Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 1 of 15

MEMORANDUM DECISION

Pursuant to Ind. Appellate Rule 65(D), this 

Memorandum Decision shall not be regarded as 

precedent or cited before any court except for the 

purpose of establishing the defense of res judicata, 

collateral estoppel, or the law of the case.

ATTORNEY FOR APPELLANT

Theodore L. Stacy

Valparaiso, Indiana

ATTORNEY FOR APPELLEE

Rebecca H. Fischer

Laderer & Fischer, P.C.

South Bend, Indiana

I N T H E

COURT OF APPEALS OF INDIANA

Kelli Alvarez

f/k/a Kelli Galanos,

Appellant-Defendant,

v.

Horizon Bank, N.A.,

Appellee-Plaintiff.

April 6, 2015

Court of Appeals Case No.

46A03-1404-CC-129

Appeal from the Laporte Superior 

Court; The Honorable Jennifer L. 

Koethe, Judge;

46D03-1205-CC-401

May, Judge.
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 2 of 15

[1] Kelli Alvarez f/k/a Kelli Galanos (Kelli) appeals judgment in favor of Horizon 

Bank, N.A. (Horizon). She presents three issues for our review, which we 

consolidate and restate as:

[2] 1. Whether the court erred when it denied Kelli’s Motion to Dismiss based 

on Trial Rule 12(B)(1); and

[3] 2. Whether the trial court abused its discretion when it entered summary 

judgment in favor of Horizon regarding Horizon’s original claim.

Facts and Procedural History1

[4] Kelli was married to George Galanos (George). Their divorce was final on 

May 18, 2011. As part of the divorce decree, George was awarded “all rights, 

title, interest, and exclusive use and possession” of all four properties the couple 

owned during their marriage. (App. at 56.) For each property, the court 

ordered, “[George] shall be responsible for and pay the outstanding mortgage(s) 

and utilities billed to the premises.” (Id.) Kelli was ordered to “execute and 

deliver to [George] a Quit Claim Deed” to each property within thirty days of 

the divorce decree. (Id.) One of those properties, located at 1915 Redwood 

Lane (Redwood Property) in Munster, Indiana, is the subject of the instant 

matter.

 

1 We held oral argument on this case on February 27, 2015, as part of the Women’s Bench Bar Retreat at 

Culver Cove in Culver, Indiana. We thank the Women’s Bench Bar for their hospitality and counsel for their 

presentations.
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 3 of 15

[5] During the divorce proceedings, George was also in the midst of bankruptcy 

proceedings, and the divorce court order noted George testified “he was 

confident that he would be able to pay the installment debt owed against the 

four properties through his bankruptcy plan. Additionally, [George] testified 

that he would sell the properties if this was not possible for any unforseen [sic] 

reason.” (Id. at 55.) One of the creditors in the bankruptcy proceedings was 

Horizon, which held a second mortgage on the Redwood Property. Horizon’s 

mortgage was created to secure a $150,000 promissory note. 

[6] On May 7, 2012, the bankruptcy court issued an “Agreed Order for Relief of 

Status as Co-Debtor” which stated:

1. On January 19, 2010, [George] filed a Bankruptcy Petition 

under Chapter 13 of the United States Bankruptcy Code.

2. The jurisdiction of this proceeding is invoked pursuant to 28 

U.S.C. § 151 and 1334. [sic]

3. On or about February 7, 2007, [Kelli] executed and delivered to 

Horizon a promissory note in the original principal amount of 

$150,000.00 (the “Note”).

4. In order to secure payment of the Note and other obligations 

contained in the Note, [Kelli] and [George] executed and delivered to 

Horizon on February 7, 2007 a second mortgage with respect to 

[Redwood Property].

5. As of September 30, 2009 the total amount owing on the Note 

was principal of $152,975.68 with interest accruing after that date at 

the rate of $38.71 per diem. The Note is in default for the June 2009 

payment and payments due thereafter.

6. Horizon wishes to file an action against [Kelli] to collect the 

Note, and has agreed to the entry of an order stripping its lien on 

[Redwood Property], in Adversary Proceeding No. 12-02008 filed by 
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 4 of 15

[George], effective upon [George’s] completion of the Chapter 13 plan 

and the entry of discharge.

(Id. at 20.) 

