F I L E D

United States Court of Appeals

Tenth Circuit

AUG 27 2003

PATRICK FISHER

Clerk

PUBLISH

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

STANLEY B. BOEHME;

SYLVIA T. BOEHME,

Plaintiffs-Appellants,

v.

UNITED STATES POSTAL

SERVICE, as successor to the

United States Post Office Department

of the United States of America and

All Other Occupants of the property

located at 2641 E. Uintah, Colorado

Springs, Colorado 80909,

Defendant-Appellee.

No. 02-1443

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLORADO

(D.C. No. 01-N-1237 (CBS))

Submitted on the briefs:

John Randolph Torbet, Colorado Springs, Colorado, for Plaintiffs-Appellants.

John W. Suthers, United States Attorney, Kathleen L. Torres, Assistant United

States Attorney, Elizabeth A. Weishaupl, Assistant United States Attorney,

Denver, Colorado, for Defendant-Appellee.

Before EBEL , PORFILIO , and McCONNELL , Circuit Judges.
1 After examining the briefs and appellate record, this panel has determined

unanimously to grant the parties’ request for a decision on the briefs without oral

argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore

ordered submitted without oral argument.

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EBEL , Circuit Judge.

Plaintiffs Stanley B. Boehme and Sylvia T. Boehme appeal from the district

court’s dismissal of their complaint under Fed. R. Civ. P. 12(b)(1) for lack of

subject matter jurisdiction. Our jurisdiction arises under 28 U.S.C. § 1291, and

we review a dismissal for lack of subject matter jurisdiction de novo. King v.

United States , 301 F.3d 1270, 1273 (10th Cir. 2002), cert. denied , 123 S. Ct. 2572

(2003). We affirm. 1

I.

Defendant United States Postal Service (Postal Service) operates a post

office facility in Colorado Springs, Colorado, in a building that it leases from

plaintiffs. The lease contains a “Tax Rider Clause” which provides that the Postal

Service has the duty to pay the real property taxes due on the leased property as

additional rent. This case involves a dispute between the parties regarding the

payment of real property taxes allegedly due on the leased property, and plaintiffs

alleged the following in their complaint:
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10. That the Plaintiffs gave due notice of the amount of real

property taxes due for the year 2000 to the [Postal Service]. 

However, the [Postal Service] failed and refused to pay such taxes.

11. That on or about May 23, 2001 a demand for rent or

possession of premises on behalf of Plaintiffs was duly served upon

the [Postal Service] . . . . 

12 . That said demand provided, pursuant to the law of the

State of Colorado, specifically [Colo. Rev. Stat. §] 13-40-106, that

the [Postal Service] would have three (3) days to either comply with

the demand (i.e., pay Plaintiffs the taxes) or surrender possession of

the premises by virtue of the Plaintiffs’ termination of the lease.

13. That the [Postal Service] failed and refused to tender or

pay the amount of the taxes due as rent within said period.

14. That pursuant to the law of the State of Colorado,

specifically [Colo. Rev. Stat. §] 13-40-104(1)(d) the continued

possession of the [Postal Service] amounts to an unlawful detainer of

the real property described above.

15. That the Plaintiffs are entitled to a judgment of this Court

finding and determining that the Plaintiffs are entitled to possession

of the above described real property.

Aplt. App. at 10-11, ¶¶ 10-15. In their request for relief, plaintiffs then sought

the following relief: 

Plaintiffs demand judgment against the Defendants finding and

concluding that the Lease . . . has been duly terminated . . . .; that the

continued occupation of the premises by the [Postal Service] is

unlawful; and for an order granting the right of possession to said

premises to the Plaintiffs; and further for additional orders awarding

the Plaintiffs damages in the form of the fair market value of the

possessory interest in such property together with attorney’s fees,

costs and interest . . . .

Id. at 12.
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The Postal Service filed a motion to dismiss plaintiffs’ complaint under

Fed. R. Civ. P. 12(b)(1) for lack of subject matter jurisdiction. Relying on this

court’s decision in Three-M Enterprises, Inc. v. United States , 548 F.2d 293,

294-95 (10th Cir. 1977) (holding, in case involving alleged default by government

in payment of rent for property leased for use as a post office, that district court

lacked subject matter jurisdiction over statutory unlawful detainer action brought

against the United States under Utah law because the landlord plaintiff had failed

to exhaust its administrative remedies under the Federal Tort Claims Act), the

Postal Service argued that plaintiffs’ statutory action for unlawful detention under

