Richard R. Hogshire v. Ursula Hoover ( 2014 )

Pursuant to Ind.Appellate Rule 65(D), this
Memorandum Decision shall not be
regarded as precedent or cited before any Oct 09 2014, 9:56 am
court except for the purpose of establishing
the defense of res judicata, collateral
estoppel, or the law of the case.
ATTORNEYS FOR APPELLANT: ATTORNEY FOR APPELLEE:
PRESTON T. BREUNIG CHRISTOPHER M. GILLEY
MARTHA L. WESTBROOK Anderson, Indiana
Buck Berry Landau & Breunig P.A.
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
RICHARD R. HOGSHIRE, )
)
Appellant-Petitioner, )
)
vs. ) No. 06A01-1312-DR-513
)
URSULA HOOVER, )
)
Appellee-Respondent. )
APPEAL FROM THE BOONE SUPERIOR COURT
The Honorable Matthew C. Kincaid, Judge
Cause No. 06D01-1202-DR-74
October 9, 2014
MEMORANDUM DECISION – NOT FOR PUBLICATION
RILEY, Judge
STATEMENT OF THE CASE
Appellant-Petitioner, Richard R. Hogshire (Husband), brings this interlocutory
appeal challenging the trial court’s Findings of Fact, Conclusions of Law and Judgment
(Judgment), in which it held Husband in contempt for failing to pay Appellee-Respondent,
Ursula Hoover (Wife), in accordance with prior Provisional Orders.
We affirm and remand.
ISSUES
Husband raises two issues on appeal, which we restate as follows:
(1) Whether the trial court erred by holding Husband in contempt; and
(2) Whether Husband is obligated to pay Wife’s attorney fees in light of our court’s
reversal of the Provisional Orders underlying the contempt action.
FACTS AND PROCEDURAL HISTORY
On January 5, 2012, Husband filed a petition to dissolve his fourteen-year marriage
to Wife. In response, Wife filed a counter-petition for divorce on January 13, 2012.
Husband and Wife, who are seventy-seven and seventy-five years old, respectively, do not
have any children together. The lion’s share of the marital assets consists of the marital
residence in Indianapolis, Indiana, as well as several businesses in Husband’s name.
Following the parties’ cross-petitions for dissolution, on April 30, 2012, the trial
court conducted a provisional hearing and received evidence regarding the financial
circumstances of both Husband and Wife. The next day, the trial court issued a provisional
order (Provisional Order #1), which awarded temporary possession of the marital residence
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to Husband. Provisional Order #1 also required, in part, that Husband pay $300 per month
to Wife in temporary maintenance and that he provide her with $5,000 in order to retain a
business valuation expert.
On October 9, 2012, Wife filed a petition for emergency relief and modification of
Provisional Order #1. On November 16, 2012, after a second provisional hearing, the trial
court issued a modified provisional order (Provisional Order #2), which extinguished
Husband’s obligation to make monthly maintenance payments. Instead, the trial court
awarded Wife temporary possession of the marital residence and ordered Husband to pay
all of the expenses related thereto, including the mortgage payment. In addition to
maintaining its initial order that Husband pay $5,000 for a business valuation expert, the
trial court, acting sua sponte, also ordered Husband to pay $10,000 toward Wife’s attorney
fees. On November 21, 2012, Husband filed a motion for the trial court to reconsider its
ruling, which the trial court denied on November 30, 2012.
On December 17, 2012, Husband filed his first interlocutory appeal, challenging the
trial court’s award of $15,000 in preliminary fees and costs. See Hogshire v. Hoover
(Hogshire I), 2013 WL 6198238 (Ind. Ct. App. Nov. 27, 2013). On January 7, 2013,
Husband asked for a stay of Provisional Order #2 pending appeal, which the trial court
granted on February 4, 2013, subject to the condition that Husband post a $7,500 bond.
Husband concedes that he never posted this bond.
