COLORADO COURT OF APPEALS 2017COA44

Court of Appeals No. 15CA2132 

Elbert County District Court No. 13CV30038 

Honorable Michael J. Spear, Judge 

International Network, Inc., a Colorado corporation, 

Plaintiff-Appellee, 

v. 

Michael W. Woodard, 

Defendant-Appellant. 

JUDGMENT AFFIRMED AND CASE 

REMANDED WITH DIRECTIONS 

Division III 

Opinion by JUDGE CASEBOLT* 

Webb and Nieto*, JJ., concur 

Announced April 6, 2017 

Reynolds Gillette LLC, Brian R. Reynolds, Patrick Gillette, Denver, Colorado, for 

Plaintiff-Appellee 

Richard J. Banta, P.C., Richard J. Banta, Denver, Colorado; Robinson Waters 

& O’Dorisio, P.C., Tracy L. Ashmore, Denver, Colorado, for Defendant-Appellant 

*Sitting by assignment of the Chief Justice under provisions of Colo. Const. art. 

VI, § 5(3), and § 24-51-1105, C.R.S. 2016. 
1 

¶ 1 This case involves the admitted breach of a clause contained 

in an exclusive right-to-sell real estate listing agreement obligating 

the seller to “conduct all negotiations for the sale of the property 

only through Broker, and to refer to Broker all communications 

received in any form from . . . prospective buyers . . . or any other 

source” (referral provision). Defendant, Michael W. Woodard 

(seller), appeals the judgment in favor of plaintiff, International 

Network, Inc., the real estate broker (broker), in the amount of the 

commission that would have been payable under the listing 

agreement had seller not breached the above-quoted clause. We 

affirm. 

I. Background 

¶ 2 In April 2006, seller, who owned a ranch consisting of 

approximately 100 acres, signed an exclusive right-to-sell listing 

agreement with broker. As pertinent here, the agreement 

established a list price of $4.5 million and provided for a percentage 

commission to be paid to broker upon sale. The parties agreed to a 

six-month listing period, but seller could cancel the agreement at 

any time upon written notice. 
2 

¶ 3 Approximately four months into the listing period, seller began 

negotiating with an attorney who represented a group of potential 

buyers. Seller did not disclose his negotiations to broker and 

admitted at trial that he had intentionally concealed the 

discussions to avoid payment of a commission. 

¶ 4 About a month after negotiations started, seller cancelled the 

listing agreement without providing a reason. Broker ceased any 

sales activity concerning the property. After the listing period had 

expired, but within a ninety-day holdover period set forth in the 

agreement, seller and the buyers finalized an agreement, resulting 

in the sale of the property for $3.6 million. 

¶ 5 Almost seven years later, broker initiated this action against 

seller for breach of contract based upon seller’s failure to comply 

with the referral provision. 

¶ 6 Following trial, a jury found in favor of broker and awarded 

$252,000 in damages — the commission that would have been 

owed under the listing agreement. 

II. Statute of Limitations 

¶ 7 Seller contends that the trial court erred in denying his motion 

for directed verdict and his post-trial motion for judgment 
3 

notwithstanding the verdict because broker’s breach of contract 

claim was barred by the statute of limitations. We disagree. 

A. Standard of Review 

¶ 8 We review de novo a trial court’s rulings on motions for 

directed verdict and judgment notwithstanding the verdict. Hawg 

Tools, LLC v. Newsco Int’l Energy Servs., Inc., 2016 COA 176M, ¶ 18. 

When the motion concerns a factual matter, we view the evidence in 

the light most favorable to the nonmoving party and draw all 

reasonable inferences from the evidence in that party’s favor. Hall 

v. Frankel, 190 P.3d 852, 862 (Colo. App. 2008). Such motions 

should be granted only when the evidence “compels the conclusion 

that reasonable jurors could not disagree and that no evidence or 

inference therefrom had been received at trial upon which a verdict 

against the moving party could be sustained.” Boulders at 

Escalante LLC v. Otten Johnson Robinson Neff & Ragonetti PC, 2015 

COA 85, ¶ 19. 

