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Hardy v. Flood

United States District Court, D. Colorado

October 11, 2019

MERVIN J. FLOOD, and SUSAN S. FLOOD, Defendants.



         This matter is before the Court on Defendants Mervin J. Flood and Susan S. Flood's Motion in Limine (Doc. # 136). For the following reasons, the Court grants Defendants' Motion in Limine.

         I. BACKGROUND

         The Court's previous Orders (Doc. # 131; Doc. # 64), United States Magistrate Judge Michael Watanabe's Recommendation (Doc. # 62), and United States Magistrate Judge N. Reid Neureiter's Recommendation (Doc. # 107) provide detailed recitations of the factual background of this case and are incorporated herein. The Court details the procedural history and factual background of this case only to the extent necessary to address Defendants' Motion in Limine.

         This action arises from Plaintiffs' purchase of a residential property and its improvements from Defendants in June 2013, pursuant to a Contract to Buy and Sell Real Estate (the “Purchase Agreement”). (Doc. # 66.) Plaintiffs allege that Defendants were obligated to but did not disclose several latent defects[1] of which Defendants were aware before the parties executed the Purchase Agreement. (Id. at 7-8.) Plaintiffs assert that, among these alleged latent defects, was the fact that “the basement was finished without the required building permit[.]” (Doc. ## 142 at 12, 66 at ¶ 34.) They further claim that “Defendants' failure to disclose, and their affirmative misrepresentations in the sale disclosures” have caused Plaintiffs to sustain damages. (Doc. # 66 at 8.) On December 28, 2016, Plaintiffs initiated this action and asserted three claims for relief against Defendants: (1) breach of contract; (2) fraud; and (3) negligent misrepresentation. (Doc. # 3 at 4-7; Doc. # 66.) However, on May 15, 2019, Plaintiffs stipulated to the dismissal of their negligent misrepresentation claim (Doc. # 151) and the Court dismissed that claim with prejudice (Doc. # 153).

         On February 26, 2019, the Court denied summary judgment on all of Plaintiffs' claims and Defendants' statute of limitations defense. (Doc. # 131 at 12.) On April 24, 2019, Defendants filed their Motion in Limine and raised four distinct motions in limine before the Court. (Doc. # 136.) On May 10, 2019, Defendants' Fourth Motion in Limine was granted and the trial was vacated. (Doc. # 150.) The Court considers Defendants' remaining motions in limine in turn.



         In Defendants' first motion in limine, they seek a determination of law that Defendants did not have a duty to disclose the fact that Defendants failed to acquire a building permit for the basement that they finished because the building permit status is not a latent defect. (Doc. # 136 at 1-2.) Defendants first argue that, under Colorado law, failure to obtain a permit for a basement is not a latent defect because it does not involve a “physical defect” to the property. (Id. at 2 (emphasis in original).) Defendants' second contention provides that, as a matter of law, the failure to obtain a permit was not “latent” because the unpermitted status of the basement was “discoverable through reasonable inspection, ” and, in particular, available on the “Douglas County Assessor's Office Parcel Search website.” (Id. at 4-5.) As such, Defendants assert that the Court should rule, as a matter of law, that Defendants had no duty to disclose that the basement was unpermitted and that such a fact cannot support Plaintiffs' fraudulent concealment claim. (Id. at 5-6.)

         Plaintiffs respond by arguing that Defendants' first motion in limine is a rehash of their previously rejected arguments from several motions to dismiss (Doc. ## 26, 35, 78) and their Motion for Summary Judgment (Doc. # 108). (Doc. # 142 at 2-3.) Moreover, relying on nonbinding precedent, Plaintiffs contend that Defendants' first motion in limine is an improper and belated dispositive motion. (Id. at 1-2.) To the extent that the Court considers Defendants' first motion in limine, Plaintiffs reincorporate their arguments in opposition to Defendants' multiple motions to dismiss (Doc. ## 37, 87) and Motion for Summary Judgment (Doc # 119). (Id. at 3.)

         1. Whether Defendants' First Motion in Limine is Proper

         As a threshold issue, the Court rejects Plaintiffs' argument that Defendants' first motion in limine is improper.[2] (Doc. # 142 at 1-3.) “A motion in limine is a request for guidance by the court regarding an evidentiary question, which the court may provide at its discretion to aide the parties in formulating trial strategy.” Edens v. The Netherlands Ins. Co., 834 F.3d 1116, 1130 (10th Cir. 2016) (quoting Jones v. Stotts, 59 F.3d 143, 146 (10th Cir. 1995)). “The purpose of a motion in limine is to aid the trial process by enabling the Court ‘to rule in advance of trial on the relevance of certain forecasted evidence, as to issues that are definitely set for trial, without lengthy argument at, or interruption of, the trial.” Mendelsohn v. Sprint/United Mgmt. Co., 587 F.Supp.2d 1201, 1208 (D. Kan. 2008) (internal quotations omitted). “Pretrial rulings often may save time at trial, as well as save the parties time, effort and cost in preparing their cases.” Id. (citing United States v. Cline, 188 F.Supp.2d 1287, 1291 (D. Kan. 2002)).

         Plaintiffs assert that the jury should determine, as a question of fact, whether Defendants' lack of building permit was a latent defect. (Doc. # 87 at 18-19.) However, Plaintiffs cite no authority in support of their argument.[3] Whereas, Colorado precedent holds that, in a latent defect nondisclosure case, whether a duty to disclose exists is a question of law. Burman v. Richmond Homes Ltd., 821 P.2d 913, 918 (Colo.App. 1991).

         The Court disagrees with Plaintiffs' argument that this first motion in limine is simply an improper rehash of Defendant's Motion for Summary Judgment. In their Motion for Summary Judgment, Defendants argued that Plaintiffs could not prove the reasonable reliance element of their fraud claim. (Doc. # 131 at 10-12.) The Court denied the Motion for Summary Judgment because it determined that there were disputed issues of fact related to reasonable reliance and Colorado law clearly established that “[w]hether [a buyer] justifiably relied on [an] alleged misrepresentation [is] a question of fact” to be determined by the factfinder unless reasonable minds could not differ. (Id. at 11) (quoting Loveland Essential Grp., LLC v. Grommon Farms, Inc., 251 P.3d 1109, 1116-17 (Colo.App. 2010)).) The instant motion in ...

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