v. Shenandoah Homeowners Ass'n

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.

SUMMARY
February 20, 2020

2020COA31

No. 18CA1592, Kroesen v. Shenandoah Homeowners Ass’n —
Real Property — Easements Appurtenant — Common Interest
Communities — Colorado Common Interest Ownership Act

On a matter of first impression, a division of the court of

appeals analyzes the amount of specificity necessary in a recorded

document to establish an enforceable easement within a common

interest community. The division specifically evaluates whether the

developer of two subdivisions created a valid easement for property

owners of one subdivision to use certain roads within the other

subdivision when the plats for the subdivision burdened by the

easement did not expressly refer to the easement. Because the

Colorado Common Interest Ownership Act contains specific

statutory requirements for creating an easement and supplements

traditional common law principles, the division addresses whether
the developer complied with the requirements of the Act and the

common law. The division holds that the developer complied with

the Act and the common law and, thus, created an enforceable

easement.

The division additionally analyzes whether a party is entitled to

recover lost profits on a claim for intentional interference with a real

estate sales contract. Because the subject property had not become

unmerchantable, the division holds that the party was not entitled

to recover lost profit damages and affirms the district court’s

calculation of damages.
COLORADO COURT OF APPEALS 2020COA31

Court of Appeals No. 18CA1592
La Plata County District Court No. 17CV30018
Honorable Todd P. Norvell, Judge

Ronald J. Kroesen and Patricia L. Kroesen,

Plaintiffs-Appellees and Cross-Appellants,

v.

Shenandoah Homeowners Association, Inc., a Colorado nonprofit corporation,
and Ronald Burris, in his official capacity as Director of the Shenandoah
Homeowners Association, Inc.,

Defendants-Appellants and Cross-Appellees.

JUDGMENT AFFIRMED

Division VII
Opinion by JUDGE LIPINSKY
Fox and Berger, JJ., concur

Announced February 20, 2020

Goldman, Nicholson & Mack, P.C., Lindsey K.S. Nicholson, Josh W. Mack,
Durango, Colorado, for Plaintiffs-Appellees and Cross-Appellants

Campbell, Wagner, Frazier & Dvorchak, LLC, Colin C. Campbell, Greenwood
Village, Colorado, for Defendants-Appellants and Cross-Appellees
¶1 Plaintiffs, Ronald J. and Patricia L. Kroesen, owners of land in

the Shenandoah Highlands Subdivision (Highlands Subdivision) in

La Plata County, seek to access their property over two roads in the

adjoining Shenandoah Subdivision. The Kroesens argue they have

an easement over the roads based on language in plats that the

developer of both subdivisions recorded as amendments to each

subdivision’s declarations.

¶2 Defendants, Shenandoah Homeowners Association, Inc. and

Ronald Burris, the president of the Association (jointly, Shenandoah

Association), respond that the developer failed to comply with the

statutory requirements for creating an easement in a common

interest community. Shenandoah Association specifically argues

that the developer failed to provide future owners of lots in

Shenandoah Subdivision the required record notice of the

easement.

¶3 The Kroesens also assert an intentional interference with

contract claim against Shenandoah Association. They allege that

Shenandoah Association’s refusal to recognize the easement caused

the Kroesens to lose a contract to sell their property to a third

1
party. The Kroesens seek lost profits and other damages on that

claim.

¶4 Following a bench trial, the district court entered judgment in

favor of the Kroesens on their claims for declaratory judgment and

intentional interference with contract. The court found that the

developer complied with the requirements for creating an easement

and that Shenandoah Association intentionally interfered with the

Kroesens’ contract to sell their property. It awarded the Kroesens

damages for intentional interference with contract, including the

cost of holding and maintaining the property from the date of the

interference until two years following the judgment. But the court

did not award the Kroesens lost profits.

¶5 Shenandoah Association appeals the judgment entered in

favor of the Kroesens. The Kroesens appeal the district court’s

denial of their request for lost profits.

