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.

ATTORNEYS FOR APPELLANTS: ATTORNEYS FOR APPELLEE:

STEVEN K. HUFFER JAMES R. FISHER

JOSHUA F. BROWN DEBRA H. MILLER

S.K. Huffer & Associates, P.C. Miller & Fisher, LLC

Carmel, Indiana Indianapolis, Indiana

IN THE

COURT OF APPEALS OF INDIANA

PERFORMANCE MATTERS )

ASSOCIATES and CONSECO )

MARKETING, LLC, )

)

Appellants-Defendants, )

)

vs. ) No. 29A05-1107-PL-361

)

PATRICK A. FORTUNE, )

)

Appellee-Plaintiff. )

APPEAL FROM THE HAMILTON SUPERIOR COURT

The Honorable William J. Hughes, Judge

Cause No. 29D03-0704-PL-393

June 5, 2012

MEMORANDUM DECISION - NOT FOR PUBLICATION

ROBB, Chief Judge
2

Case Summary and Issues

Performance Matters Associates, Inc. (“PMA”), and Conseco Marketing, LLC 

(“Conseco Marketing”) (collectively referred to as the “Defendants”), appeal the trial court’s 

judgment in favor of Patrick Fortune on his complaint for breach of contract and accounting. 

Defendants raise several issues for our review, of which we find the following dispositive: 

whether the trial court clearly erred in finding the Defendants breached the parties’ 

Agreement and therefore erred in entering judgment for Fortune. Concluding the trial court 

did not clearly err, we affirm.

Facts and Procedural History

Conseco Marketing is a wholly-owned subsidiary of Conseco, Inc. Conseco 

Marketing contracts with independent agents who sell Conseco1insurance products. PMA is 

an independent marketing organization that recruits, trains, and provides support to insurance 

agents. PMA is also a wholly-owned subsidiary of Conseco, Inc.

Fortune, under the PMA umbrella, entered into a Sales Representative Agreement (the 

“Agreement”) with Conseco Marketing dated September 19, 2004.2 The Agreement, in 

relevant part, stated:

II. AGREEMENT DATE

The Agreement Date applies to all Policies issued on or after the Agreement 

Date, which is specified on the signature page of this Agreement.

* * *

 

1

 Several different entities, all with “Conseco” in the name, were involved in these events. Where it is 

Conseco Marketing, the remaining defendant in this case, we have so noted. Where it is any other Conseco 

entity, we have referred to it as “Conseco” for simplicity’s sake.

2

 Fortune had also entered into other contracts with Conseco Marketing or its predecessors on earlier 

dates, but all parties agree the 2004 Agreement is the governing document in this dispute. 
3

III. DUTIES, OBLIGATIONS, AUTHORIZATION AND LIMITATIONS

* * *

5. So long as this [A]greement is in effect, you will not solicit insurance 

policies for an insurance company that is not a Conseco company unless the 

Company has given you prior written authorization to do so.

* * *

16. . . . You attest that you are familiar with and understand the terms and 

conditions of the Policies and the supporting marketing literature made 

available by us in connection with any of the Policies which you sell under this 

Agreement.

* * *

18. You agree that you will sell Policies and otherwise perform under this 

Agreement in compliance with all applicable federal and state laws, statutes, 

regulations and guidelines and within all the Company’s rules and procedures 

which are intended to implement or which are otherwise related to such laws, 

statutes, and regulation guidelines. You acknowledge the Company’s 

obligation to investigate alleged breaches of such laws, statutes, regulations, 

guidelines, rules or procedures, as it may deem appropriate, and to act on the 

findings of such investigations. You further agree to cooperate fully in any 

investigation.

* * *

22. You agree to conduct your activities in a professional manner and in 

accordance with all laws and regulations in force in the states in which you 

market any Conseco Company’s products. You agree to comply and cooperate 

with the Company in any investigations and understand that this Agreement 

can be terminated for cause for your failure to cooperate or comply with the 

company’s market conduct related rules, procedures or guidelines. You agree 

to adhere to and subscribe willingly to Conseco’s Corporate Code of Conduct, 

which goes beyond minimum legal requirements . . . .

* * *

VIII. COMPENSATION

* * *

2. Your compensation shall be based on premiums paid on Policies issued by 

us on applications obtained by you prior to the termination date of this 

Agreement, at the rates specified in the attached Compensation Schedules.

