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Reishus v. Bullmasters, LLC

Court of Appeals of Colorado, Fourth Division

May 19, 2016

Allan D. Reishus, Craig T. Eckroth, and Ronald J. Danner, individually and as managers for Adams Ranch, Plaintiffs-Appellees,
v.
Bullmasters, LLC; Enrique M. Garcia, Jr., Gerardo Garcia, Gabriel A. Saenz, Adan Saenz, and Bobby W. Woodall, individually and as members of Bullmasters, LLC; Bugle Basin Ranches, LLC; Kent Gordon, individually and as a member of Bugle Basin Ranches, LLC; and Brent Biggs, individually, Defendants-Appellants.

         Rio Blanco County District Court No. 13CV30003 Honorable Daniel B. Petre, Judge

          Gast Johnson & Muffly, PC, Peter J. Dauster, Benjamin D. Kramer, Fort Collins, Colorado, for Plaintiffs-Appellees

          Porterfield & Associates, LLC, Wendell B. Porterfield, Jr., Vail, Colorado, for Defendants-Appellants

          Hawthorne and Román, JJ., concur

          OPINION

          LICHTENSTEIN JUDGE

         ¶ 1 This case involves the intersection between the common law rights held by tenants in common to possess, use, and enjoy their property, and contract provisions that purport to forego some of those property rights.

         ¶ 2 In this declaratory judgment action, defendants appeal the district court's judgment that an amendment to an ownership agreement was valid and binding on all tenants in common who hold ownership interests in a ranch. The amendment was adopted by the vote of fewer than all the tenants in common and placed restrictions on all the co-owners' access to their ranch during hunting season. Because we conclude that this amendment was validly adopted under the ownership agreement and binds all the parties to the agreement and their successors in interest, we affirm.

         I. Background

         A. The Property and Parties to This Action

         ¶ 3 Adams Ranch is a 560-acre property in Rio Blanco County, Colorado, and its owners hold the property as tenants in common.

         ¶ 4 Not all of the co-owners of the ranch are involved in this declaratory judgment action. Plaintiffs are Allan D. Reishus, Craig T. Eckroth, and Ronald J. Danner, who are the appointed managers of the ranch. Each has an undivided 1/12th interest in the ranch. They brought this declaratory judgment action after defendants objected to the hunting restriction amendment.

         ¶ 5 Defendants are two limited liability companies and seven individuals who own undivided interests in the ranch either individually or as members of the LLCs.[1] Combined, they own 4/12ths of the ownership interests in the ranch.

         ¶ 6 The remaining co-owners, while not parties to this action, agreed to be bound by the court's decision.

         B. The Stipulated Facts

         ¶ 7 The parties filed a stipulated and agreed statement of facts with attached exhibits, including an original 1988 ownership agreement, a 2007 amended and restated ownership agreement, and two amendments that were adopted in 2011. According to their stipulations and exhibits, the facts are as follows.

         ¶ 8 In 1983, the owner of Adams Ranch conveyed it to eleven individuals as tenants in common. Of those eleven co-owners, only plaintiffs Reishus and Danner still have ownership interests in the ranch.

         ¶ 9 The original ownership agreement, signed by the then-owners, was recorded in 1988. Its stated purpose was to allow each of the co-owners to build mountain homes on 35-acre parcels on the property. Among its provisions, it stated that it could be "amended or deleted by a simple majority of the individual owners at any time."

         ¶ 10 In 2007, more than a majority of the then co-owners signed an "Amended and Restated Adams Ranch Ownership Agreement" (2007 Amended Agreement).

         ¶ 11 The 2007 Amended Agreement provides that it "supersedes and replaces" the original ownership agreement. It expressly states that its provisions run with the land and are binding on all owners, their legal representatives, heirs, successors, and assigns. And it can be amended (by modifying or deleting existing provisions, or by adding new provisions) "at any time by a written and recorded instrument signed by the then-record Owners of at least 7/12ths of the Ownership Interests."

         ¶ 12 It states that the purpose of the ranch is to be an agricultural property that also provides a "quality hunting experience." Among its several provisions, it required that all guests to the ranch be accompanied by a co-owner, unless 7/12ths of the ownership interests approved an exception. It also required that the number of guests be limited to a "reasonable number" so as not to interfere with the use of the ranch by the other owners.

         ¶ 13 In 2011, an ownership meeting was held to discuss (as pertinent here) "limiting hunting days per fraction of ownership." Defendants sent an e-mail prior to the meeting stating they were not attending the meeting ...


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