Court Opinion

ID: 4112439
Source: CourtListenerOpinion
Date Created: 2016-12-30 17:06:52.313065+00
Date Added: 2024-06-11T14:46:28.263131
License: Public Domain

MEMORANDUM DECISION
      Pursuant to Ind. Appellate Rule 65(D),                               FILED
      this Memorandum Decision shall not be                           Dec 30 2016, 8:51 am
      regarded as precedent or cited before any                            CLERK
      court except for the purpose of establishing                     Indiana Supreme Court
                                                                          Court of Appeals
      the defense of res judicata, collateral                               and Tax Court

      estoppel, or the law of the case.

      ATTORNEY FOR APPELLANT                                   ATTORNEY FOR APPELLEES
      William J. O’Connor                                      Joseph Banasiak
      Hammond, Indiana                                         Highland, Indiana

                                                IN THE
          COURT OF APPEALS OF INDIANA

      Hugo Torres,                                             December 30, 2016
      Appellant-Plaintiff,                                     Court of Appeals Case No.
                                                               45A05-1608-PL-1892
              v.                                               Appeal from the Lake Superior
                                                               Court
      Dean White and Town and                                  The Honorable John M. Sedia,
      Country Remodeling, Inc.,                                Judge
      Appellees-Defendants                                     Trial Court Cause No.
                                                               45D01-1510-PL-99

      Crone, Judge.

                                             Case Summary
[1]   Hugo Torres sued Dean White and Town and Country Remodeling, Inc.

      (“Town and Country”) (collectively “Appellees”), for breach of contract and

      fraud and filed a motion for judgment on the pleadings. The trial court granted

      Court of Appeals of Indiana | Memorandum Decision 45A05-1608-PL-1892 | December 30, 2016   Page 1 of 8
      the motion on the issue of liability and set a hearing on damages. After the

      hearing, the trial court entered judgment in favor of Torres and against Town

      and Country for $11,600. Torres now appeals, claiming that the damages

      award is inadequate. We disagree and therefore affirm.

                                   Facts and Procedural History
[2]   Torres owns a home in Hammond. In August 2013, Torres signed a contract

      with Town and Country to perform certain repairs on the home’s exterior.

      White signed the contract for Town and Country; the preprinted line beneath

      his signature reads, “SALESMAN TOWN & COUNTRY REMODELING[.]”

      Ex. 5. Pursuant to the contract, Torres made a down payment of $10,000 to

      Town and Country. Town and Country did not perform any work on Torres’s

      home.

[3]   In October 2015, Torres filed a complaint against Appellees for breach of

      contract and fraud. The complaint reads in relevant part as follows:

              7. Part of [Appellees’] performance of the parties’ contract was
              to remedy the alleged breaches by [Torres] of the City of
              Hammond Building Code Ordinances.[ 1]

              8. Due to [Appellees’] total failure to perform, [Torres] was
              subjected to ordinance violation proceedings and on October 1,
              2015, due to [Appellees’] non-performance a bid award for the

      1
       The code violations were the subject of two prior appeals: Torres v. City of Hammond, 12 N.E.3d 908 (Ind.
      Ct. App. 2014), and Torres v. City of Hammond, No. 45A03-1210-OV-430, 2013 WL 2146483 (Ind. Ct. App.
      May 15, 2013), trans. denied.

      Court of Appeals of Indiana | Memorandum Decision 45A05-1608-PL-1892 | December 30, 2016         Page 2 of 8
        demolition of [Torres’s] residence [was] made by the City of
        Hammond Board of Public Works and Safety. That award was
        completed and [Torres’s] home and residence will be demolished
        in approximately 45 to 60 days due to [Appellees’] breach of
        contract.

        9. [Appellees] have therefore breached the contract with
        [Torres], who has been damaged in the sum of $100,000.

        ….

        Wherefore, [Torres] requests judgment against [Appellees] in the
        sum of one hundred thousand dollars ($100,000.00), plus
        punitive damages, attorney fees, costs and all other proper relief.

        ….

        12. That [Appellees] fraudulently concealed from [Torres] that
        [Appellees] did not possess a City of Hammond Building license,
        contracting license, or any other authority to lawfully do business
        in the City of Hammond.

        13. That [Appellees] had no intention of obtaining said licenses
        during the course of their performance, which became non-
        performance.