* * *

7. Compensation payable under this Agreement will continue to be paid after 

the date of termination for business submitted by you prior to the effective date 

of such termination of this Agreement according to the vesting terms of the 

attached Compensation Schedules, unless compensation is forfeited under 

Section IX, item 2, of this Agreement.[3]

 

3 This reference would appear to be a typographic error, as Section IX, item 2 concerns advance 
4

* * *

X. TERMINATION

1. Termination without Cause

a. Either party may terminate this Agreement by giving written notice 

to the other party at least thirty (30) days prior to such termination date. 

. . .

* * *

2. Termination for Cause

This Agreement will be immediately terminated for cause:

a. Upon failure to perform any of its material obligations or covenants 

and failure to conform to the rules and regulations of the Company. . . .

b. Upon reason of fraud or willful or negligent violation of any federal 

or state statute or other directive affecting policies or the solicitation of 

policies issued by any Conseco Company, or misappropriation or 

withholding of funds, or any action taken or sanctioned by you without 

our prior knowledge and approval which results in the cancellation or 

surrender of policies issued by any Conseco Company.

c. If your license to act as an insurance agent or broker is revoked for 

cause after an opportunity for a hearing by the insurance department of 

any state or territory.

d. If you, while this Agreement is in force or within two years 

following its termination, endeavor to induce representatives to 

discontinue their contracts or appointments with the Company or the 

Conseco Companies or if you at any time, before or after termination of 

this Agreement, replace or attempt to replace the business of the 

Company with that of any other insurance carrier. . . .

e. If you fail to pay an indebtedness to the Company on Demand.

f. If you otherwise acted to prejudice materially the interests of 

Company in breach of this Agreement.

* * *

* * *

5. Upon termination for cause, all rights to vested compensation will be 

forfeited. You agree that this provision will survive the termination of this 

Agreement, and that the Company is entitled to divest you of your 

compensation should you engage in activities described in Section IX (2)(c) or 

Section IX (2)(e)[4]after this Agreement is terminated.

* * *

 

compensation; whereas Section X, item 2 concerns termination for cause which can trigger forfeiture of 

compensation. Because our resolution of the issues does not require us to reach the issue of forfeiture, 

however, the error, if any, is irrelevant.

4

 Again, this would appear to be a typographic error, as there is no item 2(c) or 2(e) in Section IX.
5

XI. NON-WAIVER

Forbearance or neglect of the Company to insist upon the performance of any 

of the terms of this Agreement or to declare a forfeiture or termination against 

you shall not constitute a waiver of such rights and privileges.

XII. ENTIRE AGREEMENT AND PRIOR AGREEMENTS

This Agreement is the sole and entire agreement between the parties. Any 

understandings, negotiations, representations, statements, promises and 

agreements, oral or otherwise, not included in this Agreement shall have no 

force and effect in the construction of the rights and obligations of the parties 

except as provided in this Section XI [sic]. Compensation Schedules for this 

Agreement and any subsequent changes to such Compensation Schedules shall 

apply only to new applications submitted by and through you after such 

become effective. Any compensation payable under a prior Agreement shall 

continue to accrue in accordance with the rates specified in the Compensation 

Schedules in force at time of policy issue. Payment of such accrued 

compensation is subject to any liens, indebtedness or assignments, and is 

subject to forfeiture under Section IX of this Agreement.

Appellants’ Appendix at 236-41. Fortune described his compensation as comprised of a 

first-year commission when he sold a new policy that was a percentage of the yearly premium 

and then a commission each year thereafter that the policy was renewed that was a smaller 

percentage of the yearly premium. After a certain number of years, the renewal commissions 

on a policy were vested, and he would continue to receive the renewal commissions even 

after the Agreement was terminated, provided it was not terminated for cause.

Fortune sold products for a predecessor of Conseco and for Conseco for several years 

prior to the effective date of the Agreement. During this time, Fortune was “flagged” for 

four instances in which he wrote the wrong birthdate for a customer on an application. Id. at 

283. Notwithstanding these errors, Conseco Marketing thereafter entered into the Agreement 

with Fortune. In late 2004 and early 2005, Conseco received three complaints about Fortune, 

including a complaint that he failed to terminate a policy as the policyholder requested (the 
6

“Swank complaint”), a complaint that he convinced policyholders to convert and upgrade a 

policy by giving them erroneous information about their return of premium benefits (the 

“Bish complaint”), and a complaint that he entered the birthdate of a policyholder incorrectly 

on an application which appeared to make her eligible for coverage for which she was not 

actually eligible due to her age (the “Nelson complaint”). Conseco investigated each 

complaint, including requesting information from Fortune, which he did provide. Conseco 

ultimately determined the Swank and Bish complaints had no merit. 

