Court Opinion

ID: 4639204
Source: CourtListenerOpinion
Date Created: 2020-12-03 16:04:45.08761+00
Date Added: 2024-06-11T07:58:54.502915
License: Public Domain

MEMORANDUM DECISION
      Pursuant to Ind. Appellate Rule 65(D),
      this Memorandum Decision shall not be                                         FILED
      regarded as precedent or cited before any                                Dec 03 2020, 8:31 am

      court except for the purpose of establishing                                  CLERK
      the defense of res judicata, collateral                                   Indiana Supreme Court
                                                                                   Court of Appeals
                                                                                     and Tax Court
      estoppel, or the law of the case.

      ATTORNEY FOR APPELLANT                                   ATTORNEY FOR APPELLEE
      Robert R. Faulkner                                       Max E. Fiester
      Evansville, Indiana                                      Terrell, Baugh, Salmon & Born,
                                                               LLP
                                                               Evansville, Indiana

                                                IN THE
          COURT OF APPEALS OF INDIANA

      Matthew P. Apodaca,                                      December 3, 2020
      Appellant-Defendant,                                     Court of Appeals Case No.
                                                               20A-SC-505
              v.                                               Appeal from the
                                                               Warrick Superior Court
      ERA First Advantage Realty,                              The Honorable
      Inc.,                                                    Benjamin R. Aylsworth,
                                                               Magistrate
      Appellee-Plaintiff.
                                                               Trial Court Cause No.
                                                               87D02-1907-SC-1365

      Kirsch, Judge.

[1]   Matthew P. Apodaca (“Apodaca”) appeals the trial court’s ruling that Apodaca

      owes a real estate sale commission to ERA First Advantage Realty, Inc. (“ERA

      Court of Appeals of Indiana | Memorandum Decision 20A-SC-505 | December 3, 2020                   Page 1 of 8
      Realty”) for a purchase of residential real estate that Apodaca negotiated and

      closed on his own. On appeal, Apodaca raises three issues, but we reach only

      one of those issues, which we restate as follows: whether the trial court erred in

      ruling that Apodaca was required to pay a commission to ERA Realty and its

      agent because ERA Realty and its agent failed to fulfill conditions precedent

      under the contract.

[2]   We reverse and remand.

                                 Facts and Procedural History
[3]   In early 2019, Apodaca lived in California, and his job as a field engineer for

      Siemens Corporation involved significant travel. Tr. Vol. 2 at 25. He searched

      the internet for real estate for investment purposes, but once he learned that

      housing in Indiana was much cheaper than housing in California, he began to

      look for homes in Warrick County as a potential home for him and his fiancée

      so he could travel less, and he and his fiancé could settle down and start a

      family. Id. at 26-27. At some point “before March” of 2019, Apodaca

      discovered a residence in Elberfeld, Indiana (“the Elberfeld residence”) that was

      listed as “for sale by owner property.” Id. at 27. Apodaca contacted the owner

      of the Elberfeld residence. Id. At this point, Apodaca had not reached out to

      any southwestern Indiana realtors about the Elberfeld residence. Id.

[4]   On March 6 or 7, 2019, Apodaca contacted Michael Melton (“Melton”), a real

      estate agent for ERA Realty. Id. at 6. Beginning on March 7, 2019, Apodaca

      began sending text messages to Melton about properties that Apodaca wanted

      Court of Appeals of Indiana | Memorandum Decision 20A-SC-505 | December 3, 2020   Page 2 of 8
      to view. Ex. Vol. at 3-6. In none of his communications with Melton did

      Apodaca ask Melton about the Elberfeld residence. Tr. Vol. 2 at 19; Ex. Vol. 3 at

      3-6. At some point before March 16, 2019, Apodaca contacted the owner of the

      Elberfeld residence, and the owner agreed that Apodaca could come view the

      residence on March 16, 2019, at 3:00 p.m. Tr. Vol. 2 at 28.

[5]   Apodaca and Melton met for the first time on the morning of March 16, 2019,

      so they could view several properties in the area later that day. Id. at 10.

      Melton presented Apodaca with a contract. Id. at 11, 20, 22. Several hours

      after Apodaca and Melton started looking at properties, Apodaca told Melton

      for the first time that he had arranged to view the Elberfeld residence on his

      own. Id. at 21. Apodaca and his fiancée viewed that property on their own at

      3:00 p.m. the same day. Id. at 21, 28, 30.

