Court Opinion

ID: 3186404
Source: CourtListenerOpinion
Date Created: 2016-03-17 15:24:56.002809+00
Date Added: 2024-06-11T14:08:19.422965
License: Public Domain

FILED
                                                                            Mar 17 2016, 8:47 am

                                                                                CLERK
                                                                            Indiana Supreme Court
                                                                               Court of Appeals
                                                                                 and Tax Court

ATTORNEY FOR APPELLANT                                    ATTORNEYS FOR APPELLEE
Abbigail A. Rohmiller                                     R. Scott Hayes
Amy Noe Law                                               Joel E. Harvey
Richmond, Indiana                                         Hayes Copenhaver Crider Harvey,
                                                          LLP
                                                          New Castle, Indiana

                                           IN THE
    COURT OF APPEALS OF INDIANA

Jeffery Allen Ring,                                       March 17, 2016
Appellant-Respondent,                                     Court of Appeals Case No.
                                                          33A01-1507-DR-1024
        v.                                                Appeal from the Henry Circuit
                                                          Court
Kimberly S. Ring,                                         The Honorable Mary G. Willis,
Appellee-Petitioner.                                      Judge
                                                          Trial Court Cause No.
                                                          33C01-1210-DR-282

Riley, Judge.

Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016                           Page 1 of 12
                                    STATEMENT OF THE CASE

[1]   Appellant-Respondent, Jeffery A. Ring (Jeffery), appeals the trial court’s Order

      Appointing Commissioner to Operate and Sell Farm Real Estate to Satisfy

      Petitioner’s Judgment following its Decree of Dissolution of Marriage to

      Appellee-Petitioner, Kimberly S. Ring (Kimberly).

[2]   We affirm in part, and reverse in part.

                                                    ISSUES

[3]   Jeffery raises one issue on appeal, which we restate as follows:

      1) Whether the parties’ subsequent agreement to sell a small parcel of a farm

          was a permissible modification of the dissolution decree; and

      2) Whether the trial court’s appointment of a commissioner to operate and sell

          the farm following Jeffery’s non-compliance with the terms of the

          dissolution decree was an impermissible modification of the dissolution

          decree.

                           FACTS AND PROCEDURAL HISTORY

[4]   Jeffery and Kimberly were married in October 1991. During their marriage,

      they had two children, both of whom are emancipated. Jeffery was a farmer

      and Kimberly worked for the Union School Corporation. Jeffery farmed his

      own land as well as rented agricultural land. By the time the parties separated,

      they had acquired two parcels of farmland, one consisting of approximately 145

      acres (Parcel A) and one consisting of approximately 79 acres (Parcel B), silage,

      Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016   Page 2 of 12
      farming equipment, machinery, livestock, and other property. Parcel A was

      valued at $929,500, and Parcel B was valued at $471,600. Both parcels secured

      three loans with a total amount of approximately $170,000. 1 At the time of the

      separation, the total marital estate, after subtracting liabilities, had a value of

      $2,353,854.89.

[5]   On October 18, 2012, Kimberly filed a petition to dissolve the parties’ marriage.

      The trial court held a final dissolution hearing on November 19, 2014 and

      entered its Decree of Dissolution of Marriage on December 9, 2014. The trial

      court determined that an equal division of the marital estate between the parties

      was equitable and granted Jeffery possession of the marital home, Parcel A and

      Parcel B, and farming equipment. To realize the equitable distribution of the

      martial estate, the trial court ordered Jeffery to pay $1,140,825.45 to Kimberly

      under the following conditions:

               [Jeffery] has testified that he has made [an] effort to borrow funds
               and that he is able to borrow the sum of $400,000. The [trial
               court] directs him to do so immediately and directs [Kimberly] to
               cooperate by signing such documents as are necessary to enable
               [Jeffery] to borrow against [Parcel A and Parcel B]. In the event
               [Jeffery] is unable to borrow said sum, he is directed to borrow
               the maximum amount that he can borrow and to pay the same to
               [Kimberly] immediately. [Jeffery] shall have ninety (90) days
               from the date of this [D]ecree to complete the loan application

      1
       Jeffery admits to the total loan amount, but does not specify the distribution of it as to the parcels of land.
      (Ex. 2); (Transcript p. 35).

      Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016                             Page 3 of 12
               process. Upon receiving funds, they shall be paid over to
               [Kimberly] immediately.

               ***

               [After payment of $400,000 to Kimberly, the balance] shall be
               paid in full with interest at the rate of 5.5% per annum within ten
               (10) years of the date hereof with a minimum of $75,000 being
               paid each year on or before the anniversary of this Decree. The
               judgment shall be a lien on all real estate owned by [Jeffery]
               junior in priority only to the loan [Jeffery] has been directed to
               obtain in this paragraph.

      (Appellant’s App. pp. 51-52).

[6]   Shortly thereafter, Jeffery and the parties’ son borrowed $413,000 from a bank

      to purchase a farm for the son. The new loan was secured by Parcel A. Due to

      the new loan, Jeffery was unable to obtain $400,000 to satisfy the judgment.

[7]   On March 23, 2015, Kimberly filed a Citation for Contempt alleging that

      Jeffery had failed to comply with the trial court’s order to complete the loan

      application process within ninety days from the Decree of Dissolution of

      Marriage. 2 On May 18, 2015, Kimberly filed a Request for Orders to Enforce

      Decree of Dissolution of Marriage requesting the trial court to appoint a

      commissioner to sell the farms to satisfy the judgment. The trial court held a

      hearing on June 17, 2015, and, on June 30, 2015, the trial court entered its

      2
       There is no indication in the record that Jeffery was found in contempt for failing to complete the loan
      application.

      Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016                         Page 4 of 12
      order appointing Halderman Farm Management Service, Inc. (Commissioner)

      as a commissioner. The trial court authorized Commissioner to

              [U]se its best efforts to maximize the value of the farms and the
              farming operation to achieve satisfaction of the judgment held by
              [Kimberly].

              ***

              a. [T]ake possession and operate the two (2) farms . . . .

              b. [P]ay to the [c]ourt for the benefit of [Kimberly] all revenue
              generated by the farm operations over and above the costs
              expended to generate said revenue.

              c. [P]ay itself for services consistent with its usual and customary
              management fees.

              ***

              e. [S]ell so much of the farm real estate as Commissioner believes
              to be prudent to maximize the value of the said farm real estate . .
              ..

      (Appellant’s App. pp. 76-77).

[8]   On August 26, 2015, Kimberly filed another Citation for Contempt alleging

      that Jeffery made misleading representations to the trial court regarding his

      efforts to borrow the funds and that Jeffery failed to cooperate with

      Commissioner. On October 5, 2015, the trial court held a hearing on the

      citation. At the conclusion of the hearing, Jeffery and Kimberly agreed that
      Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016   Page 5 of 12
       Commissioner would sell Parcel B to satisfy the judgment and that the citation

       would remain pending. The trial court approved the parties’ agreement in its

       order on October 7, 2015.

[9]    Jeffery now appeals. Additional facts will be provided as necessary.

                                   DISCUSSION AND DECISION

                                           I. Permissible Modification

[10]   Jeffery’s appeal is centered on the trial court’s appointment of Commissioner.

       After filing the appeal, however, Jeffery and Kimberly agreed to sell Parcel B

       with the help of Commissioner to satisfy the judgment. Property distribution

       settlements approved as part of a dissolution may be modified only where both

       parties consent or where there is fraud, undue influence, or duress. Johnson v.

       Johnson, 920 N.E.2d 253, 258 (Ind. 2010); see also Marriage of Snow v.

       England, 862 N.E.2d 664, 668 (Ind. 2007) (as with other contracts, a division of

       property may only be modified according to the terms of the agreement, if the

       parties consent, or if fraud or duress occurs); Myers v. Myers, 560 N.E.2d 39, 42

       (Ind. 1990) (a property settlement agreement incorporated into a final

       dissolution decree and order may not be modified unless the agreement so

       provides or the parties subsequently consent). As such, following our review of

       the record, we conclude that the parties’ subsequent agreement to sell Parcel B

       approved by the trial court was a permissible post-dissolution modification of

       their property distribution settlement.

       Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016   Page 6 of 12
                                          II. Impermissible Modification

[11]   As to Parcel A, Jeffery argues that the appointment of Commissioner to operate

       and, if needed, sell the farms was an impermissible modification of the

       dissolution decree. Kimberly responds that it was not a modification but an

       enforcement remedy pursuant to Indiana Code section 31-15-7-10. 3

[12]   Recently, our supreme court provided a comprehensive analysis of the law

       concerning the post-dissolution modification of property distribution between

       former spouses in Ryan v. Ryan, 972 N.E.2d 359 (Ind. 2012). The Ryan court

       reviewed the language of Indiana Code sections 31-15-2-17(c) and -7-9.1 and

       reiterated that the legislature unambiguously prohibited the post-dissolution

       modification of property distribution agreements between former spouses,

       except in case of fraud or where both parties consent, because they are

       economic in nature—ordinary contracts—and as with other contracts, may only

       be modified according to their terms. Ryan, 972 N.E. at 361-63.

[13]   Jeffery specifically points to the language of the dissolution decree and asserts

       that he was only required “to complete the loan application process within

       ninety days” and, if he failed to obtain the loan, to “borrow the maximum

       amount that he [could] borrow.” (Appellant’s Br. p. 5). Jeffery insists that

       there was no obligation to seek an outside person to manage or sell the land to

       satisfy the judgment. Although a court has no authority to modify a property-

       3
         Kimberly does not allege that their original agreement incorporated into the dissolution decree was made
       fraudulently.

       Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016                       Page 7 of 12
       settlement agreement, it does not mean that a court has no authority to resolve

       a dispute over the interpretation of a settlement agreement or property-division

       order. Ryan, 972 N.E2d at 363. When a party asks a court to clarify a

       settlement agreement, the court’s task is one of contract interpretation. Id. This

       is because settlement agreements are contractual in nature and binding if

       approved by the trial court. Id. As such, a settlement agreement is interpreted

       according to the general rules for contract construction. Id. at 364. That is,

       unless the terms of the contract are ambiguous, they will be given their plain

       and ordinary meaning. Id. Clear and unambiguous terms in the contract are

       deemed conclusive, and when they are present we will not construe the contract

       or look to extrinsic evidence but will merely apply the contractual provisions.

       Id. As this dispute requires us to interpret the decree of dissolution, our

       standard of review is de novo. See, e.g., Bd. of Comm’rs of Cnty. of Jefferson v. Teton

       Corp., 30 N.E.3d 711, 713 (Ind. 2015).

[14]   In Ryan, the parties agreed to sell two properties they owned and divide the

       proceeds, subject to a proviso that neither party was required to accept a sale

       yielding net proceeds below specified minimums. Ryan, 972 N.E.2d at 360.

       After almost 20 months on the market, the parties were unable to sell their

       properties, so the former husband moved the trial court to order the properties

       to be sold at the prevailing fair market value. Id. at 361. The trial court denied

       the motion and, on appeal, our supreme court affirmed. Id. at 371. The Ryan

       court found that there was “no ambiguity in the language of the parties’

       agreement that would permit [the court] to conclude as a matter of contract law

       Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016     Page 8 of 12
       that [the former wife was] bound to agree to sales prices for the properties …

       less than those stated in the agreement.” Id. at 364-65. Even though, the

       former husband was trying to label his request as a clarification, in fact, it was a

       request to modify the original agreement. Id. at 365.

[15]   Here, similarly, the language of the parties’ agreement was unambiguous.

       According to the dissolution decree, Jeffery was required to submit his loan

       application, and if denied, try again. There was no language requiring the

       parties to sell the land to satisfy the judgment in their original agreement.

[16]   Kimberly, in turn, maintains that Jeffery’s assertion was a

       “mischaracterization” of the trial court’s order. (Appellee’s Br. p. 6). The trial

       court’s appointment of Commissioner, she continues, was an enforcement

       remedy consistent with the appointment of a receiver, which was a permitted

       method of enforcing an order issued in a dissolution proceeding. To support

       her argument, Kimberly cites to Gore v. Gore, 527 N.E.2d 191, 198 (Ind. Ct.

