to whether a CADA claim for compensatory damages that is made against a political subdivision of the state is barred by the CGIA.
The Colorado Supreme Court affirmed the holding of the division of the court of appeals in this case, resolving the conflict. The court held that claims for compensatory relief under CADA do not and could not lie in tort and are not barred by the CGIA because such claims derive from statutory duties and are designed to implement the policy of eliminating intentional discrimination and not to compensate for individual personal injuries. The court also affirmed that the phrase "the state" as used in section 24-34-405 (8)(g), C.R.S., includes both the state of Colorado and any state agency or political subdivision. The court also affirmed that claims for front pay under CADA are equitable in nature and are not barred by the CGIA. (For more information, contact Megan Waples.)
People v. Lee, Colorado Supreme Court No. 19SC749 (November 23, 2020)
Holding: A defendant may not be charged with second degree assault based on conduct involving strangulation under both the deadly weapon subsection of the second degree assault statute, section 18-3-203 (1)(b), and the strangulation subsection of that statute, section 18-3-203 (1)(i). Rather, the defendant must be charged under the strangulation subsection.
Case Summary: Following an alleged assault, the defendant was charged with two counts of second degree assault under the strangulation subsection, section 18-3-203 (1)(i). Eight months later, the People added two additional counts of second degree assault under the deadly weapon subsection, section 18-3-203 (1)(b), asserting that the defendant had used his hands as a deadly weapon. Second degree assault by strangulation is also a class 4 felony and an extraordinary risk crime, with a potential prison sentence of 2 to 8 years. Second degree assault with a deadly weapon is a class 4 felony, but because it is a per se crime of violence, it carries a longer potential prison sentence of 5 to 16 years.
The trial court granted the defendant's motion to dismiss the added counts under the deadly weapon subsection. The court of appeals affirmed the dismissal because charging the same conduct under both subsections, which carry different maximum penalties, would violate a defendant’s right to equal protection.
The Colorado Supreme Court affirmed, holding that a defendant can only be charged for conduct involving strangulation under the strangulation subsection. The court first examined the state's equal protection jurisprudence, citing prior decisions holding that the due process clause of the Colorado Constitution, Colo. Const. art. II, § 25, guarantees equal protection under the law. A defendant's guarantee of equal protection under the Colorado Constitution is violated when two criminal statutes proscribe identical conduct, but one statute punishes that conduct more harshly. The court recognized that Colorado's approach when two criminal statutes proscribe identical conduct with different penalties is different than federal equal protection standards, and the court declined to adopt the federal approach.
Turning to the statute at issue, the court found that the second degree assault-deadly weapon and second degree assault-strangulation subsections proscribe identical conduct because strangulation will always involve the use of a deadly weapon, the perpetrator's hands. Because these provisions proscribe identical conduct but the deadly weapon subsection punishes that conduct more harshly than the strangulation subsection, the court held that, under Colorado equal protection principles, a defendant may not be charged with second degree assault based on conduct involving strangulation under both subsections. Rather, the defendant must be charged under the strangulation provision.
The court based its ruling on the plain language of the statute, but also noted that the legislative history supported the court's holding because it showed the bill sponsor's intent that all strangulations would be prosecuted under the specific strangulation provision. (For more information, contact Conrad Imel.)
Linnebur v. People, Colorado Supreme Court No. 18SC884 (November 9, 2020)
Holding: Prior felony convictions are an element of felony DUI that must be proved to the jury beyond a reasonable doubt, rather than a sentence enhancer that a judge may find by a preponderance of the evidence.
Case Summary: The defendant was charged with driving under the influence of alcohol (DUI) and also charged with felony DUI based on prior convictions. A person commits felony DUI if the offense occurred after three or more prior convictions for DUI, DUI per se, or DWAI. The defendant filed a motion arguing that the fact of his prior convictions was a substantive element of felony DUI, so the prior convictions had to be proved to a jury beyond a reasonable doubt. The trial court denied the motion, concluding instead that the prior convictions were merely sentence enhancers, so they could be proved to the court by a preponderance of the evidence. The appeals court affirmed the decision.
