Court of Appeals of Indiana | Opinion 23A-CT-2529 | August 26, 2024 Page 1 of 26

IN THE

Court of Appeals of Indiana

Jana Stacy,

Appellant/Cross-Appellee-Plaintiff

v.

ASI Select Insurance Corp., and United Dynamics, Inc.,

Appellees/Cross-Appellants-Defendants

August 26, 2024

Court of Appeals Case No.

23A-CT-2529

Appeal from the Floyd Circuit Court

The Honorable Justin B. Brown, Judge

Trial Court Cause No.

22C01-2102-CT-281

Opinion by Judge Riley

Judges Kenworthy and Felix concur.
Court of Appeals of Indiana | Opinion 23A-CT-2529 | August 26, 2024 Page 2 of 26

Riley, Judge.

STATEMENT OF THE CASE

[1] In this consolidated appeal, Appellant/Cross-Appellee – Plaintiff, Jana Stacy 

(Stacy), appeals the trial court’s summary judgment in favor of Appellee –

Defendant, ASI Select Insurance Corp. (ASI), on Stacy’s breach of contract 

claim. Additionally, on interlocutory appeal, Appellee/Cross-Appellant –

Defendant, United Dynamics, Inc. (UDI), appeals the trial court’s denial of its 

motion for summary judgment, which concluded that there is a genuine issue of 

material fact that UDI’s work was negligently completed. 

[2] We affirm in part and reverse in part.

ISSUES

[3] In her appeal against ASI, Stacy presents this court with two issues, one of 

which we find dispositive and which we restate as follows: 

Whether a genuine issue of material fact exists as to whether 

Stacy failed to timely notify ASI of the damage resulting from 

UDI’s work; and 

[4] In its interlocutory appeal, UDI presents this court with four issues, one of 

which we find dispositive and restate as: 

Whether the trial court erred, as a matter of law, by concluding 

that the relationship between UDI and Stacy should have been 

governed by the Indiana Home Improvement Contract Act 

(HICA) and not by the foreseeability doctrine as clarified by our 
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Indiana Supreme Court’s holding in U.S. Automatic Sprinkler

Corporation v. Erie Insurance Exchange, 204 N.E.3d 215 (Ind. 2023). 

FACTS AND PROCEDURAL HISTORY

[5] In March 2019, Stacy purchased a home located at 2412 Stover Drive, New 

Albany, Indiana. Shortly after moving into the residence, Stacy noticed 

drainage issues in the bathtub, with water draining from the bathtub flowing

back into the residence. Stacy hired Greenwell Plumbing, Inc. (Greenwell) to 

address the issue. After running a camera down the drain, Greenwell 

discovered that a collapsed sewer line was the cause of the backup. Greenwell 

informed Stacy of the collapse and Stacy retained Greenwell to repair the 

collapsed line.

[6] On May 15, 2019, two Greenwell employees arrived at the residence with a 

backhoe to assist in the repair of the damaged sewer line. They located the 

collapsed portion of the sewer line with a camera, dug to the top of the line with 

the backhoe, and then dug the remainder of the dirt by hand. Meanwhile Stacy 

was in the basement of the residence unpacking boxes when she heard two 

“booms,” which she attributed to Greenwell’s backhoe hitting the residence. 

(Appellant’s App. Vol. II, p. 190). However, both employees later informed 

Jason Thompson (Thompson), Greenwell’s general manager of services, that 

the backhoe never struck the residence. 

[7] “Six weeks” after Greenwell completed its repair work at the residence, Stacy 

noticed a crack in the residence’s exterior brick work and the foundation 
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moving inwards. (Appellant’s App. Vol. II, p. 190). She contacted Thompson 

and claimed the crack resulted from Greenwell’s employees hitting the 

residence with the backhoe. In September 2019, Thompson visited the 

residence to survey the alleged damage. Despite acknowledging that he did not 

notice any indication that the damage had been caused by a backhoe, as a 

gesture of goodwill, Thompson offered to retain UDI to repair the damage to 

the exterior and the foundation of the residence. In exchange for Greenwell 

retaining UDI to repair the damage for an amount of $4,800, Stacy executed a 

Standard General Release (Release) in which she released any current or future 

claim against Greenwell for its work at the residence in exchange for Greenwell 

paying UDI to repair the damage caused on May 15, 2019. Contained within 

this Release was the following provision: 

The Customer [Stacy] agrees to release, hold harmless and 

indemnify the Company [Greenwell] and its affiliates and each of 

its respective agents, attorneys, employees, directors and officers 

and the successors, assigns, heirs, executors, administrators and

legal representative of each of the foregoing from and against any 

and all liabilities, action, causes of action, claims, rights 

obligations charges, damages, costs, attorney’s fees, suits, and 

demands of any and every kind, nature and character, whether 

known or unknown, fixed or contingent, now existing or later 

developing that arise out of or relate to the actions or inactions of 

the Company. 

(Appellant’s App. Vol. III, p. 158). 