       App. 1988).

[17]   In Gore, the former husband operated a pub. Id. at 192. After finding the

       former husband in contempt three times for violating the order restraining him

       from disposing of potential marital assets, the trial court appointed a receiver

       over the pub. Id. On appeal, the Gore court reversed the imposition of the

       receivership over the pub because there was no evidence presented to show that

       the receivership was necessary to secure ample justice to the parties. Id. at 199.

       Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016   Page 9 of 12
       “[A] receivership [over a business operation] is a dangerous remedy which

       could injure rather than protect the marital estate.” Id.

               The appointment of a receiver is essentially a prerogative of
               equity, which may be exercised as a means of conserving the
               property or assets for the benefit of all parties in interest. The
               court will be authorized to appoint a receiver if it appears that,
               through fraud, mismanagement, misconduct, or otherwise, there
               is a likelihood that the property will be squandered, wasted,
               misappropriated or unlawfully diverted without the
               court’s intervention. But, absent threatened destruction or
               dissipation of the property, or where there is no good cause to
               believe that benefit would result from the appointment of a
               receiver, then the court should decline to make such an
               appointment. The power to appoint a receiver is a delicate one
               which is reluctantly exercised by the courts. The power to act
               rests very largely within the sound discretion of the court. A
               receiver should be appointed only when the court is satisfied that
               the appointment will promote the interests of one or both parties,
               that it will prevent manifest wrong, imminently impending, and
               that the injury resulting will not be greater than the injury sought
               to be averted.

       Id. at 196-97 (citations omitted).

[18]   We find the Gore court’s decision instructive. The evidence and circumstances

       of the present case, similarly, do not warrant the imposition of the receivership

       over Jeffery’s farm. There was no evidence presented to show that Jeffery was

       mishandling his farming operation. Conversely, the record reveals that Jeffery

       was farming the land even after the appointment of Commissioner. There was

       no evidence presented to show that Jeffery lacked experience or ability to farm.

       In fact, farming was his and his family’s livelihood for generations. Jeffery did

       Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016   Page 10 of 12
       not do anything wrong with his farm to warrant the court’s intervention. His

       alleged refusal to cooperate with Commissioner and an attempt to make himself

       less attractive to the lending institutions have nothing to do with the successful

       handling of his farm, which is the crux of the receivership law. See, e.g.,

       Tormohlen v. Tormohlen, 1 N.E.2d 596 (Ind. 1936) (held that a receivership was

       not warranted over a large chicken hatchery because a farmer left trusted

       persons to handle the farm to prevent waste before fleeing the state to escape

       the dissolution court’s jurisdiction).

[19]   Accordingly, because the language of the dissolution decree was unambiguous,

       we conclude that the trial court’s appointment of Commissioner to operate and,

       if needed, sell Parcel A was an impermissible modification of the original terms

       between the parties because it went beyond Jeffery’s obligation to attempt to

       obtain a loan to satisfy the judgment. Also, we reverse the appointment of

       Commissioner as to Parcel A because no evidence was presented to show that

       Jeffery was likely to mismanage, waste, misappropriate, or otherwise harm his

       farm which could have warranted the court’s intervention and would have been

       necessary to secure ample justice to the parties. Finally, we reiterate that this

       decision is limited to Parcel A because Jeffery and Kimberly had successfully

       modified their property dissolution agreement as to Parcel B by subsequently

       agreeing to sell Parcel B with the help of Commissioner.

       Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016   Page 11 of 12
                                                CONCLUSION

[20]   Based on the foregoing, we hold that the parties’ subsequent agreement to sell

       Parcel B was a permissible modification of their original marital property

       disposition settlement, and, as to Parcel A, the trial court’s appointment of

       Commissioner without Jeffery’s consent and without assertion of fraud was an

       impermissible modification of the parties’ original agreement.

[21]   Affirmed in part, and reversed in part.

[22]   Najam, J. and May, J. concur

       Court of Appeals of Indiana | Opinion 33A01-1507-DR-1024 | March 17, 2016   Page 12 of 12