[6]   At some point on March 16, 2019, Apodaca signed a contract with ERA

      Realty. Id. at 11. In pertinent parts, the contract, designated as a “Loyalty

      Agreement – Buyer’s Exclusive Agency Contract”, provided as follows:

              This Contract is entered into and shall commence on 3/16/19 by
              [ERA Realty] and [Apodaca] . . . . [Apodaca] employs [ERA
              Realty] for the purpose of exclusively assisting [Apodaca] to
              locate property described below or other property acceptable to
              [Apodaca], and to negotiate terms and conditions acceptable to
              [Apodaca] for purchase of property.

              ....

              C. [ERA REALTY’S] COMPENSATION:

      Court of Appeals of Indiana | Memorandum Decision 20A-SC-505 | December 3, 2020   Page 3 of 8
              ....

              2 . Commission: In consideration for the services to be
              performed by [ERA Realty], [Apodaca] also agrees to pay [ERA
              Realty] a commission of $ Paid by Seller or Paid by Seller % of
              the total purchase price; however, the total commission paid to
              [ERA Realty] shall not be less than $ Paid by Seller. . . . [ERA
              Realty] shall use [ERA Realty’s] best effort to cause the seller or the
              seller’s agent to satisfy [Apodaca’s] obligation to [ERA Realty].

              The commission shall be due, earned and promptly paid if:

              a. [Apodaca or any other person acting for [Apodaca] or on
              [Apodaca’s] behalf, acquires any real property or interest as
              described herein during the term of this Contract through the
              services of [ERA Realty] or otherwise.

              ....

              F. FURTHER CONDITIONS:

              [Apodaca] will compensate [ERA Realty] 3% on the purchase price of a
              for sale by owner if the seller will not pay [Apodaca’s] agent commission.
              [Apodaca] will call [Melton] prior to scheduling appointments
              with for sale by owners and let [Melton] schedule the
              appointments.

      Appellant’s App. Vol. 2 at 18-19 (emphasis added).

[7]   Apodaca negotiated the terms of the purchase of the Elberfeld residence on his

      own and closed the sale himself. Tr. Vol. 2 at 30. Melton had no role in the

      sale. Id. at 21. At some point before May 20, 2019, Apodaca purchased the

      Court of Appeals of Indiana | Memorandum Decision 20A-SC-505 | December 3, 2020      Page 4 of 8
      Elberfeld residence for $450.000. Id. at 15-16, 21, 30; Appellant’s App. Vol. 2 at

      17; Ex. Vol. 3 at 6. Melton did not receive a commission from Apodaca, which

      under the terms of the contract would have been $13,500.00. Tr. Vol. 2 at 16-17.

      There was no evidence that Melton, or anyone else on behalf of ERA Realty,

      ever attempted to collect any commission from the seller of the Elberfeld

      residence or that the seller refused to pay the commission.

[8]   On July 17, 2019, ERA Realty sued Apodaca by filing a “Statement of Claim.”

      Appellant’s App. Vol. 2 at 10. Even though ERA Realty alleged damages for lost

      commissions of $13,500.00, it agreed to the jurisdictional limit of $6,000.00 by

      filing the claim in the Small Claims Division of Warrick Superior Court. Id.

      On January 30, 2020, the trial court conducted a hearing on ERA Realty’s

      claim. Tr. Vol. 2 at 2. On February 3, 2020, the trial court entered judgment

      against Apodaca, finding and concluding as follows:

              The Court FINDS that the contract executed by . . . [Melton] and
              [Apodaca] on the morning of March 16, 2019 is valid and
              enforceable. [Melton] had performed work in preparation prior
              to that date for [Apodaca’s] benefit and [Apodaca] testified about
              thoughtful discussion and consideration with his spouse prior to
              ultimately deciding to enter into the binding contractual
              agreement and without being subject to duress. As a result of the
              foregoing reasons, the Court ORDERS that the Plaintiff shall
              possess a Judgment against [Apodaca] in the full amount being
              requested, $6,000.00, plus court costs.

      Appellant’s App. Vol. 2 at 8. Apodaca now appeals.

      Court of Appeals of Indiana | Memorandum Decision 20A-SC-505 | December 3, 2020   Page 5 of 8
                                      Discussion and Decision
[9]    Apodaca argues that the trial court erred in finding that he was liable under the

       contract to pay a commission to Melton because he maintains that Melton was

       entitled to a commission under the contract only if Melton fulfilled conditions

       precedent in the contract. In addressing Apodaca’s claim, we will assume

       without deciding that Apodaca would owe Melton the commission if Melton

       fulfilled the conditions precedent in the contract.

