Elite Storage v. Dan Brennan

23CA2094 Elite Storage v Dan Brennan 12-12-2024

COLORADO COURT OF APPEALS

Court of Appeals No. 23CA2094
Weld County District Court No. 21CV30550
Honorable Shannon D. Lyons, Judge

Elite Storage Holdings, LLC, a Colorado limited liability company,

Plaintiff-Appellant,

v.

Dan Brennan, LLC, a Colorado limited liability company,

Defendant-Appellee.

JUDGMENT AFFIRMED AND CASE REMANDED WITH DIRECTIONS

Division VII
Opinion by JUDGE SCHUTZ
Tow and Pawar, JJ., concur

NOT PUBLISHED PURSUANT TO C.A.R. 35(e)
Announced December 12, 2024

Nelson Mullins Riley & Scarborough, LLP, Blake A. Gansborg, Denver,
Colorado; Nelson Mullins Riley & Scarborough, LLP, Terrance W. Anderson, Jr.,
Boca Raton, Florida, for Plaintiff-Appellant

Flanders, Elsberg, Herber & Dunn, LLC, Mark A. Herber, Andrew N. Dunkin,
Longmont, Colorado, for Defendant-Appellee
¶1 Elite Storage Holdings, LLC (Elite) appeals the trial court’s

judgment on its breach of contract claims brought against Dan

Brennan, LLC (Brennan). We affirm the judgment and remand the

case so that the trial court may determine and award Brennan its

reasonable attorney fees incurred on appeal.

I. Background

¶2 After a bench trial, the court made findings of fact and

conclusions of law that reveal the following.

¶3 Dan Brennan was the sole member and manager of Brennan,

LLC and sole shareholder of Highway 85 Self-Storage, Inc. (Highway

85). Highway 85 owned and operated a self-storage business, and

Brennan owns the land on which the business is located.

¶4 Cory Herman-Calvin (Calvin1) owned several companies.

While the parties negotiated the contracts in question, he created

and became the sole member and manager of Elite.

1 During his testimony at trial, Calvin gave his legal name as Cory

Herman-Calvin. However, throughout proceedings at the trial
court, and the briefs and oral argument to this court, he was
referred to by all parties as Cory Calvin. We adopt this convention.
¶5 Brennan, Highway 85, and Elite2 entered into contracts for

Elite to purchase both the assets of Highway 85 and the associated

land. The sale was divided into two contracts: one for the purchase

of the self-storage business, called the Asset Purchase Agreement

(APA); the second for the land purchase, called the Purchase and

Sale Agreement (PSA). Each contract included a purchase price of

$4 million, for a combined purchase price of $8 million, with $1.6

million due from Elite at closing. Although the purchase price was

divided equally between both transactions — apparently for tax

purposes — the vast majority of the value encompassed by the

combined purchase price was attributed to the land.

¶6 The parties spent months completing the contractually

required delivery of documents and due diligence. The PSA

contained a sixty-day inspection period, during which Brennan was

required to deliver specific documents and information to Elite.

¶7 The contracts specified that the closing date was to be held

within thirty days of the completion of the inspection period. Elite

had the right to extend the closing date by one day for each day

2 The rights associated with the subject contracts are Elite’s only

asset.
that Brennan delayed providing the specified documents. Elite also

had the right to delay the closing period one time for a period not to

exceed sixty days. The contracts contained no mechanism by

which the inspection period could be reopened once it was closed

without objection.

¶8 During the inspection period, Elite made two objections. First,

it asserted that Brennan had not provided three specified

documents. Brennan later provided those documents, and Elite

made no further objection with respect to them.

¶9 Second, Elite objected to an unresolved dispute related a

thirty-foot access easement on the property. Because the easement

issue needed to be resolved, the parties extended the inspection

period multiple times, with the final amendment stating that the

inspection period would end the earlier of June 15, 2021, or the

date a new easement was recorded.

