CENTENNIAL-ASPEN II LTD. v. City of Aspen

Decision Date20 May 1994
Docket NumberCiv. A. No. 92-B-2570.
Citation852 F. Supp. 1486
PartiesCENTENNIAL-ASPEN II LIMITED PARTNERSHIP, Plaintiff, v. The CITY OF ASPEN and the City Council of the City of Aspen, the County of Pitkin, Colorado and the Board of County Commissioners of the County of Pitkin, Colorado, and the Aspen/Pitkin County Housing Authority and the Board of Directors of the Aspen/Pitkin County Housing Authority, Defendants.
CourtU.S. District Court — District of Colorado

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Norman D. Haglund, Edwin S. Kahn, Kelly, Haglund, Garnsey & Kahn, Denver, CO, for plaintiff.

John P. Worcester, Edward M. Caswall, City Attorney's Office, Aspen, CO, for Aspen City Counsel.

Timothy Whitsitt, Aspen, CO, for Pitkin County.

John M. Ely, Asst. Pitkin County Atty., Aspen, CO, for Pitkin County defendants.

Thomas Fenton Smith, Austin, Peirce & Smith, Aspen, CO, for the Housing Authority.

MEMORANDUM OPINION AND ORDER

BABCOCK, District Judge.

Defendants County of Pitkin and Board of County Commissioners of Pitkin County (collectively County) move for summary judgment on plaintiff Centennial-Aspen II Limited Partnership's (Centennial) claims for breach of contract, declaratory judgment, promissory estoppel, reformation or rescission of the contract, and attorney fees. Defendant Aspen/Pitkin County Housing Authority (Housing Authority) also moves for summary judgment. By orders dated April 22, 1993 and February 11, 1994, I granted the Housing Authority's motion to dismiss all of Centennial's contract and declaratory judgment based claims against it. As a result, promissory estoppel is the only claim remaining against the Housing Authority. The motions have been briefed fully and oral argument was held May 17, 1994. For all the reasons set forth below, I will deny the summary judgment motions.

II.

Summary judgment shall be granted if the pleadings, depositions, answers to interrogatories, admissions, or affidavits show that there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). The nonmoving party has the burden of showing that there are issues of material fact to be determined. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). A party seeking summary judgment bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the pleadings, depositions, interrogatories, and admissions on file together with affidavits if any, which it believes demonstrate the absence of genuine issues for trial. Celotex, 477 U.S. at 323, 106 S.Ct. at 2552-53; Mares v. ConAgra Poultry Co., Inc., 971 F.2d 492, 494 (10th Cir.1992). Once a properly supported summary judgment motion is made, the opposing party may not rest on the allegations contained in his complaint, but must respond with specific facts showing the existence of a genuine factual issue to be tried. Otteson v. U.S., 622 F.2d 516, 519 (10th Cir.1980); Fed. R.Civ.P. 56(e). Summary judgment is appropriate when the court concludes that no reasonable juror could find for the non-moving party based on the evidence present in the motion and response. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). However, summary judgment should not enter if, viewing the evidence in a light most favorable to the nonmoving party and drawing all reasonable inferences in that party's favor, a reasonable jury could return a verdict for that party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-52, 106 S.Ct. 2505, 2510-12, 91 L.Ed.2d 202 (1986); Mares, 971 F.2d at 494.

III.

Centennial owns fee title to a 148 unit apartment complex in Aspen, Colorado, called the Centennial Apartments (the Apartments). In August 1982, the Housing Authority's predecessor and the County requested proposals from development firms to construct and take title to an "affordable housing" complex initially called Silverking Phase IV. Following submission of the proposals, the County chose Centennial's predecessor as the developer. Contract negotiations began and culminated in the execution of a Disposition and Development Agreement (Development Agreement). Centennial's predecessor and the County are the only parties to this agreement.

The Development Agreement restricts the Apartment's rental increases to those allowed under certain local governmental "Qualification Guidelines" (Guidelines). However, if the Guidelines are not timely revised or amended, the percentage change in the urban index determines the rental increase amount. Section 3.02 of the Development Agreement provides:

a) The Developer agrees to comply with the Qualification Guidelines; however, upon amendment or replacement of Resolution No. 82-39 the 1982 Qualification Guidelines or if such resolution remains in force beyond 1982, the Developer shall be able to exceed the Qualification Guidelines in the following manner:
1) In any calendar year after the calendar year in which the Certificate of Completion is issued, the Developer shall be able to rent and sell Rental and Sale Units, respectively, so that the rent or sale price may be increased beyond the price ceilings in the Qualification Guidelines for the year in which such rental or sale takes place to the extent that the Aspen Wage Index for the calendar year of such rental or sale is greater that the Aspen Wage Index for the immediately preceding year.

In addition to annual adjustments in public housing rental rates, the Guidelines address the use, occupancy, price, and development of affordable housing. Specifically, they include: priorities for development; renting and purchasing qualifications; sale procedures; minimum size and quality standards; maximum sale prices for newly constructed units; maximum rents and sale prices for newly constructed units; occupancy standards; and grievance and show cause procedures.

On November 8, 1982, the City of Aspen (City), the Housing Authority of Aspen, the Board of County Commissioners of Pitkin County, and the Board of Commissioners of the Pitkin County Housing Authority executed an intergovernmental agreement (1982 IGA) to establish and jointly operate the Housing Authority. Pursuant to the 1982 IGA, the Housing Authority is authorized, among other things:

1. To plan for ... a project to provide low, moderate, middle income housing on Phase IV Silverking land to replace Silverking units that will be condominiumized for the free market.
2. To annually adopt qualifications for ownership and rental sic low, moderate and middle income housing within the City and County as required by existing agreements and land use regulations.