Colo. Rev. Stat. § 13-40-104(1)(d) sounds in tort and is thus subject to the

Federal Tort Claims Act (FTCA), 28 U.S.C. §§ 1346(b)(1), 2671-80. According

to the Postal Service, plaintiffs were therefore required by 28 U.S.C. § 2675(a) to

exhaust their administrative remedies against the Postal Service before filing

a district court action against the United States under 28 U.S.C. § 1346(b)(1),

which they failed to do. Because the FTCA’s administrative exhaustion

requirement is jurisdictional and cannot be waived, Three-M Enterprises ,

548 F.2d at 294, the Postal Service requested that the district court dismiss

plaintiffs’ unlawful detention action for lack of subject matter jurisdiction.

At a hearing before the district court on the Postal Service’s motion to

dismiss, the court granted the motion and dismissed plaintiffs’ complaint. The
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district court gave two reasons for its ruling. First, because this court decided

Three-M Enterprises several years after Congress enacted the Postal

Reorganization Act (PRA), 39 U.S.C. § 101, et seq. , (effective 1971), the court

rejected plaintiffs’ argument that the general grant of jurisdiction provided to the

district courts by 39 U.S.C. § 409(a) “over all actions brought by or against the

Postal Service” implicitly overruled this court’s decision in Three-M Enterprises . 

Aplt. App. at 67. Second, the court noted that § 409(c) expressly provides that

the requirements of the FTCA apply to tort claims arising out of activities of the

Postal Service. Id. at 68. Without analyzing the issue of whether plaintiffs’

statutory claim for unlawful detention under Colorado law was a tort or contract

claim, the court then determined that it was bound by this court’s decision in

Three-M Enterprises because it “is on point, has not been overruled, and is

controlling.” Id.

II.

“It is well settled that the United States, as sovereign, is immune from suit

except as it consents to be sued and that the terms of its consent to be sued in any

court define the court’s jurisdiction to entertain the action.” Three-M

Enterprises , 548 F.2d at 294. In this case, the sovereign immunity issues turn on

two provisions in the PRA. The first provision is 39 U.S.C. § 401(1), and it

provides that the Postal Service has the general power “to sue and be sued in its
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official name.” In Kennedy Elec. Co. v. United States Postal Serv. , 508 F.2d 954,

955, 957 (10th Cir. 1974), a case involving a breach of contract action brought by

a private subcontractor against the Postal Service, we recognized that § 401(1)

grants the Postal Service the power to sue and be sued, and that “it must be

presumed that when Congress launched a governmental agency into the

commercial world and endowed it with authority to ‘sue or be sued,’ that agency

is not less amenable to judicial process than a private enterprise under like

circumstances would be.” (quoting FHA v. Burr , 309 U.S. 242, 245 (1940)). 

Further, both the Supreme Court and several of our sister circuits have made it

clear that § 401(1) constitutes a general waiver of the Postal Service’s sovereign

immunity. See Loeffler v. Frank , 486 U.S. 549, 554-56 (1988); Davric Maine

Corp. v. United States Postal Serv. , 238 F.3d 58, 61 (1st Cir. 2001); Global Mail

Ltd. v. United States Postal Serv. , 142 F.3d 208, 210 (4th Cir. 1998); United

States v. Q Int’l Courier, Inc. , 131 F.3d 770, 775 (8th Cir. 1997). We also note

that the waiver in § 401(1) “must be liberally construed and . . . the Postal

Service’s liability must be presumed to be the same as that of any other business.” 

Loeffler , 486 U.S. at 556; see also Davric , 238 F.3d at 61 (noting that “the PRA

established the Postal Service as a quasi-public entity that was to compete on

essentially level ground with private enterprise”).
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The second provision of the PRA relating to sovereign immunity is

39 U.S.C. § 409(c), and it provides that “[t]he provisions of [the FTCA] and all

other provisions of Title 28 relating to tort claims shall apply to tort claims

arising out of activities of the Postal Service.” Although this court has not

previously had an occasion to address the interplay between §§ 401(1) and 409(c),

we agree with our sister circuits that “§ 409(c) of the PRA limits the scope of the

more general waiver of sovereign immunity contained in § 401(1),” Davric ,

238 F.3d at 62, and that “[f]or state tort claims arising out of the activity of the

Postal Service, § 409(c) compels the application of the FTCA and its attendant

provisions,” id.; accord Global Mail , 142 F.3d at 215 (holding that § 409(c)

“restrict[s] § 401(1)’s general waiver of sovereign immunity . . . by requiring

claimants to follow FTCA procedures for those claims cognizable under the

FTCA”); Q Int’l Courier , 131 F.3d at 775 (same); see also 28 U.S.C. § 2679(a)

(providing that claims against “sue and be sued” federal agencies must be brought

under the FTCA if the claims are “cognizable” under the FTCA). 

