7th Circuit Court of Appeals
Civil – Local Ordinance/Adult Bookstore
Annex Books Inc, et al. v. City of Indianapolis
The 7th Circuit Court of Appeals in Chicago has tossed an Indianapolis ordinance limiting the business hours of adult bookstores from 10 a.m. to midnight Monday through Saturday.
In a five-page opinion, Judge Frank Easterbrook wrote for a panel that reversed a District Court ruling in favor of Indianapolis’ ordinance in this long-running litigation. The panel ordered Judge Sarah Evans Barker of the District Court for the Southern District of Indiana to grant an injunction barring enforcement of the closure ordinance.
Easterbrook wrote the city could no more restrict the hours of an adult bookstore than it could limit the hours during which a Sunday newspaper could be distributed.
“The difference lies in the content of the reading material. Indianapolis likes G-rated newspapers but not sexually oriented books, magazines, and movies,” Easterbrook wrote, noting that in two precedent-setting U.S. Supreme Court rulings, neither “permits units of government to stop the distribution of books because their content is objectionable, unless the material is obscene.”
“Indianapolis does not contend that any of the plaintiffs sells obscene material; it follows that objection to the plaintiffs’ stock in trade cannot justify closure,” the panel held.
The city failed to persuade the court that the ordinance was justified because of claims of fewer armed robberies near adult bookstores during the times they were closed.
“The current justification is weak as a statistical matter,” the panel held, noting the city didn’t control for other potentially important variables such as nearby late-night taverns. In any event, Easterbrook wrote, “The change in the number of armed robberies is small; the difference is not statistically significant. The data do not show that robberies are more likely at adult bookstores than at other late night retail outlets, such as liquor stores, pharmacies, and convenience stores, that are not subject to the closing hours imposed on bookstores.”
Civil – Environmental Cleanup/Underground Storage
Bitler Investment Venture II, LLC, et al. v. Marathon Petroleum Company LP, et al.
Owners who leased properties in Michigan and Indiana that were used as Marathon gas stations – some of which were neglected, abandoned and condemned while Marathon leased them – will be paid more than the $269,000 a District judge in Fort Wayne awarded.
The 7th Circuit Court of Appeals opened the door for a greater judgment against Marathon for claims that began with its environmental cleanup of underground gas storage tanks at fewer than a dozen locations where it did business. Contract terms called for Marathon to remove underground tanks and return the properties as near as possible to their prior condition.
But Circuit Judge Richard Posner wrote for the panel that locations in Adrian and Michigan Center, Mich., were abandoned and ordered condemned while Marathon was still paying the lease. District Judge Theresa Springmann of the Northern District of Indiana wrongly denied double damages permitted under Michigan law governing the doctrine of waste and erred in dismissing other claims, the panel ruled.
The “contract and waste claims concerning these buildings should not have been dismissed,” Posner wrote for the panel.
“So the judgment awarding damages for waste regarding the four Michigan properties is vacated with directions to the district court to double those damages,” Posner wrote, which would result in an award of $538,000. “(T)he dismissal of the contract and waste claims relating to the buildings on the properties in Adrian and Michigan Center is reversed and that aspect of the case is remanded for trial.”
The plaintiffs argued Marathon’s breach of lease and committing waste on the properties were guided by anti-competitive motives. Plaintiffs sought damages in excess of $9 million in litigation that also included a commercial property in Angola, Ind.
Civil – First Amendment/Protest
Eric Smith v. Executive Director of the Indiana War Memorials Commission, et al.
A man who wanted to protest a proposed United Nations arms treaty on Indianapolis’ Monument Circle in 2012 but was kicked off the property because of a lack of permit was victorious in the 7th Circuit Court of Appeals.
Eric Smith and his son sought to protest the Arms Trade Treaty on the Circle. They made flyers announcing the protest, but no one showed up except the two of them. The Circle is an outdoor state-run public property; the Indiana War Memorials Commission supervises the Soldiers and Sailors Monument at Monument Circle.