[8] During its repair work on Stacy’s residence, UDI installed four steel piers to 

stabilize the home. Stacy claimed UDI incorrectly performed the piering work
Court of Appeals of Indiana | Opinion 23A-CT-2529 | August 26, 2024 Page 5 of 26

and as a result damaged the drywall in the basement, the foundation of the west 

wall, the exterior bricks, and caused ceiling cracks. UDI completed its work at 

the residence on October 2, 2019. That same day, Stacy informed ASI, her 

homeowner’s insurance company, of the damage to her home. After receiving 

notification of the claim, ASI retained Tim Lee (Lee), a structural engineer with 

U.S. Forensics, to assess the damage to the residence. After inspection, Lee 

concluded that “the sewer construction work resulted in mortar joint cracks and 

separations in the concrete masonry unit foundation, additional separation in 

the west concrete foundation wall, cracks and displacements in the mortar 

joints of the brick veneer, and cracks in the interior walls and ceilings 

coverings.” (Appellant’s App. Vol. III, p. 192). He also found that “the cracks 

in the walls and ceiling of the building were recent and were the result of repairs 

to the CMU crawlspace foundation along the south side of the building.” 

(Appellant’s App. Vol. III, p. 192). Based on these conclusions, Lee further 

clarified that the “damage caused by the excavation work was not the result of 

an impact by” the backhoe. (Appellant’s App. Vol. III, p. 193). 

[9] On March 16, 2020, ASI denied Stacy’s claim after finding that the cracks in 

the walls and ceilings were due to repair work to the foundation and that faulty, 

inadequate, or defective workmanship was not covered under the Policy. ASI 

also specifically noted that “separation in the west concrete foundation wall, 

cracks and displacements in the mortar joints of the brick veneer, and cracks in 

the interior walls and ceiling coverings and cracks in the walls and ceilings were 

caused by the repair to the CMU foundation performed by [UDI] following the 
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sewer excavation.” (Appellant’s App. Vol. IV, p. 56). In its letter, ASI reserved 

the right to deny coverage on other grounds that may arise. 

[10] On February 26, 2021, Stacy filed a Complaint, alleging claims of negligent 

workmanship against Greenwell and UDI, claims for breach of contract against 

ASI and Greenwell, and a vicarious liability claim against Greenwell. In 

August 2021, based on the terms of the Release, Stacy dismissed her claims 

against Greenwell. ASI’s Response to Stacy’s Complaint asserted in its 

Affirmative Defenses, among others, that Stacy had failed to provide timely 

notice of her claim and that her claim was excluded under the Policy to the 

extent that the claim was the result of faulty, inadequate or defective design, 

specifications, or workmanship. During discovery, Stacy answered ASI’s 

interrogatories by repeatedly asserting that “[UDI] was hired by Greenwell to 

repair the damage, and they made it worse.” (Appellant’s App. Vol. III, p. 161, 

see also in similar wording at pp. 164-65, 166). 

[11] On April 7, 2023, ASI moved for summary judgment, filing a memorandum in 

support and designation of evidence and contending that Stacy’s late notice and 

her release of Greenwell from liability before giving notice of the claim to ASI 

were material breaches of the Policy such that ASI did not have a duty to 

provide coverage for the damages under the Policy’s provisions. Alternatively, 

ASI asserted that even if there was an issue of material fact as to Stacy’s breach 

of the Policy, Stacy’s own pleadings against Greenwell and UDI with claims of 

negligent workmanship against both contractors amounted to an admission that 

the Policy did not provide coverage. Later that same month, on April 28, 2023, 
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UDI filed its motion for summary judgment, together with a memorandum in 

support and designation of evidence. In its memorandum, UDI advanced four 

grounds to grant its motion. First, UDI alleged that it did not owe a duty 

because Stacy was not in privity of contract with UDI and only property 

damage had been alleged. Second, UDI contended that the economic loss 

doctrine precluded Stacy from recovering under a tort theory. Third, in the 

event UDI owed Stacy a duty, UDI did not commit a breach of that duty 

because it performed the work correctly. Lastly, Greenwell had released UDI 

from liability for the damages now claimed by Stacy. On August 1, 2023, Stacy 

filed her responses in opposition to both ASI’s and UDI’s motions for summary 

judgment. 

[12] On September 28, 2023, the trial court issued its Order granting summary 

judgment to ASI, while denying UDI’s motion for summary judgment. In its 

Order, the trial court concluded that there was no genuine issue of material fact 

that Stacy had released Greenwell from liability prior to reporting her claim to 

ASI thereby destroying ASI’s subrogation rights and that Stacy had failed to 

provide ASI with timely notice of her claim. In denying UDI’s motion, the trial 

court noted that a genuine issue of material fact remained as to whether UDI’s 

work was negligently performed. On October 10, 2023, the trial court entered 

final judgment in ASI’s favor pursuant to Indiana Trial Rule 54(B). 

