Court Opinion

ID: 3183941
Source: CourtListenerOpinion
Date Created: 2016-03-09 16:21:14.499436+00
Date Added: 2024-06-11T12:24:25.972161
License: Public Domain

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be                               Mar 09 2016, 9:02 am
regarded as precedent or cited before any
court except for the purpose of establishing
the defense of res judicata, collateral
estoppel, or the law of the case.

ATTORNEY FOR APPELLANT                                   ATTORNEYS FOR APPELLEE
Adam J. Sedia                                            Mark L. Phillips
Rubino, Ruman, Crosmer & Polen                           Anthony G. Novak
Dyer, Indiana                                            LaPorte, Indiana

                                           IN THE
    COURT OF APPEALS OF INDIANA

Selah Academy, Inc., Aquanatte                           March 9, 2016
Ruffin, and Lawrence Ruffin,                             Court of Appeals Case No.
Appellants-Defendants,                                   46A04-1508-PL-1186
                                                         Appeal from the LaPorte Superior
        v.                                               Court
                                                         The Honorable Jeffrey L. Thorne,
Jackqueline Jones,                                       Judge
Appellee-Plaintiff.                                      The Honorable V. Michael
                                                         Drayton, Pro Tem
                                                         Trial Court Cause No.
                                                         46D03-1412-PL-2158

Altice, Judge.

                                         Case Summary

Court of Appeals of Indiana | Memorandum Decision 46A04-1508-PL-1186 | March 9, 2016       Page 1 of 10
[1]   Selah Academy, Inc. (Selah) and one of its two principal officers, Aquanatte

      Ruffin (Aquanatte), (collectively, the Defendants) appeal from the trial court’s

      denial of their motion to set aside a default judgment entered against them

      pursuant to Ind. Trial Rule 60(B). The Defendants present one issue for our

      review: Did the trial court abuse its discretion in denying their motion to set

      aside the default judgment?

[2]   We affirm.

                                          Facts & Procedural History

[3]   On March 14, 2006, Lawrence Ruffin (Lawrence) and Aquanatte organized

      Selah, an Indiana non-profit corporation that provides rehabilitative services to

      children with behavioral problems. At all times, Lawrence served as Selah’s

      President and CEO and Aquanatte served as its Vice President. On November

      1, 2012, Jackqueline Jones was hired as a program coordinator for Selah, and

      she continued in that role until her resignation on January 21, 2014.

[4]   On December 15, 2014, Jones filed a complaint against the Defendants and

      Lawrence, seeking to recover for unpaid wages, overtime compensation, and

      other related damages.1 After the Defendants and Lawrence were served with

      the complaint, Lawrence asserts that he and Aquanatte agreed that Lawrence

      would seek legal advice from Attorney Robert Lewis (Attorney Lewis).

      1
          Jones sought recovery under Indiana’s Wage Payment Statute and the federal Fair Labor Standards Act.

      Court of Appeals of Indiana | Memorandum Decision 46A04-1508-PL-1186 | March 9, 2016           Page 2 of 10
      Lawrence asserts that Attorney Lewis advised him to file a chronological case

      summary (CCS) form denying the claims asserted by Jones.

[5]   On January 9, 2015, Lawrence went to the La Porte County Clerk’s office and,

      in accordance with Attorney Lewis’s advice, filed a handwritten CCS form

      stating, “I want to dispute this case and set for hearing.” Appellants’ Appendix at

      28. Lawrence signed the CCS form in his own name. It was Lawrence’s

      understanding that such filing sufficed as a response to Jones’s complaint on

      behalf of himself and the Defendants. The trial court set a hearing for February

      27, 2015, and ordered all parties to appear.

[6]   On February 19, 2015, Jones filed a motion for default judgment against the

      Defendants. Jones did not request entry of default judgment against Lawrence,

      indicating in her motion that “Lawrence is the only one to have appeared,

      plead, or otherwise defend [sic] himself in this action.” Appellee’s Appendix at 2.

      Two days before the scheduled hearing, Lawrence filed a request to reset the

      hearing, claiming additional time was needed to prepare. 2 The trial court

      denied Lawrence’s request and ordered all parties to appear in person or by

      counsel at the February 27 hearing. Notice was sent to Lawrence and the

      Defendants. The Defendants, however, failed to appear. After the hearing, the

      2
        Lawrence’s handwritten CCS form stated, “I want to reset the hearing due to needing more documentation
      for the hearing.” Appellee’s Appendix at 7. The form was signed only by Lawrence.

      Court of Appeals of Indiana | Memorandum Decision 46A04-1508-PL-1186 | March 9, 2016         Page 3 of 10
      trial court entered an order granting default judgment against the Aquanatte

      and Selah and in favor of Jones.

[7]   On March 23, 2015, Jones moved for proceedings supplemental. The trial

      court ordered the Defendants to appear before the court on April 15, 2015.

