Chapter 18 - § 18.3 • ATTORNEY FEES UNDER C.R.S. § 13-17-102

• Jurisdiction: Colorado

§ 18.3 • ATTORNEY FEES UNDER C.R.S. § 13-17-102

There are approximately two hundred statutes that permit a court to award attorney fees.²⁹ While this book does not address each of these specific statutes, it does address recovering attorney fees under C.R.S. § 13-17-102 and Rules 11 and 37 of the Colorado Rules of Civil Procedure.

Colorado has long had a statute that penalizes those who bring frivolous civil litigation.³⁰ The legislature amended this statute in 1984 and 1986, and it currently provides that a court shall assess attorney fees if it determines that an attorney or party brought or defended an action, or any part of an action, that "lacked substantial justification."³¹ The statute defines the term "lacked substantial justification" as "substantially frivolous, substantially groundless, or substantially vexatious."³² Also included under the statute are situations in which the action was undertaken for delay or harassment, an attorney or party unnecessarily expanded the proceeding by other improper conduct including abuses of discovery procedures, or in which a defending party made a designation of a nonparty that lacked substantial justification.³³

Litigants can assert this statute in any civil action commenced or appealed in any court of record,³⁴ except traffic offenses, matters brought under the provisions of the Colorado Children's Code, juvenile matters, or matters involving violations of municipal ordinances.³⁵ If multiple statutes permit the awarding of attorney fees, the court should apply the statute that allows the greater award.³⁶

A claim is "frivolous" if the litigant presents no rational argument based on evidence or law³⁷ and is "groundless" if the allegations in the claim are not supported by any credible evidence,³⁸ even if the complaint survives a motion to dismiss for failure to state a claim.³⁹ A claim is "vexatious" if it is brought in bad faith.⁴⁰ Simply because a party adopts a losing position does not necessarily mean it is groundless.

In 1983, the Colorado Court of Appeals held that a claim was neither frivolous nor groundless despite the fact that before filing a quiet title action, the plaintiff landowners possessed two surveys indicating that defendants rightfully possessed the disputed tract. Plaintiffs were aware of the legal description of the defendants' parcel and knew that no permanent fences or monuments that could give defendants notice of plaintiffs' claim were ever erected.⁴¹ The court held that, because it was not shown that plaintiffs lacked an honest uncertainty about the location of the boundary, an award of attorney fees would be improper.⁴²

When a court determines that a claim or defense lacked substantial justification, the court must state the reason for the finding.⁴³ When determining whether to assess attorney fees, and if so, how much to...