¶ 10 Because the parties could not close until the inspection period

was finished, the closing date was moved each time the inspection

period was extended. A mutually acceptable revised easement was

recorded on June 24, 2021. Thus, the inspection period ended on
June 15, 2021. By mutual agreement, the parties set a closing date

of July 19, 2021.

¶ 11 During the prolonged inspection period, Calvin attempted to

raise funds to close the contracts. He eventually obtained investor

support, but then told the investors that he did not intend to go

through with the purchases. Instead, he moved forward alone.

¶ 12 The night before the scheduled closing, Calvin informed

Brennan that Elite would not be going through with closing on

either contract, raising several purportedly unresolved issues.

¶ 13 Elite failed to close as scheduled, even though Brennan and

Highway 85 were ready, willing, and able to close. The trial court

found that on July 19, 2021, Elite did not have the funds necessary

to close the purchase.

¶ 14 Elite initially sued Brennan and Highway 85 for breach of the

APA and PSA, requesting specific performance and declaratory

relief. Elite subsequently dismissed its claims against Highway 85

under the APA but continued the suit against Brennan for

enforcement of the PSA, demanding that he be allowed to purchase

the land for $4 million.
¶ 15 Upon completion of the trial, the court entered findings of fact

and conclusions of law by which it rejected Elite’s claims and

entered judgment in favor of Brennan. The court subsequently

awarded Brennan its costs and attorney fees incurred in the trial

court pursuant to the PSA’s prevailing party attorney fees provision.

Elite now appeals the trial court’s judgment.

II. Analysis

A. Trial Court’s Adoption of Proposed Findings and Conclusions

¶ 16 Elite initially argues that the trial court adopted Brennan’s

proposed findings of fact and conclusions of law “without

modification” and later in the brief asserts that the trial’s court’s

order was “virtually unchanged” from what Brennan submitted.

Despite the conflicting language, we understand Elite’s argument to

be that the trial court basically adopted Brennan’s proposed

findings and conclusions without adequate consideration. Based

on this contention, Elite argues that we should apply heightened

scrutiny in reviewing the trial court’s findings of fact.

¶ 17 Brennan concedes that the trial court adopted its proposed

findings and conclusion in large part, but notes that the court also
made material changes before entering its findings of fact and

conclusions of law.

¶ 18 We review a trial court’s conclusions of law de novo. People v.

Owen, 122 P.3d 1006, 1007 (Colo. App. 2005). The interpretation

of a contract generally presents a question of law that we also

review de novo. Gagne v. Gagne, 2019 COA 42, ¶ 41.

¶ 19 Typically, we defer to a trial court’s factual findings, reviewing

them only for clear error. Id. at ¶ 17. However, if a trial court

adopts a party’s proposed findings and conclusions verbatim, those

findings and conclusions are subjected to heightened scrutiny.

Trask v. Nozisko, 134 P.3d 544, 548-49 (Colo. App. 2006); Uptime

Corp. v Colo. Rsch. Corp., 420 P.2d 232, 235 (Colo. 1966). Although

a district court has discretion to direct one or more parties to craft

proposed findings of fact and conclusions of law, see C.R.C.P. 121,

§ 1-16; Aztec Mins. Corp. v. State, 987 P.2d 895, 899 (Colo. App.

1999), the court should not adopt those findings “without apparent

review,” Trask, 134 P.3d at 549. After all, “[t]he task of the trial

court is not limited to picking winners and losers.” Trask, 134 P.3d

at 549.
¶ 20 When reviewing whether there is evidentiary support for the

trial court’s factual findings, our job is not to reweigh the evidence

or the credibility of witnesses. People v. Poe, 2012 COA 166, ¶ 14.

Nor is it our role to act as an independent fact finder to determine

how we would have resolved the disputed evidence if we were sitting

in the fact finder’s chair. See People v. Harrison, 2020 CO 57, ¶ 33

(“An appellate court may not serve as a thirteenth juror and

consider whether it might have reached a different conclusion than

the jury.”). Indeed, compared to appellate courts, trial court judges

are uniquely situated to determine the credibility of witnesses and

their testimony. See Owners Ins. Co. v. Dakota Station II Condo.