Once they began protesting, a commission employee asked if Smith had an event permit. Since he did not, the employee told the two to leave the property. They moved after state police arrived.
Smith sued in federal court, claiming the commission’s permit policy – which was unwritten at the time – violates the Free Speech Clause of the First Amendment. Christina Gaither, the commission’s director of administration, testified about the policy, which revealed numerous inconsistencies. For example, the policy would require Smith to get a permit, but 25 people could gather for lunch on the Circle and not need a permit. She was uncertain if those people would need a permit if they wore political T-shirts during the meal.
The commission claims Smith’s appeal of the denial of his motion for a preliminary injunction is moot because they have since enacted a written permit policy.
The 7th Circuit noted that the new policy retains the problematic features of the old policy, so the appeal is not moot. Judge David Hamilton noted that although the amended policy has an exception for groups smaller than fifteen, it also contains so many exceptions to that exception that it still requires permits for many smaller events, including events like Smith’s July 2012 protest of the arms treaty and others he is likely to organize in the future.
The judges found Smith made the necessary showing to obtain a preliminary injunction, so they ordered the District Court to determine the proper scope of the injunction, including whether it should extend beyond Monument Circle to other properties the commission administers.
“As we have explained, the number of people who must be allowed to gather without a permit may depend on the specifics of the space in question. We decide here only that Smith appears likely to prove at trial that fifteen is too small a number to trigger a permit requirement for Monument Circle and that he has met the other requirements for preliminary injunctive relief,” Hamilton wrote.
Indiana Court of Appeals
Juvenile – Animal Cruelty/Criminal Mischief
A.J.R. v. State of Indiana
The Indiana Court of Appeals reversed a teenager’s adjudications for cruelty to an animal after finding the evidence was not sufficient to prove he mutilated or tortured either cow he shot.
Seventeen-year-old A.J.R. and his 14-year-old friend C.C. were in LaPorte County coyote hunting with C.C.’s semi-automatic AR-15-style rifle. When they came upon a pasture of cattle, A.J.R. took C.C.’s rifle, leaned out of the driver’s side window of his car, and fired two shots into the herd of cattle. C.C. fired at cattle at another pasture.
The cattle’s owner discovered two of his cows lying on the ground. One had a wound in its head, the other had no visible wound but was moaning and unresponsive. Both died within 30 minutes of the shooting.
Police interviewed the teens, during which A.J.R. admitting to driving the car when the cows were shot after C.C. implicated A.J.R. in the shootings. A.J.R. was adjudicated as a delinquent for committing what would be two counts of cruelty to an animal, two counts of criminal mischief, and aiding, inducing or causing criminal mischief, if committed by an adult.
The appellate judges found there was sufficient evidence that A.J.R. shot and killed two of the cattle, including testimony of sheriff’s deputy Troy Ryan, who investigated the area where the two shootings occurred. Thus, they affirmed his adjudications for criminal mischief.
But the judges reversed the adjudications for cruelty to animals because there’s no evidence the teen intended to torture or mutilate the cows. There’s no evidence that A.J.R. shot either of the cows with the intent of increasing or prolonging the animals’ pain, as is required for conviction of this crime by the statute. Nor is there evidence that he targeted either cow in a way that would result in serious disfigurement, protracted impairment of a body part or organ, or a fracture, Judge Margret Robb wrote, which again is required by statute.
The judges also affirmed the admission of Ryan’s skilled witness testimony, ruling it did not violate A.J.R.’s right to a fair fact-finding hearing.
Civil Plenary – Insurance/Environmental Liability
Chubb Custom Insurance Company, et al. v. Standard Fusee Corporation
The Indiana Court of Appeals reversed the decision by an Indiana court relying on Maryland law that granted summary judgment and defense costs to a business whose product led to perchlorate contamination in California and Indiana.
