Wesley v. Newland

SUMMARY

November 24, 2021

2021COA142

No. 20CA0649, Wesley v. Newland — Attorney Fees — Joint

and Several Fee Awards; Civil Procedure — Joinder

A division of the court of appeals addresses two issues of first

impression. First, whether the Colorado Rules of Civil Procedure

authorize joinder of former counsel for the purposes of

postjudgment proceedings in which attorney fees are sought.

Second, what a court must do to comply with the mandatory “shall

allocate” language in section 13-17-102(3), C.R.S. 2021, when

imposing an attorney fees award.

The division concludes that courts have the authority under

the Colorado Rules of Civil Procedure to join former counsel for the

purposes of postjudgment proceedings in which attorney fees are

sought. The division also concludes that, when imposing an

The summaries of the Colorado Court of Appeals published opinions

constitute no part of the opinion of the division but have been prepared by

the division for the convenience of the reader. The summaries may not be

cited or relied upon as they are not the official language of the division.

Any discrepancy between the language in the summary and in the opinion

should be resolved in favor of the language in the opinion.

attorney fees award, a district court must consider the allocation of

fees between the party and the party’s present or former counsel

and must make sufficient findings to enable meaningful appellate

review.

Given the district court concluded it lacked the authority to

join former counsel and did not make sufficient findings regarding

allocation, the division reverses and remands this issue for further

proceedings.

COLORADO COURT OF APPEALS 2021COA142

Court of Appeals No. 20CA0649

City and County of Denver District Court No. 18CV33631

Honorable Kandace C. Gerdes, Judge

Nicole Wesley,

Plaintiff,

and

Cornell Johnson,

Attorney-Appellee,

v.

Sarah Newland,

Defendant-Appellant.

ORDERS AFFIRMED IN PART, REVERSED IN PART,

AND CASE REMANDED WITH DIRECTIONS

Division II

Opinion by JUDGE BERGER

Yun and Davidson*, JJ., concur

Announced November 24, 2021

The Law Office of Cornell Johnson P.C., Cornell Johnson, Denver, Colorado, for

Attorney-Appellee

James Stadler, Jonathan Saadeh, Denver, Colorado, for Defendant-Appellant

*Sitting by assignment of the Chief Justice under provisions of Colo. Const. art.

VI, § 5(3), and § 24-51-1105, C.R.S. 2021.

1

¶ 1

The winning party in this civil case sought an award of

attorney fees under the frivolous and groundless litigation statute

against both the opposing party and her lawyer who had previously

withdrawn from representing her (withdrawn lawyer). The district

court awarded fees against the opposing party but did not address

whether fees should be awarded against the party’s withdrawn

lawyer. In a separate order, the court also imposed costs only

against the party.

¶ 2

Resolution of this appeal requires us to decide two legal

questions. Does the district court have the authority under the

Colorado Rules of Civil Procedure to join the former attorney as a

party for postjudgment proceedings under section 13-17-102,

C.R.S. 2021? What must the district court do to comply with

section 13-17-102(3)’s mandate that a court “shall allocate” the

payment of a fee award “among the offending attorneys and parties,

jointly or severally, as it deems most just”?

¶ 3

We hold that the district court has authority under the

Colorado Rules of Civil Procedure to join the former lawyer for these

purposes. We also hold that the court must consider the allocation

of fees between the party and the party’s present or former counsel

2

and must make sufficient findings to enable meaningful appellate

review. Applying these holdings, we reverse the district court’s

order denying joinder of former counsel, affirm the costs order, and

remand for further proceedings.

I. Relevant Facts and Procedural History

¶ 4

This appeal arises out of a tort action that concluded when the

district court granted defendant Sarah Newland’s motion to dismiss

for failure to prosecute.

¶ 5

Cornell Johnson represented plaintiff, Nicole Wesley, for most

of that lawsuit. About a month before trial, however, Johnson filed

an unopposed motion to withdraw on the grounds that Wesley had

terminated his representation. After holding a hearing, the district

court granted the motion, and Wesley proceeded pro se through

dismissal.

¶ 6

Relevant here, Newland made two postjudgment motions: a

motion for attorney fees under section 13-17-102(4) and a motion to

join Wesley’s former counsel Johnson as a party for postjudgment

proceedings under C.R.C.P. 19, 20, and 21. Newland also filed a

bill of costs that mentioned only Wesley, though the later attorney

fees motion also requested that costs be imposed against Johnson.

