author: Judge NEY.

text:
    Jessie AREVALO; Lindsey Griffith; Bill Pemberton; Robert D. Yeager; Lawrence C. Stapleton; Elain Lamm, by her next friend Argentina Stein; Lash L. Jackson; and Kathy Edminston, individually and on behalf of others similarly situated, Plaintiffs-Appellees, v. COLORADO DEPARTMENT OF HUMAN SERVICES and Marva Hammons, in her official capacity as the executive director of the Colorado Department of Human - Services, - Defendants-Appellants.
    No. 01CA0769.
    Colorado Court of Appeals, Div. II.
    May 8, 2003.

      Law Office of Kathleen Mullen, P.C., Kathleen Mullen, Denver, Colorado, for Plaintiffs, Appellees.
    Ken Salazar, Attorney General, Wade S. Livingston, First Assistant Attorney General, Denver, Colorado, for Defendants-Appellants.
   Opinion by

Judge NEY.

Defendants, Colorado Department of Human Services and Marva Hammons, in her official capacity as the Executive Director of the department, appeal several orders of the trial court in favor of the plaintiff class. We dismiss the appeal in part and otherwise affirm.

The history of this class action litigation is set forth in Goebel v. Colorado Department of Institutions, 764 P.2d 785 (Colo.1988), and Goebel v. Colorado Department of Institutions, 830 P.2d 1036 (Colo.1992).

In 1994, the parties entered into a settlement agreement, which was approved by the court. At the same time, the parties prepared a services plan, which detailed the services to be provided to plaintiffs.

In 1997, plaintiffs filed a motion to enforce specific provisions of the settlement agreement and the services plan. The trial court initially concluded that defendants' obligations under the services plan that were not contained in the settlement agreement were not specifically enforceable, and it limited plaintiffs' enforcement action to defendants' obligations contained in the settlement agreement.

Plaintiffs appealed this order, pursuant to a C.R.C.P. 54(b) certification. A division of this court reversed the trial court and held that obligations contained in the services plan were also specifically enforceable. See Arevalo v. City & County of Denver, (Colo. App. No. 98CA0849, July 1, 1999)(not published pursuant to C.A.R. 35(F)).

However, pending that appeal, the trial court retained jurisdiction over the obligations under the settlement agreement that it had concluded were specifically enforceable.

On October 20, 1999, the trial court ordered defendants to specifically perform several obligations required by the settlement agreement, including obligations not raised in plaintiffs' initial motion. The trial court denied defendants' motion to certify this order under C.R.C.P. 54(b) because the ruling did not finally dispose of a single claim for relief and the certification would fracture and complicate the case further.

On March 31, 2001, the trial court, upon plaintiffs' motion, found defendants in contempt for failing to abide by the terms of the October 20, 1999 order. In the same order and in response to the opinion of a division of this court, the trial court ordered defendants to perform the obligations under the services plan that had not been previously considered by the trial court.

Subsequent to the March 31, 2001 order, based on evolving facts, the trial court issued further orders that modify, add, and vacate defendants' responsibilities pursuant to the settlement agreement.

I

Defendants contend the trial court erred in ordering specific performance in both the October 20, 1999 and March 31, 2001 orders. We decline to address this argument because we conclude that these orders are not final and therefore we are without jurisdiction to consider them.

Our jurisdiction is limited to the review of final orders. Section 18-4-102(1), C.R.S. 2002; C.A.R. 1(a).

The parties cannot confer subject matter jurisdiction upon this court by their consent. Sanchez v. Straight Creek Constructors, 41 Colo.App. 19, 580 P2d 827 (1978).

A trial court and an appellate court cannot hold concurrent jurisdiction to determine substantive matters that directly affect the judgment of the trial court. See People v. Dillon, 655 P.2d 841 (Colo.1982).

Accordingly, we must determine whether the trial court's orders of specific performance were final and invest us with jurisdiction to consider their contents, or whether those orders were not final and left the trial court with jurisdiction to modify them. We conclude that the orders of specific performance were not final and that the trial court retained jurisdiction over their substantive contents.

The enforcement proceedings in the trial court are based on the terms of the settlement agreement. The agreement provides that, "if the plaintiffs believe that ... Defendants have failed to substantially perform their obligations ... the plaintiffs may apply to the Court for a hearing to enforce the obligation(s)." It continues:

If, after hearing, the Court finds that ... one or more of defendant(s) have failed to substantially comply, the Court shall issue an Order directing specific performance of the Agreement and, if the Defendant(s) fail(s) to comply with this Order, the Court shall, if appropriate under applicable legal principles, issue an Order of contempt and other Orders within its power for Defendant's failure to substantially comply with the Court's order of specific performance.

Thus, the trial court has, in effect, a continuing supervisory role in the enforcement of the settlement agreement and services plan and, upon plaintiffs' motion, continues to have authority to order further specific performance and modify and vacate previous orders of specific performance.

It is unclear on the face of the settlement agreement whether the parties envisioned this continuous supervisory role for the trial court.

Generally, our interpretation of the terms of a contract is de novo. Harwig v. Downey, 56 P.3d 1220 (Colo.App.2002). However, interpretation of settlement agreements that provide for enforeement by the trial court is not governed by the same standard. Instead, deference should be given to the trial court that approved the settlement agreement in its subsequent construction of its enforcement role. See Halderman v. Pennhurst State School & Hospital, 901 F.2d 311 (3d Cir.1990); see also United States v. Knote, 29 F.3d 1297 (8th Cir.1994).

Thus, because it maintains jurisdiction to modify its enforcement orders and has not certified these orders pursuant to C.R.C.P. 54(b), we conclude that its orders enforcing the obligations under the settlement agreement and services plan are not final.

The parties rely upon Schnier v. District Court, 696 P.2d 264 (Colo.1985), for support of their assertion that the orders of specific performance are reviewable by this court. In Schnier, the supreme court held that the trial court retained jurisdiction to consider a contempt motion brought after a notice of appeal had been filed.

However, we find Schnmier distinguishable on the facts. In Schmier, the trial court's subsequent order did not modify any of the substantive obligations under the earlier order. However, here, the trial court's orders affected the substantive issues presented for review by modifying and vacating certain of defendants' responsibilities. As a result, the parties' responsibilities are in a state of flux subsequent to the filing of the notice of appeal, and, thus, the orders cannot be considered final.

We are cognizant of defendants' contention that this conclusion may prevent the timely appellate review of the trial court's orders. However, the parties' intentions as indicated by the trial court's interpretation of the settlement agreement, and their actions pursuant to the trial court's supervisory role, indicate their consent to this superior function of the trial court in enforcing the agreement. Furthermore, defendants' assertion ignores the point that appellate review of the orders would raise collateral estoppel questions regarding the validity of any subsequent trial court orders interpreting the terms of the settlement agreement. Thus, even if we had jurisdiction, judicial restraint would suggest that we decline to create such disarray and uncertainty.

Accordingly, we conclude that we do not have jurisdiction to review the trial court's interpretation and enforcement of the settlement agreement until the trial court either certifies its particular orders as final pursuant to C.R.C.P. 54(b) or issues an order that outlines the parties' exact responsibilities pursuant to the settlement agreement and services plan and does not allow the court to further modify or vacate these responsibilities. Additionally, it should be noted that onee such a final order is issued or certified by the trial court and the parties appeal that order, any subsequent order concerning the settlement agreement and the services plan by the trial court would be void for lack of jurisdiction, until this court remands the case to the trial court.

IL.

Defendants contend that the trial court's March 31, 2001 order finding the department in contempt is contrary to the evidence. We disagree.

We have jurisdiction to review the contempt portions of the March 81, 2001 order. See C.RC.P. 107(f) ("For the purposes of appeal, an order deciding the issue of con- . tempt and sanctions shall be final.")

The finding of contempt is within the sound discretion of the trial court and will not be reversed on appeal absent an abuse of this discretion. Conway v. Conway, 134 Colo. 79, 299 P.2d 509 (1956); People v. Mulberry, 919 P.2d 835 (Colo.App.1995)

To find a party in contempt for violation of a lawful order of which the party is aware, the trial court must find that: (1) the party did not comply with the order; (2) the party's refusal to comply with the order was willful; and (8) the party had the ability to comply with the order. See In re Boyer, 988 P.2d 625 (Colo.1999). If the contempt order is intended to be remedial in nature, the trial court must find that the party is presently able to comply as well. In re Estate of Elliott, 993 P.2d 474 (Colo.2000).

Here, the trial court found that an order of contempt was proper because the department failed to comply with the October 20, 1999 order of specific performance. Specifically, the trial court found that the department failed to: (1) fill the group homes and congregate apartments with appropriate class members by December 15, 1999; (2) fill the remaining twenty-five units of unused section 8 housing by December 15, 1999; (8) design a comprehensive plan to identify, track, and wait-list board and care and homeless class members by December 15, 1999 and implement such plan with regard to homeless class members; and (4) comply with the staffing requirements. Furthermore, the trial court found that the department both previously and presently had the ability to comply with the order of specific performance and that its actions in not complying were willful.

We conclude that these findings are supported by competent evidence and are not contrary to law. The department admitted in the trial court that: (1) the group homes and congregate apartments were not filled by the deadline; (2) the additional section 8 units were not filled by the deadline; and (8) adequate staffing was not in place by the deadline. . Furthermore, the department's submitted plan and the testimony of, the court-appointed expert supports the conclusion that the department had not complied with the requirement to design and implement a comprehensive plan with regard to homeless class members.

Additionally, the evidence supports the trial court's finding that the department was able to comply with the order. The department contends that the trial court should have assessed only the appropriations received from the General Assembly. We are not persuaded.

The department relies upon State v. Pena, 911 P.2d 48 (Colo.1996), for the proposition that the trial court should not punish the department for not complying with the trial court's order because the General Assembly did not appropriate money for these purposes. In State v. Pena, the supreme court held that the executive director of the Department of Corrections could not be held in contempt for failing to accept custody of prisoners pursuant to a court order if there was no space for those prisoners.

However, we do not read State v. Pena as narrowly as suggested by the department. Instead, we read that opinion as a reiteration of the well-established requirement that the trial court must make a finding, based on competent evidence, that the contemnor has the ability to comply with the court order. See In re Boyer, supra; see also In re Marriage of Zebedee, 778 P.2d 694 (Colo.App.1988); In re Marriage of Harris, 670 P.2d 446 (Colo.App.1983).