Ass’n, 2021 COA 114, ¶ 50. (“It’s the trial court’s sole province to

resolve factual issues, determine witness credibility, weigh evidence,

and make reasonable inferences from that evidence.”). These

venerable standards are applicable whether our review of the

factual findings is made through the lens of the traditional clear

error standard or heightened scrutiny.

¶ 21 In this case, the trial court did not adopt Brennan’s proposed

findings of fact and conclusions of law verbatim. Our review of the

proposed and issued documents confirms that they are indeed
substantially similar. But the trial court clearly reviewed and

modified Brennan’s proposed findings and conclusions before

issuing its own findings of fact and conclusions of law. For

example, it added a number of paragraphs, modified some proposed

findings, and deleted others.

¶ 22 Given the trial court’s edits and substantive additions and

deletions, we conclude the court sufficiently considered the

proposed findings and conclusions and, thus, no heightened

scrutiny on our part is required.

B. Breach of Contract Claims

¶ 23 At trial, Elite contended that the inspection period had not yet

concluded when it informed Brennan that it would not close

because Brennan had failed to provide several material documents.

Specifically, Elite noted that, despite its specific request, Brennan

had not provided it copies of fully executed advertising contracts for

two billboards located on the property, and all certificates of

occupancy for the property. Elite also claimed that the easement

and related property description remained outstanding issues at the

time of the scheduled closing.
1. Standard of Review and Applicable Law

¶ 24 A breach of contract claim requires proof of a contract,

performance by the plaintiff or a justification for nonperformance,

failure to perform by the defendant, and resulting damages to the

plaintiff. Marquardt v. Perry, 200 P.3d 1126, 1129 (Colo. App.

2008).

¶ 25 Interpretation of an unambiguous contract presents a

question of law that we review de novo. Pres. at the Fort, Ltd. v.

Prudential Huntoon Paige Assocs., 129 P.3d 1015, 1017-18 (Colo.

App. 2004). The scope of the parties’ respective duties and

obligations is controlled by the language of the contract. See Sims

v. Sperry, 835 P.2d 565, 571 (Colo. App. 1992) (“In accord with the

rules of contract interpretation, we look to the [contract] language

to determine the rights and obligations of the parties.”).

Interpretation of a contract is a question of law that we review de

novo. French v. Centura Health Corp., 2022 CO 20, ¶ 24 (citing Fed.

Deposit Ins. Corp. v. Fisher, 2013 COA 5 ¶ 9). In interpreting a

contract, our primary goal is to determine and give effect to the

parties’ intent. Id at ¶ 25.
2. Inspection Period

¶ 26 Elite attempts to explain and excuse its failure to timely close

on the contracts by arguing that Brennan did not deliver several

material documents. Based on these alleged failures, Elite argues

that it had the right to extend the closing date indefinitely and was

therefore not in breach of the PSA.

¶ 27 In contrast, Brennan argues that the timely objections Elite

made before the close of the inspection period and setting of the

closing date were adequately addressed. Brennan also argues that

the additional claims of non-delivery or breach asserted after the

closing date were pretextual attempts to excuse its failure to timely

close the purchase.

¶ 28 We address the parties’ specific contentions, and the trial

court’s findings with respect thereto, more fully below.

3. Billboard Contracts

¶ 29 Section 5(A)(1) of the PSA required Brennan to deliver to Elite

“fully executed copies of all storage contracts, [and] all other

contracts to include the billboard contracts.” Elite contends that

Brennan never provided fully executed copies of the leases between

Highway 85 and the company that owns the two billboards. It
argues that obtaining fully executed copies of the leases was a

material term of the PSA because they represented a material

amount of revenue for the storage business and property and that

signed leases would be critical to any action to enforce them.

