7th Circuit Court of Appeals
Civil – Bankruptcy Court Claims/Issue Preclusion
Dawn Marie Adams v. James Gregory Adams
Federal Bankruptcy and District courts wrongly denied a woman’s claim against the estate of her ex-husband and business partner who owed her money after they divorced and unwound a monster-truck business for which she had lent money.
The 7th Circuit Court of Appeals ruled that Judge William T. Lawrence of the District Court for the Southern District of Indiana improperly affirmed a Bankruptcy Court ruling denying Dawn Adams’ petition. Numerous Georgia court rulings said her ex-husband, Greg, owed her at least $74,000. He filed for bankruptcy after the judgments.
“The state courts of Georgia decided three times in three final judgments that Greg still owed money to Dawn after they divorced and unwound their ‘monster truck’ business,” Judge David Hamilton wrote for the panel. “The bankruptcy court heard evidence on the merits of Dawn’s claim, though, and denied it as inequitable.
“We find that the issues concerning the validity of Dawn’s claim were previously adjudicated in the state courts and that the doctrine of issue preclusion prevented the bankruptcy court from rehearing those issues. Accordingly, we reverse and remand for proceedings.”
“Dawn seeks in the bankruptcy only what the (Georgia) court determined she was owed,” Hamilton wrote. “(T)hough Greg Adams had the opportunity to appeal the Georgia state court judgments, he did not avail himself of that opportunity. Instead, he filed for bankruptcy, but that is not a substitute for timely appeals of the state court judgments.
“The doctrine of issue preclusion (collateral estoppel) bars him from using the bankruptcy system to have his defenses reheard despite the state courts’ rejection of those defenses.”
The suit arises from the Southern District, Terre Haute Division, because Dawn Adams relocated to Putnam County, Ind., after the couple divorced. The monster truck in which the couple had invested is known as “Annihilator,” the opinion notes.
Civil – College Search & Suspension/Fourth Amendment/Due Process
Zachary Medlock v. Trustees of Indiana University, et al.
An Indiana University student’s appeal of his suspension after a large marijuana plant and other evidence of illegal drug use were discovered in his dorm room “is near frivolous,” a panel of the 7th Circuit Court of Appeals ruled.
The panel affirmed summary judgment in favor of IU and other defendants. Medlock appealed the ruling of District Judge Tanya Walton Pratt of the Southern District of Indiana alleging that the university violated his Fourth Amendment rights against unlawful search and seizure.
But the panel noted that IU had notified Medlock and other students of pending dorm room inspections for code violations by email a week in advance, and that notice of the inspections had been announced the same day. When resident assistants found marijuana in Medlock’s dorm they notified IU police, who executed a search warrant and counted 89 grams of marijuana, resulting in a felony possession charge.
The opinion notes that “for unexplained reasons the charges were dropped, although there can’t have been any doubt of his guilt.” The panel ruled that students and officers acted reasonably and lawfully after marijuana was discovered in Medlock’s dorm room.
“There is no merit to the due process claim,” Judge Richard Posner wrote for the panel. “The in-your-face flagrancy of Medlock’s violation of university rules (he had plenty of warning of the impending inspection, remember), and of Indiana’s criminal law, required the university to take immediate remedial action if its commitment to its rules, and to legality, was not to be questioned.”
“In short, the case is near frivolous, the decision to sue the two student inspectors offensive, and the most surprising feature of the entire episode is the exceptional lenity with which a state university (in a state that does not allow medicinal, let alone recreational, use of marijuana) treated a brazen violator of its rules of conduct and of the criminal law,” Posner wrote.
“But as we noted some years ago, ‘the danger that without the procedural safeguards deemed appropriate in civil and criminal litigation public universities will engage in an orgy of expulsions is slight. The relation of students to universities is, after all, essentially that of customer to seller. … And if we may judge from the happy ending of the marijuana bust for Medlock, the customer is indeed always right.”
Criminal – Wire Fraud/Witness/Evidence
United States of America v. Phillip Rucker
The 7th Circuit Court of Appeals affirmed the decision by the District Court in Hammond preventing a defendant from using an 11-year-old conviction to impeach a testifying co-defendant in a wire fraud case.
Phillip Rucker, Sheila Chandler and Jerry Haymon were indicted by a grand jury with engaging in a mortgage fraud scheme. Rucker was charged with one count of wire fraud for his participation and was later convicted and sentenced to 30 months in prison, one year of supervised release and ordered to pay nearly $74,000 in restitution.