As for the Nelson complaint, Fortune sold to a customer a Heart Care policy which 

required the insured be under the age of seventy-five. The customer’s date of birth is 

November 15, 1924, which meant that when Fortune called on her in January of 2004, she 

was seventy-nine. Fortune, however, wrote her date of birth as November 19, 1928, on the 

application, making it appear that she was seventy-four. Fortune testified he obtained the 

birthdate information from Conseco’s agent call center, that he wrote it on the application 

and showed it to the customer, and that she affirmed the information was correct before she 

signed the application. Conseco determined this was a material misrepresentation requiring 

the policy be cancelled. The customer’s premiums were returned to her.

On April 8, 2005, Conseco terminated the Agreement with Fortune for cause:

This letter is written notification that under the Termination for Cause 

provision of your contract with Conseco Companies, your contract will be 

terminated immediately . . . . 

* * *

All rights to vested compensation with [Conseco Companies] are hereby 

forfeited pursuant to your contract. The company has divested you of all 

compensation and you shall immediately pay us all sums due to the company. 

The forfeited commissions will not offset any monies due to the company.
7

Id. at 249-51.5 Fortune sought additional information regarding the reason for his 

termination. By letter dated April 29, 2005, Fortune was informed that there were “several 

reasons” for his termination: 

First, you have failed to fully cooperate in any investigation. Second, you 

failed to understand the terms and conditions of the policies and the marketing 

literature for the policies you sold under the Agreement. Third, you failed to 

adhere to the company’s market conduct related rules, procedures and 

guidelines. Fourth, you failed to comply with the company’s Corporate Code 

of Conduct in relation to misrepresentation of any policy benefit, condition or 

limitation.

Id. at 258. Fortune received no commissions after April 8, 2005.

In April 2007, Fortune filed a complaint for breach of contract, accounting, and 

declaratory judgment against PMA, Conseco Marketing and other Conseco companies.6 In 

early 2011, the case was tried to the bench. The trial court entered extensive findings of fact 

and conclusions of law, including the following:

15. On April 8, 2005, several letters were issued to [Fortune]. These 

letters notified [Fortune] that his termination had been changed from “notice” 

to “cause” . . . . The written letters of termination (“termination letters”) 

delivered to Fortune, and dated April 8, 2005, advised Fortune that Conseco 

had determined that Fortune had forfeited his right to receive vested 

compensation pursuant to [the Agreement]. . . . 

16. The termination letters constituted Conseco’s breach of its contract 

with Fortune unless Fortune’s commissions were properly and legally forfeited 

under the terms of the [Agreement].

* * *

 

5

 Fortune apparently had separate appointments with Conseco Companies to sell insurance products 

from Conseco Health Insurance Company, Conseco Life Insurance Company, and Conseco Annuity Assurance 

Company; hence he received three termination letters, identical but for the company identification therein.

6

 Conseco Marketing filed a counterclaim against Fortune regarding a “Settlement Agreement and 

Mutual Release” in another matter which Fortune allegedly breached. The trial court found against Conseco 

Marketing on its counterclaim, and no issue is raised on appeal with regard to that part of the judgment.
8

18. The [Agreement] expressly provides that it “applies to all Policies 

issued on or after the Agreement Date, . . . .” The Agreement Date is defined 

as that which is specified on the last page of the [A]greement. The only date 

on the last date of the [Agreement] is the date it was signed by [Fortune], 

September 19, 2004. The Court finds that the [A]greement by its express and 

unambiguous terms does not apply to any policy issued prior to September 19, 

2004.

* * *

22. As a matter of law, termination of the [Agreement] for cause under 

paragraph X(2) . . ., even if such termination for cause was justified, and even 

if the forfeiture provisions of the [Agreement] were enforceable, does not 

result in the forfeiture of any commissions attributable to policies issued before 

September 19, 2004. . . . 

23. The next issue is what happens to commissions for policies issued 

after September 19, 2004. In this instance pursuant to Section X(5) 

commissions due on policies issued under the terms of the [Agreement] are 

forfeited as follows:

5. Upon termination for cause, all rights to vested compensation will 

be forfeited. You agree that this provision will survive the termination 

of the Agreement, and that the Company is entitled to divest you of 

your compensation should you engage in activities described in Section 

IX (2)(c) or (e) after this agreement is terminated.

24. In regard to Section X(5), it specifically permits forfeiture of 

compensation for post termination conduct as defined in Section IX(2)(c) or 

(e). The [Agreement] contains no provision labeled Section IX(2)(c) or IX 

(2)(e). The [Agreement] does contain a Section IX(2) which provides [for 

Advanced Compensation]. The [Agreement] does contain a provisions [sic] at 

Section X(2)(c) and ([e]) which may be the intended reference in Section X(5). 