Here, the trial court concluded that the department had the past and present ability to comply with the order. Based on the testimony of several department executives, the trial court concluded that the department did not make a good faith effort to either secure all available necessary funding, attempt to raise additional funding as required by the settlement agreement, or reallocate existing resources to comply with this settlement agreement. The trial court concluded that the department could have complied with this order if it had made these good faith efforts. Accordingly, the trial court's findings that the department had the ability to comply with the order were supported by competent evidence.

Finally, the evidence supports the conclusion that defendants' actions were willful. Based on the executives' testimony, the trial court reasonably found that the department intentionally failed to take the required actions under the order.

Accordingly, we conclude that the trial court did not abuse its discretion in holding the department in contempt. The appeal as to the October 20, 1999 and March 31, 2001 specific performance orders is dismissed. The March 31, 2001 contempt order is affirmed.

Judge MARQUEZ and Judge CARPARELLI concur.


source: Caselaw Access Project

author: Judge GRAHAM.

license: Public Domain

text:
    Mark John PETERSON, Plaintiff-Appellant, v. ARAPAHOE COUNTY SHERIFF, Board of County Commissioners of the County of Arapahoe, County of Arapahoe, and Does 1-4, Defendants-Appellees.
    No. 01CA1859.
    Colorado Court of Appeals, Div. I.
    May 8, 2003.

      Mark John Peterson, Pro Se.
    Kathryn L. Schroeder, County Attorney, Timothy J. Knapp, Assistant County Attorney, L. Cary Unkelbach, Assistant County Attorney, Littleton, Colorado, for Defendants-Appelliees.

       Sitting by assignment of the Chief Justice under provisions of Colo. Const. art. VI, § 5(3), and § 24-51-1105, C.R.S.2002.

   Opinion by

Judge GRAHAM.

Plaintiff, Mark John Peterson, appeals the judgment dismissing his complaint against defendants, the Arapahoe County Sheriff, the Board of County Commissioners of the County of Arapahoe, the County of Arapahoe, and Does 1-4. We affirm in part, reverse in part, and remand.

In his complaint, plaintiff alleged that on March 17, 2000, he was apprehended by agents of a bail bonding company whom plaintiff refers to as bounty hunters; the bounty hunters assaulted and battered him and eventually took him to the Arapahoe County Jail; the deputies refused to take him into custody because of his poor medical condition caused by the beatings; he told the deputies that he was afraid he would suffer additional beatings from the bounty hunters if he were not admitted to the jail; when custody was refused, the bounty hunters continued to beat him; and eventually, he was taken into custody at another jail and transported to the hospital, where he was admitted to the intensive care unit.

Plaintiff initially brought this action against the Arapahoe County Sheriff, the County of Arapahoe, and Does 1-4. Plaintiff asserted five claims for relief: (1) the deputies failed to take him into protective custody; (2) the Arapahoe County Sheriff and the County of Arapahoe failed to train or supervise the deputies adequately; (8) the Arapahoe County Sheriffs and the County of Arapahoe's policy and practice of refusing to accept custody of a person because of the person's medical condition violated plaintiff's constitutional rights; (4) defendants' actions violated plaintiff's rights, privileges, and immunities as guaranteed by the First, Fourth, Fifth, Ninth, Tenth, and Fourteenth Amendments of the United States Constitution; and (5) defendants acted willfully and wantonly in refusing to accept him into custody.

Defendants moved to dismiss plaintiff's complaint. Defendants argued that plaintiff's state law tort claims were barred because plaintiff failed to provide the notice of claim required by § 24-10-109, C.R.S8.2002, of the Colorado Governmental Immunity Act (GIA). Defendants filed affidavits supporting the lack of notice. Additionally, defendants argued that plaintiff's first, second, and third claims for relief should be dismissed because immunity is not waived under the GIA for those claims.

Defendants also argued that plaintiff had failed to set forth specific facts supporting willfal and wanton conduct and that Arapahoe County cannot be liable for the conduct of a deputy sheriff.

Defendants further argued that plaintiff had failed to plead a claim against the sheriff individually because the complaint did not list any specific actions personally taken by the sheriff that violated plaintiff's constitutional rights. Defendants asserted that plaintiff failed to plead an official capacity claim and that such a claim may not be maintained against the sheriff in his official capacity or Arapahoe County as a public entity. Finally, defendants argued that under § 1988 the sheriff or Arapahoe County may not liable in a supervising capacity on a theory of respon-deat superior.

In his amended complaint, plaintiff listed the board of county commissioners as a defendant. His supporting affidavit stated that he had mailed a notice of claim to the Arapahoe County Attorney on July 6, 2000, and that he gave a statement about the incident to an Arapahoe County deputy sheriff on August 28, 2000. Plaintiff asserted that defendants' failure to take him into custody to avoid incurring medical expenses, knowing that he had been beaten by the bounty hunters, constituted willful and wanton conduct. As to the § 1983 claims, he stated that defendants acted under color of law, that a special relationship existed between him and defendants such that defendants had an obligation to protect him from harm, and that defendants increased his vulnerability to harm.

Defendants then renewed their motion to dismiss, which the trial court summarily granted.

I. Arapahoe County

We first conclude that the claims against the county were properly dismissed.

Based on the decision in Tunget v. Board of County Commissioners, 992 P.2d 650 (Colo.App.1999), the Arapahoe County Sheriffs Department and Arapahoe County are considered separate public entities for purposes of the GIA. In Tunget, supra, 992 P.2d at 652, a division of this court recognized that "Itlhe sheriff, not the county or the Board, has the right of control with respect to deputies" Thus, the sheriff is the appropriate governing entity to deal with a claim against a deputy sheriff. In accordance with statutory provisions, the sheriff may recover judgment against his or her sureties. Section 30-10-519 C.R.S., 2002.

Here, the sheriff, but not the county or the board of county commissioners could be liable for the claims against the deputies, and the trial court therefore properly dismissed the claims against Arapahoe County.

IL - State Law Claims

Plaintiff contends that the trial court erred in dismissing his state law claims against the remaining defendants. We agree.

A. GIA Notice

We conclude that further proceedings are necessary to determine whether plaintiff gave adequate notice under GIA.

A motion to dismiss under the GIA involves the trial court's subject matter jurisdiction to hear an action, and it is properly resolved pursuant to C.R.C.P. 12(b)(1). See Walton v. State, 968 P.2d 636 (Colo.1998). Under C.R.C.P. 12(b)(1), the trial court is the fact finder and may hold an evidentiary hearing to resolve any factual dispute upon which the existence of its subject matter jurisdiction under the GIA may turn. See Fogg v. Macaluso, 892 P.2d 271 (Colo.1995); Trinity Broad of Denver, Inc. v. City of Westminster, 848 P.2d 916 (Colo.1998).

Section 24-10-109(1), C.R.S.2002, establishes as a jurisdictional prerequisite that any person seeking damages from a public entity or employee thereof must provide written notice within 180 days of discovering the injury that is the basis of the claim. See Mesa County Valley Sch. Dist. No. 51 v. Kelsey, 8 P.3d 1200 (Colo.2000).

Whether a claimant has satisfied the requirements of § 24-10-109(1) presents a mixed question of law and fact. See Trinity Broad of Denver, Inc. v. City of Westminster, supra. We will defer to the trial court's findings of fact unless they are clearly erroneous. Swieckowski v. City of Fort Collins, 934 P.2d 1380 (Colo.1997).

In response to defendants' motion to dismiss, plaintiff submitted a copy of a letter he claims he sent by regular mail to the Arapahoe County Attorney on July 6, 2000. The last page of the letter indicates that a copy was provided to the Arapahoe County Sheriff. That letter apparently was mailed within the 180-day period as required by § 24-10-109(1), was addressed to the proper parties as required by § 24-10-109(8), C.R.S.2002, and set forth in narrative form some of the information required by § 24-10-109(2), C.R.98.2002.

However, because the letter was not sent by registered mail, plaintiff is not entitled to a presumption that the effective date of service is the date of mailing. See Reg'l Transp. Dist. v. Lopez, 916 P.2d 1187 (Colo.1996)(although nothing in the statute precludes service by regular mail, the plain terms of the statute do not provide that posting a notice by regular mail is a valid method of establishing the effective date of service). Further, the trial court did not make findings as to whether either the Arapahoe County Attorney or the Arapahoe County Sheriff received the letter prior to the expiration of the 180-day period.

The record also reflects that plaintiff executed a written statement before a sheriff's deputy on August 28, 2000, which was also within the 180-day period. The statement contains information similar to that contained in the July 6, 2000, letter. However, there is no indication that the statement was provided to the sheriff or to the Arapahoe County Attorney.

Accordingly, because of the lack of findings on this issue, we are unable to determine whether plaintiff timely provided a notice of claim and whether the trial court properly dismissed plaintiff's state law claims based on his failure to comply with the requirements of § 24-10-1109. Therefore, we are unable to affirm the trial court's dismissal of plaintiff's state law claims on this basis. On remand, the trial court must make further factual findings to determine the threshold question of jurisdiction.

B. Willfal and Wanton Conduct

It is not clear whether the trial court dismissed the claims for willful and wanton conduct because of an untimely notice or because of failure to state a claim as a matter of law. Because this issue may arise on remand, we address the substantive aspects of the claims. We conclude that plaintiff alleged sufficient facts to state a claim against the sheriff and the presently unknown deputies for willful and wanton conduct.

In any action alleging willful and wanton conduct of a public employee, the specific factual basis of such allegations shall be stated in the complaint. Section 24-10-110(5)(a), C.R.9.2002. The failure to plead the factual basis shall result in dismissal of the claim for failure to state a claim upon which relief can be granted. See § 24-10-110(5)(b), C.R.S. 2002.

Sheriffs and their sureties are responsible for the misconduct of their deputies. Section 30-10-506, C.R.S.2002; Tunget v. Bd. of County Comm'rs, supra. Thus, in Colorado, sheriffs are made liable for the torts of their deputies.

Although the phrase "willful and wanton" is not defined in the GIA, in Moody v. Ungerer, 885 P.2d 200 (Colo.1994), the supreme court analyzed several different definitions, all of which "involved an element of conscious disregard for the safety of others." Jarvis v. Deyoe, 892 P.2d 398, 401 (Colo.App.1994).

