Court Opinion

ID: 4016134
Source: CourtListenerOpinion
Date Created: 2016-07-15 16:04:34.574818+00
Date Added: 2024-06-11T14:44:46.847087
License: Public Domain

MEMORANDUM DECISION
      Pursuant to Ind. Appellate Rule 65(D),                                    FILED
      this Memorandum Decision shall not be                                 Jul 15 2016, 9:16 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
      William Perry McCall, III
      Mosley Bertrand and McCall
      Jeffersonville, Indiana

                                                 IN THE
          COURT OF APPEALS OF INDIANA

      Pinnacle Properties                                       July 15, 2016
      Development Group, LLC,                                   Court of Appeals Case No.
      Appellant-Defendant,                                      10A01-1512-SC-2275
                                                                Appeal from the Clark Circuit
              v.                                                Court
                                                                The Honorable Kenneth R.
      David Daily,                                              Abbott, Magistrate
      Appellee-Plaintiff.                                       Trial Court Cause No.
                                                                10C03-1507-SC-1153

      Crone, Judge.

                                        Statement of the Case
[1]   Pinnacle Properties Development Group, LLC (“Pinnacle”) appeals a $752.37

      judgment in favor of residential tenant David Daily in his small claims action

      Court of Appeals of Indiana | Memorandum Decision 10A01-1512-SC-2275 | July 15, 2016          Page 1 of 10
      for breach of contract. 1 On appeal, Pinnacle asserts that the trial court erred

      when it concluded that Pinnacle breached its contract with Daily and also that

      the court abused its discretion in awarding Daily certain damages. Finding no

      error or abuse of discretion, we affirm.

                                    Facts and Procedural History
[2]   On October 16, 2014, Daily executed a Lease Agreement (“the Lease”) with

      Pinnacle to rent an apartment located in Jeffersonville. Prior to executing the

      Lease, Daily had an opportunity to inspect the apartment, and he had an

      opportunity to read the Lease. The Lease provided, in relevant part:

               9.       Alterations and Maintenance of Leased Premises

                                                     ***

               B. Tenant shall immediately notify Landlord, in writing, of any
               damage to the Leased Premises.

               C. Landlord, within a reasonable time after written notice from
               Tenant of the need therefore, and subject to Tenant’s obligation
               to make the Leased Premises available as set out above, shall

      1
        We note that Pinnacle failed to submit an appendix on appeal which presumably would have included a
      copy of Daily’s small claims complaint. Indiana Appellate Rule 49(B) states that a party’s “failure to include
      any item in an Appendix shall not waive any issue or argument.” Even so, Appellate Rule 49(A) clearly
      contemplates that an appendix will be filed: “The appellant shall file its Appendix with its appellant’s brief.”
      (Emphasis added.) Similarly, Appellate Rule 50(A)(1) reads, “The purpose of an Appendix in civil appeals
      ... is to present the Court with copies of only those parts of the record on appeal that are necessary for the
      Court to decide the issues presented.” In addition to the chronological case summary, appealed order,
      pleadings, and various other documents, Rule 50(A)(2) requires that the appendix include “other documents
      from the Clerk’s Record in chronological order that are necessary for resolution of the issues raised on
      appeal[.]”

      Court of Appeals of Indiana | Memorandum Decision 10A01-1512-SC-2275 | July 15, 2016                Page 2 of 10
        make all repairs necessary to maintain the exterior and structural
        walls, structural floors (excluding floor coverings), HVAC
        systems, foundations, roof, gutters, and exterior downspouts of
        the Leased Premises in the same condition they are now in,
        except to the extent that the acts or omissions of any one of the
        Occupants necessitates such repairs. Tenant shall be responsible
        for the cost of all other repairs not required to be made by
        Landlord to maintain the Leased Premises in at least as good a
        condition as it is now in. . . . Notwithstanding Tenant’s
        obligation for the costs of repairs hereunder, nothing in this
        Lease shall be deemed or construed to constitute a consent to, or
        a request to any party for the performance of, any labor or
        services or the furnishing of any materials or equipment for the
        improvement, alteration, or repairing of the Leased Premises;

