Court Opinion

ID: 2807441
Source: CourtListenerOpinion
Date Created: 2015-06-11 15:05:56.971347+00
Date Added: 2024-06-11T12:40:46.528385
License: Public Domain

Jun 11 2015, 8:44 am

ATTORNEYS FOR APPELLANTS                                     ATTORNEY FOR APPELLEE
Edward P. Grimmer                                            Kevin E. Steele
Daniel A. Gohdes                                             Burke Costanza & Carberry, LLP
Edward P. Grimmer, P.C.                                      Valparaiso, Indiana
Crown Point, Indiana

                                            IN THE
    COURT OF APPEALS OF INDIANA

Michael R. Bixeman and                                      June 11, 2015
Doreen Bixeman,                                             Court of Appeals Case No.
                                                            45A03-1411-PL-406
Appellants/Plaintiffs/Cross-Appellees,
                                                            Appeal from the Lake Superior
        v.                                                  Court;
                                                            The Honorable Diane Kavadias
                                                            Schneider, Judge;
Hunter’s Run Homeowners                                     45D11-1305-PL-43
Association of St. John, Inc.,
Appellee/Defendant/Cross-Appellant.

May, Judge.

Court of Appeals of Indiana | Opinion 45A03-1411-PL-406 | June 11, 2015                     Page 1 of 9
[1]   Michael R. Bixeman and Doreen Bixeman (“Bixemans”) appeal the court’s

      declaration as moot their allegation of slander of title by Hunter’s Run

      Homeowners Association of St. John, Inc. (“Hunter’s Run”). Hunter’s Run

      cross-appeals the court’s determination the sanction Hunter’s Run imposed

      against Bixemans was invalid.

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

                              Facts and Procedural History
[3]   Bixemans own a residence in the Hunter’s Run Subdivision that is encumbered

      by a Declaration of Covenants, Conditions, Restrictions and Easements

      (“Declaration”). Article XI, Section 8 of the Declaration requires owners who

      wish to rent their residence to others to provide leases in writing and to rent the

      residence for at least six months initially and for not less than thirty days

      thereafter. Section 6 of the Rules and Regulations 1 states owners must provide

      a copy of the lease to Hunter’s Run at least fifteen days prior to the effective

      date of the lease. It also provides the lease must contain a clause that obligates

      the prospective tenant to acknowledge receipt of the Declaration.

[4]   In 2012, Bixemans moved to Iowa. On October 7, 2012, Bixemans rented their

      residence to another party, effective October 1, 2012. Bixemans did not provide

      the lease to Hunter’s Run fifteen days prior to its effective date, and the lease

      1
       The Rules and Regulations are a document amended and adopted by Hunter’s Run on February 28, 2012,
      “in furtherance of the powers, authorities and restrictions upon use contained within the Declaration of
      Covenants.” (App. at 65.)

      Court of Appeals of Indiana | Opinion 45A03-1411-PL-406 | June 11, 2015                        Page 2 of 9
      did not contain a clause requiring the tenants’ acknowledgement of receipt of

      the Declaration.

[5]   The Declaration Article XII, in pertinent part, states:

              The Board of Directors shall not impose a Special Assessment as a
              sanction, suspend the right to vote, or infringe upon any other rights of
              an Owner or Occupant for any such violations unless and until the
              following procedure is followed:
              1. Demand. Written demand to cease and desist from an alleged
                 violation shall be served upon the alleged violator specifying: (a)
                 the alleged violation; (b) the action required to abate the violation;
                 and (c) a time period, not less than ten (10) days, during which the
                 violation may be abated without further action.
              2. Notice. If the violation continues past the period allowed in the
                 demand for abatement without sanction, the Association shall
                 serve the violator with written notice of the hearing. The notice
                 shall contain: (a) the nature of the alleged violation; (b) the time
                 and place of the hearing, which time shall not be less than ten (10)
                 days from the giving of the notice; (c) and invitation to attend the
                 hearing and produce any statements, evidence and/or witnesses in
                 his/her behalf; and (d) the proposed sanction to be imposed.
              3. Hearing. The hearing shall be held in executive session by the
                 Board of Directors pursuant to the notice affording the violator a
                 reasonable opportunity to be heard. Prior to the effectiveness of
                 any sanction hereunder, proof of notice, the invitation to be heard,
                 the written result and statements of the sanction shall be placed in
                 the minutes of the meeting. Such proof shall be deemed adequate
                 if a copy of notice together with a statement of the date and
                 manner of delivery is entered by the officer or director who
                 delivered such notice. The notice requirement shall be deemed
                 satisfied if a violator appears at the meeting.
      (Appellant’s App. at 51-52.)

[6]   On October 22, 2012, Hunter’s Run notified Bixemans of their violation and of

      a Homeowner’s Association hearing to be held on October 29, 2012. Bixemans
      Court of Appeals of Indiana | Opinion 45A03-1411-PL-406 | June 11, 2015             Page 3 of 9
      were unable to travel from Iowa for the hearing, and Hunter’s Run would not

      allow them to appear by telephone. Hunter’s Run made no decision at the

      hearing and requested Bixemans submit any evidence in writing. Hunter’s Run

      did not receive a response it considered adequate, and on December 13, 2012, it

      imposed a $250.00 sanction on Bixemans. Bixemans did not pay, and Hunter’s

      Run recorded a $2,525.00 lien against the Bixemans’ property. Bixemans were

      notified of the lien by a Notice of Lien tendered to them on February 18, 2013.

