COLORADO COURT OF APPEALS                                         2017COA16

Court of Appeals No. 16CA0723
Eagle County District Court No. 15CV30255
Honorable Russell H. Granger, Judge


Traer Creek-EXWMT LLC, a Colorado limited liability company,

Plaintiff-Appellant,

v.

Eagle County Board of Equalization,

Defendant-Appellee.


                           JUDGMENT AFFIRMED

                                  Division II
                        Opinion by JUDGE J. JONES
                        Dailey and Berger, JJ., concur

                         Announced February 9, 2017


Otten, Johnson, Robinson, Neff & Ragonetti, P.C., Dimitri Adloff, David P.
Hutchinson, Denver, Colorado, for Plaintiff-Appellant

Bryan Treu, County Attorney, Christina Hooper, Assistant County Attorney,
Eagle, Colorado, for Defendant-Appellee
¶1    Plaintiff, Traer Creek-EXWMT LLC (Traer), appeals the district

 court’s judgment dismissing its claims against defendant, Eagle

 County Board of Equalization (the Board), for lack of standing.

 Because we conclude that a mere lessee of property (such as Traer)

 does not have standing to challenge a property tax valuation of

 property that includes the leased property, we affirm.

                            I. Background

¶2    This appeal concerns the property tax valuation of Chapel

 Square Subdivision Tract B-1 (Tract B) for the tax year 2015. Tract

 B is a parcel of land that has a commercial retail building on it.

 Tract B has been subject to a lease since 1987, and since 2002

 Traer has been the lessee.1 Under a “Declaration of Easements,”

 Traer is contractually obligated to pay the property taxes “directly to

 the appropriate taxing authorities.” But since assuming the lease,

 Traer has not paid the property taxes directly to the taxing

 authority; the owner has made those payments and Traer has

 reimbursed the owner.




 1The parties appear to dispute whether the lease covers all of Tract
 B, but we do not need to resolve that dispute.

                                    1
¶3    On May 1, 2015, the Eagle County Assessor mailed the owner

 a notice of valuation regarding Tract B. Traer (but not the owner)

 initiated the statutory protest and adjustment process to challenge

 the 2015 valuation of Tract B. The assessor issued a notice of

 determination declining to adjust the valuation.

¶4    Traer appealed the notice of determination to the Board. The

 Board upheld the valuation.

¶5    Undaunted, Traer appealed the Board’s decision to district

 court pursuant to section 39-8-108, C.R.S. 2016.2

¶6    The Board moved to dismiss under C.R.C.P. 12(b)(1) on the

 theory that a mere lessee does not have standing to challenge a

 property tax valuation of the sort issued by the assessor. The

 district court agreed and dismissed the case.

                            II. Discussion

¶7    Traer contends that the district court erred in ruling that it

 does not have statutory or common law standing, and that factual




 2 Traer joined CSB Properties Holdings LLC, one of the owners, as a
 defendant because CSB declined to join as a plaintiff. CSB did not
 file an answer or other pleadings, and the district court entered a
 “clerk’s default” against CSB.

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  determinations underlying the court’s ruling are incorrect. We

  address and reject each contention in turn.

                            A. Statutory Standing

                1. Standard of Review and Applicable Law

¶8     We review questions of standing and statutory interpretation

  de novo. 1405 Hotel, LLC v. Colo. Econ. Dev. Comm’n, 2015 COA

  127, ¶ 36; Krol v. CF & I Steel, 2013 COA 32, ¶ 15 n.2.

¶9     Our primary goals in interpreting a statute are to discern and

  give effect to the General Assembly’s intent. Krol, ¶ 15.

             We look first to the statutory language, giving
             the words and phrases used therein their plain
             and ordinary meanings. We read the language
             in the dual contexts of the statute as a whole
             and the comprehensive statutory scheme,
             giving consistent, harmonious, and sensible
             effect to all of the statute’s language.

  Id. (citation omitted).

                                 2. Analysis

¶ 10   Traer argues that because it “owns” an interest in property —

  albeit a leasehold interest — it has standing under the statutory

  scheme to object to and protest a valuation. To show why Traer is

  wrong, we walk through the objection and protest process laid out

  by the applicable statutes, beginning with the notice of valuation.