Rucker recruited Leequiter Smith to purchase a property in Gary for $85,000; Haymon led the seller to believe that he would sell the property for $35,000. Chandler completed false documents to support Smith’s loan application and Rucker helped obtain a down payment for Smith from an acquaintance who claimed in a gift letter to be Smith’s brother. For his part in the scheme, Rucker received $10,000.
The issue is whether the District Court abused its discretion in finding that, under the circumstances, the probative value of Chandler’s 2000 prior conviction for thefts of public funds did not substantially outweigh its prejudicial effect.
“Rucker maintains that Chandler’s 2000 conviction for a theft concerning a program receiving federal funds was especially probative because it shows that her trial testimony, that she began lying in 2004, was false. Rucker, however, mischaracterizes Chandler’s testimony,” wrote Judge Frederick L. Kapala of the Northern District of Illinois, who was sitting by designation. “Chandler testified that she began to lie to mortgage lenders on behalf of buyers and to create false documents in 2004, not that she was never dishonest before 2004. As such, Chandler’s 2000 conviction does not have the probative value that Rucker assigns to it.”
He also claimed Chandler’s testimony was the “lynchpin of the government’s case against him.”
“Even giving Rucker the benefit of the doubt and assuming that the jury believed that Rucker truly thought the house was worth $85,000, the disbursement of $20,000 (nearly a quarter of the proceeds of the sale) to himself and Smith after the closing and the $4,000 contribution by Haymon was strong evidence that Rucker knew that fraud was afoot. Therefore, the jury did not need to rely on Chandler’s testimony alone to conclude that Rucker knowingly engaged in this scheme to defraud,” Kapala wrote.
Indiana Tax Court
Tax – Property Tax Assessment/Time Limit to Correct Errors
Joseph & Jeanne Hutcherson v. Robin L. Ward, Hamilton County Assessor
In a ruling that it conceded could “open the floodgates,” the Indiana Tax Court found neither state statute nor regulations provided any time limits for homeowners to file petitions to correct error on their property tax assessments.
The Tax Court reviewed the Petition to Correct Error Statute contained in Indiana Code 6-1.1-15-12 and discovered provisions that gave taxpayers three years to claim a refund had been removed.
The Tax Court denied the assessor’s motion to dismiss and urged the state to include time limitations in the petition statute.
The Hutchersons filed four petitions to correct error for the 2004 through 2007 tax years after they learned they had not been given their homestead deduction. Both the Hamilton County Property Tax Assessment Board of Appeals and the Indiana Board of Tax Review denied the petitions because the documents were filed after the three-year limit.
On appeals before the Tax Court, the county assessor argued the Hutchersons failed to timely file their petitions under the Petition to Correct Error Statute and the Refund Statute, Indiana Code 6-1.1-26.1.
The Tax Court found that when 50 Indiana Administrative Code 4.2-3.12, which promulgated a regulation interpreting the petition statute, was repealed, the time limitation was deleted. And none of the new regulations adopted in 2000 or 2009 included a specific time period for filing a petition to correct error.
Although the Refund Statute does impose a three-year limitation period for filing a claim for a refund, the Tax Court declined to stretch that provision into the petition statute.
“The Court is well aware that this decision has the potential to open the floodgates for petition to correct error appeals by finding, as it must, that no statutory or regulatory time limitation exists after April 1, 2000,” Judge Martha Blood Wentworth wrote. “Moreover, the Court strongly supports the important public policy favoring limitations of claims. … The Court ardently urges the Legislature or the Department of Local Government Finance to act with all haste to provide security against stale claims arising under Indiana Code 6-1.1-15-12.”
Tax – Indiana Board of Tax Review/Agricultural Property Assessment
Vern R. Grabbe v. Carroll County Assessor, Neda K. Duff
Vern R. Grabbe v. Carroll County Assessor, Neda K. Duff
A Carroll County man who owns agricultural property containing hog buildings couldn’t convince the Indiana Tax Court that the Indiana Board of Tax Review erred when it rejected four self-prepared analyses he offered as to what value his property should be assessed.
In two opinions handed down by the court, Vern R. Grabbe, pro se, appealed the 2009 assessment of his two contiguous parcels of land and the decision to apply the 2009 agricultural property assessment to the 2010 tax year.
For 2009, the property was assessed at $274,500. Grabbe thought that assessment was too high so he sought review. Before the Indiana Board of Tax Review, he presented four self-prepared analyses to show that the assessed value should be $218,262 – the allocation approach, the cost approach, the income approach, and the market data approach. The board determined all four approaches lacked probative value because he failed to show that his analyses comported with generally accepted appraisal principles, and it retained the $274,500 assessment value.
