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18-4-405. Rights in stolen property.

Text

All property obtained by theft, robbery, or burglary shall be restored to the owner, and no sale, whether in good faith on the part of the purchaser or not, shall divest the owner of his right to such property. The owner may maintain an action not only against the taker thereof but also against any person in whose possession he finds the property. In any such action, the owner may recover two hundred dollars or three times the amount of the actual damages sustained by him, whichever is greater, and may also recover costs of the action and reasonable attorney fees; but monetary damages and attorney fees shall not be recoverable from a good-faith purchaser or good-faith holder of the property.

History

History.
Source: L. 71: R&RE, p. 429, 1.C.R.S. 1963: 40-4-405. L. 73: P. 536, 1. L. 87: Entire section amended, p. 668, 1, effective July 1.

Annotations

ANNOTATION

Law reviews. For article, The Law of Trade Secrecy and Covenants Not to Compete in Colorado-Part I, see 30 Colo. Law. 7 (Apr. 2001). For article, Treble Damages for Civil Theft in Colorado After Itin v. Ungar, see 31 Colo. Law. 49 (Mar. 2002). For article, Bona Fide Purchasers of Real Property: Fraud is Not Civil Theft, see 32 Colo. Law. 101 (Dec. 2003).

Section conflicts with Uniform Commercial Code, 4-2-403, which holds that a good faith purchaser takes valid title from a person who obtained voluntary delivery from a seller in exchange for a check that is later dishonored. UCC section prevails because it was later in time and because original owner was in a better position to protect his or her interests than the subsequent good faith purchaser. West v. Roberts, 143 P.3d 1037 (Colo. 2006).

The economic loss rule does not preclude a cause of action under this section. Bermel v. BlueRadios, Inc., 2017 COA 20, 442 P.3d 923, affd, 2019 CO 31, 440 P.3d 1150.

Section should not be read as a codification of the remedy of replevin or as a delineation of the grounds for creating a constructive trust. In re Allen, 724 P.2d 651 (Colo. 1986).

Return of property does not necessarily preclude a finding of wrongful intent nor purge the defendant of guilt. Ziegler v. Inabata of Am., Inc., 316 F. Supp. 2d 908 (D. Colo. 2004).

Although funds from a Ponzi scheme were obtained by theft, the subsequent transfer of these funds by the debtor represented the transfer of an interest of the debtor in property for purposes of a chapter 7 bankruptcy action. In re M & L Bus. Mach. Co., Inc., 160 B.R. 851 (Bankr. D. Colo. 1994), affd, 167 B.R. 219 (Bankr. D. Colo. 1994).

This section was intended to be a punitive measure depriving thieves and persons who buy and sell stolen goods of the immediate fruits of their criminal activities. In re Allen, 724 P.2d 651 (Colo. 1986); Montoya v. Grease Monkey Holding Corp., 883 P.2d 486 (Colo. App. 1994).

Employer of taker of property, never having had possession of the property and not being involved in criminal activity, was not subject to this section. Montoya v. Grease Monkey Holding Corp., 883 P.2d 486 (Colo. App. 1994).

The requisite burden of proof for awarding treble damages under this section is the preponderance of evidence standard rather than the higher burden used in criminal matters of beyond a reasonable doubt. In re Dorland, 374 B.R. 765 (Bankr. D. Colo. 2007).

Actual damages include noneconomic damages as well as economic damages. Gorsich v. Double B Trading Co., Inc., 893 P.2d 1357 (Colo. App. 1994).

Trial court did not err in concluding that under this section a rightful owner could not recover from a vendor funds belonging to a company that had been embezzled and used to purchase and improve property the vendor reacquired after embezzlers default on a land contract, as vendor no longer had possession of company funds. Cedar Lane Inv. v. Am. Roofing, 919 P.2d 879 (Colo. App. 1996).

Damages may be obtained under this section without proof that the taker of stolen property was convicted of theft, burglary, or robbery. Chryar v. Wolf, 21 P.3d 428 (Colo. App. 2000); Itin v. Bertrand T. Ungar, P.C., 17 P.3d 129 (Colo. 2000).