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¶ 11   Section 39-5-121(1)(a)(I), C.R.S. 2016, provides that “the

  assessor shall mail to each person who owns land or improvements

  a notice setting forth the valuation of such land or improvements.”

  When the valuation in question concerns the fee interest in real

  property, the statutory phrase “owns land” is most naturally

  understood as referring to a fee owner, not someone with a mere

  leasehold interest in property. Thus, only the fee owner of real

  property need be notified of a tax valuation of that owner’s real

  property.

¶ 12   This understanding of owner in this context is confirmed by

  section 39-5-102(1), C.R.S. 2016, which says that “[o]wnership of

  real property shall be ascertained by the assessor from the records

  of the county clerk and recorder.” Such records typically identify

  fee owners, but not necessarily lessees.3 And this understanding

  also makes sense in light of the fact that only fee owners of real

  property are liable to the taxing authority for taxes assessed

  pursuant to a valuation of real property. See Cantina Grill, JV v.


  3 Traer notes that the Declaration of Easements describing the
  lessee’s tax obligation was recorded in the county land records.
  However, this document was not recorded to demonstrate
  ownership, and Traer is not mentioned in the document.

                                     4
  City & Cty. of Denver Cty. Bd. of Equalization, 2015 CO 15, ¶ 20

  (even if there are taxable interests in property that are less than fee

  ownership, the property is taxed to the fee owner).

¶ 13     Section 39-5-122(1)(a), C.R.S. 2016, outlines the “[t]axpayer’s

  remedies to correct errors” after valuation. It reads in relevant part

  that

              after notices of adjusted valuation are mailed
              to taxpayers, the assessor will sit to hear all
              objections and protests concerning valuations
              of taxable real property determined by the
              assessor for the current year; [and] that, for a
              taxpayer’s objection and protest to be heard,
              notice must be given to the assessor.

  The reference to “notices . . . mailed to taxpayers” clearly refers to

  the notices mailed pursuant to section 39-5-121(1)(a)(I). Since

  those notices are, with respect to real property, mailed to owners,

  and “owners” in this context means fee owners, “taxpayers” as used

  in section 39-5-122(1)(a) means those fee owners to whom the

  assessor sent notices.

¶ 14     Under subsection (2) of section 39-5-122, “[i]f any person is of

  the opinion that his or her property has been valued too high, . . .

  he or she may appear before the assessor and object.” Considered

  in conjunction with subsection (1), a “person” referred to in


                                      5
  subsection (2) is a “taxpayer.” And as discussed, a taxpayer to

  whom a notice of valuation of real property has been sent is a fee

  owner. At least this is so when the valuation is of the fee interest in

  the land, as it was in this case, for the objection may be made only

  as to the “property” that “has been valued.” An assessor values real

  property as a whole, regardless of any leasehold interests in the

  property, and the fee owner is responsible for paying the tax.

  Cantina Grill, ¶ 20.

¶ 15   Thus far, therefore, this much is clear: the fee owner is the

  only party given statutory standing to object to and protest the

  assessor’s valuation of real property in fee. And once the assessor

  decides such an objection and protest, the statutes governing

  further review of that decision make clear that they do not expand

  the class of persons with standing.

¶ 16   Under section 39-8-106, C.R.S. 2016, the county board of

  equalization must “hear petitions from any person whose objections

  or protests have been refused or denied by the assessor.” The

  “person” referred to in this section is plainly the “person” who had

  standing to first object to and protest the valuation with the

  assessor under section 39-5-122. If “the petitioner’s” petition is


                                     6
  denied by the board, section 39-8-108 allows “the petitioner” to

  appeal that denial. The “petitioner” is the “person” who filed the

  petition under section 39-8-106; that “person” is the “taxpayer” who

  objected under section 39-5-122; and that “taxpayer” is, in turn,

  the owner who received the notice of valuation pursuant to section

  39-5-121. See Tenney v. Bd. of Assessment Appeals, 856 P.2d 89,

  91 (Colo. App. 1993) (“[T]he term ‘petitioner,’ as used in these

  statutes, has been interpreted as meaning the taxpayer for the

  property.”).

¶ 17   In sum, the relevant statutes expressly limit the right of review

  in this context to a property owner to whom a notice of valuation is

  sent as required by statute. “[W]hen a statute creates a cause of

  action and designates those who may sue under it, none except

  those designated may sue,” and “we are without authority to

  expand [that class].” Berry Props. v. City of Commerce City, 667

  P.2d 247, 249 (Colo. App. 1983); see Tenney, 856 P.2d at 90 (“If a

  statute designates those who may bring an action, only those

  parties so designated have standing to do so.”).