The question of whether the prior convictions are an element of the offense or merely a sentence enhancer has caused a split among the divisions of the court of appeals. So the Colorado Supreme Court granted certiorari to resolve the question. The Colorado Supreme Court ruled that the prior offenses are an element of felony DUI. The statutory provisions that define and provide penalties for felony DUI make prior convictions an element of the crime, which must be proved to the jury beyond a reasonable doubt. (For more information, contact Jery Payne.)
TABOR Found. v. Colo. Dept. of Health Care Policy and Fin., Colorado Court of Appeals No. 19CA0621 (November 5, 2020)
Holding: Plaintiffs, the TABOR Foundation, the Colorado Union of Taxpayers Foundation, and two individual members of the foundations lacked standing to challenge the constitutionality of the repealed hospital provider fee program and the existing healthcare affordability and sustainability fee program.
Case Summary: Plaintiffs, the TABOR Foundation, the Colorado Union of Taxpayers Foundation, and two individual members of the foundations, sued the Department of Healthcare Policy and Financing and other state entities in Denver District Court in 2015, alleging that the hospital provider fee program (HPF program) violated the Taxpayer's Bill of Rights (TABOR). Plaintiffs claimed that the mandatory hospital provider "fee" (HPF) that the state charged to hospitals and collected as revenue subject to the state fiscal year spending limit was actually a tax imposed without the voter approval in advance required by TABOR.
In 2017, the General Assembly enacted Senate Bill 17-267 "Concerning the Sustainability of Rural Colorado" (SB 267) which, among other things, repealed the HPF program and created a new healthcare affordability and sustainability fee program (HASF program). Under the HASF program, the Colorado healthcare affordability and sustainability enterprise (CHASE) imposes and collects a healthcare affordability and sustainability fee (HASF) that is substantially similar to the HPF but generates TABOR-exempt revenue that does not count against the state fiscal year spending limit. In response to the enactment of SB 267, plaintiffs amended their complaint to include claims that: (1) the CHASE cannot qualify as an enterprise exempt from TABOR because the HASF is actually a tax imposed without voter approval in advance; (2) that HASF revenue thus is not TABOR-exempt, and the state collected revenue in excess of the state fiscal year spending limit without making required TABOR refunds; and (3) that SB 267 contained multiple subjects in violation of the constitutional requirement that all bills contain a single subject.
In March 2019, after considering summary judgment motions filed by both sides, the Denver District Court rejected Defendants' argument that Plaintiffs lacked standing to bring the lawsuit but granted Defendants' motion for summary judgment on the merits and dismissed the case. Plaintiffs appealed.
In November 2020, the Colorado Court of Appeals held that Plaintiffs lacked standing to challenge the constitutionality of the HPF program and the HASF program. The court of appeals found that: (1) the individual Plaintiffs lacked taxpayer standing both generally and under the provision of TABOR that authorizes citizen enforcement lawsuits because hospitals, not taxpayers, paid the HPF and pay the HASF, and there was therefore no clear nexus between their taxpayer status and the fees; (2) the individual Plaintiffs lacked individual standing because the HPF and HASF programs affected healthcare consumers only indirectly, and they therefore suffered no direct and individualized injury; and (3) The foundation Plaintiffs lacked associational standing because the members did not otherwise have standing to sue in their own right. Accordingly, the court of appeals reversed the judgment of the district court that Plaintiffs had standing, vacated the portions of the district court’s opinion that addressed the merits of the lawsuit, and affirmed the grant of summary judgment for Defendants.
Plaintiffs have filed a petition for a writ of certiorari to the Colorado Supreme Court, Defendants have opposed the petition, and the supreme court is considering whether or not to accept the petition. (For more information, contact Jason Gelender.)
People v. Black, Colorado Court of Appeals No. 17CA0317 (September 17, 2020)
Holding: When faced with a jury question that indicates the possibility of an impasse, a trial court cannot tell the jury to continue deliberating without conducting a threshold inquiry to determine the likelihood of progress towards a unanimous verdict if deliberations continue.
