Opinion ID: 852525
Heading Depth: 2
Heading Rank: 1

Heading: Jurisdiction of Proceedings Supplemental over the Merits of an Assigned Claim

Text: I agree with the majority that a proceeding supplemental is not the proper forum to resolve the merits of an assigned claim. The majority did not advance its reasoning supporting this conclusion. I take this opportunity to do so because I believe some of the reasons for this conclusion are also relevant to the propriety of permitting State Farm to intervene in this case. The resolution of the merits of an assigned claim in proceedings supplemental is inconsistent with the statutory scheme governing proceedings supplemental. Before the adoption of the Indiana Trial Rules in 1970, it was well established that proceedings supplemental were filed as new and independent civil actions. Baker v. State ex rel. Mills, 109 Ind. 47, 52, 9 N.E. 711, 713 (1887); Burkett v. Holeman, 104 Ind. 6, 11-12, 3 N.E. 406, 409-10 (1885). Indiana Trial Rule 69(E) effected a substantial change in the law. The Civil Code Study Commission's comment on Trial Rule 69(E) reads in pertinent part: Rule 69(E) retains the basic statutes upon [proceedings supplemental] but introduces simpler pleadings and procedure. However, this rule makes some significant changes. For one thing, the court rendering judgment retains venue or jurisdiction over proceedings supplemental, contrary to prior law which fixed venue at the defendant's residence. Relief is allowed by motion, and the order to appear in proceedings supplemental is granted ex parte without hearing, thus clarifying present procedures. Necessarily, this means that the remedy is merely a continuation of the original action both in name and in cause number. Indiana Rules of Civil Procedure: Proposed Final Draft 262 (1968). In the years since Trial Rule 69(E) was adopted, Indiana courts have routinely held that proceedings supplemental are merely extensions of the underlying action, not separate and independent actions. See, e.g., Arend v. Etsler, 737 N.E.2d 1173, 1175 (Ind.Ct.App.2000); Citizens Nat'l Bank v. Harvey, 167 Ind.App. 582, 589, 339 N.E.2d 604, 608 (1976). Consequently, proceedings supplemental serve the limited purpose of determining whether an asset is in the judgment debtor's possession or subject to the judgment debtor's control and can be attached to satisfy the judgment. Kirk v. Monroe County Tire, 585 N.E.2d 1366, 1368 (Ind.Ct.App.1992). Proceedings supplemental to execution have historically been summary in nature and have facilitated the timely collection of unsatisfied judgments. Lewis v. Rex Metal Craft, Inc., 831 N.E.2d 812, 820 (Ind.Ct. App.2005). But proceedings supplemental have refused to serve as forums for hearing new and independent causes of action that the debtor may have against third parties. See First Bank of Whiting v. Sisters of Mercy Health Corp., 545 N.E.2d 1134, 1141 (Ind.Ct.App.1989), trans. denied (concluding that a proceeding supplemental is not an appropriate forum to try a judgment creditor's cause of action against a garnishee-defendant). Thus, once assignments of actions were made, there was nothing left for the proceedings supplemental court to do. Trial Rule 69(E) authorizes the court in proceedings supplemental to apply property to the judgment as provided in the statute. The statute authorizes the proceedings supplemental court to order any non-exempt property, income, or profits of the judgment debtor . . . to be applied to the satisfaction of the judgment. Ind.Code § 34-55-8-7(a) (2004). It does not purport to confer jurisdiction over the merits of the assigned claim. There are also practical reasons why the merits of an assigned claim should not be tried in proceedings supplemental. There is no jury in a proceeding supplemental, and one of the parties may be entitled to a jury on the merits of the claim. In this case, the merits of the judgment debtor's claim against State Farm are at least somewhat related to the claim that resulted in the judgment that the Estate seeks to execute. That is not always the case. For example, resolution of an unliquidated tort claim may entail a variety of issues inappropriate for the court that created the judgment. In addition, the claim may turn on witnesses or other evidence that are difficult or impossible to secure in the forum giving rise to the judgment. Perhaps more importantly, Trial Rule 69(E) contemplates expedited procedures that may be unfair to resolution of the merits on an unliquidated claim. To resolve these inherent tensions, either the claim will be tried in a truncated way or the proceeding supplemental will be converted into a full-blown trial. There is no reason to choose either of these undesirable alternatives. Requiring the matter to be tried as a freestanding independent lawsuit avoids both.