Rush Creek Solutions, Inc. v. UTE MOUNTAIN TRIBE, No. 03CA0517.

• Decision Date: 12 August 2004
• Docket Number: No. 03CA0517.
• Parties: RUSH CREEK SOLUTIONS, INC., Plaintiff-Appellee, v. UTE MOUNTAIN UTE TRIBE, Defendant-Appellant.
• Court: Colorado Court of Appeals

107 P.3d 402

RUSH CREEK SOLUTIONS, INC., Plaintiff-Appellee, v. UTE MOUNTAIN UTE TRIBE, Defendant-Appellant.

No. 03CA0517.

Colorado Court of Appeals, Div. II.

August 12, 2004.

Moye Giles, LLP, Alison J. Thayer, Cormac T. Connor, Denver, Colorado, for Plaintiff-Appellee.

Peter Ortego, Towaoc, Colorado, for Defendant-Appellant.

Opinion by Judge CASEBOLT.

In this contract dispute involving the sovereign immunity of a federally recognized Indian tribe, defendant, Ute Mountain Ute Tribe, appeals the trial court's order denying its motion to dismiss the complaint of plaintiff, Rush Creek Solutions, Inc. We deny Rush Creek's motion to dismiss this appeal, affirm the trial court's order, and remand for further proceedings.

Rush Creek and the Tribe signed a contract in which Rush Creek agreed to provide the Tribe computer software and maintenance support. The Tribe's Chief Financial Officer (CFO) signed the contract on its behalf. The contract contains the following clause entitled "Default":

This Agreement shall be interpreted in accordance with the internal laws (as opposed to conflicts of law provisions) of the state of Colorado. As part of the consideration for the agreements contained herein, [the Tribe] hereby consents to the exclusive jurisdiction of any state or federal court with jurisdiction over the Town of Littleton, County of Arapahoe, State of Colorado. [The Tribe] waives any objection which [the Tribe] may have based on lack of jurisdiction or improper venue or forum non conveniens to any suit or proceeding instituted by [Rush Creek] under this Agreement in any state or federal court with jurisdiction over the Town of Littleton, County of Arapahoe, State of Colorado, and consents to the granting of such legal or equitable relief as is deemed appropriate by the court.

Alleging that the Tribe failed to make payments under the contract, Rush Creek initiated this action in the Arapahoe County District Court, asserting breach of contract, unjust enrichment, and promissory estoppel. In response, the Tribe filed a C.R.C.P. 12(b)(1) motion to dismiss, challenging subject matter jurisdiction based on sovereign immunity. The Tribe asserted that, while the CFO had authority to enter into contracts, he had no authority to waive its sovereign immunity, and it presented an affidavit of the Chairman of the Tribal Council so attesting.

In response, Rush Creek asserted that the quoted contract language expressly waived the Tribe's sovereign immunity. In addition, it asserted that, although the Tribe's Constitution authorizes the Tribal Council to prescribe tribal officials' duties, that document is silent concerning authority to waive the Tribe's sovereign immunity. Rush Creek contended that the Tribe had failed to prove that tribal officials, such as the CFO, were prohibited from waiving its sovereign immunity. Alternatively, Rush Creek requested the court's approval to conduct limited discovery on the issue.

In reply, the Tribe argued that neither the CFO's authority to sign the contract nor the Constitution's silence regarding who could waive sovereign immunity implied that the CFO had the authority to execute such a waiver.

Finding that there was no factual dispute and that the issue presented a question of law, the trial court denied the motion. It determined that the contract's default clause was a clear waiver of the Tribe's sovereign immunity. The court did not address the Tribe's contention that the CFO lacked the authority to waive its sovereign immunity.

Upon the Tribe's initial appeal of the trial court's order, a motions division of this court ordered the Tribe to show cause why the appeal should not be dismissed for lack of a final judgment. Following review of the parties' responses, the division concluded that this court lacked jurisdiction to consider the appeal pursuant to § 13-4-102, C.R.S.2003, but stated that the trial court's order might be appropriate for C.R.C.P. 54(b) certification. The division granted a limited remand for the Tribe to pursue certification. The trial court then certified its order as a final judgment for purposes of appeal under C.R.C.P. 54(b).

I.

Upon recertification of this appeal, Rush Creek moved to dismiss for lack of jurisdiction, asserting that the trial court improperly certified its order as a final judgment for purposes of appeal. Determination of that motion was deferred to the panel deciding the merits of the appeal. Hence, we first address that issue, and deny the motion.