Perchlorate had been discovered in water samples in California and Peru, Ind., where Standard Fusee Corp. had facilities. The company makes highway and marine signal/safety flares, in which an essential ingredient is perchlorate. Standard Fusee notified its comprehensive general liability insurance carriers, including Chubb Custom Insurance Co. and GAN North American Insurance Co., about the claims at the facilities and sought defense and indemnification. Both insurers rejected their duty to defend and refused indemnification based on pollution exclusions.
The trial court, relying on Maryland law because that is where Standard Fusee is headquartered, ruled in favor of the company and awarded more than $2 million in defense costs. The judge held that the total pollution exclusion clause in the policies is not applicable to Standard Fusee’s liability for the release of the contaminate, thereby triggering the duty to defend and indemnify.
The insurers claim that if the release of perchlorate is defined as traditional environmental pollution, Maryland law enforces the application of the pollution exclusion clause in the insurance contract and coverage is precluded.
Guided by the principles of Maryland’s contract interpretation, the Court of Appeals concluded that perchlorate is included within the usual, accepted meaning of “pollutant.” Judge Patricia Riley noted the continuous discharge of perchlorate over multiple years went beyond the routine commercial hazard of an occasional spill.
“Based on the facts before us, we conclude that Standard Fusee’s claim is based on a hazardous pollution contamination, resulting from the cumulative effect of numerous releases which occurred on an ongoing basis during the regular course of business over an extended period of time, up to the point where the pollution became concomitant to Standard Fusee’s regular business activity,” she wrote.
“We expect that, our decision notwithstanding, interpretation of the scope of pollution exclusion clauses likely will continue to be ardently litigated throughout state and federal courts. We are also aware that courts may arrive at divergent decisions from our own within the specific context of perchlorate contamination. Yet, guided by Maryland’s rules for interpreting insurance contracts, we conclude that the total pollution exclusion clause applies and relieves Appellants of their duty to defend and indemnify the Standard Fusee in the underlying action,” she wrote.
Criminal – Fourth Amendment/Sentence Enhancements
Johnathon R. Aslinger v. State of Indiana
In a consolidated appeal, the Indiana Court of Appeals reversed a Huntington County man’s convictions and sentences for possession of methamphetamine and paraphernalia, ruling the trial court abused its discretion in admitting evidence purportedly seized in violation of the Fourth Amendment.
Johnathon Aslinger was charged in Case No. 127 with the possession counts; he was charged with dealing in methamphetamine as a Class A felony in Case No. 152. The charges in Case No. 127 stem from a stop by police investigating vehicle break-ins. Aslinger and his friend Geoffrey Fugate were standing near a street where the cars were located and fit the description provided by dispatch. The officer saw a rolled cigarette behind Aslinger’s ear, which he said was “B2,” a form of synthetic drug Spice. A witness saw the two and said they were not the men who broke into the vehicles. By this time, the officer had searched Aslinger’s pockets because he saw a knife and found drug paraphernalia and methamphetamine. He also tested the cigarette and found it to be marijuana.
While on bond for Case No. 127, Aslinger was arrested for making meth within 1,000 feet of a public park.
He was convicted in separate trials, but sentenced together to 32 years for the dealing charge, enhanced by five years for the habitual substance offender adjudication. In the other case, he received a total of seven years, which included a five-and-a-half-year enhancement for being adjudicated as a habitual substance offender.
The judges reversed his convictions in Case No. 127, finding the officer’s conduct went beyond what is allowed during a Terry stop. Judge Patricia Riley noted that a hand-rolled cigarette is not illegal per se and the officer only deduced there was a drug in it after removing it from Aslinger’s ear.
The judges also held that the trial court erred in imposing consecutive HSO enhancements in the two cases. On remand, they instructed the court to order the enhancements be served concurrently.
The appellate judges affirmed Aslinger’s dealing conviction, finding no error in the trial court’s decision to refuse to submit his tendered jury instruction asking the jury to find his conviction should not have been enhanced to a Class A felony. They also affirmed his sentence on the dealing conviction.
Judge Margret Robb concurred in a separate opinion, noting she believed the majority’s statement of law applicable to the plain view doctrine is too broad.
