Bonati v. KDSW

23CA1943 Bonati v KDSW 10-17-2024

COLORADO COURT OF APPEALS

Court of Appeals No. 23CA1943
Jefferson County District Court No. 20CV30537
Honorable Diego G. Hunt, Judge

John E. Bonati; Charles A. Bonati, Jr.; and Crystal A. Bonati,

Plaintiffs-Appellees,

v.

KDSW Holdings, LLLP, a Colorado limited liability limited partnership; and
Keith V. Bonati,

Defendants-Appellants.

JUDGMENT AFFIRMED AND CASE
REMANDED WITH DIRECTIONS

Division II
Opinion by JUDGE SCHOCK
Fox and Johnson, JJ., concur

NOT PUBLISHED PURSUANT TO C.A.R. 35(e)
Announced October 17, 2024

Fennemore Craig, P.C., David M. “Merc” Pittinos, Allison M. Hester, Denver,
Colorado, for Plaintiffs-Appellees

Springer & Steinberg, P.C., Christopher S. Maciejewski, Denver, Colorado, for
Defendants-Appellants
¶1 Defendants, Keith V. Bonati and his entity KDSW Holdings,

LLLP (KDSW), appeal the judgment entered against them and in

favor of plaintiffs, John E. Bonati, Charles A. Bonati, Jr. (Charlie),

and Crystal A. Bonati, and cross-claim defendant, Charles A.

Bonati, Sr., and ordering the partition by sale of real property the

parties co-own. We affirm the judgment and remand the case to the

district court to award plaintiffs their reasonable attorney fees and

costs incurred on appeal in connection with their civil theft claim.

I. Background

¶2 This case stems from the Bonati family’s joint ownership of a

107-acre piece of unimproved land (the property). The property is

geographically diverse and lacks an access road, the previous road

having been destroyed by flooding years ago. A new road has since

been built, but the Bonatis have been unable to secure an easement

over that road, leaving the property accessible only by foot.

¶3 The property was previously owned by Charles,1 the patriarch

of the family. In 2003, Charles conveyed the property to his four

1 Because the parties in this case share the same last name, we

refer to them by their first names, intending no disrespect. We refer
to Charles A. Bonati, Sr., as Charles and Charles A. Bonati, Jr., as
Charlie, consistent with the names used in the parties’ briefs.

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sons — John, Charlie, Keith (through KDSW), and Scott Bonati —

as tenants in common, while reserving a life estate for himself.

After several transactions over the next two decades, the property is

currently owned in various percentages by Charlie, Crystal

(Charlie’s wife), John, and KDSW. In 2020, Charles conveyed his

life estate to those four owners, thus terminating the life estate.

¶4 When Charles conveyed the property to his sons in 2003, the

brothers discussed sharing the cost of taxes and other expenses

associated with the property. But they disagree about whether they

reached any agreement. John and Charlie testified at trial that the

brothers verbally agreed to pay the property taxes. Keith testified

that they did not. Either way, there was no written agreement.

¶5 Until 2012, the property taxes were low — approximately $200

per year — and Charles paid them. But in 2012, the annual taxes

increased to more than $13,000, and the brothers again discussed

sharing responsibility for the taxes. From that point on, one or

more of the brothers paid the taxes — but never on time. For the

next several years, the family repeatedly missed tax payments,

allowed the property to go to tax sales, and redeemed the tax liens.

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¶6 In 2015 and 2016, with taxes still owed for prior years, Keith

(through another entity he owned) purchased the tax liens on the

property, and John reimbursed him for half of the purchase price.

Charlie later paid Keith and John $25,000 each — Keith for past

due taxes and John for contemplated future improvements

necessary to sell the property. The plan was for the brothers to

acquire title to the property through a treasurer’s deed, secure a

road access easement, and then prepare the property for sale.

¶7 But before the treasurer’s deed was issued, Scott thwarted the

plan by unexpectedly redeeming the outstanding tax liens, which he

could do as a co-owner of the property. As the lienholder, Keith

received the redemption payments, which reimbursed him for the

amounts he had paid to purchase the liens. John and Charlie, in

turn, asked Keith to return the money they had paid him in

furtherance of the now-foiled plan. Keith refused to do so. He

maintained that the county had incorrectly allowed Scott to redeem

the liens, and once it realized its mistake, Keith would need the

money to repay Scott and move forward with the original plan.

