B.J.'s Auto Wholesale, Inc., and John L. Medeiros a/k/a John Medeiros v. Automotive Finance Corporation d/b/a AFC Automotive Finance Corporation d/b/a AFC (mem. dec.) ( 2017 )


Menu:
  • MEMORANDUM DECISION
    Pursuant to Ind. Appellate Rule 65(D),
    this Memorandum Decision shall not be
    regarded as precedent or cited before any                                    FILED
    court except for the purpose of establishing                            Dec 07 2017, 6:41 am
    the defense of res judicata, collateral                                      CLERK
    Indiana Supreme Court
    estoppel, or the law of the case.                                           Court of Appeals
    and Tax Court
    ATTORNEY FOR APPELLANTS                                 ATTORNEY FOR APPELLEE
    Peter S. Kovacs                                         Joshua W. Casselman
    Peter Kovacs Law PC                                     Rubin & Levin, P.C.
    Fishers, Indiana                                        Indianapolis, Indiana
    IN THE
    COURT OF APPEALS OF INDIANA
    B.J.’s Auto Wholesale, Inc., and                        December 7, 2017
    John L. Medeiros a/k/a John                             Court of Appeals Case No.
    Medeiros,                                               49A05-1704-CC-885
    Appellants-Defendants,                                  Appeal from the Marion Superior
    Court
    v.                                              The Honorable Thomas J. Carroll,
    Judge
    Automotive Finance                                      Trial Court Cause No.
    Corporation d/b/a AFC                                   49D06-1610-CC-36619
    Automotive Finance
    Corporation d/b/a AFC,
    Appellee-Plaintiff.
    Robb, Judge.
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017           Page 1 of 17
    Case Summary and Issues
    [1]   B.J.’s Auto Wholesale, Inc. (“B.J.’s Auto”) and John Medeiros appeal the trial
    court’s judgment in favor of Automotive Finance Corporation (“AFC”). B.J.’s
    Auto and Medeiros raise four issues for our review which we consolidate and
    restate as: (1) whether the trial court erred in entering summary judgment in
    favor of AFC; (2) whether the trial court erred in granting AFC’s motion to
    strike; and (3) whether the trial court afforded B.J.’s Auto a fair opportunity to
    retain counsel in Indiana. Concluding the trial court did not err in granting
    summary judgment in favor of AFC, did not err in granting AFC’s motion to
    strike, and afforded B.J.’s Auto sufficient time to retain counsel, we affirm the
    judgment of the trial court.
    Facts and Procedural History
    [2]   AFC is a corporation that provides financing to car dealerships. AFC provides
    loans to dealerships to purchase vehicles, which the dealerships then sell to a
    consumer. In return, AFC receives a security interest in a dealership’s
    inventory.
    [3]   B.J.’s Auto is a used car dealership in Palmetto, Florida. Medeiros is the
    president of B.J.’s Auto. In January of 2011, AFC and B.J.’s Auto entered into
    a Promissory Note and Security Agreement (“Agreement”). To secure its
    obligations under the Agreement, B.J.’s Auto granted AFC a purchase money
    security interest in the vehicles purchased by B.J.’s Auto. The Agreement
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017   Page 2 of 17
    provides B.J.’s Auto “shall hold the amount received from the disposition of
    inventory in Trust for the benefit of [AFC].” Appellant’s Appendix, Volume 2
    at 25. The Agreement further provides B.J.’s Auto “shall pay to [AFC] . . . an
    amount equal to the unpaid balance of the Purchase Money Inventory
    Obligations . . . .” Id. Medeiros personally guaranteed payment of B.J.’s
    Auto’s obligations under the Agreement. See id. at 33-34.
    [4]   On October 14, 2016, AFC filed its three-count complaint against B.J.’s Auto
    and Medeiros. Count I alleged breach of contract against B.J.’s Auto for failure
    to make payments according to the terms of the Agreement and alleged an
    unpaid balance of $24,808; Count II alleged breach of contract against
    Medeiros as guarantor of the Agreement; and Count III alleged conversion
    against Medeiros and B.J.’s Auto for failing to hold the proceeds of the sale of
    inventory in trust for the benefit of AFC. Count III also sought treble damages
    under the Indiana Crime Victims Relief Act (“CVRA”). On November 7, 2016,
    Medeiros filed pro se appearances, on behalf of himself and B.J.’s Auto, and
    sought an extension of time to interview and hire counsel in Indiana.