In Vern R. Grabbe v. Carroll County Assessor, Neda K. Duff, 49T10-1108-TA-51, Tax Judge Martha Blood Wentworth affirmed, finding the final determination upholding the 2009 assessment is supported by substantial and reliable evidence and is not contrary to law. Grabbe failed to present evidence that would support his assessment under the four approaches.
In Vern R. Grabbe v. Carroll County Assessor, Neda K. Duff, 49T10-1206-TA-35, Wentworth also affirmed the application of the 2009 assessment to the 2010 tax year. Initially, the property was assessed at $306,900 for the 2010 tax year, an 11 percent increase over the previous year’s assessment. Grabbe challenged the values and presented the same four self-prepared analyses to show that the value should be $218,862. The board issued a final determination, valuing the property the same amount as the 2009 assessed value.
Wentworth found that application reasonable given that neither of the parties presented probative evidence as to the subject property’s market value-in-use for the 2010 tax year. As such, the board’s decision is not contrary to law.
Indiana Court of Appeals
Juvenile – Placement with Out-Of-State Parent
In the Matter of M.S. (A Child Alleged in Need of Services), and K.S., (Mother) v. The Indiana Department of Child Services
A mother whose son was placed with his father in California after the Department of Child Services found her children to be children in need of services failed to convince a panel of the Indiana Court of Appeals that the placement was erroneous or that the DCS didn’t make a reasonable effort to preserve the family.
“We believe that the evidence in this case supported the continued out-of-state placement with M.S.’s natural father, which the trial court found to be in the child’s best interest,” Chief Judge Margret Robb wrote. “Therefore, the trial court’s decision to place M.S. with Father and eventually dismiss the CHINS proceedings was not error.”
Mother K.S. admitted during a CHINS hearing to substance abuse problems and that she had no permanent residence, vehicle or phone. DCS has found her missing on a visit to her home where the children had been left alone, according to the record.
As father’s service in the military unwound, he eventually took M.S. with him to live in San Diego, and DCS requested to dismiss the CHINS proceeding. On appeal, mother argued DCS neglected its duty under I.C. 31-34-21-5.5 to make reasonable efforts to reunify or preserve a family.
“The health and safety of M.S. was served by his placement with Father,” Robb wrote in an opinion joined by Judge Michael Barnes. “Moreover, the placement of M.S. with Father was a familial reunification of sorts, albeit not of the kind Mother would have preferred. In light of the circumstances, we believe DCS’s reunification efforts were reasonable.”
Judge Elaine Brown concurred in a separate opinion, but said the father’s home should have been inspected before the boy was placed with his father and that DCS was too quick to terminate the CHINS proceeding, which took place one week after father’s home had been inspected.
“Under such circumstances, despite the motion by DCS to dismiss the CHINS petition, I believe that M.S. would have been better served had the court ... ordered that DCS continue with services for a period of time to monitor Father’s parenting and compliance with the terms of the decree,” Brown wrote.
Post Conviction – Criminal Confinement/Resentence
State of Indiana v. Frank Greene
A man who was convicted of multiple felonies related to a two-day instance of domestic violence in which he “terrorized” his girlfriend in their apartment will be resentenced on a lesser charge on one conviction.
The Indiana Court of Appeals affirmed a post-conviction court’s grant of relief from a Class B felony criminal confinement conviction because Frank Greene’s counsel failed to cite relevant caselaw. The panel remanded for resentencing on the confinement conviction reduced to a Class D felony.
“Greene filed a petition for post-conviction relief, contending that he received ineffective assistance of both trial and appellate counsel for failing to rely on Long v. State, 743 N.E.2d 253 (Ind. 2001) in their respective argument that the State presented insufficient evidence of criminal confinement, as a Class B felony,” Judge Patricia Riley.
Long established that the elements of Class B felony confinement require that bodily injuries be caused by forcibly removing someone from one place to another. While Greene’s victim sustained injuries for which Greene also was charged, convicted and sentenced, evidence didn’t directly support the conviction as a Class B felony, the court ruled.
“Focusing on Long, the post-conviction court stated that if counsel would have adequately researched the sufficiency of the evidence issue and cited to Long as ruling precedent, the trial court and appellate court ‘would have had no choice but to reverse Greene’s conviction for the Class B felony,’” Riley wrote in an opinion joined by Judge James Kirsch.