Plaintiff's amended complaint asserted that, despite his pleas to the deputies for help, they purposefully ignored his condition and obvious dilemma. His pro se pleading alleges that "upon seeing [his] physical condition," the deputies "knowingly and intentionally refused to accept ... custody ... while knowing ... that ... the beatings would continue." Plaintiff also implicated the sheriff by alleging that he was "charged with the responsibility of ... supervising ... all ... deputies." Plaintiff further asserts that the sheriff "failed to prevent the wrongful acts of his deputies." These allegations were sufficient to plead a claim based upon willful and wanton conduct against the deputies and, by operation of the statutorily imposed respon-deat superior liability, against the sheriff. See Davis v. Paolino, 21 P.3d 870 (Colo.App.2001)(allegations that guard had spilled coffee and juice on the floor and that he intended someone to be injured by it, as shown by its presence for over two hours, was sufficient to plead a claim for willful and wanton conduct).

III. Section 1983 Claims

Plaintiff contends that the trial court erred in dismissing his 42 U.S.C. § 1983 claims. We agree.

Section 1983 authorizes suits to redress deprivations of "any rights, privileges, or immunities secured by the Constitution and laws." Henderson v. Gunther, 931 P.2d 1150, 1154 (Colo.1997). To state a claim for relief under $ 1988, a plaintiff need allege only that: (1) the defendant acted under color of state law; and (2) the defendant's conduct deprived the plaintiff of certain federal rights. See State v. Nieto, 993 P.2d 498 (Colo.2000).

In this case, plaintiff alleged that defendants violated his rights, privileges, and immunities as guaranteed by the First, Fourth, Fifth, Ninth, Tenth, and Fourteenth Amendments of the United States Constitution. Under the circumstances presented here, we interpret plaintiff's claim as alleging that defendants violated his right to substantive due process.

The purpose of the Due Process Clause is "to protect the people from the State, not to ensure that the State protect[s] them from each other." DeShaney v. Winnebago County Dep't of Soc. Servs., 489 U.S. 189, 196, 109 S.Ct. 998, 10083, 108 LEd.2d 249, 259 (1989); Duong v. County of Arapahoe, 837 P.2d 226 (Colo.App.1992). Thus, the general rule is that state actors are liable under the Due Process Clause only for their own acts and not for the violent acts of third parties. Henderson v. Gunther, supra.

In certain limited cireumstances, however, the state has been found to have an affirmative duty to protect citizens from constitutional injury inflicted by a private person. Those cireumstances have been framed as two exceptions to the general rule: (1) the special relationship exception; and (2) the danger creation exception. v. Gunther, supra.

The special relationship exeeption provides that in custodial or other settings in which the state has limited individuals' ability to care for themselves, the state has a constitutional obligation to protect them from being harmed by third parties. DeShaney v. Win-mebago County Dep't of Soc. Servs., supro; Jarvis v. Deyoe, swpra.

Here, the allegations of plaintiff's complaint established that he was not taken into custody by defendants. Thus, contrary to plaintiff's contention, a special relationship did not exist that would have constitutionally obligated defendants to protect him from harm. See Jarvis v. Deyoe, supra.

The danger creation exception provides that the state may be constitutionally obligated for failing to protect a person from harm, even in a noncustodial setting, when the state itself affirmatively created or enhanced the risk of harm. See Henderson v. Gunther, swpra (listing cases in which danger creation exception would apply); Jarvis v. Deyoe, supra (citing various examples from other jurisdictions in which police officers may have violated due process by creating or enhance-ing a danger to the plaintiff).

However, the state actors must do more than merely create an environment in which harm occurs. Rather, the state actors must abuse their governmental power by subjecting a person to harm that would not have occurred in the absence of the state actor's conduct. Henderson v. Gunther, supra.

We conclude that defendants' failure to take plaintiff into custody may have offended a constitutional duty to protect. We note, for example, that a warrant to arrest had been issued, and this implicates an affirmative responsibility to take defendant into custody, which may be admissible in proving exacerbation and willful and wanton conduct. Cases finding no liability suggest that claims may exist if the government representative made the victim's situation worse. CJ De-Shaney v. Winnebago County Dept of Soc. Servs., supra (no § 1988 liability even though defendants knew firsthand of the threat to the boy's safety, yet they failed to remove him from his father's custody or otherwise protect him from abuse); Henderson v. Gunther, supra (holding that danger creation exception did not apply in attack by inmate against prison employee in the absence of allegations that the defendants intentionally provided the inmate with a weapon or encouraged the attack in any way); see also Windle v. City of Marion, 321 F.3d 658 (7th Cir.2003)(police officer's failure to timely intervene to protect student from molestation of which that officer was aware did not violate student's due process rights under Fourteenth Amendment; police officer did nothing to create the danger or make worse any danger the student already faced); Jones v. City of Philadelphia, 185 F.Supp.2d 413 (E.D.Pa.2001)(police directing traffic at outdoor party did not violate the substantive due process rights of an assault victim when they allegedly made no response to her calls for help).

Here, the allegations of the complaint suggest that unknown deputies exacerbated his plight and increased his vulnerability to harm by failing to take him into custody under an outstanding warrant. Under these cireum-stances, the claim, absent further factual development, withstands a bare motion to dismiss for failure to state a claim.

The judgment is affirmed as to the dismissal of plaintiff's claims against Arapahoe

County and its board of commissioners. The judgment is reversed as to the dismissal of plaintiff's state law claims based upon failure to provide notice and the § 1988 claims against the individual deputies and the sheriff. The case is remanded to the trial court for further proceedings as needed to determine jurisdictional issues and the § 1983 claims. If it is determined that plaintiff gave timely notice, the state law claims shall be reinstated. Plaintiff also should be allowed the opportunity to obtain discovery, including the identity of the individual deputies.

Judge VOGT and Judge METZGER concur.


author: Chief Judge DAVIDSON.

text:
    Perry VENARD, Complainant-Appellant, v. DEPARTMENT OF CORRECTIONS, Arkansas Valley Correctional Facility, Respondent-Appellee, and Colorado State Personnel Board, Appellee.
    No. 01CA2065.
    Colorado Court of Appeals, Div. III.
    May 8, 2003.

      Frank & Finger, P.C., William S. Finger, Evergreen, Colorado, for Complainant-Appellant.
    Ken Salazar, Attorney General, Monica Ramunda, Assistant Attorney General, Vincent R. White, Assistant Attorney General, Denver, Colorado, for Respondent-Appellee.
    Ken Salazar, Attorney General, Denise Deforest, Assistant Attorney General, Denver, Colorado, for Appellee.
   Opinion by

Chief Judge DAVIDSON.

Pursuant to § 24-50-125.4(8), C.R.S.2002, complainant, Perry Venard, appeals from the order of the Colorado State Personnel Board upholding his termination from employment. We vacate the order and remand for further proceedings.

Complainant's employment was terminated by the Colorado Department of Corrections (DOC) following the escape of three inmates from the Arkansas Valley Correctional Facility (AVCF). Complainant was hired by the DOC as a Correctional Support Supervisor II at the AVCF, where he supervised an inmate work crew. Complainant was in charge of the tools used at the facility and was responsible for marking and inventorying new tools, including Class A tools which could be used as a weapon or in an escape.

In February 1998, complainant received and inventoried fifteen new lineman pliers, which were classified as Class A tools. Complainant kept twelve of the lineman pliers in his desk drawer and put the remaining three in the tool locker located in the men's bathroom. The computer inventory showed that all fifteen of the pliers were located in the tool locker.

In September 1999, complainant was promoted to Correctional Support Supervisor III. He supervised the HVAC and plumbing staff but, according to the DOC, remained responsible for his previous duties, including tool control, until a replacement was hired.

In December 1999, three inmates escaped from the AVCF by cutting a hole in the fence surrounding the facility. A pair of lineman pliers that had been marked and inventoried by complainant in February 1998 was found on the ground where the escapees had cut through the fence.

Upon checking the tool locker and discovering that no tools were missing, complainant informed his supervisor that the pliers had likely come from his desk. The supervisor subsequently reported that information to the warden. Complainant was instructed by the warden to write an incident report, in which he stated the following: "Two pair of lineman pliers ... are missing from the physical plant. Both pliers were unissued replacement pliers." The warden was not satisfied with this report and asked complainant to write a more detailed incident report. In response, complainant composed a second report that read: "The two pair of pliers missing from the physical plant are missing from the staff bathroom, tool locker 5. They are pliers that were not yet issued. They were last inventoried in July of 1999. It is unknown to me how they could have left the locker."

Following an investigation, the warden terminated complainant's employment for failing to comply with certain administrative regulations by writing and submitting two false incident reports, for violating the staff code of conduct by keeping tools in his desk, and for intentionally assisting the inmates in escaping from the AVCF.

Complainant filed a timely appeal with the board. After a hearing, an administrative law judge (ALJ) upheld the termination and duly filed the record with the board. However, because of mechanical problems, one day of the hearing, which included the testimony of the warden, inadvertently was not transcribed. Asserting that the record was so incomplete that it did not permit meaningful review, complainant filed a motion to supplement and a motion for new hearing or remand and the taking of supplemental testimony. The board denied each of complainant's motions. - Subsequently, complainant filed a motion for disqualification of one of the members of the board, which the board also denied.

I.

On appeal, complainant makes the following assertions: (1) the board acted arbitrarily and capriciously and violated his due process rights in ruling that an incomplete record of the proceedings was adequate for purposes of review; (2) based on the record available to the board, there was insufficient evidence to support its order affirming complainant's termination; (3) the sanction of termination from employment was manifestly exeessive in relation to the offense charged; (4) the board member's role as special assistant attorney general in Gerganoff v. Department of Personmel in the Denver District Court was in direct violation of Colo. Const. art. XII, § 14(1), which mandates that a board member shall not be an officer or employee of the state; and (5) the board member's position as a direct adversary of complainant's counsel in the Gerganoff matter created an appearance of impropriety that mandated her disqualification.

We agree with complainant's assertion that, under the cireumstances here, the board member's dual role as special assistant attorney general in the Gerganmoff matter, while at the same time a member of the board in this case, created an appearance of impropriety. Thus, we remand this matter to the board for further proceedings. Because the board is to reconsider complainant's other contentions on remand, we do not address them here.

