Quiet Title Actions

I- Introduction

Actions under Rule 105 are meant to adjudicate the rights of a1l interested parties to a

specific parcel of real estate. Rule 105(a). The idea is to avoid piecemeal litigation and

bring all claims and all parties into one lawsuit. Indeed, subsection 'tOS(a) is entitled

"Complete Adjudication of Rights." (Emphasis added.) Historically, quiet title actions

were in rem (and technically still are), but Rule 105(a) allows not only for a complete

adjudication of rights, but also for "damages, if any, for the withholding of possession,"

an obvious merger of actions that were once equitable (adjudication of rights) and actions

at law (for damages).ln Board of County Commissioners of Pitkin County v. Timroth, 87

P 3d 1A2 (Colo- 2004) the Colorado Supreme Court held that the trial court acted

properly in considering the county's argument in a summary judgment brief for

reformation of a tax deed even though the county had not raised the issue in its pleadings.

In addition, claims for declaratory relief have been asserted to determine and decree real

estate titles. Near v. Calkins,946 P.2d 537 (Colo. App. 1997) C.R.S. $ 13-51-105;

C.R.Civ.P. 57, but, see, also Martinez v. Archuleta-Padia, Colo. App. June 1, 2006

(declaratory judgment action recharacterized as quiet title action by court of appeals).

Rule 105 can be used to remove or adjudicate clouds on title, foreclose deeds of

trust to the public trustee or a private trustee, foreclose a mortgage or adjudicate other

liens on real property, reformation of deeds and other documents, adjudicate adverse

possession, prescriptive easement claims and other access issues, boundary disputes, (but

see Gaines v. City of Sterling,342 P.2d 651 (Colo. 1959), rule 105 inapplicable to

disputed boundary action under C.R.S. $ 38-44-101), actions for unlawful detainer and

fejectment, actions to set aside tax deeds and actions to adjudicate easements, mineral

interests, water rights, accretion/reliction and rights to possession. As such, the types of

actions authorized by Rule 105 are significantly broader that what were historically

known as "quiet title actions."

As a rule of civil procedure, Rule 105 cannot "abridge, enlarge, nor modiff the

substantive rights of any litigants."C.R.S. $ 13-2-108. It is a maxim of Ruie 105 law that

a plaintiff must be prepared to show title in himself and cannot merely attack the

weakness of the defendant's title. Huston v. Agricultural Ditch & Resentoir Co.,723 P.2d

736 (Colo.l986).

il" . Mechanics of a Quiet Title Action

A. Public Records.

The recording statute is found at C,R.S. $ 38-35-109(1). It is a race-notice statute

which means that anyone purchasing property takes it subject to all documents recorded

in the clerk and recorder's office for that county that affect the property and all

documents and other items that the purchaser has actual knowledge of. Interested parties

with no actual or constructive knowledge of conveyances may rely on the clerk and

recorder's records. City of Lakewood v. Mavromatis, 817 P.2d 90 (Colo. l99l). Zoning

actions by local govemments do not require recording for constructive notice to be

imparted to all interested parties. South Creek Associates v. Bixby & Associates, Inc.,

781 P.2d'fi27 (Colo. 1989). Documents outside the chain of title do not impart notice

even though they are recorded in the clerk and recorder's office. Collins v. Scott, 943

P.2d 20 (Colo. App. 1996). If a recorded document refers to another document that is not

recorded, the unrecorded document will bind only the parties to that document and there

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ffi; is no duty to inquire regarding further details of the unrecorded document by those not

parly to it. C.R.S. $ 38-35-108.

The clerk and recorder's records are organized under a "Grantot-Grantee" index

which requires a tracing of title from grantee to grantor back as far as the title examiner

deems necessary, sometimes to the original patent for the United States. Modern title

plants maintained by title insurance companies are organized by tract. In other words, all

documents affecting a specific piece of properfy are posted against that properfy. As a

practical matter, most modern title searches in Colorado are conducted by title

companies. In some areas of the country, abstractors still prepare abstracts which are

then examined by attomeys who issue title opinions. This is becoming increasingly rare

as title insurance has become the norm nearly everywhere.

