ILNews

Court allows relief under Crime Victims Statute

Jennifer Nelson
January 1, 2008
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Contract provisions that exempt a party from liability under the Indiana Crime Victims Statute are void when the party violates public policy, the Indiana Court of Appeals ruled Friday.

In The State Group Industrial (USA) Unlimited v. Murphy & Associates Industrial Services, No. 82A04-0703-CV-158, State Group appealed the trial court judgment denying the company's request for relief under Indiana Code 34-24-3-1, the Crime Victims Statute. The trial court awarded State Group actual damages, but denied relief under the statute based on a contract provision between State Group and Murphy & Associates (M&A).

M&A prepared an estimate for State Group regarding supplying materials for a control system project in Texas in which State Group was the prime contractor. The project aimed to ensure the safety of a community's drinking water. At a meeting between the two companies, M&A confirmed that salinity probes, which are necessary components for the control system, would be part of the contract and M&A would provide engineering for the start-up process.

Once M&A began submitting invoices to State Group for payment, there were discrepancies between the invoices and the original contract. The two companies did not discuss changing the terms of the contract and M&A misrepresented to State Group that it had paid for materials in full and no other party had claim on the materials for the control system.

State Group paid the invoices in full, but did not receive the salinity probes and necessary cabling. State Group was forced to hire a replacement subcontractor to obtain the materials, including necessary software, which M&A was supposed to provide. M&A filed a complaint against State Group alleging breach of contract. State Group counterclaimed, saying that M&A breached the contract. State Group also claimed fraud, and sought damages under the Crime Victims Statute.

The trial court found M&A breached the contract and knowingly made numerous false or misleading statements, and awarded State Group actual damages.

The trial court concluded M&A violated I.C. 35-43-5-3, committing deception, which allowed State Group to bring an action under the Crime Victims Statute. The issue of whether a contract provision can exempt a party from liability under this statute for violating public policy is something Indiana hasn't ruled on, wrote Judge Margret Robb. Other states have ruled that a party may not contract against liability for intentional tortuous acts.

Other states' courts have ruled public policy violations are not included in contract liability protection clauses when the conduct is intentional, a matter of gross negligence, or willful and wanton misconduct. The Indiana appellate court is more likely to hold an exculpatory clause to be against public policy when it affects public interest in utilities, she wrote in a footnote.

Recovery under the Crime Victims Statute is not based on breach of contract, but must be predicated on an independent tort, wrote Judge Robb. Under Indiana law, a contract may release a party from liability for damages caused by its own negligence, but these clauses must specifically and explicitly refer to the negligence of the party seeking release from liability, Avant v. Cmty. Hosp., 826 N.E.2d 7, 10 (Ind. Ct. App. 2005).

Release from liability cannot happen if the contract provisions are phrased in general terms. The indemnification clause in the contract between State Group and M&A was not specific, as it did not refer to the criminal or fraudulent conduct on the part of M&A, thus M&A was not protected from liability under the Crime Victims Statute.

The appellate court remanded the case to the trial court with instructions that it exercise its discretion in determining whether to award damages and the amount of any damages.
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  1. A traditional parade of attorneys? Really Evansville? Y'all need to get out more. When is the traditional parade of notaries? Nurses? Sanitation workers? Pole dancers? I gotta wonder, do throngs of admiring citizens gather to laud these marching servants of the constitution? "Show us your billing records!!!" Hoping some video gets posted. Ours is not a narcissistic profession by any chance, is it? Nah .....

  2. My previous comment not an aside at court. I agree with smith. Good call. Just thought posting here a bit on the if it bleeds it leads side. Most attorneys need to think of last lines of story above.

  3. Hello everyone I'm Gina and I'm here for the exact same thing you are. I have the wonderful joy of waking up every morning to my heart being pulled out and sheer terror of what DCS is going to Throw at me and my family today.Let me start from the !bebeginning.My daughter lost all rights to her 3beautiful children due to Severe mental issues she no longer lives in our state and has cut all ties.DCS led her to belive that once she done signed over her right the babies would be with their family. We have faught screamed begged and anything else we could possibly due I hired a lawyer five grand down the drain.You know all I want is my babies home.I've done everything they have even asked me to do.Now their saying I can't see my grandchildren cause I'M on a prescription for paipain.I have a very rare blood disease it causes cellulitis a form of blood poisoning to stay dormant in my tissues and nervous system it also causes a ,blood clotting disorder.even with the two blood thinners I'm on I still Continue to develop them them also.DCS knows about my illness and still they refuse to let me see my grandchildren. I Love and miss them so much Please can anyone help Us my grandchildren and I they should be worrying about what toy there going to play with but instead there worrying about if there ever coming home again.THANK YOU DCS FOR ALL YOU'VE DONE. ( And if anyone at all has any ideals or knows who can help. Please contact (765)960~5096.only serious callers

  4. He must be a Rethuglican, for if from the other side of the aisle such acts would be merely personal and thus not something that attaches to his professional life. AND ... gotta love this ... oh, and on top of talking dirty on the phone, he also, as an aside, guess we should mention, might be important, not sure, but .... "In addition to these allegations, Keaton was accused of failing to file an appeal after he collected advance payment from a client seeking to challenge a ruling that the client repay benefits because of unreported income." rimshot

  5. I am not a fan of some of the 8.4 discipline we have seen for private conduct-- but this was so egregious and abusive and had so many points of bad conduct relates to the law and the lawyer's status as a lawyer that it is clearly a proper and just disbarment. A truly despicable account of bad acts showing unfit character to practice law. I applaud the outcome.

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