¶6 The appeals raise an issue of first impression in this state —

the amount of specificity necessary in a recorded document to

establish an enforceable easement within a common interest

community.

¶7 We affirm.

2
I. The Two Subdivisions

¶8 In 1984, Shenandoah Limited (the developer) began developing

a 993-acre parcel (original property) in La Plata County. As relevant

to this appeal, the developer divided the original property into two

subdivisions — Shenandoah Subdivision, created in 1989, and

Highlands Subdivision, created in 1994 — by recording declarations

for each. (A “declaration” is a “recorded instrument[] . . . that

create[s] a common interest community . . . including . . . plats and

maps.” § 38-33.3-103(13), C.R.S. 2019. A “plat” is the “part of a

declaration that . . . depicts all or any portion of a common interest

community in two dimensions . . . .” § 38-33.3-103(22.5).) The

developer established a homeowner’s association for each

subdivision.

¶9 The developer also recorded plats that depicted the two roads

at issue, known as Colonial Drive (or Colonial Road) and Blue Ridge

Road. Portions of the roads follow the boundary between the two

subdivisions. The plats also created an easement (the Subject

Easement) that arguably allowed the owners of lots in Highlands

Subdivision to access their properties over the roads.

3
¶ 10 The pre-1994 plats amending the declaration for Shenandoah

Subdivision referenced the Subject Easement, albeit in general

terms, as they pre-dated the creation of Highlands Subdivision.

Those plats described the Subject Easement as:

• an access road easement “dedicated to [the developer

and] the Shenandoah Homeowners Association”;

• consisting of “General Common Elements . . . for the use

and benefit of [the developer], the owners of the lots

within [Shenandoah Subdivision and] adjacent

subdivisions”;

• “for the use of [the developer]” and the owners of each lot

created by the plat for the original property; and

• dedicated to the developer and “the present and future

owners of [Shenandoah Subdivision].”

None of the pre-1994 plats described “adjacent subdivisions” with

greater specificity.

¶ 11 After the developer created Highlands Subdivision, the

developer and the then owner of the Kroesens’ lot (the former

owner) each independently recorded a plat relevant to our analysis.

The developer recorded a plat entitled “Shenandoah Highlands

4
Subdivision No. 2 Project 95-88” (Highlands Plat) that created new

tracts, including Tracts A and B, within Highlands Subdivision;

asserted that the developer owned Colonial Drive and Blue Ridge

Road; and expressly stated that “[n]ormal access for Tract A will be

via Blue Ridge and Colonial Drive to County Road 141.”

¶ 12 The former owner recorded a plat consolidating Tracts A and B

into Tract AB (Tract AB Plat). Residential construction on Tract AB

was limited to the portion that was formerly Tract A.

¶ 13 According to the Highlands and Tract AB Plats, not only is

Tract AB adjacent to Shenandoah Subdivision, but it abuts Blue

Ridge Road:

5
6
Blue Ridge Road merges into Colonial Drive north of Tract AB.

¶ 14 Before the former owner consolidated Tracts A and B, the

Board of Directors of Shenandoah Homeowners Association

approved an easement over Blue Ridge Road to benefit Tract A.

(The record does not specify whether the Board approved a similar

easement over Colonial Drive.) Although the Board’s action appears

in its meeting minutes, no recorded document reflects the Board’s

approval of the Subject Easement. The members of Shenandoah

Homeowners Association did not ratify the Board’s approval of the

Subject Easement or otherwise authorize an easement to benefit

Tract AB.

¶ 15 In 1999, the Kroesens purchased Tract AB from the former

owner for $160,000. In 2015, the Kroesens signed a contract to sell

Tract AB for $188,500. Before the closing on the sale, however,

Burris, in his capacity as president of the Board of Directors of

Shenandoah Homeowners Association, told the Kroesens’ real

estate agent that the owners of Tract AB had no right to use either

road.