B. Off Record Matters

Actions occurring on the properfy can affect the title. By definition, these issues

cannot be discovered by searching the clerk and recorder's records. Tlpical issues that

occur include adverse possession, boundary acquiescence, oral agreements, prescriptive

easements, and easements by implication, necessity and estoppel. This outline deals with

many of these issues, below. One of the best ways to determine whether any of these

issues affect the property in question is to get a detailed survey. However, even the best

survey may not reveal every'thing.

C. Rule 105

(a) Complete Adjudication of Rights. An action may be brought for the purpose ofobtaining a complete adjudication of the rights of all parties thereto, with respect to any

real property and for damages, if any, for the withholding of possession. The court in its

decree shall grant full and adequate relief so as to completely determine the controversy

and enforce the rights of the parties. The court may at any time after the entry of the

decree make such additional orders as may be required in aid of such decree.

f(b) Record Interest; Actual Possession Requires Occupant to be Par1y. No personclaiming any interest under or through a person named as a defendant need be made aparty unless his interest is shown of record in the office of the recorder of the countywhere the real properly is situated, and the decree shall be as conclusive against him as ifhe had been made a party; provided, however, if such action be for the recovery of actualpossession of the property, the parfy in actual possession shall be made a party.

(c) Disclaimer Saves Costs. if any defendant in such action disclaims in his answerany interest in the property or allows judgment be taken against him without answer, theplaintiff shall not recover costs against him, unless the court shall otherwise direct,provided that this section shall not apply to a defendant primarily liable on anyindebtedness sought to be foreclosed or established as a lien.

(d) Execution of Quitclaim Deed Saves Costs. If a parfy, twenty days or more beforebringing an action for obtaining an adjudication of the rights of another person withrespect to any real property, shall request of such person the execution of a quitclaimdeed to such properfy and shall tender to such person $20.00 to cover the expense oftheexecution and delivery of a deed and if such person shall refuse or neglect to execute anddeliver such deed, the filing by such person of a disclaimer shall not avoid the impositionupon such person of the costs in the action afterwards brought.

(e) Set off for Improvements. Where aparty or those under whom he claims, holdingunder color of title adversely to the claims of another party, shall in good faith have madepermanent improvements upon real property (other than mining property) the value ofsuch improvements shall be allowed as a set-off or as a counterclaim in favor of suchparty, in the event that judgment is entered against such party for possession or damageslor withholding of possession.

({) Lis Pendens.(1) Filing and Notice. A notice of lis pendens may be recorded as provided

by statute.(2) Determination of Effect on Real Property. Any interested person may

petition the court in an action identified in the notice of lis pendens for a determinationthat a judgment on the issues raised by the pleadings in the pending action will not affectall, or a designated parly, of the real property described in the notice of lis pendens, or aspecifically described interest therein. After a hearing on such petition, the court shallmake findings of fact and enter an order setting forth the description of the property as

contained in the recorded notice of lis pendens and the description of the portion thereofor the interest therein, if any, the title to which will not be affected by judgment on theissues then pending in the action. Such order shall be a final judgment as to the mattersset forth therein and if the order includes the determination required by Rule 54(b) as toits finality apart from remaining issues, it shall be appealable only as a separate judgmentof that date.

(3) Disclaimer. Nothing in this Rule 105(f) shall be construed so as topreclude any parfy litigant from disclaiming an interest in all or any part of the real

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property affected by such notice of lis pendens, by filing with the court an instrument so

indicating, containing a reference to the notice of lis pendens by its recording data

sufficient to locate it in the records of the clerk and recorder. The filing of such

instrument with the court then having jurisdiction shall bar any further claims of said

party to such real properfy in said action.

