A divided Court of Appeals Tuesday affirmed a trial court judgment for $175,000 in favor of a consultant who co-signed a mortgage in exchange for shares in a company and half-ownership in the real estate.
Megan Van Petten was awarded the judgment in a case brought more than six years after Chad Folkening was to pay $175,000 to satisfy the mortgage, but failed to do so.
In Chad Folkening, DSL.Com, Inc. and eCorp, v. Megan Van Petten n/k/a Megan Van Petten Walton, 49A02-1403-PL-181, Folkening argued on appeal that Van Petten’s claim was barred under I.C. 34-11-2-9, which sets a six-year limit from the cause of action on litigation for contracts involving obligations to pay money.
The majority affirmed, though, finding that Van Petten’s claim was subject to the 10-year limit contained in I.C. 34-11-2-11, “because the Agreement concerns more than just the payment of money,” reasoned Judge Terry Crone in an opinion joined by Judge Paul Mathias.
“It stands to reason that Van Petten’s claim for the conveyance of the deed, which was based on the Agreement and has nothing to do with the payment of money, must be subject to the same statute of limitations as her claim for $175,000,” Crone wrote. “The fact that the parties settled the claim regarding the deed after the lawsuit was filed is inconsequential.”
Judge Patricia Riley dissented and found that the six-year limit should have barred Van Petten’s claim. Riley would reverse the trial court.
“A strict reading of the Agreement reveals that the conveyance of the deed is not an alleged harm, but rather a contractually prescribed remedy in the event Folkening failed to ‘pay off and satisfy the entire balance of the mortgage[.]’ (emphasis added),” she wrote. “Therefore, I conclude that Van Petten’s claim is based solely and entirely on Folkening’s breach of his obligations to pay money.”