At some point after the issuance of Provisional Order #2, Husband and Wife sold
the marital residence and deposited the proceeds into an escrow account for division at the
final hearing. No longer able to live in the marital residence at Husband’s expense, Wife
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filed a petition to modify Provisional Order #2 on May 16, 2013. Following a third
provisional hearing on June 24, 2013, the trial court issued Provisional Order #3 on
September 6, 2013. In Provisional Order #3, the trial court ordered Husband to pay weekly
maintenance of $750 to Wife, as well as to pay all of the outstanding fees for the completion
of the business valuation. Ten days later, Husband filed his second interlocutory appeal to
challenge the rulings of Provisional Order #3. See Hogshire v. Hoover (Hogshire II), 2014
WL 2927270 (Ind. Ct. App. June 27, 2014). Again, Husband requested a stay pending
appeal, which the trial court denied on October 1, 2013.1
On September 24, 2013, following Husband’s failure to remit his first two
maintenance payments, Wife filed a motion for rule to show cause, alleging Husband to be
“willfully and intentionally in contempt of” Provisional Order #3. (Appellant’s App. p.
21). Then, on October 3, 2013, Wife filed a second petition for contempt, claiming that
Husband never posted the $7,500 cash bond required to stay his obligation to pay $15,000
per Provisional Order #2. In addition to requesting that the court enforce Husband’s
compliance with the terms of both Provisional Orders, both of Wife’s petitions included a
demand for attorney fees incurred as a result of prosecuting the contempt. On October 25,
2013, the trial court conducted a hearing, during which both parties testified regarding their
financial circumstances. Husband stipulated to the fact that he has not made payments in
accordance with either of the Provisional Orders but asserted that his actions did not
constitute contempt based on his financial inability to comply. Wife, however, insisted
1
On October 25, 2013, our court denied Husband’s emergency motion to set an appeal bond and for a stay
pending appeal.
4
that Husband’s financial declaration fails to reflect the full extent of his available funds
and that he is capable of making the maintenance, attorney fee, and business valuation
payments as ordered.
On November 5, 2013, the trial court entered its Judgment. In holding Husband in
contempt, the trial court determined that “[h]e is willfully rejecting his responsibility to
pay for [W]ife’s [business valuation] expert and to pay her maintenance.” (Appellant’s
App. p. 15). As a result, the trial court ordered Husband to pay $4,000 for the attorney fees
Wife incurred in bringing the contempt action. Also, the trial court ordered that the
escrowed proceedings from the sale of the marital residence be used to satisfy Husband’s
obligation under Provisional Order #2 in the amount of $15,000, as well as for any
maintenance payments owing under Provisional Order #3.
On November 27, 2013, our court rendered its decision in Hogshire I, holding that
although it is permissible for a trial court to sua sponte award $10,000 in attorney fees, the
trial court had abused its discretion by doing so in Provisional Order #2 without first
hearing evidence on Husband’s financial circumstances. We remanded to the trial court
for an examination of the parties’ resources. Seven months later, we issued our decision
in Hogshire II. There, we reversed the portion of Provisional Order #3 requiring Husband
to pay $750 in weekly maintenance “and remand[ed] with instructions to modify the
maintenance award taking into account Husband’s earnings, living expenses, and other
obligations imposed by the court’s provisional orders.” Hogshire II, 2014 WL 2927270,
at *4. We further concluded that the trial court had abused its discretion by ordering
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Husband to pay for the outstanding and future fees of the business valuation expert based,
in part, on Husband’s inability to pay.
Husband now appeals.2 Additional facts will be provided as necessary.
DISCUSSION AND DECISION
I. Standard of Review
Where, as here, a party requests special findings and conclusions under Indiana Trial
Rule 52(A), our two-tiered standard of review is well established. First, we consider
whether the evidence supports the findings; second, we determine whether those findings
support the trial court’s judgment. Maxwell v. Maxwell, 850 N.E.2d 969, 972 (Ind. Ct.