[7]   Bixemans sued for release of the lien. Hunter’s Run counter-sued to enforce

      and foreclose the lien. Bixemans filed a partial motion for summary judgment

      requesting the court find invalid the lien that slandered their title and find in

      their favor on all counterclaim issues. Hunter’s Run moved for declaratory

      judgment and foreclosure of its lien.

[8]   The trial court entered summary judgment, ordering Bixemans to pay the

      $250.00 sanction and ordering Hunter’s Run to release the invalid lien; in

      ordering the lien released, the court declared that “[d]ue to the invalidity of the

      lien, Plaintiff’s allegation for slander of title is moot.” (App. at 14.) After

      Bixemans filed a motion to correct error, the trial court declared the sanction

      invalid and reversed the order Bixemans pay it, but it reaffirmed its findings as

      to the slander of title.

                                  Discussion and Decision
[9]   A trial court has broad discretion in ruling on a motion to correct error.

      Volunteers of Am. v. Premier Auto Acceptance Corp., 755 N.E.2d 656, 658 (Ind. Ct.

      Court of Appeals of Indiana | Opinion 45A03-1411-PL-406 | June 11, 2015      Page 4 of 9
       App. 2001). We will reverse only for an abuse of that discretion. Id. An abuse

       of discretion occurs if the decision was against the logic and effect of the facts

       and circumstances before the court or if the court misapplied the law. Id.

[10]   The propriety of a decision on a motion to correct error after a summary

       judgment depends on the validity of the decision to grant or deny summary

       judgment. We review summary judgment de novo, applying the same standard

       as the trial court. Hughley v. State, 15 N.E.3d 1000, 1003 (Ind. 2014). Drawing

       all reasonable inferences in favor of the non-moving party, we will find

       summary judgment appropriate if the designated evidence shows there is no

       genuine issue as to any material fact and the moving party is entitled to

       judgment as a matter of law. Id. A fact is material if its resolution would affect

       the outcome of the case, and an issue is genuine if a trier of fact is required to

       resolve the parties’ differing accounts of the truth, or if the undisputed material

       facts support conflicting reasonable inferences. Id.

[11]   The initial burden is on the summary-judgment movant to demonstrate there is

       no genuine issue of fact as to a determinative issue, at which point the burden

       shifts to the non-movant to come forward with evidence showing there is an

       issue for the trier of fact. Id. While the non-moving party has the burden on

       appeal of persuading us a summary judgment was erroneous, we carefully

       assess the trial court’s decision to ensure the non-movant was not improperly

       denied his day in court. Id.

       Court of Appeals of Indiana | Opinion 45A03-1411-PL-406 | June 11, 2015     Page 5 of 9
                                                     Sanction

[12]   The trial court did not err when it declared the sanction invalid, as Hunter’s

       Run did not follow the procedures agreed upon in the Declaration. The

       Declaration is tantamount to a contract. See Villas W. II of Willowridge

       Homeowners Ass’n, Inc. v. McGlothin, 885 N.E.2d 1274, 1278 (Ind. 2008) (“A

       restrictive covenant is an express contract between grantor and grantee that

       restrains the grantee’s use of his land.”).

[13]   Hunter’s Run concedes it did not follow the “due process” 2 specified in

       Declaration Article XII, as the notice given to the Bixemans occurred only

       seven days before the hearing and meeting minutes were not preserved for the

       record. It, therefore, asserts its substantial compliance should absolve it of any

       requirement to follow the process for sanctions outlined in the Declaration. 3 It

       does not.

[14]   Hunter’s Run relies on Gibson v. Neu, 867 N.E.2d 188, 195 (Ind. Ct. App. 2007),

       which declared there is substantial compliance only if “performance of a

       nonessential condition is lacking, so that the benefits received by a party are far

       2
        The court was referring not to the constitutional right, but rather to a right to the process outlined in the
       Declaration.
       3
        Hunter’s Run also asserts it should be excused for its failure to follow the process for sanctions because it
       acted “upon advice of counsel.” (Appellee’s Br. at 9.) Indiana Appellate Rule 46(A)(8)(a) requires each
       contention be supported by cogent reasoning and “supported by citations to the authorities, statutes, and the
       Appendix or parts of the Record on Appeal relied on.” As Hunter’s Run has not cited any authority in
       support of its assertion, this argument is waived.

       Court of Appeals of Indiana | Opinion 45A03-1411-PL-406 | June 11, 2015                                Page 6 of 9
       greater than the injury done to him by the breach of the other party.” Id.

       (quoting Dove v. Rose Acre Farms, Inc., 434 N.E.2d 931 (Ind. Ct. App. 1982)).