B. Applicable Law 

¶ 9 A breach of contract claim “shall be commenced within three 

years after the cause of action accrues.” § 13-80-101(1)(a), C.R.S. 

2016. In this context, a cause of action accrues “on the date the 
4 

breach is discovered or should have been discovered by the exercise 

of reasonable diligence.” § 13-80-108(6), C.R.S. 2016. 

¶ 10 The cause of action is discovered when the party obtains 

knowledge of the facts essential to the claim, not knowledge of the 

legal theory supporting it. Murry v. GuideOne Specialty Mut. Ins. 

Co., 194 P.3d 489, 492 (Colo. App. 2008). Such knowledge includes 

information that would lead a reasonable person to inquire further. 

Id. 

¶ 11 When a claim accrues and whether it is barred by the statute 

of limitations are generally questions of fact for the jury to resolve. 

Sterenbuch v. Goss, 266 P.3d 428, 432 (Colo. App. 2011). But 

“when the material facts are undisputed and reasonable persons 

could not disagree about their import, these questions may be 

decided as a matter of law.” Id. 

C. Analysis 

¶ 12 It is undisputed that seller breached the referral provision in 

2006. But the date when broker discovered or should have 

discovered seller’s breach is not so clear cut. 

¶ 13 Seller argued at trial that the abrupt manner in which he 

cancelled the listing agreement, the circumstances surrounding the 
5 

cancellation, and the recording of a deed transferring the property a 

few months later gave rise to a duty on broker’s part to inquire 

further into the sale. Upon broker’s investigation, seller asserted it 

would have discovered the facts essential to its claim. Thus, the 

argument proceeded, through the exercise of reasonable diligence, 

broker should have discovered the breach of contract in 2006, and 

because broker filed this action more than seven years later, the 

statute of limitations barred its claim. 

¶ 14 Broker agreed that seller cancelled the listing agreement in 

2006. But it asserted that this cancellation provided no indication 

that seller had been negotiating with the buyers in violation of the 

agreement. Instead, broker asserted that it had no knowledge of 

seller’s actions until 2011, when broker’s agent heard seller’s 

testimony in another lawsuit. In that case, seller testified that he 

had negotiated the sale of his property with the buyers’ attorney in 

violation of the listing agreement and that he had intentionally 

concealed this negotiation from broker to avoid paying a 

commission. According to the agent, only upon hearing this 

testimony did he discover seller’s breach. The agent also testified 

that, before hearing such testimony, he did not have any knowledge 
6 

or suspicion that seller had breached the agreement. Broker 

therefore asserted that its commencement of this action in 2013, 

within three years of its discovery of the breach, was timely. 

¶ 15 These arguments were presented to the jury, and it rejected 

seller’s statute of limitations defense. Based upon the record, we 

cannot conclude that the evidence — viewed in the light most 

favorable to broker — compels a different result. 

¶ 16 Seller had the absolute right to terminate the listing agreement 

at any time. Hence, the cancellation some four months into the 

six-month period did not, contrary to seller’s contention, place 

broker on notice of a potential claim as a matter of law. And 

contrary to seller’s additional contention, the recording of the deed 

conveying the property, by itself, did not put broker on notice of the 

facts essential to its cause of action or reasonably alert broker of 

the need to inquire further as a matter of law. 

¶ 17 To be sure, the recording of the deed provides notice to “all 

persons . . . claiming any interest in [the] property.” 

§ 38-35-106(1), C.R.S. 2016. But broker never claimed an interest 

in the property. Instead, it claimed a right to recover damages from 

seller’s breach of the listing agreement. 
7 

¶ 18 Seller also points to nothing within the recorded deed that 

would have alerted broker that seller had engaged in negotiations 

with the buyers in violation of the listing agreement. At most, the 

deed evidenced the sale of property a few months after the listing 

had expired, which discloses nothing of the facts essential to 

broker’s breach of contract claim. And it did not name the potential 

purchaser broker had identified under the holdover provision. 