App. 2006), trans. denied. On review, our court “shall not set aside the findings or
judgment unless clearly erroneous, and due regard shall be given to the opportunity of the
trial court to judge the credibility of the witnesses.” Ind. Trial Rule 52(A). We will find
clear error “only where there is no evidence supporting the findings or the findings do not
support the judgment.” Maxwell, 850 N.E.2d at 972. Findings are clearly erroneous “only
when a review of the record leaves us firmly convinced a mistake has been made”; a
judgment is clearly erroneous where “it relies on an incorrect legal standard.” Id. We will
not reweigh evidence, and we consider only the evidence most favorable to the trial court’s
judgment. Id.
2
Husband filed his Notice of Appeal in the present case on December 4, 2013—after Hogshire I was
decided, but prior to Hogshire II. Regardless, at the time the trial court issued its Judgment, both Provisional
Orders remained in full force and effect.
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When a request is made pursuant to Indiana Trial Rule 52(A), the trial court must
“make complete special findings sufficient to disclose a valid legal basis under the issues
for the legal result reached in the judgment.” Id. Findings and conclusions serve to provide
both the parties and appellate courts “with the theory upon which the case was decided.”
Id. As such, the trial court’s findings must “contain all of the facts necessary for a judgment
for the party in whose favor conclusions of law are found.” Erb v. Erb, 815 N.E.2d 1027,
1030 (Ind. Ct. App. 2004).
II. Contempt
Husband claims that the trial court erred in holding him in contempt for violating
the Provisional Orders. Contempt “involves disobedience of a court which undermines the
court’s authority, justice, and dignity.” Henderson v. Henderson, 919 N.E.2d 1207, 1210
(Ind. Ct. App. 2010). Determining whether a party is in contempt of a court order is a
matter reserved to the sound discretion of the trial court. Cowart v. White, 711 N.E.2d 523,
530-31 (Ind. 1999). We will reverse a contempt finding only where no evidence or
inferences to be drawn from the evidence support it. Id. at 531.
“Uncontradicted evidence that a party is aware of a court order and willfully
disobeys it is sufficient to support a finding of contempt.” Evans v. Evans, 766 N.E.2d
1240, 1243 (Ind. Ct. App. 2002). Because contempt proceedings are meant “to vindicate
the courts’ dignity and to enforce litigants’ rights pursuant to court orders[,]” the propriety
of a court’s order is generally irrelevant in deciding whether a party willfully defied it.
Crowl v. Berryhill, 678 N.E.2d 828, 830 (Ind. Ct. App. 1997). That said, we note the
distinction between void and erroneous orders. If an order is issued by a court that lacks
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jurisdiction, that order is void and may not serve as the basis of a contempt citation. Carson
v. Ross, 509 N.E.2d 239, 243 (Ind. Ct. App. 1987), trans. denied. On the other hand, an
order is merely erroneous if an appellate court deems it unenforceable “based upon non-
jurisdictional irregularities.” Id. “[A]n erroneous order must be obeyed unless and until
reversed on appeal. A party’s remedy for an erroneous order is appeal; disobedience of the
order is contempt.” Martin v. Martin, 771 N.E.2d 650, 653 (Ind. Ct. App. 2002) (internal
citation omitted).
In the present case, the fact that our court ultimately reversed the mandates set forth
in both Provisional Orders is of no import in our review of Husband’s contempt citation.
As Husband has not raised any jurisdictional arguments, he may not now “challenge a
contempt finding based upon the prior [Provisional Orders’] non-jurisdictional
irregularities.” Carson, 509 N.E.2d at 243. The question before our court is simply
whether Husband willfully failed to comply with the Provisional Orders.
The uncontroverted evidence establishes that Husband was aware of his obligations
set forth in the Provisional Orders and, as the trial court found, that he “failed to pay the
$15,000 or even any fraction thereof” and also “failed to make the $750.00 per week
maintenance payments to Wife . . . except for one $749.71 payment to Wife after October
14, 2013 arising from the endorsement of a check refund to Husband from Privacy Guard.”
(Appellant’s App. pp. 11-12). Nevertheless, Husband maintains that his actions do not
constitute contempt. Rather, he insists that “he does not have the financial ability to comply
with the trial court’s order to pay the [$5,000] to Wife’s valuation expert and [$10,000] in
preliminary attorney fees . . . or the [$750] per week payments to Wife, or the unspecified
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dollar payment to [the business valuation expert].” (Appellant’s Br. p. 19). According to
Husband, this “impossibility of performance” precludes the finding of contempt.
