Source: https://www.in.gov/judiciary/opinions/previous/archive/06309904.smb.html
Timestamp: 2019-04-24 16:15:00+00:00

Document:
STEPHEN M. TERRELL WILLIAM T. HOPKINS, JR.
Brazauskas raises three primary issues and numerous secondary issues for review, which we combine and restate as whether the trial court erred in granting defendants' first, third, and fourth motions for summary judgment.
This contract is for a one year period. Upon completion of the contract period a new contract will be signed. If either party does not wish to renew the contract, notice in writing shall be given at least 90 days before the existing contract expires.
The PARISH agrees that the DRE shall not be discharged without good and sufficient cause. The PARISH further agrees that the person to whom the DRE is accountable will be responsible for giving the DRE notice, wherever possible, of any dissatisfaction with service or conduct. Moreover, if the DRE is dismissed or the contract terminated, due process procedures shall be followed.
This contract is for a [t]hree year period. Upon completion of the contract period a new contract will be signed. If either party does not wish to renew the contract, notice in writing shall be given at least 30 days before the existing contract expires.
In accordance with Parish policy, the performance of the P.A. shall be reviewed and evaluated after six months of employment and again after two years of employment.
The PARISH agrees that the P.A. shall not be discharged without good and sufficient cause. The PARISH further agrees that the person to whom the P.A. is accountable will be responsible for giving notice, wherever possible, of any dissatisfaction with service or conduct. Moreover, if the P.A. is dismissed or the contract terminated, due process procedures shall be followed.
On or about July 1, 1990, Brazauskas allegedly executed a second three-year contract with the parish that was to run through June 30, 1993 ("1990 contract").See footnote 3 The 1990 contract allegedly contained the same or similar provisions regarding dismissal as the 1987 contract. On June 28, 1992, Martelli replaced Simmons as the parish pastor. Brazauskas left for vacation on or about June 30, 1992, and returned on August 1, 1992. On August 6, 1992, Martelli met with Brazauskas and gave her the choice of either resigning or being fired from her position. Martelli fired Brazauskas on August 7, 1992. The circumstances surrounding Brazauskas' firing are vigorously disputed by the parties. Brazauskas alleges that Martelli's stated reasons for firing her were "that she intimidated him, that they could not get along, and that he did not like working with her"; defendants claim that she was fired for her "expression of unorthodox theological views and conduct offensive to Church teachings."
remarks" about her and had "implied that there was something of a bad and sinister nature" about her, "thereby causing her irreparable harm, injury, and damages and rendering her sick, stressed, and physically debilitated." Brazauskas specifically asserted claims against defendants for breach of contract; fraud; promissory estoppel; breach of the covenant of good faith and fair dealing; tortious interference with business relationship; defamation; and intentional infliction of emotional distress.
Defendants filed an answer to the amended complaint on September 7, 1993, in which they denied Brazauskas' allegations and raised nine affirmative defenses. Defendants asserted, inter alia, that the trial court lacked subject-matter jurisdiction to hear Brazauskas' claims; that any statements made by defendants were privileged; that her claims were barred by the applicable statutes of limitation; that she had waived any right she may have had to bring her stated claims; and that she had "failed to pursue and exhaust her internal and/or administrative remedies."
her primary duties had been "religious and clerical," her claims were "all inextricably linked to the circumstances of her termination" as an ecclesiastical matter that could not be considered by the trial court. Defendants also contended that Brazauskas would be able to appeal her termination within the Catholic Church ("Church") pursuant to canon law, and that she had been aware of this remedy.
Brazauskas filed a memorandum in opposition to defendants' first motion for summary judgment on September 28, 1993. She argued that "no doctrinal issue [was] at stake" in her case that would prevent a trial court from addressing her claims; she further claimed that "defendants [had] gone to extraordinary lengths to misconstrue this matter as an ecclesiastical dispute whereas in reality it is clearly a breach of contract action together with other causes of action which civil courts are clearly able to resolve."
Defendants filed their third motion for summary judgment on February 23, 1995, asserting that the trial court lacked subject-matter jurisdiction to hear Brazauskas' defamation claim on First Amendment grounds; they argued that an examination of defendants' alleged defamatory statements would "require an evaluation of [Brazauskas'] action in an ecclesiastical light and [could not] be examined without . . . reference to church teachings and governance." Defendants also asserted that the statements were protected by a qualified privilege of common interest; that they did not harm Brazauskas' reputation or deter third persons "from dealing or associating with her"; and that she had consented to their publication.