Case Summary: The defendant was of convicted third degree assault, driving under the influence, and two counts of resisting arrest. During deliberations, the jury asked the trial court, "What happens if we can’t come to a unanimous decision on only one charge?" Without further inquiry into whether the jury had reached an impasse and how intractable that impasse was, the trial court instructed the jury to continue deliberating.
The court of appeals recognized that a trial court violates a defendant's constitutional rights to due process, an impartial jury, and a unanimous verdict when the trial court gives a coercive instruction to the jury. When a jury raises the possibility of an impasse during deliberations, a court's instruction to continue deliberating risks coercing jurors to abandon their conscientious convictions about the case for the sake of reaching a unanimous verdict.
Whether an instruction is coercive depends on the content of the instruction and the context in which it is given. A trial court can mitigate the coercive risk of a deliberation instruction by giving a modified instruction instead of an unqualified instruction to continue deliberating. In order to determine whether a modified instruction is necessary, the trial court must determine the jury's likelihood of progress toward a unanimous verdict. If progress is likely, there is no impasse and the trial court can give the jury an unqualified instruction to continue deliberating. If the trial court determines that progress is unlikely, the court may, in its discretion, give a modified instruction to continue deliberations.
In this case, the court of appeals found that the trial court did not make the threshold inquiry into the likelihood of a unanimous verdict, and that the failure to do so was reversible error because instructing the jury to continue deliberating without any understanding of the intractability of the impasse risks coercing the jurors to reach a compromise verdict.
The court of appeals acknowledged that another division of the court of appeals, in People v. Munsey, 232 P.3d 113 (Colo. App. 2009), found no coercion and no error under similar circumstances. The court of the appeals in this case disagreed with the Munsey division because it found the Munsey division's holding contrary to state Supreme Court decisions and because the Munsey division seemed to have characterized the trial court's duty to determine to what extent the jury is deadlocked as a rebuttable presumption. Thus, the court declined to follow the Munsey division's decision, and instead held that when a jury question suggests an impasse, the trial court must conduct a threshold inquiry to determine the likelihood of progress towards a unanimous verdict if deliberations continue prior to instructing the jury. (For more information, contact Conrad Imel.)
Thompson v. People, Colorado Supreme Court No. 18SC543 (September 14, 2020)
Holding: The determination of whether a promissory note is a security is based on an analysis that presumes that the promissory note is a security unless it is within one of seven categories of notes that are excluded from being a security or bears a strong family resemblance to one of the excluded categories, following Reves v. Ernst & Young, 494 U.S. 56 (1990) and overruling People v. Milne, 690 P.2d 829 (Colo. 1984) (which based the analysis on whether the note is an investment contract).
Case Summary: The defendant induced third parties to loan him $2.4 million, telling them that the loan would be used as a bridge loan for his real estate development company and that it would be a very low-risk, short-term investment with a $240,000 profit and 8% annual interest. The defendant executed a promissory note to the third parties that was secured by the defendant's real estate. The defendant did not disclose that the real estate, which had been valued at far less than what the defendant had represented, was already heavily leveraged and that his real estate company had already declared bankruptcy. After a bank foreclosed on the real estate and the defendant defaulted on the promissory note, the defendant was charged with and convicted of securities fraud; the court of appeals affirmed.
The definition of a security includes "any note" and an "investment contract". Under People v. Milne, 690 P.2d 829 (Colo. 1984), the determination of whether a promissory note is a security was based on an analysis of whether the note is an investment contract. In contrast, the United States Supreme Court held in Reves v. Ernst & Young, 494 U.S. 56 (1990), that the determination of whether a promissory note is a security is based on an analysis that presumes that the promissory note is a security unless it is within one of seven categories of notes that are excluded from being a security or bears a strong family resemblance to one of the excluded categories. The Colorado Supreme Court noted that the securities act specifies that its provisions are to be coordinated with the federal act, that the two acts' definitions of a security are analogous, and that the trend among other states is to adopt the family resemblance analysis established by Reves.