(g) Description of Real Properfy. In any proceeding for the recovery of real properly

or interest therein, such properly shall be designated by a legal description.

Quiet title actions are brought to adjudicate all interests in a particular piece of

property. They can be brought to establish that your client is the owner of a piece of

property subject only to certain liens or no liens, as the case may be, and can also be

brought to adjudicate easements benefiting properfy, including access and utility

easements, or to alter the boundaries of a parcel of property. In Board of Commissioners

of Pitkin County v. Timroth, ST P.3d 102 (Colo. 2004), the Colorado Supreme Court held

that Rule 105 requires courts to adjudicate all claims regarding real property in one

action; therefore where the county presented eyidence that would support a claim for

reformation of a treasurer's deed, the court was bound to adjudicate that claim even

though it was not specifically pled. ("Thus, even though the pleadings do not raise a

particular issue, if the evidence before the court makes the issue apparent, the court must

reach that issue in order to grant fulI and appropriate relief.")

D. Investigation

Before filing a quiet title action, the plaintiff s lawyer must investigate the situation,

including the title to the client's property. See also $ 10, Researching Quiet Title Facts.

One good place to start is with the vesting deed. If the client cannot supply a copy, the

lawyer has some alternatives. Most counties in Colorado now have websites that allow

free or inexpensive searches of real property records. Links to county websites can be

found at http:/lwww.ccionline-orgllinks.htm, and from there it is usually fairly easy to

locate the properly records area or clerk and recorder's page, Many of these websites will 6

allow you to view and print recorded deeds.

E. Litigation Guaranty

Review of the vesting deeds for all properly potentially involved in a contemplated

quiet title suit is necessary, but it is only the beginning. Rule 105(b) and C.R.S. $ 38-35-

114 require that all parties with a record interest in the subject properfy be named as

parties by the plaintiff. The best way to ensure that all parties with a record interest are

identified is to contact a title insurance company that does business in the area where the

properly is located and order a "litigation guarantee." This is an insurance product

similar to a title insurance policy. It will list all the documents recorded against the

property in question. The insurance premium will be based on the amount of coverage.

This will usually, but not always, be the value of the property. The litigation guarantee €

will not only list the documents of record, but the title company will supply copies of the

documents as well. This is necessary because the lawyer will want to examine all the

documents and develop a list of all parties whose names appear in the record. They will

almost certainly become defendants in the upcoming lawsuit. Title companies will

update the litigation guarantee upon request and this should be done after the case is filed

to see whether additional parties obtained an interest in the subject properly from the time

of the original litigation guarantee to the time the lis pendens was recorded. Parties

obtaining an interest in the subject properly after the |is pendens is recorded will take

their interest subject to the outcome of the litigation, $ 6, below. If new parties appear,

the complaint should be amended to add them.

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F. Legal Description WDepending on the issues in the case, the legal description to be used in the complaint

will probably be the legal description found in the vesting deed of the subiect properfy.

However, in boundary disputes, adverse possession and prescriptive easement cases and

other claims involving only a portion of previously surveyed parcels, a legal description

may not be available. In these cases, a survey of the disputed parcel will almost certainly

be required. The Decree Quieting Title, which the court will issue at the conclusion of

the case must have a legal description of the property involved. Thompson v. Clarks,

Inc.,l62Colo. 506, 427 P.2d314 (1g67).Ideally, the plaintiff will obtain a survey before

the case is filed. If that is not possible, the plaintiff should plan on having the disputed

properry surveyed as soon after the complaint is filed as possible.

Another place the legal description iq required is in a lis pendens. C.R.S. $ 38-

35-110(1), C.R.C.P. 105(0(l). In order to put potential buyers and encumbrancers on

constructive notice of the litigation and so they will be bound by the results of the

litigation, the /rs pendens must have the proper legal description and without it, the /is

pendens is ineffective. 1d.