Brazauskas filed a brief in opposition to defendants' third motion for summary judgment on October 6, 1995. She argued that defendants did not have an absolute privilege under the First Amendment to defame her, and that their freedom for religious action "remain[ed] subject to regulation for the protection of society." Brazauskas also attacked defendants' assertions of qualified privilege and of her consent to the publication of the alleged defamatory statements. The trial court granted defendants' third motion for summary judgment without comment on December 5, 1997.
On October 15, 1996, Brazauskas amended her complaint for fraud, constructive fraud, and equitable estoppel. With respect to her fraud claim, she asserted that the diocese had knowingly and intentionally misrepresented her employment contract as binding and enforceable in civil court, and that she had detrimentally relied on this misrepresentation. As to the constructive fraud claim, she maintained that defendants "stood in a special confidential and fiduciary relationship" with her as a member of the parish in the diocese "and by virtue of the special and confidential relationship" between her and Simmons, Bishop John D'Arcy, and other diocesan officials. She claimed that these special relationships, in conjunction with their alleged fraudulent actions, constituted constructive fraud. Brazauskas also asserted that she had relied on defendants' acts of alleged fraud and constructive fraud with respect to her employment contract, and that defendants were therefore estopped from denying the enforceability of the contract.
Defendants filed their answer to Brazauskas' amended complaint on October 24, 1996, denying her allegations and raising seven affirmative defenses. They filed their fourth motion for summary judgment with respect to the fraud, constructive fraud, and equitable estoppel claims on May 2, 1997. Defendants asserted that the trial court lacked subject- matter jurisdiction to hear these claims because of First Amendment constraints. They also argued that her fraud claims were barred by the statute of limitations; that Brazauskas could not prove all the elements of either a fraud of constructive fraud claim; and that she could not establish a claim of equitable estoppel. The trial court granted defendant's fourth motion for summary judgment without comment on December 5, 1997.
On March 20, 1998, Brazauskas filed a renewed motion for the trial court's entry of final judgment as to its orders granting defendants' first, third, and fourth motions for summary judgment pursuant to T.R. 54(B).See footnote 7 The trial court granted this motion on April 23, 1998. Brazauskas then filed a praecipe to initiate this appeal.
A trial court's ruling on a motion for summary judgment comes before this Court clothed with a presumption of validity. Harvest Life Ins. Co. v. Getche, 701 N.E.2d 871, 874 (Ind. Ct. App. 1998), trans. denied (1999). As the party appealing the grant of summary judgment, Brazauskas bears the burden of persuading us that the trial court erred. Id. "When reviewing a grant of summary judgment, we use the same standard as applied by the trial court." Id. "Summary judgment should be granted only when there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law." Id.; Ind. Trial Rule 56(C).
judgment "on the ground that there is a genuine issue of material fact unless material facts and relevant evidence were specifically designated to the trial court." Brunner v. Trustees of Purdue University, 702 N.E.2d 759, 760 (Ind. Ct. App. 1998); Ind. Trial Rule 56(H). "Summary judgment should not be used as an abbreviated trial." Id.
In granting defendants' first motion for summary judgment for lack of subject-matter jurisdiction, the trial court drafted a three-page memorandum that outlines the reasoning behind its decision. We may not rely on any findings of fact and conclusions of law entered by a trial court on a motion for summary judgment, but must instead base our decision on the materials properly presented to the trial court. Harvest Life Ins. Co., 701 N.E.2d at 874. Consequently, we "will affirm a grant of summary judgment if it is sustainable on any theory or basis found in the record." Id.
Id. "When a court lacks subject matter jurisdiction, any action it takes is void." Perry, 637 N.E.2d at 1286. The lack of subject-matter jurisdiction can be raised at any time, and either the trial court or the Court of Appeals is required to consider the issue sua sponte if it is not questioned by the parties. Albright, 637 N.E.2d at 1363. We will therefore treat defendants' first motion for summary judgment as a motion to dismiss for lack of subject-matter jurisdiction under T.R. 12(B)(1). See Walters v. Modern Aluminum, 699 N.E.2d 671, 673 (Ind. Ct. App. 1998), trans. denied (worker's compensation case).
637 N.E.2d at 1286-1287. This Court will affirm the trial court's judgment "on any theory supported by the evidence of record." Walters, 699 N.E.2d at 673.