                                            ***

        D. Notwithstanding the above, if the Leased Premises is
        damaged by flood, wind, rain, fire, or other destructive act of
        God such that the Leased Premises is uninhabitable for any
        length of time, Landlord shall have ninety (90) days from receipt
        of notice from Tenant within which to repair and restore the
        Leased Premises without terminating this lease, it being agreed
        that Landlord shall not be liable to Occupants for any damage to
        Occupants or Occupant’s property. If a part of the Leased
        Premises shall be damaged as mentioned above, but not so as to
        render the entire Leased Premises uninhabitable, the Monthly
        Rent shall abate in proportion to that part of the Leased Premises
        which is uninhabitable. If the damage to the Leased Premises
        shall be so extensive as to render the entire Leased Premises
        wholly uninhabitable, the Monthly Rent shall cease from the
        time the Landlord is notified, in writing, of such damages until
        the Leased Premises is restored to a habitable condition; and,
        after the Leased Premises are so restored, the Monthly Rent shall
        begin to accrue again and be payable as before the damage.

Court of Appeals of Indiana | Memorandum Decision 10A01-1512-SC-2275 | July 15, 2016   Page 3 of 10
      Daily’s Ex. 3 at 7-8. In addition to the written Lease, the record indicates that

      Pinnacle provided Daily with a phone number to call in the event of an

      emergency.

[3]   From the date of the execution of the Lease in October 2014 to June 2015,

      Daily did not experience any incidents of flooding in the leased premises.

      However, beginning on June 26, 2015, Daily experienced substantial periodic

      flooding through the patio door of the leased premises. The flooding happened

      on June 26, July 2, July 12, and July 14. After each incident of flooding, Daily

      called Pinnacle’s emergency telephone number to report the flooding. On June

      26, he did not reach a live person at the emergency number so he left a voice

      mail message informing Pinnacle of the flooding. Daily received no response to

      that message. Daily borrowed a wet/dry vacuum and removed thirty gallons of

      water from the leased premises on June 26.

[4]   On July 2, Daily again called Pinnacle’s emergency telephone number, and he

      reported the second flooding. The person who answered the telephone told

      Daily that there was nothing Pinnacle could do about the flooding, but that she

      would “send someone out” to the premises. Tr. at 38. However, no one from

      Pinnacle ever came to the leased premises. Daily removed twelve gallons of

      water from the premises with a borrowed wet/dry vacuum.

[5]   On July 12, Daily again called Pinnacle to report flooding, and he was again

      told that there was nothing Pinnacle could do about the problem but that they

      would send someone over to his unit. Once again no one from Pinnacle came

      Court of Appeals of Indiana | Memorandum Decision 10A01-1512-SC-2275 | July 15, 2016   Page 4 of 10
      to the leased premises, and Daily removed the water on his own with a

      borrowed wet/dry vacuum. He removed forty gallons of water.

[6]   On July 14, Daily personally went to the Pinnacle management office to report

      the fourth flooding. He showed the Pinnacle employee pictures of the flooding.

      Pinnacle put a “work order” into their system but, again, no one from Pinnacle

      came to the leased premises. Id. at 46. This time Daily bought a wet/dry

      vacuum for $53.37 because he believed the flooding would continue without

      any remedial action from Pinnacle. Daily removed twenty-five gallons of water

      from the leased premises on July 14.

[7]   Daily continued to live in the leased premises. However, on July 22, Daily filed

      a complaint against Pinnacle in small claims court, seeking damages in the

      amount of $3,330.68. Following a hearing, the trial court entered judgment for

      Daily in the amount of $699 for the rent Daily had paid for the month of July

      and $53.37 for the cost of the wet/dry vacuum Daily had purchased, plus court

      costs and post-judgment interest. This appeal ensued.

                                     Discussion and Decision
[8]   Initially we note that Daily has failed to file an appellee’s brief. Therefore, the

      trial court’s decision may be reversed upon a showing of prima facie error. Ind.

      Appellate Rule 45(D); Trinity Homes, LLC v. Fang, 848 N.E.2d 1065, 1068 (Ind.

      2006) (holding that, when the appellee has failed to submit an answer brief, the

      court on appeal need not undertake the burden of developing an argument on

      Court of Appeals of Indiana | Memorandum Decision 10A01-1512-SC-2275 | July 15, 2016   Page 5 of 10
       the appellee’s behalf; rather, the court on appeal will reverse the trial court’s

       judgment if the appellant’s brief presents a case of prima facie error).