Relying upon State Farm Fire & Casualty Co. v. Bellino, 976 P.2d 342 (Colo.App.1998), Rush Creek contends that the order denying the Tribe's motion to dismiss did not render a final judgment on any claims for relief raised in its complaint and that the court's C.R.C.P. 54(b) certification order does not meet the three-part Bellino certification test. The Tribe responds that the certification was proper or, alternatively, that its sovereign immunity defense authorizes the appeal. We agree with the Tribe's latter contention and therefore need not address the propriety of the certification.

Tribal sovereign immunity is not merely a defense to liability; rather, it provides immunity from suit. See Kiowa Tribe of Okla. v. Mfg. Techs., Inc., 523 U.S. 751, 118 S.Ct. 1700, 140 L.Ed.2d 981 (1998). Thus, under federal law, the denial of a motion to dismiss based on tribal sovereign immunity is an immediately appealable collateral order, because that immunity would be meaningless if a suit against a tribe were erroneously allowed to proceed to trial. See Tamiami Partners, Ltd. v. Miccosukee Tribe of Indians, 63 F.3d 1030 (11th Cir.1995)(analogizing a tribal sovereign immunity claim to a qualified immunity claim); see also Mitchell v. Forsyth, 472 U.S. 511, 105 S.Ct. 2806, 86 L.Ed.2d 411 (1985)(a denial of qualified immunity is immediately reviewable as a collateral order because qualified immunity shares the essential attribute of absolute immunity: an immunity from suit rather than simply a defense to liability); Osage Tribal Council v. United States Dep't of Labor, 187 F.3d 1174 (10th Cir.1999)(citing Tamiami and Mitchell, holding that denial of a motion to dismiss based on tribal sovereign immunity is an immediately appealable collateral order).

The appealability under Colorado law of an order denying a motion to dismiss based upon a tribal sovereign immunity defense is an issue of first impression. However, we do not write on a clean slate in this area. In City of Lakewood v. Brace, 919 P.2d 231 (Colo.1996), the supreme court held that when the issue presents only a question of law, interlocutory orders denying an individual's qualified immunity defense may be deemed final for purposes of appeal because such a defense is analogous to an absolute immunity defense that provides immunity from suit. In doing so, it noted that such interlocutory appeals are an exception to the general rule under § 13-4-102, C.R.S.2003, that an appeal cannot be taken from anything other than a final decision. See Feigin v. Digital Interactive Assocs., Inc., 987 P.2d 876 (Colo.App.1999)(citing City of Lakewood v. Brace, supra, for its conclusion that the denial of a motion to dismiss on the grounds of qualified immunity, which is normally not reviewable because it is not a final order, is immediately appealable when it is based on a question of law).

Moreover, the right to pursue an interlocutory appeal of a trial court's rejection of a qualified immunity defense exists under Colorado law even though federal law might not mandate its existence. In Furlong v. Gardner, 956 P.2d 545 (Colo.1998), the supreme court reaffirmed the City of Lakewood v. Brace holding and stated that it would continue to recognize a right to interlocutory appeal in this state, despite the United States Supreme Court's decision in Johnson v. Fankell, 520 U.S. 911, 117 S.Ct. 1800, 138 L.Ed.2d 108 (1997), that a defendant in a state court case brought under 42 U.S.C. § 1983 did not have a federal right to an interlocutory appeal from a denial of qualified immunity.

The Fankell Court reasoned that the Idaho Supreme Court's decision denying the right of interlocutory appeal following the trial court's rejection of a qualified immunity defense relied on a neutral state rule regarding court administration that did not specifically target civil rights claims against the state. But Furlong held that it would be a violation of Fankell's neutrality principle if Colorado courts simultaneously denied interlocutory appeals when qualified immunity is asserted in a § 1983 case, but allowed appeals in cases raising immunity under the Colorado Governmental Immunity Act (CGIA).

We conclude that disallowing an appeal of the trial court's order rejecting the Tribe's sovereign immunity claim, which is a claim to immunity from suit, but allowing an appeal of interlocutory orders in cases raising immunity under the CGIA or § 1983, would violate the neutrality principles identified in Fankell and applied in Furlong, and would render any tribal immunity meaningless. See Osage Tribal Council v. United States Dep't of Labor, supra; Tamiami Partners, Ltd. v. Miccosukee Tribe of Indians, supra. Thus, we recognize that an appeal may be taken from an interlocutory order denying a motion to dismiss based on tribal sovereign immunity when the issue presented is one of law, not of fact.

Here, the trial court denied the Tribe's sovereign immunity motion based on a question of law, namely, its interpretation of the parties' contract. Therefore, that decision is final and appealable. See Furlong v. Gardner, supra. Accordingly, we deny Rush Creek's motion to dismiss.

II.

While the Tribe contended in its opening brief that the default clause in the contract did not constitute an express waiver of sovereign immunity, in oral argument it conceded the issue. Accordingly, we will not address that matter further. However, the Tribe contends that, because the CFO did not...