QUINN, Chief Justice.
We granted certiorari to review the decision of the court of appeals in Board of County Commissioners v. Auslaender, 710 P.2d 1180 (Colo.App.1985). In reversing the trial court's denial of Fay and Bennett Auslaender's motion for an award of
This case arises out of a long history of litigation over the use of a road segment which once was part of U.S. Highway 285, abandoned by the State Highway Commission in 1958. In January 1980 Fay Auslaender, who had acquired property adjacent to the north half of old Highway 285, obtained a quiet title decree to the north half of what had been the highway, and in October 1982 Bennett Auslaender, who owned the property adjacent to the south half, obtained a quiet title decree to the south half of old Highway 285. By letter to the county, Bennett Auslaender offered the county a 30-foot wide public easement across the property for $200 and the county's assurance that it would not condemn an additional interest in his or Fay Auslaender's portion of the old roadway. The letter further asserted that he "has every intention to totally resist any condemnation of his property by Jefferson County."
In December 1982 the county authorized an appraisal of the Auslaenders' properties, and on June 30, 1983, passed a resolution directing the county to "carry on negotiations in good faith to attempt to acquire said parcels without resort to eminent domain." The county sent letters of purchase offers, dated June 29, 1983, to each of the Auslaenders.
The Auslaenders filed a motion to dismiss on the basis that the county had the duty to engage in good faith negotiations and that its failure to do so deprived the court of jurisdiction over the condemnation action. The district court granted the Auslaenders' motion to dismiss the condemnation petition on two grounds: (1) since failure to agree upon compensation is a prerequisite to the commencement of a condemnation proceeding, see § 38-1-102, 16A C.R.S. (1982), the time between the county's mailing of the letter containing the offer to purchase the property and the filing of the petition did not allow the Auslaenders sufficient time to respond to the county's offer; and (2) that the county's resolution of August 18, 1983, did not effectively ratify the prior filing of the condemnation action.
The Auslaenders then filed a motion for an award of attorney fees pursuant to section 13-16-121, 6 C.R.S. (1983 Supp.), on the basis that the county had no reasonable basis for commencing the condemnation action.
The Auslaenders appealed the district court's order denying their motion for attorney fees. In reversing the district court's order, the court of appeals held that, while the county might be relieved of its duty to negotiate in circumstances where negotiation would be futile, the county in this case did not provide the Auslaenders with any reasonable opportunity for negotiations. Consequently, in the court of appeals' view, the county's petition in condemnation was without a reasonable basis in fact or law and, in addition, was frivolous and thus subject to an assessment of attorney fees in favor of the Auslaenders. We thereafter granted the county's petition for certiorari to consider the court of appeals' resolution of this matter.
As pertinent here, section 13-16-121, 6 C.R.S. (1983 Supp.), permits a defendant prevailing against a public entity to recover reasonable attorney fees "if the court determines that said action is without reasonable basis or is frivolous." For purposes of section 13-16-121, 6 C.R.S. (1983 Supp.), the term "without reasonable basis" is equivalent to a "groundless" claim or defense. On the basis of our decision in Western United Realty, Inc. v. Isaacs, 679 P.2d 1063 (Colo.1984), a claim or defense is groundless if the allegations of the complaint or answer, while sufficient to survive a motion to dismiss for failure to state a claim or a motion to strike for failure to state a legal defense, "are not supported by any credible evidence at trial." Id. at 1069. "This test assumes that the proponent has a valid legal theory but can offer little or nothing in the way of evidence to support the claim or defense." Id. A claim or defense is frivolous "if the proponent can present no rational argument based on the evidence or law in support of that claim or defense." Id. This standard of frivolousness is not intended to apply to unsuccessful but legitimate efforts to establish a new theory of law or good faith efforts to extend, modify, or reverse existing law. Id.
A party filing a motion for an award of attorney fees bears the burden of proving by a preponderance of evidence its entitlement to such an award. See § 13-25-127, 6 C.R.S. (1973) (burden of proof in civil action, except claim for exemplary damages or body execution, "shall be by a preponderance of the evidence"). The party against whom the motion is directed must be given appropriate notice and an opportunity to controvert the motion. See Mission Denver Co. v. Pierson, 674 P.2d 363 (Colo.1984). If the motion for attorney fees is predicated on the lack of a factual basis for an asserted claim for relief or defense, the trial court is obliged to make findings that will permit meaningful appellate review of its disposition of the motion.