It is worth noting that Indiana appellate courts have decided relatively few cases regarding a trial court's ability to adjudicate employment-related disputes involving religious organizations; it is therefore not surprising that both parties rely heavily on decisions from other state tribunals and from the federal bench. Before we may engage in a First Amendment analysis of Brazauskas' breach of contract claim, however, we must confirm the presence of its three essential elements: "the existence of a contract, the defendant's breach thereof, and damages." Holloway v. Bob Evans Farms, Inc., 695 N.E.2d 991, 995 (Ind. Ct. App. 1998).
from summary judgment; plaintiff's breach of contract claim "without substance as there is no such contract in the record" or attached to the complaint as required by T.R. 9.2(A)); cf. Wilson v. Palmer, 452 N.E.2d 426, 430 (Ind. Ct. App. 1983) (trial court erred in failing to comply with T.R. 9.2(F); court should have ordered plaintiff to attach instrument to complaint or held a hearing to dismiss pursuant to Ind. Trial Rule 41(E) instead of summarily dismissing claim).
980, 983-984 (Ind. 1982) (necessity of holding a hearing before dismissal); see also Chesterfield Management, Inc. v. Cook, 655 N.E.2d 98, 101 (Ind. Ct. App. 1995), trans. denied (1996) (documents outside the record cannot be considered by this Court on appeal or used by party to support its arguments). Consequently, we need not address the parties' arguments on this issue regarding the First Amendment and subject-matter jurisdiction.
Defendants' initial argument in their third motion for summary judgment concerned the trial court's lack of subject-matter jurisdiction to hear Brazauskas' defamation claim under the First Amendment. We have observed that the proper procedural vehicle for claiming lack of subject-matter jurisdiction is a motion to dismiss under T.R. 12(B)(1). See Albright, 637 N.E.2d at 1363. Defendants also argued that the alleged defamatory statements were protected by a qualified privilege of common interest; that these statements did not harm Brazauskas' reputation or "deter third persons from dealing or associating with her"; and that she had consented to the publication of these statements.
of prayer in various parish celebrations and functions"; and assuming responsibility for "various types of sacramental programs," "[t]he training and function of liturgical ministers," and "[t]he catechumenate and Rite of Christian Initiation of Adults." Regardless of whether she may be considered a member of the Roman Catholic clergy--a question disputed at various points in the record--Brazauskas clearly was responsible for developing, implementing, and supervising various ecclesiastical programs for the parish.
the allegedly defamatory statements and attempts to show that the statements either do or do not involve questions of religious doctrine that may or may not be considered by a trial court.
The First Amendment, applicable to the states through the Fourteenth amendment, contains two freedoms with respect to religion: the freedom to believe and the freedom to act. Cantwell v. Connecticut, 310 U.S. 296, 303, 60 S.Ct. 900, 903, 84 L.Ed. 1213 (1940). The freedom to believe is absolute, while the freedom to act is subject to regulation for the protection of society. Id. at 303-04, 60 S.Ct. at 903-04. . . .
Excessive entanglement [between church and state] occurs when the courts begin to review and interpret a church's constitution, laws, and regulations. Serbian Eastern Orthodox Diocese v. Milivojevich, 426 U.S. 696, 709-10, 96 S.Ct. 2372, 2380-81, 49 L.Ed.2d 151 (1976), reh. denied, 429 U.S. 873, 97 S.Ct. 191, 50 L.Ed.2d 155 (1976). The First Amendment prohibits courts from resolving doctrinal disputes or determining whether a religious organization acted in accordance with its canons and bylaws. Id. at 713, 96 S.Ct. at 2382..
The United States Supreme Court has instructed that the First Amendment does not prohibit courts from opening their doors to religious organizations [footnote omitted]. Presbyterian Church in the United States v. Mary Elizabeth Blue Hull Memorial Presbyterian Church, 393 U.S. 440, 449, 89 S.Ct. 601, 606, 21 L.Ed.2d 658 (1969). Instead, a court can apply neutral principles of law to churches without violating the First Amendment. Id. The First Amendment only prohibits the court from determining underlying questions of religious doctrine and practice. Id.
Applying this analysis to tort claims against religious organizations, several courts have determined that when purely secular conduct is at issue, courts can apply secular standards and hold churches responsible for the effects of their conduct on third parties.
