The Colorado Construction Trust Statute, C.R.S. ยง38-22-127 (Trust Statute) is an extremely powerful tool in construction disputes. The Trust Statute provides that a general contractor or subcontractor that has received monies for work on a construction project must use those monies on that particular project.

If the general contractor or subcontractor uses the money paid by an owner or the owner’s funding source for other projects, for the general operation and overhead of their business or on personal expenses, that business and the individual principals may be liable for treble damages, attorney fees and costs. Importantly, a debt incurred in violation of the Trust Statute is not dischargeable in bankruptcy and may constitute the crime of theft resulting in criminal penalties including jail time.

The attorneys at Inman Flynn have represented owners asserting Trust Statute claims and general contractors, subcontractors and their principals in defending against this powerful statute. If you have a construction project where the general contractor or subcontractors have not used money you paid for the project or are a general contractor or subcontractor that has been accused of violating the Trust Statute, please call the attorneys at Inman Flynn for help.