Court of Appeals of Indiana | Opinion 40A01

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A TTORNEY FOR A PPELLANT S Leanna Weissmann Lawrenceburg , Indiana A TTORNEY FOR A PPELLEE Greg S. Morin Montgomery, Elsner & Pardieck, LLP Seymour, Indiana



### I N T H E 

# COURT OF APPEALS OF INDIANA

Otter Creek Trading Company, Inc., and Daniel Pohle , Appellant s - Defendants ,

v. 

### PCM Enviro PTY, LTD , Appellee

- Plaintiff

. June 7, 2016 Court of Appeals Ca se No. 40A01

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- 1432 Appeal from the Jennings Superior Court The Honorable Matthew D. Bailey , Special Judge Cause No. 40D01

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### Bradford , Judge
.


# Case Summary

[1] Appellant

- Defendant Otter Creek Trading Company is operated by Appellant

Defendant Daniel Pohle (collectively, “Defendants”) and manufactures and sells lead s melters. Appellee

- Plaintiff PCM Enviro PTY, LTD (“PCM”), is an Australian company owned and operated by Craig Mitchell and his brother Paul that recycles lead shot collected from shooting clubs. In 2014, Craig, in his capacity as operator of PCM, arrange d to purchase a smelter from Otter Creek and paid for it in full. Defendants, however, did not ship the smelter orCourt of Appeals of Indiana | Opinion 40A01

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another part (purchased separately and called a Broekema belt ) that Defendants had offered to ship along with the smelter and which the defe ndant Pohle had retrieved from a shipping company in Edinburg h , Indiana

.

[2] PCM sued Defendants for breach of contract and for conversion of the Broekema belt. Pohle, pro se , filed a letter with the trial court, alleging that Defendants had no signed contr act with PCM and that he had never driven to Minnesota to collect the Broekema belt. After the trial court advised Defendants to secure legal representation, they did for a time but filed no further response to PCM ’s complaint. Eventually, the trial cour t entered default judgment against Defendants and held a hearing on damages. After the hearing, the trial court ordered a total of approximately $147,000.00 in damages, which included the price of the smelter, lost profits, the value of the Broekema belt, and punitive damages for conversion. Defendants appeal, contending that the trial court erred in entering default judgment, in denying their motions to correct error and for relief from judgment, and in calculating damages. Finding no error, we affirm.



# Facts and Procedural History

[3] Otter Creek is an Indiana corporation operated by Pohle which manufactures and sells lead s melters to customers outside the United States. PCM is an Australian company owned and operated by Craig and his brother Paul that

re cycles lead shot collected from shooting clubs. In July of 2014, Craig, in his capacity as operator of PCM, arranged to purchase a smelter from Otter CreekCourt of Appeals of Indiana | Opinion 40A01

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and paid for it in full by July 31, 2014. Otter Creek, however, did not ship the smelter. At some point before deciding not to ship the smelter, Pohle told PCM that there would be room in the smelter packaging and invited PCM to ship other items to Otter Creek so that they could be shipped with the s melter. PCM desired to ship a part called a Broekem a belt ( purchased from a company in Minnesota ) along with the smelter, and, to that end, Pohle retrieved PCM’s Broekema belt from the freight company in Edinburgh, Indiana. At one point, Pohle refused to release the Broekema belt to a friend of Craig ’ s who had driven from Wisconsin.

[4] On October 17, 2014, PCM filed its complaint against Defendants , a lleging that they had breached the contract for the purchase of the smelter and that they had converted the Broekema belt:

COMPLAINT Plaintiff, [PCM] com plains of the Defendants ... and alleges and says: I

. PARTIES 1. [PCM] is now, and at all times mentioned in this complaint was, a corporation duly organized and existing under the laws of Australia, with their principal place of business located in Melbourn e, Victoria, Australia. 2. [Pohle] is currently a resident of the County of Jennings, Indiana, and is president of [Otter Creek]. 3. [Otter Creek] is now, and at all times mentioned in this complaint was, a corporation duly organized and existing under the laws of State of Indiana, with their principal place of business located in Jennings County, Indiana, andCourt of Appeals of Indiana | Opinion 40A01

