Court Opinion

ID: 4014886
Source: CourtListenerOpinion
Date Created: 2016-07-12 15:04:33.393852+00
Date Added: 2024-06-11T14:29:36.015178
License: Public Domain

MEMORANDUM DECISION
                                                                       FILED
Pursuant to Ind. Appellate Rule 65(D),
                                                                   Jul 12 2016, 8:31 am
this Memorandum Decision shall not be
regarded as precedent or cited before any                              CLERK
                                                                   Indiana Supreme Court
court except for the purpose of establishing                          Court of Appeals
                                                                        and Tax Court

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

ATTORNEY FOR APPELLANT                                   ATTORNEY FOR APPELLEE
Crystal Sharp Bauer                                      Martha L. Wischmeyer
Law Office of Crystal Bauer                              Valparaiso, Indiana
Valparaiso, Indiana

                                           IN THE
    COURT OF APPEALS OF INDIANA

Edward Hearn,                                            July 12, 2016
Appellant-Respondent,                                    Court of Appeals Case No.
                                                         64A05-1504-DR-280
        v.                                               Appeal from the Porter Superior
                                                         Court
Anna Hearn,                                              The Honorable William E. Alexa,
Appellee-Petitioner.                                     Judge
                                                         The Honorable Katherine R.
                                                         Forbes, Magistrate
                                                         Trial Court Cause No.
                                                         64D02-0812-DR-12624

Vaidik, Chief Judge.

Court of Appeals of Indiana | Memorandum Decision 64A05-1504-DR-280 | July 12, 2016        Page 1 of 11
                                          Case Summary
[1]   After the trial court approved their divorce settlement, Edward Hearn

      (“Father”) and Anna Hearn (“Mother”) filed more than a dozen motions

      regarding the implementation of the settlement agreement. Father appeals the

      trial court’s rulings on several issues involving property division, spousal

      maintenance, child support, and attorney’s fees. We affirm.

                            Facts and Procedural History
[2]   In December 2008, Mother filed a petition to dissolve her marriage to Father.

      They eventually mediated a settlement of all outstanding issues, and the trial

      court approved the agreement in March 2010. Paragraph 20 of the agreement

      provided for the disposition of a rental property on Oak Street in Valparaiso,

      which Father managed during the marriage, as follows:

              Father shall quit-claim his interest in the Oak Street property to
              mother. Father shall bring the mortgage, real estate taxes now
              due and utility payments current on said real estate and upon his
              doing so mother shall then take over the financial responsibilities
              for said property including the payment of the mortgage, real
              estate taxes, utilities and other expenses associated therewith.
              All security deposits shall be transferred to mother. Mother shall
              obtain the release of father’s financial obligation due and owing
              on the mortgage for said real estate within one (1) year. In the
              event mother does not obtain father’s financial release on said
              obligation or becomes in arrears two (2) months or more, father
              may bring the payments current and he shall be entitled to a
              dollar for dollar credit for the payments which he made from the
              sale proceeds. Mother shall place the real estate for sale in the
              event of her default or upon her failure to obtain release of
      Court of Appeals of Indiana | Memorandum Decision 64A05-1504-DR-280 | July 12, 2016   Page 2 of 11
              father’s financial obligations related thereto within one (1) year of
              the entering of the decree. Mother shall be considered for all
              purposes as the successor in interest of all leases and father shall
              provide mother with the originals of same.

      Ex. 1, ¶20. The agreement also required Father to pay $35,000 to Mother’s

      attorneys and $2000 in spousal maintenance to Mother every month for twelve

      months (a total of $24,000).

[3]   Shortly after the trial court approved the agreement, Mother contacted the Oak

      Street tenants and took over receipt of the rent payments. However, Father

      continued paying most or all of the expenses on the property, though without

      actually bringing them current, which would have shifted the expenses to

      Mother under paragraph 20 of the settlement agreement. Father continued to

      pay expenses until Mother completed the refinancing in May 2011. In turn, he

      deducted these amounts from the maintenance he was required to pay Mother.

      As a result, he paid Mother only $3610.57 in maintenance over the twelve

      months following the settlement, rather than the ordered amount of $24,000.

[4]   Between April 2010 and December 2012, the parties filed numerous motions

      relating to the implementation of the settlement agreement, including multiple

      motions regarding Father’s maintenance obligation and the handling of the Oak

      Street property. Father also filed a motion to reduce the amount of child

      support he was required to pay.