[7] On May 30, 2012, Horizon filed the cause against Kelli that underlies this 

appeal, a “Complaint on Promissory Note” alleging Kelli was “in default under 

the terms of the [Promissory Note] in that she has failed to make the payment 

due for June 2009 or any month after.” (Id. at 16.) Horizon noted in its 

complaint the bankruptcy court’s order allowing Horizon to file a claim against 

Kelli, and asked for a judgment against Kelli of “$190,497.52, together with 

accrued interest after May 11, 2012, plus Horizon’s cost of collection, including 

reasonable attorney fees, the costs of this action and all other just and proper 

relief in the premises.” (Id. at 17.)

[8] On August 20, 2012, Horizon filed a Motion for Summary Judgment, and the 

trial court set a hearing on the matter for October 29, 2012. On August 24, 

2012, Kelli filed a Motion to Dismiss for Lack of Subject Matter Jurisdiction. 

Horizon responded, and on November 1, 2012, the trial court denied Kelli’s

Motion to Dismiss.

[9] On December 4, Kelli filed her response to Horizon’s Motion for Summary 

Judgment and added a counterclaim alleging constructive fraud. Horizon 

moved to dismiss Kelli’s counterclaim on December 20, and on December 28, 

the trial court entered final judgment in favor of Horizon without addressing

Kelli’s counterclaim.
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 5 of 15

[10] On January 10, 2013, Kelli responded to Horizon’s motion to dismiss her 

counterclaim. On January 28, Kelli filed a motion to correct error regarding the 

trial court’s December 28 judgment. After a hearing, the trial court denied 

Kelli’s motion to correct error and decided, based on the pleadings, that 

Horizon’s motion to dismiss would be more properly considered a motion for 

summary judgment. It directed the parties to designate evidentiary materials in 

support of their arguments.

[11] Kelli appealed the denial of her motion to correct error, and we dismissed her 

appeal as untimely. See Alvarez v. Horizon Bank, N.A., 46A03-1304-CC-155 (Ind. 

Ct. App. December 11, 2013) (Alvarez’s appeal was untimely because she did 

not appeal a final judgment; Judge May’s concurrence reasoned the appeal 

should be dismissed because, while it was interlocutory in nature because it 

involved the payment of money, Alvarez did not file her appeal within thirty 

days of the summary judgment for Horizon). On January 8, 2014, the trial 

court entered summary judgment for Horizon on Kelli’s counterclaim. 

Discussion and Decision

1. Kelli’s Motion to Dismiss

[12] The standard for reviewing a ruling on a motion to dismiss for lack of subject 

matter jurisdiction depends on whether the trial court resolved disputed facts 

and, if so, whether it conducted an evidentiary hearing or ruled on a paper 

record. Johnson v. Patriotic Fireworks, Inc. 871 N.E.2d 989, 992 (Ind. Ct. App. 

1997). If the facts before the trial court are not disputed, the question of subject 
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 6 of 15

matter jurisdiction is one of law that we review de novo. Id. Likewise, if the 

facts are disputed but the trial court rules on a paper record, the standard of 

review is also de novo. Id.

[13] In her Motion to Dismiss, Kelli argued:

1. That Kelli was married to [George] during the time the alleged 

promissory note upon which [Horizon] now sues was allegedly 

executed.

2. That by its own terms, the alleged promissory note was secured 

by a mortgage lien on [Redwood Property].

3. That after making the alleged promissory note, Kelli and 

George’s marriage was dissolved pursuant to court order entered in 

cause number 46D02-0911-DR-373, on May 18, 2011, by the Special 

Judge then sitting in LaPorte Superior Court Number 2. The decree is 

attached hereto as “Defendant 1”. [sic]

4. That the dissolution decree assigned the rights and duties of the 

parties as well as divided all marital property including the rights to the 

real estate serving as security interest for the alleged promissory note; 

and, also assigned the obligations on that alleged debt upon which 

Horizon now sues.

5. That the dissolution decree ordered Kelli to assign to George all 

of her rights in the real property that is cited as security for the alleged 

promissory note (as that real property is identified within the alleged 

note, 1915 Redwood Lane) in exchange for George’s assumption of 

debt on that property and for all other consideration and obligations 

contemplated and ordered in the decree.

6. That Horizon is well aware of the dissolution of the marriage of 

Kelli and George, having litigated the issue of relief from stay with 

George regarding the alleged promissory note and its alleged security 

known as 1915 Redwood Lane in the bankruptcy court.

7. That Horizon and George entered into an agreed order 

(“agreed order”) regarding the alleged promissory note secured by 

1915 Redwood Lane as evidenced by the exhibits attached to 

Horizon’s complaint.
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 7 of 15

8. That Kelli was not a party to Horizon and George’s agreement 

or their agreed order.

