Court Opinion

ID: 4278959
Source: CourtListenerOpinion
Date Created: 2018-05-29 15:06:06.98693+00
Date Added: 2024-06-11T14:34:32.606081
License: Public Domain

MEMORANDUM DECISION
      Pursuant to Ind. Appellate Rule 65(D),                                         FILED
      this Memorandum Decision shall not be
                                                                             May 29 2018, 10:20 am
      regarded as precedent or cited before any
      court except for the purpose of establishing                                   CLERK
                                                                                 Indiana Supreme Court
      the defense of res judicata, collateral                                       Court of Appeals
                                                                                      and Tax Court
      estoppel, or the law of the case.

      ATTORNEYS FOR APPELLANT                                 ATTORNEY FOR APPELLEE
      Kathleen A. DeLaney                                     Russell T. Clarke, Jr.
      Annavieve C. Conklin                                    Emswiller Williams Noland &
      DeLaney & DeLaney, LLC                                  Clarke, P.C.
      Indianapolis, Indiana                                   Indianapolis, Indiana

                                                IN THE
          COURT OF APPEALS OF INDIANA

      Larry Martin,                                           May 29, 2018
      Appellant,                                              Court of Appeals Case No.
                                                              18A-MI-25
              v.                                              Appeal from the Porter Superior
                                                              Court
      Gino Burelli,                                           The Honorable Jeffrey W. Clymer,
      Appellee.                                               Judge
                                                              Trial Court Cause No.
                                                              64D02-1507-MI-6414

      Barnes, Judge.

                                            Case Summary
[1]   Larry Martin appeals the trial court’s grant of a motion for preliminary

      injunction to Gino Burelli. We remand.

      Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018                           Page 1 of 12
                                                    Issue
[2]   Martin raises one issue, which we restate as whether the trial court properly

      granted a motion for preliminary injunction to Burelli.

                                                    Facts
[3]   Burelli, Dominico Idoni, and Kevin MacKay are owners of a rare Briggs

      Cunningham Corvette that is valued at several million dollars. Burelli and

      Idoni each owned thirty-five percent of the vehicle, and MacKay owned the

      remaining thirty percent. The vehicle is currently located in Indiana.

[4]   In June 2009, Martin obtained a judgment in Maryland against Idoni for

      $250,600 plus ten percent interest per annum. In July 2015, Martin filed a

      notice of filing a foreign judgment in Indiana and a praecipe for writ of

      attachment and order for execution of the judgment. Martin alleged that Idoni

      had a thirty-five percent ownership interest in the vehicle that was sufficient to

      satisfy the judgment. The trial court entered a writ of attachment and order for

      execution of the judgment and ordered the Porter County Sheriff’s Department

      to seize the vehicle.

[5]   Burelli filed a motion to intervene in the action, which the trial court granted.

      Burelli also filed a motion to vacate the writ of attachment and order for

      execution of judgment. Burelli alleged that he held an insurance policy on the

      vehicle with Zurich Insurance and that a condition of the policy was that the

      vehicle remain in Burelli’s care, custody, and control. Burelli requested that the

      vehicle be returned to his possession to avoid cancellation of the insurance

      Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018    Page 2 of 12
      policy. Burelli also argued that the vehicle should not be sold because Idoni

      owned only a minority interest in the vehicle. After a hearing, the trial court

      ordered that the vehicle be returned to Burelli’s care “during the pendency of

      this action or until further order of the Court.” Appellant’s App. Vol. II p. 79.

      The trial court also found that a lien existed on the vehicle in the amount of

      Martin’s judgment. Finally, the trial court ordered Burelli to provide a report to

      Martin and the court on January 1, 2016, and quarterly after that date regarding

      “[g]ood faith efforts to restore, market and sell such vehicle and report of

      vehicle location.” Id. at 80. The trial court noted that Martin had the right to

      apply for further relief if the vehicle was not sold by August 2017. Burelli filed

      reports in January 2016, April 2016, July 2016, October 2016, January 2017,

      and May 2017.

[6]   On September 18, 2017, Martin filed a verified motion for proceedings

      supplemental. He alleged that, with interest, he was now owed almost

      $430,000 and that Idoni had not satisfied the judgment. He also asserted that

      Burelli had filed late reports, failed to file a July 2017 report, failed to sell the

      vehicle, and failed to satisfy the lien. Burelli responded by filing a “Verified

      Motion for Temporary Restraining Order and Permanent Injunction.” Id. at

      145. Burelli asserted in his motion that, in September 2017, Idoni conveyed his

      interest in the vehicle to Burelli to satisfy a debt of more than $1,376,699 and

      that Burelli now controlled seventy percent ownership of the vehicle. Martin

      then filed a petition for contempt and sanctions against Burelli.

      Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018      Page 3 of 12
[7]   At a hearing on the motions, Burelli testified that he had retained a broker to

      sell the vehicle and that he would like until August 2018 to complete a sale.

      The broker also testified at the hearing. At the end of the hearing, the trial

      court stated:

              With respect to finding that the intervenor is in bad faith, the
              Court makes these findings: The Court -- the car is currently in
              the possession of either Top Flight Corvettes or Gino Burelli or
              Harbor. It is currently insured. It’s insured through Zurich’s
              policy with Harbor, so, therefore, as long as the car is still within
              Harbor’s possession, it’s part of the overall Zurich floor plan
              policy. One small concern that the Court has, which may
              address premiums with Harbor, is that to some extent perhaps
              the lienholders would be loss payees on this particular car, but I
              don’t even know who it’s titled to. It’s titled to someone’s name
              in Florida. But the Court makes these findings: That the car is
              currently in possession of Harbor which is pursuant to the
              August 7, 2015, order and the car is insured. The Court finds
              that there were quarterly reports that were made, although they
              were not made timely. The car is currently -- it appears to be safe
              and the car is currently insured. It appears that there’s currently
              a contract -- a brokerage contract with Mr. Goldsborough which
              has a sliding scale. . . . The motion for bad faith and contempt is
              denied. The -- what I would like to do is clean up the record in
              such a way that it makes it easiest to sell the car because selling
              the car and getting the most money for the sale of the car benefits
              Mr. Goldsborough, benefits Mr. MacKay, benefits Mr. Burelli,
              and whenever it’s sold, benefits the judgment, plaintiff, creditor.
              And the sooner that that happens, the better, and the sooner it
              benefits the judgment of the plaintiff.

              To the extent that the Court has heard evidence that says that
              that cloud that exists over the title, I don’t know if there’s
              anything that the Court can do to clean up that cloud in that it

      Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018    Page 4 of 12
        appears right now that there are lienholders that are Larry
        Martin, judgment creditor, Mr. MacKay, and Mr. Burelli as
        some part owners of the vehicle. Given what Mr. Goldsborough
        has said, that he would satisfy those liens including Mr. Martin’s
        lien before making distributions ultimately to Mr. Burelli which
        is the normal course of business with car assignment and car
        liens. So I ruled on the motion regarding contempt.

        I ruled on the affidavit and striking the affidavit. I’ve sort of half
        ruled on the temporary restraining order. So what I want you to
        do, Mr. Bush, is submit an order that grants in part the
        temporary restraining order. What I want to do is I want to issue
        an order so if somebody looked at the court file, they’ll see that
        the title is as clean as can possibly be.

        Now, to address some other additional issues: The Court is not
        going to order that this be sold at the Barrett-Jackson auction in
        January. The Court finds that the obligation to make quarterly
        reports under the August 7, 2015, order continues to exist. The
        car is to remain in the possession of Harbor insured by
        Harbor/Top Flight Corvettes/Mr. Burelli until it’s sold. The
        August 7, 2015, order said that the car should be sold. It did not
        say what would happen if it was not sold. The Court’s convinced
        given what I’ve heard today that a forced sale, whether it’s a
        sheriff sale in Porter County or sale at Barrett-Jackson, would not
        necessarily return the greatest amount of money although it
        would return the soonest amount of money, and I don’t believe
        that’s fair to Mr. Burelli.

                                             *****

        What they asked for -- you asked that this be sold at Barrett-
        Jackson in Scottsdale in January. That request is denied. The
        finding that they were held in contempt doesn’t satisfy the Trial
        Rules. And -- however, the quarterly reports need to be filed on

Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018     Page 5 of 12
              time. Mr. Martin’s interest is still protected through the Zurich
              insurance policy. . . . The lien is going to remain in place and go
              up by $68 every day at ten percent interest. Your client is going
              to get more money the longer that it takes to sell. Your client’s
              interest is protected by order of this Court. . . .

      Tr. Vol. II pp. 95-100.