This statute provides an owner with a private remedy against the taker that requires proof of a specified criminal act but not proof of a prior criminal conviction to recover treble damages, fees, and costs. Itin v. Bertrand T. Ungar, P.C., 17 P.3d 129 (Colo. 2000).

If all of the conditions leading to the award of treble damages have already occurred, then the award of those damages is not contingent, and, if the damages are readily ascertainable, they are liquidated. It is appropriate, therefore, to consider the inclusion of treble damages in calculating debtors eligibility for chapter 13 bankruptcy relief under 11 U.S.C. 109(e). In re Krupka, 317 B.R. 432 (Bankr. D. Colo. 2004).

The award of treble damages is not discretionary. Because the language of this section speaks in terms of what the owner may recover as opposed to what the court may award, the statutory language does not support the argument that discretion lies with the trial court to either award treble damages or not as it may deem appropriate. It is appropriate, therefore, to consider the inclusion of treble damages in calculating debtors eligibility for chapter 13 bankruptcy relief under 11 U.S.C. 109(e). In re Krupka, 317 B.R. 432 (Bankr. D. Colo. 2004).

There was no justification for assessing the criminal penalty of treble damages, attorney fees, and costs where plaintiff did not prove all the components of theft by a preponderance of the evidence. Although there was a violation of 38-26-109, resulting in an award of actual damages, there was no proof, evidence, or finding of conduct necessary to show criminal conduct or criminal liability under applicable Colorado case law. In re Dorland, 374 B.R. 765 (Bankr. D. Colo. 2007).

Attempt to collect damages unavailing where there was no showing of a criminal act. In re Duran, 483 F.3d 653 (10th Cir. 2007).

Restaurant owners who intentionally intercepted satellite signal to broadcast fight program without paying sub-licensing fee violated this section. Kingvision Pay-Per-View, Ltd. v. Gutierrez, 544 F. Supp. 2d 1179 (D. Colo. 2008).

Plaintiff not entitled to damages under this section, however, because court awarded it statutory damages under the Federal Communications Act, 47 U.S.C. 605. Any award under this section would therefore constitute impermissible double recovery for the same injury. Kingvision Pay-Per-View, Ltd. v. Gutierrez, 544 F. Supp. 2d 1179 (D. Colo. 2008).

Court properly dismissed plaintiffs claim for civil theft for failure to state a claim under C.R.C.P. 12(b)(5). The only allegation regarding the defendants mental state is a single, conclusory statement that the defendant acted with the necessary mental state. That alone is not enough to sufficiently plead the requisite intent. Scott v. Scott, 2018 COA 25, 428 P.3d 626.

When two state law claims provide duplicative relief, it is useful to frame the analysis as a multi-factor test where no one factor is determinative. The relevant factors include, but are not limited to, the elements of the claims asserted, the wrongful conduct underlying those claims, and the statutory framework (if any) of the claims. In re McGill, 623 B.R. 876 (Bankr. D. Colo. 2020).

Claimant may not recover misspent trust funds under both this section and 38-26-109. In re McGill, 623 B.R. 876 (Bankr. D. Colo. 2020).

This section does not authorize recovery against a good faith purchaser who holds record title to real property earlier conveyed under fraudulent circumstances. Strekal v. Espe, 114 P.3d 67 (Colo. App. 2004).

The statute of limitations in 13-80-102, and not that in 16-5-401 (1)(a), applies to a theft claim brought under this section. Michaelson v. Michaelson, 923 P.2d 237 (Colo. App. 1995).

This section imposes a statutory penalty within the meaning of C.R.C.P. 98, requiring that the action be tried in the county where the claim arose. Ehrlich Feedlot, Inc. v. Oldenburg, 140 P.3d 265 (Colo. App. 2006).

Award of reasonable attorney fees to a prevailing plaintiff on a civil theft claim is mandatory. Steward Software Co. v. Kopcho, 275 P.3d 702 (Colo. App. 2010).

Judgment against debtor under this section is a nondischargeable debt under 11 U.S.C. 523. In re Oltmann, 505 B.R. 311 (Bankr. D. Colo. 2014); In re Chisan Chong, 523 B.R. 236 (Bankr. D. Colo. 2014).

Applied in In re Allen, 691 P.2d 749 (Colo. App. 1984); In re McGill, 623 B.R. 876 (Bankr. D. Colo. 2020).