Our prior cases hold that a condemning authority must engage in reasonable good faith efforts to negotiate as a jurisdictional prerequisite to the filing of a condemnation action. E.g., City of Thornton v. Farmers Reservoir, 194 Colo. 526, 575 P.2d 382 (1978); Stalford v. Board of County Comm'rs, 128 Colo. 441, 263 P.2d 436 (1953). However, we have never addressed whether the condemning authority is relieved of such obligations when efforts at reasonable good faith negotiations would be futile, see State v. Hurliman, 230 Or. 98,
It is axiomatic that an appellate court "cannot substitute itself as a finder of fact." Gebhardt v. Gebhardt, 198 Colo. 28, 30, 595 P.2d 1048, 1050 (1979). It was the prerogative of the district court to determine in the first instance whether the county's condemnation action was or was not "without reasonable basis" or "frivolous" because of the county's failure to engage in reasonable negotiations with the Auslaenders. The district court, however, failed to provide both the Auslaenders and the county an evidentiary hearing on this factual question. In the absence of an adequately developed record, including findings of fact and conclusions of law on the claim for attorney fees, there is simply no basis in fact or in law to support the court of appeals' determination that the Auslaenders were entitled to attorney fees.
The judgment of the court of appeals is reversed and the case is remanded to that court with directions to return the case to the district court for further proceedings on the Auslaenders' motion for attorney fees in a manner consistent with the views herein expressed.
ERICKSON, J., dissents, and MULLARKEY, J., joins in the dissent.
ERICKSON, Justice, dissenting:
I respectfully dissent. A defendant prevailing against a public entity can recover reasonable attorney fees "if the court determines that said action was brought without reasonable basis or is frivolous." Section 13-16-121, 6 C.R.S. (1984). "A claim or defense is frivolous if the proponent can present no rational argument based on the evidence or law in support of that claim or defense." Western United Realty v. Isaacs, 679 P.2d 1063, 1069 (Colo.1984). "[I]f the record reveals that counsel or any party has brought, maintained, or defended an action in bad faith, the rationale for awarding attorney's fees is even stronger." Id.
In this case, attorney's fees should be awarded because the county initiated the condemnation proceeding without negotiating with the owners for acquisition of the property. The county's negotiation consisted of no more than the mailing of an offer and the granting of limited time after the mailing for the acceptance of the offer. Negotiation by the condemnor is a jurisdictional prerequisite to the commencement of an eminent domain proceeding. City of Thornton v. Farmers Reservoir and Irrigation Co., 194 Colo. 526, 538, 575 P.2d 382, 392 (1978); Interstate Trust Bldg. v. Denver Urban Renewal Auth., 172 Colo. 427, 433, 473 P.2d 978, 981 (1970); Vivian v. Board of Trustees of Colo. School of Mines, 152 Colo. 556, 561, 383 P.2d 801, 804
The trial court order includes the following findings:
Bennett Auslaender submitted an affidavit asserting that he received the county's offer in the mail on July 27, 1983. Fay Auslaender, by affidavit, stated that she received the offer on August 15, 1983. I agree with the trial court, the county did not satisfy the jurisdictional prerequisite of negotiation before initiating eminent domain proceedings. See Annotation, Sufficiency of Condemnor's Negotiations Required as Preliminary to Taking in Eminent Domain, 21 A.L.R. 4th 765, 822-23 (1983) (discussing cases that denied condemnation because condemnor had allowed insufficient time to consider the offer). The court of appeals decision awarding attorney's fees to the Auslaenders should be affirmed.
I am authorized to say that Justice MULLARKEY joins in this dissent.
Section 13-6-121, 6 C.R.S. (1983 Supp.), has since been repealed. Awards of attorney fees are now governed by section 13-17-101 to -106, 6 C.R.S. (1986 Supp.).
679 P.2d at 1069.