(Appellant’s Br. p. 19). “Where a person seeks to show the court that his failure to obey
an order was due to an inability to render obedience, the burden is on him to establish this
fact.” Head v. Comm’r, Ind. Dep’t of Envtl. Mgmt., 626 N.E.2d 518, 526 (Ind. Ct. App.
1992), reh’g denied, trans. denied. To this end, Husband asserts that the trial court’s
findings are insufficient to uphold the contempt.
In particular, Husband employs Indiana Trial Rule 52(B) to argue that the trial
court’s factual findings are “lacking, incomplete, inadequate in form or content or do not
cover the issues raised by the pleadings or evidence.” T.R. 52(B)(2). We, however, find
that Husband’s reliance on Trial Rule 52(B) is misplaced. This rule provides that a trial
court—either “[u]pon its own motion at any time before a motion to correct errors (Rule
59) is required to be made, or with or as part of a motion to correct errors by any party”—
may open a judgment, hear additional evidence, modify or make additional findings, enter
a new judgment, “or any combination thereof if . . . special findings of fact required by this
rule are lacking, incomplete, inadequate in form or content or do not cover the issues raised
by the pleadings or evidence.” T.R. 52(B)(2). It is clear that Trial Rule 52(B) provides the
trial court with authority to cure any deficiencies in its findings prior to the filing of an
appeal. See Hubbard v. Hubbard, 690 N.E.2d 1219, 1221-22 (Ind. Ct. App. 1998). In the
present case, Husband did not seek redress by raising the issue of incomplete or inadequate
findings in a motion to correct error and requesting that the trial court amend its findings;
thus, Trial Rule 52(B) is inapplicable. See Blakley Corp. v. EFCO Corp., 853 N.E.2d 998,
9
1005 (Ind. Ct. App. 2006). Accordingly, we will adhere to the customary two-tiered
standard of review set forth in Trial Rule 52(A).
In holding Husband in contempt, the trial court concluded that
Husband has been paying credit cards rather than for his Wife’s business
valuation expert. He did so willfully and could have paid the money instead
towards [law]suit expenses or his ill [W]ife’s maintenance. Husband has
willfully acquired an expensive apartment instead of remaining in place
where his rent was much less or instead inhabited a less expensive apartment.
He did this on purpose, instead of paying for the expert or the maintenance.
Husband earns, with social security benefits[,] nearly $7,700.00 per week
and retains in his employ a bookkeeper at $1,000.00 per week who does
nothing more for the business than what Husband can do. He is willfully
rejecting his responsibility to pay for [W]ife’s expert and to pay her
maintenance. By simply letting go of his unnecessary assistant[,] he could[,]
with those savings alone, cover maintenance.
(Appellant’s App. p. 15).
First, Husband contends that the trial court’s finding that he earns “$7,700.00 per
week” is clearly erroneous. (Appellant’s App. p. 15 (emphasis added)). Although we agree
with Husband that this finding is technically inaccurate, we find this error to be immaterial
to the Judgment. In at least three additional findings, as well as a footnote, the trial court
indicates that Husband’s monthly—rather than weekly—income totals $7,687.67.
Moreover, the parties are in agreement that Husband earns a biweekly salary of $2,524.15
and monthly social security benefits of $2,219. Because it is clear that the trial court’s
isolated reference to Husband’s weekly income is an unintended oversight, the error does
not merit reversal.
Husband next contends that the trial court’s finding that he moved into a more
expensive apartment in order to evade his obligations is erroneous. Specifically, the trial
10
court found that “[p]rior to moving into an apartment recently, Husband was living with a
neighbor or his son. At such places[,] he lived either rent-free, or was possibly paying
$300-400 per month, or possibly paid his rent through providing his neighbors cases of
wine.” (Appellant’s App. p. 13). The trial court also found that, by the time of the
contempt hearing, Husband had moved to “an apartment where the rent is $1,450 per
month, utilities are $85 per month . . . [,] and cable internet is $115 per month for a total
cost [of] $1650 per month. This is a lot more than what he had been paying.” (Appellant’s
App. p. 13). On appeal, Husband argues,
At the time of the [contempt] hearing, [he] was living in the same apartment
in which he was living at the time of the [third provisional] hearing when
there was no maintenance order in place. He did not move between the [third
provisional hearing on] June 24, 2013 and the [contempt] hearing on October
25, 2013.