¶ 19 We acknowledge the testimony of broker’s agent that could be 

viewed as conflicting with broker’s position. The agent testified that 

he had previously represented sellers who had gone behind his 

back on transactions; that he had been involved in previous 

disputes over real estate commissions; that seller refused to 

communicate with him after terminating the listing agreement; that 

he had seldom been fired from a listing agreement; and that he had 

accused seller, in a phone message, of going behind his back with a 

different potential purchaser, whom broker identified to seller’s 

attorney under the ninety-day holdover provision of the listing 

agreement. The agent also agreed that the sale of this property 

would have earned him a large commission. Finally, the agent 

stated that, after he received a letter from seller’s attorney 
8 

reiterating that the listing was cancelled and directing broker to 

communicate only with the attorney, he voluntarily “walked away” 

from the commission. 

¶ 20 But this evidence merely created conflicts in the facts for the 

jury to consider in light of the agent’s testimony that he did not 

have any knowledge or suspicion that seller had negotiated with the 

ultimate buyers during the term of the listing. In our view, 

reasonable jurors could disagree about the effect of all the record 

evidence, and there is sufficient evidence or inferences therefrom 

upon which a verdict against seller may be sustained. 

¶ 21 We therefore cannot conclude that the material facts regarding 

broker’s discovery of the breach compel overturning the jury’s 

verdict. Accordingly, the court did not err in denying seller’s 

motions for directed verdict and judgment notwithstanding the 

verdict based on the statute of limitations. 

¶ 22 Seller argues for the first time on appeal that the court erred 

by shifting the burden of proof concerning the statute of limitations 

defense to him. Because this issue was not raised in the trial court, 

we decline to address it. See JW Constr. Co. v. Elliot, 253 P.3d 

1265, 1271 (Colo. App. 2011) (an appellate court will not address 
9 

for the first time on appeal an issue not raised in or decided by the 

trial court); see also Robinson v. Colo. State Lottery Div., 179 P.3d 

998, 1108 (Colo. 2008). 

III. Jury Instructions 

¶ 23 Seller contends that the court erred in refusing his tendered 

jury instructions on (1) the elements of liability for a real estate 

commission claim and (2) the defense of laches. We consider and 

reject each contention in turn. 

A. Standard of Review 

¶ 24 We review jury instructions de novo to determine whether the 

instructions as a whole accurately informed the jury of the 

governing law. Nibert v. Geico Cas. Co., 2017 COA 23, ¶ 8. If they 

did, we review the trial court’s decision to give or reject a particular 

jury instruction for an abuse of discretion. Id. A court abuses its 

discretion when it misconstrues or misapplies the law, or when its 

decision is manifestly arbitrary, unreasonable, or unfair. Id.

B. Real Estate Commission 

¶ 25 Seller tendered a jury instruction setting forth the elements of 

liability for recovery on a real estate commission claim. He argued 

that the instruction was appropriate because broker could only 
10 

recover a commission if it was the procuring cause of the property’s 

sale. Tracking the model jury instruction, the tendered instruction 

stated the following: 

For [broker] . . . to recover from [seller] . . . on 

its claim to recover a real estate commission, 

you must find all of the following have been 

proved by a preponderance of the evidence: 

1. [Broker] held a valid license as a real estate 

broker under the laws of Colorado; 

2. [Broker], acting as a real estate broker, 

entered into a listing agreement with [seller] to 

sell [seller’s] property; 

3. [Broker] produced a purchaser who was 

ready, willing and able to complete the 

purchase of the property according to the 

terms of the listing agreement; and 

4. The sale of the property was completed 

between [seller] and the purchaser or 

prevented by [seller’s] refusal or neglect to 

complete the sale. 

See CJI-Civ. 4th 30:56 (2016). 

¶ 26 The court rejected the instruction, concluding that it was 

“based upon the right that a broker has to receive a commission,” 

but that it was not applicable in this case because seller’s asserted 

breach of the referral provision “interfere[d] with the broker’s ability 

to be a procuring agent.” Seller argues that by failing to provide the 
11 

real estate commission instruction, the court erroneously instructed 

the jury on the law. We disagree. 