3

¶ 7

After ordering and receiving a response from Johnson (who

argued there was no precedent for joining a withdrawn attorney),

the district court denied the joinder motion. The entire order

provided as follows:

The Court has reviewed the Motion and

response, as well as the applicable legal

authority. The Court finds that CRCP Rule 19,

Rule 20 and/or Rule 21 do not contemplate

such a request by Defendant. Accordingly, the

Motion to Join Cornell Johnson (Plaintiff Nicole

Wesley’s dismissed counsel) in post-judgment

proceedings is DENIED.

¶ 8

Following its denial of the joinder motion, the court, without

holding a hearing, granted the attorney fees motion in part. That

order primarily considered the reasonableness of Newland’s fee

request and imposed fees against Wesley only. Possibly because

the court refused to join Johnson, the order did not indicate that

the court considered allocation of fees against him. In a separate

order, the court also imposed costs against Wesley and not

Johnson.

¶ 9

Newland appealed. Wesley has not filed a brief in this appeal,

but Johnson moved to intervene in the appeal, which this court

allowed over Newland’s objection, and has filed an answer brief.

4

II. Analysis

A. Joinder Motion

¶ 10

Newland first contends that the district court erred when it

denied her post-trial motion to join Johnson. We agree.

1. Standard of Review and Preservation

¶ 11

“Whether to join a party is within the sound discretion of the

trial court and will not be disturbed on appeal absent an abuse of

discretion.” City of Aurora ex rel. Util. Enter. v. Colo. State Eng’r,

105 P.3d 595, 623 (Colo. 2005), as modified on denial of reh’g (Feb.

14, 2005). A court abuses its discretion if its decision is “manifestly

arbitrary, unreasonable, or unfair, or if [the court] misapplies the

law.” AA Wholesale Storage, LLC v. Swinyard, 2021 COA 46, ¶ 32.

¶ 12

The parties agree that this issue was preserved.

2. Analysis

¶ 13

The Colorado Rules of Civil Procedure provide that “[p]arties

may be dropped or added by order of the court on motion of any

party . . . at any stage of the action and on such terms as are just.”

City of Aurora, 105 P.3d at 623 (quoting C.R.C.P. 21) (emphasis in

original). The rules “authorize joinder in situations where one party

seeks to join a person who may be liable for the same debt or

5

conduct that is already before the court.” Id. (emphasis added).

Specifically, C.R.C.P. 20(a) provides that

[a]ll persons may be joined in one action as

defendants if there is asserted against them

jointly, severally, or in the alternative, any

right to relief in respect of or arising out of the

same transaction, occurrence, or series of

transactions or occurrences and if any

question of law or fact common to all

defendants will arise in the action. A plaintiff

or defendant need not be interested in

obtaining or defending against all the relief

demanded.

¶ 14

These joinder rules “should be ‘liberally construed’” and

“indicate clearly a general policy to disregard narrow technicalities

and to bring about the final determination of justiciable

controversies without undue delay.” Stockdale v. Ellsworth, 2017

CO 109, ¶ 31 (quoting City of Aurora, 105 P.3d at 623).

¶ 15

The Colorado Supreme Court has twice affirmed joinder of a

party for the limited purpose of postjudgment proceedings in which

attorney fees were sought. In one case, a water court joined the

City of Aurora as a party after trial on the grounds that the city had

an agency relationship with one of the parties to the action. City of

Aurora, 105 P.3d at 621. The supreme court affirmed joinder of the

city “solely for the purpose of determining liability for attorney fees.”

6

Id. at 623. And in Stockdale, the court affirmed joinder of a

corporation’s alter ego owner for the purposes of seeking attorney

fees. Stockdale, ¶¶ 8, 30-31.

¶ 16

Applying both the plain language of the relevant rules and the

supreme court cases construing those rules, we conclude that

former counsel may be joined for the purpose of a postjudgment

motion seeking attorney fees under section 13-17-102. Former

counsel against whom attorney fees are sought “may be liable for

the same debt or conduct that is already before the court.” City of

Aurora, 105 P.3d at 623. That is, a court may conclude that the

attorney brought a civil action that lacked substantial justification

and is liable jointly or severally with the client for the opposing

party’s attorney fees. See § 13-17-102(3), (4).