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II. COUNT I BREACH OF CONTRACT 4. [Otter Creek], by its presid ent, [Pohle], offered to manufacture a nd provide a three (3) ton gas fired lead smelter to PCM. 5. [PCM] accepted Defendant ’ s offer on or about July 5, 2014, to have Defendant manufacture a three (3) ton gas fired lead smelter. 6. Plaintiff was to pay De fendant a total of $15,000.00 per the terms of the contract with half the amount due initially and the remaining half due upon completion of the smelter. 7. Plaintiff complied with the terms of the contract and made both payments representing $15,000.00 in total to Otter Creek via wire transfer. 8. On August 7, 2014, [Otter Creek] sent a letter signed by Pohle, as president, to PCM stating the three (3) ton gas fired lead smelter was completed, tested and that they were waiting on F.O.B. shipping instructio ns from PCM. 9. The August 7, 2014 letter also stated the $15,000.00 owed by PCM had been paid. 10. [Defendants] have refused to release or ship the smelter since this time even after shipping instructions were supplied and repeated demands by PCM. 11. P ohle falsely claims that PCM and [Craig] intend to steal his intellectual property by purchasing the smelter and copying it. 12. [Defendants] have refused to return the $15,000.00 they received to perform this contract to PCM. 13. [Defendants] have breac hed the contract with PCM by their failure to perform their obligations under theCourt of Appeals of Indiana | Opinion 40A01

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III. COUNT II CONVERSION 15. The allegations of rhetorical paragraphs four through fourteen are incorporated herein by reference. 16. PCM had contracted with a third party, Lead Us Reclaim, LLC, of Augusta, Wisconsin, to purchase a Broekema USA belt. 17. [Def

endants] had agreed to ship the belt with the above

mentioned smelter to PCM. 18. On August 5, 2014, Pohle drove to Broekema USA and told them that he was picking up a belt to package with the lead smelter that was to be shipped to PCM. 19. The Broekema be lt was released to Pohle and he signed a Conway Freight delivery receipt for the belt. 20. PCM had arranged for shipping for the lead smelter and belt on three separate occasions but Pohle refused to release the equipment and complete his performance of the contract. 21. The belt in Pohle ’ s possession has never belonged to him and he has refused to return or release the belt after multiple demands by PCM and [Craig]. 22. Pohle has intentionally converted the belt he was to ship with the smelter to PCM by keeping the belt for his own use and knowing he never ha [d] permission from PCM to retain the belt. 23. Plaintiff has suffered significant loss and damage due to the conversion of Plaintiff ’ s Broekema belt and money by [Defendants].Court of Appeals of Indiana | Opinion 40A01

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24. Defendants th rough conversion and theft have deprived PCM of the entire value of the belt and equipment along with all profits past and future. WHEREFORE, Plaintiff, PCM, demands judgment against the Defendants, in an amount adequate to fully and fairly
com pensate him for his damages, prejudgment interest, punitive and treble damages, attorney fees, the cost of this action, and for all other a ppropriate relief. Appellant ’ s App. pp. 23

- 25.

[5] On November 10, 2014, Defendants filed a letter with the trial court, which stated, in part,
a) At no time has Otter Cr eek Trading Co., Inc. nor Daniel L. Pohle ever entered into any signed agreement with an y Corporation, Company, Resident or Citizen of the Country of Australia. b) I, Daniel L. Pohle, did not travel to Minnesota where Broekema USA is located in reference to any belt. Appellant ’ s App. p. 26.

[6] On November 12, 2014, Defendants filed a discovery request with the trial court requesting PCM ’ s articles of incorporation and Craig ’ s international travel records, proof of residence, and address. On November 18, 2014, the trial court urged Defendants to seek the assistance of counsel. On November 26, 2014, Defendants filed a letter thanking the trial court and informing it th at they would be retaining counsel and attempting to have the matter transferred to federal court. On December 18, 2014, counsel for Defendants filed an appearance and moved for a forty

- five day extension of time within which to
answer PCM ’ s complaint, wh ich motion the trial court granted. On DecemberCourt of Appeals of Indiana | Opinion 40A01

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29, 2014, counsel for Defendants withdrew his appearance. Defendants filed no further response to PCM ’ s complaint within the forty

- five

- day extension period.