Consequently, the dispositive issue in this case is whether plaintiffs’

unlawful detention action under Colo. Rev. Stat. § 13-40-104(1)(d) must be

treated as a state-law tort claim, in which case, under § 409(c), the FTCA’s

administrative exhaustion requirement would apply, or, alternatively, whether the

action must be treated as a state-law breach of contract claim, in which case,
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under § 401(1), there would be a general waiver of sovereign immunity and the

Postal Service could be sued directly without any exhaustion requirement. 

Because the source of the government’s substantive liability under the FTCA

is state law, FDIC v. Meyer , 510 U.S. 471, 477-78 (1994) (construing former

28 U.S.C. § 1346(b), which is now codified at 28 U.S.C. § 1346(b)(1)), the

determination of how to characterize Colorado’s statutory unlawful detention

action for purposes of §§ 401(1) and 409(c) is likewise a matter of state law. 

Unfortunately, our research has not uncovered any Colorado decisions that

provide a definitive answer as to whether § 13-40-104(1)(d) sounds in tort or

contract. As a result, we must predict how the Colorado Supreme Court would

rule. FDIC v. Schuchmann , 235 F.3d 1217, 1225 (10th Cir. 2000). In doing so,

“we are free to consider all resources available, including decisions of [Colorado]

courts, other state courts and federal courts, in addition to the general weight and

trend of authority.” Id. Having thoroughly analyzed the relevant authorities, we

predict that the Colorado Supreme Court, if faced with the issue, would determine

that § 13-40-104(1)(d) sounds in tort.

As noted above, the district court concluded that our decision in Three-M

Enterprises conclusively determined that state-law unlawful detention actions

such as the one here sound in tort. However, we agree with plaintiffs that our

decision in Three-M Enterprises did not specifically address the issue of whether
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Utah’s statutory unlawful detention action sounded in tort or contract, and it

appears that both the parties and this court simply assumed that the action

sounded in tort. Nonetheless, while not dispositive, we believe our decision in

Three-M Enterprises is persuasive given the similarities between the Utah statute

at issue in that case and the Colorado statute at issue in this case. Compare Utah

Code Ann. § 78-36-3(3) (1953), with Colo. Rev. Stat. § 13-40-104(1)(d) (2002). 

Moreover, we note that our decision in Three-M Enterprises is over twenty-five

years old, and, to our knowledge, not a single court or commentator has

questioned the necessary assumption underlying the decision that Utah’s statutory

unlawful detention action sounds in tort.

We need not rely exclusively on our decision in Three-M Enterprises ,

however, because the Colorado Supreme Court’s en banc decision in City &

County of Denver v. Desert Truck Sales, Inc. , 837 P.2d 759 (1992) convinces us

that the Colorado Supreme Court would determine that § 13-40-104(1)(d) sounds

in tort. In Desert Truck , the court determined that a replevin action under

Colo. R. Civ. P. 104 to obtain possession of personal property that was initially

obtained by a third party lawfully, but that had been wrongfully detained, sounds

in tort and is therefore subject to Colorado’s Governmental Immunity Act if

asserted against a state entity. Desert Truck , 837 P.2d at 763-65. In reaching its

holding, the court emphasized that “[t]he object of a replevin action is to
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determine the right of possession,” id. at 764, and the court rejected decisions

from other jurisdictions that “have refused to identify replevin as a tort,” id.,

concluding instead that a “claim that . . . property is ‘wrongfully’ detained sounds

in tort and is or could be a tort,” id. at 765.

Colo. Rev. Stat. § 13-40-104(1)(d) is part of Colorado’s Forcible Entry and

Detainer statute. While the statute provides for monetary claims for past due rent,

present and future damages, and reasonable costs and attorney’s fees, see

Colo. Rev. Stat. §§ 13-40-110(1), 13-40-115(2), and 13-40-123, the primary

purpose of the statute is to restore possession of disputed real property to

the person or entity with the superior right to possess the property. See

Colo. Rev. Stat. § 13-40-110(1) (providing that “[a]n action under this article is

commenced by filing with the court a complaint in writing describing the property

with reasonable certainty, the grounds for recovery thereof, the name of the

person in possession or occupancy, and a prayer for recovery of possession”);

Colo. Rev. Stat. § 13-40-115(2) (providing that, after issue of whether defendant

committed an unlawful detention is tried and determined adversely to defendant,

“court shall enter judgment for the plaintiff to have restitution of the premises and

shall issue a writ of restitution”); see also Petry v. City & County of Denver ,

233 P.2d 867, 870 (Colo. 1951) (en banc) (discussing prior version of Colorado’s

unlawful detainer statute and noting that proceedings thereunder “involve solely
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the right to possession”). Further, the Colorado Supreme Court has recognized

that § 13-40-104(1)(d) is “designed to provide landlords with an expeditious

method of gaining possession of their premises following a . . . breach of a lease.” 