It is important to note that the "neutral principles of law" approach as enunciated in Presbyterian Church and further developed in Jones v. Wolf, 443 U.S. 595, 99 S.Ct. 3020, 61 L.Ed.2d 775 (1979) has been applied only to disputes involving church property, although the United States Supreme Court noted in Serbian that the necessity of deciding church disputes without inquiring into doctrinal issues "applies with equal force to church disputes over church polity and church administration." 426 U.S. at 710, 99 S.Ct. at 2381, 49 L.Ed.2d at 163. In Konkle, we held that the defendant's alleged acts of sexual molestation "were not religiously motivated," and that the court was "simply applying secular standards to secular conduct which is permissible under First Amendment standards." 672 N.E.2d at 456.
In the instant case, Brazauskas argues that defendants' alleged statements constitute a "defamation of character, pure and simple, to be decided by 'neutral principles of law'"; conversely, defendants claim that the "First Amendment prevents civil courts from exercising jurisdiction over claims related to the employment of church employees whose duties are primarily religious." We note that the initial determination of whether a communication is defamatory is a question of law for the trial court, and that the communication must be viewed "in context and given its plain and natural meaning, 'according to the idea [it is] calculated to convey to whom [it is] addressed.'" Rambo v. Cohen, 587 N.E.2d 140, 145 (Ind. Ct. App. 1992), trans. denied, quoting Jacobs v. City of Columbus, 454 N.E.2d 1253, 1264 (Ind. Ct. App. 1983). "Moreover, the allegedly defamatory words are to be construed in light of the circumstances of their utterance." Rambo, 587 N.E.2d at 145.
When the conduct complained of occurs in the context of, or is germane to, a dispute over the plaintiff's fitness or suitability to enter into or remain a part of the clergy, however, it is difficult to see how the forbidden inquiry could be avoided. Questions of truth, falsity, malice, and the various privileges that exist often take on a different hue when examined in the light of religious precepts and procedures that generally permeate controversies over who is fit to represent and speak for the church.
Downs v. Roman Catholic Archbishop of Baltimore, 111 Md. App. 616, 624, 683 A.2d 808, 812 (Md. Ct. Spec. App. 1996) (former candidate for priesthood brought defamation suit against members of church hierarchy).
the possible interpretations of defendants' statements and their purported reasons for uttering them; to conclude otherwise would effectively thrust this Court into the forbidden role of arbiter of a strictly ecclesiastical dispute over the suitability of a pastoral employee to perform her designated responsibilities.
In their fourth motion for summary judgment, defendants asserted that the trial court did not have subject-matter jurisdiction to decide Brazauskas' claims for fraud, constructive fraud, and equitable estoppel. As stated above, defendants should have challenged the trial court's subject-matter jurisdiction through a motion to dismiss under T.R. 12(B)(1). See Albright, 637 N.E.2d at 1363. Defendants also attacked these claims on substantive grounds, and the trial court granted the summary judgment motion without comment. However, we need not address the merits of Brazauskas' arguments on appeal because her fraud and estoppel claims are inextricably linked to her breach of contract claim. Because we have held that the breach of contract claim must fail, the fraud and estoppel claims likewise cannot succeed.
"To sustain an action for fraud, the plaintiff must prove that the defendant made a material misrepresentation of a past or existing fact, which was false, was made with knowledge or in reckless ignorance of the falsity," was relied upon by the plaintiff, and proximately caused the plaintiff's injury. First Bank of Whiting v. Schuyler, 692 N.E.2d 1370, 1372 (Ind. Ct. App. 1998), trans. denied. Brazauskas' fraud claim was based upon the defendants' "knowing and intentional misrepresentation" of the enforceability of her written employment contract; without proof that the contract at issue ever existed, we may not inquire into defendants' alleged misrepresentations or Brazauskas' reliance on them.
The essential elements of constructive fraud are (1) a duty existing because of the relationship between the parties; (2) "representations or omissions made in violation of that duty"; (3) "reliance thereon by the complaining party"; (4) "injury to the complaining party as a proximate result thereof"; and (5) the gaining of an advantage by the defendant at the expense of the plaintiff. Wells v. Stone City Bank, 691 N.E.2d 1246, 1250-1251 (Ind. Ct. App. 1998), trans. denied. Again, the defendants' representations of which Brazauskas complains relate to the enforceability of her employment contract.
To support a claim for equitable estoppel, a plaintiff must prove "(1) a representation or concealment of a material fact, (2) made by a person with knowledge of the fact and with the intention that the other party act upon it, (3) to a party ignorant of the fact, (4) which induces the other party to rely or act upon it to his detriment." Wabash Grain, Inc. v. Smith, 700 N.E.2d 234, 237 (Ind. Ct. App. 1998). Here, as above, the representation relates to the enforceability of Brazauskas' employment contract.
