F I L E D
United States Court of Appeals
Tenth Circuit
PUBLISH
MAY 10 1999
UNITED STATES COURT OF APPEALS
PATRICK FISHER
Clerk
TENTH CIRCUIT
C-470 JOINT VENTURE, a Colorado
general partnership and GERALD J.
STARIKA,
Plaintiffs-Counter-Defendants -
Appellants,
v. No. 97-1478
TRIZEC COLORADO, INC., a Delaware
corporation,
Defendant-Counter-Claimant -
Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
(D. Ct. No. 96-WY-1612-CB)
Wayne B. Schroeder (Jody Harper Alderman, with him on the briefs), Grimshaw
& Harring, P.C., Denver, Colorado, appearing for Appellants.
John Lawrence Hamil (Michelle W. Stern, with him on the brief), Hamil
Professional Corporation, Denver, Colorado, appearing for Appellee.
Before TACHA, BARRETT, and HENRY, Circuit Judges.
TACHA, Circuit Judge.
This diversity action between plaintiff-appellant C-470 Joint Venture
(“Joint Venture”), a Colorado corporation, plaintiff-appellant Gerald Starika, a
Colorado resident, and defendant-appellee Trizec Colorado, Inc., a Delaware
corporation, presents a question regarding the enforceability of a covenant to
convey a property interest between Trizec and plaintiffs’ predecessor in interest.
The district court found the covenant enforceable on summary judgment and, after
trial, awarded damages to Trizec. We affirm.
In 1982, Trizec and The Good Partnership, a Colorado limited partnership,
entered into a dissolution and distribution agreement that terminated Park
Meadows Ltd., a limited partnership between the two entities. The entities had
formed Park Meadows in large part to develop a regional shopping center.
Pursuant to the dissolution agreement, both Trizec and The Good Partnership took
a portion of the property owned by Park Meadows. Trizec received the future
shopping center site, while The Good Partnership received surrounding lands,
referred to as the “Adjoining Lands.” All land was located near the proposed
Colorado Highway 470 (“C-470”), and the parties contemplated the construction
of an interchange on the lands distributed to The Good Partnership. On April 7,
1982, Trizec and The Good Partnership executed and subsequently recorded a
Covenants Agreement, which provides:
3. Additional Covenants. The Good Partnership hereby declares the
Adjoining Lands, or so much of them as shall be specified below, to
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be subject to the following covenants and burdens:
....
(d) For a period of fifteen years after the date of this
Agreement, the Good Partnership will, from time to time at Trizec’s
request, convey and/or dedicate from the Mercy Tract and the
Miscellaneous Tracts (as described in Exhibit B attached hereto) such
easements, rights-of-way or other accessways (aggregating not more
than five acres) as shall be necessary or required for the construction
and operation of either a full diamond or half diamond interchange at
South Yosemite Street and Colorado Highway 470. Such conveyance
or dedications shall be made without charge;
....
The provisions of subsections 3(a) through 3(e) above shall be
deemed covenants running with title to the Adjoining Lands, and
shall be binding upon the Good Partnership and its successors in title
to the Adjoining Lands. The benefits of, and all rights of
enforcement with respect to, subsections 3(a) through 3(e) shall inure
solely to Trizec and its successors in title to the Town Center Tract.
Appellants’ App., Vol. III, at 01176-79.
In 1983, appellant Joint Venture acquired part of the Adjoining Lands,
including Parcel B, the land containing the crossing of Yosemite Street and C-
470. In a subsequent agreement with Trizec, Joint Venture expressly
acknowledged that Covenant 3(d) from the 1982 Covenants Agreement ran with
the title to Parcel B. Joint Venture quit-claimed an eighteen percent interest in its
land to appellant Gerald Starika. On November 27, 1995, Trizec requested in
writing that plaintiffs perform Covenant 3(d) by conveying a right-of-way for an
interchange to Douglas County. A legal metes and bounds description of a right-
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of-way covering approximately 2.2 acres accompanied the letter. Plaintiffs
refused to perform, claiming that Covenant 3(d) was unenforceable.
In May 1996, Douglas County began condemnation procedures on the 2.2
acres. The condemnation action is still pending, though Douglas County has
obtained possession of the property and constructed the access ramp by depositing
$199,800.50 with the Douglas County District Court. 1 On July 2, 1996, plaintiffs
filed the instant action in federal district court seeking a declaratory judgment
holding the covenant unenforceable under Colorado law. Defendants counter-
claimed for specific performance and sanctions. The district court granted
summary judgment on the validity and enforceability of the covenant. A two day
bench trial followed. The district court found plaintiffs had breached the
covenant but, because the county had completed the interchange and the
condemnation proceeding was ongoing, it awarded Trizec damages incurred as a
result of the condemnation proceedings rather than specific performance. The
court also denied Trizec’s request for sanctions. Plaintiffs appeal the district
court’s summary judgment ruling on the enforceability of the covenant and further
assert that the district court’s judgment is unenforceable due to uncertainty.