G. Jurisdiction and Venue

Jurisdiction for quiet title actions is in the district court despite the amount of money

in conrroversy. Colo. CONST. art. VI, $ 9; C.R.S. $ 13-6-105(1Xc). Venue is in the

county in which the subject property is located- C.R.C.P. 98(c).

The Colorado Court of Appeals upheld an adjudication of an adverse possessron

claim in the context of a Forcible Entry and Detainer action. The plaintiffs brought the

FED action in county court, but the case was removed to district court and adjudicated as

@,an FED case. Schuler v. Olderyik, 143 P.3d 1197 (Colo.App. 20Aq. On appeal,

defendants argued that the case should have been brought under Rule 105 as a quiet title

action. The court of appeals held that the trial court's actions were proper and rebuffed

the defendants' claims that they were denied due process because they were not given the

right to do discovery and have a full trial under the expedited FED procedures. The court

stated that the defendants could have filed a counterclaim under Rule 105 and/or

requested a delay of trial to conduct discovery under C.R.S. $ 13-40-114.

H. Default Judgment

Default judgments are a common occuffence in a quiet title case. Even if all the

named defendants answer, you'll still have to move for default of the unknown parties.

C.R.C.P. 55(a) empowers the clerk to enter a default against nonanswering parties. The

default judgment is entered by the judge and Rule 55 (b) and (f govern that procedure.

Further, Rule 121 $ 1-14 sets forth the items the court will require before entering

judgment. Review that rule carefully before moving for default judgment and make sure

you submit everything called for by the rule. The requirernents include the summons

showing service and affidavits demonstrating proper venue, that the defendant is not a

minor, incompetent person, in the military or an officer or agency of the State of

Colorado, the amount of damages in the case of a request for money damages, an

affidavit regarding attorneys' fees ifso requested and ifdefendant agreed to pay them or

ifthey are available pursuant to a statute.

The moving party should also submit a proposed form ofjudgment stating:

1. The name of the parly orparties to whom the judgment is granted.

2. The name of the parly or parties against whom the judgment is taken.

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3. Venue has been considered and is proper-

4. Ifjudgment is against multiple parties, whether the judgment is joint and several.

5. In the case of multiple parties, language complying with Rule 54(b) if frnal

judgment is sought against less than all defendants.

6. The principal amount, interest and attomey fees, if applicable, and costs which

shali be separately stated. C.R.C.P 121 $ 1-la(g).

$ l. The Decree

The decree is the final judgment in the quiet title case and is ultimate goal of the quiet

title plaintiff. It must recite the disposition of each party's interest in the subject

It must include a full caption with the full name of each parly in the case. This is not the

place to simply name the first defendant followed by "et. al." The decree must also list

the full name of each parly in the body of the decree and state that party's interest in the

properry- If it is none, the decree must say so.

The decree must also include a complete legal description of all property affected by

the decree- C.R.C.P. 105(9). The names and interests held, if any, by eachparly to the

action and the complete legal description must be included in the decree because the

p1aintiffwillrecordthedecreeintherea1estaterecordsandthe@

document affecting title to the subiect orogf, Following the court's entry of the decree,

the plaintiff should obtain a certified copy of the decree from the court clerk and record

that in the real properly records of the clerk and recorder for the counfy or counties in

which the property is located.

Rule 105(a) states that the court may make such additional orders as may be required

in aid of the decree. Such additional orders may be made "at any time." Maitland v.

Co<rt^ .on o,*'.'.,tJ /..f= c

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Board of County Comm'rs,707P.2d617,619 (Colo. App. 19Ba) (court amended 15 year

old quiet title decree.;.

