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Court affirms son owes dad $40K in appraisal fees

March 13, 2018

A dispute between a Howard County father and son who operated a real estate appraisal business was rightly decided by the trial court, which found the son owed his father more than $40,000 in past-due appraisal fees.

The Indiana Court of Appeals affirmed the award Tuesday in Mark Blacklidge v. Kent Blacklidge, 34A02-1710-PL-2509. The two formed a Kokomo appraisal company, Blacklidge Appraisals, in 2000, based on an oral agreement that each was entitled to 70 percent of revenue from the appraisals each performed, and the remaining 30 percent would pay for the company’s overhead.

An accountant found that father Kent was owed more than $28,000 in appraisal fees that had been collected from May 2011-December 2013. Subsequently, Kent received smaller and smaller payments for the appraisals he did until he finally terminated the business relationship in June 2015. He sued his son the following February, and the trial court found Mark owed his father $40,623.55.

On appeal, Mark argued the trial court erred when it disregarded the entity’s formation of a limited liability corporation some years after the enterprise began. He also argued the dispute should have been limited by a two-year statute of limitations rather than the six-year period the trial court observed.

The appellate panel affirmed the trial court’s findings and judgments, but on a different legal theory.

“We agree that the trial court erred as a matter of law when it disregarded the LLC, but we uphold the judgment against Mark, personally, on other grounds,” Judge L. Mark Bailey wrote for the panel.

“Mark had knowledge of the LLC’s non-payment to Kent of money owed to Kent pursuant to the oral operating agreement and of the probable injury that non-payment would cause to Kent. And Mark knew that, as of January 1, 2014, he was the only person in a position to make that payment. Nevertheless, Mark chose not to pay Kent the money he was owed, instead exhibiting indifference to the consequences of the non-payment,” Bailey wrote. “Thus, the trial court’s findings of fact support the conclusion that Mark’s refusal to pay Kent money Mark knew the LLC owed Kent was willful misconduct — or at the very least, reckless — and that Mark may be held personally liable to Kent for the amount owed.”

The trial court did not err in applying a six-year statute of limitations to the parties’ oral agreement, the COA ruled.

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