¶ 18   We are not persuaded to the contrary by Traer’s argument that

  because section 39-1-102(16), C.R.S. 2016, defines “taxable


                                     7
  property” as including “all property, real or personal, not expressly

  exempted from taxation by law,” and since section 39-1-102(14)

  defines “real property” as including “all . . . interests in lands,” it

  may challenge any assessment relating to the underlying property

  under section 39-5-122. Even if Traer is a “person” as that term is

  defined in section 39-1-102(9), it is not a person whose “property

  has been valued too high.” § 39-5-122(2). The assessor did not

  separately value Traer’s alleged “property” — its leasehold interest;

  the assessor valued the fee ownership interest in the property.

  Traer does not have such an interest.

¶ 19   Traer’s reliance on cases addressing abatement and refund

  proceedings4 is equally misplaced. Traer is not seeking a tax

  abatement and refund — a process that occurs after the property

  tax is paid. Rather, Traer seeks to protest and adjust the property

  valuation, which is a procedure that occurs before the tax is paid.

  4 See Hughey v. Jefferson Cty. Bd. of Comm’rs, 921 P.2d 76, 79
  (Colo. App. 1996) (purchaser of a tax lien did not have standing to
  petition for abatement); Wyler/Pebble Creek Ranch v. Colo. Bd. of
  Assessment Appeals, 883 P.2d 597 (Colo. App. 1994) (taxpayer
  sought abatement); Telluride Reg’l Airport Auth. v. Bd. of
  Equalization, 789 P.2d 201 (Colo. App. 1989) (lessee had standing
  to petition for abatement under § 39-9-108); Gunnison Cty. v. Bd. of
  Assessment Appeals, 693 P.2d 400 (Colo. App. 1984) (county
  sought property tax abatement).

                                      8
  These two procedures are not identical as “[t]he protest and

  adjustment procedures and the abatement and refund procedures

  are separate and independent administrative procedures for the

  adjudication of property tax disputes which are governed by

  different statutes.” Wyler/Pebble Creek Ranch v. Colo. Bd. of

  Assessment Appeals, 883 P.2d 597, 599 (Colo. App. 1994); see

  Huerfano Cty. Bd. of Cty. Comm’rs v. Atl. Richfield Co., 976 P.2d

  893, 896 (Colo. App. 1999) (same).

¶ 20   Therefore, based on the plain language in the statutes

  governing valuation protest and adjustment, we conclude that the

  district court did not err in ruling that Traer lacks standing to

  challenge the valuation of Tract B.

                       B. Common Law Standing

¶ 21   Traer contends that it has standing under common law

  principles because it pays the taxes on Tract B, and because the

  land owner granted it agency authority to challenge the valuation.

¶ 22   Traer’s contention falters at the outset because when a statute

  limits standing to bring a particular kind of action, a court may not

  effectively disregard that limitation by employing notions of

  common law standing. Tenney, 856 P.2d at 90; Berry Props., 667


                                     9
  P.2d at 249. As discussed, the relevant statutes deny Traer

  standing.5

                           C. Factual Findings

¶ 23   Traer contends that the district court improperly adopted the

  Board’s factual assertions regarding the amount of space Traer

  leases and the amount of tax liability for which Traer is directly

  responsible under the Declaration of Easements. But the amount

  of leased space and Traer’s liability to the owner are irrelevant to

  the question of standing under the governing statutes. So any error

  as to those facts is harmless. See C.R.C.P. 61.

                             III. Conclusion

¶ 24   The judgment is affirmed.

       JUDGE DAILEY and JUDGE BERGER concur.




  5 We also observe that the letter allegedly granting Traer agency
  authority is not typed on letterhead, and it is unclear who signed
  the letter as the signature is illegible and there is no printed
  signature. Further, the property was owned by two separate
  entities during tax year 2015, and Traer has never claimed to have
  permission from CSB to appeal the valuation. In fact, CSB has
  been unresponsive through the valuation appeal process. Traer
  joined CSB as a co-defendant in this case. We will not interpret
  CSB’s unresponsiveness as granting Traer authority to act as its
  agent.

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