¶ 27 Absent circumstances not present in this case, the general 

rule in Colorado is that a real estate broker is entitled to a 

commission on the sale of a property only when the broker 

produces a buyer who is ready, willing, and able to purchase the 

property on the seller’s terms. § 12-61-201, C.R.S. 2016; see 

Telluride Real Estate Co. v. Penthouse Affiliates, LLC, 996 P.2d 151, 

153 (Colo. App. 1999). That is, the broker must be the procuring 

cause of the sale. To be the procuring cause, the broker is required 

to set in motion a continuous chain of events that results in the 

sale of the property. Telluride Real Estate, 996 P.2d at 153. 

¶ 28 Other divisions of this court have recognized an exception to 

this general rule when the buyer and seller intentionally exclude the 

broker from the property sale. See id.; Winston Fin. Grp., Inc. v. 

Fults Mgmt., Inc., 872 P.2d 1356, 1358 (Colo. App. 1994). Under 

these circumstances, the seller may not defend on the basis that 

the broker was not the procuring cause. Telluride Real Estate, 996 

P.2d at 153; Winston Fin. Grp., 872 P.2d at 1358; see generally Reid 

v. Pyle, 51 P.3d 1064, 1067 (Colo. App. 2002) (a contracting party 
12 

who causes the other party’s failure to comply with the contract 

terms cannot take advantage of that failure). When this exception 

has been previously considered, however, the broker had at least 

some part in identifying the potential buyer before the broker’s later 

exclusion from the sale. Telluride Real Estate, 996 P.2d at 153; 

Winston Fin. Grp., 872 P.2d at 1357. 

¶ 29 The parties do not point to a Colorado case — nor have we 

found one — that has considered the effect of the procuring cause 

requirement when the broker had no contact with and was 

completely unaware of a potential buyer who commenced 

negotiations with the seller during the term of an exclusive listing 

agreement containing a referral clause and later purchased the 

listed property. 

¶ 30 Other jurisdictions faced with this question generally agree 

that the seller’s breach of the referral clause of an exclusive rightto-sell agreement during the listing period entitles the broker to the 

commission based on the subsequent sale of the property. See 

Hammond v. C.I.T. Fin. Corp., 203 F.2d 705, 709 (2d Cir. 1953) (the 

defendant’s failure to refer the buyer to the broker breached the 

listing agreement and thus entitled the broker to a commission);
13 

Kislak Co. v. Geldzahler, 509 A.2d 320, 326 (N.J. Super. Ct. Law 

Div. 1985) (“The appropriate measure of damages for breach of a 

term requiring referral of all inquiries to the listing broker, which is 

part and parcel of the exclusive agreement[,] is the stipulated 

commission in that agreement.”); E & E Mining, Inc. v. Flying D Grp., 

Inc., 718 P.2d 58, 62-63 (Wyo. 1986) (upholding the broker’s 

recovery of the property sale’s commission as damages for the 

seller’s breach of the referral obligation in their listing agreement); 

accord Van Schaack Land Co. v. Hub & Spoke Ranch Co., 244 F. 

Supp. 2d 1231, 1249 (D. Kan. 2003); see also J.C. Nichols Co. v. 

Osborn, 12 F. Supp. 2d 1196, 1201 (D. Kan. 1998) (“[E]very court 

that has considered the issue has ruled that . . . , where the seller 

has breached a referral provision and then sold the property 

without the broker, the seller’s breach entitles the broker to the 

commission set out in the agreement.”). 

¶ 31 We agree with these conclusions and apply the rule to this 

case. When the seller’s intentional concealment of the buyer, in 

clear violation of the referral provision of the listing agreement, 

precludes the broker from engaging with the buyer, the seller may 

not employ the procuring cause requirement to prevent the broker 
14 

from recovering the commission as damages on its breach of 

contract claim. 

¶ 32 In this case, seller admitted at trial that he contacted and 

negotiated with the buyers’ attorney during the term of the listing 

agreement, intentionally concealed his discussions from broker, 

and ultimately sold the property during the ninety-day holdover 

period set forth in the listing agreement. Seller’s conduct was in 

direct violation of the referral provision. 