IL

We agree with complainant that the board's denial of his motion to disqualify the board member from these proceedings was improper.

A reviewing court may reverse an administrative agency's decision if the agency made a decision not supported by the record or erroneously interpreted the law. See Lawley v. Dep't of Higher Educ., 36 P.3d 1239 (Colo.2001).

Administrative agencies are obligated, as are courts, "to be fundamentally fair to the individual in the resolution of a legal dispute involving governmental action that threatens to deprive an individual of a significant property interest." deKoevend v. Bd. of Educ., 688 P.2d 219, 227 (Colo.1984).

Absent a personal, financial, or official stake in the outcome evidencing a conflict of interest on the part of the decision-maker, an adjudicatory hearing is presumed to be impartial. However, this presumption is rebuttable. Mountain States Tel & Tel. Co. v. Pub. Utils Comm'n, 763 P.2d 1020 (Colo.1988); Soon Yee Scott v. City of Englewood, 672 P.2d 225 (Colo.App.1988). Moreover, the decisionmaker must be neutral and detached. See deKoevend v. Bd. of Educ., supra.

When, as here, an administrative proceeding is quasi-judicial in character, board members should be treated as the equivalent of judges. See Wells v. Del Norte Sch. Dist. C-7, 758 P.2d 770 (Colo.App.1987).

CRCP. 97 provides that a judge shall be disqualified in a case in which she is interested or prejudiced or "is so related or connected with any party or his attorney as to render it improper for [her] to sit on the proceeding." - Additionally, a judge should avoid "impropriety and the appearance of impropriety in all [her] activities," C.J.C. Canon 2, and should "disqualify [herself] in a proceeding in which [her] impartiality might reasonably be questioned," C.J.C. Canon 3(C)(1). See also Smith v. Beckman, 683 P.2d 1214 (Colo.App.1984). Even though the judge or board member may be convinced of his or her own impartiality, it is the duty of the tribunal to eliminate all reasonable doubt that a trial or hearing by a fair and impartial council may have been denied. See Zolime v. Telluride Lodge Ass'n, 732 P.2d 635 (Colo.1987).

If counsel for a party files a motion to disqualify and signs a verified affidavit alleging conduct on the part of the tribunal that, if true, evidences bias, prejudice, or the appearance thereof, it is an abuse of discretion for the tribunal to refuse to withdraw from the case. See Johnson v. Dist. Court, 674 P.2d 952 (Colo.1984). The motion and affidavit are legally sufficient if they " 'state facts from which it may reasonably be inferred that the judge has a bias or prejudice that will prevent [her] from dealing fairly' with the party seeking recusal." Johnson v. Dist. Court, supra, 674 P.2d at 956 (quoting People v. Botham, 629 P.2d 589, 595 (Colo.1981)); see also Goebel v. Benton, 830 P.2d 995 (Colo.1992)(mere allegations, opinions, or conclusions unsubstantiated by facts are not legally sufficient to mandate disqualification).

Here, complainant's counsel filed a motion for disqualification and a verified affidavit stating that the board member sitting as a decisionmaker in complainant's case while serving as adversary counsel to complainant's counsel in the Gerganoff matter created an appearance of impropriety sufficient to cast doubt on the impartiality of her decisions. Complainant's counsel also asserted that the board member's participation in this matter prejudiced complainant because her vote was the deciding vote on the board's rulings to deny his motion to supplement and to remand to the ALJ for a new hearing. We agree that under these circumstances, disqualification was required.

First, while a member of the board, the board member acted as counsel for the state in the Gerganoff case, representing the director of the Department of Personnel. Even if we assume that this representation in and of itself would not constitute a disqualification from service as a board member, see Colo. Const. art. XII, § 14(1) (board member shall not be officer or employee of the state), because the Gerganoff case is, as here, a personnel matter, at best, her participation in both cases is discomforting.

We are compelled to conclude that this situation extends beyond mere awkwardness to an appearance of impropriety, however, because the board member served as a direct adversary to complainant's counsel in the Gerganoff matter at the same time that she was sitting as a decisionmaker in complainant's case. We agree with complainant that, under these circumstances, the board member's impartiality as a member of the tribunal deciding complainant's case could reasonably be called into question by the adversarial nature of her role as special assistant attorney general in a case in which complainant's counsel was her direct opponent. CL. Pierce v. United Bank, 780 P.2d 6 (Colo.App.1989)(Gjudge's close personal friendship with senior bank officer created appearance of impropriety); Wells v. Del Norte Sch. Dist. C#, supra (hearing officer sitting at same restaurant table as school board counsel and witness created an appearance of impropriety).

Thus, we conclude that the context and manner in which the board member was connected with complainant's counsel created an appearance of impropriety, and consequently, it was an abuse of discretion for the board to allow her to sit in this case.

TIL

Respondent contends, and the board determined, however, that regardless whether there was an appearance of impropriety requiring _ disqualification, complainant waived his right to request the board member's recusal by failing to raise the issue in a timely manner. We disagree.

The statutory procedures for disqualification of an administrative adjudicator, as set forth in § 24-4-105(8), C.R.S.2002, require that a party filing a motion for disqualification must do so in a timely manner and provide sufficient evidence of personal bias. Neither this statute nor C.R.C.P. 97, which governs motions for a change of judge, sets forth a specific time within which a motion for disqualification must be filed.

However, if a party knows of grounds for disqualification when an action is filed, a motion to disqualify should be filed prior to taking any other steps in the case. Aaberg v. Dist. Court, 136 Colo. 525, 319 P.2d 491 (1957). Whether a motion is untimely and constitutes waiver depends upon the facts and cireumstances in each case. Johnson v. Dist. Court, supra.

Waiver is "the intentional relinquishment of a known right or privilege." Waiver may be express, or it may be implied when a party's actions manifest an intent to relinquish a right or privilege. However, in establishing implied waiver by conduct, "the conduct itself should be free from ambiguity and clearly manifest the intention not to assert the benefit." Dept of Health v. Donahue, 690 P.2d 243, 247 (Colo.1984).

Here, solely from the written record, the board determined that complainant's motion was untimely and constituted waiver. In making this determination, the board relied on the following uncontroverted facts: (1) the board member was appointed as a special assistant attorney general in the Gerganoff matter in May 2000; (2) the board member was elected in October 2000; (8) this matter came before the board in December 2000; and (4) complainant did not file a motion for disqualification until June 2001.

However, we discern no waiver merely from the timing of complainant's motion to disqualify. The record shows that until the issuance of the March 22, 2001 board order denying complainant's motion for a new hearing, all of complainant's correspondence came from either the ALJ or the assistant attorney general assigned to the matter. Additionally, the board member's name appears, along with the other board members' names, for the first time in the March 22 order. Although complainant continued to file routine motions with the board after the March 22 order, he received no rulings on these issues until May 15, 2001. And, in the May 15 order, in which the board denied complainant's motion to supplement the record, the board member's name appears twice and is noticeably separate from the other board members' names. Complainant filed the motion to disqualify within three weeks after the issuance of the May 15 order. See Johnson v. Dist. Court, supra (two-month delay in filing motion for disqualification does not constitute waiver); of Estep v. Hardeman, 705 P.2d 523, 527 n. 6 (Colo.1985)(when a motion for disqualification is not filed within ten-day period allowed under Crim. P. 21(b), standard for its timeliness is "whether the application is made as soon as possible after the occurrence or discovery of the facts which form the basis for the motion for substitution" (quoting People v. Botham, supra, 629 P.2d at 595)).

We conclude that the record is insufficient to support the board's conclusion that complainant's counsel intentionally delayed filing. Although failure to assert known grounds for disqualification may constitute a waiver, Ac-berg v. Dist. Court, supra, here, the record is, at best, inconclusive as to whether complainant knew that the board member was a member of the board before the May 15, 2001 order was issued.

Thus, absent unequivocal evidence of an intent to waive his right to raise the issue of disqualification, it was an abuse of discretion for the board to conclude that complainant relinquished this right. CL Welch v. George, 19 P.3d 675, 677 n. 2 (Colo.2000)(settlement language does not "evidence a clear manifestation of intent by [the plaintiff] to waive his right to raise defenses available"); Dep't of Health v. Donahue, supra, 690 P.2d at 247 (employee's delay in raising the claim was "not the type of conduct that clearly manifested any intent to relinquish her claim").

Accordingly, we vacate the board's order and remand for reconsideration, without participation by the board member, of complainant's appeal, including his motion for a new hearing based on the absence of a record or, alternatively, to supplement the record.

The order is vacated, and the case is remanded to the board for proceedings in accordance with this opinion.

Judge ROY and Judge WEBB concur.


author: Judge KAPELKE.

text:
    HORNE ENGINEERING SERVICES, INC., Plaintiff-Appellant, v. KAISER-HILL COMPANY, LLC, Defendant-Appellee.
    No. 02CA0615.
    Colorado Court of Appeals, Div. IV.
    May 8, 2003.

      Judith Ward Mattox, Colorado Springs, Colorado, for Plaintiff-Appellant.
    Rothgerber Johnson & Lyons LLP, Gilbert M. Roman, S. Kato Crews, Denver, Colorado, for Defendant-Appellee.
   Opinion by

Judge KAPELKE.

In this breach of contract action, plaintiff, Horne Engineering Services, Inc., appeals the summary judgment entered by the trial court for defendant, Kaiser-Hill Company, LLC. We affirm.

Horne entered into a contract with Kaiser, Hill to provide services as a subcontractor in support of Kaiser-Hill's role as contractor for the Department of Energy at the Rocky Flats Environmental Technology Site. The contract stated that the period of performance "shall be [the] date of award through June 30, 2000 with the following options" and listed six option periods.

In March 2001, Kaiser-Hill notified Horne it would not be exercising its second option to extend the contract term and that the contract would therefore terminate on September 30, 2001. - Kaiser-Hill simultaneously issued a request for proposals from prospective subcontractors, including Horne.

Horne thereafter filed this action, seeking a declaration of its rights under the subcontract and an award of damages for alleged anticipatory breach of contract and improper interference with its employees. In its complaint, Horne alleged that the contract would not expire until September 80, 2006, the end of the last option period.