¶8 With the brothers at an impasse, plaintiffs initiated this action

to partition the property by sale. Charlie and John also asserted

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claims against defendants for unjust enrichment, promissory

estoppel, and civil theft based on the money they had paid Keith

that Keith had not returned. Defendants asserted counterclaims

against plaintiffs and cross-claims against Charles, including for

(1) unjust enrichment for taxes and other expenses they had paid;

and (2) a partnership accounting under the Colorado Uniform

Partnership Act (1997), sections 7-64-401 to -405, C.R.S. 2024.

¶9 After a bench trial, the district court ruled for plaintiffs. As

relevant to this appeal, the district court (1) found that Charles was

not liable for property taxes as the owner of a life estate because the

brothers had agreed to pay the taxes; (2) ruled in favor of plaintiffs

on their claims of civil theft, promissory estoppel, and unjust

enrichment; (3) denied defendants’ partnership accounting claim

because the parties did not carry on a business for profit under

section 7-64-202(1), C.R.S. 2024; and (4) ordered the sale of the

property through a mutually agreeable real estate broker.

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II. Standard of Review

¶ 10 Our review of a judgment after a bench trial presents a mixed

question of fact and law. State ex rel. Weiser v. Ctr. for Excellence in

Higher Educ., Inc., 2023 CO 23, ¶ 33. We review the district court’s

factual findings for clear error and its legal conclusions de novo.

Kroesen v. Shenandoah Homeowners Ass’n, 2020 COA 31, ¶ 55.

¶ 11 In conducting this review, we defer to the district court’s

credibility determinations and its assessment of the weight and

probative effect of the evidence. Amos v. Aspen Alps 123, LLC, 2012

CO 46, ¶ 25; Saturn Sys., Inc. v. Militare, 252 P.3d 516, 521 (Colo.

App. 2011). We will not disturb its factual findings unless they are

clearly erroneous and unsupported by the record. Amos, ¶ 25.

III. Responsibility for Property Taxes

¶ 12 Relying on Dormer v. Walker, 69 P.2d 1049, 1051 (Colo. 1937),

defendants first argue that the district court erred by concluding

that Charles was not responsible for the property taxes during the

pendency of his life estate. In Dormer, the supreme court held that

“where the instrument creating the life estate is silent as to [the

payment of taxes], it is the duty of the owner of a life estate, who is

entitled to receive the rents, issues, and profits therefrom, to keep

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paid all current taxes and assessments.” Id. The district court held

that the rule in Dormer did not apply because (1) the property did

not generate any income or profits during the term of Charles’s life

estate, and (2) the brothers agreed to be responsible for the property

taxes after the 2003 conveyance. Because the record supports the

district court’s second rationale, we need not address the first.

¶ 13 Although Dormer sets forth a default rule, the parties may

agree to change that rule and allocate responsibility for taxes as

they choose. See Kendall v. Wiles, 483 P.2d 388, 389 (Colo. App.

1971) (noting parties’ agreement that owner of fee title, not owner of

life estate, would make all future mortgage, insurance, and tax

payments); cf. Robinson v. Tubbs, 344 P.2d 1080, 1081 (Colo. 1959)

(holding that “the ultimate criterion” for determining whether the

life tenant or remainderman is responsible for paying property taxes

is “the intention of the creator of these estates as determined from

the terms of the instrument creating them”) (citation omitted);

Dormer, 69 P.2d at 1051 (noting that obligation to pay taxes may

arise “under the terms of the agreement or by operation of law”).

¶ 14 The record supports the district court’s factual finding that the

brothers agreed that they — not Charles — would be responsible for

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paying property taxes after the 2003 conveyance. Both John and

Charlie testified that the brothers reached a verbal agreement in

2003 that they would pay the taxes. And at least after 2012, when

the taxes increased above a de minimis amount, the brothers acted

somewhat consistently with that agreement by, individually or

collectively, purchasing and redeeming the tax liens — albeit, after

failing to pay the taxes on time in the first place.