    [5]   On November 23, 2016, AFC filed its motion for summary judgment. In
    support of its motion, AFC designated the affidavit of Jerry Bosl, its senior
    collections manager. Bosl’s affidavit provided the unpaid balance under the
    Agreement was $19,818, plus accrued fees of $1,310 and interest. The trial
    court then issued an order on December 2, 2016, admonishing Medeiros and
    reminding him that although he may proceed pro se, a corporation must be
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017   Page 3 of 17
    represented by an attorney under Indiana law. Ten days later, Medeiros filed a
    pro se answer and counterclaim on behalf of himself and B.J.’s Auto.
    [6]   In late December, Medeiros filed an affidavit in opposition to AFC’s motion for
    summary judgment.1 The affidavit was of his wife, Terry Medeiros, wherein
    she stated as vice president of B.J.’s Auto, she is responsible for making all
    contractual payments. Terry disputed that a failure to make payments or
    default under the Agreement had occurred. Shortly thereafter, AFC filed two
    motions seeking to strike: (1) B.J.’s Auto’s appearance, answer, and
    counterclaim; and (2) the affidavit in opposition to AFC’s motion for summary
    judgment. On January 10 and 12, 2017, the trial court granted AFC’s motions
    to strike. The trial court’s order dated January 12, 2017, striking B.J.’s Auto’s
    appearance, granted B.J.’s Auto “ten (10) days from the date of [the] Order to
    retain counsel and file a proper appearance or risk the entry of a judgment by
    default.” Id. at 141. The trial court also issued an order setting AFC’s motion
    for summary judgment for hearing. That order, dated January 13, 2017, set the
    summary judgment hearing for February 24, 2017, and reminded B.J.’s Auto
    “the Corporation must be represented by an attorney” at the hearing. Id. at
    143.
    [7]   Despite these warnings, B.J.’s Auto did not retain counsel. Instead, Medeiros
    filed an affidavit, a motion to reconsider, and a motion to continue hearing on
    1
    Medeiros apparently attempted to file two affidavits, the affidavit of his wife, Terry Medeiros, and his own
    affidavit. Medeiros personal affidavit was not recorded and does not appear in the appendix.
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017            Page 4 of 17
    January 17, January 23, and February 20, 2017, respectively. The trial court
    denied Medeiros’ motion to continue the hearing and neither Medeiros nor any
    attorney appeared at the summary judgment hearing. Following the hearing,
    the trial court entered judgment against Medeiros and B.J.’s Auto on all claims.
    The judgment against Medeiros and B.J.’s Auto totaled $68,736.
    [8]   On March 27, 2017, counsel filed an appearance for Medeiros and B.J.’s Auto
    and also filed a motion to correct error. Like this appeal, the motion alleged:
    (1) AFC failed to present evidence of mens rea necessary to support treble
    damages under the CVRA; (2) entry of summary judgment for conversion was
    in error; (3) the trial court erred in striking Medeiros’ affidavit; and (4) the trial
    court failed to allow sufficient time for B.J.’s Auto to hire counsel. The trial
    court denied Medeiros and B.J.’s Auto’s motion to correct error. Medeiros and
    B.J.’s Auto now appeal.
    Discussion and Decision
    I. Summary Judgment v. Default Judgment
    [9]   As an initial matter, we address AFC’s argument that B.J.’s Auto’s appeal of
    the default judgment is not properly before this court. AFC alleges because the
    trial court entered default judgment against B.J.’s Auto, the proper procedure
    was for B.J.’s Auto to file a motion for relief from judgment, not a motion to
    correct error. In support of its argument, AFC cites Siebert Oxidermo, Inc. v.
    Shields, 
    446 N.E.2d 332
     (Ind. 1983). There, our supreme court held,
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017   Page 5 of 17
    [T]he proper procedure in the Indiana Rules of Trial Procedure
    for setting aside an entry of default or grant of default judgment
    thereon is to first file a Rule 60(B) motion to have the default or
    default judgment set aside. Upon ruling on that motion by the
    trial court the aggrieved party may then file a Rule 59 Motion to
    Correct Error alleging error in the trial court’s ruling on the
    previously filed Rule 60(B) motion. Appeal may then be taken
    from the court’s ruling on the Motion to Correct Error.
