Contract & Business Disputes

Common questions

I'm owed money. Is it worth suing?

Attorneys use the term judgment proof to describe a person or company from whom a judgment would be difficult, if not impossible, to collect. The pattern is familiar. An individual forms a company, but no bank account is ever opened, no meeting held, no money invested; the name exists solely so that its owner is not held liable under the contract. When something goes wrong, that company quietly stops operating, and a new LLC appears and begins issuing contracts in its place. Or the debtor is an individual whose income is too small or too irregular to garnish, and who owns no real property against which a judgment lien could attach. A judgment against a judgment-proof debtor is worth the paper it is written on. Before suing under a contract, consider whether the counterparty could satisfy the judgment at all — and where assets have been moved rather than spent, whether the Colorado Voidable Transactions Act supplies the remedy. (Question 3.) The other considerations that determine whether suit is worthwhile — chiefly what you can prove, and how expenses can be kept down — are fact dependent. On expense, Colorado’s courts are structured to keep costs proportionate to the amount in dispute. Claims of $7,500 or less may be brought in the small claims division of county court, C.R.S. § 13-6-403, where a plaintiff may not appear through an attorney unless the defendant does, C.R.S. § 13-6-407. That alone keeps costs down substantially. Claims of $25,000 or less may be brought in county court, which carries none of the extensive motions practice or discovery expense of district court. And even in district court, an action in which no party seeks more than $100,000 proceeds under a simplified procedure that limits discovery and its attendant cost. C.R.C.P. 16.1. Bring the contract and the number. The review is complimentary.

The other side breached. What are my options short of suing?

With a demand letter, in most instances. A properly drafted demand communicates two things: that the relief sought is specific, and that counsel has been retained to obtain it. Both tend to concentrate the attention of the recipient. Where the recipient engages counsel of their own, that attorney will advise them of what they may already suspect, which is that resolution costs materially less than litigation and that the dispute is not likely to be resolved in their favor. Many attorneys will draft a demand letter. Fewer are prepared to file suit on every demand that goes unanswered. We do not issue a demand without the client’s settled intention to enforce it, which is why our demand letters are taken seriously. Where they are not, the litigation follows.

I have a judgment and the debtor moved everything into someone else’s name.

Colorado’s fraudulent transfer statute — enacted in 1991 as the Colorado Uniform Fraudulent Transfer Act and, since Senate Bill 25-133 took effect in 2025, renamed and updated as the Colorado Voidable Transactions Act — provides that a transfer made to hinder, delay, or defraud a creditor may be avoided. The statute reaches conveyances from an entity to an owner’s spouse, from an individual to family members, and transfers made for less than reasonably equivalent value while the transferor was insolvent or was rendered so by the transfer. The 2025 amendments matter in practice. Among other changes, the limitation period for insider-preference claims — the transfer by an insolvent debtor to a relative or other insider on account of an antecedent debt — was extended from one year to four years, and the amendments codify the allocation and standard of proof for claims and defenses under the act. Relief may be pursued against the property itself, against the transferee, and against the transferor. Post-judgment enforcement of this kind is frequently the difference between holding a judgment and realizing on one.

Can I recover my attorney’s fees if I win?

Colorado follows the American Rule: absent a contractual or statutory basis, each party bears its own attorney fees. The most common contractual basis is a prevailing party provision. Its operation is symmetrical, and that symmetry warrants consideration before suit is filed. Where liability is genuinely contested, each party carries the risk of a judgment and a fee award besides, which ordinarily counsels settlement. Where liability is clear, the same provision operates as leverage, and the prospect of accruing fees frequently produces an early resolution. A few Colorado and federal statutes shift fees independently of the agreement. Whether one applies is among the first questions we consider.

My business partner is freezing me out.

The governing instrument is the starting point. Whatever rights you hold as a member, partner, or shareholder are defined first by the operating agreement, the partnership agreement, or the bylaws, and a substantial proportion of these disputes are resolved by reading them closely. Owners of closely held entities owe one another duties, and the conduct that brings principals to this firm follows recognizable patterns: exclusion from decisions in which the instrument confers a voice, suspension of distributions while the controlling owner’s compensation increases, and refusal to produce books and records to which a member is entitled under the governing instrument and the inspection provisions of the Colorado corporation and limited liability company acts. A written demand for books and records is ordinarily the appropriate first step. It is inexpensive, and the response is informative whether or not it is complied with. Once trust is broken, most disputes are resolved through a negotiated exit on defined terms. Where negotiation fails, the remedies to be considered may include a claim for breach of fiduciary duty, a derivative action, or a petition for judicial dissolution. If the arrangement was never reduced to writing, disclose that at the outset. It alters the analysis without foreclosing it.

Have a different question? Our attorneys have answered dozens more in Resources.