        14. [Torres] relied on the representation of [Appellees], and
        would not have entered into the contract or paid [Appellees] the
        ten thousand dollars had he known of [Appellees’] false and
        fraudulent representation.

        15. [Appellees’] conduct was malicious, fraudulent, and
        oppressive, justifying an award of punitive damages.

Appellant’s App. at 18-19. Torres’s home was demolished in November 2015.

Court of Appeals of Indiana | Memorandum Decision 45A05-1608-PL-1892 | December 30, 2016   Page 3 of 8
[4]   In their reply to Torres’s complaint, Appellees admitted to receiving $10,000

      from Torres and not repairing his home. Torres filed a motion for judgment on

      the pleadings on the issue of liability and requested a hearing on damages. The

      trial court granted the motion, and a damages hearing was held in July 2016.

      At the hearing, Torres withdrew his request for punitive damages.

[5]   After the hearing, the trial court issued an order that reads in pertinent part as

      follows:

              1. Torres entered into a contract to have work done upon the
              house he owned located in Hammond, Indiana … with [Town
              and Country]. The contract imposed no personal liability upon
              White, so no damages for its breach are attributable to him.

              2. Town and Country breached the contract with Torres, took
              $10,000.00 from Torres, and performed no work upon the house.
              Town and Country is liable to Torres for $10,000.00 plus
              prejudgment interest from and after August 28, 2013 through
              July 20, 2016.

              3. The code violation proceedings pursued by the City of
              Hammond, Indiana regarding the house, culminating in an
              agreement executed between Torres and Hammond after
              Torres’s contract with Town and Country regarding repairs to the
              house to bring it into compliance and the ultimate demolition of
              the house by Hammond had nothing to do with Torres’s contract
              with Town and Country. Town and Country was contractually
              obligated to do the repairs upon the house specifically set forth in
              the contract. Nothing in the contract obligated Town and
              Country to bring the house into compliance with the Hammond
              building code. Torres is not entitled to any damages from Town
              and Country for the activities by Hammond in executing its own
              contract with Torres as to what was necessary to bring the house

      Court of Appeals of Indiana | Memorandum Decision 45A05-1608-PL-1892 | December 30, 2016   Page 4 of 8
              into compliance nor Hammond’s demolition of the house.

              IT IS THEREFORE ORDERED, ADJUDGED AND
              DECREED by the Court as follows:

              1. Judgment is entered in favor of [Torres] and against [Town
              and Country] for the amount of $10,000.00, together with
              prejudgment interest in the amount of $1,600.00 for a total of
              $11,600.00 plus the costs of filing this case.

              2. [Torres] shall take nothing from [White].

      Id. at 14-15. Torres now appeals.

                                     Discussion and Decision
[6]   The gist of Torres’s argument is that the trial court’s damages award is

      inadequate. “[T]he appropriate measure of damages in a breach of contract

      case is the loss actually suffered as a result of the breach.” Roche Diagnostics

      Operations, Inc. v. Marsh Supermarkets, LLC, 987 N.E.2d 72, 89 (Ind. Ct. App.

      2013), trans. denied. The injured party may recover the benefit of its bargain but

      is limited in its recovery to the loss actually suffered. L.H. Controls, Inc. v.

      Custom Conveyor, Inc., 974 N.E.2d 1031, 1043 (Ind. Ct. App. 2012). “The

      burden of pleading and proving damages rests with the plaintiff. Even if the

      plaintiff can show a breach of contract, he will not be entitled to a recovery of

      damages if he can prove no injury resulting from the breach.” Rauch v. Circle

      Theatre, 176 Ind. App. 130, 139-40, 374 N.E.2d 546, 553 (1978) (citation

      omitted), trans. denied. In a breach of contract action, damages must be proven

      with reasonable certainty. R & R Real Estate Co. v. C & N Armstrong Farms, Ltd.,

      Court of Appeals of Indiana | Memorandum Decision 45A05-1608-PL-1892 | December 30, 2016   Page 5 of 8
      854 N.E.2d 365, 370 (Ind. Ct. App. 2006). “The damages claimed must be the

      natural, foreseeable, and proximate consequence of the breach.” L.H. Controls,

      Inc., 974 N.E.2d at 1043. This principle also applies to fraud claims. See

      Linderman Mach. Co. v. Hillenbrand Co., 75 Ind. App. 111, 116, 127 N.E. 813,

      815 (1920) (“In an action for fraud, the damages to be recovered must always

      be the natural and proximate consequence of the act complained of.”), trans.

      denied. The party seeking consequential damages bears the burden of proving

      by a preponderance of the evidence that the breach was the cause in fact of its

      loss. L.H. Controls, Inc., 974 N.E.2d at 1043.