Depending on the circumstances, C.R.C.P. 70, entitled "Judgment for Specific Acts;

Vesting Title," could be useful in enforcing a quiet title decree.

ilI. Parties and Service

A. Parties of Record and Parties in Possession

Rule 105(b) requires a quiet title plaintiff to name all parties with a record interest

in the subject properfy and all parties in possession. Anyone who claims an interest in the

properly through another person, but whose interest does not appear in the records will be

bound by the outcome of the lawsuit as long as the person under whom the claim is made

is named as a party. C.R.S. $ 38-35-114 is to the same effect. Thus, any person or entity

whose name appears in documents affecting title to the subject properly should be named as

as parties in the complaint. Scrutiny of the record documents is necessary to find not only

the names of all parties claiming an interest, but also any derivations of the names; for

example, "William Smith" versus "Bill Smith," the inclusion of a suffix such as "Jr." or

"III," or inclusion or deletion of middle initiats or middle names. If multiple permutations

of similar names appear, the best practice is to name them all, e.g., rtame both "William

Smith" and "Bill Smith." Also, when it is necessary to name multiple defendants, listing

them in alphabetical order can help organize the defendant group and make it easier to

keep track of them. If the plaintiff is challenging a deed of trust to the public trustee, the

person holding that office should be named. Likewise, if properfy taxes or a past tax sale

are at issue" the plaintiff should name the county treasurer as well.

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If the subject properly is located in an area covered by a homeowner's association,

the plaintiff should consider whether this will affect the parties to be named. For

example, if the quiet title action includes a claim for an easement crossing a record

easement in which members of the local HOA may have an interest, the association or

even all the individual property owners within the association may be necessary parties.

The question will probably tum on whether the subject properly is a "common element"

of the common interest community. C.R.S. $ 38-33.3-105(2) states that each unit in a

condominium or planned community with common elements has an ownership interest in

the common elements for assessment and taxation purposes.

Another scenario that could require naming all owners is litigation over restrictive

covenants. if the association is of a significant size, identifuing, naming, and serving

hundreds or possibly thousands of parties could make the proposed quiet title action

economically impossible. At least one case approved class action status as a way to deal

with this problem. Villa Sierra Condo. Ass'n v. Field Corp.,787 P.2d 661 (Colo. App.

1990) (approving class action certification fof, a case involving 200 unit owners).

B. Business Entites

Title to real properly is often held by legal entities rather than individuals. Many

real property owners elect to hold their real property in the name of legal entities to avail

themselves of certain tax benefits or as a method of limiting their personal liability.

Sometimes real properfy is also held by a trust for estate planning purposes. If a legal

entity holds un interest in real property, the initiatingparty of a quiet title action must

properly name and serve the legal entity as part of the action. See generall/ C.R.C.P. $$

4, 105(b).

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6Under Colorado law, legal entities that are registered with the Colorado Secretary

of State must designate someone to accept service of process on behalf of the entity. This

individual is referred to as the registered agent of the entity. Many foreign entities or

large companies use an agency to provide this service. The control persons (or the

founders) ofa legal entity in Colorado are required to designate an initial registered agent

of an entity in the controlling documents of the entity that are filed with the Colorado

Secretary of State (i.e., Ihe articles of incorporation in the case of a corporation or the

articles of orgarization in the case of a limited liability company). C.R.S. $$ 7-90-701,

7-90-803(0. The registered agent of a Colorado entify can be changed from time to time

by submitting a new filing with the Colorado Secretary of State. C.R.S. S 7-90-702.

The Business Center section of the Colorado Secretary of State's website contains

an electronic copy of the controlling documents for Colorado entities that are required to ^sregister The business center Website is available

htrp://www.sos.state.co.us/pubs/business/main.htrn. Before naming a Colorado entity in

a quiet title lawsuit, the practitioner should check the records of the Colorado Secretary

of State to determine if the entify is in good standing, suspended, or dissolved.

corporation's registered agent.Jhe corporation's articles of incorporation should state the_:

corporation's registered agent. If the corporation does not have a registered

or certifiedservice on the corporation can be accomplished istered

corporation's principal offices or as otherwise provided under the Colorado Rules of