¶ 16 The prospective purchaser refused to close on the purchase of

the Kroesens’ property after learning that the owners of Tract AB

7
may not have an easement over the roads. The Kroesens claim

that, after the sale fell through, they were unable to find a

purchaser willing to buy Tract AB without access to the roads.

II. Procedural History

¶ 17 The Kroesens sued to obtain, among other relief, (1) a

declaratory judgment that the owners of Tract AB have an easement

over the roads; (2) a permanent injunction enjoining Shenandoah

Association from interfering with their access to Tract AB over the

roads; (3) an award of their expenses associated with the failed sale

of their property and lost profits for Shenandoah Association’s

intentional interference with their purchase contract; and (4)

damages for slander of title arising from Shenandoah Association’s

assertion, through Burris, that the owners of Tract AB did not have

an easement over the roads.

¶ 18 The district court granted summary judgment to the Kroesens

on their declaratory judgment claim. (The parties expressly agreed

there were no disputed issues of material fact.) In a well-reasoned

order, the court ruled that the plats for Shenandoah Subdivision

were sufficient to establish an easement over the roads benefitting

8
Tract AB. However, the court’s order did not expressly resolve

whether the Kroesens were entitled to a permanent injunction.

¶ 19 The court resolved the Kroesens’ claims for intentional

interference with contract and slander of title following a bench

trial. The court awarded the Kroesens damages on the intentional

interference with contract claim to compensate them for their

inability to sell the property. The damages took the form of

approximately five years of maintenance expenses. The court

declined to award lost profits, however, because it concluded that

the Kroesens would eventually be able to sell the property at or

above the $188,500 purchase price specified in the terminated

contract.

¶ 20 The court resolved the slander of title claim in favor of

Shenandoah Association because the Kroesens had not proved the

element of malice.

¶ 21 Following the bench trial, Shenandoah Association appealed

the district court’s declaratory judgment holding, and the Kroesens

cross-appealed the court’s denial of their request for lost profits.

¶ 22 After discovering that the district court may not have resolved

the Kroesens’ second claim, thus depriving this court of

9
jurisdiction, see Richmond Am. Homes of Colo., Inc. v. Steel Floors,

LLC, 187 P.3d 1199, 1202 (Colo. App. 2008) (noting that as a

general rule, “an entire case must be resolved by a final judgment

before an appeal is brought”), a division of this court remanded the

case to the district court. The division instructed the district court

to ensure that a final judgment entered on all of the Kroesens’

claims. The district court then entered an order dismissing the

Kroesens’ second claim and noting that a final judgment had been

entered on all of their claims.

III. The District Court Correctly Determined that Tract AB Was the
Beneficiary of an Easement to Use the Roads

¶ 23 Shenandoah Association’s appeal raises three principal issues.

¶ 24 First, we consider and reject the Kroesens’ contention that

Shenandoah Association failed to preserve its argument that the

recorded documents did not put good faith purchasers of property

in Shenandoah Subdivision on notice of the Subject Easement.

¶ 25 Second, we decide whether, under common law principles, the

plats amending the declaration for Shenandoah Subdivision

contained sufficient specificity to create an easement over the roads

benefitting Tract AB. Although we agree with the district court that

10
“‘adjacent subdivisions, and future subdivisions’ is a thin

description of a dominant estate,” we conclude the language is

sufficient in light of the “surrounding circumstances, the situation

of the parties, and the objects to be obtained.” Lewitz v. Porath

Family Tr., 36 P.3d 120, 123 (Colo. App. 2001).

¶ 26 Third, because Shenandoah Subdivision and Highlands

Subdivision are common interest communities subject to the

Colorado Common Interest Ownership Act (CCIOA), §§ 38-33.3-101

to -402, C.R.S. 2019, we also address whether the developer

complied with the CCIOA’s requirements for creating an easement.

The common law and CCIOA tests apply to easements in common

interest communities. See § 38-33.3-108, C.R.S. 2019 (stating that

the “law of real property . . . supplement[s] the provisions of [the

CCIOA], except to the extent inconsistent with [the CCIOA]”);

§ 38-33.3-115, C.R.S. 2019 (explaining that the CCIOA “applies to

all common interest communities created within this state”).