Chief Judge Margret Robb concurred in a separate opinion but said she didn’t believe the outcome was necessarily compelled by Long. She also noted that effective July 1, 2014, the statute has been amended to a Level 3 felony, though “the legislature has not altered the strict language which seemingly requires that the injury occur during the removal.
“Because the statute itself precludes the enhancement to a Class B felony, and because neither Greene’s trial nor his appellate counsel raised this issue irrespective of Long, I concur with the majority that the post-conviction court properly granted post-conviction relief,” Robb wrote.
Criminal – Contempt of Court/Moot Appeal
Dayron Bell v. State of Indiana
A man held in contempt of court after a judge determined he threatened witnesses in his brother’s murder case had his appeal dismissed.
A panel of the Indiana Court of Appeals dismissed Dayron Bell’s appeal as moot because he had served his sentence. Only one of the four appellate issues he raised as justifying review was considered: whether the public interest exception justified appeal.
Bell appealed a finding that he was in direct contempt of court, arguing instead that he should have been held in indirect contempt for comments he made outside the courtroom to witnesses in the murder trial of his brother, Christopher.
Dayron Bell was ordered jailed for the duration of the trial, after which he was formally sentenced to serve 90 days in the Vanderburgh County Jail with no good time credit. His sentence was completed in August.
On appeal, he argued the court should use the public interest exception because: he claimed he was denied due process; that a similar situation was likely to arise again, so the court should weigh whether the incident was direct or indirect contempt; and that the court should review whether the denial of credit for time served was proper.
“Nothing in the facts of Bell’s case persuades this court that the issues raised by Bell are of ‘great public importance,’” Judge Edward Najam wrote for the panel, noting his appeal conflates the public-interest exception with error review. “That is not the purpose of this limited exception, and we will not deviate from our general rule of not deciding moot cases based on these facts. Accordingly, we decline Bell’s invitation to apply the public interest exception to this appeal, and we dismiss Bell’s appeal as moot.”
Civil Tort – Attorney Fees/Groundless Claim
Paul Gillock and Kathy Gillock v. City of New Castle, Indiana
A New Castle couple doesn’t have to pay the city’s appellate legal fees in its appeal of a frivolous litigation ruling, but they still must pay New Castle’s legal bills for the trial court filing.
Paul and Kathy Gillock sued the city of New Castle, claiming its storm-water drainage system caused flooding that damaged their property, but they didn’t pursue the litigation and ultimately moved to dismiss it.
Henry Circuit Senior Judge Rex Reed subsequently granted the city’s motion for attorney fees on the grounds the suit was frivolous, not made in good faith, and not prosecuted after filing. Reed ordered the Gillocks to pay New Castle $2,144.05 in legal fees.
The Gillocks appealed, and the city also asked for costs of defending the appellate suit. A panel of the Court of Appeals affirmed Reed’s award of attorney fees, but concluded, “the Gillocks’ appeal was not utterly devoid of all plausibility, and therefore deny the City’s request for appellate attorney’s fees and costs.”
Judge Terry Crone rejected the city’s claim that because the original suit was deemed frivolous, the appeal is likewise without merit. “We cannot agree,” Crone wrote. “That would essentially bar all appeals of attorney’s fees awarded on such grounds. … Accordingly, we deny the City’s request for appellate attorney’s fees.”
Criminal – Post-Conviction Relief
Freddie L. McKnight, III v. State of Indiana
A man seeking relief from his 2006 conviction of Class A felony dealing cocaine failed to persuade a panel of the Court of Appeals that his 48-year sentence should be reduced.
The Court of Appeals affirmed the Elkhart Circuit post-conviction court’s denial of relief. The panel rejected McKnight’s claims of ineffective assistance of counsel and that his hearing was unfair because an appointed public defender withdrew before the hearing and he proceeded pro se.
McKnight also claimed the state withheld evidence that a confidential informant had a 10-year-old theft conviction.
In affirming denial of post-conviction relief, Judge Terry Crone wrote for the court that “the State presented ample independent evidence of McKnight’s guilt. … McKnight has not demonstrated a reasonable probability that the outcome of his trial would have been different had trial counsel known about the theft conviction and attempted to impeach (the informant) with questions about that remote conviction.”
The panel also rejected the appeal on McKnight’s pro se argument. “Given that the right to counsel in a post-conviction proceeding is not guaranteed and that he was represented by appointed counsel until counsel properly withdrew as provided by our post-conviction rules, McKnight has stated no viable claim of error.”
Civil Tort – Negligence/Duty of Government Entity
Brad Haskin v. City of Madison, Indiana
A state statute providing immunity to municipalities for 20-year-old public work projects absolved a southern Indiana city from liability for an injury a man incurred when he stepped off a curb and into a sewer drain.