[13] On October 17, 2023, UDI filed its motion to correct error, motion for 

certification of order, and motion to enlarge expert disclosure deadline. After a 
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hearing1

, the trial court denied the motion to correct error. Reaffirming its 

previous holding on UDI’s negligent workmanship, the trial court addressed 

UDI’s other three arguments in detail. The court first concluded that because 

Stacy was not a party to the contract between UDI and Greenwell, the court 

declined to find that Stacy was bound by the exculpatory clause of the UDIGreenwell contract. Second, because Stacy not only characterized her claim as 

negligent workmanship, but at “oral arguments, Stacy’s counsel articulated that 

it was a claim for breach of contract,” UDI’s argument that Stacy’s claim is 

precluded by the economic loss doctrine failed. (UDI’s App. Vol. II, p. 25). 

Third, the trial court found that because UDI failed to contract with Stacy as 

mandated under the HICA which requires a real property improvement 

supplier to provide a contract to the consumer prior to commencing the work, 

UDI could not circumvent this requirement by contracting with Greenwell and 

not Stacy. Even though the trial court denied UDI’s motion to correct error, it 

granted certification of its September 28, 2023 Order for interlocutory appeal.

[14] On January 11, 2024, UDI filed its motion for interlocutory appeal, which this 

court granted on February 14, 2024. That same day, we consolidated Stacy’s 

already pending appeal against ASI with UDI’s interlocutory appeal.

[15] Additional facts will be provided if necessary.

1 The parties did not provide this court with a transcript of the summary judgment hearing or the hearing on 

UDI’s motion to correct error.
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DISCUSSION AND DECISION

I. Standard of Review

[16] Stacy challenges the trial court’s grant of summary judgment to ASI, while UDI 

disputes the trial court’s denial of its motion for summary judgment. “The 

purpose of summary judgment is to terminate litigation about which there can 

be no factual dispute and which can be determined as a matter of law.” Lamb v. 

Mid Ind. Serv. Co., 19 N.E.3d 792, 793 (Ind. Ct. App. 2014). “The party moving 

for summary judgment has the burden of making a prima facie showing that 

there is no genuine issue of material fact and that it is entitled to judgment as a 

matter of law.” Mint Mgmt., LLC v. City of Richmond, 69 N.E.3d 561, 564 (Ind. 

Ct. App. 2017); Ind. Trial Rule 56(C). Summary judgment is a “high bar” for 

the moving party to clear in Indiana. Hughley v. State, 15 N.E.3d 1000, 1004 

(Ind. 2014). If “the moving party satisfies this burden through evidence 

designated to the trial court, the non-moving party may not rest on its 

pleadings, but must designate specific facts demonstrating the existence of a 

genuine issue for trial.” Biedron v. Anonymous Physician 1, 106 N.E.3d 1079, 

1089 (Ind. Ct. App. 2018) (quoting Broadbent v. Fifth Third Bank, 59 N.E.3d 305, 

311 (Ind. Ct. App. 2016), trans. denied), trans. denied. “A fact is material if its 

resolution would affect the outcome of the case, and an issue is genuine if a trier 

of fact is required to resolve the parties’ differing accounts of the truth, or if the 

undisputed material facts support conflicting reasonable inferences.” Williams

v. Tharp, 914 N.E.2d 756, 761 (Ind. 2009) (citation and quotation marks 

omitted).
Court of Appeals of Indiana | Opinion 23A-CT-2529 | August 26, 2024 Page 10 of 26

[17] We review a court’s ruling on a summary judgment motion de novo, applying 

the same standard as the trial court. Hughley, 15 N.E.3d at 1003. “In 

conducting our review, we consider only those matters that were designated to 

the trial court during the summary judgment stage.” Lowrey v. SCI Funeral 

Servs., Inc., 163 N.E.3d 857, 860 (Ind. Ct. App. 2021), trans. denied. “In 

determining whether issues of material fact exist, we neither reweigh evidence 

nor judge witness credibility [but] accept as true those facts established by the 

designated evidence favoring the non-moving party.” Id. (citations omitted). 

“Any doubts as to any facts or inferences to be drawn from those facts must be 

resolved in favor of the nonmoving party.” Denson v. Est. of Dillard, 116 N.E.3d 

535, 539 (Ind. Ct. App. 2018). However, “[m]ere speculation is insufficient to 

create a genuine issue of material fact to defeat summary judgment.” Biedron, 

106 N.E.3d at 1089. In the summary judgment context, we are not bound by 

the trial court’s findings of fact and conclusions thereon, but they aid our review 

by providing the reasons for the trial court’s decision. Howard Cnty. Sheriff's 

Dep’t & Howard Cnty. 911 Commc’ns v. Duke, 172 N.E.3d 1265, 1270 (Ind. Ct. 

App. 2021), trans. denied. The party that lost in the trial court bears the burden 

of persuading us that the trial court erred. Biedron, 106 N.E.3d at 1089.

II. ASI’s Summary Judgment

[18] The trial court entered summary judgment in favor of ASI based on two prongs: 

(1) Stacy’s late notice of the potentially insured claim prejudiced ASI and (2) by 

signing the Release, Stacy destroyed ASI’s subrogation rights even before she 

notified the insurance company of the damage to the residence.
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Late Notice

[19] The duty to notify an insurance company of potential liability is a condition 

precedent to the insurer’s liability to its insured. Shelter Mut. Ins. Co. v. Barron, 

615 N.E.2d 503, 507 (Ind. Ct. App. 1993), trans. denied. As such, “[n]otice is a 

threshold requirement which must be met before an insurer is even aware that a 

controversy or matter exists which requires the cooperation of the insured.” 