This provisions [sic] provide as follows:

Section X: TERMINATION

2. Termination for Cause

c. If your license to act as an insurance agent or broker is 

revoked for cause after an opportunity for a hearing by the 

insurance department of any state or territory.

e. If you fail to pay an indebtedness to the Company on 

Demand.

The Court need not determine whether the [Agreement] simply contains a 

typographical error in the reference found in Section X(5) because there is no 

evidence in this record that either grounds for forfeiture of compensation set 

forth in X(2)(c) or (e) exists or is relied upon by Defendants.

25. The [Agreement] is a contract of adhesion, drafted entirely by 

Conseco. . . . 
9

* * *

29. The [Agreement] purports to permit the declaration of a forfeiture 

unilaterally by Conseco as a result of any termination for “cause.” However, 

by the terms of the [Agreement] that provision is only applicable to 

commissions for policies issued on or after the Agreement Date, September 19, 

2004.

* * *

31. The record before the Court fails to provide any contractual 

justification for Defendants[’] claim that [Fortune] forfeited his rights to 

commissions on policies issued prior to September 19, 2004. While there may 

have been similar contractual provisions, those provisions are not in the record. 

. . . However, even if [an earlier] agreement had been submitted as an exhibit 

herein, it would not assist the parties in the issue of forfeiture of commission 

for policies issued prior to the date of September 19, 2004 because, the record 

is clear that this agreement was terminated by the issuance of the [Agreement] 

in September 2004. Therefore, the prior agreement was not terminated for 

cause and forfeiture of commissions would not be permissible under the terms 

of the [Agreement] and the law applicable to the strict construction of 

forfeiture provisions.

* * *

38. Conseco alleged that its termination for cause of Fortune in April 

2005 was based upon three individual complaints against Fortune: (1) the 

Swank policy cancellation request; (2) the Bish claim that she was 

misinformed about the operation of the return of premium feature; and (3) the 

error in the birth date of Miriam Nelson on two insurance policy applications.

39. . . . Conseco concluded from its investigation into the Swank 

complaint, that Fortune did nothing wrong. Fortune’s conduct, in connection 

with Swank, did not breach the [Agreement], and does not support termination 

for cause under the contract. Since such conduct does not constitute cause 

under the [Agreement] it can not serve as the basis for a forfeiture of 

compensation under the terms of the contract.

* * *

41. Conseco’s internal documents indicate that the Bish complaint had 

no merit. . . . 

42. Even [a Conseco employee] admitted in her deposition that because 

the Bish and Swank complaints were determined to be without merit, they 

“count for nothing” in a termination for cause determination, either 

individually or collectively.

* * *

50. Miriam Nelson signed three forms on January 6, 2004 in which her 

date of birth was incorrectly stated as November 19, 1928. This date appears 

to be written in each case in the handwriting of [Fortune].
10

51. Fortune claims that after the insurance applications were filled out, 

he gave the completed application forms to Miriam Nelson, asked her to read 

them, and, if all of the information was accurate, to sign. . . .

52. Miriam Nelson’s signature appears on each of the application 

forms, one for a heart policy and one for an accident policy. In each 

application there is a statement that she was certifying by her signature on each 

that her date of birth and age were those indicated on the application.

* * *

54. When the policies were delivered, Dean Nelson, son of Miriam, 

and Miriam Nelson noticed that the birth dates contained on the applications 

were inaccurate, but did not notify Conseco or Fortune of the birth date error.

55. When Conseco’s underwriting received the Miriam Nelson 

accident policy application form, Conseco’s database identified another 

accident policy that had been written for Miriam Nelson earlier, and which was 

still in place.

* * *

57. A Conseco underwriter . . . confirmed that the two policies were for 

the same person and, as a result of that examination, Mrs. Nelson was notified 

that she was not eligible for the new accident policy, because the other policy 

was already in place.

* * *

59. Conseco admits that, if Fortune received the inaccurate birth date 

information from the Conseco agent call center, and Miriam Nelson signed the 

application after reading the completed application with the inaccurate birth 

date, Fortune did nothing wrong. . . .

* * *

62. The error in the Nelson birthday appearing in the applications 

submitted by Fortune on January 6th, 2004, could have resulted from either a 

data entry error in the Conseco database, an error made by the Conseco agent 

call center in providing Fortune the information concerning the Nelson birth 

date from the Conseco database, or an error by Fortune in mishearing or 

misrecording the birth year information provided to him over the phone from 

the Conseco call center. Not one of these possible explanations of the error in 

the Nelson Birthday would justify a termination for cause by Conseco and 

PMA so long as the incorrect date was in the application at the time Miriam 

Nelson placed her signature on those forms on January 6, 2004.