Civil Procedure. C.R.S. g 7-90-7A4(2); C.R,C.P. +(e)( )(F) and (G).

agent,

mail to

then

the

Service of process

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Foreign corporations and foreign nonprofit corporations are served by delivering

the summons and complaint to the registered agent in Colorado as designated by the

corporation. Foreign corporations are required to designate a registered agent in this state

with the Colorado Secretary of State's office. Foreign corporations conducting only

passive activities in the state are not required to register with the secretary of state and do

not have to maintain a registered agent. For example, foreign corporations that ryLg&

hold title to real property are not required to register to do business in Colorado and

therefore do not maintain a registered agent in the state of Colorado. C.R.S. $ 7-90-

801(2). In that case, process can be served by delivery to the foreign corporation's

registeredagentasindicatedintherecordsofthb

jurisdiction or as otherwise provided in the Colorado Rules of Civil Procedure. C.R.C.P.

g a(e)(+)(F), (c) C.R.S. I l-90-704(2). Some foreign corporations doing business in

Colorado, which are not exempt from registration as a foreign corporation, will fail to file

a Statement of Foreign Authority. In that case, process can be served by delivery to the

corporation's registered agent as indicated in the records ofthe secretary of state in the

corporation's jurisdiction or as otherwise provided in the Colorado Rules of Civil

Procedure. C.R.C.P. $ a(e)(a)(F), (G)

Serving@scanbetrickier.Therulesdifferdependingonthe

year the corporation was dissolved. If a domestic business corporation has been

dissolved, either voluntarily or by operation of law, after January 7,7959, title to any

undisturbed properry remains in the corporation. See generally C.R.S. $ 7-114-105. If

the corporation was a business corporation dissolved after January 1,1959, and prior to

July 1, 1994,tb,e effective date of the Colorado Business Corporation Act, C.R.S. $$ 7-

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101-101 to 7-101-1 7J or a non-profit corporation dissolved after January 1, 1968, and

prior to Juiy l, 1998, the effective date of the Colorado Revised Nonprofit Corporation

Act, C.R.S. $$ 7-121-101 to 7-121-137 the undistributed property is subject to

conveyance by a majority of the surviving members of the last acting board of directors

"as named in the files of the secretary of state." C.R.S. $ 3s-30-171 (business

corporations); C.R.S. $ 38-30-173 (non-profit corporations). In most cases, because title

remains in the corporation, However, in the case of a corporation dissolved prior to

January 1,7959, title to properly of a dissolved corporation passed to and vested in the

directors who held such properly as trustees by operation of law. C.R.S. $ 31-6-5 (1953).

It is probably unnecessary to name the-last acting directors, even though the statute

provides that such directors are agents for process. But see 2 Ceruy S. KRlNoL,

ColoRaoo MEruoos oF PRACTICE S 74.6 (4th ed. 1998). Therefore, it is appropriate to

name the corporation including the words "a dissolved Colorado corporation" and the

year of dissolution and serve one of the last acting directors of the corporation.

If all the mern-bers of the last board of directors, as determined above, are

deceased, the public trustee of the counfy in which the real properry is located has

statutory authority to act for the dissolved corporation (profit or non-profit) in the

disposition of its properfy. C.R.S. $ 3S-30-171(3Xb). If this is the case, or if the starus of

the directors cannot be determined, name the public trustee in his or her capaciry as

"successor to the interests of xYZ corporation ." seealso c.R.S. $$ 38-37-10a(l)(g), 3g-

37-106; c.R.s. $ 38-30-171(3Xb); c.R.s. $ 38-30-173(3Xb). Title to any undistributed

properfy of domestic business corporations dissolved on or after July l, 1994, remains in

the corporation, and can be conveyed in the same manner as though the corporation were