Motorist Mutual Insurance Co. v. Johnson, 218 N.E.2d 712, 717 (Ind. Ct. App. 

1966). The notice requirement is “material, and of the essence of the contract.” 

London Guarantee & Accident Co. v. Siwy, 66 N.E. 481, 482 (Ind. Ct. App. 1903). 

The Indiana Supreme Court stated in Miller v. Dilts, 463 N.E.2d 257, 265 (Ind. 

1984):

The requirement of prompt notice gives the insurer an 

opportunity to make a timely and adequate investigation of all 

the circumstances surrounding the accident or loss. This 

adequate investigation is often frustrated by a delayed notice. 

Prejudice to the insurance company’s ability to prepare an 

adequate defense can therefore be presumed by an unreasonable 

delay in notifying the company about the accident or about the 

filing of the lawsuit.

“The presumption of prejudice means that if the delay in giving the required 

notice is unreasonable, the burden falls on the insured to produce evidence that 

prejudice did not actually occur in the particular situation.” Ind. Farmers Mut. 

Ins. Co. v. North Vernon Drop Forge, Inc., 917 N.E.2d 1258, 1274 (Ind. Ct. App. 

2009) (citing Erie Ins. Exch. v. Stephenson, 674 N.E.2d 607, 612 (Ind. Ct. App. 

1996)). Thus, in a summary judgment action, it is incumbent upon the alleged-
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insured to set forth “some evidence” to rebut the presumption that the insurer 

has “suffered prejudice of its right to conduct a timely and adequate 

investigation.” Erie Ins. Exch., 674 N.E.2d at 612. Once the alleged insured

does so, “the burden shifts back to the insurer to establish prejudice.” Ind. 

Farmers, 917 N.E.2d at 1274.

[20] ASI’s Policy contained a specific provision regarding Stacy’s duty to promptly 

notify the insurance company after a loss: 

SECTION I – CONDITIONS 

What Must Be Done After A Loss 

In the event of a loss to which coverage may apply, the following 

duties must be performed either by you, an “insured” seeking 

coverage, or a representative of either: 

1. Give immediate notice to us;

(Appellant’s App. Vol. III, p. 50). As the notice provision contained in the 

Policy is clear and unambiguous, Stacy’s duty to ‘immediately notify’ ASI of 

the loss is a condition precedent to ASI providing coverage under the Policy for 

the damages arising from the purported negligent work performed by Greenwell 

and UDI. Because the notice provision is a condition precedent to obtaining 

coverage under the Policy, we must determine whether Stacy satisfied its duty 

to “give immediate notice” to ASI. (Appellant’s App. Vol. III, p. 50). 
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[21] To determine whether Stacy gave immediate notice of the loss to ASI, we 

evaluate whether the notice was given within a reasonable time by considering 

the purposes for which the notice was given and the circumstances of the 

particular case. Sutton v. Littlepage, 669 N.E.2d 1019, 1023 (Ind. Ct. App. 

1996); Employers Liab. Corp. v. Light, Heat, & Power Co., 63 N.E. 54, 56 (Ind. Ct. 

App. 1902) (holding that “immediate” notice means “reasonable” notice). The 

designated evidence reflects that on May 15, 2019, Greenwell’s backhoe 

allegedly struck Stacy’s residence, resulting in damage to the foundation and a 

crack in the residence’s exterior brick work. However, Stacy did not notice the 

damage until six weeks later, around the end of June or the beginning of July. 

At that point, she contacted Thompson, who surveyed the damage in 

September 2019. After Stacy executed a Release, Greenwell contracted with 

UDI to repair the damage to the exterior and foundation of the residence. It 

was not until the day UDI finalized its repair work, on October 2, 2023, 

approximately three months after the damage of the backhoe incident was 

discovered and the damage had allegedly been rectified by UDI, that Stacy first 

contacted ASI and notified the insurance company of the loss. Although the 

temporal element of our analysis does not elevate this notice as being 

unreasonable per se, combined with the surrounding circumstances of this 

three-month time frame, we conclude that the notice was not given within a 

reasonable time. Within these three months, the damage had been assessed by 

Greenwell and a purported correction of these damages had been attempted by 

UDI. Stacy only contacted ASI of the loss after UDI had completed its 

rectification work and she became convinced that UDI had made the damage 
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worse. Under these circumstances, we conclude that Stacy failed to give 

reasonable notice to ASI. See Miller, 463 N.E.2d at 266 (court ordered summary 

judgment to be entered in favor of the three insurance companies which 

received notice of the accidents giving rise to liability one month, six months, 

and seven months after their occurrence and which received notice of the 

resulting lawsuits as early as five days after the suits were filed); See Askren Hub 

States Pest Control Servs, Inc. v. Zurich Ins. Co., 721 N.E.2d 270, 278 (Ind. Ct. App. 

