ILNews

Forged agreement presents question of fact

Back to TopCommentsE-mailPrintBookmark and Share

A company that forged a former employee's non-compete contract and later sued and settled with another company over that false document isn't entitled to summary judgment in a new suit brought by the other company after it learned the document was forged, ruled the Indiana Court of Appeals.

Tru-Cal Inc. hired a former employee of competitor Conrad Kacsik Instrument Systems Inc. shortly after he quit. Conrad filed suit against Tru-Cal and the employee, Steven Sulzbach, basing most of its claims on an employment agreement he allegedly signed while working for Conrad that said he wouldn't work for a competitor for two years. After Tru-Cal learned of the litigation in an Ohio court and the non-compete agreement, it settled the suit. Sulzbach maintained he never remembered signing the document. The settlement contained mutual releases and an integration clause.

About a year later, Tru-Cal learned the Sulzbach's signature on the document was most likely forged because a former executive of Conrad said no employees signed non-compete agreements. It filed the instant action against Conrad seeking treble damages and attorney fees pursuant to the Indiana Crime Victims Relief Act, alleged the Ohio litigation initiated by Conrad constituted abuse of process, and Tru-Cal was entitled to rescission of the settlement agreement, attorney fees, and punitive damages. Hamilton Superior Court granted summary judgment in favor of Conrad on all of Tru-Cal's claims.

In the appeal, Tru-Cal v. Conrad, No. 29A04-0809-CV-511, the essence of the dispute between the companies appears to center on whether Tru-Cal rightfully or reasonably relied upon Conrad's forged documents and the Ohio litigation in filing its suit, wrote Judge Ezra Friedlander. Conrad argues Tru-Cal couldn't reasonably rely upon these false representations because of the integration clause in the settlement agreement, which disclaimed reliance on any outside statement or representation.

The Court of Appeals found Prall v. Indiana National Bank, 627 N.E.2d 1374 (Ind. Ct. App. 1994), and Circle Ctr. Dev. Co. v. Y/G Ind., L.P., 762 N.E.2d 176 (Ind. Ct. App. 2002), to be factually distinguishable from the instant case.

"Rather, the alleged fraud here involves a forged employment agreement that was filed in a court of law, along with a complaint and an affidavit that represented to the Ohio court that said agreement was valid," wrote the judge. "Assuming, as we must, that the employment agreement was forged, the Ohio litigation initiated by CKI was therefore a sham."

In the instant case, there's no doubt the fraud directly induced the execution of the settlement agreement or at least contributed to it as a cause, wrote Judge Friedlander. Tru-Cal presented a material issue of fact as to whether it had the right to rely on the employment agreement and other related representations made in the Ohio litigation.

The trial court also erred in granting summary judgment regarding Tru-Cal's Indiana Crime Victims Relief Act claim because there is a question of fact as to whether the conduct and or the result of any of the alleged offenses occurred in Indiana.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in Indiana Lawyer editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Indiana State Bar Association

Indianapolis Bar Association

Evansville Bar Association

Allen County Bar Association

Indiana Lawyer on Facebook

facebook
ADVERTISEMENT
Subscribe to Indiana Lawyer
  1. So that none are misinformed by my posting wihtout a non de plume here, please allow me to state that I am NOT an Indiana licensed attorney, although I am an Indiana resident approved to practice law and represent clients in Indiana's fed court of Nth Dist and before the 7th circuit. I remain licensed in KS, since 1996, no discipline. This must be clarified since the IN court records will reveal that I did sit for and pass the Indiana bar last February. Yet be not confused by the fact that I was so allowed to be tested .... I am not, to be clear in the service of my duty to be absolutely candid about this, I AM NOT a member of the Indiana bar, and might never be so licensed given my unrepented from errors of thought documented in this opinion, at fn2, which likely supports Mr Smith's initial post in this thread: http://caselaw.findlaw.com/us-7th-circuit/1592921.html

  2. When I served the State of Kansas as Deputy AG over Consumer Protection & Antitrust for four years, supervising 20 special agents and assistant attorneys general (back before the IBLE denied me the right to practice law in Indiana for not having the right stuff and pretty much crushed my legal career) we had a saying around the office: Resist the lure of the ring!!! It was a take off on Tolkiem, the idea that absolute power (I signed investigative subpoenas as a judge would in many other contexts, no need to show probable cause)could corrupt absolutely. We feared that we would overreach constitutional limits if not reminded, over and over, to be mindful to not do so. Our approach in so challenging one another was Madisonian, as the following quotes from the Father of our Constitution reveal: The essence of Government is power; and power, lodged as it must be in human hands, will ever be liable to abuse. We are right to take alarm at the first experiment upon our liberties. I believe there are more instances of the abridgement of freedom of the people by gradual and silent encroachments by those in power than by violent and sudden usurpations. Liberty may be endangered by the abuse of liberty, but also by the abuse of power. All men having power ought to be mistrusted. -- James Madison, Federalist Papers and other sources: http://www.constitution.org/jm/jm_quotes.htm RESIST THE LURE OF THE RING ALL YE WITH POLITICAL OR JUDICIAL POWER!

  3. My dear Mr Smith, I respect your opinions and much enjoy your posts here. We do differ on our view of the benefits and viability of the American Experiment in Ordered Liberty. While I do agree that it could be better, and that your points in criticism are well taken, Utopia does indeed mean nowhere. I think Madison, Jefferson, Adams and company got it about as good as it gets in a fallen post-Enlightenment social order. That said, a constitution only protects the citizens if it is followed. We currently have a bevy of public officials and judicial agents who believe that their subjectivism, their personal ideology, their elitist fears and concerns and cause celebs trump the constitutions of our forefathers. This is most troubling. More to follow in the next post on that subject.

  4. Yep I am not Bryan Brown. Bryan you appear to be a bigger believer in the Constitution than I am. Were I still a big believer then I might be using my real name like you. Personally, I am no longer a fan of secularism. I favor the confessional state. In religious mattes, it seems to me that social diversity is chaos and conflict, while uniformity is order and peace.... secularism has been imposed by America on other nations now by force and that has not exactly worked out very well.... I think the American historical experiment with disestablishmentarianism is withering on the vine before our eyes..... Since I do not know if that is OK for an officially licensed lawyer to say, I keep the nom de plume.

  5. I am compelled to announce that I am not posting under any Smith monikers here. That said, the post below does have a certain ring to it that sounds familiar to me: http://www.catholicnewworld.com/cnwonline/2014/0907/cardinal.aspx

ADVERTISEMENT