Sandstrom v. Solen, Court of Appeals No. 15CA0006

• Decision Date: 25 February 2016
• Docket Number: Court of Appeals No. 15CA0006
• Citation: 370 P.3d 669
• Parties: Sue SANDSTROM, Treasurer, Arapahoe County, Colorado, Plaintiff–Appellee, v. Gregory SOLEN and Patti L. Ibbotson, Defendants–Appellees, and Toby Bradford, Defendant–Appellant.
• Court: Colorado Court of Appeals

370 P.3d 669

Sue SANDSTROM, Treasurer, Arapahoe County, Colorado, Plaintiff–Appellee,

v. Gregory SOLEN and Patti L. Ibbotson, Defendants–Appellees,andToby Bradford, Defendant–Appellant.

Court of Appeals No. 15CA0006

Colorado Court of Appeals, Div. II.

Announced February 25, 2016

Ronald A. Carl, County Attorney, Monica N. Kovaci, Assistant County Attorney, Littleton, Colorado, for Plaintiff–Appellee.

Montgomery Little & Soran, PC, Echo D. Ryan, Frederick B. Skillern, Greenwood Village, Colorado, for Defendant–Appellee Gregory Solen.

The Hayes Law Firm LLC, Christopher Hayes, Denver, Colorado, for Defendant–Appellee Patti L. Ibbotson.

Zarlengo & Kimmell, LLC, Thomas J. Kimmell, Denver, Colorado, for Defendant–Appellant.

Opinion by JUDGE GRAHAM

¶ 1 In this real property action concerning a tax deed,¹ we must determine the validity of that deed, which was admittedly issued by the treasurer without diligent inquiry. Further, we are required to determine whether the property covered by the tax deed may be redeemed by one tenant in common for the benefit of another tenant in common.

¶ 2 Toby Bradford appeals the district court's grant of summary judgment concluding that the Arapahoe County Treasurer (Treasurer) properly invalidated a tax deed in favor of Bradford. Bradford also appeals the district court's grant of summary judgment quieting title to the subject property in Gregory Solen and Patti L. Ibbotson. We affirm.

I. Background

Before any purchaser ... of a tax lien ... is entitled to a deed for the land ... [t]he treasurer shall serve ... a notice of such purchase on ... all persons having an interest or title of record in or to the same if, upon diligent inquiry, the residence of such persons can be determined....

§ 39–11–128(1)(a), C.R.S. 2015

.

¶ 3 Here the subject property was assessed as a fifty-percent undivided interest in mineral rights beneath surface property owned by Bradford in Arapahoe County. That undivided mineral interest was conveyed as two undivided interests to Gregory Solen and his sister, Patti Ibbotson. Their ownership is derived from the following series of events.

¶ 4 In May 1972, Albert Solen purchased by warranty deed the entire surface estate and a fifty-percent undivided mineral interest in the property. In April 1973, Albert Solen sold the surface estate to Hugh and Janelle Thomas but reserved his fifty-percent mineral interest. The Arapahoe County Assessor's Office assessed that mineral interest as parcel # 1979–00–0–00–855 (the Parcel).

¶ 5 In 1984, Albert Solen's mineral interest passed to Gregory Solen and the Colorado National Bank of Denver as trustee (Bank)² by personal representative mineral deed. Each received an undivided one-half interest and unity of ownership in the assessed Parcel which itself was one-half of the original mineral estate.³

¶ 6 In 1994, by trustee's mineral deed of distribution, the Bank transferred to Patti Ibbotson "all interest belonging to [the Bank] in and to all of the oil, gas and other minerals in and under and that may be produced from" the assessed Parcel. Thereafter she and her brother each owned an undivided one-half interest in the Parcel. A copy of that deed was filed with the Arapahoe County Clerk and Recorder on November 28, 1994, but the Assessor's records were not updated to reflect Ibbotson's interest. Accordingly, based on the Assessor's records, the Treasurer (tasked with collecting taxes assessed by the Assessor) billed the Parcel by mailing tax bills only to Gregory Solen.

¶ 7 The taxes for the Parcel went unpaid for tax years 2004, 2005, 2006, and 2007. In 2005, Bradford⁴ purchased the 2004 tax lien.

¶ 8 On August 30, 2008, Bradford applied for a tax deed for the Parcel. The Treasurer sent notice to Solen of the application for the tax deed but did not obtain title work for the Parcel or check the County Clerk and Recorder's records. On February 26, 2009, without Solen redeeming the Parcel, a tax deed was issued to Bradford by the Treasurer. The deed transferred all mineral interests taxed under the assessed Parcel, that is, the entire undivided one-half interest in the mineral estate.⁵

¶ 9 In 2013, the Treasurer was notified by an oil and gas lessee of Ibbotson's that she claimed ownership in the Parcel that was the subject of the Bradford tax deed. On August 26, 2013, the Treasurer issued and recorded a declaration of invalid treasurer's deed, purporting to invalidate the tax deed given to Bradford.

¶ 10 In December 2013, the Treasurer filed the current action seeking a declaratory judgment that the declaration of invalid treasurer's deed was a valid document, thereby cancelling title in Bradford. The Treasurer's complaint admitted that she had failed to conduct diligent inquiry pursuant to section 39–11–128(1)(a)

prior to issuing the tax deed in favor of Bradford and requested the court to approve her declaration of invalid treasurer's deed. The Treasurer named Bradford, Solen, and Ibbotson as defendants.