1999) (“We believe that Askren’s delay of six months before notifying Zurich of 

the ‘occurrence’ constitutes unreasonable notice.”).

[22] Even though Stacy did not give ASI reasonable notice of the loss, that failure 

alone will not bar recovery under the Policy unless ASI suffered prejudice as a 

result of the delay. See Miller, 463 N.E.2d at 265-66; see also Shelter, 615 N.E.2d 

at 507. Although ASI must show actual prejudice from Stacy’s unreasonable 

delay in providing notice about the loss, prejudice to ASI’s ability to prepare an 

adequate defense can be presumed where, as here, there was an unreasonable 

delay in notification. See Miller, 463 N.E.2d at 265. The presumption of 

prejudice essentially means that if the delay in giving the required notice is 

unreasonable, the injured party or the insured has the burden to produce 

evidence that no actual prejudice occurred in the particular situation. See id. In 

order to rebut this presumption that ASI could conduct nothing more than a 

cursory investigation, Stacy points to her own designated statements, 

deposition, and photographs of “the work done by Greenwell and [UDI].” 

(Stacy’s Reply Br. p. 18). She also contends that other witnesses were available 
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for depositions, and she alerts us to the report submitted by U.S. Forensics, the 

expert retained by ASI to assess the damage. 

[23] We conclude that Stacy failed to rebut the presumption of prejudice resulting 

from her unreasonable delay. Stacy’s designated evidence does not address 

ASI’s inability to view the temporary aspects of the original loss and the extent 

to which each contractor contributed to the damage. At the time notice was 

given, ASI was unable to evaluate the loss as UDI had already completely 

altered the original damage, thereby preventing ASI from assessing the original 

defects. “[T]imely notice gives the insurer an opportunity to investigate while 

evidence is fresh, evaluate the claim, and participate in early settlement.” TriEtch, Inc. v. Cincinnati Ins. Co., 909 N.E.2d 997, 1005 (Ind. 2009). Because ASI 

was prevented from meaningfully investigating the claim due to the 

unreasonably late notice, Stacy failed in rebutting the presumption of prejudice 

in favor of ASI. 

[24] In an effort to salvage part of her claim against ASI, Stacy requests this court to 

characterize her loss as two separate damage events. In a single sentence in her 

appellate brief and expounded on in her reply brief, Stacy now advances the 

theory that “[t]he separate damage by [UDI] would qualify as a new/separate 

occurrence under the Policy,” and as such, her notice of this loss would have 

been reasonable as it was provided on the same day as UDI completed its 
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work.2

 (Stacy’s Br. p. 16). However, throughout these proceedings, Stacy has 

consistently maintained that Greenwell’s actions were the “efficient proximate 

cause”3 of the damage. (Appellant’s App. Vol. III, p. 166). She also 

acknowledged numerous times that “[UDI] was hired by Greenwell to repair 

the damage, and they made it worse.” (Appellant’s App. Vol. III, p. 161, see 

also in similar wording at pp. 164-65, 166). Accordingly, without Greenwell’s 

initial damage to the foundation and the exterior wall, there was no reason for 

UDI to enter the fray and correct the loss caused by Greenwell. Without 

having to decide as to whether the loss consisted of one or two occurrences, 

Stacy only notified ASI on the day UDI completed its purported corrective 

work of Greenwell’s instigated damages. This delay prevented ASI from 

determining the exact and specific cause of the damage and the extent to which 

each contractor contributed to the loss. In other words, Stacy’s delay in 

notifying ASI resulted in ASI having to evaluate stale evidence. See Tri-Etch, 

Inc., 909 N.E.2d at 1005 (“[T]imely notice gives the insurer an opportunity to 

investigate while evidence is fresh[.]”).

2 While ASI claims that the argument of two occurrences was first made by Stacy on appeal, we disagree as 

Stacy raised this as an alternative argument in her Response in Opposition to ASI’s motion for summary 

judgment. See Appellant’s App. Vol. IV, p. 201. 

3 The efficient proximate cause rule states that where a peril specifically insured against sets other causes into 

motion which, in an unbroken sequence, produce the result for which recovery is sought, the loss is covered, 

even though other events within the chain of causation are excluded from coverage. “Stated in another 

fashion, where an insured risk itself sets into operation a chain of causation in which the last step may have 

been an excepted risk, the excepted risk will not defeat recovery.” Hartford Cas. Ins. Co. v. Evansville

Vanderburgh Public Library, 860 N.E.2d 636, 646 (Ind. Ct. App. 2007).
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[25] Because there is no genuine issue of material fact that Stacy’s notice of the loss 

to ASI was unreasonably late, we affirm the trial court’s entry of summary 

judgment in favor of ASI on Stacy’s breach of contract claim.

4

 

III. UDI’s Denial of Summary Judgment

[26] In its interlocutory appeal, UDI contends that the trial court erred as a matter of 

law in concluding that the HICA should govern the relationship between Stacy 

and UDI instead of the foreseeability doctrine, as clarified by our Indiana 

Supreme Court’s holding in U.S. Automatic Sprinkler Corporation v. Erie Insurance 

Exchange, 204 N.E.3d 215 (Ind. 2023). 