Francam Bldg. Corp. v. Fail , 646 P.2d 345, 348 (Colo. 1982) (en banc).

For purposes of this case, the only material difference under Colorado law

between a replevin action and an unlawful detention action is that the former

involves personal property, while the latter involves real property. Accordingly,

based on its decision in Desert Truck , and the similarities between a replevin

action under Colo. R. Civ. P. 104 and an unlawful detention action under

Colo. Rev. Stat. § 13-40-104(1)(d), we predict that the Colorado Supreme Court

would conclude that an unlawful detention action sounds in tort. That said, we

must emphasize that, as the paragraphs quoted above from plaintiffs’ complaint

demonstrate, plaintiffs relied exclusively on § 13-40-104(1)(d) and the related

provisions under Colorado’s Forcible Entry and Detainer statute for their cause of

action in this case. See Aplt. App. at 10-11, ¶¶ 10-15, 12. Our holding in this

case is thus quite limited, and we do not by this decision intend to comment in

any way concerning what the outcome of this case would have been if plaintiffs

had asserted a common law breach of contract claim or some other type of

non-tort remedy under Colorado law. 
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Finally, plaintiffs argue that subjecting their unlawful detention claim to

the FTCA violates Colorado’s economic loss rule. The Colorado Supreme

Court’s “formulation of the economic loss rule is that a party suffering only

economic loss from the breach of an express or implied contractual duty may not

assert a tort claim for such breach absent an independent duty of care under tort

law.” Grynberg v. Agri Tech, Inc. , 10 P.3d 1267, 1269 (Colo. 2000) (en banc). 

The Colorado Supreme Court has also recognized, however, “that certain common

law claims that sound in tort and are expressly designed to remedy economic loss

may exist independent of a breach of contract claim.” Town of Alma v. Azco

Constr., Inc. , 10 P.3d 1256, 1263 (Colo. 2000) (en banc) (citing Brody v. Bock ,

897 P.2d 769, 776 (Colo. 1995) (holding that common law fraud claim is based on

violation of a duty independent of contract); Keller v. A.O. Smith Harvestore

Prods., Inc. , 819 P.2d 69, 73 (Colo. 1991) (holding that negligent

misrepresentation is a tort claim based “not on principles of contractual obligation

but on principles of duty and reasonable conduct”)). According to the court:

In these situations where we have recognized the existence of a duty

independent of any contractual obligations, the economic loss rule

has no application and does not bar a plaintiff’s tort claim because

the claim is based on a recognized independent duty of care and thus

does not fall within the scope of the rule.

Town of Alma, 10 P.3d at 1263.
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In this case, there is no question that plaintiffs’ unlawful detention claim is

based on the Postal Service’s alleged breach of the parties’ lease agreement. It is

also undisputed that plaintiffs have suffered only economic losses as a result of

the alleged breach. Nonetheless, we conclude that Colorado’s economic loss rule

has no application to this case. By enacting Colorado’s Forcible Entry and

Detainer statute and, more specifically, Colo. Rev. Stat. § 13-40-104(1)(d), the

Colorado legislature has provided a statutory remedy to landlords that “exist[s]

independent of a breach of contract claim.” Town of Alma, 10 P.3d at 1263. And,

while the statutory remedy has not necessarily created a tort “duty” that exists

independent of any contractual obligations, as is the case, for example, with

common law fraud and negligent misrepresentation claims, the principle is the

same. Specifically, there is no question that, under Colorado law, a landlord may

simultaneously pursue both his statutory and his contract remedies to recover the

same economic losses, and this is true regardless of whether the statutory remedy

is characterized as a tort or a contract action. Thus, the question of whether to

characterize the statutory remedy as being in tort or contract is only germane to

the issue of how the remedy is to be treated for purposes of the FTCA, and the

economic loss rule has no application to this case. 

The judgment of the district court is AFFIRMED.