Vallagio at Inverness Residential Condominium Association, Inc. Petitioner
Metropolitan Homes, Inc., a Colorado corporation; Metro Inverness, LLC, a Colorado limited liability company; Greg Krause, individually; and Peter Kudla, individually. Respondents
to the Colorado Court of Appeals Court of Appeals Case No.
Attorneys for Petitioner: Burg Simpson Eldredge Hersh Jardine
P.C. Ronald M. Sandgrund Scott F. Sullan Mari K. Perczak
Leslie A. Tuft Brian Matise Nelson Boyle Englewood, Colorado
Attorneys for Respondents: Palumbo Lawyers LLP Marisa C. Ala
Mary Ritchie Greenwood Village, Colorado
Attorneys for Amicus Curiae Build Our Homes Right: Orten
Cavanagh & Holmes, LLC Candyce D. Cavanagh Denver,
Attorneys for Amici Curiae City and County of Denver,
Colorado; Board of County Commissioners for Douglas County,
Colorado; City of Aurora, Colorado; City of Northglenn,
Colorado; Denver Metro Chamber of Commerce; Metro Denver
Economic Development Corporation; Downtown Denver
Partnership; Colorado BUILDS; Associated General Contractors
of Colorado; Colorado Contractors Association, Inc.; Housing
Colorado; Colorado Competitive Council; Colorado Mortgage
Lenders Association; Colorado Bankers Association; Colorado
Business Roundtable; NAIOP Colorado Chapter; Associated
Landscape Contractors of Colorado; Colorado Association of
Mechanical & Plumbing Contractors; Mechanical Contractors
Association of Colorado; Mechanical Service Contractors
Association of Colorado; National Certified Pipe Welding
Bureau, Colorado Chapter; Colorado Association of
Plumbing-Heating-Cooling Contractors; American Council of
Engineering Companies of Colorado; American Subcontractors
Association of Colorado; Rocky Mountain Chapter, National
Electrical Contracting Association; Independent Electrical
Contractors Rocky Mountain; D.R. Horton; Hyder Construction,
Inc.; Palisade Partners, LLC; and Front Range Land and
Development Co.: Polsinelli PC Richard M. Murray Amy K.
Hansen Ryan E. Warren Denver, Colorado
Attorneys for Amicus Curiae Community Associations Institute:
Benson, Kerrane, Storz & Nelson, P.C. Jeffrey P. Kerrane
Attorneys for Amici Curiae National Association of Home
Builders; Colorado Association of Home Builders; Home
Builders Association of Metro Denver; Summit County Builders
Association; Housing & Building Association of
Northwestern Colorado; Home Builders Association of Northern
Colorado d/b/a NOCO HBA; Housing & Building Association
of Colorado Springs and Pikes Peak Region; Pueblo Association
of Home Builders, Inc.; Grand County Builders Association;
and NAIOP Colorado, the Commercial Real Estate Development
Association: Bryan Cave LLP Stephen D. Gurr Denver, Colorado
¶1 This case principally requires us to determine
whether the Colorado Common Interest Ownership Act
("CCIOA"), §§ 38-33.3-101 to -402, C.R.S.
(2016), permits a developer-declarant to retain a right of
consent to certain proposed amendments to a common interest
community's declaration. The petitioner, Vallagio at
Inverness Residential Condominium Association, Inc. (the
"Association"), seeks to recover damages for
alleged construction defects in the Vallagio at Inverness
residential development project (the "Project"), a
common interest community organized under CCIOA. The
Project's developer and declarant, respondent Metro
Inverness, LLC (the "Declarant"), drafted and
recorded the Project's original declaration, which set
forth specific dispute resolution procedures for construction
defect claims. Specifically, and as pertinent here, certain
provisions of the original declaration (1) required that all
construction defect claims be resolved through binding
arbitration and (2) provided that the provisions governing
such claims "shall not ever be amended" without the
Declarant's written consent.
Shortly before the Association filed the present action, and
without obtaining the Declarant's consent, the requisite
number of the Project's unit owners voted to amend the
declaration to delete the foregoing dispute resolution
provisions. The Association then proceeded to file a
complaint in district court, naming as defendants the
Declarant and three related parties, respondents Metropolitan
Homes, Inc., Greg Krause, and Peter Kudla. The Declarant
moved to compel arbitration, arguing that the attempted
declaration amendment was ineffective absent its written
consent and, thus, the Association was bound by the
arbitration provision contained in the original declaration.
The district court denied the Declarant's motion,
reasoning in pertinent part that the consent-to-amend
provision violated and was therefore void under CCIOA. The
Declarant brought an interlocutory appeal in the court of
appeals, and a division of that court reversed the district
court's denial of the motion to compel arbitration.
Vallagio at Inverness Residential Condo. Ass'n v.
Metro. Homes, Inc., 2015 COA 65, ¶¶ 1, 72,
We granted certiorari and now affirm. We conclude that the
consent-to-amend provision contained in the Project's
original declaration is consistent with CCIOA and is
therefore valid and enforceable. We further conclude that
because the unit owners did not obtain the Declarant's
consent to remove the arbitration provision, the attempted
removal was ineffective, and the declaration's
arbitration agreement remains in force. Finally, we conclude
that nothing in the Colorado Consumer Protection Act
("CCPA"), §§ 6-1-101 to -1121, C.R.S.