After adopting the family resemblance test and thereby overruling Milne, the court held that the promissory note neither was within one of the seven categories of excluded promissory notes nor bore a strong family resemblance to any of the categories. It was therefore a security, and the court affirmed the defendant's conviction. (For more information, contact Thomas Morris.)
People v. Johnson, Colorado Court of Appeals No. 17CA0822 (August 20, 2020)
Holding: The common law doctrine of abatement ab initio extinguishes a restitution order entered as part of a criminal sentence when the defendant dies while his criminal conviction is pending on direct appeal.
Case Summary: The defendant was convicted of multiple counts of securities fraud and theft and adjudicated a habitual criminal. The district court sentenced him to a total of forty-eight years in prison and ordered him to pay costs, fees, and restitution. The defendant appealed, but the defendant died before the appeal could be resolved.
Under the common law doctrine of abatement ab initio, when a defendant dies while his or her criminal conviction is pending on direct appeal, the defendant's death "abates not only the appeal but also all proceedings had in the prosecution from its inception [. . .] leaving the defendant as if he or she had never been indicted or convicted." The court of appeals acknowledged that another division of the court of appeals, in People v. Daly, 313 P.3d 571 (Colo. App. 2011), had held that when a criminal defendant dies during the pendency of the appeal, a restitution order should not be abated because it is a civil judgment that survives the defendant's death. The Daly division relied on section 18-1.3-603 (4)(a)(I), C.R.S., which states that a restitution order is "a final civil judgment in favor of the state and any victim" that, "[n]otwithstanding any other civil or criminal statute or rule, [. . .] remains in force until the restitution is paid in full." The Daly division found that legislature intended the statute to create a civil judgment that survives a defendant’s death and to which the doctrine of abatement ab initio does not apply.
The court of appeals in this case disagreed with the Daly division because subsequent legal authority from the U.S. Supreme Court, the Colorado Supreme Court, and other jurisdictions convinced the court that when a defendant dies during the pendency of his direct appeal, the doctrine of abatement ab initio operates to extinguish not only the defendant's conviction but everything associated with the case, including any restitution order. The U.S. Supreme Court, in Nelson v. Colorado, 137 S. Ct. 1249 (2017), held that, when a criminal conviction is invalidated by a reviewing court and no retrial will occur, the State is obliged to refund restitution exacted from the defendant as a consequence of the conviction. In People v. Cowen, 2018 CO 96, the Colorado Supreme Court "extended the teachings" of the U.S. Supreme Court's decision in Nelson, and held that procedural due process prohibits ordering restitution "for losses resulting from conduct of which a defendant has been acquitted and as to which he retains the presumption of innocence." The court of appeals also found that the majority of federal circuit courts have held that the doctrine of abatement ab initio applies to restitution orders. Based on this authority, the court of appeals concluded that restitution orders are subject to abatement ab initio because when the doctrine is applied, the defendant's conviction is erased and the presumption of innocence restored.
Although the General Assembly may modify or abrogate common law, such as the doctrine of abatement ab initio, the court of appeals held that section 18-1.3-603, C.R.S., relied on by the Daly division, does not clearly modify the doctrine of abatement ab initio to exclude restitution orders because (1) the statute expressly ties the restitution order to a conviction, but the defendant's death during the pendency of an appeal abates the conviction; (2) while the statute applies "[n]otwithstanding any other civil or criminal statute or rule", the common law doctrine of abatement ab initio is neither a statute nor a rule; and (3) even though the statute addresses what happens when a defendant dies before paying restitution in full, generally, it does not address the specific situation in which a defendant dies during the pendency of a direct appeal.
The court of appeals recognized that its decision may lead to unjust results for crime victims, but that the General Assembly or Colorado Supreme Court could avoid those outcomes by abolishing or abrogating the doctrine of abatement ab initio. (For more information, contact Conrad Imel.)