See 1982 IGA, p. 2, ¶¶ 6 and 7. The project on the Silverking land is the Centennial project. The Centennial project is the only housing project referenced expressly in the 1982 IGA. Subsequently, two additional IGAs were executed, one in 1984 (1984 IGA), and one in 1989 (1989 IGA). These IGAs changed the Housing Authority's responsibility regarding the Guidelines. Under the 1982 IGA, the Housing Authority adopted the Guidelines, but under the later versions, it recommends Guidelines. The 1984 and 1989 IGAs provide in article 1.7 that the Housing Authority has:

To annually recommend to the City and the County for approval, development of, and qualifications for, ownership and rental of low, moderate and middle income housing within the City and the County ... as required by existing agreements and land use regulations.

Notwithstanding this substantive change in the IGAs, the Housing Authority has never, since its inception in 1982, issued annual Guidelines without the County's and City's approval.

In 1984, before the Apartments were constructed, the County passed Resolution No. 84-32 (Rent Resolution) which altered the Development Agreement's mechanism for setting rental rates during the period at issue here. In relevant part, it provides:

Beginning on January 1, 1990, and in each subsequent year, the monthly rental for each rental unit in the Project, whether designated low income or moderate-income, and whether occupied as of such date or not, may be increased over the gross monthly rental permitted in the prior year by the percentage increase in rent for existing rental units as contained in the Qualification Guidelines most recently published prior to January 1 of the year in which the rentals are to be increased, or if the Qualification Guidelines have not been revised or amended in the twelve month period immediately preceding January 1 of the year in which the rentals are to be increased, the percentage change in the Urban Index during the twelve months ending on November 30 of the year immediately proceeding the year in which the rentals are to be increased.
* * * * * *
The terms of this Resolution shall supersede any prior agreements or arrangements concerning rental rates in the Project.

Subsequently, the Development Agreement was amended three times. The first amendment left § 3.02(a)(1) of the Development Agreement intact; however, the second amendment deleted § 3.02(a)(1). In addition, § 2.01(c)(4) references the Rent Resolution as controlling over the Guidelines. See Third Amended Complaint, ¶ 36. The third amendment did not amend the Rent Resolution. Instead, consistent with the second amendment, it reaffirmed that Centennial's covenant to comply with the Guidelines meant the Guidelines as amended by the Rent Resolution. Id. at ¶ 39.

The 1984 Rent Resolution deferred the Guidelines' use as a rent-setting mechanism for five years. No dispute arose concerning the Guidelines' application until 1991. The Development Agreement is silent as to the specific method for establishing the Guidelines beginning January 1, 1990. At issue here is whether the Apartment's rental rate increases under the Guidelines and the amended Development Agreement must be based upon an...

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    • United States
    • U.S. Bankruptcy Court — District of Colorado
    • September 2, 2021
    ...prior course of dealings may also be considered in determining whether a contract is ambiguous." Centennial-Aspen II Ltd. P'ship v. City of Aspen , 852 F. Supp. 1486, 1492 (D. Colo. 1994).The SLC invites the Court to consider SLC Additional Fact Nos. 2-8 as extrinsic evidence establishing a......
  • Alvariza v. Home Depot, Civil Action No. 05-cv-02590-EWN-BNB.
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    ...promise must be enforced to prevent Berg v. State Bd. of Agric., 919 P.2d 254, 259 (Colo.1996) (citing Centennial-Aspen II Ltd. P'ship v. City of Aspen, 852 F.Supp. 1486 [D.Colo.1994]). Plaintiff comes forward with absolutely no evidence that a promise of "fair treatment" was made, let alon......
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    • Colorado Supreme Court
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    ...the promise to the promisee's detriment; and (4) the promise must be enforced to prevent injustice. Centennial-Aspen II Ltd. Partnership v. City of Aspen, 852 F.Supp. 1486 (D.Colo.1994). The doctrine represents a modest extension of the basic contract principle that one who makes promises m......
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    • United States
    • Colorado Bar Association Colorado Lawyer No. 48-7, July 2019
    • Invalid date
    ...HousingAffordabilityGap.pdf. [2] Id. [3] See Centennial-Aspen II Ltd. P'ship v. City of Aspen, 852 F.Supp. 1486, 1490 (D.Colo. 1994). [4] CRS § 38-12-301(1). [5] CRS § 38-33.3-106.5(l)(h)(l). [6] For more examples, see Colorado Department of Local Affairs (DOLA), Affordable Housing Guide fo......
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    • Colorado Bar Association Colorado Civil Claims: Elements; Defenses and Sample Pleadings (CBA) Chapter 37 Promissory Estoppel
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    • Colorado Bar Association Colorado Lawyer No. 29-11, November 2000
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    ...21. McQuillin Mun. Corp., supra, note 1 at "Contracts in General," § 29-124; Centennial-Aspen II Ltd. Partnership v. City of Aspen, 852 F.Supp. 1486 (D.Colo. 22. Keeling v. City of Grand Junction, 689 P.2d 679, 680 (Colo.App. 1984); Colorado Springs Firefighters Ass’n Local 5 v. City ......

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