63. An intentional action by Fortune in recording inaccurate birth dates 

in the Nelson applications would have justified termination of Fortune for 

cause. The burden of establishing that this is the explanation of the error in 

birthdates is upon the Defendants by a preponderance of the evidence. The 

Defendants have failed in this burden.
11

64. The submission of the Nelson applications with an inaccurate birth 

date, under the circumstances of this case, could serve [as] grounds for the 

termination of the contract for cause by Conseco. The record herein indicates 

that the at [sic] the time of the policy applications completed by Miriam 

Nelson, [Fortune] was aware that there were errors in the Conseco Agent 

Services Databases regarding dates of birth and ages. He had reported those 

dates to Conseco. He nevertheless relied upon those dates in a matter as 

critical as where the age of a potential insured could result in denial of 

coverage either at issuance or upon later claim. At the very least this was 

negligent action by [Fortune] and by the specific terms of the contract would 

permit the Defendants to terminate his contract for cause under paragraph 

X(2)(b).

65. No agent has ever previously been terminated for cause by Conseco 

as a result of an error in information contained on an application prepared by 

the agent and signed by the applicant, unless that information was altered by 

the agent after the applicant signed it. . . . This record does not support such a 

finding that the inclusion of the incorrect date of birth on the Nelson forms was

intentional to permit coverage to be issued; however, the record amply 

supports that [Fortune] was at least negligent in that determination. 

Defendants now seek to justify their claimed forfeiture to commission under a 

contract signed between the parties 9 months and 13 days after this alleged 

negligent act. Such an interpretation of the contract is unconscionable and the 

Court declines to interpret this contract as granting such a right to declare 

forfeiture.

66. At trial, Conseco and PMA identified four other instances in which 

a birth date on an insurance application obtained by Fortune contained an 

inaccurate birth date. In each of these four instances, the inaccurate birth date 

made the applicant appear to be eligible for a policy for which the applicant 

was actually too old to qualify. . . .

* * *

68. All four of [these] applications . . . were applications submitted 

prior to the effective date of the [Agreement]. The issue of the four 

applications was brought to the attention of PMA, investigated, and resolved in 

Fortune’s favor by PMA, prior to the effective date of the [Agreement]. 

Because the [Agreement] was entered into with full knowledge by PMA of the 

four applications, Conseco and PMA have waived any claim that these four 

applications may form the basis of a breach of the [Agreement].

69. Conseco and PMA allege as an additional ground for Fortune’s 

termination for cause, that Fortune did not cooperate with Conseco’s and 

PMA’s investigation of the Swank, Bish, and Nelson complaints.

70. The sole basis of the allegation that Fortune failed to cooperate 

with the investigations is the allegation that Fortune failed to respond in a 
12

timely fashion to a request for a statement concerning each of these 

complaints. Neither the [Agreement], nor any written Conseco standard policy 

or practice, establishes a deadline for responding to a request from Conseco for 

a written statement. . . . 

* * * 

78. The Court finds that there were no unreasonable delays in Fortune’s 

responses to Conseco’s requests for information concerning the Bish, Swank 

and Nelson issues, and that Fortune did not breach the [Agreement] by his 

response times.

79. In general a contract cannot be breached by actions or omissions 

occurring before the contract was executed and known to the parties to the 

contract at the time of contracting in the absence of representations or 

warranties concerning prior events or conduct.

80. Conseco’s and PMA’s claim that Fortune breached the 

[Agreement] by his actions prior to April 8, 2005 fails. The Defendant 

Conseco breached the contract herein when it declared its contract with 

Fortune terminated for cause.

* * *

87. A party who breaches a contract may not thereafter enforce the 

contract provisions against a non-breaching party. 

88. The [Agreement] at Section X(2)(d) contains a provision for 

forfeiture in the event of competition after termination. . . .

* * *

90. The record herein establishes that subsequent to April 8, 2005, 

[Fortune] did violate the provisions of Section X(2)(d) at least by having 

individuals reduce coverage under policies provided by Conseco and then 

replace that coverage with coverage provided by another insurance company 

under a policy [Fortune] sold the former Conseco insured. This activity clearly 

would have permitted Conseco to then declare the termination of [Fortune] as 

a termination for cause and to then use that termination for cause an an [sic] 

beginning point to claim forfeiture of earned by unpaid commissions. 