¶ 17

Johnson argues that former counsel cannot be joined because

attorneys are “officers of the court, not parties.” We reject this

argument. Johnson cites no authority providing that attorneys

cannot be joined for the purposes of postjudgment proceedings

seeking attorney fees. Moreover, the Colorado Supreme Court has

rejected the broad proposition that an attorney can never be joined

as a party. See Vinton v. Virzi, 2012 CO 10, ¶¶ 11-13.

7

¶ 18

Newland conceded at oral argument that she did not argue

below that the district court continued to have jurisdiction over

Johnson after he was granted leave to withdraw. If continuing

jurisdiction exists, there might be no need to join Johnson as a

formal party. Because Newland raises this argument for the first

time on appeal (and presents it, at best, as an underdeveloped

argument), we do not decide it.1 See McGihon v. Cave, 2016 COA

78, ¶ 10 n.1; People v. Draper, 2021 COA 120, ¶ 99 n.11.

¶ 19

Ultimately, the district court’s conclusion that the Colorado

Rules of Civil Procedure did not authorize joinder of Johnson

misapplied the law and therefore was an abuse of discretion.

1 On remand, however, the court may address the question of

whether joinder of Johnson is even necessary when reconsidering

the joinder issue. See, e.g., Brown v. Silvern, 141 P.3d 871, 874

(Colo. App. 2005) (holding that a district court retained subject

matter jurisdiction over trial counsel even after the entry of

voluntary dismissal for the purposes of determining whether to

impose sanctions against trial counsel under C.R.C.P. 11 and 37 or

attorney fees under section 13-17-102, C.R.S. 2021); Holgate v.

Baldwin, 425 F.3d 671, 677 (9th Cir. 2005) (holding the fact an

attorney “was allowed to withdraw as counsel due to a conflict of

interest [did] not protect him from sanctions based on a filing that

he made before that withdrawal”); 2 James W. Moore et al., Moore’s

Federal Practice § 11.23(6)[a] (3d ed. 2021) (“[A] court may assess

sanctions against a lawyer who has withdrawn from a case before

the opposing party has moved for sanctions or the court has issued

a show cause order.”).

8

B. Attorney Fees Motion

¶ 20

Newland next contends that the district court erred by

granting her attorney fees motion only against Wesley and not

against Johnson.

1. Standard of Review and Preservation

¶ 21

A district court has “broad discretion when determining

whether to award attorney fees” and “absent an abuse of discretion,

its decision will not be disturbed on appeal.” In re Marriage of

Tognoni, 313 P.3d 655, 660-61 (Colo. App. 2011). Again, an abuse

of discretion occurs when the court misapplies the law. Swinyard,

¶ 32.

¶ 22

The parties dispute whether Newland preserved this issue.

Specifically, Johnson argues that the attorney fees motion was

untimely under C.R.C.P. 121, section 1-22(b). We reject this

argument because even assuming the motion was untimely, if a

district court accepts a filing beyond the timeline set forth in Rule

121 “without expressly granting an extension, it has impliedly

exercised its discretion under the rule.” US Fax L. Ctr., Inc. v. Henry

Schein, Inc., 205 P.3d 512, 516 (Colo. App. 2009).

9

¶ 23

Johnson goes further and argues that “[b]y failing to object to

[Johnson’s] motion to withdraw and failing to raise the issue of

attorney fees before the trial court granted [withdrawal],” Newland

waived this claim of error or invited the error.

¶ 24

We also reject this argument. Johnson has cited no authority

providing that an attorney immunizes himself from an attorney fees

award under the statute by withdrawing without opposition. We

conclude that given an attorney fees award may be assessed against

“an attorney . . . [who] brought or defended an action . . . that

lacked substantial justification,” an opposing party need not object

to withdrawal to later seek an attorney fees award. § 13-17-102(4)

(emphasis added).

¶ 25

Our conclusion also finds support in substantial Colorado and

federal authority. See Moore v. DeBruine, 631 P.2d 1194, 1195

(Colo. App. 1981) (holding a party who failed to present evidence

that a plaintiff’s claims were groundless until trial could still seek

an award); see also Holgate v. Baldwin, 425 F.3d 671, 677 (9th Cir.

2005) (holding the fact an attorney “was allowed to withdraw as

counsel due to a conflict of interest [did] not protect him from

sanctions based on a filing that he made before that withdrawal”);

10

Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 396 (1990) (holding a

Fed. R. Civ. P. 11 sanction determination may be made “after the

principal suit has been terminated”).