Kaiser-Hill moved to dismiss, arguing that the contract expired at the end of the first option period. In support of its motion, Kaiser-Hill submitted an affidavit and portions of the contract. In responding to the motion, Horne also submitted portions of the subcontract, as well as additional documents.

Because the parties had submitted materials outside the pleadings, the trial court treated the motion as one for summary judgment. The court granted the motion and entered a summary judgment of dismissal, concluding that no genuine issues of material fact existed and that, by its unambiguous terms, the contract had expired. The court further determined that the contract did not limit Kaiser-Hill's right to extend the term of the contract or prohibit Kaiser-Hill from soliciting new proposals for services to be performed after expiration of the term.

L.

Horne initially contends that the trial court erred in converting the motion to dismiss to one for summary judgment without providing adequate notice. We perceive no basis for reversal.

C.R.C.P. 12(b) provides that if, on a motion to dismiss for failure to state a claim, "matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56" {emphasis added). See Cheyenne Mountain School District No. 12 v. Thompson, 861 P.2d 711 (Colo.1993); Willer v. City of Thornton, 817 P.2d 514 (Colo.1991).

When a court converts a motion to dismiss for failure to state a claim to one for summary judgment, "(ilt is important that the court give the parties notice of the changed status of the motion and a 'reasonable opportunity to present all material made pertinent to such a motion by Rule 56" In this way no one will be taken by surprise by the conversion." 5A Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1366 at 501-02 (2d ed.1990).

Nevertheless, when, as here, both parties submit material beyond the pleadings in support of or opposing a motion to dismiss, "the prior action on the part of the parties puts them on notice that the judge may treat the motion as a Rule 56 motion." Wheeler v. Main Hurdman, 825 F.2d 257, 260 (10th Cir.1987); see also Collier v. City of Chicopee, 158 F.3d 601, 603 (Ist Cir.1998)(a plaintiff who incorporates materials outside the pleadings into an opposition to a Fed. R.Civ.P. 12(b)(6) motion to dismiss "implicitly conversion ... [and] searcely can be heard to complain when the trial court accepts the invitation"); San Pedro Hotel Co. v. City of Los Amgeles, 159 F.3d 470 (9th Cir.1998); of US West, Inc. v. Business Discount Plan, Inc., 196 F.R.D. 576 (D.Colo.2000)(reaching same conclusion with respect to conversion of motion for judgment on the pleadings to one for summary judgment).

Here, both parties submitted materials outside the pleadings, and the court considered those materials. - Therefore, under these cireumstances, we conclude that Horne was adequately put on notice that the trial court might treat the motion to dismiss as one for judgment.

Further, while Horne argues that it did not have an opportunity to conduct discovery, even on appeal it has not shown what discovery it would have conducted or what effect, if any, the resulting information could have had on the court's ruling.

Accordingly, we find no error.

IL

Horne next contends that the trial court erred in ruling that the contract terminated at the end of the first extended option period. We disagree.

Summary judgment is a drastic remedy that is appropriate only if there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. In reviewing a summary judgment ruling, we give the nonmoving party the benefit of all favorable inferences that may reasonably be drawn from the undisputed facts and resolve all doubts as to whether an issue of fact exists against the moving party. Mancuso v. United Bank, 818 P2d 782 (Colo.1991). Onee a moving party meets its initial burden of demonstrating an absence of issues of material fact, however, the nonmoving party must show, through affidavit or other supporting materials, specific facts creating a genuine issue for trial. Sullivan v. Davis, 172 Colo. 490, 474 P.2d 218 (1970).

In reviewing a ruling in a breach of contract action under Colorado law, our primary obligation is to effectuate the intent of the parties to the contract. Ad Two, Inc. v. City & County of Denver, 9 P.3d 378 (Colo. 2000).

An unambiguous contract must be enforced in accordance with the plain and ordinary meaning of its terms. USI Properties East, Inc. v. Simpson, 938 P.2d 168 (Colo.1997). A contract is ambiguous only if it is reasonably susceptible of more than one meaning. Whether a contract is ambiguous is an issue of law, and reviewing courts thus are not bound by the trial court's determination. Cheyenne Mountain School District No. 12 v. Thompson, supra.

Here, the contract provided in relevant part as follows:

F2 Term of Subcontract
The Period of Performance of this Subcontract shall be date of award through June 30, 2000 with the following options:
Option Period 1--July 1, 2000 through September 80, 2001
Option 2-October 1, 2001 through September 30, 2002
Option 3-October 1, 2002 through September 30, 2008
Option 4-October 1, 2008 through September 30, 2004
Option 5-October 1, 2004 through September 30, 2005
Option 6-October 1, 2005 through September 30, 2006
F.3 Options to the Subcontract
Option(s) to extend the term of the Subcontract or increase/decrease quantities, if any, are identified in Section B. In the event the Option(s) are implemented, the following provisions shall apply:
(a) Contractor may extend the term or increase/decrease this Subcontract by written notice to the Subcontractor provided that the Contractor shall give the Subcontractor a preliminary written notice of its intent to do so at least 10 days before the Subcontract expires in accordance with the terms of the Subcontract.
(b) If the Contractor exercises this option, the extended or changed Subcontract shall be considered to include this option clause.

Both parties have taken the position that the contract is unambiguous, and the trial court so ruled. We agree. Under the plain language of the contract, the term of the contract was from the date of award to June 30, 2000. While the contract gave Kaiser, Hill the unrestricted option to extend the term for additional periods, if it elected not to exercise its option, the contract would terminate at the expiration of the original term. If it elected to extend for one or more of the option periods, the contract would terminate at the end of the last period for which it exercised that option.

In March 2001, Kaiser-Hill notified Horne of its decision not to exercise its option to extend the contract for any additional periods. Accordingly, by its terms, the contract terminated as of September 30, 2001.

Finally, we reject Horne's contention that Kaiser-Hill was not free to solicit new bids for the subcontract work for periods after September 30, 2001, or to alter the nature or seope of work to be performed under the subcontract that was to be the subject of the new request for proposals As discussed, after that date, Kaiser-Hill had no further obligation to retain Horne to perform the subcontract work. Thus, Kaiser-Hill had the right to submit requests for proposals to others for work to be performed on the project after September 30, 2001. We therefore conclude that the trial court properly entered summary judgment for Kaiser-Hill.

The judgment is affirmed.

Judge ROTHENBERG and Judge DAILEY concur.


text:
    Ronald T. GENOVA, M.D., Plaintiff-Appellant, v. LONGS PEAK EMERGENCY PHYSICIANS, P.C.; Albert H. Colton, M.D.; Herbert Ogden, M.D.; Michael Monahan, M.D.; and Merle Miller, M.D., Defendants-Appellees.
    No. 02CA0756.
    Colorado Court of Appeals, Div. I.
    May 8, 2003.

      Anita S. Fiddleman, PLLC., Anita S. Fiddleman, Boulder, Colorado; The Spillman Law Firm, LLC., Jason Slade Spillman, Trenton, Missouri, for Plaintiff-Appellant.
    Caplan and Earnest, LLC., Peter M. Hamilton, Mark B. Wiletsky, Derek Kier-nan-Johnson, Boulder, Colorado, for Defendants-Appellees.

       Sitting by assignment of the Chief Justice under provisions of Colo. Const. art. VI, § 5(3), and § 24-51-1105, C.R.S.2002.

   Opinion by

Judge GRAHAM.

Plaintiff, Ronald T. Genova, M.D., appeals the judgment entered on jury verdicts in favor of defendants, Longs Peak Emergency Physicians, P.C. (LPEP); Albert H. Colton, M.D.; Herbert Ogden, M.D.; Michael Mona-han, M.D.; and Merle Miller, M.D., on plaintiff's claims of wrongful discharge in violation of public policy and breach of fiduciary duty. We affirm.

LPEP is a physician-owned professional corporation that provides emergency medical services to Longmont United Hospital Plaintiff became an employee, shareholder, and director of LPEP in 1998. The individual defendants are shareholders and employees of LPEP.

In July 1999, defendants terminated plaintiff's employment and provided plaintiff with four months severance pay in accordance with his employment contract. LPEP requested the return of plaintiff's stock certificate in exchange for $100 pursuant to the shareholders' agreement, which provided that upon termination for any reason, a shareholder must sell his or her stock to LPEP for $100.

Plaintiff alleged that LPEP wrongfully discharged him in violation of public policy, that LPEP breached its employment contract with him, and that the individual defendants breached their fiduciary duties to him by undermining his standing with Longmont United Hospital and related conduct.

The jury awarded plaintiff $34,944 on his breach of contract claim, but found in favor of defendants on the wrongful discharge and breach of fiduciary duty claims.

I.

We first reject plaintiffs contention that the trial court abused its discretion in exelud-ing evidence of the value of his ownership interest in LPEP and in not instructing the jury that the loss of that value was recoverable in tort.

Contrary to defendants' assertion, plaintiff argued in the trial court that ownership value in LPEP was relevant to prove the damages component of his breach of fiduciary duty claim. The trial court specifically ruled on that issue, finding that loss of value was not relevant to establish damages and not recoverable for breach of fiduciary duty. Thus, we deem this issue to have been sufficiently raised for purposes of appellate review.

A.

Plaintiff first argues that evidence of the value of his purported twenty percent ownership interest in LPEP was admissible and relevant to his breach of fiduciary duty claim. We conclude the trial court did not abuse its discretion because such evidence was irrelevant and would have confused the Jury.

We review a trial court's ruling admitting or excluding evidence under an abuse of discretion standard. Hock v. N.Y. Life Ins. Co., 876 P.2d 1242 (Colo.1994). A court abuses its discretion when it rules based on an erroneous application of the law. Wallbank v. Rothenberg, 74 P.8d 413, 2003 WL 80427 (Colo.App. No. O1CA1949, Jan. 2, 2008). A trial court's exercise of discretion should not be overturned on appeal unless its ruling was manifestly arbitrary, unreasonable, or unfair. Wallbank v. Rothenberg, swpra.

However, a trial court's ruling exelud-ing evidence is reversible error only if a substantial right of a party is affected, that is, if the error substantially influenced the outcome of the case. Devenyns v. Hartig, 983 P.2d 63 (Colo.App.1998).