We review the grant of summary judgment de novo, applying the same legal
Trizec entered into an agreement with Douglas County to provide the necessary
1
funds.
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standard used by the district court. See, e.g., Kaul v. Stephen, 83 F.3d 1208, 1212
(10th Cir. 1996). Summary judgment is appropriate when “the pleadings,
depositions, answers to interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to any material fact and
that the moving party is entitled to a judgment as a matter of law.” Fed. R. Civ.
P. 56(c). If no genuine issue of material fact is in dispute, we determine whether
the district court correctly applied the substantive law. See Kaul, 83 F.3d at
1212. We also review questions of law de novo. See, e.g., Wolfgang v. Mid-
America Motorsports, Inc., 111 F.3d 1515, 1524 (10th Cir. 1997).
I.
A.
Plaintiffs advance several arguments why Covenant 3(d) fails under
Colorado contract law. First, they claim the description of the property lacks
adequate specificity to satisfy Colorado’s Statute of Frauds, C.R.S. § 38-10-108, 2
and Colorado contract law. We disagree.
To satisfy Colorado law, a memorandum for the conveyance of land
must show on its face, or by reference to other writings, first, the
names of the parties . . . ; second, the terms and conditions of the
2
Section 38-10-108 provides: “Every contract . . . for the sale of any lands or any
interest in lands is void unless the contract or some note or memorandum thereof
expressing the consideration is in writing and subscribed by the party by whom the . . .
sale is to be made.”
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contract; third, the interest or property affected; and fourth, the
consideration to be paid therefor.” . . . “If the names and intention of
the contracting parties can be determined with reasonable certainty
from the language of the instrument, and a valid contract is thereby
disclosed, specific performance may be decreed thereon.
Micheli v. Taylor, 159 P.2d 912, 913 (Colo. 1945) (en banc) (quoting Eppich v.
Clifford, 6 Colo. 493, 494-495 (Colo. 1883)). “Reasonable certainty in the
ascertainment of the lands agreed to be conveyed is all that is required. If the
writing contains indicia by reference to which, coupled with the defective
designation otherwise, the identity of the premises can reasonably be determined,
specific performance may be decreed.” Shull v. Sexton, 390 P.2d 313, 319 (Colo.
1964) (en banc) (internal citations and quotation marks omitted). Thus, the
contract must identify the land at issue with “reasonable certainty.”
Covenant 3(d) accomplishes this. The parties knew in 1982 the planned
route of C-470, and Yosemite Street already existed. Therefore, the parties knew
with reasonable certainty the location of the proposed interchange. The fact that
they failed to establish a specific legal description of the property until time of
performance does not render the contract unenforceable. See Hill v. Chambers,
314 P.2d 707, 709 (Colo. 1957) (finding contract to convey one acre on which a
house could be built was sufficiently certain, given external evidence of
defendant’s land and adjoining properties); Ehrich v. Durkee, 72 P. 814, 816
(Colo. 1903) (finding valid contract when vendee was to pick land equal to
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$487.80 within one year from designated lots). See generally 6A Richard R.
Powell & Patrick J. Rohan, Powell on Real Property § 880(1)[iii] (1995). We
find Ehrich particularly apposite because, in that case, the parties did not identify
the specific land to be conveyed until the vendee picked the property from a
larger plot of land. The Colorado Supreme Court stated that as long as the larger
plot of land and the land demanded by the vendee could be ascertained, the
contract would be enforced. See Ehrich, 72 P. at 816. This case presents a
similar situation. The parties knew the boundaries of Parcel B, the general
location of the proposed interchange, and, in 1995, the precise metes and bounds
of the requested right-of-way. Accordingly, the covenant sufficiently identified
the property at issue.
B.
Plaintiffs also contend that the covenant fails because it did not specifically
identify the vendee of the right-of-way. To support their contention, plaintiffs
cite language from several older Colorado cases stating that Colorado law
requires a contract for the sale of real property to identify a vendor and a vendee.
See Eppich, 6 Colo. at 494 (“the note or memorandum must show on its face . . .
first, the names of the parties, vendor and vendee . . .”); Micheli, 159 P.2d at 913
(quoting Eppich). We find those cases simply stand for the general rule that a
contract for the sale of real property must identify the parties. See Shull, 390
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P.2d at 316 (“A contract must contain the essentials -- parties, terms, subject
matter and consideration.”) (emphasis added); Micheli, 159 P.2d at 913 (“If the
names and intention of the contracting parties can be determined with reasonable
certainty from the language of the instrument . . . specific performance may be
decreed thereon.”).