[7] On February 5, 2015, PCM moved for default jud gment on the basis that Defendants had not filed an answer to its complaint. That day, the trial court entered default judgment in favor of PCM and ordered a hearing for the purpose of setting damages. On May 22, 2015, the trial court held a hearing on

t he issue of damages. On June 17, 2015, the trial court issued its judgment for damages, finding that PCM had suffered damages of $15,000 for money retained, $127,256.50 for lost profits, $1281.30 for money spent on the converted Broekema belt, and $3000.0 0 in punitive damages, totaling $146,537.80. That day, the trial court also denied Defendants ’ motion to dismiss PCM ’ s complaint. On J uly 17, 2015, Defendants filed a motion to

correct error and for relief from judgment , which the trial court denied.

[8] D efendants argue on appeal that (1) the trial court erred in entering default judgment against them because they adequately answered PCM ’ s complaint, (2) the trial court abused its discretion in denying their motion to correct erro r and for relief from judg ment , and (3) the trial court abused its discretion in determining PCM ’ s damages. PCM responds that (1) the trial court properly entered default judgment in its favor because Defendants filed multiple letters with the trial court but never admitted or den ied any of PCM ’ s allegations, (2) the trial court did not abuse its discretion in denying Defendant s’ motion toCourt of Appeals of Indiana | Opinion 40A01

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correct error and for relief from judgment , and (3) the trial court properly awarded damages for lost profits to PCM.



# Discussion and Decision
I. Whether the Trial Court Abused its Discretion in Entering Default Judgment in Favor of PCM

[9] Indiana Rule of Trial Procedure 8( B ) provides, in part, that “[a] responsive pleading shall state in short and plain terms the pleader ’ s defenses to each claim asserted and shall admit or controvert the averments set forth in the preceding pleading. ” Trial Rule 8(D) provides , in part, that “ [a] verments in a pleading to which a responsive pleading is required, except those pertaining to amount of damages, are adm itted when not deni ed in the responsive pleading. ” “When a party against whom a judgment for affirmative relief is sought has failed to plead or otherwise comply with these rules and that fact is made to appear by affidavit or otherwise, the party may be defaulted by the court.” Trial R . 55 (A).

[10] “ A judgment by default which has been entered may be set aside by the court for the grounds and in accordance with the provisions of Rule 60(B). ” Trial R.
55 (C).

The trial court ’ s resolution of these questions , on both entering and setting aside a default judgment, is a matter of discretion, and we will reverse a ruling on these questions only for an abuse of discretion. Taco Bell Corp. v. United Farm Bureau Mut. Ins. Co

. (1991), Ind. App., 567 N.E.2d 163, 165 , trans. denied ; [ Green v. Karol , 166 Ind. App. 467, 473, 344 N.E.2d 106, 110. ] That is, weCourt of Appeals of Indiana | Opinion 40A01

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will reverse only “if the trial court ’ s decision is clearly against the logic and effect of the facts and circumstances before the court, of the reasonable, probab le, and actual deductions to be drawn therefrom.” Myers v. Myers (1990), Ind., 560 N.E.2d 39, 42. State, Dep ’

t of Nat. Res. v. Van Keppel , 583 N.E.2d 161, 163 (Ind. Ct. App. 1991) , trans. denied

. 

### A. Count I

[11] In Count I, PCM alleges that Defendants entered into a contract with PCM to provide it a lead smelter in exchange for $15,000.00 and accepted payment, but never delivered the smelter or returned payment. Defendants ’ entire response to these allegations was: “At no time has Otter Creek Trading Co., Inc. no r Daniel L. Pohle ever entered into any signed agreement with any Corporation, Company, Resident or Citizen of the Country of Australia.” Appellant ’ s App. p. 26. Because t his response neither confirms nor denies any of PCM ’ s specific allegati ons, they are deemed admitted pursuant to Trial Rule 8( D). Moreover, the response does not in any way directly respond to PCM ’ s contract claim , as PCM did not allege that it had a signed contract with Defendants. Simply put, even if we assume that Defend ants have not ever entered into a signed agreement with PCM or any other Australian company, that would not help Defendants in this case because it does not represent a valid defense to PCM’s contract claim . Although , in general , a valid contract for the sale of goods for more than $500.00 must be in writing and signed by the party against whom enforcement is sought, a contract that does not meet these requirements is enforceable “with respect to goods for which payment has been made andCourt of Appeals of Indiana | Opinion 40A01

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accepted or which have been received and accepted[.]” Ind. Code § § 26

- 1

- 2

- 201(a),

- 201(c). The trial court did not abuse its discretion in entering default judgment in favor of PCM on Count I.

