Garfield County District Court No. 10CV142 Honorable James B.
Boyd, Judge.
Hall
& Evans, LLC, Alan Epstein, Brian Molzahn, Denver,
Colorado, for Defendant-Appellant
Holley, Albertson & Polk, PC, Dennis B. Polk, Eric E.
Torgersen, Lakewood, Colorado, for Defendant-Appellee
OPINION
NAVARRO JUDGE.
¶1
LB Rose Ranch, LLC (Rose) appeals the district court's
contribution judgment in favor of Hansen Construction, Inc.
(Hansen), representing Rose's share of damages for which
they were jointly liable in tort. We hold that a release Rose
received from the plaintiffs as part of a settlement did not
discharge Rose's contribution liability under section
13-50.5-105(1)(b), C.R.S. 2018. Before Rose's settlement,
Hansen had fully satisfied the tortfeasors' common
liability to the plaintiffs. Because the settlement between
Rose and the plaintiffs did not resolve any common liability
shared by Rose and Hansen, the release did not discharge
Rose's contribution liability to Hansen. Therefore, we
affirm the contribution judgment.
I.
Procedural History
¶
2 A group of homeowners sued Rose, Hansen, and other
defendants for damages caused by defects in the design,
construction, and repair of twenty single-family homes in the
Ironbridge Golf Club and Mountain Community subdivision in
Glenwood Springs.[1]
¶
3 Hansen and other defendants compelled arbitration, but Rose
did not. Thus, Rose did not participate in the ensuing
arbitration. The arbitrator awarded damages to the homeowners
and found that Hansen, Rose, and other defendants jointly
caused them.
¶
4 Rose and the homeowners went to a jury trial. Hansen did
not participate in that trial. Like the arbitrator, the jury
found Rose, Hansen, and other defendants jointly and
severally liable for sizeable damages. In particular, the
jury found that Rose "consciously conspired and
deliberately pursued with [Hansen and others] a common plan
or scheme to engage in conduct that was negligent, that
involved a negligent misrepresentation or nondisclosure, or
which was a breach of [their] fiduciary duties."
¶
5 As to each homeowner's damages, the jury found Rose 30%
at fault and Hansen 15% at fault. As later interpreted by the
district court, the arbitrator attributed 20% fault to Rose
and 18% to Hansen. Both the arbitrator and the jury awarded
damages on a lot-by-lot basis, rather than a single aggregate
award.
¶
6 In October 2015, the court confirmed and entered judgment
on the arbitration awards against Hansen and others. Hansen
satisfied this judgment as to each homeowner, paying an
aggregate amount of over $9 million.
¶
7 When entering judgment on the jury verdicts against Rose,
the court found that Rose was bound only by the jury's
findings and Hansen was bound only by the arbitrator's
findings. The court also decided that the homeowners could
not receive double recovery for damages already paid by
Hansen. Therefore, the court compared the jury award for each
lot to the arbitrator's award for each lot, and the court
determined that Rose must pay each homeowner only those
damages awarded by the jury that exceeded those awarded by
the arbitrator (and already paid by Hansen).
¶
8 To accomplish this, the court entered judgment against Rose
for the entire amount of the jury award (with a small
deduction for an inconsistency) but found that the judgment
for each lot was satisfied to the extent that Hansen had
already paid the damages. For many lots, this finding
entirely extinguished Rose's duty to pay the homeowners.
In total, the court entered judgment against Rose for over
$6.6 million and ruled that most of it - all but $698, 548.93
- had been satisfied by Hansen. The homeowners' claims
against Rose for prejudgment interest, fees, and costs
remained outstanding.
¶
9 After the court entered judgment on the jury verdicts, Rose
settled with the homeowners for approximately $1 million, and
they released Rose from all claims related to the properties.
Both Rose and the homeowners waived their right to appeal the
judgment.
¶
10 Hansen then sought a contribution judgment against Rose
for the amount of common liability to the homeowners that
Hansen had satisfied. To determine the common liability of
Rose and Hansen, the court referred to its findings
supporting the judgment on the jury verdicts. The court found
that Rose and Hansen were jointly liable as to each lot for
only the damage amounts awarded both by the jury as
to Rose and by the arbitrator as to Hansen. The court found
this joint amount to be $5, 914, 566.37 and ruled that Hansen
had paid this entire amount to the homeowners when it
satisfied the arbitration judgment. The court, applying the
jury's finding as to Rose's percentage of fault, then
concluded that Rose must pay Hansen 30% of this joint
liability, or $1, 774, 369.91.
¶
11 In doing so, the court rejected Rose's assertion that
the release received from the homeowners as part of the
settlement discharged Rose from any contribution liability to
Hansen. According to the court, Rose's settlement with
the homeowners did not resolve any common liability with
Hansen. This was true because, at the time of the settlement,
only Rose was liable to pay the homeowners anything: the
$698, 548.93 owed them under the judgment on the jury
verdicts (plus interest, costs, and fees in amounts yet to be
determined). Rose appeals.
II.
Contribution Judgment
¶
12 Rose contends that the district court erred in the
contribution judgment because (1) Hansen's satisfaction
of the arbitration judgment did not extinguish Rose's
liability to the homeowners; (2) Rose's settlement with
the homeowners discharged any contribution liability to
Hansen; and (3) the court violated Rose's due process
rights by holding it responsible for the damages determined
by the arbitrator even though it was not a party ...