The Indiana Court of Appeals on Friday affirmed on interlocutory appeal a trial court’s decision that it has the legal authority to address the merits of an Indiana Trial Rule 60(B) claim in a dispute over a dock location between Brown County lakefront property owners.
Lakefront property owners Daniel and Leanna Hess argued whether the Brown Circuit Court had the authority to rule on the merits of an Indiana Trial Rule 60(B) motion to supplement/modify an agreed permanent injunction that was previously entered by the couple and their neighbor, Sheryll Novicki, to a boundary dispute regarding the use of an inlet between their properties.
Issues began between the neighbors when Novicki sought to construct a dock/lift in the narrow inlet separating her lakefront tract from the Hesses’. Rules crafted by the Cordry-Sweetwater Conservancy District stated that each tract owner is entitled to unobstructed use of their half of the inlet, as determined using a midpoint. At that time, CSCD rules measured the midpoint of each inlet by using an imaginary line extending from the shore.
The Hesses filed a complaint against Novicki seeking declaratory and injunctive relief concerning her construction of her dock and use of the inlet, contending it allegedly encroached on their half of the inlet. They also named the CSCD board as a defendant in their complaint.
After a successful mediation, Novicki and the Hesses executed an agreed permanent injunction that stated, “Neither party shall encroach by improvement or the regular parking of watercraft across an imaginary line that represents one-half of the width of the inlet on which their properties are located. However, this shall not be construed to be a grant of permission by either party to allow the other to encroach up to this imaginary line if the same is not permitted by CSCD rules in effect at the time.”
The board, which was not a party to the agreement and was subsequently dismissed from the action, amended its rules on how to determine the midpoint just months after the injunction was approved. The new formula determined the midpoints of all inlets based on property lines, not on shorelines.
Novicki then filed a Trial Rule 60(B) motion to supplement/modify the permanent injunction to reflect the CSCD’s amended rules concerning the new boundaries. The trial court ruled that she was not precluded from pursuing relief under the rule after issuing an interlocutory order concluding that “when a judgment, including an agreed judgment, has prospective application or effect, the Court must have the power to act to avoid an inequitable result that is caused by a change in circumstances that was not reasonably foreseeable at the time the judgment was entered.”
The Indiana Court of Appeals affirmed the trial court’s decision, finding that the circumstances of the case were more closely analogous to those in United States v. Swift & Co., 286 U.S. 106, 114-15 (1932).
“Even when viewed from a purely contractual standpoint, the agreement’s terms suggest that the parties may have anticipated potential future judicial intervention,” Judge Terry Crone wrote of the case at hand. “Like the Swift court, we have no doubt that this injunction, though entered by consent, is subject to the trial court’s continuing equitable authority.”
The appellate court noted that the question of whether Novicki is entitled to such modification will be considered and resolved during the second phase of the proceedings under a more complete factual record.