[12] We are cognizant that Indiana has adopted the principles of notice pleading: “All pleadings shall be so construed as to do substantial justice, lead to disposition on the merits, and avoid litigation of procedural points.” Trial R. 8(f). That said, the defects in Defendants’ answer to PCM’ s contract claim were not merely of form ; the content of the answer simply did not address any of PCM’s actual allegations . Our research has uncovered no Indiana case where a similarly non

- responsive answer was deemed adequate under Trial Rule 8(b), and, while recent cases directly on point can not be found, our conclusion is consistent with binding Indiana authority.

[13] In the 1895 case of Moore v. Morris , 142 Ind. 354, 41 N.E. 796 (Ind. 1895), the

a ppellees sued the appell ants for fraud in the procurement of deeds from one of the appellees to ce rtain lands in Hamilton County when that appellee was allegedly of unsound mind. Id . at 354 , 41 N.E. at 796. Appellants ’ response was based chiefly on the allegation that appellants were residents of Marion County and could not be sued in Hamilton County on a merely personal action. Id . The Indiana Supreme Court found this response to be inadequate, as it did not foreclose the possibility that appellants were Hamilton Cou nty residents when the action was begun. Id . Put another way, the response in Moore did not directly respond to the allegations in the complaint and therefore did notCourt of Appeals of Indiana | Opinion 40A01

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necessarily provide a defense to the complaint, even if the averment were assumed to be true.

[14] In Wilson v. Evansville & Cleveland Railroad Co. , 9 Ind. 510 (1857), a suit upon a stock subscription, the complaint alleged that a Willard Carpenter had made the stock subscription on behalf of the defendant, who later ratified it. Id . at 510. The defendant answered, denying that he had made any stock subscription. Id

. The Indiana Supreme Court concluded that the answer was inadequate because it was non

- responsive:
In this case, however, it is plain that the answer does not meet t he allegations in the complaint. The latter avers that Willard Carpenter subscribed, and the defendant afterwards ratified. The former asserts that the defendant did not subscribe. It is true, the legal effect of the ratification, if a valid one, would be to make the defendant liable as a subscriber; but that liability, strictly speaking, would arise from the ratification, not the making of a subscription. The answer should have directly met the allegations in the complaint. It impliedly admits them. It is a kind of a negative pregnant. Id . at 511. We see no way to meaningfully distinguish the instant case from the binding precedent of Moore and Wilson . In failing to directly meet the allegations in Count I, Defendants have impliedly admitted them.


### B. Count II

[15] In Count II, PCM alleges that Defendants took possession of a Broekema belt that it had purchased, retained possession without PCM ’ s permission, and have refused to return the Broekema belt. Defendant Pohle ’ s response was “I,Court of Appeals of Indiana | Opinion 40A01

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Daniel L. Pohle , did not travel to Minnesota where Broekema USA is located in reference to any belt.” Appellant ’ s App. p. 26. Again, this response neither confirms nor denies any of PCM ’ s allegations, which are therefore deemed admitted. At most, Pohle denies that he traveled to Minnesota to collect the Broekema belt, something that PCM did not specifically allege. In any event, Defendants’ denial is hardly material, as the place where Pohle took possession of the Broekema belt is not an element of conversion. Defend ants do not deny that they took possession of the Broekema belt or that they still have it. As with
PCM ’ s first claim, because Defendants’ response did not directly meet PCM’s allegations, Defendants have impliedly admitted them. T he trial court did not abuse its discretion in entering default judgment in favor of PCM.