[27] Under long-standing Indiana law, a defendant is liable to a plaintiff for the tort 

of negligence if (1) the defendant has a duty to conform its conduct to a 

standard of care arising from its relationship with the plaintiff, (2) the defendant 

failed to conform its conduct to that standard of care, and (3) an injury to the 

plaintiff was proximately caused by the breach. Indianapolis-Marion Cnty. Pub.

Library v. Charlier Clark & Linard, P.C., 929 N.E.2d 722, 726 (Ind. 2010). 

Construction negligence cases can generally be divided into two categories: 

“cases where the plaintiffs seeking to recover in tort were in privity of contract 

with the defendants and cases where they were not.” Id. at 734. It is 

uncontested that Stacy and UDI were not in privity of contract; rather 

4 Because we affirm the trial court’s entry of summary judgment in favor of ASI based on Stacy’s untimely 

notice of the loss, we do not analyze Stacy’s claim that the execution of the Release only impacted ASI’s 

subrogation rights against Greenwell and not against UDI.
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Greenwell contracted with UDI, with Stacy’s approval, to correct the perceived 

damage caused to the residence by Greenwell. There is also no dispute that 

Stacy only alleged property damage and did not complain of having been 

personally injured. 

[28] In U.S. Automatic Sprinkler Corporation v. Erie Insurance Exchange, 204 N.E.3d 215 

(Ind. 2013), our supreme court recently considered whether a duty was owed 

when, like here, there was no privity of contract between the parties. The 

supreme court observed that traditionally the acceptance rule, with its various 

exceptions, “generally shielded” contractors “from third-party liability once the 

work is completed and then accepted by the owner.” Id. at 225. In other 

words, “‘contractors do not owe a duty of care to third parties after the owner 

has accepted the work.”’ Peters v. Forster, 804 N.E.2d 736, 738 (Ind. 2004)

(quoting Blake v. Calumet Constr. Corp., 674 N.E.2d 167, 170 (Ind. 1996)). 

However, the Automatic Sprinkler Court noted that in Peters it had abandoned 

the acceptance rule in favor of the “foreseeability doctrine.” Automatic Sprinkler, 

204 N.E.3d at 225. Specifically, in Peters, our supreme court held that,

A rule that provides that a builder or contractor is liable for injury 

or damage to a third person as a result of the condition of the 

work, even after completion of the work and acceptance by the 

owner, where it was reasonably foreseeable that a third party 

would be injured by such work due to the contractor’s 

negligence, is consistent with traditional principles of negligence 

upon which Indiana’s scheme of negligence law is based.
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Peters, 804 N.E.2d at 742. Continuing on the framework established in Peters, 

the Supreme Court, in Automatic Sprinkler, “clarif[ied] the foreseeability 

doctrine’s scope in two ways.” Automatic Sprinkler, 204 N.E.3d at 226. “First, 

the foreseeability doctrine applies when a third party seeks recovery for personal 

injury that was a foreseeable consequence of a contractor’s allegedly negligent 

work.” Id. This harmonized the Peters decision’s goal of “equaliz[ing] the 

liability field in the context of negligence claims resulting in injuries to third 

parties.” Id. “Second, the doctrine applies when a third party seeks recovery 

for property damage if personal injury—though not sustained—is a foreseeable 

consequence of a contractor’s allegedly negligent work.” Id. This harmonized 

the Citizen's Gas & Coke Util. v. Amer. Econ. Ins., 486 N.E.2d 998, 1000 (Ind. 

1985) decision’s goal of maintaining the privity requirement’s operation to 

preclude recovery for property damages in a negligence action, where the 

negligent work poses a risk only to property and not persons. Automatic 

Sprinkler, 204 N.E.3d at 226-27. However, when the contractor’s work 

“possesses a risk to only property—not persons—the privity requirement 

remains operative and precludes recovery for property damages in a negligence 

case.” Id. at 227. In other words, the Court in Automatic Sprinkler granted two 

avenues for third parties to recover against contractors: (1) seek recovery for a 

personal injury caused by the contractor’s allegedly negligent work if the injury 

was a foreseeable consequence of the allegedly negligent work, or (2) pursue a 

claim for property damages against the contractor if personal injury was a 

foreseeable consequence of the contractor’s allegedly negligent work. 

Therefore, for a third party to recover for property damage under the 
Court of Appeals of Indiana | Opinion 23A-CT-2529 | August 26, 2024 Page 20 of 26

foreseeability doctrine, “it must be ‘reasonably foreseeable’ that a third party 

would be injured by such work.” Id. at 226 (quoting Peters, 804 N.E.2d at 742).