However, that is not the case before this Court because on the date Conseco 

would first have had that right, it had already breached its contract with 

Fortune. Fortune was thereafter no longer bound by the terms of the 

[Agreement] and is entitled to receive his compensation.

* * *

Id. at 17-37 (citations omitted) (emphasis in original). The trial court therefore entered 

judgment in favor of Fortune and against the Defendants on Fortune’s complaint, ordering 
13

Conseco to pay to Fortune all commission to which he was entitled. The Defendants now 

appeal the trial court’s judgment.

Discussion and Decision

I. Standard of Review

The trial court entered findings of fact and conclusions thereon pursuant to Trial Rule 

52(A) at the request of one of the parties, and thus, we apply a two-tiered standard of review: 

first, we determine whether the evidence supports the findings, and second, whether the 

findings support the judgment. Clokey v. Bosley Clokey, 956 N.E.2d 714, 718 (Ind. Ct. App. 

2011). We will reverse only if the findings or judgment are clearly erroneous. Fischer v. 

Heymann, 943 N.E.2d 896, 900 (Ind. Ct. App. 2011), trans. denied. “Findings of fact are 

clearly erroneous when the record lacks any evidence or reasonable inferences from the 

evidence to support them.” Id. (citation omitted). A judgment is clearly erroneous “if no 

evidence supports the findings, the findings fail to support the judgment, or if the trial court 

applies the incorrect legal standard.” Bowyer v. Indiana Dep’t of Natural Resources, 944 

N.E.2d 972, 984 (Ind. Ct. App. 2011). 

We do not reweigh the evidence, considering only the evidence favorable to the trial 

court’s judgment, and we do not assess the credibility of the witnesses. Id. However, we 

evaluate conclusions of law, such as the interpretation of contractual provisions, de novo. 

Rennaker v. Gleason, 913 N.E.2d 723, 729 (Ind. Ct. App. 2009). “In order to determine that 

a finding or conclusion is clearly erroneous, an appellate court’s review of the evidence must 

leave it with the firm conviction that a mistake has been made.” Bowyer, 944 N.E.2d at 984.
14

 Although the Defendants purport to appeal the trial court’s judgment because “many 

of the findings contained therein are clearly erroneous,” see Appellants’ Brief at 1 (Statement 

of Issues), the crux of the Defendants’ actual argument is that the judgment is clearly 

erroneous because the trial court incorrectly concluded as a matter of law that the Defendants 

breached the Agreement first when they terminated the Agreement for cause and that the 

forfeiture clause is unenforceable and not applicable to all of Fortune’s vested compensation. 

Our review of the record indicates the evidence supports the trial court’s findings, and we 

therefore review only the trial court’s conclusions of law based upon those findings.

II. Breach of the Agreement

The essential elements of a breach of contract action are 1) the existence of a contract, 

2) the defendant’s breach thereof, and 3) damages. Ruse v. Bleeke, 914 N.E.2d 1, 11 (Ind. 

Ct. App. 2009). The parties do not dispute the existence of a contract, and agree the 2004 

Agreement governs the relationship between them. Fortune alleged the Defendants 

committed a breach by terminating the Agreement for cause when no such cause existed and 

thereafter withholding his vested commissions, damaging him to the amount of the 

commissions owed. The Defendants contend Fortune breached the Agreement first and was 

thus rightfully terminated for cause. The trial court concluded that the Agreement did not 

apply to any policy issued before the agreement date; that Fortune did not breach the 

Agreement by his conduct prior to termination; and that the Defendants therefore breached 

the Agreement first when they terminated Fortune for cause.
15

The Defendants did not bear the burden of proof on this issue at trial and therefore 

they appeal from an adverse judgment. See Romine v. Gagle, 782 N.E.2d 369, 376 (Ind. Ct. 

App. 2003) (“[A]n adverse judgment is one that was entered against a party defending on a 

given question”), trans. denied. 

When a trial court enters findings of fact in favor of the party bearing the 

burden of proof, we will deem the findings to be clearly erroneous where they 

are not supported by substantial evidence of probative value. We will reverse 

the judgment even where we find substantial supporting evidence, if we have a 

definite and firm conviction that a mistake was made.

Kotsopoulos v. Peters Broadcast Eng’g, Inc., 962 N.E.2d 97, 105 (Ind. Ct. App. 2011).

Generally, the construction of the terms of a written contract is a question of law. 