¶ 15 Indeed, before backtracking at trial, defendants themselves

acknowledged such an agreement. In their counterclaim and cross-

claim, defendants alleged that “[w]hen Charles Sr. conveyed the

Property to [the brothers], the parties intended that the transferees

would share equally in the responsibility for maintenance, taxes,

and other expenses.” And they sought a declaration that “the

owners of the remainder interests have an implied agreement to

share equally responsibility for taxes and costs of maintaining the

Property.” Thus, the district court’s ruling on this point was

consistent with defendants’ initial position and requested relief.

¶ 16 Defendants now dispute the existence of such an agreement,

characterizing John’s and Charlie’s testimony as self-serving and

contradictory. They urge us to instead credit Keith’s testimony that

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although the brothers discussed paying the property taxes, they

never reached an agreement. But it is the district court’s role, not

ours, to assess the credibility of witnesses and resolve conflicts in

the evidence. See Highlands Broadway, OPCO, LLC v. Barre Boss

LLC, 2023 COA 5, ¶ 26. The district court did so here and found

the testimony that there was a verbal agreement to be “credible.”

We must defer to that credibility finding. See Amos, ¶ 25.

¶ 17 Defendants cite other evidence in the record that could

support a contrary finding. For example, they note that Charles

paid the property taxes until 2012 and that, once he stopped, the

brothers never timely did so. They point to the lack of a written

agreement or any reference in the deed to the payment of taxes.

They highlight the lack of coordination and equal participation

among the brothers in redeeming the tax liens, including Charlie’s

failure to contribute to the taxes at all until 2018. And they assert

that the brothers’ inability to agree on anything concerning the

property undermines any suggestion that they could agree on this.

¶ 18 But these are all factual questions for the district court. We

may not reweigh the evidence and substitute our judgment. See

Owners Ins. Co. v. Dakota Station II Condo. Ass’n, 2021 COA 114,

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¶ 50. Rather, because there is record support for the district

court’s factual finding, we will not disturb it. See Amos, ¶ 25.

IV. Civil Theft, Unjust Enrichment, and Promissory Estoppel

¶ 19 Defendants next contend that the district court erred by ruling

in favor of plaintiffs on their claims for civil theft, unjust enrichment

and promissory estoppel, all arising out of Keith’s failure to return

the money John and Charlie paid him. We disagree.

¶ 20 Initially, we note that each of these claims concerns the same

sums of money and the same set of facts. With each, John and

Charlie sought the return of money they paid Keith for property

taxes and other expenses because Keith’s purchase of the tax liens

was reimbursed by another source (Scott’s redemption of the lien),

and the remaining funds were not used as intended. Thus, the

damages for the unjust enrichment and promissory estoppel claims

were subsumed in the damages for the civil theft claim (which

included treble damages), making any error as to those claims

harmless if the civil theft award is upheld. See Schuessler v. Wolter,

2012 COA 86, ¶ 63 (“A plaintiff generally may not receive a double

recovery for the same wrong.”). Regardless, we perceive no error.

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A. Civil Theft

¶ 21 Defendants assert that the district court clearly erred by

finding that they acted with the specific intent to permanently

deprive Charlie and John of the benefit of the money they paid him.

This is a factual question that we review for clear error. See In re

Estate of Chavez, 2022 COA 89M, ¶ 47; Amos, ¶ 25. We will uphold

the district court’s finding if it has record support. Amos, ¶ 25.

¶ 22 To prevail on a claim of civil theft, a plaintiff must prove two

elements: (1) the defendant knowingly obtained control over the

plaintiff’s property without authorization, and (2) the defendant did

so with the “specific intent to permanently deprive the plaintiff of

the benefit of the property.” Tisch v. Tisch, 2019 COA 41, ¶ 51; see

also §§ 18-4-401(1), -405, C.R.S. 2024. Defendants challenge only

the second element.

¶ 23 The district court found that Keith “intentionally took and

kept” the specified funds from John and Charlie, “intending to

permanently deprive them of those funds.” There is support in the

record for that finding. The evidence showed that John and Charlie

gave Keith money for a specific purpose — John for the purchase of

the tax liens and Charlie for taxes and other property expenses —

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as part of a plan to acquire a treasurer’s deed and sell the property.

