Court Opinion

ID: 4217250
Source: CourtListenerOpinion
Date Created: 2017-11-02 15:10:09.021184+00
Date Added: 2024-06-11T13:26:24.520212
License: Public Domain

MEMORANDUM DECISION
                                                                            FILED
Pursuant to Ind. Appellate Rule 65(D),                                 Nov 02 2017, 9:02 am
this Memorandum Decision shall not be
regarded as precedent or cited before any                                   CLERK
                                                                        Indiana Supreme Court
                                                                           Court of Appeals
court except for the purpose of establishing                                 and Tax Court

the defense of res judicata, collateral
estoppel, or the law of the case.

ATTORNEY FOR APPELLANT                                  ATTORNEY FOR APPELLEE
Caroline B. Briggs                                      DANIEL DUMOULIN, SR.
Lafayette, Indiana                                      Cassandra A. Kruse
                                                        Emswiller, Williams, Noland &
                                                        Clarke, P.C.
                                                        Indianapolis, Indiana

                                          IN THE
    COURT OF APPEALS OF INDIANA

Daniel Dumoulin II,                                     November 2, 2017
Appellant-Intervenor,                                   Court of Appeals Case No.
                                                        52A02-1704-DR-725
        v.                                              Appeal from the Miami Superior
                                                        Court
Daniel Dumoulin, Sr.,                                   The Honorable A. Christopher
Appellee-Petitioner,                                    Lee, Special Judge
                                                        Trial Court Cause No.
and
                                                        52D02-0901-DR-11
Joan Dumoulin,
Appellee-Respondent

Baker, Judge.

Court of Appeals of Indiana | Memorandum Decision 52A02-1704-DR-725 | November 2, 2017          Page 1 of 10
[1]   Daniel Dumoulin II (Son) appeals the trial court’s order denying his motion to

      dismiss the proceedings supplemental action filed by Daniel Dumoulin, Sr.

      (Husband), to collect on a debt owed by Son. In 2005, Son purchased a bar

      owned by Husband and Joan Dumoulin (Wife), for a purchase price of $2.1

      million. The balance still owed on that debt is approximately $1.1 million. As

      part of the divorce proceeding between Husband and Wife (in which Son is an

      intervening party), the trial court entered an order finding that Son must make

      respective payments of approximately $550,000 to each of his parents. Son

      appealed that order and, in 2016, this Court affirmed.

[2]   After we affirmed that order, Husband filed a proceedings supplemental to

      collect on Son’s debt. Son appeals, arguing that it was a limited liability

      company (LLC), rather than Son individually, that purchased the bar, and that

      the correct way to collect on this debt is to bring a mortgage foreclosure action

      rather than a proceedings supplemental. Finding that Son is barred from raising

      these arguments because he did not do so when he appealed from the money

      judgment order, we affirm.

                                                    Facts
[3]   Husband and Wife married in 1971 and had four children, including Son. At

      some point, Husband and Wife were members of Hoosier LLC, which owned a

      sports bar in Kokomo called Ultimate Place 2B (the bar). In 2005, Husband

      and Wife agreed to sell the bar to Son. The parties made an oral agreement,

      and the bar was either transferred to Son individually or to Ultimate Place

      Court of Appeals of Indiana | Memorandum Decision 52A02-1704-DR-725 | November 2, 2017   Page 2 of 10
      LLC, of which he was a member. Son or Ultimate Place LLC agreed to pay

      $2.1 million for the bar, some of which would be covered by payment of his

      preexisting debts to his parents. Dumoulin v. Dumoulin, No. 52A05-1505-DR-

      500, at *3 (Ind. Ct. App. June 10, 2016) (“Dumoulin III”).

[4]   After Son took over the operations of the bar, he converted it into an adult

      entertainment business. Its liquor license then came up for renewal. After the

      Alcohol and Tobacco Commission denied his petition to renew the license, Son

      sought judicial review; the trial court reversed the denial of his petition. This

      Court affirmed the trial court and found, among other things, that Son agreed

      to pay $2.1 million for the bar and that the transaction was bona fide. Ind.

      Alcohol & Tobacco Comm’n v. Ultimate Place, LLC, No. 34A05-0804-CV-209, at *6

      (Ind. Ct. App. Sept. 30, 2008) (“Dumoulin I”).

[5]   On January 30, 2009, Husband filed a petition to dissolve the marriage. In

      April 2012, Wife filed a motion to add Son as an indispensable party to the

      dissolution proceedings and to bifurcate the final hearing, conducting a separate

      hearing solely to determine the marital estate. The trial court granted Wife’s

      motion and Son intervened in the proceeding.