[8]   The trial court then entered a written order as follows:

                  1.      That the Court finds that the subject Corvette
                          automobile is currently in the possession of Intervenor
                          Gino P. Burelli, II (hereinafter referred to as “Burelli”),
                          and has been since the last Order of this Court, and is
                          housed, per the requirements of a certain Zurich Policy
                          of Insurance at the Harbor Automotive store located in
                          Portage, Indiana;

                  2.      That Burelli shall continue to store, house and safe
                          keep the Corvette pursuant to all requirements of the
                          Zurich Insurance Policy, and shall maintain said
                          Zurich policy insuring the subject Corvette until said
                          vehicle is sold, or until further Order of this Court;

                  3.      That Burelli currently has a brokerage contract with
                          Charles Goldsborough to sell said Corvette automobile;
                          that Charles Goldsborough has been made aware of,
                          and has acknowledged in open court, the judgment lien
                          of Judgment-Plaintiff Larry Martin (hereinafter referred
                          to as “Martin”);

                  4.      That Martin’s Verified Motion for Proceedings
                          Supplemental should be and is hereby denied; that
                          Martin’s judgment shall continue to accrue interest at
                          the judgment interest rate set forth in the Judgment
      Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018      Page 6 of 12
                    from the State of Maryland, Montgomery County,
                    Cause No. 111475-C of 10% per annum on the unpaid
                    judgment itself, until paid in full;

            5.      That Martin’s judgment lien in the subject Corvette
                    automobile is hereby confirmed by this Court, in the
                    principal sum of $250,600.00, with present interest
                    (November 30, 2017) in the amount of $185,449.29, for
                    a total current amount of $436,049.29, with interest
                    continuing to accrue at the rate of $68.61 per diem;

            6.      That Burelli’s Verified Motion for Temporary
                    Restraining Order and Permanent Injunction is
                    granted, in part, in that Martin is preliminarily
                    restrained and enjoined from any further attempt to
                    seek physical possession of the subject Corvette
                    automobile, or to have it sold at auction prior to
                    midnight, August 7, 2018;

            7.      That during the period of time from the date of this
                    Court Order until August 7, 2018, Burelli shall utilize
                    his best efforts to sell the subject Corvette either
                    individually, or through a broker, for the highest
                    possible price given the unique nature of said Corvette
                    automobile; that if said vehicle has not been sold and
                    Martin’s judgment lien satisfied, by said date, there will
                    be an auction of some type as determined by the Court;

            8.      That Burelli shall prepare and file quarterly reports,
                    concerning the efforts to sell and/or refurbish said
                    Corvette automobile from the date of this Order
                    through August 7, 2018, with the first quarterly report
                    due on or before December 31, 2017, and quarterly
                    thereafter until such time as the car is sold, or until
                    further Order of this Court; the Court finds that the

Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018      Page 7 of 12
                    quarterly reports required pursuant to prior Order of
                    this Court were not timely filed; Burelli is cautioned
                    that said reports must be filed timely or the Court may
                    entertain a motion for sanctions should he fail to do so;

            9.      That in the event the subject Corvette is sold, said funds
                    shall be held in escrow and disbursed by the broker or
                    other sales agent in the following priority:

                    a. the judgment lien of Martin shall first be satisfied
                       including interest up to the date of payment (the
                       broker or sales agent shall confirm the amount
                       through counsel for Martin and counsel for Burelli);

                    b. any brokerage or sales agent fee;

                    c. any amount remaining due Kevin J. Mackay
                       pursuant to the prior agreement between Kevin J.
                       Mackay and Burelli;

                    d. the remaining sum to be paid to Burelli;

            10.     That Burelli shall have the right to pay off Martin’s
                    judgment at any time, which payoff shall include
                    interest up to the date of payoff;

            11.     That Martin’s request for a finding of contempt and
                    bad faith against Burelli is denied[.]

Appellant’s App. Vol. II pp. 9-11. Martin now appeals.

Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018    Page 8 of 12
                                                   Analysis
[9]    Martin is appealing the trial court’s order in the proceedings supplemental in

       Martin’s attempts to collect a judgment against Idoni. “Just as equitable

       principles are involved in proceedings supplemental as a remedy to creditors in

       discovering assets in collection of their judgments, it is appropriate under these

       specific circumstances for the trial court to exercise its equitable power here to

       protect the interests of” third parties, such as garnishee defendants. Branham

       Corp. v. Newland Res., LLC, 44 N.E.3d 1263, 1273 (Ind. Ct. App. 2015). “As a

       general proposition, the trial court has full discretion to fashion equitable

       remedies that are complete and fair to all parties involved.” Id. (quoting Swami,

       Inc. v. Lee, 841 N.E.2d 1173, 1178 (Ind. Ct. App. 2006), trans. denied).