¶ 27 We hold that the developer complied with both sets of

requirements for creating an easement and, therefore, conclude

that Tract AB benefits from the Subject Easement.

11
A. Shenandoah Preserved Its Notice Argument

¶ 28 Because Shenandoah Association raised the notice issue in

the district court in its briefing on summary judgment, and because

the court considered and rejected the argument, Shenandoah

Association is entitled to appellate review of the ruling on whether

the owners of land in Shenandoah Subdivision received record

notice of the Subject Easement. See Brown v. Am. Standard Ins. Co.

of Wis., 2019 COA 11, ¶ 21, 436 P.3d 597, 600 (“If a party raises an

argument to such a degree that the [trial] court has the opportunity

to rule on it, that argument is preserved for appeal.”).

¶ 29 Thus, we hold that Shenandoah Association preserved its

notice argument.

B. We Affirm the District Court’s Ruling That, Under the Common
Law Test for Creating an Easement, Tract AB Benefits From an
Easement Over the Roads

1. Legal Authority

¶ 30 We review de novo the court’s ruling on summary judgment

that Tract AB benefits from an easement over the roads. See City of

Lakewood v. Armstrong, 2017 COA 159, ¶ 7, 419 P.3d 1005, 1008.

Summary judgment is appropriate when there is no genuine issue

of material fact and the moving party is entitled to judgment as a

12
matter of law. C.R.C.P. 56(c); Pulte Home Corp. v. Countryside

Cmty. Ass’n, 2016 CO 64, ¶ 22, 382 P.3d 821, 826.

¶ 31 Similarly, we review de novo the district court’s interpretation

of recorded instruments. Ryan Ranch Cmty. Ass’n v. Kelley, 2016

CO 65, ¶ 24, 380 P.3d 137, 142. We give words and phrases their

common meanings and will enforce recorded instruments as written

if their meaning is clear. Pulte Home, ¶ 23, 382 P.3d at 826.

¶ 32 “An easement is a right conferred by grant, prescription or

necessity authorizing one to do or maintain something on the land

of another . . . .” Lazy Dog Ranch v. Telluray Ranch Corp., 965 P.2d

1229, 1234 (Colo. 1998). No particular words are necessary to

grant an easement, so long as the instrument identifies with

“reasonable certainty” the easement created and the dominant and

servient tenements. Hornsilver Circle, Ltd. v. Trope, 904 P.2d 1353,

1356 (Colo. App. 1995). (A dominant estate is the property that

benefits from the easement, while the servient estate is the property

on which the easement is located. Lazy Dog, 965 P.2d at 1234.)

“When interpreting an easement, we must consider the language

used in the instrument, the circumstances surrounding its

13
creation, and the purpose for which it was created.” Lewitz, 36

P.3d at 122.

2. Application

¶ 33 Shenandoah Association contends that the “isolated, generic

reference” to the roads being for the benefit of the developer and

“adjacent subdivisions” in the amended declaration for Shenandoah

Subdivision does not place good faith purchasers of property within

Shenandoah Subdivision on notice of the Subject Easement. It

argues that, because Lewitz held that a valid easement requires

notice to good faith purchasers of the nature and extent of the

easement, see id. at 124, the Subject Easement fails the common

law notice test. We disagree.

¶ 34 The Kroesens contend that plats amending the declaration for

Shenandoah Subdivision created the Subject Easement. They point

to the plat entitled “Shenandoah Category 1 Project 88-130,” which

stated that “General Common Elements . . . [are] for the use and

benefit of the Developer, the owners of the lots within this

subdivision, subdivisions previously filed, [and] adjacent

subdivisions . . . .” (Emphasis added.) (“General Common

Elements” include easements. See § 38-33.3-103(5)(b), (25).)

