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Doctrine of res judicata stops property owner’s motion

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A property owner’s attempt to file a separate action against a court-appointed receiver was derailed by the Indiana Court of Appeals under the doctrine of res judicata.

The case originated from a foreclosure action filed by PNC Bank against Luxury Townhomes, LLC and LP XXIV, LLC. As part of the foreclosure, the trial court appointed Kenneth Polsinelli of McKinley Properties, Inc. as the receiver.

After PNC and Luxury reached a settlement, they filed a joint motion requesting dismissal of the foreclosure action, and a separate motion asking that Polsinelli be discharged and the receivership estate be settled.  

Luxury also filed a request for leave to join and assert claims against Polsinelli and McKinley.

At an evidentiary hearing to review Polsinelli’s final report, Luxury objected to the report. The landlord, claiming Polsinelli had negligently performed his duties, wanted permission to recover both his bond and additional funds through a separate negligence action.

The trial court found Polsinelli did not act negligently. It accepted the final report, denied Luxury’s motion for leave, discharged Polsinelli and his bond, and closed the receivership estate.

Luxury then filed a motion to correct error which the trial court denied.

In Luxury Townhomes, LLC/LP XXIV, LLC, et al. v. McKinley Properties, Inc. and Kenneth Polsinelli, 49A05-1210-MF-514, the COA affirmed the denial of Luxury’s motion to correct error. It ruled the trial court’s actions in closing the receivership estate precluded a later determination that Polsinelli acted negligently.

 “Because the trial court has already made a factual determination on Polsinelli’s performance as receiver after a three-day evidentiary hearing and has discharged Polsinelli and closed the receivership estate, we conclude that any subsequent suit by Luxury regarding issue of whether Polsinelli faithfully carried out his duties as receiver is barred by the issue preclusion branch of the doctrine of res judicata,” Judge Cale Bradford wrote for the court.

 

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  1. Well, maybe it's because they are unelected, and, they have a tendency to strike down laws by elected officials from all over the country. When you have been taught that "Democracy" is something almost sacred, then, you will have a tendency to frown on such imperious conduct. Lawyers get acculturated in law school into thinking that this is the very essence of high minded government, but to people who are more heavily than King George ever did, they may not like it. Thanks for the information.

  2. I pd for a bankruptcy years ago with Mr Stiles and just this week received a garnishment from my pay! He never filed it even though he told me he would! Don't let this guy practice law ever again!!!

  3. Excellent initiative on the part of the AG. Thankfully someone takes action against predators taking advantage of people who have already been through the wringer. Well done!

  4. Conour will never turn these funds over to his defrauded clients. He tearfully told the court, and his daughters dutifully pledged in interviews, that his first priority is to repay every dime of the money he stole from his clients. Judge Young bought it, much to the chagrin of Conour’s victims. Why would Conour need the $2,262 anyway? Taxpayers are now supporting him, paying for his housing, utilities, food, healthcare, and clothing. If Conour puts the money anywhere but in the restitution fund, he’s proved, once again, what a con artist he continues to be and that he has never had any intention of repaying his clients. Judge Young will be proven wrong... again; Conour has no remorse and the Judge is one of the many conned.

  5. Pass Legislation to require guilty defendants to pay for the costs of lab work, etc as part of court costs...

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