Under CRE 401, proffered evidence must relate to a fact "that is of consequence to the determination of the action." In essence, the evidence must be legally material to some factual issue in the case. Pennington v. Sears, Roebuck & Co., 878 P.2d 152 (Colo. App.1994).

If the proffered evidence is legally material, its admissibility becomes dependent on whether it has any tendency to make the existence of a consequential fact more probable or less probable than it would be without the evidence, that is, it must be logically relevant. Pennington v. Sears, Roebuck & Co., supra.

The elements of a claim for relief determine whether the challenged evidence relates to a fact of consequence. Damages are a necessary part of establishing a prima facie case of breach of fiduciary duty. Miller v. Byrne, 916 P.2d 566 (Colo.App.1995)

Here, the trial court ruled that the shareholders' agreement, which limits plaintiff's interest to $100 in the event of termination, did not justify the admission of plaintiffs expert testimony that plaintiff owned a twenty percent interest in LPEP worth in excess of $300,000. The court reasoned that allowing evidence of the fair market value of a shareholder's interest would render the shareholders' agreement meaningless. The trial court also found that any determination of LPEP's fair market value would be speculation.

Plaintiff argues that, by precluding evidence of the value of his ownership interest, the court essentially applied an economic loss rule to his claim. In Town of Alma v. AZCO Construction, Inc., 10 P.3d 1256 (Colo.2000), the supreme court held that a party suffering only economic loss from a breach of an express or implied contract could not assert an independent tort claim in the absence of an independent duty giving rise to the tort claim.

There is a distinction between the damages theories available in breach of contract claims and those available in tort claims. Contractual damages are limited to those foreseen by the parties when their bargain was struck. Vanderbeek v. Vernon Corp., 50 P.3d 866 (Colo.2002). This damages calculation, first applied in Hadley v. Baxendale, 9 Ex. 341, 156 Eng. Rep. 145 (1854), assures that contractual lability is limited to mutually allocated risks which were contemplated and foreseeable at the time of contract negotiations.

In contrast, tort damage analysis focuses on the concept of proximate cause and allows recovery of damages that were the particular consequence of the tort. Whether the claimant "reasonably contemplated a particular consequence as the probable result of the tort at the time it occurred is irrelevant." Vanderbeek v. Vernon Corp., supra, 50 P.3d at 871.

Here, the trial court allowed plaintiff to assert his tort claim for breach of fiduciary duty, but plaintiff offered only a theory that sought to compensate him for the loss of something he did not own, namely, a one-fifth interest in LPEP. No other theory of damages was advanced. Plaintiff's equity ownership in LPEP was subject to his right to receive $100 for his stock. Although he was free to offer proof of other damages proximately caused by the breach of fiduciary duty, he did not do so.

The trial court did not apply the economic loss rule and instead allowed plaintiff to put on proof of separate and distinct tort claims. However, the court properly refused to allow proof of a damages theory based on plaintiff's equity ownership because it was contrary to the facts in evidence. The record reflects that plaintiff never had a twenty percent interest in LPEP. Thus, the trial court did not err in precluding evidence of a nonexistent ownership.

B.

Plaintiff further contends that the trial court erred in refusing to instruct the jury that loss of assets or property is recoverable in tort. We disagree.

A trial court has a duty to instruct the jury correctly on the law applicable to the case. A party is entitled to a jury instruction if it is supported by the evidence and consistent with the existing law. Deven, yns v. Hartig, supra.

Although the Colorado Civil Jury Instruction Manual includes loss of assets or property as damages that may be recoverable for a breach of fiduciary duty, here, the trial court instructed the jury that in determining damages for that claim, it could consider:

1. Any noneconomic losses or injuries which plaintiff has had or will probably have in the future, including: pain and suffering, inconvenience, emotional stress, and impairment of the quality of life; and,
2, -Any economic losses which plaintiff has had or will probably have in the future, including:
a. Anything of value or any profit the defendants, Colton, Ogden, Monahan or Miller, received as a result of the breach of fiduciary duty; and
b. Any loss of profits and/or income which plaintiff could reasonably have expected to earn had the fiduciary duty not been breached.

Based upon the record, plaintiff's claim could only have resulted in economic damages based upon loss of future earnings as a continuing employee. He did not suggest that he had been defrauded in connection with the shareholders' agreement or proffer any other reason why the shareholders agreement did not properly fix the value of his interest. In fact, before trial, defendants prevailed on summary judgment on plaintiff's claim that the shareholders' agreement should be reformed to reflect an oral agreement granting him an increased equity ownership. Thus, the jury instruction was proper and conformed to the evidence.

C.

Plaintiff next argues that the trial court erred in refusing to instruct the jury that loss of assets or property is recoverable on a claim for wrongful termination in violation of public policy. We are not persuaded.

Economic damages for wrongful discharge are limited to back pay, loss of future pay, loss of benefits, and related economic losses proximately resulting from the discharge. Economic damages are appropriate to "put the wrongfully discharged employee in the same position he ... would have been in had the employer not breach[ed] the employment contract." Decker v. Browning-Ferris Indus. of Colo., Inc., 947 P.2d 937, 940-41 (Colo.1997)(quoting Decker v. Browning-Ferris Indus. of Colo., Inc., 931 P.2d 436, 447 (Colo.1997)).

The trial court properly instructed the jury that:

If you find in favor of the plaintiff, you must determine the total dollar amount of plaintiffs damages, if any, that were caused by the wrongful discharge of the plaintiff by defendant.
In determining such damages, you shall consider the following: |
1. Any noneconomic losses or injuries which plaintiff has had or will probably have in the future, including: pain and suffering, inconvenience, emotional stress, and impairment of the quality of life; and,
2, Any economic losses or injuries which plaintiff has had, including lost back wages, consisting of the difference between the wages plaintiff would have earned between the time he was fired and August 1, 2001, had he not been wrongfully discharged, less the amount he was able to earn through other employment or work.
Lost back pay is intended to make the plaintiff whole.

Thus, because economic damages for wrongful discharge do not include loss of assets or property, it was not error for the trial court to refuse to give plaintiffs proposed jury instruction.

IL

Plaintiff next contends that the trial court erred in ruling that LPEP could invoke the attorney-client privilege against him as to communications between counsel to LPEP and other directors and officers during plaintiff's tenure as a director and officer of LPEP. We find no error.

Some procedural background is necessary to place this issue in perspective. In the trial court, plaintiff sought to disqualify LPEP's counsel, who had entered their appearance on behalf of LPEP and the individual defendants,. Before the hearing on that motion, plaintiff served a subpoena duces tecum upon counsel, directing them to bring to the hearing "all documents, correspondence and other items contained in defense counsel's LPEP file, from the inception of LPEP's relationship with defense counsel through LPEP's termination of plaintiff's employment on November 26, 1999."

The motion to disqualify urged that counsel were necessary witnesses at trial because they had been provided specific information regarding: (1) the validity of plaintiff's actions, on behalf of LPEP and their assistance regarding the formation of Boulder County Physicians Advisory Council (BCPAC); (2) the reasons for LPEP's termination of plaintiffs employment; (8) LPEP's minute and record-keeping practices and, specifically, defense counsel's advice regarding, and role in, these practices; and (4) defense counsel's negotiation, on behalf of LPEP, of a compensation agreement between LPEP and the hospital.

LPEP argued that its counsel should not be disqualified because the information plaintiff sought was protected by the attorney-client privilege.

In its order, the trial court concluded that defense counsel were not necessary witnesses because their anticipated testimony either was protected by the attorney-client privilege and therefore inadmissible or concerned matters about which they had no knowledge. The trial court reasoned that LPEP, and not the individual directors, held the attorney-client privilege and that such privilege could be asserted against plaintiff, a former director, even with respect to information shared with corporate counsel during plaintiff's tenure.

A.

We reject defendants' contention that we should not address the merits of the attorney-client privilege issue on appeal because plaintiff is not appealing the refusal to disqualify, but is instead arguing that he was denied discovery which he never sought to compel.

Although plaintiff never served discovery requests related to the privileged documents, he served a subpoena duces tecum upon defense counsel.

In its order denying the disqualification of defense counsel, the trial court essentially made a discovery ruling when it determined that LPEP could invoke the attorney-client privilege against plaintiff and quashed the subpoena, making plaintiff's further discovery attempts futile.

We conclude that the attorney-client privilege issue was sufficiently raised in the trial court, and the adverse ruling provides a sufficient basis for appeal.

B.

We do not perceive error in the trial court's ruling that the attorney-client privilege may be asserted by a corporation against a former director.

"An attorney shall not be examined without the consent of his client as to any communication made by the client to him or his advice given thereon in the course of professional employment...." Section 183-90-107(1)(b), C.R.8.2002.

The privilege is "rooted in the principle that candid and open discussion by the client to the attorney without fear of disclosure will promote the orderly administration of justice." Law Offices of Bernard D. Morley, P.C. v. MacFarlane, 647 P.2d 1215, 1221 (Colo.1982)(quoting A. v. Dist Court, 191 Colo. 10, 22, 550 P.2d 815, 324 (1976)). Protecting confidential communications between an attorney and a client "not only facilitates the full development of facts essential to proper representation of the client but also encourages the general public to seek early legal assistance." Nat'l Farmers Union Prop. & Cas. Co. v. Dist. Court, 718 P.2d 1044, 1047 (Colo.1986).

Despite the strong policy reasons that give rise to it, the attorney-client privilege is not absolute, and when the social policies underlying the privilege conflict with other prevailing public policies, the attorney-client privilege must give way. Law Offices of Bernard D. Morley, P.C. v. MacFarlane, supra.

It is well established that the attorney-client privilege attaches to corporations as well as to individuals. The administration of the attorney-client privilege in the case of corporations, however, presents special problems. As an inanimate entity, a corporation must act through agents. Although it is a separate juristic entity, a corporation cannot speak directly to its lawyers. Similarly, it cannot directly waive the privilege when disclosure is in its best interest. Each of these actions must be undertaken by individuals empowered to act on behalf of the corporation. Commodity Futures Trading Comm'n v. Weintraub, 471 U.S. 343, 105 S.Ct. 1986, 85 L.Ed.2d 372 (1985).