[5]   After holding at least eight days of hearings between 2012 and 2014, the trial

      court issued a single order resolving all pending motions. The three rulings

      Court of Appeals of Indiana | Memorandum Decision 64A05-1504-DR-280 | July 12, 2016   Page 3 of 11
      Father challenges on appeal are as follows: (1) that Father’s decision to

      continue paying the Oak Street expenses did not reduce the amount he owed

      for maintenance, meaning that he is responsible for a maintenance arrearage in

      excess of $20,000; (2) that Father’s weekly child support obligation “for the

      calendar year 2014 and going forward” is $367, Appellant’s App. p. 199; and

      (3) that Father owes $500 to one of Mother’s attorneys, James Daugherty,

      “[p]ursuant to the parties[’] Agreed Dissolution Decree,” id. at 203.

                                 Discussion and Decision
                                     I. Oak Street Expenses
[6]   Father first contends that the trial court’s calculation of his financial obligation

      to Mother should have included a credit in his favor based on the fact that he

      continued paying the expenses on the Oak Street property after Mother began

      receiving the rents. He asserts that he was entitled to receive the rents as long as

      he was paying the expenses, and he seeks a credit equaling either the rents

      received by Mother or the mortgage payments he made. Father asserts that the

      trial court’s refusal to give him such a credit was based on a misinterpretation of

      the settlement agreement. As with any contract, interpretation of a settlement

      agreement presents a question of law and is reviewed de novo. Bailey v. Mann,

      895 N.E.2d 1215, 1217 (Ind. 2008).

[7]   Father concedes that Mother was to become the sole owner of the Oak Street

      property under the settlement agreement. Furthermore, he does not dispute

      Mother’s assertion that, under Indiana law, the owner of a rented property is
      Court of Appeals of Indiana | Memorandum Decision 64A05-1504-DR-280 | July 12, 2016   Page 4 of 11
      generally entitled to receive the rents. See Appellee’s Br. p. 15 (citing

      Washington Auto Sales Co. v. People’s State Bank, 100 Ind. App. 1, 194 N.E. 184

      (1935)); see also Appellant’s Reply Br. p. 12. Instead, he argues that he and

      Mother agreed to depart from this general rule, that is, they agreed that the

      party paying the expenses would also receive the rents, regardless of ownership.

[8]   Specifically, Father relies on the second sentence of paragraph 20 of the parties’

      settlement agreement, which provides: “Father shall bring the mortgage, real

      estate taxes now due and utility payments current on said real estate and upon

      his doing so mother shall then take over the financial responsibilities for said

      property including the payment of the mortgage, real estate taxes, utilities and

      other expenses associated therewith.” Ex. 1, ¶20. According to Father, this

      sentence allowed him to continue receiving the rents until he brought the

      expenses current, and because he never brought the expenses current before

      Mother refinanced the property in May 2011, he was entitled to the rent

      payments during that entire period. In other words, Father reads the sentence

      to mean that he could receive the rents as long as he wished (and deprive

      Mother of the rents as long as he wished) simply by keeping the expenses in

      arrears. But the sentence says nothing about entitlement to rents; it addresses

      only the payment of expenses.

[9]   Furthermore, “[i]n interpreting a contract, we are compelled to view a

      particular section as a whole rather than examine each phrase therein in

      isolation.” Steiner v. Bank One Ind., N.A., 805 N.E.2d 821, 824-25 (Ind. Ct. App.

      2004). To the extent that there is any ambiguity in the second sentence of

      Court of Appeals of Indiana | Memorandum Decision 64A05-1504-DR-280 | July 12, 2016   Page 5 of 11
paragraph 20, it is cleared up by the remainder of the paragraph. The first

sentence provides, “Father shall quit-claim his interest in the Oak Street

property to mother.” Ex. 1, ¶20. It does not say, “Father shall quit-claim his

interest in the Oak Street property to mother after he brings the expenses current.”