## II. Whether the Trial Court Abused its Discretion in Denying Defendants ’ Motion s to Correct Error and Motion for Relief From Judgment

[16] “We review a denial of a request for new trial presented by a Trial Rule 59 motion to correct error or a Rule 60(B) motion for relief from judgment for abuse of discretion.” Speedway SuperAmerica, LLC v. Holmes , 885 N.E.2d 1265, 1270 (Ind. 2008).

A tria l court has abused its discretion only if its decision is clearly against the logic and effect of the facts and circumstances before the court or the reasonable inferences therefrom. The trial court ’ s decision comes to us cloaked in a presumption of
corre ctness, and the appellant has the burden of proving that the trial court abused its discretion. In making our determination, we may neither reweigh the evidence nor judge the credibility ofCourt of Appeals of Indiana | Opinion 40A01

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witnesses. Instead, we look at the record to determine if: “(a) the trial court abused its judicial discretion; (b) a flagrant injustice has been done to the appellant; or (c) a very strong case for relief from the trial court ’ s [order] ... has been made by the appellant.” Volunteers of Am. v. Premier Auto Acceptance Co rp. , 755 N.E.2d 656, 658 (Ind. Ct. App. 2001) (citations omitted).



### A. Motion to Correct Error

[17] Most of Defe ndants ’ specific argument s in this section boil down to claims that they are entitled to relief based on the following , which Defendants seem to char acterize as claims of newly

- discovered evidence : PCM did not legally exist when it arranged to purchase the smelter from Defendants, PCM did not follow Indiana law when filing its complaint against Defendants, and Defendants did not ship the smelter to PC M due to Craig ’ s failure to adequately verify his identity

. “Motions predicated upon newly discovered material evidence are viewed with disfavor.” Kimmel v. State (1981), 275 Ind. 575, 418 N.E.2d 1152, 1157. Whether to grant a new trial on the grounds of newly discovered evidence is within the discretion of the trial court, and, on appeal from a denial of the motion, we reverse only if the trial court could not reasonably have reached a conclusion that, upon retrial, a different result was not probable. Id

. Laudig v. Marion Cty. Bd. of Voters Registration , 585 N.E.2d 700, 712 (Ind. Ct. App. 1992), trans. denied

.

[18] In order to obtain relief on the basis of allegedly newly

- discovered evidence, Defendants would have to establish that: (1) the evidence has been discoveredCourt of Appeals of Indiana | Opinion 40A01

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since the default; (2) it is material and relevant; (3) it is not cumulative; (4) it is not merely impeaching; (5) it is not pri vileged or incompetent; (6) due diligence was used to discove r it in time for trial; (7) the ev iden ce is worthy of credit; (8) it can be produced on a r etrial of the case; and (9) it will proba bly produce a different result. See Wiles v. State , 437 N.E.2d 35, 39 (Ind. 1982)

.

[19] At the very least, Defendants do not claim, much less establish, that ev idence related to the three specific claims they make in this section was discovered following the entry of default judgment against them on February 5, 2015. Defendants do not claim that they were unaware of the facts underlying their alleged concerns ab out PCM ’ s legal capacity to sue them in an Indiana court before default judgment was entered. A s for alleged concerns about the sufficiency of Craig ’ s identification , these surfaced soon after PCM made its final payment on the smelter according to Pohle ’ s own testimony at the damages hearing . (Tr. 95

- 97).

[20] Moreover, Defendants have shown no likelihood of a different result were they to obtain a reversal of the trial court ’ s default judgment. Defendants ’ first argument is based on the fact that PCM Envir o PTY LTD was not registered as a proprietary Australian company until July 17, 2014, which is after PCM agreed to purchase the smelter from Defendants. (Plaintiff ’ s Ex. 1). Although Defendants suggest that this somehow undermines the validity of their c ontract with PCM, we conclude that they have failed to establish that it does. PCM Enviro was registered as a business name on January 3, 2013, as an entity being held by the Treelawney Development Trust, which entity Craig testified h e andCourt of Appeals of Indiana | Opinion 40A01

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Paul “turned ... into a corporation” on July 17, 2014. Tr. p. 10. Contrary to Defendant s’ claims, the evidence seems to establish, at most, that the PCM Enviro that contracted with Defendants was a predecessor in interest to the PCM Enviro that sued them.