[29] Accordingly, in order for Stacy to recover for the damage to her residence in the 

absence of any contractual or privity relationship with UDI, she must establish 

that it was reasonably foreseeable Stacy would be injured by UDI’s perceived 

defective work. In Automatic Sprinkler, our Supreme Court did not elaborate on 

what constituted a ‘reasonably foreseeable’ personal injury. Since Automatic

Sprinkler was decided, Indiana courts have applied this new foreseeability 

doctrine in two cases. In BMI Properties, LLC v. Daewong, LLC, 224 N.E.3d 

1000,1005 (Ind. Ct. App. 2023), the subsequent owner of a mixed-use building 

filed a complaint against the builder of the property, alleging that a bedpost fell 

through the floor when a tenant was moving in, that bricks fell off the exterior 

of the building and damaged a nearby car, that the brick veneer of the building 

was peeling away allegedly due to design defects and improper drainage leading 

to bricks falling to the ground, and that there were visible mold spores which 

posed a health risk. Applying Automatic Sprinkler’s clarification of the 

foreseeability rule, the BMI court concluded that even though no one became

injured when the bedpost broke through the floorboard, no one became ill due 

to exposure to the airborne spores and/or black mold, and no passersby were 

injured when the brick veneer peeled away from the building, whether personal 

injury was a foreseeable consequence of these events amounted to a genuine 

issue of material fact. Id. In Elpers Bros. Construction & Suppel, Inc. v. Smith, 230 

N.E.3d 920, 931 (Ind. Ct. App. 2024), this court evaluated whether a duty was 
Court of Appeals of Indiana | Opinion 23A-CT-2529 | August 26, 2024 Page 21 of 26

owed by a development company to a homeowner, when the parties were not 

in privity of contract and where the homeowner had suffered only property 

damage. Upon analysis, we found that it was undisputed that the development 

company’s alleged negligence—its construction of other residences in the 

subdivision contributed to the erosion and sediment buildup in the nearby lake, 

which resulted in the homeowner’s malfunctioning geothermal heating and 

cooling system—did not pose a reasonably foreseeable risk of personal injury to 

the homeowner. Id. In light of these circumstances, we concluded that the 

privity requirement set forth in Citizens Gas and Automatic Sprinkler controlled, 

and the homeowner was therefore precluded from recovering property damages 

from the development company. Id. 

[30] Turning now to the case at hand, we observe that due to the lack of privity 

between Stacy and UDI, in order to recover for the perceived property damage

Stacy must establish that “personal injury—though not sustained—[was] a 

foreseeable consequence of” UDI’s alleged negligent work. Automatic Sprinkler, 

204 N.E.3d at 226. The evidence reflects that six weeks after Greenwell 

completed its repair work at the residence, Stacy noticed a crack in the 

residence’s exterior brick work. Unlike in BMI, the evidence does not reflect 

the presence of any dislocated or fallen bricks. See BMI Properties, LLC, 224 

N.E.3d at 1005. Although the original damage was discovered sometime early 

July, UDI’s repairs did not commence until late September and were completed 

on October 2. There is no evidence that during this time the damage to the 

residence worsened or Stacy felt unsafe to remain in the home. Through her 
Court of Appeals of Indiana | Opinion 23A-CT-2529 | August 26, 2024 Page 22 of 26

designated evidence and in her appellate brief, Stacy now contends that she 

presented “substantial evidence demonstrating” that UDI’s work did not meet 

industry standards and “directly resulted in significant property damage.” 

(Appellant’s Reply Br. p. 14). She claimed that UDI’s negligence “violated the 

standard practices for foundation stabilization and directly led to the observed 

property damage.” (Appellant’s Reply Br. p. 14). Stacy contended that the 

piering system to rectify the foundation problem required pouring new concrete 

footers and driving steel piers into bedrock. However, Stacy did not designate 

any evidence, nor can we find any, establishing that personal injuries might 

have been a reasonably foreseeable result from UDI’s perceived negligent work. 

To the contrary, Howard Byrd (Byrd), UDI’s employee who inspected Stacy’s 

property before and after UDI performed the work, affirmed that UDI’s system 

did not require pouring new concrete footings, rather the piers installed by UDI 

“were pressed into the ground until they reached load bearing strata.” 

(Appellant’s App. Vol. IV, p. 161). Byrd also noted that, when he inspected the 

property on October 10, 2022, after UDI’s work had been completed, he did not 

see any new cracks in the mortar joints where UDI had made repairs. 

Similarly, neither Lee’s report nor Mark Ricketts,5 Stacy’s expert, found 

incorrectly installed resistance piers but rather only noted cosmetic repairs to 

the residence. At no point during these corrective repairs was Stacy ever 

advised that she needed to vacate the residence because it was unsafe. 

5 We note that Mark Ricketts’ report also depicts certain cracks in bricks and concrete that are not in the area 

of the repairs completed by UDI and therefore are not defects that UDI was employed to remedy. 
Court of Appeals of Indiana | Opinion 23A-CT-2529 | August 26, 2024 Page 23 of 26

Although Stacy points to a statement from UDI acknowledging that its work 

could physically injure Stacy or her dwelling, the statement was made as a 

caution to the homeowner “not to fall in the holes that [UDI] digs” for the 

footings, it does not amount to a recognition that personal injury was a 

reasonably foreseeable consequence of the work. (Appellant’s App. Vol. VI, p. 