Another sentence provides, “All security deposits shall be transferred to

mother.” Ex. 1, ¶20. It does not say, “All security deposits shall be transferred

to mother after Father brings the expenses current.” Perhaps most importantly, the

final sentence provides, “Mother shall be considered for all purposes as the

successor in interest of all leases[.]” Ex. 1, ¶20. It does not say, “Mother shall

be considered for all purposes as the successor in interest of all leases after Father

brings the expenses current.” Father did not quote these parts of paragraph 20 in

his brief, presumably because they are directly at odds with his strained

interpretation of the second sentence. Read as a whole, the meaning of the

paragraph is clear: Mother was to become the owner of the Oak Street

property, and therefore entitled under Indiana law to receive the rents,

regardless of when or whether Father brought the expenses current. The trial

court was correct to interpret the provision as such.1

1
  The trial court ordered Father to pay $25,000 of Mother’s attorney’s fees based in part on the “many issues
surrounding the Oak Street Property.” Appellant’s App. p. 206. As such, Father contends that if we reverse
the trial court’s ruling regarding the Oak Street property, we should also reverse its attorney-fee award.
Because we affirm the trial court’s ruling on the Oak Street property, we need not address the fee award.

Court of Appeals of Indiana | Memorandum Decision 64A05-1504-DR-280 | July 12, 2016               Page 6 of 11
                                           II. Child Support
[10]   Next, Father asks us to “remand the case to recalculate the child support

       obligation for 2014 and forward[.]” Appellant’s Reply Br. p. 19. The trial court

       set that obligation at $367 per week based in part on its determination that

       Mother incurs a “Work-related Child Care Expense” of $175 per week.

       Appellant’s App. p. 212. According to Father, the trial court reached the $175

       figure based in part on the fact that “Mother claimed that she paid her

       babysitter $200 and then $250 per week.” Appellant’s Br. p. 23. This, Father

       says, is where the trial court erred. He contends that Mother was “judicially

       estopped” from claiming $200-$250 in weekly child-care expenses because, for

       tax years 2011 and 2013, respectively, Mother submitted forms to the IRS

       indicating gross child-care expenses of $4100 (approximately $79 per week) and

       $5000 (approximately $96 per week). Appellant’s Br. p. 22. In support of his

       argument, Father relies on our decision in Chance v. State Auto Insurance Cos.,

       684 N.E.2d 569 (Ind. Ct. App. 1997), reh’g denied, trans. denied. There are three

       flaws in Father’s argument.

[11]   First, Father’s claim of “judicial estoppel” is misplaced. The doctrine of

       judicial estoppel involves inconsistent positions taken in judicial proceedings.

       See, e.g., Wabash Grain, Inc. v. Smith, 700 N.E.2d 234, 237-38 (Ind. Ct. App.

       1998) (addressing allegedly inconsistent positions taken in state-court case and

       related federal-court case), reh’g denied, trans. denied. Here, though, Father

       alleges that Mother’s in-court assertion about her child-care expenses was

       inconsistent with earlier assertions made on tax forms, outside of litigation.

       Court of Appeals of Indiana | Memorandum Decision 64A05-1504-DR-280 | July 12, 2016   Page 7 of 11
[12]   Second, even if we disregard that threshold legal error, Father has not provided

       a record sufficient to allow for meaningful appellate review of his claim.

       Perhaps Mother had a perfectly reasonable explanation for any alleged

       inconsistency between her tax forms and her in-court testimony. Perhaps she

       did not. The reason we do not know is that Father had only some of the

       testimony and exhibits transcribed for purposes of his appeal. He is unable

       even to provide a record citation for his assertion that “Mother claimed that she

       paid her babysitter $200 and then $250 per week.” Appellant’s Br. p. 23. Our

       rules require an appellant to provide “all portions of the Transcript necessary to

       present fairly and decide the issues on appeal.” Ind. Appellate Rule 9(F)(5).

       Father failed to do so with regard to his judicial estoppel argument, which

       means that the argument is waived. See, e.g., Meisberger v. Bishop, 15 N.E.3d

       653, 659 (Ind. Ct. App. 2014).

[13]   Third, notwithstanding this waiver, Father has not identified the sort of clear,

       direct inconsistency that would justify a finding of estoppel. In the case he

       relies on, Chance, we held that a mother was estopped from asserting that her

       son was a resident of her Fort Wayne home for purposes of an insurance claim

       after she asserted that he was a resident of someone else’s home in Marion for

       purposes of an earlier, closely-related insurance claim. 684 N.E.2d at 571.