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not dissolved. Sae C.R.S. $$ 7-i14-101 Io 7-114-109. By statute, the name of the

corporation is changed to include the words "a dissolved Colorado corporation" and the

year of dissolution. C.R.S- $ 7-90-601.5. Therefore, name the corporation as such and

deliver process to the last named registered agent according to the records of the

Colorado Secretary of State or, if none, by registered or certified mail delivered to the last

known principal address of the corporation. C.R.S, $$ 7-90-706 (the rules of service

continue to apply to dissolved entities), 7-90-704(2). Otherwise, it appears that process

can be served as provided under the Colorado Rules of Civil Procedure. C.R.C.P. 4(e),

(f)

Title to any undistributed properly of nonprofit corporations dissolved on or after

July 1, 1998, remains in the corporation, subject to disposal by the District Court for the

county in which the principal office of the corporation is then located, C.R-S. $ 7-134-

105(2). If the real properly owned by the dissolved nonprofit corporation is not located in

the same county as the principal office, then one possible solution is to file an action in

both counties and move to consolidate the action to the county in which the real properfy

is located. ,See C.R.C.P - 42, 42-7. By statute, the name of the corporation is changed to

include the words 'ia dissolved Colorado nonprofit corporation" and the year of

dissolution. C.R.S. $ 7-90-601.5. Therefore, name the nonprofit corporation as such and

deliver process to the last named registered agent according to the records of the

Colorado Secretary of State or, if none, by registered or certified mail delivered to the last

known principal address of the nonprofit corporation. C.R.S. $$ 7-90-706 (the rules of

service continue to apply to dissolved entities); 7-90-704(2). Otherwise, it appears that

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fprocess can be served as provided under the Colorado Rules of Civil Procedure.

C.R.C.P. a(e), (0.

A plaintiff can serve a domestic limited liability company in much the same way

as a domestic corporation; by serving the registered agent named by the LLC in the

secretary of state's office. In addition, it is proper to serve an officer, manager (if

management is vested in managers) or a member (if the LLC is member managed).

Check the LLC's articles of organization for management fype. A limited liability

company is required to maintain a registered agent in the state of Colorado or, in general,

it will be deemed to have authorized service of process on it by registered or certified

mailing to its principal business offices or as otherwise provided under the Colorado

Rules of Civil Procedure. C.R.S. 5 7-90-704(2); C.R.C.P. a(e)(a)(F), (c)

Service on a foreign limited liability company is obtained in the same marlner as

service on a domestic limited liability company. These companies must register with the

secretary of state and maintain a registered agent.

A dissolved limited liability company continues its existence but shall not carry

on any business except as is appropriate to wind up and liquidate its business and affairs.

These permitted activities include (among other activities) (i) "disposing of its properties

that will not be distributed in kind to its members;" and (ii) "distributing its remaining

property among its members." C.R.S. $ 7-80-803(b), (d). In theory, the operating

agreement of the dissolved limited liability company should control the disposition of the

company's property. If the dissolved limited liability company did not have an operating

agreement, then the disposition of the company's properfy will be controlled by each

member's ownership percentage in the company.

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After dissolution of the company, the manager or, if there is no manager, any

member may wind up the limited liability company's business, but on application of any

member, member's legal representative, or member"s assignee or transferee, the district

court, for good cause shown, may orderjudicial supervision of the winding up. C.R.S. $

7-80-803(b), (d). Note that the statute does not provide which district court will have

jurisdiction in such an action. Therefore, the district court for the county in which the real

property is located is probably the appropriate choice. The legal representative, assignee,

or transferee of the last remaining member may also wind up the limited liability

company's business. C.R.S, $ 7-80-803.3(2). By statute, the name of the company served

should be changed to include the words "a dissolved Colorado limited liability company"

followed by the year of dissolution. C.R.S. $ 7-90-601.5. Name the company as a

defendant with this suffix.

Service on a general partnership may be obtained either on the registered agent

listed in the partnership's frling with the secretary of state or upon any general partner.