    
    Id. at 337
    . Although we agree with AFC this is the proper procedure for setting
    aside a default judgment, the trial court entered judgment pursuant to summary
    judgment proceedings in this case.
    [10]   In Anderson v. Broadmoor Corp., 
    173 Ind. App. 290
    , 
    363 N.E.2d 1042
     (1977), this
    court faced a factually similar scenario. Broadmoor filed a complaint against
    Anderson alleging breach of contract and fraud. Anderson answered the
    complaint denying the breach and the fraud. Eventually, Anderson’s attorney
    filed a motion to withdraw representation and the trial court granted that
    motion. Two weeks later, Broadmoor filed its motion for summary judgment
    and the trial court set the motion for a hearing. Neither Anderson nor his
    counsel appeared at the hearing and the trial court entered judgment in favor of
    Broadmoor, noting Anderson’s notice of the proceedings and failure to appear.
    Anderson then hired counsel and appealed, alleging the trial court did not
    properly follow default judgment procedures.
    [11]   On appeal, this court noted that although the trial court used the “default
    terminology,” that did not alter the fact the proceedings in the trial court were
    conducted pursuant to a proper motion for summary judgment. Id. at 293, 363
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017   Page 6 of 17
    N.E.2d at 1044 (quotations omitted). We further noted the “record clearly
    shows that the court made its decision upon a summary judgment motion and
    upon summary judgment grounds.” Id. at 295, 363 N.E.2d at 1045.
    [12]   Likewise, the trial court here entered judgment in favor of AFC on all claims
    following the hearing on AFC’s motion for summary judgment. Although the
    trial court’s January 12, 2017 order threatens use of “judgment by default,” and
    its February 24, 2017 order is titled “default judgment,” it does not change the
    fact the trial court’s judgment was entered pursuant to a motion for summary
    judgment and upon summary judgment grounds. Appellant’s App., Vol. 2 at
    12, 141. Further, the record and Chronological Case Summary (“CCS”) do not
    reveal AFC ever filed a motion for default judgment. See Ind. Trial Rule 55(B)
    (“In all cases the party entitled to a judgment by default shall apply to the court
    therefor . . . .”). Because the judgment was entered pursuant to summary
    judgment proceedings, B.J.’s Auto was not required to file a Trial Rule 60(B)
    motion for relief from judgment. See Larson v. Karagan, 
    979 N.E.2d 655
    , 658
    (Ind. Ct. App. 2012) (appealing the entry of summary judgment from a motion
    to correct error).
    II. Summary Judgment
    A. Standard of Review
    [13]   We review summary judgment orders de novo. Holiday Hosp. Franchising, Inc. v.
    AMCO Ins. Co., 
    983 N.E.2d 574
    , 577 (Ind. 2013). Summary judgment is
    appropriate if the designated evidence shows there is no genuine issue as to any
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017   Page 7 of 17
    fact material to a particular issue or claim, and the moving party is entitled to
    judgment as a matter of law. Ind. Trial Rule 56(C). In viewing the matter
    through the same lens as the trial court, we construe all designated evidence
    and reasonable inferences therefrom in favor of the non-moving party. Holiday
    Hosp. Franchising, 983 N.E.2d at 577. The party appealing the trial court’s
    summary judgment determination bears the burden of persuading us the ruling
    was erroneous. Mullin v. Mun. City of S. Bend, 
    639 N.E.2d 278
    , 280-81 (Ind.
    1994). Nonetheless, we “carefully scrutinize[ ] the trial court’s decision to
    assure that the party against whom summary judgment was entered was not
    improperly prevented from having its day in court.” Id. at 281.
    B. Treble Damages and Conversion
    [14]   B.J.’s Auto and Medeiros make two arguments with respect to the trial court’s
    entry of summary judgment: (1) they assert because the trial court awarded
    treble damages pursuant to CVRA,2 our supreme court’s opinion in Klinker v.