Then, when Scott redeemed the tax liens, thwarting the plan and

reimbursing Keith for the amounts he had paid, John and Charlie

asked for their money back. But despite their repeated demands,

Keith refused. That fact alone supports a finding that Keith

intended to permanently deprive John and Charlie of those funds.

¶ 24 Defendants offer several alternative explanations as to why

they held onto the funds:

• Keith believed Scott’s redemption of the tax liens had

been untimely, and once the error was corrected, Keith

would be required to repay the redemption amount.

• Keith believed the funds could still be used as intended,

and John’s and Charlie’s demands for return of the funds

were contrary to their agreed-upon plan.

• Keith believed that Charlie owed him more in back taxes

than Charlie had paid him.

• Keith suffered a severe health crisis that caused him to

withdraw from family interactions around the time that

John and Charlie were demanding return of the funds.

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¶ 25 But at most, these alternative explanations merely offer

different reads of the evidence, or other findings the court could

have made. The district court’s factual finding is not clearly

erroneous just because the evidence might also have supported a

contrary finding. See Casserly v. State, 844 P.2d 1275, 1281 (Colo.

App. 1992) (“A court’s findings based upon a choice between two

plausible views of the weight of the evidence or upon a choice

between conflicting inferences from the evidence is not clearly

erroneous.”). Because the district court’s finding is supported by

the record, that finding is not clearly erroneous. See Amos, ¶ 25.

B. Unjust Enrichment

¶ 26 Defendants next argue that the district court (1) applied the

wrong legal test to the unjust enrichment claims and (2) abused its

discretion by finding in favor of Charlie and John on those claims.

¶ 27 A party claiming unjust enrichment must prove that “(1) the

defendant received a benefit (2) at the plaintiff’s expense (3) under

circumstances that would make it unjust for the defendant to retain

the benefit without commensurate compensation.” Lewis v. Lewis,

189 P.3d 1134, 1141 (Colo. 2008). In cases involving “failed

contracts between close family members or confidants,”

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malfeasance is not required. Id. at 1143. Rather, “when close

family members or confidants act with a mutual purpose, unjust

enrichment occurs when one party benefits from an action that is a

significant deviation from that mutual purpose.” Id.

¶ 28 Because unjust enrichment is an equitable remedy, we review

the district court’s ruling on an unjust enrichment claim for an

abuse of discretion. Id. at 1140-41. We review de novo whether the

district court correctly understood the appropriate test. Id. at 1141.

¶ 29 Defendants argue that the district court failed to apply the test

in Lewis. But they do not develop this argument. See Woodbridge

Condo. Ass’n v. Lo Viento Blanco, LLC, 2020 COA 34, ¶ 41 n.12

(declining to consider “undeveloped and unsupported arguments”),

aff’d, 2021 CO 56. They do not explain how the district court’s

analysis was inconsistent with Lewis. And to the extent they

suggest that Lewis’s “close family member” refinement of the third

unjust enrichment element should apply under the circumstances

of this case, they do not develop that point either. Lewis, 189 P.3d

at 1142. Nor did defendants preserve any Lewis-based arguments

in the district court. See Melat, Pressman & Higbie, L.L.P. v.

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Hannon L. Firm, L.L.C., 2012 CO 61, ¶ 18 (declining to address

unpreserved issues in a civil case).

¶ 30 In any event, although the district court did not expressly cite

Lewis or its elements, it effectively applied that test by finding that

(1) Keith received and retained money; (2) paid by John and Charlie;

(3) even though the parties’ plan for those funds had failed. To the

extent the Lewis test for “close family members” acting with a

“mutual purpose” applies, the district court’s findings further

establish that Keith “benefit[ted] from . . . a significant deviation

from that mutual purpose.” Lewis, 189 P.3d 1134. More

specifically, the court found that Keith kept the funds when they

could no longer be used for their intended purpose. And although

defendants argue that it was John and Charlie who deviated from

the parties’ mutual purpose by demanding the return of the funds,

that was a question of fact for the district court. See id. at 1144.

¶ 31 Because the district court applied the correct legal analysis

and its findings have record support, the court did not abuse its

discretion by finding that Keith had been unjustly enriched. See id.