Usually, the contracting parties are the vendor and vendee, as was the case
in Eppich and Micheli. Here, the contracting parties were Trizec and The Good
Partnership, both of whom the contract identifies. We conclude that the vendee
of the right-of-way constitutes a third party beneficiary of the contract, subject to
Trizec’s “request.” A third party beneficiary is created if the parties to the
agreement intended to benefit a non-party. See E.B. Roberts Constr. Co. v.
Concrete Contractors, Inc., 704 P.2d 859, 865 (Colo. 1985) (en banc). “While the
intent to benefit the non-party need not be expressly recited in the contract, the
intent must be apparent from the terms of the agreement, the surrounding
circumstances, or both.” Id. In signing Covenant 3(d), Trizec and The Good
Partnership clearly intended to promote the construction of an interchange by
making the right-of-way available to the constructing party at no cost. Both the
language of 3(d), which makes the conveyance of the right-of-way subject to
Trizec’s request, and the surrounding circumstances show the parties intended to
benefit a party building the interchange.
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Although Colorado does not have any specific law on point, the Statute of
Frauds generally does not require a third party beneficiary to sign or be named in
the contract. See Coleman v. Mountain Mesa Uranium Corp., 240 F.2d 12, 16
(10th Cir. 1956) (If . . . [plaintiff] was a third party beneficiary[,] he could sue
for the enforcement of his rights under the contract, although he was not a party
thereto or was not mentioned therein.”); 72 Am. Jur. 2d Statute of Frauds § 364
(1974). In Coleman, we applied this rule to the Wyoming Statute of Frauds,
which is similar to Colorado’s. We therefore hold the rule applies to Colorado
law as well. In addition, general contract law does not require identification of a
third party beneficiary at the time of contract formation. 4 Arthur Linton Corbin,
Corbin on Contracts § 781 (1951). “It is enough that he be identified at the time
performance is due.” Id. Trizec satisfied this requirement in its demand letter by
requesting the transfer of the right of way to Douglas County. In short, Covenant
3(d) identifies the parties sufficiently to comply with Colorado law.
C.
Finally, plaintiffs assert that Covenant 3(d) is void for indefiniteness
because it fails to give any party the power to designate the land required for the
interchange. We agree with the district court that the Covenant clearly gives
Trizec the power to designate the property. The Covenant requires plaintiffs to
provide “at Trizec’s request . . . such easements, rights-of-way or other
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accessways (aggregating not more than five acres) as shall be necessary or
required for the construction and operation of either a full diamond or half
diamond interchange . . . .” This language, especially in context of the entire
agreement, see Carleno Coal Sales, Inc. v. Ramsay Coal Co., 270 P.2d 755, 757
(Colo. 1954) (en banc) (noting the meaning of contract provision must be
determined in light of the whole agreement and intent of the parties); 5 Margaret
N. Kniffin, Corbin on Contracts § 24.21 (rev. ed. 1998), empowers Trizec to
identify the necessary land.
II.
Plaintiffs’ last argument involves the certainty of the district court’s
judgment. According to plaintiffs, the judgment is so uncertain as to inadequately
state the type of relief granted or the rights and obligations of the parties.
Plaintiffs claim the district court awarded an interest in the right-of-way to
Trizec, but did not require specific performance, the normal remedy in a real
property contract suit. Also, the district court suggested in a footnote that the
intended vendee of Covenant 3(d) was the state, but allegedly awarded the interest
to Trizec. We do not find the district court judgment void for uncertainty. We
will, however, clarify the judgment as it affects the rights of the parties.
As noted above, we read Covenant 3(d) as giving Trizec the power to
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designate the recipient of the easement. 3 We construe the district court’s
judgment as recognizing Trizec’s contractual right to designate the easement and
have it conveyed by plaintiffs. Since Trizec designated Douglas County as
recipient, the interest now belongs to Douglas County.
For the foregoing reasons, we AFFIRM the district court’s grant of
summary judgment on the enforceability of Covenant 3(d) and its award of
damages.
3
Covenant 3(d) actually creates a future interest -- a springing executory interest -- in
Trizec’s designee. The interest vested when Trizec sent its letter to plaintiffs designating
Douglas County as the recipient and establishing the precise bounds of the easement.
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C-470 Joint Venture v. Trizec Colorado, Inc.
Court: Court of Appeals for the Tenth Circuit
Date filed: 1999-05-10
Citations: 176 F.3d 1289
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