    First Merchants Bank NA, 
    964 N.E.2d 190
     (Ind. 2012), controls and mandates a
    showing of the requisite mens rea, which they allege AFC failed to demonstrate
    2
    The CVRA provides that “[i]f a person . . . suffers a pecuniary loss as a result of [conversion], the person
    may bring a civil action against the person who caused the loss for . . . [a]n amount not to exceed three (3)
    times the actual damages of the person suffering the loss . . . .” 
    Ind. Code § 34-24-3-1
    (1)(A). The crime of
    conversion occurs when a person “knowingly or intentionally exerts unauthorized control over property of
    another person . . . .” 
    Ind. Code § 35-43-4-3
    (a). Further, a criminal conviction is not a condition precedent
    to recovery under the CVRA. Rather, the claimant merely must prove each element of the underlying crime
    by a preponderance of the evidence. White v. Ind. Realty Assocs. II, 
    555 N.E.2d 454
    , 456 (Ind. 1990).
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017            Page 8 of 17
    here; and (2) conversion cannot be based on failure to pay a debt. We disagree
    with B.J.’s Auto and Medeiros.
    [15]   First, as noted by AFC, B.J.’s Auto failed to comply with multiple warnings
    from the trial court that it must be represented by an attorney pursuant to
    Indiana law. See 
    Ind. Code § 34-9-1-1
    (c). Despite these warnings, B.J.’s Auto
    failed to hire counsel and Medeiros attempted to represent the corporation
    himself. Because Medeiros is not a licensed attorney in Indiana and was
    statutorily unable to represent the corporation, the trial court granted AFC’s
    motion to strike B.J.’s Auto’s appearance, answer, counterclaims, and affidavit.
    Consequently, B.J.’s Auto failed to respond to AFC’s complaint. Indiana Rule
    of Trial Procedure 8(D) provides that “[a]verments in a pleading to which a
    responsive pleading is required . . . are admitted when not denied in the
    responsive pleading.” AFC’s complaint specifically alleged B.J.’s Auto and
    Medeiros converted its property and that it was therefore entitled to damages
    pursuant to the CVRA. By operation of Trial Rule 8(D), B.J.’s Auto admitted
    these allegations and that is sufficient to support the trial court’s award of treble
    damages under the CVRA. See Heartland Res., Inc. v. Bedel, 
    903 N.E.2d 1004
    ,
    1007-08 (Ind. Ct. App. 2009) (affirming an award of treble damages under the
    CVRA where the allegations in the complaint were taken as true when the trial
    court entered default judgment).
    [16]   Second, we disagree with B.J.’s Auto and Medeiros’ argument that AFC failed
    to demonstrate the requisite mens rea to support an award of treble damages
    under the CVRA or that its claim of conversion was solely based on a failure to
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017   Page 9 of 17
    pay a debt. In support thereof, B.J.’s Auto and Medeiros cite to Klinker v. First
    Merchs. Bank, NA, 
    964 N.E.2d 190
     (Ind. 2012). There, Klinker, the manager
    and operator of a used-car dealership (“Dealership”), entered into a financing
    agreement with First Merchants Bank (“FMB”). FMB provided loans to the
    Dealership in return for a security interest in the Dealership’s vehicle inventory.
    The financing agreement also provided that financed vehicles were to be held
    for resale at designated locations provided for in the agreement. Although the
    Dealership was permitted to retain control of the vehicles’ titles, it was
    prohibited from transferring or negotiating any documents of title without
    FMB’s consent.
    [17]   Thereafter, an audit of the Dealership’s inventory discovered thirty-one vehicles
    for which FMB had loaned purchase money were not in the Dealership’s
    possession and no proceeds from the sale or transfer of those vehicles had been
    paid to FMB. FMB discovered that some of the vehicles had been transferred
    to another dealer to be held and sold, but no proceeds from those transfers had
    been remitted to FMB. FMB filed a lawsuit against the Dealership and Klinker
    alleging fraud and seeking treble damages under the CVRA. Several months
    later, FMB moved for summary judgment alleging three “badges of fraud.”