[21] Defendants a lso contend that PCM failed to follow Indiana law in pursuing its lawsuit. Defendants rely on Indiana Code section 23

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- 2(a), which provides that “[a] foreign corporation transacting business in Indiana without a certificate of authority may not mainta in a proceeding in any court in Indiana until it obtains a certificate of authority.” S ubsection (c) of the same statute , however, provides that
[a] court may stay a proceeding commenced by a foreign corporation, its successor, or assignee until it deter mines whether the foreign corporation or its successor requires a certificate of authority. If it so determines, the court may further stay the proceeding until the foreign corporation or its successor obtains the certificate.
[22] While PCM did not originally have a certificate of authority, it obtained one on May 21, 2015. Plaintiff ’ s Ex. 1. In any event, as Indiana Code section 23

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- 2(c) makes clear, PCM ’ s failure to obtain a certificate of authority had no effect on the validity of its lawsuit nor did it have any effect on its outcome. The only remedy Defendant would ever have been entitled to was a stay while PCM obtained a certificate of authority, whi ch is certainly not a different result.

[23] As for Defendants claim that they did not ship the smelter or Broekema belt because Craig failed to adequately identify himself, we cannot say thatCourt of Appeals of Indiana | Opinion 40A01

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Defendants have established that this argument would likely produc e a different result either. There is evidence that Craig and Paul went to some lengths to comply with Pohle ’ s request to have Craig ’ s passport “certified” by the United States Embassy in Australia and /or the Australian Government. When the requested inf

ormation was sent to Pohle, he still did not ship the smelter to PCM. In other words, there is evidence in the record that Craig took reasonable measures to identify himself to no avail. Moreover, there is also evidence that Pohle ’ s request for identific ation was a mere pretext, his true motivation for refusing to ship the smelter being fear of counterfeiting. Under the circumstances, we cannot say that raising the identification issue would have been likely to produce a different result. The trial cour t did not abuse its discretion in denying Defendants ’ motion to correct error.



### B. Motion for Relief From Judgment

[24] Trial Rule 60(B) provides, in part, that “[o] n motion and upon such terms as are just the court may relieve a party or his legal representa tive from a judgment, including a judgment by default, for the following reasons: (1) mistake, surprise, or excusable neglect [.]” “ A motion for relief from a judgment under T.R. 60(B) is addressed to the equitable discretion of the trial court.” Minnick v. Minnick , 663 N.E.2d 1226, 1228 (Ind. Ct. App. 1996)

. We review the grant or denial of

... Trial Rule 60(B) motions for relief from judgment under an abuse of discretion standard. [ Holmes, 885 N.E.2d at 1270 ] ; Outback Steakhouse of Florida v. Markley , 856 N.E.2d 65, 72 (Ind. 2006). On appeal, we will not find an abuse of discretion unless the trial court ’ s decision isCourt of Appeals of Indiana | Opinion 40A01

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clearly against the logic and effect of the facts and circumstances before it or is contrary to law. Miller v. Moore , 696 N.E.2d 888, 8 89 (Ind. Ct. App. 1998). Cleveland v. Clarian Health Partners, Inc. , 976 N.E.2d 748, 755 (Ind. Ct. App. 2012), trans. denied

.
The burden is on the movant to demonstrate that relief under T.R. 60(B) is both necessary and just. Fairrow v. Fairrow, 559 N.E.2d 597, 599 (Ind. 1990). Relief under T.R. 60(B) also requires that the movant make a prima facie showing of a meritorious defense for [reason (1)]

. Smith v. Johnson, 711 N.E.2d 1259, 1265 (Ind. 1999). A meritorious defense refers to “evidence that, if credited, demonstrates that a different result would be reached if the case were retried on the merits and that it is unjust to allow the default to stand.” Id. In re Rueth Dev. Co. , 976 N.E.2d 42, 51 (Ind. Ct. App. 2012) , trans. denied

.

[25] Much of what we said with regard to Defendants ’ argument that the trial court abused its discretion in denying its motion to correct error is relevant here. Specifically, our conclusions about the three distinct defenses raised in that argument are present he re; namely, that Defendants have failed to establish that any of them, if raised on retrial, would likely lead to a different result.