[7]   The computation of damages is a matter within the trial court’s sound

      discretion. Fischer v. Heymann, 12 N.E.3d 867, 870 (Ind. 2014). “When the

      specific issue on review relates to questions of inadequate or excessive damages,

      we should not reverse a damage award if the award is within the scope of the

      evidence before the trial court, and we may not reweigh the evidence or judge

      the credibility of the witnesses.” Randles v. Ind. Patient’s Comp. Fund, 860
N.E.2d 1212, 1230 (Ind. Ct. App. 2007), trans. denied. As the party that had the

      burden of proving damages, Torres is appealing from a negative judgment and

      must establish that the damages award is clearly erroneous or contrary to law to

      have it set aside. R & R Real Estate Co., 854 N.E.2d at 371.

[8]   Torres’s argument is best summarized in the conclusion section of his brief:

              Torres did not receive just and legal relief, he received no
              compensation for his home, demolished due to the wrongful
              conduct of defendants, and valued by him and his lender at

      Court of Appeals of Indiana | Memorandum Decision 45A05-1608-PL-1892 | December 30, 2016   Page 6 of 8
              $100,000. This court should reverse the trial court and direct that
              recovery[,] as well as recovery for personal property, and for
              attorney fees for defendants’ fraudulent and oppressive conduct,
              against both defendants.

      Appellant’s Br. at 16 (citation omitted). 2

[9]   At the damages hearing, Appellees presented evidence that Torres’s home

      required much more work than they had been contracted to perform in order to

      avoid being demolished for building code violations. See Tr. at 56 (cross-

      examination of Torres: “Q. Now, the contract you made with Town and

      Country did not include any of the electrical, plumbing, heating, ventilation, or

      rafter work, correct? A. Correct.”). Consequently, the trial court would have

      been well within its discretion to conclude that Appellees’ failure to perform

      under the contract was not the cause in fact of the home’s demolition. 3 The

      same goes for any fraud on Appellees’ part regarding licensure. Furthermore,

      Torres presented no evidence regarding the value of any personal property that

      was damaged as a result of the demolition. Town and Country admitted that it

      owed Torres $10,000 plus interest, and Torres failed to prove by a

      2
       The parties presented conflicting evidence regarding the home’s value. Based on photos, Appellees’
      appraiser valued the home at the time of demolition at $30,000. Torres valued the home at $100,000 based
      on a refinancing that occurred in 2006, almost ten years before the house was demolished for numerous
      building code violations. Had the home’s value become relevant as to damages, the trial court would have
      been free to believe whichever witness it found more credible or make its own determination based on the
      evidence before it.
      3
       A nonbreaching party has a duty to mitigate its damages. Scott-LaRosa v. Lewis, 44 N.E.3d 89, 94 (Ind. Ct.
      App. 2015). There is no evidence that Torres attempted to hire another contractor to perform the work that
      Appellees failed to perform. In fact, Torres admitted that he had not hired a contractor to perform all the
      additional work required to avoid demolition. Tr. at 57.

      Court of Appeals of Indiana | Memorandum Decision 45A05-1608-PL-1892 | December 30, 2016         Page 7 of 8
       preponderance of the evidence that he was entitled to any more than this. 4

       Therefore, we affirm the trial court.

[10]   Affirmed.

       Riley, J., and Altice, J., concur.

       4
        Torres cites no legal basis for his request for attorney’s fees or for holding White personally liable under the
       contract. To the extent he argues that he is entitled to attorney’s fees and damages from White based solely
       on the allegations in his complaint and the granting of his motion for judgment on the pleadings, we note that
       “we need not credit nonfactual assertions and legal conclusions.” Young v. Ind. Dep’t of Corr., 22 N.E.3d 716,
       718 (Ind. Ct. App. 2014), trans. denied (2015).

       Court of Appeals of Indiana | Memorandum Decision 45A05-1608-PL-1892 | December 30, 2016             Page 8 of 8