      Neither showed. On April 24, 2015, Jones filed a Motion for Rule to Show

      Cause. The trial court ordered the Defendants to appear for a hearing on

      Jones’s motion on June 22, 2015, and service on the Defendants was perfected

      by the Lake County Sheriff’s Department on April 30. On May 19, 2015, an

      attorney entered an appearance on behalf of the Defendants and filed a motion

      to set aside the default judgment and to stay the proceedings supplemental.3

      Over Jones’s objection, the trial court stayed the proceedings supplemental,

      vacated the hearing on rule to show cause, and set a hearing on the Defendants’

      motion to set aside judgment for July 13, 2015. The Defendants were present

      before the court for that hearing. On July 28, 2015, the trial court entered its

      order denying the Defendants’ motion to set aside judgment. The Defendants

      then filed a motion to correct error, which the trial court denied. This appeal

      ensued.

                                           Discussion & Decision

      3
        The motion to set aside default judgment was also made on behalf of Lawrence. However, as noted by the
      trial court, default judgment was never entered against Lawrence.

      Court of Appeals of Indiana | Memorandum Decision 46A04-1508-PL-1186 | March 9, 2016         Page 4 of 10
[8]   The Defendants argue that the trial court abused its discretion in denying their

      motion to set aside judgment pursuant to Ind. Trial Rule 60(B)(1) and (8). The

      Defendants maintain that they “acted with reasonable promptness and

      diligence” in contesting Jones’s claim. Appellants’ Appendix at 10. They further

      argue that they reasonably relied upon “defective legal advice,” which they

      assert constitutes a mistake justifying an order setting aside the default

      judgment entered against them. Id. at 1.

[9]   In Huntington Nat’l Bank v. Car-X Ass’n Corp., our Supreme Court set forth the

      standard governing a trial court’s decision to set aside a default judgment.

              The decision whether to set aside a default judgment is given
              substantial deference on appeal. Our standard of review is
              limited to determining whether the trial court abused its
              discretion. An abuse of discretion may occur if the trial court’s
              decision is clearly against the logic and effect of the facts and
              circumstances before the court, or if the court has misinterpreted
              the law. . . . The trial court’s discretion is necessarily broad in
              this area because any determination of excusable neglect,
              surprise, or mistake must turn upon the unique factual
              background of each case . . . . A cautious approach to the grant
              of motions for default judgment is warranted in “cases involving
              material issues of fact, substantial amounts of money, or weighty
              policy determinations.” In addition, the trial court must balance
              the need for an efficient judicial system with the judicial
              preference for deciding disputes on the merits. Furthermore,
              reviewing the decision of the trial court, we will not reweigh the
              evidence or substitute our judgment for that of the trial court.
              Upon a motion for relief from a default judgment, the burden is
              on the movant to show sufficient grounds for relief under Indiana
              Trial Rule 60(B).

      Court of Appeals of Indiana | Memorandum Decision 46A04-1508-PL-1186 | March 9, 2016   Page 5 of 10
       39 N.E.3d 652, 655 (Ind. 2015) (quoting Kmart Corp. v. Englebright, 719 N.E.2d
1249, 1253 (Ind. Ct. App. 1999)) (internal citations omitted).

[10]   We first consider application of T.R. 60(B)(1). A motion to set aside a

       judgment pursuant to T.R. 60(B)(1) does not attack the substantive, legal merits

       of a judgment, but rather addresses the procedural, equitable grounds justifying

       relief from the finality of a judgment. Blichert v. Brososky, 436 N.E.2d 1165,

       1167 (Ind. Ct. App. 1982). To prevail on a motion to set aside a default

       judgment based on mistake, surprise, or excusable neglect, a party is not only

       required to show mistake, surprise, or excusable neglect, but also must show

       that he has a good and meritorious defense to the cause of action. Burke v.

       DeLarosa, 661 N.E.2d 43, 45 (Ind. Ct. App. 1996), trans. denied.

[11]   After the Defendants and Lawrence were served with Jones’s complaint,

       Lawrence apparently took the complaint and summons for each named

       defendant to Attorney Lewis, who Lawrence asserted was an attorney who

       represented him in another matter. According to Lawrence, Attorney Lewis

       advised him that he needed to file a CCS form with the court denying all of

       Jones’s claims. Lawrence did just that, believing that he was undertaking such

       action on behalf of all named defendants, i.e., himself, Aquanatte, and Selah.

       The Defendants now characterize Attorney Lewis’s advice to Lawrence as

       “defective legal advice” and argue that their reliance on that advice constitutes

       a mistake on their part. Appellants’ Appendix at 1.

       Court of Appeals of Indiana | Memorandum Decision 46A04-1508-PL-1186 | March 9, 2016   Page 6 of 10
[12]   In rejecting the Defendants’ asserted grounds for setting aside the default

       judgment, the trial court noted that the Defendants were inconsistent in

       identifying Attorney Lewis’s relationship to them in terms of establishing

       whether the purported legal advice he gave was directed to them. The court

       noted that in their initial pleadings, Attorney Lewis is identified as Lawrence’s

       attorney in another matter. During the hearing on Defendants’ motion, counsel

       for the Defendants identified Attorney Lewis as Lawrence’s divorce attorney.