14
¶ 35 Although, as noted above, no particular language is required

to create an easement, the language must still describe the

easement, dominant estate, and servient estate “with reasonable

certainty.” Hornsilver Circle, 904 P.2d at 1356. The amendments to

the declaration for Shenandoah Subdivision referring to “General

Common Elements,” noting “the purpose of ingress and egress” and

creating Colonial Drive and Blue Ridge Road, describe the nature of

the Subject Easement with reasonable certainty. The plats also

provide reasonable certainty as to the identity of the servient estate

— Shenandoah Subdivision — where the roads are located.

¶ 36 Further, the reference to “adjacent subdivisions” is sufficient

to describe a dominant estate — Highlands Subdivision — and

specifically those tracts in Highlands Subdivision that abut one of

the roads. Only under the narrowest possible reading of the plats

could a reference to “adjacent subdivisions” not encompass a tract

carved out of the original property, such as Tract AB, that borders

Blue Ridge Road.

¶ 37 Thus, we agree with the district court’s holding that the

language of the plats for Shenandoah Subdivision places good faith

purchasers of tracts in Shenandoah Subdivision on notice of the

15
Subject Easement. We reach this conclusion based on the

“language used in the instrument, the circumstances surrounding

[the easement’s] creation, . . . the purpose for which [the easement]

was created,” and the record notice in Shenandoah Subdivision’s

chain of title describing the Subject Easement. Lewitz, 36 P.3d at

122.

¶ 38 Lastly, in light of our reading of the amendments to the

declaration for Shenandoah Subdivision, we need not address

whether the vote of the Board of Directors of Shenandoah

Homeowners Association was sufficient, with or without a vote of

approval by the members of the Shenandoah Homeowners

Association, to create a valid easement over the roads. And we need

not reach Shenandoah Association’s argument that the developer

and the former owner believed that the owner of Tract AB did not

benefit from an easement. Even if this contention is correct, which

we cannot determine from the record, it is irrelevant to the

existence of an easement.

C. The Developer Also Complied With the CCIOA’s Requirements
for Creating an Easement

16
¶ 39 Because the developer created the Subject Easement in plats

amending the declaration to Shenandoah Subdivision, we must

next consider whether the developer complied with the CCIOA’s

requirements for creating an easement. The Subject Easement

would be invalid if the developer did not comply with the common

law and CCIOA requirements for easements.

See §§ 38-33.3-108, -115.

1. Legal Authority

¶ 40 The meaning and effect of statutes are questions of law that

we review de novo. Ryan Ranch, ¶ 25, 380 P.3d at 142. When

interpreting statutory provisions, “[o]ur objective is to effectuate the

intent and purpose of the General Assembly.” Perfect Place, LLC v.

Semler, 2018 CO 74, ¶ 40, 426 P.3d 325, 332 (quoting Trujillo v.

Colo. Div. of Ins., 2014 CO 17, ¶ 12, 320 P.3d 1208, 1212-13). “To

determine the legislature’s intent, we look first to the plain language

of a statutory provision.” Id. Where clear, “we apply the plain and

ordinary meaning of the provision,” id., “because the General

Assembly is presumed to have meant what it plainly said,” Miller v.

Curry, 203 P.3d 626, 629 (Colo. App. 2009) (quoting Silverview at

Overlook, LLC v. Overlook at Mt. Crested Butte Ltd. Liab. Co., 97 P.3d

17
252, 255 (Colo. App. 2004)). When “reading a statute . . . or a

recorded instrument, we consider the text as a whole, harmonizing,

when possible, all sections or provisions.” McMullin v. Hauer, 2018

CO 57, ¶ 13, 420 P.3d 271, 274.2.

2. Application

¶ 41 Shenandoah Association contends that the developer did not

comply with the requirements for creating easements found in the

CCIOA. See Perfect Place, ¶¶ 41-48, 426 P.3d at 332-34; Ryan

Ranch, ¶¶ 33-52, 380 P.3d at 144-48. It specifically asserts that

the developer did not properly exercise its “development rights”

when it sought to create the Subject Easement. In support of this

argument, Shenandoah Association alleges that the developer (1)

failed to include a legally sufficient description of the Subject

Easement in the plats amending the declaration for Shenandoah

Subdivision and (2) did not record the Highlands Plat — the only

plat expressly referencing an easement for the benefit of the owners

of Tract AB — in the chain of title for Shenandoah Subdivision.