(Appellant’s Br. p. 20).
We first note that Husband’s declaration is unsupported with a citation to the record.
Ind. Appellate Rule 46(A)(8)(a). Also, the transcript of the third provisional hearing is not
before this court to ascertain whether Husband’s living arrangements were discussed at that
time. Furthermore, the trial court’s finding is consistent with the only evidence in the
record. During the contempt hearing, Wife testified that Husband had been living with his
son, and when his neighbors went to Florida, Husband lived in their house for “six months
or seven months.” (Transcript p. 17). She further testified that, in addition to his report
that he sometimes paid $300 or $400 in rent, Husband “supplies the neighbors with [cases
of] wine from his restaurant all year long.” (Tr. p. 18). Conversely, Husband neither
11
challenged Wife’s testimony, nor presented contradictory evidence of his housing
situation. Therefore, we find no error in the trial court’s finding.
Finally, Husband disputes the trial court’s finding that he “could have paid the
maintenance he was required, but has chosen not to do so.” (Appellant’s App. p. 13).
According to Husband,
It is pellucid based on the trial court’s own numbers[] [that] Husband does
not have the ability to pay maintenance in the amount ordered, plus the
[$15,000] ordered [in Provisional Order #2], the monies to [the business
valuation expert] ordered [in Provisional Order #3], or the [$4,000] in fees
ordered to [Wife’s attorney] [in the Judgment].
(Appellant’s Br. p. 21).
Along with the $1,650 budgeted for Husband’s apartment and utilities, the trial court
found that Husband has the following expenses:
a. $192 per month for Wife’s health insurance;
b. $433 per month car payment;
c. $450 per month for groceries and sundries;
d. $25 per month for clothing;
e. $1000 annually for car insurance ($83.33 per month); and
f. $300 annual uninsured medical expenses ($25 per month);
which expenses total $1208.33 per month.
(Appellant’s App. p. 13). Additionally, the trial court found that Husband makes the
following credit card payments: $527 to MasterCard, $333 to First Merchants Bank, $520
to Bank of America, and $500 to American Express, and that “Husband has entered into
[an] installment payment agreement with the IRS of $1000.00 per month.” (Appellant’s
App. p. 14). All told, the trial court’s findings indicate that after paying his expenses of
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$5,738.33, Husband is left with $1,949.34 each month.3 Husband also submitted evidence
regarding the financial state of his companies to demonstrate “that there was no money in
the businesses from which . . . [he] could distribute funds to make the payments ordered.”
(Appellant’s Br. p. 22).
At first glance, Husband’s defense to contempt is sustainable. Notwithstanding the
fact that Husband also owes attorney fees of $63,479.21, his disposable income is clearly
insufficient to cover $3,225 in monthly maintenance, as well as more than $15,000 in
additional fees. Nonetheless, our review is deferential to the trial court’s determinations
of evidentiary value and witness credibility. See MacIntosh v. MacIntosh, 749 N.E.2d 626,
629-31 (Ind. Ct. App. 2001), trans. denied. Here, the findings reflect the trial court’s
skepticism as to Husband’s candor about his finances. At the contempt hearing, Wife
testified that Husband used to bring “brown paper bag[s]” full of cash into the house, but
the sudden cessation of the cash flow coincided with her request for a divorce. (Tr. p. 15).
The trial court
believe[d] that Wife saw bags of cash. How much was in them is speculative.
Wife does not really know anything about her [H]usband’s businesses. . . .
Husband is certainly economically resourceful. . . . Crafty as he is and in
control of all the information about his business, certainly there is a question
about what the business is worth. Wife has no way of knowing. An expert
is needed.