¶ 30 Brennan counters that it was only obligated to produce that

which existed, that the income associated with the leases was not

material to the operation of the business, and that the lessor had

been paying rent pursuant to the lease for the previous three years.

Brennan also notes that Elite first raised the absence of signed

leases over a year after the scheduled closing and its filing of this

lawsuit. In short, Brennan argues that Elite raised the absence of

signed billboard leases as a pretext to justify its failure to timely

close on the contracts.

¶ 31 The trial court found Brennan leased the two billboards to an

advertising company, but that the leases provided minimal income.

The trial court also found Brennan provided the original lease that

it had in its possession at the time of delivery. Those documents

had Dan Brennan’s signature, but not a signature for the

representative from the advertising company.
¶ 32 The trial court found there was no evidence that fully executed

contracts had ever existed. The court also found that Elite never

objected to the billboard contract documents delivered, did not

notify Brennan that the leases were incomplete, or list the billboard

leases as a reason for its refusal to close.

¶ 33 We conclude that the trial court’s findings on this issue are

supported by the record and that its related legal conclusions were

correct. The lease agreements admitted at trial listed the annual

rent for each billboard as $1,875.00 and $3,000.00. Those

documents also clearly show only Dan Brennan’s signature on the

leases. Fully executed copies were not offered into evidence, and

the trial court heard no testimony that the lease agreements were

ever fully executed.

¶ 34 Based on this extensive record support, we perceive no error in

the trial court’s determination that Brennan’s failure to provide fully

executed lease agreements for the billboards was not a breach of

the contract or an excuse for Elite’s belated effort to extend the

contract closing date. See Gravina Siding & Windows Co. v.

Gravina, 2022 COA 50, ¶ 14 (“Whether a party has materially

breached a contract is a question of fact, and a court’s
determination of such a question may not be disturbed on appeal

unless it is so clearly erroneous as to find no support in the

record.”) (citation omitted).

4. Certificates of Occupancy

¶ 35 Section 5(A)(6) of the PSA required Brennan to deliver to Elite

fifteen categories of documents related to the property. Among

those deliverables were “copies to all certificates of occupancy (COs)

issued by governmental authorities for use or occupancy of the

property.” Elite argues that Brennan materially breached this

provision because it provided only one CO, when the public record

suggested that more than one existed. Brennan denies breaching

this delivery obligation and asserts that Elite waived any objection

to this requirement.

¶ 36 The trial court found that Brennan provided Elite the only CO

in its possession more than six months before the closing date. The

court also found that, in response to Elite’s initial objection, Dan

Brennan contacted the county to secure copies of other COs but

was unsuccessful. Brennan provided that information to Elite.

Calvin subsequently sent Brennan’s attorney an email stating that
he “called Weld County” and “they were able to give [him] what [he]

needed” for additional COs.

¶ 37 Based on this evidence, the trial court concluded that Brennan

substantially performed its obligation with respect to delivery of the

COs. The court also found that Brennan’s inability to provide any

additional COs was not material to Elite’s failure to close. Finally,

the court found that Elite, through its affirmative representation to

Brennan that the County had provided what Elite needed with

respect to the COs, waived any objection it may have once had with

respect to the CO issues.

¶ 38 Because these facts are supported by the record, we discern

no error in the trial court’s finding that Brennan fulfilled its delivery

obligation with respect to the COs. We also discern no error in the

court’s conclusion that if there ever was any basis for claiming

Brennan did not fulfill its obligations concerning the COs, any such

claim was waived by Elite’s affirmative representation that it had

what it needed. See, e.g., Richmond v. Grabowski, 781 P.2d 192,

194 (Colo. App. 1989) (“In contract, waiver as a matter of law may

occur when the contract establishes that an obligation by one party

is a condition precedent to that of the other, and it is undisputed
that the latter has proceeded in spite of the former’s failure to fulfill

the condition.”).