121). Based on these circumstances, we do not find any genuine issues of 

material fact establishing that the alleged negligent workmanship carried with it 

a reasonable foreseeability of personal injury. See Automatic Sprinkler, 204 

N.E.3d at 226. Therefore, the privity requirement controls, and Stacy is 

precluded from recovering her property damages. See id. 

[31] Trying to avoid the application of our Supreme Court’s holding in Automatic

Sprinkler, Stacy contends that the lack of contract between herself and UDI 

constituted a violation of the HICA. Relying on Indiana Code section 24-5-11-

10, which requires that “[a] real property improvement supplier shall provide a 

completed real property improvement contract to the consumer before it is 

signed by the consumer,” Stacy argues that UDI, as a real property 

improvement supplier under I.C. § 24-5-11-6, should have contracted directly 

with her, as a consumer pursuant to I.C. § 24-5-11-2, and not with Greenwell. 

She maintains that UDI’s failure to comply with these statutory requirements 

“exposes [UDI] to liability for failing to meet statutory obligations.” (Stacy’s 

Reply Br. p. 11). 

[32] While we agree with Stacy that public policy strongly favors the enforcement of 

consumer protection statutes to ensure that homeowners are safeguarded 
Court of Appeals of Indiana | Opinion 23A-CT-2529 | August 26, 2024 Page 24 of 26

against deceptive practices and poor workmanship, Stacy’s argument in essence 

amounts to the abrogation of the well-known adage that Indiana courts 

recognize the freedom of parties to enter into contracts and presume that 

contracts represent the freely bargained agreement of the parties. Fresh Cut, Inc. 

v. Fazli, 650 N.E.2d 1126, 1129 (Ind. 1996). 

[33] The reality before us acknowledges that Greenwell and UDI contracted for the 

benefit of Stacy. The contract between Greenwell and UDI was not a “real 

property improvement contract” because it was not entered into between a 

“consumer” and a “real property improvement supplier.” I.C. § 24-5-11-4. 

Therefore, the HICA did not apply to UDI for the purpose of its transaction 

with Greenwell. Moreover, Stacy consented to Greenwell entering into an 

“agreement to allow [UDI] to fix the foundation.” (Appellant’s App. Vol. IV, 

p. 85). Stacy and Greenwell negotiated the Release, which directly contributed 

to Greenwell entering into a contract with UDI to correct Greenwell’s alleged 

damages. In the provisions of the Release, Stacy acknowledged that “[t]he 

customer accepts that by Greenwell paying [UDI] for quoted repairs due to 

damage caused during service on 05/15/2019 in the amount of $4,800.00 that 

this claim will be satisfied and closed.” (Appellant’s App. III, p. 158). Instead 

of negotiating with Greenwell to pay her a lump sum and then contracting 

directly with the provider of the repairs, Stacy voluntarily elected to permit 

Greenwell to coordinate and pay for the foundation repairs. To that end, 

Greenwell entered into a contract with UDI. It is only after the Release was 

executed and the repairs made that Stacy complained of the contractual 
Court of Appeals of Indiana | Opinion 23A-CT-2529 | August 26, 2024 Page 25 of 26

structure that she freely negotiated and agreed upon. While we agree that 

HICA’s intent is to protect consumers from substandard and deceptive practices 

in home improvement transactions, Stacy has not designated any evidence 

supporting the allegation that the agreed upon contractual framework

intentionally allowed “UDI to bypass the protections afforded by HICA” to 

Stacy. (Stacy’s Reply Br. p. 11). 

[34] Accordingly, based on the designated evidence before us, we conclude that UDI 

did not owe a duty to Stacy because the parties were not in privity of contract 

and personal injury was not reasonably foreseeable to result from the alleged 

acts of negligence. Therefore, as there are no genuine issues of material fact, 

UDI is entitled to summary judgment as a matter of law. We reverse the trial 

court’s denial of UDI’s motion for summary judgment.6

CONCLUSION

[35] Based on the foregoing, we hold that no genuine issue of material fact exists 

that Stacy failed to timely notify ASI of the damage resulting from UDI’s 

workmanship. However, because we hold that no privity of contract exists 

between Stacy and UDI and personal injury was not reasonably foreseeable to 

6 Because we find UDI’s privity of contract argument determinative of the cause before us, we will not 

address UDI’s alternative arguments with respect to the application of the economic loss doctrine and with 

respect to waiver of claims for property damage pursuant to the exculpatory clause in UDI’s contract with 

Greenwell. 
Court of Appeals of Indiana | Opinion 23A-CT-2529 | August 26, 2024 Page 26 of 26

result from the alleged acts of negligence, we reverse the trial court's denial of 

UDI’s motion for summary judgment and enter summary judgment for UDI. 

[36] Affirmed in part and reversed in part.

Kenworthy, J. and Felix, J. concur

ATTORNEY FOR APPELLANT

William D.Beyers

Buchanan & Bruggenschmidt, PC

Zionsville, Indiana

ATTORNEYS FOR APPELLEES

William J. Beggs

Ryan M. Heeb

Bunger & Robertson

Bloomington, Indiana

Eric C. McNamar

Edmund L. Abel

Lewis Wagner, LLP

Indianapolis, Indiana