[9]    Our standard of review in a small-claims court case is clear:

               Small-claims court judgments are “subject to review as prescribed
               by relevant Indiana rules and statutes.” Ind. Small Claims Rule
               11(A). Under Indiana Trial Rule 52(A), the clearly erroneous
               standard applies to appellate review of facts determined in a
               bench trial with due regard given to the opportunity of the trial
               court to assess witness credibility. This deferential standard of
               review is particularly important in small-claims actions, where
               trials are designed to speedily dispense justice by applying
               substantive law between the parties in an informal setting.
               Berryhill v. Parkview Hosp., 962 N.E.2d 685, 689 (Ind. Ct. App.
               2012). But this deferential standard does not apply to the
               substantive rules of law, which are reviewed de novo just as they
               are in appeals from a court of general jurisdiction. Id.

       Vance v. Lozano, 981 N.E.2d 554, 557-58 (Ind. Ct. App. 2012).

[10]   In awarding Daily $699 for the rent he had paid in July, the trial court

       essentially concluded that Pinnacle breached its Lease with Daily by failing to

       repair the damage from the flooding. Pinnacle claims this was error. Indiana

       courts have recognized the contractual nature of leases and the applicability of

       the law of contracts to leases. See, e.g., Murat Temple Ass’n, Inc. v. Live Nation

       Worldwide, Inc., 953 N.E.2d 1125, 1129 (Ind. Ct. App. 2011), trans. denied. A

       lease is interpreted in the same way as any other contract. Indiana Port Comm'n

       v. Consol. Grain and Barge Co., 701 N.E.2d 882, 887 (Ind. Ct. App. 1998), trans.

       denied (1999). The rules of construction of a contract are well-settled:

       Court of Appeals of Indiana | Memorandum Decision 10A01-1512-SC-2275 | July 15, 2016   Page 6 of 10
               The ultimate goal of any contract interpretation is to determine
               the intent of the parties at the time that they made the agreement.
               First Fed. Sav. Bank of Indiana v. Key Mkts., Inc., 559 N.E.2d 600,
               603 (Ind. 1990). We begin with the plain language of the
               contract, reading it in context and, whenever possible, construing
               it so as to render each word, phrase, and term meaningful,
               unambiguous, and harmonious with the whole. Trustcorp Mortg.
               Co. v. Metro Mortg. Co., Inc., 867 N.E.2d 203, 213 (Ind. Ct. App.
               2007). “A contract is ambiguous if a reasonable person would
               find the contract subject to more than one interpretation.”
               Fackler v. Powell, 891 N.E.2d 1091, 1096 (Ind. Ct. App. 2008)[,
               trans. denied (2009)]. If we find ambiguous terms or provisions in
               the contract, “we will construe them to determine and give effect
               to the intent of the parties at the time they entered into the
               contract.” George S. May Int’l. Co. v. King, 629 N.E.2d 257, 260
               (Ind. Ct. App. 1994) (internal citations omitted), trans. denied.

       Citimortgage, Inc. v. Barabas, 975 N.E.2d 805, 813 (Ind. 2012).

[11]   Pinnacle claims that the trial court ignored the provisions in the Lease which

       required Daily to give Pinnacle written notice of the flooding and which then

       allowed Pinnacle ninety days within which to make the necessary repairs and

       restore the property. See Daily’s Ex. 3 at 8. While we do not necessarily agree

       with Pinnacle that Daily was required to give written notice to Pinnacle when

       the flooding rendered the leased premises only partially uninhabitable as

       contemplated by Paragraph 9(D) of the Lease, we need not reach that issue. 2

       2
        Paragraph 9(D) of the Lease provides in relevant part that if “part of the Leased Premises shall be damaged
       as mentioned above, but not so as to render the entire Leased Premises uninhabitable, the Monthly Rent shall
       abate in proportion to that part of the Leased Premises which is uninhabitable.” See Daily’s Ex. 3 at 8.

       Court of Appeals of Indiana | Memorandum Decision 10A01-1512-SC-2275 | July 15, 2016           Page 7 of 10
[12]   It is well-established that we will affirm a general judgment entered in a small

       claims case if it can be sustained on any legal theory supported by the evidence.