[26] Defendants, however, also argue that the overall equities of the case favor them to the extent that reversal is warrante d. We disagree with this assessment of the record. Aside from the potential defenses mentioned above, which we have already determined would be unlikely to produce a different result, Defendants also suggest that they were misled about the case, implying that they wereCourt of Appeals of Indiana | Opinion 40A01

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unaware default judgment had been entered against them on February 5, 2015, until the hearing on damages on May 22, 2015.

[27] While Defendants may have been mistaken regarding the status of the case, we cannot conclude that they were wrongful ly misled. The chronological case summary (“CCS”) contains several entries indicating both that default judgment had been entered; the May 22, 2015, hearing was to determine damages only; and Defendants were notified of all of the above. The CCS indicate s that default judgment was served on Pohle on February 11, 2015, and the default judgment order scheduled a hearing on damages only. Defendants do not claim that they were not served with the default judgment. Moreover, although Defendants claim that th eir counsel did not know until just before the damages hearing that he would be defending against a cl aim of over $145,000.00, there does not seem to be any indication of such ignorance or confusion in the record.

[28] Other circumstances weigh against Defend ants. First and foremost, once Defendants determined that they would not ship the smelter or Broekema belt to PCM, they retained both PCM ’ s money and the belt. Even assuming that Defendants had a legitimate reason to cancel the sale, they do not explain why they did not simply refund PCM ’ s payment. Pohle also seems to be somewhat less than forthright about his reason for refusing to ship the smelter to PCM, blaming the whole incident on Craig ’ s alleged failure to establish his identity. As we have menti oned, Pohle actually seemed motivated by his fear

— of which there is no evidence

— that Craig intended to appropriate his intellectualCourt of Appeals of Indiana | Opinion 40A01

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property. Defendants have failed to establish that relief from the default judgment entered against them is necessary and j ust.



## III. Damages

[29] Defendants contend that the trial court abused its discretion in computing damages, arguing that the amount awarded for lost profits was based on speculation and in awarding punitive damages related to their conversion of the Broekema b elt.


### A. Lost Profits It is axiomatic that a party injured by a breach of contract may recover the benefit of its bargain but is limited in its recovery to the loss actually suffered. Fowler v. Campbell , 612 N.E.2d 596, 603 (Ind. Ct. App. 1993). A party injured by a breach of contract may not be placed in a better position than it would have enjoyed if the breach had not occurred. Id . A damage award must be based upon some fairly defined standard, suc h as cost of repair, market value, established experience, rental value, loss of use, loss of profits, or direct inference from known circumstances. Id

. The damages claimed also must be the natural, foreseeable, and proximate consequence of the breach. Id . The foreseeability of damages is based upon facts known at the time of entry into the contract, not facts existing or known at the time of the breach. Berkel & Co. Contractors, Inc. v. Palm & Associates, Inc. , 814 N.E.2d 649, 658

- 59 (Ind. Ct. App. 20 04). A party injured by a breach of contract may recover consequential damages from the breaching party. Rockford Mut. Ins. Co. v. Pirtle , 911 N.E.2d 60, 67 (Ind. Ct. App. 2009), trans. denied . “Such consequential damages may include lost profits, provid ing the evidence is sufficient to allow the trier of fact to estimate the amount with a reasonable degree of certainty andCourt of Appeals of Indiana | Opinion 40A01

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exactness.” Clark ’

s Pork Farms v. Sand Livestock Systems, Inc. , 563 N.E.2d 1292, 1298 (Ind. Ct. App. 1990). Consequential damages
m ay be awarded if the non

- breaching party ’ s loss flows naturally and probably from the breach and was contemplated by the parties when the contract was made. Rockford , 911 N.E.2d at 67. The party seeking such damages bears the burden of proving by a prepo nderance of the evidence that the breach was the cause in fact of its loss. Id . “This generally limits consequential damages to reasonably foreseeable economic losses.” Id

. L.H. Controls, Inc. v. Custom Conveyor, Inc. , 974 N.E.2d 1031, 1043 (Ind. Ct. Ap p. 2012).
When the specific issue on review relates to a question of inadequate or excessive damages, we will not reverse a damage award if it is within the scope of the evidence before the trial court, and we neither reweigh the evidence nor judge the
c redibility of the witnesses. Randles v. Ind. Patient ’ s Comp. Fund , 860 N.E.2d 1212, 1230 (Ind. Ct. App. 2007), trans. denied. Ponziano Const. Servs. Inc. v. Quadri Enterprises , LLC , 980 N.E.2d 867, 873 (Ind. Ct. App. 2012)

.