¶ 33 Furthermore, broker did not contend that it was the procuring 

cause of the sale, nor did it assert that it was entitled to a 

commission it had earned through the sale of the property. Rather, 

it claimed seller breached the referral provision, and because of this 

breach, broker was prevented from procuring the sale. 

¶ 34 Seller cannot use his intentional concealment of his 

negotiation with the buyers to prevent broker from obtaining 

damages in the form of a commission. A real estate broker is 

considered an expert in the negotiation and sale of real estate. Doll 

v. Thornhill, 6 So. 2d 793, 795 (La. Ct. App. 1942). We therefore 

“must presume that [the broker] could have accomplished [the 

sale]” or was at least “entitled to the opportunity to try.” Id. Had 
15 

seller not intentionally concealed the potential buyer from broker, 

broker could have negotiated the sale and earned a commission 

under the procuring cause provision. Thus, the damages incurred 

as a result of seller’s breach are appropriately measured as the 

commission broker was due under the listing agreement. See, e.g.,

Kislak Co., 509 A.2d at 326; see also Watson v. Cal-Three, LLC, 254 

P.3d 1189, 1194 (Colo. App. 2011) (“In a breach of contract action, 

a plaintiff generally may recover the amount of damages that is 

required to place him in the same position he would have occupied 

had the breach not occurred.”). 

¶ 35 Accordingly, the court did not err in rejecting seller’s proposed 

procuring cause instruction. 

C. Laches Instruction 

¶ 36 The court rejected seller’s proposed instruction on the 

affirmative defense of laches. The court ruled that, because of 

seller’s improper conduct, seller did not “come[] before this court 

with sufficient clean hands to be able to assert” a laches defense. 

We agree with the court’s conclusion. 

¶ 37 Laches is an equitable defense that precludes a plaintiff from 

relief when the plaintiff has unconscionably delayed in enforcing its 
16 

rights, resulting in prejudice to the asserting party. In re Marriage 

of Johnson, 2016 CO 67, ¶ 16. However, “[a] party requesting 

equitable relief from the courts must do so with ‘clean hands.’” 

Premier Farm Credit, PCA v. W-Cattle, LLC, 155 P.3d 504, 519 (Colo. 

App. 2006) (citation omitted). When the requesting party’s 

improper conduct relates to the claim in some significant way, the 

improper conduct may bar that party’s entitlement to an equitable 

remedy. Salzman v. Bachrach, 996 P.2d 1263, 1269 (Colo. 2000). 

¶ 38 At trial, seller admitted that he had intentionally breached the 

referral provision and agreed that his purpose in concealing his 

negotiations was to deprive broker of its commission. Seller cannot 

now claim that broker unreasonably delayed bringing this action 

when seller intentionally concealed the facts giving rise to broker’s 

claim. 

¶ 39 Accordingly, the court did not abuse its discretion in rejecting 

seller’s equitable defense. See Premier Farm Credit, 155 P.3d at 520 

(“[I]t is within the trial court’s discretion to determine . . . whether 

the facts support a finding of unclean hands . . . .”). 

¶ 40 To the extent seller now also asserts that the court erred in 

not giving jury instructions on waiver and estoppel, seller did not 
17 

request such instructions. We decline to address issues not raised 

in the trial court. See JW Constr. Co., 253 P.3d at 1271. 

IV. Impeachment of Broker’s Agent 

¶ 41 In a pretrial ruling, the court granted broker’s motion in 

limine, which sought to exclude evidence of its agent’s recent 

personal bankruptcy. Seller does not directly challenge the in 

limine ruling. Instead, based on events that developed during trial, 

he contends that the court erred in denying him the right to 

impeach broker’s agent with this evidence at trial. We disagree. 

A. Standard of Review 

¶ 42 The scope and limits of cross-examination, as well as the 

admission or exclusion of evidence, are within the sound discretion 

of the district court. Bonser v. Shainholtz, 3 P.3d 422, 424 (Colo. 

