Case Notes: Recent Court Decisions

Chad J. Melchi - 9/29/2008

1. Foreclosure Actions.  A materials supplier brought an action to foreclose a mechanics lien in Superior Court.  A mortgagor brought an action to foreclose on a mortgage concerning the same real property in Circuit Court.  The Circuit Court denied the materials supplier's motion to consolidate the two actions and, subsequently, entered summary judgment in favor of the mortgagor.  The materials supplier appealed.
   
   The appellate court affirmed the trial court's ruling, holding that: (1) the materials supplier waived any claim on appeal that the Superior Court had exclusive jurisdiction over the case, and (2) by failing to file a response to the mortgagor's complaint, the materials supplier admitted the mortgagor's allegation in its complaint that mortgagor had a superior interest in the property and that materials supplier had no interest in property.  Irmscher Suppliers, Inc. v. Capital Crossing Bank, 887 N.E.2d 97 (Ind. Ct. App. 2008).
   
   
2. Mechanic's Lien Foreclosure.  A contractor brought an action against a homeowner to foreclose on a mechanic's lien.  After a bench trial, the court entered orders granting the contractor's request to foreclose on his lien, and awarded attorney's fees to the contractor.  Further, the trial court denied the homeowner's motion to amend pleadings to conform to the evidence.  The homeowner appealed.
   
   The appellate court affirmed, holding that: (1) homeowner was not entitled to conform his pleadings to add an unlitigated defense under the Indiana Home Improvement Contracts Act (HICA); (2) evidence was sufficient to show that the contractor's notice of intent to hold a mechanic's lien was timely; (3) the trial court did not abuse its discretion in permitting the contractor to deviate from a pretrial order for the purposes of demonstrating its attorney's fees; and (4) the contractor was not entitled to prejudgment interest.  Woodward v. Heritage Construction Co., Inc., 887 N.E.2d 994 (Ind. Ct. App. 2008).
   
   
3. Employment Injury.  An injured iron worker brought a negligence claim against a corporate masonry subcontractor and the corporation's shareholder alleging that he fell when support rebar set by the masonry subcontractor broke while he was adjusting the rebar set by the masonry subcontractor.  The trial court granted summary judgment for the masonry contractor defendants and the injured employee plaintiff appealed.
   
   The appellate court affirmed in part, reversed in part, and remanded, holding that: (1) the iron worker's injury was reasonably foreseeable for purposes of duty of care, and (2) fact issues regarding proximate cause precluded summary judgment for the masonry contractor defendants.  Briesacher v. Specialized Restoration and Construction, Inc., 888 N.E.2d 188 (Ind. Ct. App. 2008).
   
   
4. Inverse Condemnation Claim.   A landowner, a hotel operator, filed an inverse condemnation claim against the State of Indiana after the State constructed a roadway median that cut off direct access from the highway to the landowner's hotel entrance from the southbound lane of highway.  Both parties filed for summary judgment.  The trial court entered partial summary judgment in favor of the landowner finding "a taking" had occurred, and then entered a damages award in accordance with the jury verdict.  The State appealed.
   
   The appellate court reversed the trial court's ruling, holding that the State construction of a roadway median affected traffic flow, rather than ingress and egress and, therefore, did not constitute a compensable "taking" of privately owned land.  State v. Dunn, 888 N.E.2d 858 (Ind. Ct. App. 2008).
   
   
5. Construction Law.   A homeowner brought an action against a homebuilder asserting claims for breach of warranty, breach of contract, and negligence.  After the parties entered into a settlement agreement, the homeowner filed motion to recover his attorney's fees pursuant to the construction contract.  The trial court found that the homeowner was not the prevailing party and, thus, not entitled to recover his attorney's fees.  The homeowner appealed and the appellate court affirmed.  Transfer was granted.
   
   The Indianan Supreme Court affirmed holding that the homeowner was not a prevailing party.  The parties entered into a construction contract providing that, in the event of a legal dispute, the prevailing party would be entitled to recover its reasonable costs and expense, including attorney fees.  The term "prevailing party" was not defined in the construction contract.  The Court determined that in the absence of further definition, such a contract produces fees only when one party or the other wins a judgment.   Reuille v. E.E. Brandenberger Const., Inc., 888 N.E.2d 770 (Ind. 2008).
   
   
6. Preliminary Injunction.  The Shareholders of the plaintiff funeral home brought an action on behalf of the plaintiff funeral home against a defendant funeral home and its operator, seeking a preliminary injunction to prevent the operation of the defendant funeral home and to prevent the defendant from using a name similar to the name of the plaintiff's funeral home.  A co-shareholder in the plaintiff funeral home filed a counterclaim against the plaintiff shareholders, requesting a judicial dissolution and requesting the appointment of a receiver alleging breach of fiduciary duty.  The trial court denied the request for a preliminary injunction and appointed a custodian over the plaintiff funeral home pending a hearing on the merits of the counterclaim.  The plaintiff funeral home and shareholders appealed.
   
   The appellate court affirmed, holding that: (1) the evidence was sufficient to support a finding that the operator of the defendant funeral home had not been an officer of the plaintiff funeral home; (2) the president of the management consulting firm was not qualified as an expert witness to speak on the issue of the likelihood of confusion with the use of similar names; (3) the president was not qualified as a skilled witness; (4) anecdotal testimony regarding confusion was insufficient to require preliminary injunction; and (5) the court could appoint a custodian.  Burns-Kish Funeral v. Kish Funeral Homes, 889 N.E.2d 15 (Ind. Ct. App. 2008).
   
   
7. Employment Law.   A former employee brought an action against his former employer, a construction products manufacturer business, seeking declaratory judgment that a non-compete clause was unenforceable, and for damages for tortious interference with a business relationship, breach of contract, and violation of state "blacklisting" statute.  The former employee also asserted a defamation claim against his former supervisor.  The employer counterclaimed, alleging breach of contract and violation of trade secrets, and asserted a third-party claim against the former employee's newly formed business, alleging tortious interference.  The trial court entered summary judgment against the former employee on all claims.  The former employee appealed.
   
   The appellate court affirmed in part, reversed in part and remanded with instructions, holding that: (1) former employee did not breach a non-compete clause by competing with the employer's subsidiary; (2) former employee was not constructively discharged so as to form the basis of a wrongful discharge claim; (3) statement from the former supervisor was slanderous per se so as to create a triable defamation claim; and (4) a triable issue existed as to whether the former employee was damaged by the former employer's alleged tortious interference with business relationships.  Baker v. Tremco Inc., 890 N.E.2d 73 (Ind. Ct. App. 2008).