9. That the agreed order entered into between George and 

Horizon in the bankruptcy court releases Horizon’s mortgage lien on 

[Redwood Property], in exchange for George consenting to Horizon’s 

pursuit of Kelli for payment of the alleged promissory note secured by 

the same real estate Kelli was ordered by the dissolution court to 

convey to George who was ordered to assume the debt thereon.

10. That the agreed order did not create in Horizon any new rights 

or remedies superior to those previously decided by the dissolution 

court, but merely released Horizon from the automatic stay against 

prosecution of its alleged interests regarding the alleged promissory 

note.

11. That the exchange of interests between George and Horizon via 

their agreed order did not modify the dissolution decree containing 

and ordering the property settlement between George and Kelli.

12. That Horizon is, however, attempting to use its agreement with 

George to work a modification of the marital dissolution order, 

specifically the former real property and the debt attaching to it, 

without Kelli’s consent; and, more importantly, without the 

knowledge or consent of the dissolution court.

13. That Horizon’s complaint in this action seeks to convert its 

agreement with George into an enforceable right of collection against 

Kelli, which is nothing more than a collateral attack on the marital 

dissolution order and its property settlement.

(App. at 41-44.) 

[14] In support of her argument for dismissal, Kelli cited Fackler v. Powell, 839 

N.E.2d 165 (Ind. 2005). In Fackler, the parties were divorced, and as part of the 

dissolution, Powell, the husband, was to assign payment of a promissory note 

and mortgage to Fackler, the wife. Fackler sued Powell, contending she was 

owed a lump sum of $103,000.00. Powell moved to dismiss the action, arguing 

the dissolution court had exclusive jurisdiction over the matter. The trial court 
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 8 of 15

disagreed, and granted summary judgment in favor of Fackler. On appeal we 

agreed the trial court had jurisdiction over the matter. 

[15] Our Indiana Supreme Court reversed, holding the property settlement was 

within the exclusive jurisdiction of the dissolution court. It noted:

In her brief and in oral argument, Fackler maintained that her claim of 

entitlement to the $103,000 was brought both against Powell and 

Powell’s “Living Trust, two separate legal entities. The Family Court 

which issued the [dissolution decree] would not have had personal 

jurisdiction or subject matter jurisdiction over the non-party to the 

divorce action, that being the Living Trust.” Appellant’s Br. in Resp. 

to Pet. to Trans. at 9. Fackler did not present any authority for this 

proposition in her brief; at oral argument, she cited Miller v. Partridge, 

734 N.E.2d 1061, 1064 (Ind. Ct. App. 2000), and Kiltz v. Kiltz, 708 

N.E.2d 600, 602 (Ind. Ct. App. 1999), transfer denied, 726 N.E.2d 302. 

These cases both address the question of whether a child designated in 

a property settlement agreement as the beneficiary of a parent’s life 

insurance policy is a third-party beneficiary of the settlement 

agreement, entitled to enforce the designation. But neither case 

involved a claim by one of the parties to the dissolution nor addressed 

the propriety of bringing such a claim in a court other than the 

dissolution court. Fackler has not persuaded us that it would have 

been improper to join the Living Trust in an enforcement action in the 

Dissolution Court or that she would not have been able otherwise to 

enforce a judgment obtained from the Dissolution Court against the 

Living Trust.

Id. at 170. 

[16] In her motion, Kelli argued, pursuant to Fackler:

14. That the court issuing Kelli and George’s dissolution decree has 

exclusive and continuing jurisdiction to interpret and adjudicate all 

property issues designated within and emanating from the dissolution 

decree. Fackler v. Powerl, [sic] 839 NE 2d 165 (S. Ct. Ind. 2005). [sic]
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 9 of 15

15. That the alleged promissory note, the real property securing it, 

and the rights and obligations between George and Kelli regarding that 

real property and its debt are issues that “emanate” from the 

dissolution decree, which allocated the rights, property, and 

obligations of the parties.

16. That this court did not issue the dissolution decree dissolving 

Kelli and George’s marriage; and, therefore lacks subject matter 

jurisdiction over Horizon’s collateral attack on the dissolution decree. 

Id.

17. That the issues alleged by Horizon, and pursuant to its deal 

with George, concern the division of marital property and the division 

of marital obligations on debt secured by that marital property. Id.

18. That Horizon’s choice of this forum to litigate the rights and 

obligations of the parties to the marital dissolution according to the 

terms of the agreement Horizon reached in its agreement with George, 

is a collateral attack upon the dissolution decree entered by the 

dissolution court, which divided the property cited as security for the 

alleged promissory note upon which Horizon now sued. Id. At [sic] 

168-169.

(App. at 44-45.)