2000); Radcliff Props. Ltd. P’ship, LLLP v. City of Sheridan, 2012 

COA 82, ¶ 31. Absent a showing of an abuse of that discretion, we 

will uphold the district court’s ruling. Scott v. Matlack, Inc., 39 P.3d 

1160, 1170 (Colo. 2002). A court abuses its discretion when its 

decision misapplies the law or it is manifestly arbitrary, 

unreasonable, or unfair. Salazar v. Kubic, 2015 COA 148, ¶ 6; 

Radcliff Props., ¶ 31. 
18 

B. Bankruptcy 

¶ 43 During cross-examination, broker’s agent testified that if 

broker was successful on its claim, the damages award was going to 

be split between him and the other agent who had worked on the 

listing. Seller argues that because the bankruptcy trustee in the 

agent’s personal bankruptcy case was entitled to a portion of any 

amount awarded, the court erred in precluding his questions 

seeking to impeach the agent’s credibility on that issue. But during 

trial the court made clear that it “[had] not preclude[d] the use of 

[the bankruptcy] for potential impeachment of the witness.” 

Instead, the court precluded questioning because seller’s attempt to 

impeach the agent with a bankruptcy document lacked sufficient 

foundation. 

¶ 44 Accordingly, the trial court acted within its discretion in 

limiting seller’s cross-examination. 

C. Additional Impeachment 

¶ 45 Seller also asserts that the court erred by precluding 

cross-examination of broker’s agent in several other areas. Because 

seller did not attempt to impeach broker’s agent at trial on the 
19 

grounds seller raises before us, seller did not adequately raise or 

preserve this issue. See JW Constr. Co., 253 P.3d at 1271. 

V. Statute of Frauds 

¶ 46 Seller argues that the statute of frauds bars broker’s claim 

because a signed listing agreement was not produced. We conclude 

seller waived this claim. 

¶ 47 The assertion that a plaintiff’s claim is barred by the statute of 

frauds is an affirmative defense. C.R.C.P. 8(c); Univex Int’l, Inc. v. 

Orix Credit All., Inc., 902 P.2d 877, 879 (Colo. App. 1995), aff’d, 914 

P.2d 1355 (Colo. 1996). Unless presented at trial, a defendant 

waives this affirmative defense. See Landmark Towers Ass’n v. UMB 

Bank, N.A., 2016 COA 61, ¶ 24 (cert. granted Nov. 7, 2016). Merely 

asserting the defense in the answer to the complaint and the trial 

management order are insufficient to preserve the issue for appeal. 

Id. at ¶ 25. 

¶ 48 Seller did not raise his statute of frauds defense at trial or 

tender an instruction to the jury. Nor did he present this argument 

in any dispositive motion. Accordingly, seller waived this defense. 
20 

VI. Property Transfer 

¶ 49 To facilitate the sale of the property to the buyers, seller first 

transferred his property to a limited liability company (LLC) 

controlled solely by him. The buyers then purchased a ninety-nine 

percent interest in the LLC and seller retained the remaining one 

percent. Seller argues that, based on this transfer, no sale occurred 

that would entitle broker to a commission because seller retained 

an interest in the property. See Cooley Inv. Co. v. Jones, 780 P.2d 

29, 31 (Colo. App. 1989). Because seller did not present this issue 

to the trial court, we again conclude that he has not preserved his 

argument for appeal. See JW Constr. Co., 253 P.3d at 1271. 

VII. Appellate Attorney Fees and Costs 

¶ 50 Broker requests an award of attorney fees and costs incurred 

on appeal. The listing agreement entitles the prevailing party in any 

litigation relating to the agreement to “all reasonable costs and 

expenses, including attorney and legal fees.” Because broker has 

prevailed in this appeal, we award attorney fees and costs in its 

favor. See Suss Pontiac-GMC, Inc. v. Boddicker, 208 P.3d 269, 272 

(Colo. App. 2008). 
21 

¶ 51 We exercise our discretion under C.A.R. 39.1 to remand the 

case to the district court for determination of broker’s reasonable 

attorney fees and costs. 

VIII. Conclusion 

¶ 52 The judgment is affirmed. The case is remanded for further 

proceedings to award broker’s costs and attorney fees incurred on 

appeal. 

JUDGE WEBB and JUDGE NIETO concur.