       The day following the hearing, Lawrence and Aquanatte submitted

       supplemental affidavits to the court in which they “now” identified Attorney

       Lewis as corporate counsel for Selah who often provided legal advice to

       Aquanatte with respect to matters relating to Selah. Id. at 10. The trial court

       found it “disconcerting” that the evidence seemed to change “to go with what

       direction the wind is blowing.” Id. The trial court found that even if Attorney

       Lewis had given poor legal advice, the Defendants had not established that that

       he was representing their interests4 and thus, reliance on his legal advice could

       not constitute a mistake or excusable neglect on their part.

[13]   The trial court set forth additional reasons for rejecting the Defendants’

       arguments that the default judgment should be set aside on the basis of mistake,

       surprise, or excusable neglect, noting that the Defendants failed to appear for

       the hearing on Jones’s motion for default judgment, even after having been

       4
         The trial court also noted that Attorney Lewis never entered his appearance on behalf of the Defendants in
       this matter.

       Court of Appeals of Indiana | Memorandum Decision 46A04-1508-PL-1186 | March 9, 2016             Page 7 of 10
       ordered twice to do so. The Defendants also failed to appear a third time for a

       proceeding supplemental hearing. It was not until five months after Jones’s

       complaint was filed and after the trial court ordered the Defendants to appear

       for a rule to show cause hearing that an attorney entered an appearance on

       behalf of the Defendants. The trial court noted that the Defendants never

       attempted to explain why they failed to comply with the court’s orders to

       appear for the various hearings, nor did they allege that their failure to appear at

       those hearings was based upon “poor legal advice.” Id. at 11. The trial court

       also considered the fact that Lawrence’s CCS entry purported to be only on his

       behalf. Specifically, the court noted that Lawrence’s entry stated, “I want to

       dispute this case,” not “we” want to dispute this case. Id. at 11. Based on the

       foregoing, the court concluded that the Defendants simply “ignored the default

       judgment and did nothing.” Id. at 12.

[14]   The trial court further concluded that to the extent the Defendants could rely on

       any legal advice given by Attorney Lewis, such did not warrant setting aside the

       default judgment. To be sure, “[t]he general rule has been long and firmly

       established that the negligence of the attorney is the negligence of the client and

       relief from a judgment taken by default will not be granted unless the negligence

       of the attorney is shown to be excusable.” Moe v. Koe, 330 N.E.2d 761, 765

       (Ind. Ct. App. 1975). The trial court stated that it was “not persuaded that a

       ‘mistake’ nor ‘surprise’ not even ‘excusable neglect’ as required by T.R. 60(B)

       occurred in this case.” Id. at 15. Upon review, we find that the record supports

       the trial court’s findings and conclusions. We therefore cannot say the trial

       Court of Appeals of Indiana | Memorandum Decision 46A04-1508-PL-1186 | March 9, 2016   Page 8 of 10
       court abused its discretion in refusing to set aside the default judgment under

       T.R. 60(B)(1).

[15]   The Defendants also argue that the trial court should have exercised its

       equitable power and granted their request to set aside the default judgment

       pursuant to T.R. 60(B)(8). Under that provision, a trial court may act within its

       discretion to set aside a judgment upon a showing of exceptional circumstances

       justifying extraordinary relief. See Brimhall v. Brewster, 864 N.E.2d 1148, 1153

       (Ind. Ct. App. 2007), trans. denied.

               [Trial Rule] 60(B)(8) is an omnibus provision which gives broad
               equitable power to the trial court in the exercise of its discretion
               and imposes a time limit based only on reasonableness.
               Nevertheless, under T.R. 60(B)(8), the party seeking relief from
               the judgment must show that its failure to act was not merely due
               to an omission involving . . . mistake, surprise or excusable
               neglect. Rather some extraordinary circumstances must be
               demonstrated affirmatively. This circumstance must be other
               than those circumstances enumerated in the preceding
               subsections of T.R. 60(B).

       Id. (quoting Ind. Ins. Co. v. Ins. Co. of N. Am., 734 N.E.2d 276, 279-80 (Ind. Ct.

       App. 2000), trans. denied (internal quotation omitted)). The Defendants’

       arguments under this provision are the same as their arguments under T.R.

       60(B)(1), i.e., that their reliance on poor legal advice justifies setting aside the

       default judgment entered against them. The trial court found that these are not

       extraordinary circumstances falling within the parameters of T.R. 60(B)(8) so as

       to justify relief from operation of the judgment herein. We conclude that the

       Court of Appeals of Indiana | Memorandum Decision 46A04-1508-PL-1186 | March 9, 2016   Page 9 of 10
       facts contained in the record before us support the trial court’s conclusion in

       this regard.

[16]   Having concluded that the Defendants have not established mistake, surprise,

       or excusable neglect or other extraordinary circumstances justifying relief, we

       need not consider whether they have a meritorious defense. See Moe, at 764

       (noting that a party seeking to set aside a judgment must show both that the

       judgment entered was a result of mistake, surprise, or excusable neglect and

       that there is a meritorious defense to the claim).

       Judgment affirmed.

       Robb, J. and Barnes, J., concur.

       Court of Appeals of Indiana | Memorandum Decision 46A04-1508-PL-1186 | March 9, 2016   Page 10 of 10