[15]   We decline to hold the requirement to wait ten days after giving notice was a

       “nonessential condition.” All parties acknowledge Bixemans were unable to be

       at the meeting with only seven days’ notice. Hunter’s Run willingly agreed to

       the process of assessing sanctions that included ten days’ notice. If it did not

       want to or was unable to follow the process, it could have declined to assess the

       sanctions. However, if it wished to impose the sanctions, it was obliged to

       follow the process outlined in the covenants to which it and the homeowners,

       including the Bixemans, had agreed. See, e.g., Drenter v. Duitz, 883 N.E.2d 1194,

       1203 (Ind. App. 2008) (If homeowner wished to build shed, it needed to first

       obtain approval of plans in accordance with Subdivision’s restrictive

       covenants.). As Hunter’s Run did not follow that process, the trial court did

       not err when it declared the sanction invalid.

                                                Slander of Title4

[16]   To demonstrate slander of title, one must prove “false statements were made,

       with malice, and that the plaintiff sustained pecuniary loss as a necessary and

       4
         In its conclusions of law the trial court said “[d]ue to the invalidity of the lien, [Bixemans’] allegation for
       [sic] slander of title is moot.” (App. at 14.) Immediately afterward in its judgment order it ruled on the
       slander of title allegation, determining “[t]he liability of Defendant Hunter’s Run for its slander of title is
       DENIED.” (Id. at 15.) In its Order upon Motion to Correct Errors it stated it “reaffirms its findings,
       conclusions, and order of April 9, 2014 with respect to [Bixemans’] claim for slander of title.” (Id. at 10.)
        A “moot” question is one “involving no subject matter upon which the court’s judgment might operate.”
       State v. Vore, 268 Ind. 340, 342, 375 N.E.2d 205, 207 (1978). Despite its statement the allegation of slander of

       Court of Appeals of Indiana | Opinion 45A03-1411-PL-406 | June 11, 2015                                  Page 7 of 9
       proximate consequence of the slanderous statements.” Display Fixtures Co., a

       Div. of Stein Indus. v. R. L. Hatcher, Inc., 438 N.E.2d 26, 30 (Ind. Ct. App. 1982).

       A malicious statement is one “made with knowledge of [its] falsity or with

       reckless disregard for whether [it is] false.” Holland v. Steele, 961 N.E.2d 516,

       525 (Ind. Ct. App. 2012), trans. denied.

[17]   Hunter’s Run was notified by Bixeman’s attorney that the lien was invalid, yet

       it refused to release the lien. That demonstrated malice. See Walsh & Kelly, Inc.

       v. Int’l Contractors, Inc., 943 N.E.2d 394, 399-400 (Ind. Ct. App. 2011) (refusal to

       release lien after repeated notifications lien was invalid constituted malice),

       trans. denied. Bixemans were unable to market their property and had to pay

       their attorney in order to put this matter to rest, which resulted in pecuniary

       loss. See Keilbach v. McCullough, 669 N.E.2d 1052, 1053 n.2 (Ind. Ct. App.

       1996) (approval of “attorney fees as the proper measure of damages” in slander

       of title actions). Having maliciously placed a lien on Bixemans’ property,

       which lien Bixemans allege caused them pecuniary loss, Hunter’s Run

       committed slander of title. 5 See, e.g., Walsh & Kelly, Inc., 943 N.E.2d at 400

       title was moot, it appears the trial court did in fact enter judgment on that question in Hunter’s Run’s favor.
       We accordingly address whether that ruling was error.
       5
         As explained above, we agree with the trial court that the lien was invalid, and the designated evidence
       shows there is no genuine issue as to whether Hunter’s Run committed slander of title. However, the trial
       court erred when it determined Bixemans’ “allegation for slander of title is moot” because the lien was
       invalid. See, e.g., Huff v. Jennings, 459 S.E.2d 886, 890 (S.C. Ct. App. 1995) (discharging lien did not
       “extinguish any claim for slander of title” and slander of title claim was “not rendered moot by . . . discharge
       [of] lien.”), reh’g denied, appeal dismissed.

       Court of Appeals of Indiana | Opinion 45A03-1411-PL-406 | June 11, 2015                              Page 8 of 9
       (though court declared lien invalid, party maliciously asserting lien still liable

       for slander of title).

[18]   We accordingly direct the trial court to enter summary judgment for Bixemans

       on their slander of title claim and remand for a determination whether

       Bixemans were damaged by that slander of title and if so, to what extent.

                                               Attorney Fees

       Bixemans assert Hunter’s Run slander of title entitled them to attorney fees

       pursuant to Ind. Code § 32-20-5-2. Hunter’s Run does not dispute Bixemans’

       assertion except to note the court made no finding. We accordingly instruct the

       court on remand to enter findings regarding attorney fees.

                                              Conclusion
[19]   As Hunter’s Run did not follow the process agreed to in the Declaration, the

       sanctions were invalid. However, Bixemans demonstrated slander of title by

       Hunter’s Run invalid lien. Thus, we reverse and remand for the trial court to

       determine Bixemans’ damages, including attorney fees.

[20]   We affirm in part, reverse in part, and remand.

       Robb, J., and Mathias, J., concur.

       Court of Appeals of Indiana | Opinion 45A03-1411-PL-406 | June 11, 2015     Page 9 of 9