(2016), precludes arbitration of the Association's CCPA
Facts and Procedural History
The Declarant drafted, and in 2007 recorded, the
Project's original declaration.
Section 13.1 of the declaration established the general
procedures for amending the declaration. As pertinent here,
it allowed the unit owners to amend the declaration but
required a vote or agreement of unit owners holding at least
67% of the votes in the Association to do so. In addition,
until a certain point in time, the Declarant also had to
consent to any proposed amendment. The parties do not appear
to dispute that the Declarant's right of consent under
Section 13.1 expired in 2012.
Section 16.6 of the declaration, in turn, established
comprehensive dispute resolution procedures for construction
defect claims, including a requirement that all such claims
be submitted to binding arbitration (the "arbitration
provision"). Additionally, Section 16.6(h) (the
"consent-to-amend provision") provided in pertinent
The terms and provisions of this Section 16.6 inure to the
benefit of Declarant, are enforceable by Declarant, and
shall not ever be amended without the written consent of
Declarant and without regard to whether Declarant owns
any portion of the Real Estate at the time of such amendment.
The Declarant turned over control of the Association's
board of directors to the Project's unit owners in 2010.
¶8 Thereafter, a construction defect dispute arose, and
in December 2012 and January 2013, pursuant to the
Construction Defect Action Reform Act ("CDARA"),
§§ 13-20-801 to -808, C.R.S. (2016), the
Association sent the Declarant a written notice and then a
supplemental notice of its purported claims. The parties
proceeded under CDARA's pre-litigation notice and offer
of settlement provision, see § 13-20-803.5,
C.R.S. (2016), but they did not reach agreement.
Then, in September 2013, at least 67% of the Project's
unit owners voted to amend the declaration to remove, among
other provisions, Section 16.6 in its entirety. The unit
owners did not seek or obtain the Declarant's consent to
In December 2013, the Association filed the present action in
district court, asserting a number of claims arising from
alleged construction defects, including claims under the
CCPA. The Association asserted these claims solely on its own
behalf, based on its obligation to maintain and repair all
common elements in the Project.
Relying on Section 16.6 of the declaration, the Declarant
moved to compel arbitration, arguing that the arbitration
clause in the declaration divested the district court of
jurisdiction. Specifically, the Declarant contended that
because the unit owners had not obtained its consent to amend
the declaration as required by Section 16.6(h), the parties
remained bound by Section 16.6's dispute resolution
procedures, including mandatory arbitration.
The Association responded that (1) the declaration was
validly amended because Section 16.6(h)'s
consent-to-amend requirement violated-and was therefore void
under-CCIOA and (2) even if the Association remained bound by
the declaration's arbitration agreement, its claims under
the CCPA were not arbitrable because the CCPA expressly
provides for a "civil action, " which the
Association interpreted to mean a court proceeding.
In a written order, the district court denied the
Declarant's motion to compel arbitration. The court
concluded that the Declarant's consent was not required
to remove the arbitration provision because, as pertinent
here, the consent-to-amend requirement in Section 16.6(h)
conflicted with several provisions of CCIOA and was therefore
void and unenforceable. In light of this determination, the
court declined to address the Association's argument that
the CCPA claims were non-arbitrable.
The Declarant then filed an interlocutory appeal pursuant to
section 13-22-228(1)(a), C.R.S. (2016). Vallagio,
¶ 11. As pertinent here, a unanimous division of the
court of appeals reversed in part, concluding that the
declaration required the Association to arbitrate its claims
against the Declarant. Id. at ¶ 12.
Specifically, the division perceived no conflict between
CCIOA and Section 16.6(h)'s consent-to-amend requirement.
Id. at ¶¶ 25-47. Accordingly, the division
concluded that the unit owners' attempt to remove Section
16.6 without obtaining the Declarant's consent was
ineffective, and, as a result, the declaration still
contained a valid and enforceable arbitration agreement.
Id. at ¶ 47. The division further concluded that the
Association's claims under the CCPA were subject to
arbitration because the right to a "civil action"
under section 6-1-113, C.R.S. (2016), is waivable.
Id. at ¶ 71.
¶15 The Association then sought, and we granted,
Standard of Review
We review questions of statutory interpretation de novo.
Pulte Home Corp. v. Countryside Cmty. Ass'n,
2016 CO 64, ¶ 24, 382 P.3d 821, 826. In doing so,
"we look to 'the entire statutory scheme to give
consistent, harmonious, and sensible effect to all parts'
and apply 'words and phrases according to their plain and
ordinary meaning.'" Id. (quoting Denver
Post Corp. v. Ritter, 255 P.3d 1083, 1089 (Colo. 2011)).
When the statutory language is clear, we apply it as written
and need not resort to other rules of statutory construction.
See id.; Denver Post, 255 P.3d at 1089.
We begin by addressing whether the consent-to-amend provision
is consistent with CCIOA. We then consider the
Association's contention that its CCPA claims are
non-arbitrable under the CCPA's express terms.