[6]   In January 2013, all parties participated in mediation, but they were not

      successful in resolving issues surrounding the bar. On January 28, 2013, the

      trial court held a hearing regarding the remaining property disputes in the

      marital estate. It distilled the issues before it as follows: “the sole issue[s] in this

      hearing are four adjacent properties [unrelated to this appeal] and ownership of

      Court of Appeals of Indiana | Memorandum Decision 52A02-1704-DR-725 | November 2, 2017   Page 3 of 10
the “Ultimate Place 2B[”] which is presently owned by a Limited Liability

Company, [“]Ultimate Place LLC.[”] Appellant’s App. p. 42. On April 9,

2013, the trial court issued an order (the April 2013 Order) regarding these

property disputes. In relevant part, it held as follows:

        3.      The [bar] owned by Ultimate Place LLC is located at 5126
                Clinton, Kokomo, IN. The sales member of the LLC is
                [Son], the intervener. The husband and wife disclaimed
                any interest in said business and property in numerous
                proceedings which eventually was decided in [the] 2008
                unpublished decision cited as [Dumoulin I]. [Husband]
                admitted that the parties so testified, [h]owever, there was
                no writing setting forth the terms of an oral agreement.

        4.      There was an oral partially performed agreement for
                payment and ownership between the intervener and his
                parents. The husband disputes the price and the terms and
                conditions. However, the husband and wife each agree
                that many bills, mortgages and other indebtedness have
                been paid and that the intervener is not in default. The
                husband claims there was and is equity in the
                transaction[.] However, he presents no [credible] evidence
                of value and relies solely upon his understanding of price
                which was disputed by the wife and intervener. Evidence
                was presented that the building and business were worth
                less than the parties[’] indebtedness pledged or mortgaged
                to the payment of debt at the time of the transfer to
                intervener.

        5.      The [bar] property is presently titled to another LLC
                named Hoosier LLC which has been administratively
                dissolved by the Indiana Secretary of State. Once the
                administrative dissolution takes place the LLC members
                are required to wind up the business, which they

Court of Appeals of Indiana | Memorandum Decision 52A02-1704-DR-725 | November 2, 2017   Page 4 of 10
                      accomplished when the sports bar business was transferred
                      to the Gentlemen’s Club. However, the deeds and other[]
                      transfer documents will need to be executed at the
                      completion of the oral and partially performed contract
                      stated above.

                                                      ***

              10.     The court declares that there is no equity . . . in [the bar]
                      and [it] is not a marital asset. In this connection the title to
                      real estate is vested in Hoosier LLC which is a dissolved
                      entity. Therefore the remaining act of winding up business
                      is the transfer of real estate at the time when all payments
                      pursuant to the oral contract are completed. . . . The court
                      finds the parties have no interest in the real estate except
                      the intervener[’s] promise to pay and their conveyance.

      Id. at 43-45. The trial judge recused himself on May 8, 2013; a special judge

      was later appointed to oversee the proceedings.

[7]   On May 8, 2013, Husband filed a motion to correct error regarding the April

      2013 Order. In relevant part, he argued that the Statute of Frauds prevented

      Son from enforcing the oral contract regarding the bar, that he had not

      disclaimed his interest in the bar during the Dumoulin I proceedings, and that

      the value of the oral contract should not be excluded from the marital estate.

      On October 22, 2013, the trial court denied Husband’s motion as it related to

      the bar.

[8]   On December 10, 2014, the trial court held the second of the bifurcated final

      hearings. At the conclusion of the hearing, the trial court granted the

      Court of Appeals of Indiana | Memorandum Decision 52A02-1704-DR-725 | November 2, 2017   Page 5 of 10
       dissolution of marriage, entered the dissolution decree, and took all pending

       issues under advisement. Dumoulin III, at *3. On April 30, 2015, the trial court

       issued an order (the Money Judgment Order) requiring Son to make payments

       of approximately $581,000 to each parent. In relevant part, the trial court

       found as follows:

                It is undisputed that [Son] agreed to purchase the [bar] from his
                parents. [Wife and Son] argue that the agreement was for [Son]
                to assume certain debts and it is clear that [Son] has paid on
                those debts. [Father] . . . concedes that part of that purchase
                price included the debts that [Son] has paid thus far, leaving a
                balance of $1,162,009.08. This Court cannot ignore the prior
                sworn testimony of [Father] and [Son] that the purchase price
                was 2.1 million dollars. . . .

       Id. at 90.

[9]    Two appeals ensued. First, Wife appealed the division of the marital estate,

       raising arguments unrelated to this appeal. Dumoulin v. Dumoulin, No. 52A05-

       1507-DR-823 (Ind. Ct. App. May 13, 2016) (“Dumoulin II”). We affirmed. Id.

       at *7.

[10]   In Dumoulin III, Son appealed the Money Judgment Order and Husband cross-

       appealed the denial of his motion to correct error regarding the April 2013

       Order. This Court summarized Son’s arguments in that case as follows:

                (1) he argues that the trial court lacked the authority to determine
                whether he owed monies to Husband and Wife because Son was
                never put on notice that either Husband or Wife was seeking a
                monetary judgment against him; (2) the trial court lacked subject

       Court of Appeals of Indiana | Memorandum Decision 52A02-1704-DR-725 | November 2, 2017   Page 6 of 10
               matter jurisdiction because the issue was not ripe for review; (3)
               the Statute of Frauds bars Husband and Wife’s recovery on the
               agreement to purchase the Ultimate; and (4) the trial court
               abused its discretion by refusing to admit Exhibit J.