[17] Fackler does not control, because Horizon was not a party to the dissolution 

action and Kelli was liable for the Promissory Note regardless of the dissolution 

court’s order. In Hazifotis v. Citizens Federal Savings and Loan, 505 N.E.2d 445, 

447 (Ind. Ct. App. 1986), Citizens Federal Savings and Loan sued Hazifotis for 

nonpayment of a debt he thought he had transferred to another person when 

Hazifotis sold his interest in a business to his business partner, Thureanos. We 

noted:

As part of the transaction, Hazifotis intended that Thureanos would 

assume his outstanding mortgage explaining his desire to Dominic 

Cefali, president of Gary Federal [a subsidiary of Citizens Federal 

Savings and Loan]. However, there were no further discussions 
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 10 of 15

because interest rates were too high. No paperwork was prepared to 

effect an assumption nor was Gary Federal’s permission sought. 

When Hazifotis completed the sale he knew that there had been no 

transfer of his obligation. Thureanos never assumed the mortgage. 

Only the Gary Federal Board could approve an assumption and as a 

matter of policy, such an assumption would never release the original 

obligor.

[18] Id. at 447. We held: “The conveyance by a mortgagor of the mortgaged 

premises to another does not exonerate him from personal liability for the debt 

secured.” Id.

[19] Additionally, the trial court did not err, as Horizon noted the “divorce decree 

itself acknowledges that Kelli remained liable on the Note until George 

refinanced the Note . . . Horizon never agreed to a refinancing of the Note. 

Horizon could not be ordered by the divorce court to refinance the Note.” 

(App. at 75.) Finally, the terms of the Note Kelli signed indicated:

CHOICE OF VENUE. If there is a lawsuit, I agree upon Lender’s 

request to submit to the jurisdiction of the courts of LaPorte County, 

State of Indiana.

* * * * *

GENERAL PROVISIONS..... Upon any change in the terms of this 

Note, and unless otherwise expressly stated in writing, no party who 

signs this Note, whether as a maker, guarantor, accommodation maker 

or endorser shall be released from liability. 

(Id. at 75-76.) Accordingly, the trial court did not err when it denied Kelli’s 

motion to dismiss because Horizon’s action was properly filed in the trial court, 

as Horizon was not under the jurisdiction of the dissolution court, as Kelli 

asserted.
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 11 of 15

2. Summary Judgment

[20] We review summary judgment de novo, applying the same standard as the trial 

court. Hughley v. State, 15 N.E.3d 1000, 1003 (Ind. 2014). Drawing all 

reasonable inferences in favor of the non-moving party, we will find summary 

judgment appropriate if the designated evidence shows there is no genuine issue 

as to any material fact and the moving party is entitled to judgment as a matter 

of law. Id. 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. Id. 

[21] The initial burden is on the summary-judgment movant to demonstrate there is 

no genuine issue of fact as to a determinative issue, at which point the burden 

shifts to the non-movant to come forward with evidence showing there is an 

issue for the trier of fact. Id. While the non-moving party has the burden on 

appeal of persuading us a summary judgment was erroneous, we carefully 

assess the trial court’s decision to ensure the non-movant was not improperly 

denied his day in court. Id. 

[22] Our summary judgment policies aim to protect a party’s day in court. Id. 

While federal practice permits the moving party to merely show that the party 

carrying the burden of proof lacks evidence on a necessary element, we impose a 

more onerous burden -- to affirmatively negate an opponent’s claim. Id. That 

permits summary judgment to “be precluded by as little as a non-movant’s 

‘mere designation of a self-serving affidavit.’” Id. (quoting Deuitch v. Fleming,
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 12 of 15

746 N.E.2d 993, 1000 (Ind. Ct. App. 2001), trans. denied). Summary judgment 

is not a summary trial, and it is not appropriate just because the non-movant 

appears unlikely to prevail at trial. Id. at 1003-04. We “consciously err[] on the 

side of letting marginal cases proceed to trial on the merits, rather than risk 

short-circuiting meritorious claims.” Id. at 1004. 

[23] Horizon argued in its motion for summary judgment there was no genuine 

issue of material fact and it was entitled to judgment as a matter of law. It 

designated as evidence an Affidavit in Proof of Damages, and Affidavit of NonMilitary Status, Affidavit of Attorney Fees, and Designation of Proof. After her 

Motion to Dismiss was denied, Kelli filed a response to Horizon’s motion, 

reasserting lack of jurisdiction over the matter, and arguing:

Horizon’s action against Kelli constitutes an equitable foreclosure and 

foreclosure at law of her mortgage interest in Redwood Lane without 

offering her a recourse of redemption in violation of Indiana law, and 

in violation of the mortgage foreclosure notice provisions in Indiana 

Code 32-30-10.5, and the requirement of strict foreclosure. Patterson v. 