[10]   When a trial court enters findings of fact and conclusions of law, findings

       control only as to the issues they cover, and a general judgment standard

       controls as to issues upon which there were no findings. Jernas v. Gumz, 53

       N.E.3d 434, 443 (Ind. Ct. App. 2016), trans. denied. A general judgment entered

       with findings will be affirmed if it can be sustained on any legal theory

       supported by the evidence. Id. We review facts from a bench trial under the

       clearly erroneous standard and thus defer to the trial court’s opportunity to

       assess witness credibility. Branham v. Varble, 952 N.E.2d 744, 746 (Ind. 2011).

       This deference is “particularly important in small claims actions, where trials

       are informal, ‘with the sole objective of dispensing speedy justice’ between

       parties according to the rules of substantive law.” Id. (quoting City of Dunkirk

       Water & Sewage Dep’t v. Hall, 657 N.E.2d 115, 116 (Ind. 1995)). “Interpretation

       of a contract presents a question of law.” Jernas, 53 N.E.3d at 443. “We review

       questions of law de novo and owe no deference to the trial court’s legal

       conclusions.” Id.

       Court of Appeals of Indiana | Memorandum Decision 20A-SC-505 | December 3, 2020   Page 6 of 8
[11]   In arguing the contract required Melton to fulfill conditions precedent before

       being entitled to a commission, Apodaca points to section C2 and section F of

       the contract. In pertinent part, section C2 provides:

               Commission: In consideration for the services to be performed
               by [ERA Realty], [Apodaca] also agrees to pay [ERA Realty] a
               commission of $ Paid by Seller or Paid by Seller % of the total
               purchase price; however, the total commission paid to [ERA
               Realty] shall not be less than $ Paid by Seller. . . . [ERA Realty]
               shall use [ERA Realty’s] best effort to cause the seller or the seller’s agent
               to satisfy [Apodaca’s] obligation to [ERA Realty].

       Appellant’s App. Vol. 2 at 18 (emphasis added). Section F provides:

               [Apodaca] will compensate ERA Realty 3% on the purchase price of a for
               sale by owner if the seller will not pay [Apodaca’s] agent commission.
               [Apodaca] will call [Melton] prior to scheduling appointments
               with for sale by owners and let [Melton] schedule the
               appointments.

       Id. at 19 (emphasis added).

[12]   Apodaca contends that there was no evidence before the trial court that Melton

       made any effort to cause the seller to pay any obligation for a commission that

       Apodaca may have owed Melton. Apodaca also claims there is no evidence

       that the seller refused to pay the commission. Thus, he claims the trial court

       erred as a matter of law in ruling that Apodaca was required to pay a

       commission to Melton.

       Court of Appeals of Indiana | Memorandum Decision 20A-SC-505 | December 3, 2020          Page 7 of 8
[13]   We agree with Apodaca. “Under contract law, a condition precedent is a

       condition that must be performed before the agreement of the parties becomes a

       binding contract or that must be fulfilled before the duty to perform a specific

       obligation arises.” Ind. State Highway Comm’n v. Curtis, 704 N.E.2d 1015, 1018

       (Ind. 1998). “As a general rule, an express condition must be fulfilled or no

       liability can arise on the promise that the condition qualifies.” Id. Here, the

       contract required Melton to make “best effort to cause the Seller . . . to satisfy

       [Apodaca’s] obligation to [Melton].” Appellant’s App. Vol. 2 at 18. Under the

       contract, Apodaca was not liable for the commission unless the seller “[would]

       not pay the . . . commission.” Id. at 19. There is no evidence that Melton or

       any other person on behalf of ERA Realty made such efforts or that the seller

       refused to pay the commission. Therefore, the evidence is undisputed that

       Melton and ERA Realty failed to fulfill conditions precedent to collection of the

       commission. Thus, the trial court erred as a matter of law in finding that

       Apodaca was required to pay the commission to Melton for Apodaca’s

       purchase of the Elberfeld residence. Accordingly, we reverse the trial court and

       direct it on remand to enter judgment for Apodaca on ERA Realty’s Statement

       of Claim.

[14]   Reversed and remanded.

       Pyle, J., and Tavitas, J., concur.

       Court of Appeals of Indiana | Memorandum Decision 20A-SC-505 | December 3, 2020   Page 8 of 8