Thus, according to Shenandoah Association, the Subject Easement

is not binding on any property within Shenandoah Subdivision. We

consider and reject these arguments below.

18
a. The Developer Properly Exercised Development Rights When It
Created the Subject Easement

¶ 42 The developer properly exercised development rights when it

sought to create the Subject Easement through amendments to the

declaration for Shenandoah Subdivision. Section

38-33.3-103(14)(b) defines “development rights” as “any right or

combination of rights reserved by a declarant in the declaration

to . . . [c]reate . . . common elements, or limited common elements

within a common interest community.” Section 38-33.3-103(5)(b)

defines “common elements” as “any real estate within a planned

community owned or leased by the association, other than a unit.”

And the definition of “real estate” in section 38-33.3-103(25)

includes “interests that, by custom, usage, or law, pass with a

conveyance of land.” Such interests include appurtenant

easements, such as the Subject Easement, which run with a

particular property. See Restatement (Third) of Property: Servitudes

§ 1.5 (Am. Law Inst. 2000) (distinguishing between “appurtenant

easements,” which are tied to ownership or occupancy of a

particular parcel, and “easements in gross,” which are not).

19
¶ 43 The developer reserved for itself a development right to

“establish a non-exclusive easement and right of way [over] all or

any portion of the [original property]” in the declaration for

Shenandoah Subdivision and later exercised that right in plats

amending the declaration.

¶ 44 Shenandoah Association misquotes section 38-33.3-209,

C.R.S. 2019, in arguing that “each map or plat shall contain a

legally sufficient description of all easements serving or burdening

any portion of the common interest community.” (Emphases added

by Shenandoah Association.)

¶ 45 Rather, section 38-33.3-209(2)(e) says that “each map shall

show the following, except to the extent that such information is

contained in the declaration or on a plat: . . . To the extent feasible,

a legally sufficient description of all easements serving or burdening

any portion of the common interest community.” Thus, if “a legally

sufficient description of all easements” appears in “the declaration

or on a plat,” the plain language of section 38-33.3-209(2)(e) does

not require duplicative language in every plat amending a

declaration.

20
¶ 46 Shenandoah Association does not dispute that the amended

declaration for Shenandoah Subdivision generally describes the

Subject Easement. Under the CCIOA, the developer was not

required to expressly reference the Subject Easement in each plat.

§ 38-33.3-209(1) (specifying that “[t]he requirements of this section

shall be deemed satisfied so long as all of the information required

by this section is contained in the declaration, a map or a plat, or

some combination of any two or all of the three”); § 38-33.3-

209(2)(e); Ryan Ranch, ¶ 34, 380 P.3d at 144.

¶ 47 Shenandoah Association essentially challenges the sufficiency

of the description of the Subject Easement in the amended

declaration for Shenandoah Subdivision. As explained above,

under the common law rule, the developer adequately put the

owners of lots in Shenandoah Subdivision on notice that the future

owners of lots adjacent to Shenandoah Subdivision would benefit

from an easement over the roads.

¶ 48 Unlike the other requirements for maps set forth in the

CCIOA, descriptions of easements need only be “legally sufficient.”