¶ 11 Bradford counterclaimed against the Treasurer and cross-claimed against Solen and Ibbotson for a decree quieting title in the Parcel.⁶ Solen and Ibbotson answered, and Solen cross-claimed against Bradford to quiet title in the Parcel.

¶ 12 Ultimately, the district court concluded:

There is no dispute that the Treasurer failed to determine all persons having title of record of the property and failed to provide notice to those persons, specifically ... Ibbotson. The evidence fully justifies that the Treasurer did not make "diligent inquiry" to locate ... Ibbotson. Had the Treasurer obtained title work for the mineral rights or checked the County Clerk and Recorder's records ... Ibbotson could have been served. Accordingly, the Treasurer's Deed issued on or about February 26, 2009 is invalid and void and the Declaration of Invalid Treasurer's Deed issued on August 23, 2013, is valid.

....

" ‘A void deed is a nullity, invalid ab initio, or from the beginning, for any purpose. It does not, and cannot, convey title, even if recorded.’ " Lake Canal Reservoir [Co. v. Beethe , 227 P.3d 882, 887 (2010)

] (quoting Delsas ex rel. Delsas v. Centex Home Equity Co. , 186 P.3d 141, 144 (Colo. App. 2008) ). Additionally, the Treasurer is required to sell each separately assessed parcel as a single lien. [§ 39–11–108, C.R.S. 2015 ]. The tax lien encumbers the entire piece of property. [§ 39–11–115(1), C.R.S. 2015 ]. In this case ... Solen and ... Ibbotson each owned an undivided one-half interest in the parcel. Therefore, the parcel was sold for taxes as one parcel as evidenced by the Treasurer's Deed. Because the Court finds the Treasurer's Deed in this case void, it is void from the beginning and for any purpose.

¶ 13 The district court entered summary judgment in favor of the Treasurer, Solen, and Ibbotson. Bradford appeals.

II. Standing

¶ 14 Initially we address Bradford's contention that Solen lacks standing in this action. "Standing is a component of subject matter jurisdiction and is a constitutional prerequisite to maintaining a lawsuit." Maralex Res., Inc. v. Chamberlain, 2014 COA 5, ¶ 8, 320 P.3d 399

. "It is also a question of law which we review de novo." Id.

¶ 15 First, as to the declaratory judgment, Solen is a defendant and need not establish standing. Mortg. Invs. Corp. v. Battle Mountain Corp. , 70 P.3d 1176, 1182 (Colo. 2003)

("We have held that traditional standing principles do not apply to defendants.").

¶ 16 Second, as to Solen's cross-claim to quiet title, C.R.C.P. 105

governs actions concerning real estate.

An action may be brought for the purpose of obtaining a complete adjudication of the rights of all parties thereto, with respect to any real property and for damages, if any, for the withholding of possession. The court in its decree shall grant full and adequate relief so as to completely determine the controversy and enforce the rights of the parties. The court may at any time after the entry of the decree make such additional orders as may be required in aid of such decree.

C.R.C.P. 105(a)

.

¶ 17 "Parties in Colorado ‘benefit from a relatively broad definition of standing.’ " Maralex Res., ¶ 9

(quoting Ainscough v. Owens, 90 P.3d 851, 855 (Colo. 2004) ). "To demonstrate standing, a plaintiff must prove an injury-in-fact to a legally protected interest." Id."[A] legally protected interest may be tangible or intangible. It may rest in property, arise out of contract, lie in tort, or be conferred by statute." Id. (alteration in original) (quoting Barber v. Ritter, 196 P.3d 238, 246 (Colo. 2008) ).

¶ 18 Here, Solen claims ownership of the Parcel as a tenant in common with Ibbotson. Bradford also claims ownership of the Parcel. The purpose of C.R.C.P. 105

is to "resolv[e] competing claims that exist at a particular time" and to "grant ‘full and adequate relief so as to completely determine the controversy.’ " Argus Real Estate, Inc. v. E–470 Pub. Highway Auth., 109 P.3d 604, 612 (Colo. 2005) (quoting 5 Cathy Stricklin Krendl, Colorado Practice Series, Civil Rules Annotated § 105.2 (3d ed. 1998), and C.R.C.P. 105 ). Property is a legally protected interest, Maralex Res., ¶ 9, and Bradford's claim to the Parcel injures Solen's claim to that same Parcel. Consequently, Solen has established an injury-in-fact to a legally protected interest.

¶ 19 Third, Bradford cross-claimed against Solen to quiet title. As a defendant to that claim, Solen could argue any affirmative defense available to him. See People ex rel. Simpson v. Highland Irrigation Co., 893 P.2d 122, 127 (Colo. 1995)

("[T]he only role for the defendants is to defend against the suit. The defendants' affirmative defense does not constitute an independent cause of action, but is a defensive claim only. Therefore, the rules for determining whether a plaintiff has standing are simply inapplicable to the defendants in this case."). This includes an affirmative defense that the statutory requirements of section 39–11–128(1)(a) were not complied with because all persons did not receive notice...