Consequently, _ communications between corporate counsel and company personnel are privileged so long as they concern matters within the scope of the employees' corporate duties Upjohn Co. v. United States, 449 U.S. 383, 101 S.Ct. 677, 66 L.Ed.2d 584 (1981). An otherwise privileged communication by a lawyer to a corporate agent does not lose its protected status simply because the agent then conveys the attorney's opinion to corporate management charged with acting on such issues. Shriver v. Baskin-Robbins Ice Cream Co., 145 F.R.D. 112 (D.Colo.1992); In re Grand Jury 90-1, 758 F.Supp. 1411 (D.Colo.1991).

Whether plaintiff, as a former officer, director, and shareholder of LPEP, is entitled to privileged documents from LPEP simply because the documents were generated during his tenure is an issue of first impression in Colorado. While we recognize that courts in other jurisdictions are split, we agree with the line of cases concluding that the attorney-client privilege may be established against a former director of a corporation. Accordingly, we hold that the privilege may nevertheless be asserted against plaintiff in this instance and thus discern no error in the trial court's ruling.

Some courts have determined that a corporation may not assert the attorney-client privilege against a former director in such a situation. Gottlieb v. Wiles, 143 FRD. 241 (D.Colo.1992); Kirby v. Kirby, 1987 WL 14862 (Del.Ch. July 29, 1987); see also Garner v. Wolfinbarger, 430 F.2d 1098 (5th Cir.1970)(in a stockholder class action, the class could obtain documents over the corporation's claim of privilege with a showing of good cause); Neusteter v. Dist. Court, 675 P.2d 1 (Colo.1984)(adopting Garner v. Wolfinbarger, supra, and holding that shareholders are permitted to show that there was good cause not to permit disclosure to be thwarted by the accountant-client privilege, which is analogous to the attorney-client privilege).

In Kirby v. Kirby, swpra, the Delaware Chancery Court reasoned that all directors are responsible for the proper management of the corporation and concluded that the attorney-client privilege could not be asserted against a former director.

Gottlieb v. Wiles, supra, relying on Kirby, treated this situation as similar to that where parties with a common interest retain a single attorney to represent them. When those parties later become adverse, no party is permitted to assert the attorney-client privilege as to communications occurring during the period of common interest. @Goféheb v. Wiles, supra.

However, other courts have held that the authority to assert and waive a solvent corporation's attorney-client privilege rests with current management. Commodity Futures Trading Comm'n v. Weintraub, supra; Milroy v. Hanson, 875 F.Supp. 646 (D.Neb. 1995); In re Mktg. Investors Corp., 80 S.W.3d 44 (Tex.Ct.App.1998); Lane v. Sharp Packaging Sys., Inc., 251 Wis.2d 68, 640 N.W.2d 788 (2002).

These courts stress that the corporation, and not its individual shareholders or managers, is the client. Commodity Futures Trading Comm'n v. Weintroub, supra; Milroy v. Hanson, supra. See Professional Conduct Rule 1.83.

In Milroy, the court determined that a director and minority stockholder of a corporation has no right to documents otherwise protected under the attorney-client privilege. The Milroy court disagreed with Kirby:

With all due respect, cases like Kirby, Harris [v. Wells 1990 WL 150445 (D.Conn. Sept. 5, 1990)] and Gottlieb make a fundamental error by assuming that for a corporation there exists a "collective corporate 'client'" which may take a position adverse to "management" for purposes of the attorney-client privilege. There is but one client, and that client is the corporation. This is true despite the fact that a corporation can only act through human beings.... A dissident director is by definition not "management" and, accordingly, has no authority to pierce or otherwise frustrate the attorney-client privilege when such action conflicts with the will of "management."

Milroy v. Hanson, supra, 875 F.Supp. at 649-50 (citations omitted).

The Milroy court held that the dissident director "has no right to waive or otherwise pieree [the corporation's] attorney-client privilege because he is not the (management' of the corporation and 'management' of the corporation, as it has a right to do, asserts the privilege against him." Milroy v. Hanson, supra, 875 F.Supp. at 651.

We agree with the court's reasoning in Milroy. Although plaintiff's status as a former director would have entitled him to learn privileged information when he was a director, he would then have been duty bound to keep such information confidential. He would not have been entitled alone to assert or waive the privilege on behalf of LPEP. See Commodity Futures Trading Comm'n v. Weintraub, supra.

Now, plaintiff is adverse to LPEP and no longer has a duty to maintain the sanctity of the information; indeed, his expressed intent is to vitiate the privilege and release the documents to a public forum, notwithstanding his fiduciary duty as a former officer and director. In these circumstances, we see no logic in relying upon his former status to now release confidential information to him. Hence, we conclude that the privilege may be asserted against an adverse litigant, and the trial court's same conclusion justified its refusal to disqualify LPEP's attorneys.

This is not a case where defense counsel once represented plaintiff individually, nor is it a case where counsel seeks to use information once shared in confidence by plaintiff against him. The record indicates that all the client information shared and advice given were related solely to the business of the corporate client.

Thus, plaintiff's status as a former director and "dissident" does not entitle him to access defense counsel's files regarding communications with LPEP. The attorney-client privilege belongs to LPEP-defense counsel's client-and only LPEP can waive that privilege. Although a corporate client can act only through its officers, directors, employees, shareholders, or agents, we conclude that a former director cannot purport to act on behalf of the client corporation and waive the attorney-client privilege.

IIL

Plaintiff contends that the trial court abused its discretion in denying his motion for a mistrial after one of the defendants testified to certain portions of a settlement letter that the trial court had exeluded under CRE 408. Again, we disagree.

A mistrial is warranted when the prejudice created by improper testimony renders the trial unfair to the other party. It is within the discretion of the trial court whether to grant a mistrial, and only if the trial court abuses this discretion will we find reversible error. A court abuses its discretion only when its actions are manifestly arbitrary, unreasonable, or unfair. Margenau v. Bowlin, 12 P.3d 1214 (Colo.App.2000). A trial court can better evaluate any adverse effect that improper testimony might have upon a jury than can a reviewing court. People v. Ned, 928 P.2d 271 (Colo.App.1996).

CRE 408 bars the admission of offers to compromise disputed claims, including evidence of conduct and statements made during the course of compromise negotiations. Nonetheless, exceptions to the rule exist when the evidence is offered for purposes other than proving liability or invalidity of the claim amount, such as "proving bias or prejudice of a witness, negativing a contention of undue delay, or proving an effort to obstruct a eriminal investigation or prosecution." Contrary to plaintiff's contention, the list of "other purposes" enumerated in CRE 408 is not exclusive.

Here, the trial court excluded a settlement letter from plaintiff's former attorney pursuant to CRE 408. However, on the sixth day of an eight-day trial, one of the individual defendants, after being questioned why plaintiff did not receive a year-end distribution after he was terminated, testified: "Shortly after the termination letter, we received subsequent correspondence from [plaintiff] that made clear reference to a lawsuit, and to dollar figures that were multiples in excess of ... the figure that came out of this formula."

The trial court overruled plaintiff's objection to the reference and reasoned that the purpose of the testimony was to rebut a contention that defendants acted in a willful and wanton manner with regard to terminating plaintiff, which was relevant to plaintiff's request for punitive damages. The statement was made after plaintiff's termination. The trial court further noted that such "passing reference" on the sixth day of trial did not create sufficient prejudice to warrant a mistrial.

There is evidence in the record to support the trial court's findings and conclusions. Accordingly, its determination was neither manifestly arbitrary, unreasonable, or unfair, and thus, it will not be disturbed on review.

IV.

We likewise conclude that the trial court did not abuse its discretion in excluding specific evidence of patient care and limiting plaintiff's expert witness's testimony to the legitimacy of plaintiff's concerns related to patient care.

The Colorado Rules of Evidence grant trial courts the discretion to exelude relevant evidence where "its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence." CRE 408. In exercising its discretion under this rule, a trial court "must consider the probative value of the proposed evidence ... in light of the nature of the case, the nature of the offered evidence, and the other evidence admitted during the trial." Cherry Creek Sch. Dist. No. 5 v. Voelker, 859 P2d 805, 811 (Colo.1993)(quoting People v. Rubanowitz, 688 P.2d 281, 245 (Colo.1984)).

As relevant here, to his wrongful discharge claim, plaintiff was required to show, inter alia, that: defendant prohibited him from performing a public duty or exercising an important job-related right or privilege; in violation of a statute relating to the public health, safety, or welfare or a clearly expressed public policy. See Coors Brewing Co. v. Floyd, 978 P.2d 668 (Colo.1999); Martin Marietta Corp. v. Loreng, 823 P.2d 100 (Colo.1992).

To make that showing, plaintiff asserts that a paramedic notified him of concerns regarding care rendered to an asthmatic patient by one of the defendants. Plaintiff notified another defendant, who was the Quality Improvement Committee (Q1) chairperson, of the incident, but, according to plaintiff, neither he nor the paramedic was invited to the QI committee meeting at which the incident was discussed. Plaintiff asserts that he later complained to that defendant about his and the paramediec's exclusion from the process and that this incident contributed to defendants' decision to discharge him.

On - erosg-examination, plaintiff stated, "The case, in my opinion, just wasn't appropriately investigated. That's the problem. I had no idea whether this was an inappropriate situation or not. It wasn't for me to judge. I did not have all of the information, nor did Dr. Ogden or Dr. Miller or any other member." Plaintiff thus concedes that the issue is not whether proper care was rendered to the patient, but rather whether the QI committee properly investigated the situation.

The trial court repeatedly attempted to limit unnecessary details about the incident, particularly the patient's death, without preventing plaintiff from presenting some context for his concerns. Nevertheless, plaintiff's counsel referred to the patient's death in opening statement, as did plaintiff on direct examination.

The trial court prohibited the paramedic from testifying about the details and outcome of the incident because such testimony could raise medical malpractice issues and could confuse the jury.

On direct examination, plaintiff also testified about his concerns regarding the quality of care rendered by paramedics from the local fire departments and the nurse staffing shortage at the hospital. Plaintiff's expert testified about why these concerns were legitimate.

We agree with the trial court that specific details about patient care are not relevant to the issues in the case. Those details likely would have confused the jury by creating a trial within a trial. Moreover, exclusion of those details was harmless in light of the testimony plaintiff presented regarding quality of care issues. Thus, the trial court's limitation of such testimony was not an abuse of discretion.

v.