    FMB alleged that (1) Klinker sold and transferred financed vehicles without
    paying down loans, thus rendering him insolvent; (2) Klinker sold vehicles
    contrary to standard business transactions when he did not deliver titles to
    buyers until well after sale; and (3) Klinker made sales/transfers without FMB’s
    knowledge in secret and hurried transactions. Id. at 194. The trial court
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017   Page 10 of 17
    entered summary judgment in favor of FMB concluding there were no genuine
    issues of material fact and that Klinker had defaulted and acted with intent to
    commit fraud.
    [18]   On appeal, our supreme court reversed the trial court’s entry of summary
    judgment in favor of FMB. Id. at 195. The court noted that to obtain summary
    judgment on its allegations of fraud, FMB must demonstrate the undisputed
    facts showed Klinker acted with “specific intent to defraud.” Id. at 194. In
    reversing the trial court, the court stated,
    Even assuming FMB’s designated evidence clearly establishes
    these alleged badges of fraud, it is not entitled to summary
    judgment. As we recently explained, the mens rea element for a
    criminal offense is almost inevitably, absent a defendant’s
    confession or admission, a matter of circumstantial proof.
    Therefore, finding criminal intent in the absence of a confession
    invariably requires weighing evidence, judging witness
    credibility, and drawing reasonable inferences from the facts, all
    of which are improper in considering a motion for summary
    judgment. Accordingly, summary judgment is almost never
    appropriate where the claim requires a showing that the
    defendant acted with criminal intent or fraudulent intent.
    Id. at 195 (internal citations and quotations omitted).
    [19]   Klinker is not directly on point and does not aid B.J.’s Auto and Medeiros. As
    noted, by failing to respond to the complaint, B.J.’s Auto admitted the
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017   Page 11 of 17
    complaint’s allegations.3 Moreover, unlike fraud, which requires a showing of
    specific intent to defraud, conversion requires the defendant act “knowingly or
    intentionally.” 
    Ind. Code § 35-43-4-3
    (a). “A person engages in conduct
    ‘knowingly’ if, when he engages in the conduct, he is aware of a high
    probability that he is doing so.” 
    Ind. Code § 35-41-2-2
    (b). In the case of
    conversion, the claimant must prove the control exercised over the property was
    unauthorized and the defendant was aware of a high probability the control was
    unauthorized. Midland-Guardian Co. v. United Consumers Club, Inc., 
    499 N.E.2d 792
    , 797-98 (Ind. Ct. App. 1986), trans. denied.
    [20]   AFC has alleged and demonstrated a high probability Medeiros exerted
    unauthorized control over AFC’s property. According to the terms of the
    Agreement, which was signed and personally guaranteed by Medeiros, B.J.’s
    Auto was required to “hold the amount received from the disposition of
    inventory in Trust for the benefit of [AFC].” Appellant’s App., Vol. 2 at 25.
    B.J.’s Auto and Medeiros did not do so and knowingly used the funds in a
    manner inconsistent with the Agreement. Without any designated evidence to
    3
    The complaint alleges B.J.’s Auto and Medeiros “knowingly and intentionally converted [AFC’s] property
    . . . .” Appellant’s App., Vol. 2 at 21.
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017      Page 12 of 17
    the contrary,4 we conclude there is no genuine issue of material fact and the trial
    court did not err in granting summary judgment in favor of AFC.5
    III. Affidavit of Terry Medeiros
    [21]   B.J.’s Auto and Medeiros also challenge the trial court’s order granting AFC’s
    motion to strike the affidavit of Terry Medeiros.
    [22]   AFC filed its motion for summary judgment on November 23, 2016. Pursuant
    to Indiana Rule of Trial Procedure 56(C), B.J.’s Auto and Medeiros had thirty
    days to respond to the motion. Trial Rule 6(E) provides a party with three
    additional days to respond if they are served by mail. Therefore, B.J.’s Auto
    and Medeiros had thirty-three days to timely file their response and any
    4
    Again, we note the trial court struck the affidavit of Terry Medeiros for being untimely filed. We address
    the issue of its exclusion below.
    5
    We further disagree with B.J.’s Auto and Medeiros’ argument the judgment for conversion was based solely
    on failure to pay a debt. See Bowden v. Agnew, 
    2 N.E.3d 743
    , 751 (Ind. Ct. App. 2014) (holding conversion
    may not be based on failure to pay a debt). In Kopis v. Savage, 
    498 N.E.2d 1266
     (Ind. Ct. App. 1986), Kopis
    received a $40,000 deposit from Savage toward the purchase price of certain property. Kopis comingled the
    deposit with other unrelated accounts and refused to refund the money to Savage when the deal fell through.