See § 38-33.3-209(2)(e). This caveat demonstrates that section

38-33.3-209(2)(e) does not impose a more stringent requirement for

21
descriptions of easements than those required under the common

law. Thus, we conclude that the developer satisfied the

requirements for describing an easement set forth in the CCIOA.

b. The Developer’s Recorded Plats Comply with Section 38-33.3-
217

¶ 49 We also disagree with Shenandoah Association’s argument

that the developer ran afoul of the requirements of section 38-33.3-

217, C.R.S. 2019. Section 38-33.3-209(6) requires the declarant to

record an amendment to the original declaration for the subdivision

when exercising a development right. Section 38-33.3-217(3), in

turn, requires that “[e]very amendment to the declaration must be

recorded in every county in which any portion of the common

interest community is located.” Under the plain language of section

38-33.3-217(3), the developer satisfied its obligation under the

CCIOA to amend the declaration for Shenandoah Subdivision when

it exercised its development rights by creating the Subject

Easement. The developer recorded in La Plata County amendments

to the declaration for Shenandoah Subdivision that referenced the

Subject Easement and said that the “General Common Elements,”

22
which included the Subject Easement, were “for the use and benefit

of . . . adjacent subdivisions.”

c. Prospective Buyers of Shenandoah Subdivision Tracts Are on
Record Notice of the Easement From Shenandoah
Subdivision’s Plats

¶ 50 We do not agree that a prospective buyer of property in

Shenandoah Subdivision would lack notice of the Subject

Easement. As explained above, the plats amending the declaration

for Shenandoah Subdivision created a valid easement. The Subject

Easement is valid even though the amendments to the declaration

for Shenandoah Subdivision did not expressly say that the Subject

Easement benefits the owners of Tract AB (or the owners of any

other lot adjacent to Shenandoah Subdivision).

¶ 51 It is of no consequence that the Highlands Plat does not

appear in a title search for Shenandoah Subdivision because the

search would reveal documents in the chain of title for Shenandoah

Subdivision that created the Subject Easement and indicated it and

the other “General Common Elements” benefited adjacent

subdivisions.

23
¶ 52 In sum, we hold that the district court did not err by granting

summary judgment to the Kroesens on their claim for a declaratory

judgment regarding the existence of the Subject Easement.

IV. The Kroesens Are Not Entitled to Recover Lost Profits on Their
Claim for Intentional Interference with Contract

¶ 53 The Kroesens contend that the district court erred by holding

they are not entitled to recover lost profits on their claim for

intentional interference with contract. They argue that the

Colorado Supreme Court has approved an award of lost profits in

cases involving similar facts. See, e.g., Westfield Dev. Co. v. Rifle

Inv. Assocs., 786 P.2d 1112, 1119-20 (Colo. 1990).

¶ 54 The Kroesens ask us to extend the narrow holding of Westfield

Development, which involved property whose value had plummeted

after a proposed sale fell through. They contend that lost profits are

a proper measure of damages in claims involving intentional

interference with a real estate contract, even where the subject real

estate has not become unmerchantable. We decline to do so and

affirm the district court’s decision on the damages awardable to the

Kroesens on their intentional interference claim.

24
A. Standard of Review

¶ 55 A judgment following a bench trial presents a mixed question

of fact and law. Sandstead-Corona v. Sandstead, 2018 CO 26, ¶ 37,

415 P.3d 310, 317. We review the trial court’s factual findings

under a clear error standard, but review its legal conclusions de

novo. Jordan v. Panorama Orthopedics & Spine Ctr., PC, 2013 COA

87, ¶ 13, 350 P.3d 863, 867, aff'd, 2015 CO 24, 346 P.3d 1035.

¶ 56 We also review de novo the trial court’s “application of

governing legal standards,” Morris v. Belfor USA Grp., Inc., 201 P.3d

1253, 1257 (Colo. App. 2008), including “[t]he proper measure of

damages,” Taylor Morrison of Colo., Inc. v. Terracon Consultants, Inc.,

2017 COA 64, ¶ 23, 410 P.3d 767, 772. “However, the fact finder

has the sole prerogative to assess the amount of damages and its

award will not be set aside unless it is manifestly and clearly

erroneous.” Morris, 201 P.3d at 1257.

B. Legal Authority

¶ 57 The standard measure of damages for the breach of a contract

for the sale of real estate is the difference between the contract price

and the fair market value of the property at the time of breach.