Civil – Disclosure of UIM Limit/Jury Award
State Farm Mutual Automobile Insurance Company v. Kimberly S. Earl and The Estate of Jerry Earl
Ruling on an issue of first impression, a divided panel of the Indiana Court of Appeals on rejected a jury’s award of $250,000 to the widow of a motorcyclist injured in a crash. The majority remanded for a new trial, holding that disclosure of uninsured motorist policy limits was irrelevant and prejudiced the jury.
The majority’s holding would align Indiana with other states such as Florida and Nebraska in which courts have ruled that disclosure of policy limits may be reversible error.
A Jackson Circuit jury awarded Jerry Earl $250,000 under his uninsured motorist coverage after he was run off the road by a tractor-trailer on Interstate 65. Both parties stipulated Earl was not at fault in the 2008 crash in which the trucker, apparently unaware of the crash, did not stop and was never identified. Earl since died from an unrelated cause.
“State Farm argues that the trial court erred when it allowed into evidence at a jury trial the $250,000 bodily injury limit provision contained in the Earls’ (uninsured motorist) insurance policy. State Farm contends that evidence of the bodily injury limit was both irrelevant and prejudicial. Determining that evidence of the bodily injury limit was in fact both irrelevant and prejudicial, we reverse and remand this cause to the trial court for further proceedings consistent with this opinion,” Judge John Baker wrote for the majority, joined by Chief Judge Nancy Vaidik.
Judge Patricia Riley dissented.
“State Farm asserts, and the majority agrees, that the amount of the verdict –which was exactly the maximum under the UM coverage – suggests that the jury was influenced by the evidence of the coverage limit,” Riley wrote. “However, the majority disregards the substantial amount of evidence reflecting Jerry’s extreme pain in the weeks after the wreck and the physical pain, mental suffering, and limitations he continued to suffer because of his injuries until his death.
“Prejudicial error is not established merely because the jury awarded the UM policy limit; rather, the more appropriate inference is that the jury followed the trial court’s instructions and, in light of the overwhelming evidence, arrived at the policy limit. I would affirm the trial court.”
Criminal – OWI Causing Death/Double Jeopardy
Jeffrey A. Cleary v. State of Indiana
A majority of an Indiana Court of Appeals panel upheld a man’s conviction and 14-year sentence for driving while intoxicated causing death, but a dissenting judge said the unusual case history that led to the outcome constituted double jeopardy.
Jeffrey Cleary was involved in a crash on a ramp leading to Interstate 65 near Hobart in 2010. His vehicle struck a service truck that was pushed into and killed Philip Amsden, who was changing a tire on a tractor-trailer at the time.
Cleary was convicted of the Class B felony at a second trial. In the first trial, Cleary was convicted of misdemeanor driving while intoxicated charges but the jury deadlocked on the felony OWI causing death count. Cleary moved for a directed verdict, but Lake Superior Judge Thomas Stefaniak denied the motion and ordered a new trial.
On appeal, Cleary argued that the retrial violated his double-jeopardy protections, that a blood draw used to establish his blood alcohol content was improper and shouldn’t have been admitted, and that his sentence was inappropriate.
Judge Michael Barnes wrote for the majority that had judgment been entered on the lesser convictions after Cleary’s first trial, he would be barred from being retried. But judgment wasn’t entered.
“We do not agree with Cleary, however, that the trial court was required to enter a judgment of conviction, as opposed to ordering a new trial, upon the return of the jury’s verdict. Indiana Code Section 35-38-1-1(a) explains, ‘Except as provided in section 1.5 of this chapter, after a verdict, finding, or plea of guilty, if a new trial is not granted, the court shall enter a judgment of conviction,’” Barnes wrote for the majority joined by Judge Rudolph R. Pyle III.
“Quite simply, because a new trial was granted, the trial court was not required to enter a judgment of conviction,” Barnes wrote.
