Free Proposed Jury Instructions - District Court of Colorado - Colorado

Case 1:01-cv-01857-RPM-MJW

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Filed 08/18/2006

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No. 01-cv-01857-RPM-MJW ATTORNEYS TITLE GUARANTY FUND, INC. as successor in interest and assignee of Joseph H. Fallon, IV Plaintiff, v. PROLAND MANAGEMENT, LLC; CRAIG NELSON; TOM WARNES; and ROBERT R. SURLES, Defendants. DEFENDANTS PROPOSED JURY INSTRUCTIONS Defendants Proland Management, LLC, Craig Nelson and Tom Warnes (collectively "Defendants"), through their respective counsel submit the following Proposed Jury Instructions, in addition to the Stipulated Jury Instructions to be submitted separately by Plaintiff's counsel, by agreement. Dated: August 18, 2006 Respectfully submitted, THOMAS F. QUINN, P.C. s/ Thomas F. Quinn By: ______________________________________ Thomas F. Quinn 1600 Broadway Ste 2350 Denver CO 80202 Telephone: 303.832.4355 Fax: 303.672.8281 Email: [email protected] Counsel for Defendants Craig Nelson

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Tom Warnes and Proland Management LLC

CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the foregoing pleading was served upon the following persons by electronic transmission through the ECF filing system on this 18th day of August, 2006: BALDWIN & CARPENTER Stacy A. Carpenter, Esq. [email protected] s/ Theresa J. Sheffer __________________________________________

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DEFENDANTS PROPOSED INSTRUCTION NO. 1 I will now explain the claims of each party to the case and law governing the case. Please pay close attention to these instructions. You must all agree on your verdict, applying the law, as you are now instructed, to the facts as you find them to be. The parties to this case are: Attorneys Title Guaranty Fund, Inc., the plaintiff, and Proland Management, LLC, Craig Nelson, and Tom Warnes, the defendants. The plaintiff, Attorneys Title Guaranty Fund claims that on June 27, 2001, Dr. Joseph H. Fallon loaned defendant Proland Management, LLC $616,000. As part of the loan transaction, Proland Management signed an Promissory Note. By signing the Promissory Note, Proland Management agreed to repay the loan to Dr. Fallon according to the terms contained in the Promissory Note. Craig Nelson and Tom Warnes, members of Proland Management, also personally guaranteed the repayment of the loan to Dr. Fallon. That is, Mr. Nelson and Mr. Warnes agreed that if Proland Management did not repay the loan according to the terms in the Promissory Note, they would personally repay the loan. As part of the loan transaction, Proland Management issued a Deed of Trust. The Deed of Trust transferred title to approximately 231 acres of real property in Gilpin County, Colorado from Proland Management to a trustee and secured the repayment of the loan to Dr. Fallon. The defendants failed to pay the loan to Dr. Fallon. On December 15, 2003, Dr. Fallon foreclosed on the Gilpin County Property that secured the repayment of the loan. Dr. Fallon's bid at foreclosure for the Gilpin County Property on March 11, 2004 was $555,639, which amount was less than the unpaid amount of the Promissory Note on that date. March 11, 2004

is the foreclosure date. As a result of that foreclosure, Dr. Fallon acquired title to the Glipin

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County Property for the sum of $555,639. This action is to determine the amount, if any, that the defendants remain obligated to pay under the Promissory Note.. As part of an unrelated lawsuit, Dr. Fallon assigned his interest in the Gilipin County Property and the Promissory Note to Attorneys Title. Under the terms of that assignment, any claim or defense which defendants might have asserted against Dr. Fallon is equally good as a claim or defense against Attorneys Title. Attorneys Title, as the assignee of Dr. Fallon, claim as its damages: (1) the difference between the amount that defendants' owed Dr. Fallon in principal and interest under the terms of the Promissory Note at the time of the foreclosure and Dr. Fallon's bid amount in the foreclosure; and (2) other expenses spent to complete the foreclosure. If you determine that Dr. Fallon's bid at the foreclosure sale was a good faith bid, that is the amount you should award to plaintiff as its damages. The defendants claim that Dr. Fallon's bid at the foreclosure sale was less than the fair market value of the property, and that the bid made by Dr. Fallon was not a good faith estimate of the fair market value of the Gilpin County Property. If you determine that the bid was not a