5. The Easement

¶ 39 At trial, Elite raised various arguments with respect to the

alternative access easement and whether the original legal

description in the PSA was ever properly amended. Elite argues

these issues provided additional grounds for extending the closing

date indefinitely. The trial court rejected these arguments for

various reasons.

¶ 40 On appeal, Elite argues in its opening brief that Brennan failed

to perform because Brennan renegotiated to relocate the access

easement to a different area on the property and conveyed the

former access easement to a third party. Based on those events,

Elite argued that Brennan no longer had the legal authority to sell

the property as defined under the PSA (which encompassed the

original easement and was not amended to include the renegotiated

easement). Elite’s argument on appeal is contained in one

paragraph near the end of its opening brief.

¶ 41 Elite’s opening brief provided no legal authority or explanation

of how this asserted omission materially impacted its ability to close
the purchase. Moreover, while attempting to discount the trial

court’s added factual findings regarding the access easement, Elite’s

reply brief affirmatively represents that it “has not raised the access

easement as an issue” on appeal. Since we do not review issues

that are not raised on appeal or otherwise fully developed, we do not

address this issue further. See, e.g., Woodbridge Condo. Ass’n v. Lo

Viento Blanco, LLC, 2020 COA 34, ¶ 41 n.12 (“We don’t consider

undeveloped and unsupported arguments.”), aff’d, 2021 CO 56.

C. Specific Performance and Affirmative Defenses

1. Specific Performance

¶ 42 Specific performance is a remedy potentially available when

there has been a material breach of a contract. Air Sols., Inc. v.

Spivey, 2023 COA 14, ¶ 48. The remedy is in lieu of a damage

award and is intended to place the parties in the position they

would have occupied if the contract had been fully performed. Id.

But specific performance is not an available remedy when there has

not been a material breach by the defending party. As discussed

above, we find no error in the trial court’s determination that

Brennan did not breach the PSA. Therefore, there is no basis for a

remedy, including specific performance.
2. Brennan’s Affirmative Defenses

¶ 43 An affirmative defense is “not merely a denial of an element of

a plaintiff’s claim, but rather it is a legal argument that a defendant

may assert to require the dismissal of a claim, notwithstanding the

plaintiff’s ability to prove the elements of that claim.” Soicher v.

State Farm Mut. Auto. Ins. Co., 2015 COA 46, ¶ 18. Thus, if all the

elements of a claim have not been proved, there is no need to

consider an affirmative defense. See State Farm Mut. Auto. Ins. Co.

v. Goddard, 2021 COA 15, ¶ 60.

¶ 44 Because the trial court did not err by finding and concluding

that Brennan did not breach the PSA, we need not consider Elite’s

affirmative defenses.

D. Attorney Fees

¶ 45 If attorney fees are recoverable for an appeal, the principal

brief of the party claiming attorney fees must include a specific

request, and explain the legal and factual basis, for an award of

attorney fees. C.A.R. 39.1.

¶ 46 Because Brennan is the prevailing party, it is entitled to

recover its attorney fees and related costs incurred on appeal

pursuant to the fee-shifting provision in the PSA. We reject Elite’s
request for attorney fees both because it was asserted for the first

time in its reply brief and because it is not the prevailing party on

appeal. Pinnacol Assurance v. Laughlin, 2023 COA 9, ¶ 22 (“[T]he

issue was raised for the first time in her reply brief, so it is not

properly before us.”); see C.A.R. 39. Because the trial court is

uniquely suited to undertake the fact finding necessary to

determine such an award, we exercise our discretion under C.A.R.

39.1 and C.A.R. 39(c)(1) and remand to the trial court to determine

and award Brennan its reasonable appellate attorney fees and

related costs.

III. Disposition

¶ 47 The judgment is affirmed, and the case is remanded to the

trial court to determine Brennan’s reasonable appellate attorney

fees and related costs.

JUDGE TOW and JUDGE PAWAR concur.