C.R.C.P. a@)($. Service on domestic limited partnerships and limited liability limited

partnerships is likewise accomplished by sewing the entity's registered agent or by

serving a general parbrer. C.R.S. g 7-62-803 supplies the instructions on how to serve a

dissolved limited partnership.

Foreign limited partnerships, foreign limited liability limited partnerships foreiga

limited liability parhrerships can be served through their registered agents. In the absence

of a domestic registered agent, the parlnership can be served via its registered agent in its

home jurisdiction. Because the entity is a partnership, sewice on a general partner will be

adequate.

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*,lzh'for,:oa"

0Serving_process on a trust is most often accomplished by serving a trustee.

C.R.C.P. a@)@). Some trusts require registration in probate court and that will include

the name and address of the trustee. Deeds conveying real property to trusts generally

identifu the name of the trustee ald the name and date of the trust.

The Colorado Supreme Court recently expanded the number of opinions in

the Taylor Ranch case. Lobato v. Taylor,70 P.3d 1152 (Coto. 2003). That case involves

the Taylor Ranch on the east side of the San Luis Valley in southern Colorado and the

adequacy of a 1960 Torrens Title registration procedure. Registration of property under

the Torrens Act requires a notice procedure quite like that required in a quiet title action.

This it the most recent of three opinions the Colorado Supreme Court has issued in this

ongoing dispute. The most recent opinion addresses the question of which parties should

have been personally served in the 1960s Torrens Title action. The court concluded that

all properly owners of Costilla County at the time of the action should have been

personally served. At that time, the property owners in that county numbered 1,913. The

court held that the property owner bringing the Torrens Title action should have checked

the county assessor's records when doing the title search. The effect this case will have

on quiet title actions remains to be seen, but it may very well provide parties that weren't

notified of a quiet title action with arguments as to why such actions should be set aside

after the fact"

C. Unknown

Quiet title

Parties

0

appears in C.R,C.P.

an interest in the

complaints tlpically name "all unknown parties." This language

9(a)(3) and l0(a) and is meant to bring in all parries who might claim

land, but whose names are not listed in the real estate records.

t8

a

.,I

ffi Designating unknown parties is not a substitute for naming parties who hold a record

interest in the land. If a parfy with a record interest in the land is not named, the quiet title

action will not affect that person's interest. Robinson v. Clauson, 142 Colo. 434,351P.2d

257,26A (1960). In fact, Lobato reinforced this principle. After Lobato it is hard to

imagine the tlpe of party that would fall into the "unknown parfy" category whose

interest could be eliminated by naming him or her as such. But, to be safe rather than

sorry, it's still a good idea to name "all unknown parties."

D. Servicemembers' Civil Relief Act

The Servicemembers Civil Relief Act 50 App. U.S.C. $$ 501 to 596. (formally

known as the Soldiers' and Sailors'Relief Act of 1940) addresses a wide range of issues

including servicemembers' ownership of real estate and personal properfy, as well as life

insurance, taxes, entry on public lands, health insurance issues and other matters, The

area of most concern for quiet title practitioners is the Act's provisions dealing with

default judgments.

50 App. U.S.C. $ 521 applies to any civil action in which the defendant does not

make an appearance 50 App. U.S.C. $ 521(a). In that event, the act requires the plaintiff

to file an affidavit of military sewice when attempting to obtain a default judgment. 50

App. U.S.C. $ 522(bX1). The affidavit must state whether the defendant is in the military

service and show facts supporting the conclusion 50 App. U.S.C. $ 521(bXl)(A) or, if the

plaintiff cannot determine whether the defendant is in the military, stating as much 50

App. U.S.C. $ 521(bXlXB). If the defendant is in the military, the court cannot enter a

judgment against that defendant until after the court appoints an attorney to represent the

defendant 50 App. U.S.C. $ 521(bX2). If the appointed attomey cannot locate the

iffi

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