But Judge Terry Crone dissented, writing the trial court should have entered judgment after the first trial. “I find Cleary’s argument persuasive and believe that allowing the State to ‘keep taking a shot’ at a felony conviction against a defendant in Cleary’s position violates principles of fundamental fairness as well as the principles underlying the constitutional prohibition against double jeopardy,” Crone wrote.
“Cleary’s double jeopardy rights were violated, and therefore I would reverse and remand with instructions to vacate his class B felony conviction and resentence him accordingly,” Crone wrote.
Criminal – Double Jeopardy
Frank Jacobs v. State of Indiana
The Indiana Court of Appeals vacated a conviction of Class C felony criminal confinement for a man also convicted of Class B felony criminal deviate conduct, finding the lesser conviction resulted in double jeopardy.
Frank Jacobs was convicted of both counts in Marion Superior Court that heard evidence that he forcibly performed oral sex on a minor boy. The appeals court ruled “Jacobs did not use more force than was necessary to commit criminal deviate conduct, and Jacobs’ conviction of confinement based on the same force subjected him to double jeopardy.”
Vacating the lesser charge is unlikely to affect Jacobs’ sentence, however. He was sentenced to 10 years in prison on the deviate conduct charge and four years for confinement, to be served concurrently.
Judge Melissa May wrote for the panel that Jacobs’ arguments that the trial court abused its discretion by excluding testimony about the victim’s truthfulness and refusing his request to admit evidence from Jacobs’ son. Any error in refusing such testimony was harmless, May wrote, because of independent evidence of Jacobs’ guilt.
Criminal – Release of Cash Bond
Thomas D. Dillman v. State of Indiana
A pro se litigant convinced the Indiana Court of Appeals that he was entitled to a refund of a $250 cash bond. The COA reversed a Monroe Circuit order denying a motion for release of cash bond dating to 2003.
The appeals court panel in a five-page order remanded with instructions for the trial court to release the bond.
“Because Dillman’s $250 bond was a cash bond posted under Ind. Code § 35-33-8-3.2(a)(1), the court was not authorized to retain the bond for any purpose,” Judge Melissa May wrote. “We must accordingly reverse the denial of Dillman’s Motion for Release of Cash Bond and remand for further proceedings consistent with this decision.”
The panel noted, however, that I.C. 35-33-8-3.2 was amended in 2006, allowing a court to retain cash bonds in some situations, such as to pay publicly paid costs of representation, fines, costs, fees or restitution upon conviction.
Juvenile – Custody Modification/Parental Relocation
In Re The Paternity of C.J.A.: G.C. (Mother) v. T.A. (Father)
A trial court’s order automatically awarding custody of a minor child to the father was reversed by the Indiana Court of Appeals on the grounds the lower court’s decision violated the state’s custody modification statute.
The Tippecanoe Circuit Court issued a provisional order that primary physical custody would be awarded to the father of the minor child, C.A., if the mother did not relocate to Indiana by March 31, 2013.
Mother and father met and had C.A. while in high school. The couple never married but successfully co-parented the child until the mother moved to South Carolina to complete a college degree. Father continued visiting C.A. and paying monthly child support.
The mother finished her degree and opted to remain in South Carolina. Finding that permanent relocation to South Carolina was not in C.A.’s best interest, the trial court ordered that if the mother did not move back to Indiana by March 31, 2013, the father would be awarded primary physical custody on April 1, 2013.
The Court of Appeals reversed the order. The court ruled that the language ordering the change in custody be automatically modified was inconsistent with the requirements of the state’s custody modification statute, Indiana Code 31-14-13-6.
However, Judge Elaine Brown dissented, arguing the trial court’s order was not a final judgment and had not disposed of all claims. Therefore, the Court of Appeals did not have jurisdiction over this appeal and should have dismissed.
Criminal – Attempted Murder/Jury Instruction
Ruben Rosales v. State of Indiana
The Indiana Court of Appeals has split on whether an erroneous jury instruction was a harmless error or gave the jurors another base for finding a defendant guilty of attempted murder.