Grace, 661 NE 2d 580, 586 (Ind. Ct. App. 1996). [sic]

[24] (App. at 107.) Kelli designated as evidence the marital dissolution order 

attached to her Motion to Dismiss and a copy of the mortgage securing the 

promissory note.

[25] The trial court granted summary judgment for Horizon, finding “no genuine 

issues as to the material facts alleged in Horizon’s Complaint and that Horizon 

is entitled to judgment as a matter of law.” (Id. at 10.) The trial court ordered 
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 13 of 15

Kelli to pay Horizon $190,644.96 “plus interest accruing after May 12, 2012.” 

(Id.)2 

[26] On appeal, Kelli argues summary judgment was improper because she 

presented genuine issues of material fact in her response to Horizon’s Motion 

for Summary Judgment. She incorporates her arguments regarding the Motion 

to Dismiss. Regarding her foreclosure argument, Kelli asserts her rights as a 

mortgagor under Ind. Code chapter 32-30-10.5 and argues Horizon did not 

properly inform her as required by Ind. Code § 32-30-10.5-8 that the debt owed 

to Horizon was in default. She asserts, “[t]he deal that Horizon brokered with 

George affects Kelli’s rights under I.C. 32-30-10.5, and Horizon offered no 

evidence that it had complied with the notice provisions of the statute.” (Br. of 

Appellant at 20.)

[27] However, Ind. Code chapter 32-30-10.5 does not apply to a promissory note, 

and the action filed against Kelli was not a foreclosure action, as evidenced by 

the cause number filed with the trial court, which “indicates that the action was 

filed as a civil collection matter (CC) and not a mortgage foreclosure (MF).” 

(Br. of Appellant at 14.)

 

2 Kelli filed a Motion to Correct Error, in which she argued the summary judgment was error because the 

order was not dispositive of all the issues before the court; it did not include judgment on Kelli’s 

counterclaim, the court’s order prejudged her counterclaim, and the court did not have jurisdiction over the 

matters before it. Kelli does not argue the trial court erred when it denied her Motion to Correct Error, and 

our standard of review for appeal of a Motion to Correct Error directs us to consider the underlying order, 

here the summary judgment for Horizon. See In re Paternity of H.H., 879 N.E.2d 1175, 1177 (Ind. Ct. App. 

2008) (review of motion to correct error includes review of underlying order).
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 14 of 15

[28] Horizon was not required to file foreclosure proceedings against Kelli, and 

could instead sue on the note and obtain a judgment. See National City Bank of 

Indiana v. Morris, 717 N.E.2d 934, 939 n.2 (Ind. Ct. App. 1999) (“Of course, a 

mortgagee is not obligated to seek foreclosure. She may sue on the note and 

obtain a judgment.”), trans. denied. The collection of the promissory note is not 

governed by Ind. Code chapter 32-30-10.5 because that chapter applies only to 

first mortgages, and the promissory note was a second mortgage on the 

Redwood Property. Ind. Code § 32-30-10.5-5 defines mortgage as a “loan” or 

a:

consumer credit sale; that is or will be used by the debtor primarily for 

personal, family or household purposes and that is secured by a 

mortgage (or other consensual security interest) that constitutes a first 

lien on a dwelling or on residential real estate upon which a dwelling is 

constructed or intended to be constructed.

[29] Finally, Ind. Code chapter 32-30-10.5 does not apply if “the mortgage is 

secured by a dwelling that is not occupied by the debtor as the debtor’s primary 

residence.” Ind. Code § 32-30-10.5-8(e). Kelli was not living in the Redwood 

Property when Horizon filed its claim, as she had been ordered to vacate the 

real estate thirty days after the divorce court entered its order on May 18, 2011.3

 

3 Horizon also argues the trial court properly granted summary judgment in favor of Horizon with regard to 

Kelli’s counterclaim alleging constructive fraud. As Kelli makes no argument regarding that portion of the 

trial court’s order, we do not address it.
Court of Appeals of Indiana | Memorandum Decision 46A03-1404-CC-129 | April 6, 2015 Page 15 of 15

[30] As Kelli’s response to Horizon’s motion for summary judgment did not raise 

genuine issues of material fact, and her assertions of the law are incorrect, the 

trial court did not err when it granted summary judgment in favor of Horizon.

[31] Affirmed.

Riley, J., and Robb, J., concur.