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Judges uphold contempt order against attorney

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A Morgan Circuit judge had jurisdiction to order a Unionville attorney to pay $75,000 to the county clerk after finding the attorney in contempt, the Indiana Court of Appeals ruled Tuesday.

In the case In Re: The Order of Contempt Against Craig Benson, Martinsville Depot, Inc., and SBS Enterprises, Inc. v. Co-Alliance, LLP, No. 55A04-1010-CC-646, Craig Benson appealed the trial court’s finding that he was in contempt of court orders by distributing funds in 2010 that were to be held in his account. Martinsville Depot Inc. and SBS Enterprises were represented by Benson in a complaint filed by Co-Alliance seeking money for fuel that it had provided to Depot. The court ordered that proceeds from sales of assets from the defendants should be held until the court decides what should happen to those proceeds.

A sale happened in February 2010, and funds were deposited into Benson’s escrow account. Despite the court order, Benson distributed $75,000 to creditors and himself for attorney fees. After the distributions, Benson filed a motion for partial relief to be allowed to distribute some funds, but that was denied.

Several months later, SBS and Depot filed for protection under Chapter 7 of the United States Bankruptcy Code and proceedings against SBS and Depot were stayed by the trial court. Co-Alliance then filed an unverified motion for contempt against Benson, and later filed a similar amended verified motion for contempt. The trial court found Benson in contempt and ordered he pay the $75,000 to the Morgan County Clerk and that he be jailed until he paid the money. He paid the amount owed to the clerk.

Benson attempted to have the contempt petition dismissed because the original contempt petition was unverified. It appears the parties decided to have the trial judge rule on the original motion, but even if the court erred by proceeding on this motion, any error didn’t affect Benson’s substantial rights, ruled the appellate court. As a result of the amended contempt motion, the trial court had before it almost identical verified allegations against Benson, so the essential purpose of the verification requirement was satisfied, wrote Judge Michael Barnes.

Also, the trial court did have subject matter jurisdiction to order the payment of $75,000 for contempt even though the bankruptcy court had previously stayed the proceedings. The money the trial court ordered him to pay wasn’t proceeds from the defendants’ sale and property of the bankruptcy estate, but was Benson’s personal money and it was damages resulting from his contempt. The funds at issue here aren’t subject to the bankruptcy court’s jurisdiction, wrote the judge.

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  1. Can I get this form on line,if not where can I obtain one. I am eligible.

  2. What a fine example of the best of the Hoosier tradition! How sad that the AP has to include partisan snark in the obit for this great American patriot and adventurer.

  3. Why are all these lawyers yakking to the media about pending matters? Trial by media? What the devil happened to not making extrajudicial statements? The system is falling apart.

  4. It is a sad story indeed as this couple has been only in survival mode, NOT found guilty with Ponzi, shaken down for 5 years and pursued by prosecution that has been ignited by a civil suit with very deep pockets wrenched in their bitterness...It has been said that many of us are breaking an average of 300 federal laws a day without even knowing it. Structuring laws, & civilForfeiture laws are among the scariest that need to be restructured or repealed . These laws were initially created for drug Lords and laundering money and now reach over that line. Here you have a couple that took out their own money, not drug money, not laundering. Yes...Many upset that they lost money...but how much did they make before it all fell apart? No one ask that question? A civil suit against Williams was awarded because he has no more money to fight...they pushed for a break in order...they took all his belongings...even underwear, shoes and clothes? who does that? What allows that? Maybe if you had the picture of him purchasing a jacket at the Goodwill just to go to court the next day...his enemy may be satisfied? But not likely...bitterness is a master. For happy ending lovers, you will be happy to know they have a faith that has changed their world and a solid love that many of us can only dream about. They will spend their time in federal jail for taking their money from their account, but at the end of the day they have loyal friends, a true love and a hope of a new life in time...and none of that can be bought or taken That is the real story.

  5. Could be his email did something especially heinous, really over the top like questioning Ind S.Ct. officials or accusing JLAP of being the political correctness police.

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