Ruben Rosales, a member of the Latin Kings gang in Anderson, was convicted of attempted murder following an attack on a rival gang member, Sergio Torres. A witness saw Rosales, carrying a baseball bat, and another man enter an alley were Torres was. No one saw Rosales actually hit Torres on the head with the bat.
At trial, the jury was instructed on the requirements for attempted murder as well as accomplice liability.
Rosales argued, on appeal, that the trial court made a fundamental error when it did not tell the jury that an accomplice to attempted murder must act with specific intent to kill. Instead, during the Rosales’ trial, the court told the jury an accomplice is someone “who knowingly or intentionally aids, induces or causes another person to commit an offense.”
The Court of Appeals rejected Rosales’ arguments. It pointed out the accomplice liability was not the only theory for his conviction and the state’s evidence supports the jury’s finding that he was guilty of attempted murder as the principal.
“Here, the trial court properly instructed the jury on all the elements of the offense of attempted murder, with respect to which the additional instructions on accomplice liability were mere surplusage,” Edward Najam Jr. wrote for the majority. “The jury’s verdict form states that the jury found Rosales guilty of ‘Attempted Murder’ without delineating whether the jury found him guilty as the principal or the accomplice. Thus, when the jury found Rosales guilty of attempted murder, the State had met its burden of proof on each and every element of the offense of attempted murder, and ‘it simply does not matter how’ the jury was instructed on accomplice liability.”
Judge Terry A. Crone dissented, arguing the jury instruction was a fundamental error because only the final instructions to the jury mentioned accomplice liability. This gave the jurors two distinct avenues for finding Rosales guilty and while they could have convicted him as principal, they could also have found him guilty as an accomplice based on the erroneous instruction.
Criminal – Mental Illness/Psychiatrist Report
Tammy Lou Kelley v. State of Indiana
A woman who brutally attacked her boyfriend’s minor child had her conviction overturned by the Indiana Court of Appeals on the grounds that the trial court did not have enough evidence to contradict the psychiatrists’ reports and find her guilty but mentally ill.
Tammy Lee Kelley was arrested and charged after an attack that left D.S., the minor child, with multiple stab wounds, including one that narrowly missed her kidney and another on her chest that partially collapsed one of her lungs. Subsequently, Kelley was evaluated by two psychiatrists who both documented her mental disease and concluded she was unable to appreciate the wrongfulness of her conduct at the time of the offense.
During a bench trial, no testimony was taken, the parties stipulated to the police reports and the two psychiatrists’ reports were offered along with some of D.S.’s medical records. The trial court found Kelley guilty but mentally ill on the following: one count of criminal confinement as a Class C felony, battery of a person under fourteen resulting in bodily injury as a Class D felony, and resisting law enforcement as a Class A misdemeanor; and two counts of battery of a law enforcement officer resulting in bodily injury as Class D felonies.
On appeal, Kelley argued that the trial court could not find her guilty but mentally ill when the medical evaluations were unanimous that she was insane at the time of the incident and when there was no contradictory lay testimony. The state cited Thompson v. State, 804 N.E.2d 1146, 1149 (Ind. 2004), as giving the judge in this case the freedom to reject the expert testimony. The COA reversed and remanded with instructions for the trial court to enter a finding of not guilty by reason of insanity.
“While it appears that there was limited foundation for the psychiatrists’ determinations, there is even less on which the trial court could have decided to disregard those determinations,” Judge Margret Robb wrote for the court. “In short, there was no lay witness testimony and little demeanor evidence from which the court could have deduced, contrary to the two psychiatrists, that Kelley was sane at the time of the incident.”
Criminal – Private Property
Jeremy Schath v. State of Indiana
A raccoon hunter’s misdemeanor conviction was reversed when appellate judges determined he wasn’t hunting or chasing wildlife when he retrieved his wandering dog from property where he didn’t have permission to hunt.
Jeremy Schath was convicted of Class C misdemeanor chasing wildlife on private property without the consent of the owner after the state amended an initial charge of hunting without permission during a bench trial before Decatur Superior Judge Matthew D. Bailey.