       Dumoulin III, at *1. Son did not argue that the Money Judgment Order was

       erroneous based on the alleged fact that an LLC, rather than Son as an

       individual, was the purchaser/owner of the bar, nor did he argue that the

       judgment should have been fashioned as an in rem, rather than an in personam,

       judgment. Father did not argue that the April 2013 Order was erroneous based

       on the trial court’s conclusion in that order that Ultimate Place LLC, rather

       than Son as an individual, was the purchaser of the bar. Son argued that the

       doctrine of res judicata applied to the April 2013 Order but this Court

       disagreed, noting that “the April 2013 Order was not a final appealable order.”

       Id. at *4 n.3. This Court affirmed in all respects. Id. at *7.

[11]   After Dumoulin III was decided, Father filed a motion to enforce the judgment

       by proceedings supplemental1 on October 12, 2016. Son moved to dismiss that

       motion, arguing that mortgage foreclosure, rather than proceedings

       supplemental, was the appropriate remedy for default on a land contract and

       that collection should be made against the Ultimate Place LLC rather than Son

       as an individual. Following a hearing, the trial court denied Son’s motion on

       1
        Proceedings supplemental “are designed as a remedy where a party fails to pay a money judgment. The
       proceedings are merely a continuation of the underlying claim, initiated under the same cause number for the
       sole purpose of enforcing a judgment.” Prime Mortg. USA, Inc. v. Nichols, 885 N.E.2d 628, 668-69 (Ind. Ct.
       App. 2008) (internal citation omitted).

       Court of Appeals of Indiana | Memorandum Decision 52A02-1704-DR-725 | November 2, 2017          Page 7 of 10
       March 3, 2017, finding that (1) the Money Judgment Order was appealed and

       affirmed; and (2) the Money Judgment Order is not an in rem judgment and is

       instead a “general judgment” in favor of Husband and against Son. Appellant’s

       App. p. 36. Son now appeals.

                                    Discussion and Decision
[12]   Son raises the following arguments on appeal: (1) Husband is bound by the

       trial court’s finding in the April 2013 Order that Ultimate Place LLC, rather

       than Son individually, was the purchaser of the bar; (2) Husband may not

       proceed individually against Son without piercing the corporate veil, and there

       has been no request to do so; and (3) even if it was proper to proceed against

       Son as an individual, proceedings supplemental was not the correct method to

       do so—instead, it should have been filed as a mortgage foreclosure action.

[13]   With respect to Son’s argument that the Money Judgment Order should have

       been entered against Ultimate Place LLC, rather than Son as an individual, the

       proper time in which to make this argument would have been the Dumoulin III

       appeal, which was a direct appeal of that order. But of all the arguments he

       raised in that appeal with respect to the Money Judgment Order, he did not

       raise the one he argues now. And unfortunately for Son, he may not take an

       untimely second bite at the apple. We can only conclude that he is barred from

       Court of Appeals of Indiana | Memorandum Decision 52A02-1704-DR-725 | November 2, 2017   Page 8 of 10
       making this argument at this point in the litigation.2 Consequently, we decline

       to reverse based on the fact that the Proceedings Supplemental Order was

       entered against Son individually rather than against Ultimate Place LLC.

[14]   Now, we must consider Son’s final argument—that the proper way in which to

       enforce the Money Judgment is via a mortgage foreclosure rather than

       proceedings supplemental. Here, yet again, we are compelled to find that he is

       not entitled to raise this issue. The Money Judgment Order clearly and plainly

       enters a money judgment “in favor of [Father] and against [Son] in the amount

       of $581,004.54. The judgment will not accrue interest from the date of this

       order through 2017. Commencing on January 1, 2018, any unpaid balance on

       the judgment shall accrue interest at the legal rate.” Appellant’s App. p. 90.

[15]   An “in personam” debt means that the creditors may “seek to collect against

       the debtor individually[.]” McCullough v. CitiMortgage, Inc., 70 N.E.3d 820, 827

       (Ind. 2017). An “in rem” debt, on the other hand, is merely a “right[] against

       the property” at issue. Id. at 828. In this case, the Money Judgment Order

       clearly finds an in personam debt (which may be collected upon via proceedings

       supplemental) rather than an in rem debt (which, perhaps, should be collected

       upon via a mortgage foreclosure action). If Son wanted to appeal the way in

       which the trial court imposed and fashioned this debt, the proper time to do so

       2
        Son argues that Husband is barred by the doctrine of res judicata from arguing that the April 2013 Order,
       which found that Ultimate Place LLC purchased the bar, was erroneous. We cannot reach the merits of this
       argument, however, as it should have been raised in Dumoulin III, and may not be raised at this time.

       Court of Appeals of Indiana | Memorandum Decision 52A02-1704-DR-725 | November 2, 2017         Page 9 of 10
       would have been in Dumoulin III, when he appealed from the Money Judgment

       Order. Yet again, he must be denied an untimely second bite of this apple. As

       such, we decline to reverse.

[16]   The judgment of the trial court is affirmed.

       Bailey, J., and Altice, J., concur.

       Court of Appeals of Indiana | Memorandum Decision 52A02-1704-DR-725 | November 2, 2017   Page 10 of 10