Collins v. McKinney, 871 N.E.2d 363, 372 (Ind. Ct. App. 2007). The goal of contract 

interpretation is to ascertain and give effect to the parties’ intent as disclosed by the language 

used to express their rights and duties. Id. Where the terms of a contract are clear, the 

meaning of the contract is determined as a matter of law. Anderson v. Horizon Homes, Inc., 

644 N.E.2d 1281, 1290 (Ind. Ct. App. 1995), trans. denied.

The Agreement provides that it “applies to all Policies issued on or after the 

Agreement Date,” which is September 19, 2004. Appellants’ App. at 236. Although there 

was apparently a relationship between Fortune and Conseco Marketing prior to this date, the 

only evidence in the record regarding the terms of that relationship are a Representative 

Marketing Agreement dated August 31, 1998, between Fortune and Capitol American; a 

Sales Representative Agency Addendum signed by Fortune on January 17, 2000 but never 

signed by a representative of Conseco Marketing; and a signature page signed by Fortune on 
16

September 24, 2003, and signed by a representative of Conseco Marketing on February 9, 

2004. Exhibits Volume, Plaintiff’s Exhibit 1, Plaintiff’s Exhibit 2, and Plaintiff’s Exhibit 4. 

Capitol American was acquired by Conseco at some point after Fortune began selling Capitol 

American products and Fortune then began selling Conseco products, so the Capitol 

American agreement is not relevant. The Addendum, in addition to being unrelated to any 

agreement in the record, concerns “Sub-Producers” recruited by the agent. And the 

agreement to which the signature page applies is not included in the record, so the signature 

page proves nothing regarding the relationship of the parties at that time. Thus, even if 

relevant, the terms of the relationship between the parties prior to September 19, 2004, are 

unknown. 

The Agreement at issue also provides that it is the “sole and entire agreement between 

the parties.” The Defendants assert in their brief that the “plain language of the 2004 

[Agreement] proves that it was intended to supersede all previous agreements between the 

parties.” Appellants’ Brief at 24. Several provisions of the Agreement apply following the 

termination of the Agreement. See, e.g., Appellant’s App. at 239 (Section VIII.7., stating 

“Compensation payable under this Agreement will continue to be paid after the date of 

termination for business submitted by you prior to the effective date of such termination . . . 

.”); id. at 240 (Section X.2.d., stating “If you, while this Agreement is in force or within two 

years following its termination . . . .”); id. at 241 (Section XI., concerning non-waiver of 

rights and privileges under “the terms of this Agreement”). However, there is no provision 
17

incorporating the terms of previous agreements or reserving rights under those agreements.7 

And, even if there were such provisions, as noted above, we do not know the terms of the 

previous agreements. Thus, consistent with the terms of the Agreement itself and the 

Defendants’ concession, the relationship of the parties is governed solely by the terms of the 

September 19, 2004 Agreement.

The Agreement provides that it may be immediately terminated for cause for several 

specific reasons. The general bases upon which the Defendants purported to terminate the 

Agreement for cause were that Fortune failed to cooperate in investigations; failed to 

understand the terms and conditions of the policies he sold; failed to adhere to conductrelated rules; and failed to comply with the code of conduct by misrepresenting policy 

benefits, conditions, or limitations. See id. at 258 (April 29, 2005, termination letter). These 

bases could fall under the failure to perform any of the Agreement’s material 

obligations/failure to conform to the company’s rules and regulations provision or under the 

otherwise acting to materially prejudice the interest of the company provision, allowing 

termination for cause. See id. at 240 (Section X.2.a. and X.2.f., Termination for Cause). 

The specific conduct for which the Defendants stated they terminated the Agreement 

with Fortune for cause, however, relate to the three complaints they received within the term 

 

7

 In contrast, we note the Capital American agreement in the record provides that the effective date of 

the agreement is indicated therein; “[h]owever, if this Agreement replaces an existing Marketing Agreement 

between Capitol and the Representative, the effective date . . . is the effective date of the replaced Marketing 

Agreement.” Exhibit Vol., Plaintiff’s Ex. 1. 
18

of the Agreement. The Swank and Bish complaints were determined by Conseco to be 

without merit, and therefore cannot form the basis for terminating the Agreement for cause.8

 The Nelson complaint alleges that in January 2004, Fortune wrote the wrong 

birthdate for a customer on two applications, in one case making it appear she was eligible 

for a policy for which she was not actually eligible. As the trial court noted, Fortune’s

actions in taking the birthdate information from the agent call center, writing it on the 

application before visiting with the customer, and not specifically asking her if the birthdate 

was correct or otherwise drawing her attention to the information, was at least negligent. See