Schath was raccoon hunting in November 2012 with the permission of the property owner when his dog wandered onto private property where Schath didn’t have permission to hunt. He put his gun down and retrieved the dog, which had cornered a raccoon in a drainage pipe.
“While we do not reweigh the credibility of witnesses or the evidence on appeal, we note that in the instant matter, no such ‘reweighing’ is necessary because all of the evidence in the record indicates that Schath entered the Coffee Tree Farms Property for the sole purpose of retrieving his dog, not for the purpose of chasing a raccoon,” Judge Cale Bradford wrote for the panel.
“As such, we conclude that the evidence presented before the trial court was insufficient to sustain Schath’s conviction for Class C misdemeanor chasing wildlife on private property without the consent of the landowner. Accordingly, we reverse Schath’s conviction.”
Juvenile – Intimidation
In Re: The Matter of C.L., a Delinquent v. State of Indiana
Split over whether a teen’s threats toward his grandfather were intended to place the man in fear of retaliation for a prior lawful act, two Indiana Court of Appeals judges reversed a teen’s delinquency adjudication for committing intimidation.
Terry Landis called 911 and told law enforcement that he had escaped from his residence after his teenage grandson C.L. had held him hostage for several days because Landis refused to give a portion of a home loan he planned to take out to C.L. to buy a car. C.L. said if he didn’t get the money he would beat his grandfather and that if he got sent to jail he would kill his grandfather when he got out. Landis was fearful of his grandson because of his strength and size.
C.L. was adjudicated delinquent for committing one count of what would be Class A misdemeanor intimidation if committed by an adult. Judges John Baker and Terry Crone reversed because the statute requires the threats to place Landis in fear of retaliation for a prior lawful act. The majority held the threats made by C.L. were conditional and targeted a future conduct. Landis testified he had not taken out the loan yet at the time C.L. demanded the money.
Judge Edward Najam dissented, writing that Landis’ decision to get the home loan for repairs and refusal to give C.L. any portion of the loan constitute a prior lawful act. A reasonable inference from the evidence demonstrates that C.L.’s threats were intended to place his grandfather in fear of retaliation for his prior lawful act of having decided not to surrender a portion of the loan proceeds to C.L., Najam wrote.
Small Claim – Nursing Home/Responsible Party
Alexis Hutchison and Martha Farber, deceased and Trilogy Health Services, LLC, d/b/a Springhurst Health Campus
A woman who signed a move-in agreement at a skilled nursing facility as a “responsible party/agent” for her mother was able to prove to the Indiana Court of Appeals she should not be liable for money owed by her mother for care while at the facility.
Alexis Hutchison, pro se, appealed a $2,610.87 judgment against her for services rendered to her mother, Martha Farber, while Farber lived at Springhurst Health Campus. Farber was ill with cancer and required a nearly three-month stay at the facility. She died Feb. 21, 2013, while this litigation was pending.
The agreement Hutchinson signed says that the responsible party/agent agrees to pay the facility the full amount of the resident’s income and resources that the responsible party/agent controls or accesses. Hutchinson’s defense at trial focused on the fact she did not have power of attorney or the authority to manger her mother’s funds. The business manager of Springhurst testified that the facility did not have any records that Hutchinson had power of attorney over her mother. Hutchinson’s husband testified that a facility representative told Hutchinson she would not be personally responsible for her mother’s bill when she signed the agreement.
The judges pointed out that Congress has imposed limitations on the concept of a family member being financially responsible for another family member’s care. Some resident-rights advocates claim that third-party guarantee or responsible party provisions are inherently illegal, although some courts have concluded under federal law that third parties can “volunteer” to sign as guarantors of payment to nursing homes.
“It appears Indiana courts have not yet expressly spoken to the legality of the responsible party provisions; although Hutchison urges us to declare that such provisions are unenforceable, we find it unnecessary to reach that issue today,” Judge James Kirsch wrote.