    
    Id. at 1269
    . Kopis argued on appeal that his actions were a refusal to pay a debt and did not support an
    action for conversion. We agreed with Kopis, but noted that money may be the subject of an action for
    conversion, so long as it is capable of being identified as a special chattel. 
    Id. at 1270
    . We concluded Kopis
    no longer had a property interest in the specific funds and observed,
    The parties did not agree to set up an escrow account or to deliver the money to any third
    party for safekeeping. We can find nothing in the conduct of the parties or in the wording
    of the receipt which indicates the parties intended for Savage to retain any ownership or
    possessory rights in the $40,000.
    
    Id. at 1270
    . Here, by the terms of the Agreement and Indiana Code section 26-1-9.1-315(a)(2), AFC retained
    a security interest in B.J.’s Auto’s inventory and the proceeds from that inventory. See 
    Ind. Code § 26-1-9.1
    -
    315(a)(2) (“[A] security interest attaches to any identifiable proceeds of collateral.”). The claim of conversion
    is not based upon a failure to pay a debt, but on failing to hold the funds in trust for the benefit of AFC and
    using them in a manner inconsistent with the Agreement. See Clark-Silberman v. Silberman, 
    78 N.E.3d 708
    ,
    718 (Ind. Ct. App. 2017) (holding wife converted trust property when she removed cash from safe deposit
    box without authorization).
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017             Page 13 of 17
    affidavits. Thirty-three days from November 23, 2016 is December 26, 2016.
    Because the trial court was closed on December 26, the proper date to file the
    motion in response to summary judgment was extended to December 27, 2016.
    See Ind. Trial Rule 6(A).
    [23]   The affidavit of Terry Medeiros submitted by Medeiros is file stamped
    December 29, 2016. The CCS also indicates it was filed on that date. B.J.’s
    Auto and Medeiros allege they filed the affidavit on December 27, 2016,
    pursuant to Indiana Rule of Trial Procedure 5(F), which provides that “[f]iling
    by registered or certified mail . . . shall be complete upon mailing or deposit.”
    However, we have no basis to conclude B.J.’s Auto and Medeiros filed their
    motion by registered or certified mail on December 27. In its motion to correct
    error, counsel for the defendants provided tracking data and a shipping receipt
    which are included in the Appellant’s Appendix. See Appellant’s App., Vol. 2
    at 200-01. But the receipt and tracking data are poorly scanned and largely
    unreadable. Indiana Rule of Appellate Procedure 51(A) provides the “copying
    process used [for appendices] shall produce text in a distinct black image . . . .”
    Although failure to comply with the appellate rules does not necessarily result
    in waiver of the issues presented, it is appropriate where, as here, such
    noncompliance impedes our review. See In re Moeder, 
    27 N.E.3d 1089
    , 1097 n.4
    (Ind. Ct. App. 2015), trans. denied. Moreover, from what we are able to gather
    from the shipping receipt, it was sent by express mail, which is not considered
    filed upon mailing or receipt. See T.R. 5(F). Additionally, other items properly
    filed by B.J.’s Auto and Medeiros pursuant to Indiana Rule of Trial Procedure
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017   Page 14 of 17
    5(F) are noted as such in the CCS; the affidavit of Terry Medeiros is not noted
    in the CCS as being filed pursuant to this rule. Accordingly, we conclude the
    trial court did not err in striking the affidavit from the record. 6
    IV. Time to Retain Counsel
    [24]   Finally, B.J.’s Auto alleges it was not granted sufficient time to retain local
    counsel in Indiana and the trial court’s judgment must therefore be reversed. In
    support of its argument, B.J.’s Auto cites to Christian Bus. Phone Book, Inc. v.
    Indianapolis Jewish Cmty. Relations Council, 
    576 N.E.2d 1276
     (Ind. Ct. App.
    1991).