       “Nonetheless, trial courts will not exercise equitable powers when an adequate

       remedy at law exists.” Id. “Where necessary, equity has the power to pierce

       rigid statutory rules to prevent injustice.” Id. “But if substantial justice can be

       accomplished by following the law, and the parties’ actions are clearly governed

       by rules of law, equity follows the law.” Id.

[10]   Here, Burelli filed a motion for a preliminary injunction to delay a sheriff’s sale

       of the vehicle. On appeal, Martin argues that the trial court erred by granting

       Burelli’s motion for preliminary injunction. In general, to obtain a preliminary

       injunction, the moving party must demonstrate by a preponderance of the

       evidence: (1) a reasonable likelihood of success at trial; (2) the remedies at law

       are inadequate; (3) the threatened injury to the movant outweighs the potential

       harm to the nonmoving party from the granting of an injunction; and (4) the

       Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018   Page 9 of 12
       public interest would not be disserved by granting the requested injunction.

       Cent. Indiana Podiatry, P.C. v. Krueger, 882 N.E.2d 723, 727 (Ind. 2008). The

       reasonable likelihood of success at trial factor appears to be inapplicable here

       because we are dealing with proceedings supplemental, and there is no

       argument that Martin’s lien is invalid. Injunctions in the context of proceedings

       supplemental, although rare, are permissible. See, e.g., 13 Ind. Law Encyc.

       Execution § 36 (“An injunction to prevent a party from making use of a writ of

       execution will be granted where there is some recognized ground for equity to

       interpose its power to grant relief.”). We also note that “[e]quity will not

       interfere to restrain a sale under execution of property belonging to a person

       other than the judgment debtor, unless such property has a special value,

       rendering compensation in damages impossible, or such sale will result in

       consequential damages, or the claim of one party involves or depends on some

       equitable interest or feature.” 13 Ind. Law Encyc. Execution § 37 (citing Boone v.

       Van Gorder, 164 Ind. 499, 74 N.E. 4 (1905))

[11]   Indiana Trial Rule 52(A) requires a trial court to make special findings of fact

       without request “in granting or refusing preliminary injunctions.” Further,

       Indiana Trial Rule 65(D) provides: “Every order granting temporary injunction

       and every restraining order shall include or be accompanied by findings as

       required by Rule 52 . . . .” A trial court’s failure to enter findings of fact and

       conclusions of law, as required by Indiana Trial Rule 52 and Indiana Trial Rule

       65, in an order granting a preliminary injunction constitutes reversible error.

       GKC Indiana Theatres, Inc. v. Elk Retail Inv’rs, LLC., 764 N.E.2d 647, 651 (Ind.

       Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018   Page 10 of 12
       Ct. App. 2002). “The purpose of Rule 52(A) is ‘to provide the parties and the

       reviewing court with the theory upon which the trial judge decided the case in

       order that the right of review for error may be effectively preserved.’” In re

       Paternity of S.A.M., 85 N.E.3d 879, 885 (Ind. Ct. App. 2017) (quoting Carmichael

       v. Siegel, 670 N.E.2d 890, 891 (Ind. 1996)). “Oral findings and conclusions can

       achieve this purpose so long as they are thoroughly detailed in the record.” Id.

[12]   Here, the trial court’s order is lacking the required special findings of fact that

       are required pursuant to Indiana Trial Rule 52 and 65. The trial court’s order

       addresses several motions, including the motion for a preliminary injunction.

       However, the specific portions of the order addressing the motion for

       preliminary injunction merely grant the preliminary injunction and give details

       on how Burelli should attempt to sell the vehicle. The trial court did not

       mention any of the factors that are considered in evaluating whether to grant a

       preliminary injunction. Even if we consider the trial court’s oral comments at

       the end of the hearing, the findings are simply inadequate to permit appellate

       review. The trial court explained the relief it was ordering without explaining

       why an injunction was necessary. We remand this cause for the trial court to

       make specific findings of fact and conclusions thereon as required by Indiana

       Trial Rule 52 and Indiana Trial Rule 65.

       Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018   Page 11 of 12
                                                Conclusion
[13]   The trial court’s findings are inadequate to permit appellate review of its order

       granting Burelli’s preliminary injunction. We remand with instruction for the

       trial court to make specific findings of fact and conclusions thereon.

[14]   Remanded.

       Vaidik, C.J., and Pyle, J., concur.

       Court of Appeals of Indiana |Memorandum Decision 18A-MI-25| May 29, 2018   Page 12 of 12