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C. Promissory Estoppel

¶ 32 Defendants lump the promissory estoppel claim in with their

challenges to the civil theft and unjust enrichment claims, asserting

that the district court abused its discretion by ruling against them

on that claim as well. But they do not make any distinct argument

with respect to that claim, other than the conclusory assertion that

the parties’ conduct failed to satisfy the elements of such a claim.

See Barnett v. Elite Props. of Am., Inc., 252 P.3d 14, 19 (Colo. App.

2010) (“We will not consider a bald legal proposition presented

without argument or development.”). Even were we to consider this

undeveloped claim, we perceive no abuse of discretion. See La Plata

Med. Ctr. Assocs., Ltd. v. United Bank of Durango, 857 P.2d 410,

420 (Colo. 1993) (reviewing equitable claims for abuse of discretion).

¶ 33 A promissory estoppel claim has four elements: (1) the

promisor made a promise; (2) the promisor should have reasonably

expected that the promise would induce action or forbearance by

the promisee; (3) the promisee reasonably relied on the promise to

their detriment; and (4) the promise must be enforced to prevent

injustice. Cherokee Metro. Dist. v. Simpson, 148 P.3d 142, 151

(Colo. 2006).

15
¶ 34 The district court correctly cited this test and made findings

sufficient to satisfy the elements of that claim, albeit not in the

terminology of the test. See Foster v. Phillips, 6 P.3d 791, 796 (Colo.

App. 1999) (noting that findings may be implicit in a court’s ruling).

The evidence described above provides record support for each of

those elements: (1) Keith told John and Charlie he would use their

money to purchase the tax liens and pay property taxes so the

brothers could acquire a treasurer’s deed and sell the property;

(2) Keith should have reasonably expected that promise to induce

John and Charlie to send him the money; (3) John and Charlie

reasonably relied on the promise by sending Keith money; and

(4) Keith did not ultimately use the money for the promised

purpose. Again, any challenges defendants make to these elements

go to the weight of the evidence. See Saturn Sys., 252 P.3d at 521.

V. Business For Profit

¶ 35 Defendants next argue that the district court erred by finding

that the parties did not carry on a “business for profit,” as

necessary to form a partnership under section 7-64-202(1). They

assert that the brothers engaged in a “business for profit” by paying

16
back taxes and agreeing to share in future expenses for the purpose

of eventually selling the property for a profit. We disagree.

¶ 36 A partnership is an “association of two or more persons to

carry on as co-owners a business for profit.” § 7-64-202(1). A

“[b]usiness” is any “trade, occupation, and profession.” § 7-64-

101(2), C.R.S. 2024. Joint ownership of property “does not by itself

establish a partnership, even if the co-owners share profits made by

the use of the property.” § 7-64-202(3)(a); see also Brown v. Miller,

141 P.2d 682, 684 (Colo. 1943) (“[M]ere joint ownership of land does

not establish a partnership even though profits are shared . . . .”).

¶ 37 The existence of a partnership is a question of fact. Reid v.

Pyle, 51 P.3d 1064, 1067 (Colo. App. 2002). We thus review the

court’s factual findings for clear error and will not disturb them if

they have record support. Id. Whether those facts establish a

partnership is a question of law that we review de novo. Id.

¶ 38 We agree with the district court that the parties’ efforts to

preserve their title to the property so they could someday sell it does

not constitute a business for profit. First, the property was not

used for a “trade, occupation, or profession.” § 7-64-101. Rather,

the district court found, with record support, that the property was

17
“primarily used for recreation” and generated no income. Second,

the mere act of holding a single piece of property for future sale —

and paying property taxes — is not a business. Most property

owners hope to one day sell their property for a profit and know

they must pay taxes in the meantime. That does not, without more,

make property ownership a business. See § 7-64-202(3)(a).

¶ 39 We acknowledge that there was some evidence of

coordination — or at least attempts at coordination — among the

brothers. But the focus of that coordination was primarily confined

to taking care of the back taxes so the family did not lose the

property. Other than some unfruitful discussions about

purchasing an access easement, there was no evidence of any other

shared expenses. Cf. Yoder v. Hooper, 695 P.2d 1182, 1187 (Colo.

