Glenwood Springs, CO (May 6) – In a written order issued today, Garfield County District Court Judge James Boyd has ruled that a lease between SourceGas and Colorado Mountain College is void and unenforceable. SourceGas sought to lease five acres of land on the college’s campus in Spring Valley for the purpose of building a natural gas compressor station; CMC’s Board of Trustees voted not to recognize the lease because it did not comply with statutory restrictions on the leasing of junior college district property.
While SourceGas argued that the lease was enforceable and that it was entitled to damages for the college’s decision not to recognize the lease, Judge Boyd disagreed and granted CMC’s motion for summary judgment, or dismissal, because the lease was void under the statute. In his ruling, Judge Boyd wrote “that CMC did not have the authority to enter the Lease” because the Lease term is longer than the three years permitted under Colorado’s junior college statutes and CMC Board of Trustees did not approve the Lease. Judge Boyd also ruled that the Court did not have the authority to rewrite the Lease to a three year term as SourceGas attorneys had argued. Finally, Judge Boyd ruled that finding the Lease was void and unenforceable was not grossly inequitable to SourceGas because CMC has returned the entire amount of the Lease payment to SourceGas. Judge Boyd previously ruled on Aug. 7, 2012 that the court could not order CMC to perform the lease.
“We are pleased that this issue has been resolved by the court, and we can concentrate on the business of educating students,” says CMC Board of Trustees President Glenn Davis. In addition to addressing the college’s authority to enter into the SourceGas lease, he noted, “the college Board was responding to concerns raised by students, faculty and area residents when it decided not to go forward with the lease.”
Even though CMC already had a policy in place regarding leases of CMC property, the Board recently adopted a more detailed policy requiring acquisitions and dispositions of CMC’s real property to ensure compliance with Colorado’s junior college statute. The review of leases must result in a finding that the property is not immediately needed for CMC purposes, and that the lease “promotes the general welfare of the institution and is in the best interests of education and the junior college district,” pursuant to state law.