good faith estimate of the value of the property, you must determine the actual fair market value of the property on the foreclosure date and treat that amount as a credit on the note with the same effect as if a payment in that amount had been made in that amount on the foreclosure date. This may reduce, or possibly eliminate, any right that plaintiff may have to damages.

Source: CJI-Civ. 4th 2:5 (1999); Denver United States Nat'l. Bank v. Asbell Bros. Const., 294 F.2d 289, 290 (10th Cir. 1961); Court's Orders of March 15, 2006 and August 10, 2006.

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DEFENDANTS' PROPOSED INSTRUCTION NO.2 The foreclosure bid of Dr. Fallon would not be made in good faith if the bid was is unreasonable or based upon mistaken facts which Dr. Fallon may honestly have believed to be true.

Authority: Richards Engineers, Inc. v. Spanel, 745 P.2d 1031, 1033 (Colo. Ct. App. 1987).

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DEFENDANTS' PROPOSED INSTRUCTION NO. 3 In determining the fair market value of the Gilpin County Property you should consider the most advantageous use or uses to which the property might reasonable and lawfully be put in the future by persons of ordinary prudence and judgment. Such evidence may be considered, however, only insofar as it assists you in determining the market value of the property as of the date of valuation. It may not be considered for the purpose of allowing any speculative value.

Source: C.J.I 36:6, State Department of Highways v Schulhoff , 167 Colo 72, 445 P.2d 402 (1968), State Department of Highways v. Mahaffey, 697 P2d 773 (Colo. App. 1984)

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DEFENDANTS' PROPOSED INSTRUCTION NO. 4 An owner of real property may state his opinion regarding the value of his real property. Mr. Warnes and Mr. Nelson have testified as to the value of the Gilpin County property as of the date of the foreclosure bid. You should judge such testimony just as you would judge any other testimony. You may accept it or reject it, in whole or in part. You should give the testimony the importance you think it deserves, considering the witness's qualifications, the reasons for the opinions, and all of the other evidence in the case.

Source: CJI-Civ. 4th 3:15 (1999).

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DEFENDANTS' PROPOSED INSTRUCTION NO. 5 This Court has already determined that defendants are liable to Attorneys Title for the balance of the Promissory Note, if any balance exists. Consequently, you must award Attorneys Title the amount, if any, that is due and owning on the Promissory Note. To award actual damages, you must find the balance of the Promissory Note by a preponderance of the evidence If you find that there is no balance owing on the Promissory Note, you must enter a verdict for defendants.

Source: CJI-Civ. 4th 30:33 (2003) (modified in accordance with the Court's March 15, 2006 Order).

Case 1:01-cv-01857-RPM-MJW

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DEFENDANTS' PROPOSED INSTRUCTION NO. 6 If you find that defendants established that Dr. Fallon's bid was not based on his good faith estimate of the fair market value of the Gilpin County property, you must determine the actual fair market value of the Gilpin County property on the date of the foreclosure bid. Your award as damages must be equal to the amount, if any, by which the balance of the promissory note, plus Dr. Fallon's foreclosure costs, on the foreclosure date exceeded the actual fair market value of the property on that date.

Source: Bank of America v. Kosovich, 878 P.2d 65,67-8 (Colo. App. 1994).

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DEFENDANTS' PROPOSED INSTRUCTION NO. 7 The price paid for a property at a foreclosure sale is not evidence of the fair market value of the property.

Authority: CJI 36:3; sales at foreclosure are not sales where neither party is under a compulsion to sell.