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The Group Inc. v. Spanier6/26/1997
In this action to collect on a check returned because of insufficient funds, defendant, Judith A. Spanier, appeals the summary judgment in favor of plaintiff, the Group, Inc. (Group). We reverse and remand with directions.
Group was the listing broker for a real estate transaction in which Spanier was buyer. Spanier sent a $10,000 check to Group as an earnest money deposit. Without waiting for Spanier's check to clear, Group sent its own check for $10,000 to seller. Spanier's check did not clear and the real estate transaction was never completed.
Later, Group served Spanier with a written notice that her check had failed to clear, and it demanded payment pursuant to § 13-21-109, C.R.S. (1996 Cum. Supp.). Group's notice claimed that the following amounts were payable as a result of the returned check: (1) the $10,000 face value of Spanier's check; (2) a $20 returned check charge; and (3) $175 in collection/attorney fees. The notice listed the total amount due as $10,195.
The notice also contained an advisement that, if Spanier failed to pay the amount listed within fifteen days, she could be found liable for three times the face amount of the check, plus attorney fees and costs.
When Spanier failed to pay within fifteen days, Group filed this action in which it sought, pursuant to § 13-21-109(2)(a), C.R.S. (1996 Cum. Supp.), an award of damages equal to three times the face value of the check. The trial court granted Group's motion for summary judgment and awarded it three times the face amount of the check, plus attorney fees and costs.
Spanier contends the trial court erred in determining that: (1) she had waived her right to assert defects in the notice by failing to inform Group of such alleged defects within fifteen days after receipt of the notice; and (2) the notice sent by Group was sufficient under § 13-21-109(4), C.R.S. (1996 Cum. Supp.). We agree with both contentions.
I. Strict Compliance
As pertinent here, § 13-21-109(1), C.R.S. (1996 Cum. Supp.) provides that a person who obtains money, merchandise, property, or other thing of value, or who makes any payment of any obligation by means of making any check which is not paid upon its presentment (a dishonored check), is liable to the holder of such check for the face value of the check plus additional charges permitted under the statute.
Section 13-21-109(2)(a), C.R.S. (1996 Cum. Supp.) further authorizes a holder or assignee of a dishonored check to file a civil action for three times the face value of the check. However, before bringing such an action, the holder or assignee of the check must provide notice to the maker of the check in the manner prescribed in §§ 13-21-109(3) and 13-21-109(4), C.R.S. (1996 Cum. Supp.). The notice must inform the maker of the check that he or she has fifteen days to pay the amount due or risk liability for treble damages.
Section 13-21-109(4) specifies that the contents of the notice must include the date the check was issued; the name of the bank, depository, person, firm, or corporation on which it was drawn; the name of the payee; the face amount; and a statement of the total amount due, which shall be itemized and shall not exceed the amount permitted under the statute.
Failure to comply with these statutory notice provisions precludes the collection of treble damages. See § 13-21-109(2), C.R.S. (1996 Cum. Supp.); Stadler v. Devito, 931 P.2d 573 (Colo. App. 1996).
In determining whether a statutory notice requirement has been satisfied, courts require a degree of compliance consistent with the objective sought to be achieved by the legislation under consideration. W
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