2. Analysis

¶ 26

Newland argues that when a district court imposes an

attorney fees award, it is required to allocate the award among the

offending attorney and party as it deems most just.2 We conclude

the district court abused its discretion when it failed — as best we

can tell from the record — to consider whether to allocate the

attorney fees award against Wesley, Johnson, or both, and when it

2 Newland cursorily argues that this court should also award

district court costs against Johnson because section 13-17-102(2)

authorizes the imposition of costs against an attorney under

Castillo v. Koppes-Conway, 148 P.3d 289, 292-93 (Colo. App. 2006).

Specifically, Newland argues that Castillo “included an award of

costs along with attorney fees against the plaintiff’s attorney under

C.R.S. § 13-17-102(2).” Newland is incorrect. Castillo is inapposite

because the costs portion of the award in that case was imposed

under C.A.R. 38, while the attorney fees portion was imposed under

section 13-17-102. Id. at 292-93. And section 13-17-102 makes

no mention of awarding costs against an attorney — the statute on

which Newland relies authorizes only the imposition of attorney fees

against an attorney. See § 13-17-102(1) (authorizing the award of

reasonable attorney fees “in addition to any costs otherwise

assessed”). Accordingly, we affirm the costs order.

11

failed to make factual findings sufficient to permit meaningful

appellate review on that issue.

¶ 27

When a court orders attorney fees under section 13-17-102,

the court “shall allocate the payment thereof among the offending

attorneys and parties, jointly or severally, as it deems most just,

and may charge such amount, or portion thereof, to any offending

attorney or party.” § 13-17-102(3) (emphasis added). “The

presumption is that the word ‘shall,’ when used in a statute, is

mandatory.” Swift v. Smith, 119 Colo. 126, 136, 201 P.2d 609, 614

(1948).

¶ 28

While the statute does not require a district court to impose

liability jointly and severally against a party and an attorney (or to

otherwise allocate the responsibility to pay the fees to the client or

attorney), the statute does require that a district court exercise its

discretion by at least considering doing so.

¶ 29

The district court’s attorney fees order does not comply with

this statutory mandate. True, Newland filed a motion for attorney

fees that specifically sought fees against Johnson. But we find no

indication in the court’s order or the record that the court exercised

its discretion.

12

¶ 30

In considering the required question of allocation, we also

conclude that the district court must make findings sufficient for an

appellate court to determine whether the court properly exercised

its discretion.

¶ 31

In Munoz v. Measner,3 the Colorado Supreme Court held that a

district court needs to make specific findings regarding certain

statutory factors only when granting an attorney fees award and not

when denying an award. 247 P.3d 1031, 1034-35 (Colo. 2011)

(discussing section 13-17-103(1), C.R.S. 2010). But when denying

the award, a district court “still must ‘make findings that will permit

meaningful appellate review.’” Id. at 1035 (quoting Bd. of Cnty.

Comm’rs v. Auslaender, 745 P.2d 999, 1001 (Colo. 1987)).

¶ 32

Just as a district court must make sufficient findings to allow

for meaningful appellate review of a fee award denial, we conclude a

court must also make factual findings that will permit meaningful

3 We recognize that the Colorado Supreme Court has held that a

district court must make specific factual findings under section 13-

17-103, C.R.S. 2021, when granting a fees motion and that a court

need not do so when denying a fees motion. See Munoz v. Measner,

247 P.3d 1031, 1034-35 (Colo. 2011). However, on appeal,

Newland challenges the denial of fees as to Johnson, which does

not require specific findings on those factors. See id. at 1035.

13

review of allocation under section 13-17-102(3). The district court’s

attorney fees order did not provide such findings.4

III. Conclusion

¶ 33

We reverse the order denying joinder of Johnson and remand

the case for further proceedings. We affirm the costs order. We do

not disturb the attorney fees award order entered against Wesley.

However, on remand, the district court must at least consider

allocating an attorney fees award against Johnson. If the court

exercises its discretion to do so, it may amend the order against

Wesley, and it must make sufficient findings to enable meaningful

appellate review.

JUDGE YUN and JUDGE DAVIDSON concur.

4 In Parker v. Davis, a case cited by neither the parties nor the

district court, a division of this court found that a district court

“implicitly rejected” an attorney’s argument to allocate fees between

the attorney and his client, which was “well within the range of

discretion” of the court under the statute. 888 P.2d 324, 326 (Colo.

App. 1994). The facts of Parker, however, are distinguishable, and

we do not view the case as inconsistent with our holding.