The Colorado  Supreme Court held that the non-developer owner of a parking space did not receive an unrestricted title that would allow it to sell the space to a third party non-condominium owner B.B. & C. v. Edelweiss Condominium, 218 P.3rd 310 (Colo. 2009)

The developer built a 21 unit complex that had thirty parking spaces. One parking space was conveyed to each condominium unit, leaving ten unassigned. The condominium Declarations allowed the developer to sell the unassigned spaces to condominium owners or to third party non-condominium owners. Under the Declarations no other person other than the developer was able to sell or lease a parking space to a non-owner.

In 1971, Edward Lana, an owner of a unit, purchased parking space no. 21 from the developer. Lana sold his unit and two parking spaces in 1972, but maintained ownership of parking space 21. Two years later he sold space 21 to Justin and Isabella Lana (the “Lanas”) who were owners of a unit in the complex.

The Lanas then sold their unit with its two spaces, but maintained ownership of space 21 after the sale. A year later they sold the parking space to the Plaintiff, B.B. & C.,  via a warranty deed, which contained language that made the conveyance subject “to the terms, covenants, conditions, easements and restrictions, uses, limitations and obligations set forth in the Declarations.”   Because the Lanas were not the developer nor was the B.B. & C. an owner, the conveyance of space 21 violated the requirement that only the developer could sell or lease the parking space.

B.B. & C. owned the space for over twenty years, paid all taxes, maintenance fees and insurance fees during this period and appeared to be able to take adverse possession of the property under color of title. Section 38-41-108. C.R.S.

In 2003, the Condominium Association adopted an Amended Declaration which declared the Association members (“owners”) to be the owner of space 21 as a general common element, and excluded B B. & C. access to parking space 21.

B. B. & C. filed a quiet title action claiming unrestricted  fee simple ownership of the parking space by adverse possession under color of title pursuant to sections 38-41-108, and the right to sell the space regardless of the restriction in the Deed.

The trial court ruled that the Amended Declarations changing ownership to the members of the Association and denying CPM access was unconscionable and voided the Amended Declarations. The Court of Appeals, in an unpublished opinion, reversed the trial court and held that the Amended Declarations was a valid amendment, but as a bone, gave  B. B. & C. its costs and attorney fees.

B. B. & C. appealed. The Supreme Court affirmed the court of appeals decision on different grounds. It went on to say that under section 38-41-108 C.R.S., if the party proves all the elements it is entitled to judgment of legal ownership, but only to the extent and according to the purport of the title.

Section 38-41-108  Every  person in the actual possession of the lands, … under claim and color of title, made in good faith,who for seven successive years continues in such possession and also during said time  pays all taxes legally assessed on suchlands … shall be held and adjudged to be the legal owner of saidlands to the extent and according to the purport of his paper title.

The Supreme Court said the trial court and the appellate court did not need to reach the issue of the Amended Declarations’ applicability to the case at issue.  It held that the original Declaration incorporated into B. B. &.C’s deed precludes B. B. & C from obtaining an unrestricted fee simple estate in the parking space.

The Supreme Court said, on remand to the trial court, that B. B. & C., regardless of the Amended Declarations could obtain a quiet title judgment recognizing its ownership of the parking space. But it would not be entitled to a judgment for an unrestricted fee simple estate; it could not obtain under color of a title any more rights than it was deeded. It would be the owner of the space, but it would only be allowed to sell or lease it to members of the Condominium Association as restricted by the deed. It was only entitled to ownership of the space to the extent and according to the purport of his paper title. subject to the terms, covenants, conditions, easements and restrictions, uses, limitations and obligations set forth in the Declarations.