       Here, Father tells us (again, without citation to the record) that “Mother

       claimed that she paid her babysitter $200 and then $250 per week,” and he

       asserts that this is inconsistent with entries Mother made on tax forms for 2011

       and 2013. But—even if we assume that those entries mean what Father says

       Court of Appeals of Indiana | Memorandum Decision 64A05-1504-DR-280 | July 12, 2016   Page 8 of 11
       they mean—he does not allege, let alone establish, that Mother was talking

       about 2011 or 2013 when she claimed to have paid $200-$250 per week. It is

       possible that Mother was testifying about her expenses in 2010, 2012, or the

       first half of 2014 (when several of the hearings were held), or even her

       anticipated expenses for the remainder of 2014 or for 2015. If she was, then

       there was no inconsistency, and if there was no inconsistency, there can be no

       estoppel, judicial or otherwise. See Wabash Grain, Inc., 700 N.E.2d at 237-38;

       Chance, 684 N.E.2d at 571. Father has not shown an inconsistency, and we will

       not presume one.

[14]   For all of these reasons, we reject Father’s judicial estoppel claim and affirm the

       trial court’s child-support calculations.

                        III. Fees Owed to Attorney Daugherty
[15]   Father also challenges the part of the trial court’s order that says the settlement

       agreement requires him to pay $500 to Attorney James Daugherty. While it is

       true that the settlement agreement required Father to pay $35,000 to Mother’s

       attorneys, Attorney Daugherty was not one of them. His representation of

       Mother did not begin until well after the parties reached their settlement.

       Therefore, the trial court erred when it wrote that Attorney Daugherty is owed

       $500 “[p]ursuant to the parties[’] Agreed Dissolution Decree[.]” Appellant’s

       App. p. 203.

[16]   However, the trial court did, after one of the many post-settlement hearings,

       order Father to pay $500 to Attorney Daugherty. In June 2011, Father filed a

       Court of Appeals of Indiana | Memorandum Decision 64A05-1504-DR-280 | July 12, 2016   Page 9 of 11
       motion to correct error relating to some of the attorney’s fees he owed under the

       settlement agreement. A hearing was scheduled for August 4, 2011, but at

       some point Father paid the fees in question, rendering his motion moot.

       Father, though, did not ask to have the hearing vacated, and Attorney

       Daugherty appeared as scheduled on behalf of Mother. Afterward, the trial

       court issued an order that provided in part:

               The court is advised that the subject matter of [Father’s] Motion
               to Corrects [sic], to-wit: the requirements for the payment of a
               $25,000 attorney fee judgment, is now moot in that payment has
               been remitted by [Father]. [Mother], by counsel, shows the court
               that since July 29, 2011, [Mother] has been seeking and has been
               requesting that this hearing be vacated, but that [Father] has
               failed to do so or to even contact the court.

               [Mother’s] Petition for the payment of attorney fees and
               sanctions in the sum of $500, based upon the travel time and time
               expended at court, is warranted and is hereby granted. [Father]
               is hereby ordered to remit the sum of $500 to [Mother’s] counsel,
               James E. Daugherty, within a period of 30 days from August 4,
               2011.

       Appellee’s App. p. 1.

[17]   On appeal, Father does not deny that he was directed to pay $500 to Attorney

       Daugherty. Rather, he asks us to reverse that part of the trial court’s order

       merely because the court misidentified the source of the obligation, referencing

       the settlement agreement itself instead of the post-settlement court order.

       However, as Mother notes, Indiana Appellate Rule 66(A) provides:

       Court of Appeals of Indiana | Memorandum Decision 64A05-1504-DR-280 | July 12, 2016   Page 10 of 11
               No error or defect in any ruling or order or in anything done or
               omitted by the trial court or by any of the parties is ground for
               granting relief or reversal on appeal where its probable impact, in
               light of all the evidence in the case, is sufficiently minor so as not
               to affect the substantial rights of the parties.

       The trivial error highlighted by Father falls squarely within the terms of this

       rule. The critical aspect of the trial court’s order is the existence of the $500

       obligation, not the precise origin of it. We will not disturb the trial court’s

       ruling on this issue.

[18]   Affirmed.

       Barnes, J., and Mathias, J., concur.

       Court of Appeals of Indiana | Memorandum Decision 64A05-1504-DR-280 | July 12, 2016   Page 11 of 11