Finally, plaintiff contends that the trial court abused its discretion in imposing only monetary sanctions on defendants for introducing at trial nondisclosed evidence of LPEP's 1999 year-end distributions. Plaintiff argues that the court instead should have ordered "a new trial solely on damages at which Defendants shall be prohibited from offering any evidence of 1999 year-end distributions" or should have entered judgment in the amount of $59,000, which, according to plaintiff's expert, was his estimate of the 1999 year-end distribution. We perceive no abuse of discretion.

Plaintiff argues that the evidence unfairly prejudiced his case. Specifically, he contends that he did not accept defendants' offer of settlement for $42,428.33 because he did not have the benefit of the year-end distribution calculations. Plaintiff asserts that he was forced to rely solely on his expert's estimate and could not adequately assess the settlement offer. We are not persuaded that any such prejudice would warrant the sanctions plaintiff requests.

Pursuant to C.R.C.P. 37(c), the trial court may impose appropriate sanctions if a party fails to disclose information required by C.R.C.P. 26(a) or (e), unless such failure was substantially justified or harmless. The burden is on the nondisclosing party to establish that its nondisclosure was substantially justified or harmless. Miller v. Rowtech, LLC, 8 P.83d 492 (Colo.App.2000).

Appropriate sanctions, in addition to payment of reasonable expenses and attorney fees caused by the failure to disclose information, may include:

(A) An order that the matters regarding which the order was made or any other designated facts shall be taken to be established for the purposes of the action in accordance with the claim of the party obtaining the order;
(B) An order refusing to allow the disobedient party to support or oppose designated claims or defenses, or prohibiting him from introducing designated matters in evidence; [and]
(C) An order striking out pleadings or parts thereof, or staying further proceedings until the order is obeyed, or dismissing the action or proceeding or any part thereof, or rendering a judgment by default against the disobedient party.

C.R.C.P. 37(b)(2).

Here, plaintiff served discovery upon defendants specifically requesting corporate financial documents, including balance sheets. On the second day of trial, defendants finally provided their exhibit list, which included a balance sheet entitled "Year-end 1999 Distribution Calculation Sheets." Defendants had not produced the document or information before trial.

Over plaintiff's objection, the trial court allowed one of the defendants to use the document to refresh his recollection, and he testified that each shareholder received a 1999 year-end distribution of $47,592.88. The document was not admitted into evidence.

The trial court concluded that allowing defendants to testify from the nondisclosed document was not prejudicial to plaintiff, and, thus, the appropriate sanction for the late disclosure was not to exclude the evidence, which would have left the jury with only estimates as to the actual value of the year-end disbursements, but instead was to allow plaintiff to recover the costs incurred in having to retain an expert to estimate that value.

Plaintiff filed a posttrial motion for sanctions pursuant to C.R.C.P. 37, seeking an order awarding him attorney fees and costs, as well as prohibiting defendants from recovering their costs. The trial court found that defendants' nondisclosure violated C.R.C.P. 26(a) and (e) and awarded plaintiff $11,402 incurred in hiring the expert.

We agree with defendants that the trial court did not abuse its discretion. C.R.C.P. 37 permits the trial court to choose appropriate sanctions, which may include evidence preclusion. However, that sanction is not mandatory.

The judgment is affirmed.

Judge TAUBMAN and Judge PLANK, concur.


author: Judge METZGER.

text:
    Samuel L. DANIELS, Plaintiff-Appellant, v. CALEEL + HAYDEN, L.L.C., a Delaware limited liability Company, Defendant-Appellee.
    No. 02CA0789.
    Colorado Court of Appeals, Div. A.
    May 8, 2003.

      David Lichtenstein, Denver, Colorado, for Plaintiff-Appellant.
    Tiemeier & Hensen, P.C., Stephen J. Hen-sen, C. Todd Drake, Denver, Colorado, for Defendant-Appellee.
   Opinion by

Judge METZGER.

Plaintiff, Samuel L. Daniels, appeals the summary judgment that concluded, as a matter of law, that he was an exempt employee under the federal Fair Labor Standards Act (FLSA) while employed by defendant, Ca-leel+Hayden, L.L.C. (company). We reverse and remand the case for further proceedings.

Daniels was employed by the company as an accounts payable specialist from January until April 2001. On the company's motion for summary judgment, the trial court determined that he was exempt from overtime pay as an administrative employee pursuant to 29 U.S.C. § 218(a)(1) of the FLSA.

I.

Daniels contends that the entry of summary judgment was improper because disputed factual issues remain concerning his exempt status. We agree.

Appellate courts review a summary judgment de novo. Summary judgment is appropriate when the moving party has suceessfully carried the burden of showing that no genuine issues of material fact remain to be determined. See C.R.C.P. 56(c); Aspen Wilderness Workshop, Inc. v. Colo. Water Conservation Bd., 901 P.2d 1251, 1256 (Colo.1995).

Whether an employee is exempt from overtime under the FLSA is a conclusion of law, which we review de novo. Reich v. Wyoming, 993 F.2d 739, 741 (10th Cir.19983).

The § 218(a)(1) exemption applies to employees in "bona fide executive, administrative, or professional" capacities, The Seere-tary of Labor has promulgated regulations to assist in determining whether an employee meets the requirements of the exemption. 29 C.E.R. § 541.2 (2002).

Exemptions under the FLSA are to be narrowly construed. The employer must show that the employee "plainly and unmistakably" falls within the exemption's terms. Arnold v. Ben Kanowsky, Inc., 361 U.S. 388, 892, 80 S.Ct. 453, 456, 4 L.Ed.2d 898 (1960).

The appropriate legal test to determine an employee's exemption from overtime is found at 29 C.F.R. § 541.214 (2002). See Spinden v. GS Roofing Products Co., 94 F.3d 421, 426 (8th Cir.1996). To be exempt, an employee must earn a salary or fee of at least $250 per week and have a:

primary duty [which] consists of either the performance of office or nonmanual work directly related to management policies or general business operations of the employer ... where the performance of such primary duty includes work requiring the exercise of discretion and independent judgment.

29 CBR,. § 541.214.

The phrases "nonmanual work," "directly related to management policies or general business operations," "primary duty," and "discretion and independent judgment" are all further defined in the regulations. 29 C.E.R. §§ 541,208, 541.205-541.207 (2002).

A.

It is undisputed that Daniels's salary was more than $250 per week and the work involved here was office work. However, the parties do not agree about the nature of Daniels's primary duty.

Section 541.206 incorporates by reference the definition of "primary duty" from the regulations for the executive exemption to 29 U.S.C. § 2183(a)(1), found in 29 C.F.R. § 541,108. Section 541.108 states that a general guideline to use in evaluating the "primary duty" requirement is whether an employee spends over fifty percent of his or her time on those activities. However, even if an employee spends less than fifty percent of his or her time on administrative activities, the cireumstances surrounding the job may still support a conclusion that the employee is within the exemption. See 29 C.E.R. § 541.108; Dep't of Labor v. City of Sapulpa, 30 F.3d 1285, 1287-88 (10th Cir.1994).

Here, the record contains evidence that Daniels devoted at least fifty percent of his time to processing accounts payable, but the skills required may have been classified as only clerical or basic bookkeeping.

Because it is unclear whether Daniels met the fifty percent guideline, we must look to other factors in analyzing the issue. These include the relative importance of the administrative duties when compared to the other duties, the frequency with which discretion was exercised, the employee's relative freedom from supervision, and the employee's wages compared to the wages of those who perform nonexempt work. Section 541.108; Spinden v. GS Roofing Products Co., supra, 94 F.3d at 427 (employee found to be administrative despite having only ten percent administrative responsibilities, where that ten percent consisted of preparing vital business reports and other significant tasks); Dep't of Labor v. City of Sapulpa, supra, 30 F.3d at 1288.

This analysis requires factual determinations which are in dispute at this point in the litigation. Accordingly, the summary judgment cannot stand.

B.

The second prong of the test is whether the primary duty was directly related to management policies or general business operations. We also conclude that the record on this point does not support the entry of summary judgment.

The pivotal distinction is between those jobs that are "run-of-the-mill [mine] positions in an ordinary business" and those that make policy or "affect business operations to a substantial degree." Section 541.205(c).

Here, the record does not show the degree of impact each of Daniels's job functions had upon the general business operations of the company. Daniels did not exercise any supervisory authority over other employees, and the record does not reflect the importance of his accounts payable duties to the company. Cf. Spindern, supra, 94 F.3d at 428; Hills v. Western Paper Co., 825 F.Supp. 936, 988 (D.Kan.1993).

Section 541.205(b) explicitly lists "advising the management" and "business ... control" as administrative duties. Because there are disputes regarding how much of Daniels's work, if any, consisted of advising the management of the company or of control fune-tions, the summary judgment cannot stand.

C.

Finally, to qualify as exempt, the employee's position must require the exercise of discretion and independent judgment. This is more than the use of skills to follow routine procedures, 29 CFR. § 541.207, "choices involving matters of little or no consequence," and clerical-type decisions. It includes the formulation of policies. Section 541.207(d)(2).

It appears from the record that, arguably, Daniels performed both types of functions. The regulations are clear, however, that "many thousands of possible factual situations" could present themselves in making this determination. Section 541.207(d)(2); see also Bothell v. Phase Metrics, Inc., 299 F.3d 1120, 1129 (9th Cir.2002). Thus, further factual determinations concerning the degree to which Daniels exercised discretion and independent judgment are necessary.

IL.

Daniels also argues that the trial court erred in entering summary judgment because he was, at most, training for the position and never fully assumed the duties which would qualify him as an exempt bona fide administrative employee. We conclude that further proceedings are necessary on this point as well.

This argument relies on 29 CER. § 541.210, which says:

The exemption is applicable to an employee employed in a bona fide administrative capacity and does not include employees training for employment in an administrative capacity who are not actually performing the duties of an administrative employee.

For this section to apply, an employee must satisfy two requirements. First, he or she must be in training for an administrative position. Second, the employee must not be performing the duties of an administrative employee.

Here, there are disputed facts in the record on these points. Thus, the entry of summary judgment was incorrect.

The judgment is reversed, and the case is remanded for further proceedings.

Judge CASEBOLT and Judge CRISWELL* concur.

       Sitting by assignment of the Chief Justice under provisions of Colo. Const. art. VI, § 5(3), and § 24-51-1105, C.R.S.2002.