Opinion ID: 2355739
Heading Depth: 2
Heading Rank: 1

Heading: Pursell's Costs and Attorney Fees Stemming from the Final Decree

Text: When the water court granted attorney fees to Sebesta and Pursell for the Motion to Enforce, it also granted Pursell's motion to reconsider its denial of costs and fees from the Final Decree. Anderson argues that the water court abused its discretion in granting Pursell's motion for reconsideration and awarding Pursell costs and attorney fees for all previous stages of the litigation. He argues that because Pursell originally filed his motion for costs and fees after the fifteen-day time limit set forth in C.R.C.P. 121, section 1-22, the water court could not grant the motion. Further, he asserts that Pursell was not a prevailing party in a dispute under the Water Agreement, and thus, that costs and attorney fees were not proper. We disagree. We review the decision to award costs and attorney fees under an abuse of discretion standard. School Dist. No. 12 v. Sec. Life of Denver Ins. Co., 185 P.3d 781, 787 (Colo.2008) (citation omitted). A trial court abuses its discretion if its decision is manifestly arbitrary, unreasonable, or unfair. Colo. Nat'l. Bank of Denver v. Friedman, 846 P.2d 159, 167 (Colo.1993) (citations omitted). Further, the party requesting fees has the burden of proving that it is entitled to them. Am. Water Dev., Inc. v. City of Alamosa, 874 P.2d 352, 383 (Colo.1994) (citations omitted).
The injunction, Final Decree, and all related motions were a result of a dispute under the Water Agreement. The Water Agreement states that [i]n the event of a dispute arising concerning the intent or construction of this Agreement, the prevailing party shall be entitled to reasonable attorney's fees (emphasis added). We have interpreted the phrase arising out of to mean to originate from, grow out of, or flow from. City & Cnty. of Denver v. Gonzales, 17 P.3d 137, 140-41 (Colo.2001) (internal quotations omitted) (interpreting a fee shifting provision in a statute); see also Bedard v. Martin, 100 P.3d 584, 593 (Colo.App.2004) (interpreting a fee shifting provision in a real estate contract). In this case, the language in the Water Agreement is sufficiently similar to arising out of and we see no reason why that definition is not applicable here, making this a dispute arising concerning the intent or construction of the [Water Agreement]. Although Anderson's original application did not specifically involve the Water Agreement, nearly every other motion and order in this case referenced and incorporated the Water Agreement. Even Anderson agrees that his motion for an injunction was made in part to enforce and interpret the Water Agreement. The Final Decree also interpreted and incorporated the Water Agreement. In the Final Decree, the water court clarified what it meant to require one-half of the water to remain in the main part of the Eureka Ditch. Therefore, we conclude that this was a dispute concerning the intent or construction of [the Water Agreement]. We further conclude that Pursell was the prevailing party under this provision. Like the decision to award attorney fees, we review determinations of which party is the prevailing party under a fee shifting provision for an abuse of discretion. Dennis I. Spencer Contractor, Inc. v. City of Aurora, 884 P.2d 326, 328 n.6 (Colo.1994) (citing Smith v. Freeman, 921 F.2d 1120, 1122 (10th Cir.1990)). We use this standard because the trial court is in the best position to observe the course of the litigation and to determine which party ultimately prevailed. Archer v. Farmer Bros., 90 P.3d 228, 231 (Colo.2004) (citations omitted). In order to be a prevailing party, a party must succeed on a significant issue in the litigation and achieve some of the benefits sought. In re Water Rights of Bd. of Cnty. Comm'rs of Cnty. of Arapahoe, 891 P.2d 981, 984 (Colo.1995) (citing Odenbaugh v. Cnty. of Weld, 809 P.2d 1059, 1063 (Colo. App.1990)). But, [t]he issue on which the party prevails need not be the central issue in the litigation, only a significant one. Id. (citations omitted). The court should examine the overall context of the case, Munoz v. Measner, 214 P.3d 510, 515 (Colo.App.2009), and should consider where in the case the parties spent the majority of their time and resources, Archer, 90 P.3d at 232. In Archer, we held that a party was a prevailing party under C.R.C.P. 54(d) and entitled to costs even though there had been an adverse judgment against it. Id. There, although the other party had prevailed on one claim, we determined that the vast majority of the time and resources of the litigation were devoted to the claims that were dismissed against the party. Id. Thus, we held that the party was entitled to costs as the prevailing party despite the adverse judgment against it. Id. Here, the bulk of the litigation involved whether or not Sebesta and Pursell were required to by-pass the ponds on their properties so that Anderson would receive his share of the water right in accordance with the Water Agreement. There was little to no contention over the other parts of the application. The water court ultimately ruled that the Water Agreement did not require Sebesta and Pursell to by-pass the ponds on their properties. Thus, because Pursell succeeded on his main objection to the application and the only issue that was significantly litigated, the water court was correct in determining that he was the prevailing party in a dispute arising concerning the intent or construction of the [Water Agreement].
Anderson argues that, even if Pursell was the prevailing party under the Water Agreement, the water court erred in awarding costs and attorney fees to Pursell for two reasons: first, because he was late in filing the motion and second, because the motion should have been denied as a matter of law because the water court did not rule on the motion within sixty days in accordance with C.R.C.P. 59(j). C.R.C.P. 121, section 1-22 states that a party claiming costs and attorney fees shall make a motion for such within 15 days of the entry of order or judgment or within such greater time as the court may allow. A trial court, however, is not required to deny a motion for costs and attorney fees if it is filed outside of the fifteen-day time limit, even if the submitting party does not request an extension of time. US Fax Law Ctr., Inc. v. Henry Schein, Inc., 205 P.3d 512, 515-16 (Colo.App.2009) (citing In re Marriage of Wright, 841 P.2d 358, 361 (Colo.App.1992)). Further, requests for costs and attorney fees are outside the purview of C.R.C.P. 59(j)'s requirement that a motion be denied as a matter of law if it is not decided on within sixty days. See Tallitsch v. Child Support Servs., Inc., 926 P.2d 143, 146 (Colo.App.1996) (citations omitted) (issues concerning recovery of attorney fees not sought as damages . . . are outside the purview of C.R.C.P. 59); see also Baldwin v. Bright Mortg. Co., 757 P.2d 1072, 1073-74 (Colo.1988) (a decision is final and appealable despite outstanding attorney fee issues). Thus, the water court did not abuse its discretion in granting Pursell's motion for reconsideration, despite the original motion for costs and attorney fees being filed outside of the fifteen-day deadline, and properly granted Pursell costs and attorney fees related to the Final Decree. [5]