TRUETT L. SCARBOROUGH, Plaintiff-Appellee,
ANGEL FIRE RESORT OPERATIONS, LLC, a New Mexico Limited Liability Company, Defendant-Appellant.
FROM THE DISTRICT COURT OF COLFAX COUNTY John M. Paternoster,
Stephen C.M. Long Albuquerque, NM Jeffery L. Thomason Angel
Fire, NM for Appellee
L. Brand & Associates, P.C. Karla K. Poe Albuquerque, NM
Rodey, Dickason, Sloan, Akin & Robb, P.A. Edward Ricco
Albuquerque, NM for Appellant
Neelley, P.C. Carol A. Neelley Santa Fe, NM for Amicus Curiae
Association of Angel Fire Property Owners
MONICA ZAMORA, JUDGE
Defendant has filed a motion for rehearing in this matter,
which has been considered by the original panel, and is
hereby granted. The opinion filed July 28, 2017, is hereby
withdrawn and this opinion is filed in its stead.
Defendant Angel Fire Resort Operations, L.L.C. (the Resort),
appeals the district court's orders granting summary
judgment to Truett L. Scarborough (Plaintiff), and denying
summary judgment to the Resort. We affirm in part, reverse in
part, and remand for further proceedings.
We are presented with yet another opportunity to review,
evaluate, and interpret the bankruptcy-related documents of
the Resort and its right to collect annual assessment fees
for the maintenance of amenities. See Home & Land
Owners, Inc. v. Angel Fire Resort Operations, L.L.C.
(HALO), 2003-NMCA-070, 133 N.M. 733, 69 P.3d 243;
see also Angel Fire Resort Operations, L.L.C. v.
Corda, 2005-NMCA-084, 138 N.M. 50, 116 P.3d 841. The
dispute here is between the Resort, located in Colfax County,
New Mexico, and Plaintiff, who owns Lots 2, 3, and 4 in the
Monte Verde "V" Subdivision Unit 1 (Monte Verde
Subdivision), which is also located in Colfax County. The
Resort claims that Plaintiff is required to pay the annual
assessment fees. Plaintiff claims that he is not obligated to
pay the assessment fees.
In 1966 the LeBus family owned four ski lifts located at the
Angel Fire ski resort at the south end of the Moreno Valley
outside of Eagle Nest, New Mexico. See Riblet Tramway Co.
v. Monte Verde Corp., 453 F.2d 313, 314-15 (10th Cir.
1972). In addition, Roy LeBus (LeBus) purchased Monte Verde
Ranch and was developing the Resort with a plan to include
ski areas, a golf course, and other amenities. LeBus was the
original developer of the Resort. In 1966 and 1967 Monte
Verde Subdivision was platted and dedicated by Roy H. LeBus
& Sons, Inc. In 1967 Plaintiff purchased Monte Verde
Subdivision Lot 3 from Monte Verde Corporation. The deed to
Lot 3 was signed by LeBus and stated that the property was
"[s]ubject to easements and restrictions of
The ownership of the assets of the Resort changed over the
years. In 1993 the five corporations or partnerships
operating or related to the Resort filed for Chapter 11
bankruptcy. A Property Owners' Committee (POC) was
appointed and participated in the bankruptcy case on behalf
of the property owners in the Resort. In a disclosure
statement filed during the bankruptcy proceedings, the POC
sought to retain the rights of property owners to use the
Resort's amenities. The POC made a request for a negative
easement running with the land in order to preserve those
The bankruptcy proceedings resulted in a reorganization plan
(Plan) containing provisions regarding annual assessment fees
to be paid by property owners for use of the Resort's
amenities as well as a Supplemental Declaration providing
that the assessment fees may be changed over time for new
homesites and for existing homesites sold or transferred
after September 1996. See HALO, 2003-NMCA-070,
¶¶ 4-5. The Plan was confirmed on May 31, 1995. The
negative easement was included in the Supplemental
Declaration and was recorded on September 27, 1995. "The
Plan was accepted by a majority of all classes of claimants
required to vote on it, including the property owners."
Id. ¶ 3. The Plan and the Supplemental
Declaration required that the property owner of each homesite
pay an annual assessment fee "for the improvement,
maintenance, upkeep, repair and operation of and additions to
the [a]menities, " with payment not being dependent on
the owner's use of the amenities. Many years after the
Plan was confirmed and the Supplemental Declaration was
recorded, Plaintiff purchased Monte Verde Subdivision Lots 2
and 4. Lots 2 and 4, like Lot 3, were originally purchased
from Monte Verde Corporation.
Plaintiff argues that he never agreed that he was subject to
the annual assessments and that he has consistently
maintained that he does not use and has never used the
amenities. Plaintiff initially attempted to reopen the
bankruptcy proceedings to obtain a legal ruling concerning
this obligation to pay yearly assessments; however, his
attempts were unsuccessful because the bankruptcy estate was
closed and the court ruled it had no jurisdiction to revisit
the Plan. Plaintiff was directed to state court for any
possible relief. See In re Angel Fire Corp., No.
93-12176-3a11, 2013 WL 1856350 (D.N.M. May 2, 2013).
Plaintiff subsequently filed a complaint for declaratory
judgment and quiet title asking the district court to find
that he and his lots are not liable for membership in the
Resort and to quiet title to his property against claims made
by the Resort. The Resort filed a counterclaim for money due
based on past due assessments connected to Plaintiff's
lots. The parties filed cross-motions for summary judgment.
On January 16, 2015, the district court denied the
Resort's motions for summary judgment as to Lots 2, 3,
and 4. On April 2, 2015, the district court granted
Plaintiff's motion for summary judgment on all three
lots, finding that the exhibits and evidence show that Monte
Verde Subdivision "is not part of any of [the
Resort's] subdivisions, developments, properties, or
ownership interests." Accordingly, the district court
found that Plaintiff's lots are not subject to membership
fees, and any person to whom Plaintiff conveys or devises his
lots will not be subject to membership fees. In a letter
decision filed on February 24, 2015, the district court
indicated that it had re-examined the pleadings and exhibits
and came to the conclusion that Monte Verde Subdivision,
which includes ...