       Collections, Inc. v. Wolfe, 818 N.E.2d 14, 16 (Ind. Ct. App. 2004). Even if the

       plain language of the Lease required that Daily give written notice to Pinnacle

       when the flooding rendered the leased premises only partially uninhabitable,

       the evidence is undisputed that Pinnacle had actual notice of the flooding, and

       therefore we would find that Pinnacle is equitably estopped from asserting lack

       of written notice as a defense to its breach of the Lease. Our supreme court has

       stated, “Estoppel is a judicial doctrine sounding in equity. Although variously

       defined, it is a concept by which one's own acts or conduct prevents the

       claiming of a right to the detriment of another party who was entitled to and did

       rely on the conduct.” Brown v. Branch, 758 N.E.2d 48, 51-52 (Ind. 2001). “The

       doctrine of estoppel springs from equitable principles and is designed to aid in

       the administration of justice where, without its aid, injustice might result.”

       Lockett v. Planned Parenthood of Ind., Inc., 42 N.E.3d 119, 136 (Ind. Ct. App.

       2015), trans. denied (2016).

[13]   There is no question that injustice would result if Pinnacle were permitted to

       avoid refunding Daily the rent paid during the period the premises were

       partially uninhabitable simply because he did not give Pinnacle written notice

       of the flooding. Daily repeatedly gave Pinnacle actual notice of the flooding.

       After each flooding incident, he called the specific emergency number provided

       to him by Pinnacle. He left a message on the first occasion and, on the second

       occasion, he actually spoke to a live person who said that she would “send

       Court of Appeals of Indiana | Memorandum Decision 10A01-1512-SC-2275 | July 15, 2016   Page 8 of 10
       someone out.” Tr. at 38. On yet another occasion when he called the

       emergency number, he spoke to another person who promised to send someone

       out to his premises. To Daily’s obvious detriment, Pinnacle gave Daily false

       assurances that it would take care of the problem. Daily’s reliance on

       Pinnacle’s assurance was unquestionably justified. We can hardly imagine a

       more appropriate application of the equitable estoppel doctrine. The trial court

       did not err in concluding that Pinnacle breached the Lease and in awarding

       Daily $699 for the rent paid during the period of partial uninhabitability.

[14]   As a final matter, Pinnacle challenges the trial court’s decision to also award

       Daily $53.37 for the cost of the wet/dry vacuum he purchased. It is well settled

       that a party injured by a breach of contract is limited in his recovery to the loss

       actually suffered, and he may not be placed in a better position than he would

       have enjoyed had the breach not occurred. Hawa v. Moore, 947 N.E.2d 421, 427

       (Ind. Ct. App. 2011). However, a party injured by a breach of contract may

       recover consequential damages, namely damages that flow naturally and

       probably from the breach and were contemplated by the parties when the

       contract was made. Rockford Mut. Ins. Co. v. Pirtle, 911 N.E.2d 60, 67 (Ind. Ct.

       2009), trans. denied (2010). Our review of a damages award is limited, and we

       will reverse an award only when it is not within the scope of the evidence before

       the finder of fact. Sheek v. Mark A. Morin Logging, Inc., 993 N.E.2d 280, 287

       (Ind. Ct. App. 2013), trans. denied (2014).

[15]   Daily testified that after having to scramble around and borrow a wet/dry

       vacuum on multiple occasions to remove the gallons upon gallons of water

       Court of Appeals of Indiana | Memorandum Decision 10A01-1512-SC-2275 | July 15, 2016   Page 9 of 10
       from his apartment when Pinnacle would not, he finally purchased a wet/dry

       vacuum so that he could mitigate the damage caused by the continued flooding.

       Clearly, the purchase of the vacuum was a consequential damage arising from

       Pinnacle’s breach of the Lease. Accordingly, the trial court did not abuse its

       discretion in awarding Daily $53.37 for the cost of the vacuum. The judgment

       of the trial court is affirmed.

[16]   Affirmed.

       Najam, J., and Robb, J., concur.

       Court of Appeals of Indiana | Memorandum Decision 10A01-1512-SC-2275 | July 15, 2016   Page 10 of 10