Because there are no genuine issues of material fact with respect to at least one essential element of each of Brazauskas' claims of fraud, constructive fraud, and equitable estoppel, we affirm the trial court's grant of defendant's fourth motion for summary judgment. See Colen v. Pride Vending Service, 654 N.E.2d 1159, 1162 (Ind. Ct. App. 1995), trans. denied (1996) ("a defendant is entitled to judgment as matter of law when undisputed material facts negate at least one element of plaintiff's claim"); Harvest Life Ins. Co., 701 N.E.2d at 875 (grant of summary judgment may be affirmed "if it is sustainable on any theory or basis found in the record").
The trial court's orders for summary judgment are vacated with respect to defendants' first and third motions and affirmed with respect to their fourth motion, and this case is remanded for further proceedings consistent with the instructions contained in this opinion.
Affirmed in part, vacated in part, and remanded with instructions.
STATON and RILEY, JJ., concur.
Footnote: 1 In her reply brief, Brazauskas takes issue with appellees' apparent "effort to circumvent this Court's page limitation [by placing] extended arguments and discussion of cases in single-spaced footnotes." This contention is well taken, and appellees are encouraged to refrain from engaging in this practice in the future.
Footnote: 2 We note that the contract was not signed by either Brazauskas or any parish representative.
Footnote: 3 The 1990 contract does not appear in the record. Brazauskas clearly insinuates that Martelli was involved in the disappearance of both her copy and the parish's copy of the contract; in their brief, defendants merely refer to the 1990 contract as "alleged."
Footnote: 4 The chronological case summary merely notes that an order on defendant's motion to dismiss was entered on July 12, 1993; neither the motion nor the order is included in the record.
Footnote: 5 The First Amendment to the United States Constitution reads in relevant part as follows: "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof."
Footnote: 6 Brazauskas filed a "motion to vacate and/or set aside" the trial court's order granting defendants' first motion for summary judgment on July 31, 1995; the chronological case summary notes that this motion was denied on October 31, 1995. She also filed a "motion to vacate and/or set aside" the trial court's order "to conform with [a] recent Indiana Court of Appeals decision" on May 1, 1997, which was denied by the trial court on December 5, 1997. The decision to which Brazauskas referred is Konkle v. Henson, 672 N.E.2d 450 (Ind. Ct. App. 1996).
A summary judgment upon less than all the issues involved in a claim or with respect to less than all the claims or parties shall be interlocutory unless the court in writing expressly determines that there is not just reason for delay and in writing expressly directs entry of judgment as to less than all the issues, claims or parties.
Footnote: 8 In her memorandum opposing defendant's summary judgment motion, Brazauskas questioned this procedural error in passing but did not attack it with any supporting authority. We also note that defendants raised the issue of subject-matter jurisdiction as an affirmative defense to Brazauskas' amended complaint.
Footnote: 9 Omitted citations are hereinafter indicated by "[.]" for legibility purposes.
Whenever there has been a failure to comply with these rules or when no action has been taken in a civil case for a period of sixty  days, the court, on motion of a party or on its own motion shall order a hearing for the purpose of dismissing such case. The court shall enter an order of dismissal at plaintiff's costs if the plaintiff shall not show sufficient cause at or before such hearing.
us, we may not consider the merits of Brazauskas' breach of contract claim. We also note that merely by assuming that the 1990 contract existed for purposes of summary judgment, defendants cannot be said to have acknowledged its existence for all other purposes. Finally, we note that with respect to defendants' first motion for summary judgment, Brazauskas appealed only on her breach of contract claim and did not appeal on her claims for fraud, promissory estoppel, breach of the covenant of good faith and fair dealing, and intentional infliction of emotional distress.
Footnote: 12 With respect to this statement, perhaps the one most obviously susceptible to a defamatory interpretation, defendants assert that Martelli meant he was unable to trust Brazauskas with the religious education of young children. Without considering the validity of this interpretation, we merely note that it is at least nominally supported in the depositions of parishioners Susana M. Cahill and Sally M. Vance- Trembath, both of whom were present at the meeting where Martelli made this statement.
Footnote: 13 T.R. 41(B) reads in relevant part: "[A]ny dismissal not provided for in this rule, other than a dismissal for lack of jurisdiction, operates as an adjudication upon the merits."

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