Exploring the Boundaries of Vallagio

BY: Peter Schaub and Tasha Power

The Colorado Supreme Court’s decision in Vallagio at Inverness Residential Condominium Association, Inc. v. Metropolitan Homes, Inc., was deemed a victory for the development community in the context of ongoing construction defect litigation reform efforts. In sum, the court in Vallagio upheld a provision in a condominium declaration requiring that all construction defect claims be resolved through binding arbitration, and that such provision “shall not ever be amended” without the declarant’s written consent (the “Consent-to-Amend Provision).” The purpose of this article is to explore the potential reach of Vallagio to other covenant provisions.

Before addressing the potential reach of Vallagio, it is necessary to look at the underpinnings of the court’s reasoning.

First, the court addressed the argument that the consent-to-amend provision violated the Colorado Common Ownership Interest Act, C.R.S. section 38-33.3-217(1)(a)(I).

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