Brad Haskin was visiting the city of Madison for the Madison Regatta. While returning to his rental cottage one evening, he walked between the curb and a parked vehicle, stepped into a trough-shaped gutter and ruptured his Achilles tendon.
Haskin filed a complaint for damages against the city, alleging the municipality was negligent in designing, constructing and maintaining the drain. He also claimed the city failed to warn pedestrians of the potential hazard.
The trial court granted the city’s motion for summary judgment.
Before the Indiana Court of Appeals, the city of Madison argued it had immunity under Indiana Code 34-13-3-3(18), which protects municipalities from liability if the injury occurs at least 20 years after the public work was substantially redesigned. The city also noted the gutter was in good condition and Haskin’s injury was not caused by any deterioration in the drain.
Haskin countered that even under the statute, a governmental entity has a duty to provide public roadways in a reasonably safe condition. In addition, although the city had a lease agreement with Madison Regatta Inc., the city still had control over the street.
“To the extent Haskin claims the City was negligent in the design of the sewer drain and the City had a duty with respect to that claim, we agree with the City that, pursuant to Ind. Code 34-13-3-3-(18), the City was not required to ensure that the design of the curb and sewer drain, which were designed or redesigned at least twenty years prior to Haskin’s injury and were not altered by any resurfacing in 2002, was consistent with current practice or safety standards,” Judge Elaine Brown wrote. “The City was not required to redesign the sewer drain in an effort to incorporate ever-evolving technology.”
The Court of Appeals also found under the terms of a resolution of the Board of Public Works and Safety of the city adopted June 18, 2008, and the lease agreement, Madison Regatta Inc. did have control of the street. The Regatta organization was in the best position to control pedestrian traffic and the condition of the property it leased from the city.
Criminal – Leaving the Scene/Double Jeopardy
Winston K. Wood v. State of Indiana
A boat operator’s appeal of his convictions stemming from a fatal accident on Lake Monroe in 2010 split the Indiana Court of Appeals as to whether I.C. 14-15-4-1 is unconstitutional as applied.
Winston Wood was 19 years old when he and two friends were wakeboarding on the lake. He was driving his father’s boat when it collided with a boat driven by James Collier. Neither saw each other until the boats hit. The accident killed Collier’s wife and grandson, and injured Collier’s leg. Two other grandchildren on Collier’s boat were uninjured. Wood and his friends were also not injured.
Wood dove into the water toward Susan Collier, but he returned to his boat and drove it to the Fourwinds Marina after realizing he could not help Susan Collier. His friend called 911 and the operator told them to stay at the marina until authorities arrived. They believed their boat was taking on water.
The state charged Wood under I.C. 14-15-4-1 with leaving the scene of a boating accident resulting in the deaths of Susan Collier and grandson Gage, Class C felonies, and leaving the scene of a boating accident resulting in serious bodily injury to James Collier, a Class D felony. The statute outlines what the operator of a boat involved in an accident or collision resulting in injury or death or damage shall do.
Judges Melissa May and John Baker found sufficient evidence supported Wood violated the boating statute, but his three convictions of leaving the scene of a boating accident subjected him to double jeopardy, “as he was punished three times for an act – leaving the scene of an accident – he committed only once,” May wrote. Based on Nield v. State, 677 N.E.2d 79 (Ind. Ct. App. 1997), his act of leaving the scene can only support one conviction under the statute. The majority remanded for the trial court to dismiss one Class C felony conviction and the Class D felony conviction and to accordingly resentence Wood and reimburse the fines it imposed for those additional convictions.
The majority declined to find the statute unconstitutional as applied to Wood, but noted that the requirements of 14-15-4-1 will, in many emergency situations, “require behavior that defies logic, and engaging in innocent, and even advisable, behavior can leave one in violation of the statute,” May wrote. “This statute permits no consideration of what is reasonable in any given emergency situation; nor does it permit citizens to engage in any balancing of considerations that arise in typical emergencies and are likely required by other statutes.”
The majority encouraged the General Assembly to address these concerns.
Judge James Kirsch dissented, finding I.C. 14-15-4-1 is unconstitutional as applied.
“It is unquestioned that Wood claimed that he and his passengers were subject to significant peril and that he acted reasonably in moving his boat and its passengers to the marina. The statute did not give Wood fair notice that it was forbidden conduct to leave the scene of the accident even if Wood feared for his safety or that of his passengers and that necessity demanded that he leave the immediate accident scene.”•