App. 1984) (noting that parties contributed an equal amount and

intended to share equally in the responsibilities of the partnership),

aff’d, 737 P.2d 852 (Colo. 1987). The district court found that the

brothers did not agree to divide maintenance costs and that any

work Keith performed on the property was “gratuitous and not

compensable.” To the extent the brothers anticipated sharing in

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future profits from the sale of the property, that was not so much

an agreement as it was a consequence of their joint ownership.

¶ 40 In short, the facts found by the district court establish little

more than that the brothers received property from their father and

took the minimum steps necessary to retain it. The district court

did not err by concluding that was not a business for profit.

VI. Partition Sale

¶ 41 Defendants’ final argument is that the district court abused its

discretion by ordering the partition sale to proceed through a real

estate broker. Their primary argument appears to be that such a

sale is not a “public sale” within the meaning of section 38-28-107,

C.R.S. 2024, and thus, was not authorized by statute. We disagree.

¶ 42 Section 38-28-107 provides that “[i]f the commissioners report

and the court finds that partition of the property cannot be made

without manifest prejudice to the rights of any interested party, the

court may direct the sale of such property at public sale upon such

terms as the court may fix.” In doing so, the court “may make such

orders as it may deem necessary to promote the ends of justice to

completely adjudicate every question and controversy concerning”

the rights and interests in the property. § 38-28-110, C.R.S. 2024.

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¶ 43 In ordering a partition by sale, the district court expressly

rejected plaintiffs’ argument that the sale should be private.

Instead, the court ordered that “the sale is to be public — that is,

not restric[t]ing the parties, their family members, or associates

related to these proceedings from participating in the sale.” To the

extent defendants assert that a sale through a real estate broker,

open to any member of the public, is not a “public sale,” they do not

develop that argument or cite any authority to support it. See

Woodbridge Condo. Ass’n, ¶ 41 n.12; see also 59A Am. Jur. 2d

Partition § 125, Westlaw (database updated Aug. 2024) (contrasting

“public sale” with “private sale,” which is “confined to the parties”).

¶ 44 Moreover, the district court has discretion to fix the terms of

the sale, see § 38-28-107, and to “make such orders as it may deem

necessary to promote the ends of justice,” § 38-28-110. The district

court found that a sale through a real estate broker was necessary

to “maximiz[e] the sale price of the Property and to prevent the

Bonati family members from using a sheriff’s sale as a weapon in

their ongoing dispute.” Given the well-established acrimony among

the family, that was a reasonable exercise of the court’s discretion.

20
¶ 45 Defendants make cursory references to other claimed

deficiencies in the district court’s order, including the failure to

appoint a commissioner and the grant of powers to the real estate

broker beyond those authorized by statute. But they make no

argument on these points. We decline to address an issue

presented without argument. See Barnett, 252 P.3d at 19. We also

will not address arguments raised for the first time in the reply

brief. People v. Czemerynski, 786 P.2d 1100, 1107 (Colo. 1990),

abrogated on other grounds by Rojas v. People, 2022 CO 8.

VII. Attorney Fees

¶ 46 Plaintiffs request an award of their appellate attorney fees and

costs in connection with their civil theft claim under section 18-4-

405. Because we affirm the district court’s finding of civil theft, we

grant this request. See Black v. Black, 2018 COA 7, ¶ 130. We

exercise our discretion under C.A.R. 39.1 to remand the case to the

district court to determine and award plaintiffs their reasonable

appellate attorney fees as related to the civil theft claim only.

¶ 47 We deny plaintiffs’ request for appellate attorney fees under

section 13-17-102(2), C.R.S. 2024. Although defendants did not

prevail, we do not view their arguments as so lacking in substantial

21
justification as to warrant an attorney fee award under that statute.

See In re Marriage of Boettcher, 2018 COA 34, ¶ 38 (“Fees should be

awarded only in clear and unequivocal cases when the appellant

presents no rational argument, or the appeal is prosecuted for the

purpose of harassment or delay.”), aff’d, 2019 CO 81.

VIII. Disposition

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

district court to award plaintiffs their reasonable attorney fees and

costs incurred on appeal in connection with their civil theft claim.

JUDGE FOX and JUDGE JOHNSON concur.

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