The agreement doesn’t define “responsible party” but says that person agrees to pay the full amount of the resident’s income and resources “that the Responsible Party/Agent controls or accesses.” There is no evidence that Hutchinson ever had authority to “manage, use, control or access” her mother’s income, financial accounts or other resources, as written in the agreement. The trial court erred, so the Court of Appeals reversed and remanded with instructions to enter judgment for Hutchinson.
Mortgage Foreclosure – Sheriff Sale Surplus
Joel Stoffel v. JPMorgan Chase Bank, N.A. and Federal National Mortgage Association
The Indiana Court of Appeals awarded a Grant County man nearly $375 after finding a surplus was owed to him when his property sold at a sheriff’s sale for more than what was calculated by the trial court based on an agreed judgment between the man and the bank.
JPMorgan Chase Bank filed a complaint to foreclose on Joel Stoffel’s property. In 2012, the two filed an agreed judgment entry and decree of foreclosure, outlining how much a personal judgment against Stoffel would be. The agreement came to a total of $139,907.82 plus any additional costs related to the sheriff’s sale.
Chase assigned the agreed judgment to the Federal National Mortgage Association, which submitted the winning bid at the sheriff’s sale of $152,121.72, through a credit bid. A credit bid is made by the judgment creditor in which no money is exchanged. Shortly thereafter, Fannie Mae filed its satisfaction and release of judgment with the trial court.
Stoffel filed a complaint seeking payment of an alleged surplus balance based on the difference between the credit bid and the $139,907.28 face amount of the agreed judgment. The trial court denied his motion and, based on its math, ruled there was no surplus.
The Court of Appeals reversed in part, finding there to be a $374.58 surplus after calculating the principal, post-judgment interest, real estate taxes and sheriff’s sale expenses. It came to this amount by excluding some evidence the trial court had admitted that was inadmissible. The court ordered a judgment in favor of Stoffel for this amount.
The COA affirmed the trial court’s rejection of Stoffel’s argument that Fannie Mae’s satisfaction of judgment prohibited it from introducing evidence to show the correct amount of the agreed judgment. The agreed judgment left certain costs to be determined, and Fannie Mae’s satisfaction of judgment did not preclude the presentation of admissible evidence to demonstrate those costs and rebut Stoffel’s allegation that a surplus existed.
Criminal – Restitution/PPI Payment
Ruben Gonzalez v. State of Indiana
A partial permanent impairment settlement cannot be considered by a trial court when imposing restitution, the Indiana Court of Appeals held.
Ruben Gonzalez appealed the $41,200 in restitution he was ordered to pay to JWF Specialty Company, the third-party administrator for the state’s workers’ compensation benefits. Gonzalez, while incarcerated at the Miami Correctional Facility, severely beat correctional officer Rodney Gahl with a padlock contained in a sock. The attack caused severe life-threatening injuries, resulting in extensive treatment and therapy and substantial permanent impairments.
Gonzalez was convicted of Class A felony attempted murder and Class B felony aggravated battery. The trial court ordered he pay JWF more than $257,000 in restitution. He only appealed the portion of the restitution order related to the permanent partial impairment settlement paid to Gahl.
The parties agree that JWF can recoup the restitution amounts JWF paid for Gahl’s medical treatment and lost wages, which were incurred prior to the sentencing hearing.
“The medical and lost-wages costs assumed by JWF are specific costs that a trial court shall consider when imposing restitution. The same cannot be said for the PPI settlement,” Judge Ezra Friedlander wrote, citing I.C. 35-50-5-3(a)(2) and (4).
“A PPI payment is compensation for an injured employee’s permanent loss of physical function(s) rather than for an inability to work. Gahl, himself, could not have sought restitution at the criminal proceeding for loss of physical function, as it does not encompass already-incurred lost wages or medical expense. Accordingly, JWF cannot recover the PPI payment via its status as a surrogate victim.”
The judges remand for the trial court to reduce the restitution award by $41,200. They also ordered the trial court to vacate the aggravated battery conviction because of a double jeopardy violation.•