Westfield Dev., 786 P.2d at 1120. But intentional interference with

25
contract is a tort. Id. Thus, for such claims, “[t]he measure of

damages may . . . depart from contractual damages when necessary

to make the innocent party whole.” Id. (emphasis added).

¶ 58 “A bedrock goal of tort law is to ‘make the plaintiff whole.’”

LeHouillier v. Gallegos, 2019 CO 8, ¶ 44, 434 P.3d 156, 164. Tort

law disfavors windfall damage awards that put the plaintiff in a

better financial situation than his or her position before the injury.

Id. “[A] plaintiff may not receive double recovery for the same losses

arising from the same injury.” Taylor Morrison, ¶ 27, 410 P.3d at

773.

B. Analysis

¶ 59 The record and legal precedent support the district court’s

determination that the Kroesens are not entitled to recover lost

profits. In Westfield Development, the supreme court held that lost

profit damages are awardable in intentional interference with

contract cases “when necessary to make the innocent party whole.”

786 P.2d at 1120. This rule gives district courts flexibility in

computing damages, so they can fashion remedies that “make the

plaintiff whole” under “unique circumstances.” See LeHouillier,

¶ 44, 434 P.3d at 164; Westfield Dev., 786 P.2d at 1120.

26
¶ 60 We agree with the district court that the facts underlying the

Kroesens’ case differ from those in Westfield Development. In that

case, the supreme court affirmed an award of lost profits because of

“unique circumstances” that rendered the real estate

unmerchantable and a sale at the contract price impossible.

Westfield Dev., 786 P.2d at 1120. The property at issue in Westfield

Development was “unmerchantable” because of the “very limited

number of [potential] buyers”; the defendant had reduced the

number of potential buyers after selling a similar property to the

same entity, which had declined to purchase the subject property;

and, after the plaintiff sought to mitigate its damages by selling the

property, “the bottom fell out of the market,” thereby making a sale

at the contract price impossible. Id.

¶ 61 Westfield Development’s unique circumstances are not present

here. The district court did not award lost profits to the Kroesens

because, as the Kroesens’ expert witness explained, the value of

Tract AB at the time of the trial was “difficult to tell on the evidence

the Court has received,” and an award of lost profits would be

“speculative.” The court noted that the Kroesens planned to sell,

and had already listed, Tract AB at a higher price than the price

27
specified in the terminated contract. The court reasoned that an

award of lost profits to the Kroesens would likely result in a double

recovery.

¶ 62 Instead of lost profits, the court awarded the Kroesens their

cost of maintaining Tract AB for approximately five years

(approximately three years before the judgment and two years

thereafter). Because it had taken the Kroesens approximately five

years to enter into the contract to sell Tract AB and there was no

record evidence of a material decline in the value of their property

or the local real estate market, the record supports the court’s

calculation of damages.

¶ 63 Unlike the property in Westfield Development, as the district

court found, Tract AB still had market value and would likely

eventually be sold. Although it may be unclear when that sale will

occur, the Kroesens will likely recover the loss of their anticipated

profits when they sell the property.

¶ 64 The Kroesens further contend that, in calculating damages,

the district court erred by comparing Tract AB to a nearby lot that

was sold in October 2017. They assert that this error invalidates

the court’s determination that they are not entitled to lost profits

28
because their property has lost value since 2015 and they will be

forced to sell their land for less than the price specified in the

terminated contract.

¶ 65 We do not agree. While the Kroesens’ expert testified that the

comparative tract had “similar views” to, and was “more level” than,

Tract AB, she also testified that, unlike Tract AB, the comparative

lot does not have “half of [a] pond.” Because the expert’s testimony

was unclear as to the comparative value of Tract AB and the other

lot, coupled with the record evidence that Tract AB retained market

value and would eventually sell at or above the contract price

specified in the terminated contract, we perceive no error in the

district court’s measure of damages.

V. Conclusion

¶ 66 The district court’s judgment is affirmed.

JUDGE FOX and JUDGE BERGER concur.

29