[30] Craig testified that he com municated the importance of receiving the smelter from Pohle, specifically, that PCM had just “done a deal” with a company named Champion Ammunitions to provide lead ingots. Tr. p. 40. The contract with Champion provided, inter alia , that PCM was to be p aid a price tied to the price of lead listed on the London Metal Exchange (“LME”) at the time

. Craig also testified that Defendants ’ failure to deliver the smelter rendered them unable to fulfil l their contract with Champion. Finally, Craig introduced evidence that, based on the LME price of lead at relevant times, the amounts of lead that PCM anticipated delivering but did not, and PCM ’ s costs, PCM ’ s lostCourt of Appeals of Indiana | Opinion 40A01

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profits were $127,256.50. Defendants argue that Craig did not mitigate PCM ’ s damages by failing t o identify himself sufficiently and PCM ’ s valuation of the lead it would have sold to Champion was artificially high. As we have mentioned, Craig made reasonable efforts to comply with Defendants ’ request to identify himself. Moreover, Defendant s’ argume nt regarding valuation amounts to an invitation to reweigh the evidence heard and evaluated by the trial court , which we will not do. Defendants have failed to establish that the trial court abused its discretion in awarding damages for lost profits.



### B. Punitive Damages

[31] Defendants claim that insufficient evidence supports the trial court ’ s award of $3000.00 in punitive damages to PCM for Defendants ’ conversion of the Broekema belt.
The standard for determining if punitive damages were properly awarded is whether, considering only the probative evidence and the reasonable inferences supporting the judgment, a reasonable trier of fact could find by clear and convincing evidence that the defendant acted with malice, fraud, gross negligence or oppressivenes s which was not the result of a mistake of fact or law, honest error of judgment, overzealousness, mere negligence, or other human failing. Punitive damages may also be awarded upon a showing of willful and wanton misconduct. Punitive damages are those d esigned to punish the wrongdoer and to discourage him and others from similar conduct in the future. Because they are awarded in addition to damages that compensate for the specific injury, the injured party has already been awarded all that he is entitle d to as a matter of law. Therefore, the sole issue is whether the defendant ’ s conduct was so obdurate that he should be punished for the benefit of theCourt of Appeals of Indiana | Opinion 40A01

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general public. Punitive damages are awarded upon a showing of intentional conduct, which focuses on t he defendant ’ s state of mind. INS Investigations Bureau, Inc. v. Lee , 784 N.E.2d 566, 582

- 83 (Ind. Ct. App. 2003) (citations omitted), trans. denied

.

[32] Even if one takes Pohle ’ s professions of concern about Craig ’ s identity at face value, this has nothi ng to do with the Broekema belt

. Defendants took possession of the Broekema belt and apparently kept it instead of allowing PCM to arrange alternate shipping to Australia. Indeed, Pohle refused to release the belt to Bill Moss, a friend of Craig ’ s that dro ve from Wisconsin on Craig ’ s behalf to retrieve it. Defendants had no legitimate interest in the Broekema belt which would justify refusing to release it to Moss. Given Pohle ’ s belief that Craig was attempting to “clone” his smelter, t r. p. 97, the trial court could reasonably infer that he harbored some malice toward Craig and PCM, which motived his conversion of the Broekema belt. The record contains sufficient evidence to sustain the trial court ’ s award of $3000.00 in punitive damages.



# Conclusion

[33] We conclude that the trial court did not abuse its discretion in entering default judgment in favor of PCM or in denying Defendants’ motions to correct error and for relief from judgment. We further conclude that the trial court did not abuse its discreti on in determining PCM’s compensatory damages from lost profit or punitive damages for Defendants’ conversion of the Broekema belt.Court of Appeals of Indiana | Opinion 40A01

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The judgment of the trial court is affirmed.
Bailey, J., and Altice, J., concur.