    [25]   There, Christian Business Phone Book, Inc. (“Corporation”) filed a complaint
    against the Indianapolis Jewish Community Relations Council (“Council”) on
    May 16, 1990. Almost two months later, the attorneys for the Council filed an
    answer and a motion to dismiss. The Council’s motion was based on the
    failure of the Corporation to appear by attorney as required by Indiana law.
    The trial court then set the matter for hearing on September 10, 1990, and
    counsel for the Corporation filed an appearance on the same day as the hearing.
    After the hearing, the trial court granted the Council’s motion to dismiss.
    6
    B.J.’s Auto and Medeiros also contend the trial court erred in failing to abide by its own local rule.
    Specifically, they allege the trial court failed to give them fifteen days to respond to AFC’s motion to strike as
    provided by Marion County Local Rule LR49-TR5-203(B). We conclude any error in the trial court’s
    striking the affidavit is harmless error. As noted, the trial court struck the affidavit for being untimely filed
    and because of the poor quality of the shipping receipt in the appendix, we have no basis to conclude the
    affidavit was timely filed. See Ind. Trial Rule 61 (providing that errors that do not prejudice the substantial
    rights of a party will not support the reversal of judgment on appeal).
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017              Page 15 of 17
    [26]   On appeal, the Council argued that because the Corporation filed its complaint
    without the benefit of an attorney, the trial court properly dismissed the case
    even though an attorney had appeared for the Corporation. 
    Id. at 1277
    . This
    court disagreed and reversed the trial court’s dismissal of the complaint stating:
    We cannot support such a terminal result here. Dismissal is a
    remedy which is not favored in this state because “in our system
    of justice the opportunity to be heard is a litigant’s most precious
    right and should be sparingly denied.” In numerous cases, our
    appellate courts have held that dismissal should not be granted
    unless less drastic sanctions will not suffice.
    [27]   
    Id.
     (internal citations omitted). We noted in previous cases where appellate
    courts affirmed a trial court’s dismissal following a corporation’s failure to be
    represented by counsel, the trial court “had given the corporation the
    opportunity, which the corporation refused, to retain proper representation
    before dismissing the action.” 
    Id.
     Thus, we stated a corporate litigant must be
    given a fair opportunity to retain counsel before a trial court may dismiss the
    complaint. 
    Id.
     This court held that the trial court abused its discretion by
    dismissing the Corporation’s complaint after an attorney had appeared for the
    corporation. 
    Id.
    [28]   The facts of this case are distinguishable from Indianapolis Jewish Community
    Relations Council and do not support reversal of the trial court’s decision in this
    case. AFC filed its complaint on October 16, 2016. The trial court entered its
    judgment on February 24, 2017, and counsel for B.J.’s Auto and Medeiros did
    not file an appearance until March 27, 2017. During these six months, the trial
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017   Page 16 of 17
    court warned Medeiros and B.J.’s Auto, at least three times, that a corporation
    must be represented by counsel. Notwithstanding these warnings, Medeiros
    continued to file pleadings and motions on behalf of the corporation. The
    record does not reveal any explanation by B.J.’s Auto for why it was unable to
    hire counsel within five months. Moreover, in Indianapolis Jewish Community
    Relations Council, this court specifically held the trial court abused its discretion
    in dismissing a corporate cause of action after an attorney had appeared for the
    Corporation. 
    Id. at 1277
    . No attorney appeared for B.J.’s Auto until six
    months after the litigation commenced and after judgment was entered. The
    trial court was more than accommodating in affording B.J.’s Auto a fair
    opportunity to hire counsel in this case. Therefore, we conclude the trial court
    permitted sufficient time for B.J.’s Auto to hire counsel.
    Conclusion
    [29]   We conclude the trial court did not err in entering summary judgment in favor
    of AFC or in granting AFC’s motion to strike. In addition, the trial court
    permitted sufficient time for B.J.’s Auto to retain counsel, but it failed to do so.
    Accordingly, we affirm the judgment of the trial court.
    [30]   Affirmed.
    Riley, J., and Pyle, J., concur.
    Court of Appeals of Indiana | Memorandum Decision 49A05-1704-CC-885 | December 7, 2017   Page 17 of 17
    

Document Info

Docket Number: 49A05-1704-CC-885

Filed Date: 12/7/2017

Precedential Status: Precedential

Modified Date: 12/7/2017