Appellant’s App. at 29 (finding number 64). However, the customer signed the application, 

affirming that the information contained therein was correct, there was evidence that Fortune 

had received incorrect information from the agent call center before, there was no evidence 

that Fortune intentionally changed the birthdate to defraud or prejudice Conseco or the 

customer, and all of this occurred prior to the effective date of the Agreement. There was 

also evidence that Conseco knew soon after the application was received and well in advance 

of the Agreement date that the birthdate on at least one of the policy applications taken in 

January 2004 was incorrect. The Defendants also alleged that sometime prior to September 

of 2004, Fortune was advised of four other instances in which a wrong birthdate was 

discovered on an application he had taken. Again, these policies were issued prior to the 

effective date of the Agreement, and almost immediately after these incidents were discussed 

with Fortune, Conseco Marketing entered into the instant Agreement with him. Because any 

misconduct by Fortune in his handling of these policies occurred prior to the effective date of 

 

8

 It is not clear when either of these policies was issued or when the conduct complained of occurred.
19

the Agreement, and because the Agreement does not specifically reserve any rights to 

Conseco for prior conduct, these are not sufficient reasons for terminating the Agreement for 

cause.

Finally, the Defendants alleged that Fortune failed to cooperate in the investigations of 

these complaints. Upon receiving the complaints, Conseco sent to Fortune a letter informing 

him of the complaint and requesting that he provide a detailed explanation in writing “within 

three (3) days of receipt of this letter.” See Exhibits Vol., Plaintiff’s Ex. 22 (forwarding the 

Bish complaint); Defendant’s Ex. 1041 (forwarding the Nelson complaint). Fortune 

responded to each inquiry. Although it is undisputed that he did not respond to the inquiries 

within three days after they were sent, Fortune was away from his home a great deal in 

selling policies for the Defendants – usually Monday through Thursday – and there is no 

evidence of when he actually received the letters. The Agreement, although providing that 

Fortune agrees to cooperate fully in any investigation, does not establish the parameters of 

“full cooperation.” There is no evidence that the timing of Fortune’s responses prejudiced 

the Defendants in any way. In fact, Conseco resolved the Bish complaint in Fortune’s favor 

without waiting for his response. The trial court found that Fortune’s responses were not 

unreasonably delayed, and we cannot say this finding is clearly erroneous.

At trial and on appeal, the Defendants also asserted that Fortune breached the 

Agreement by selling policies for other companies during the term of the Agreement without 

written authorization. Fortune admitted that he did so, asserting he had verbal authorization. 

See Transcript at 336. This was not, however, a basis given for terminating the Agreement 
20

at the time of termination, and cannot be relied upon after-the-fact in an attempt to justify an 

otherwise unjustified termination for cause. 

The Defendants were certainly entitled to terminate the Agreement pursuant to the 

thirty-day notice provision, but as the trial court found, Fortune’s conduct did not constitute a 

breach of this Agreement under the terms of Section X.2. that would warrant termination for 

cause and forfeiture of his rights to vested compensation. When the Defendants terminated 

Fortune for cause, declared his vested compensation forfeited, and ceased paying him 

commissions, they breached the Agreement,9and the trial court’s judgment in favor of 

Fortune on his complaint for breach of contract is not clearly erroneous.

Because we hold the Defendants breached the Agreement and had no cause to declare 

a forfeiture, we need not discuss the trial court’s findings and conclusions regarding whether 

the forfeiture clause is enforceable, and if so, to what extent.

Conclusion

The trial court’s judgment in favor of Fortune on his complaint for breach of contract 

is not clearly erroneous as the evidence supports the trial court’s finding that the Defendants 

breached the Agreement by terminating Fortune for cause when no cause existed and invoked 

the forfeiture clause to deny his vested compensation. The judgment of the trial court is 

affirmed.

 

9

 Therefore, any post-termination conduct by Fortune that might otherwise invoke the forfeiture clause 

also does not constitute a breach on his part. See Licocci v. Cardinal Assoc., Inc., 492 N.E.2d 48, 52 (Ind. Ct. 

App. 1986) (“A party first guilty of a material breach of contract may not maintain an action against the other 

party or seek to enforce the contract against the other party should that party subsequently breach the 

contract.”), trans. denied; see also Steve Silveus Ins., Inc. v. Goshert, 873 N.E.2d 165, 176 (Ind. Ct. App. 

2007) (noting that it is undisputed that the first party to materially breach an employment agreement cannot 

subsequently enforce a covenant not to compete in that same agreement).
21

Affirmed.

NAJAM, J., and VAIDIK, J., concur.