(Appellant’s App. p. 13). The trial court also considered that Husband has been
“recalcitrant in his efforts to slow-play the process” and found that his “nonpayment of
3
Husband’s September 2013 bank statement indicates that he made a $500 payment to American Express,
but he testified during the contempt hearing that the balance of this credit card, which “was in the area of
six to seven thousand dollars[,]” has been paid in full. (Tr. p. 75). Without this payment obligation,
Husband’s monthly surplus is actually $2,449.34.
13
fees to address the basic issue in this divorce—what is the business worth?—has been
inexcusable.” (Appellant’s App. p.12). Acknowledging that “Wife’s dithering with
multiple counsel [has] not helped the case along,” the trial court stated,
[M]ostly the problem is that Husband—who has (1) a lawyer who does not
insist that his bills get paid even though he owes him over $63,000.00[,] (2)
a $52,000.00 bookkeeper who does nothing for the business that Husband
could not do[,] and (3) nearly $7,700 of verifiable monthly income—won’t
cough up the money to allow a professional to do the work necessary to
complete the valuation work.
(Appellant’s App. p. 12). Thus, according to the trial court, Husband has the means to
comply with the Provisional Orders, but he instead opted to pay off credit cards, obtain
more expensive housing, and maintain a bookkeeper on his payroll.
Without forcing Husband to live with his son or to terminate an employee of twenty
years, we uphold the trial court’s finding of contempt. The evidence and findings
demonstrate that Husband has not satisfied his burden of proving a complete inability to
comply. Despite having nearly $2,500 of excess income each month (and potentially
more), nothing in the record evinces a good faith effort by Husband to comply with the
Provisional Orders. By declining to even make partial payments or, at the very least,
contacting the business valuation expert, Husband’s behavior evinces a willful defiance to
the trial court’s authority rather than simply a financial hurdle. See Sutton v. Sutton, 773
N.E.2d 289, 297 (Ind. Ct. App. 2002); Head, 626 N.E.2d at 526. Because the propriety of
the Provisional Orders was only established with the Hogshire I and Hogshire II decisions,
Husband did not have the prerogative to simply disregard the trial court’s mandates.
Accordingly, we find that the trial court’s findings sufficiently support a determination of
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contempt. However, in the interest of consistency, we remand with instructions for the
trial court to revise the amounts of maintenance and other fees, as stated in the Judgment,
in accordance with our holdings in Hogshire I and Hogshire II.4
III. Attorney Fees
Husband also claims that the trial court’s award of attorney fees should be reversed
in light of Hogshire I. Because the finding of contempt was based on Husband’s non-
compliance with an order that has since been overturned on appeal, he asserts that “it is
unfair to . . . require him to pay the [$4,000] in attorney fees” as it serves to “punish[] him
for appealing [Provisional Order #2] when he did not have the money to post a cash bond.”
(Appellant’s Br. p. 28). We disagree.
The fact that the Provisional Orders were reversed on appeal does not negate the
fact that Husband willfully violated their terms while they remained in full force in effect.
“Without regard to economic resources, once a party is found in contempt, the trial court
has ‘the inherent authority to compensate the aggrieved party for losses and damages
resulting from another’s contemptuous actions.’” Adler v. Adler, 713 N.E.2d 348, 355
(Ind. Ct. App. 1999) (quoting Crowl, 678 N.E.2d at 832). Here, Wife incurred more than
$4,000 in attorney fees related to the contempt action; therefore, we find that the trial court
properly exercised its authority to compensate her with an award of attorney fees.
CONCLUSION
4
Husband also contends that the trial court erred in concluding that the escrowed proceeds from the sale of
the marital residence should be used to pay the fees. Although it appears that Husband’s argument relates
to the prejudicial impact of disbursing these funds prior to the final hearing, he does not support his claim
with cogent reasoning or citations to authority, thereby waiving this argument under Indiana Appellate Rule
46(A)(8)(a).
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Based on the foregoing, we conclude that the trial court did not err in holding
Husband in contempt and ordering him to pay Wife’s attorney fees based on his willful
disobedience of the Provisional Orders; however, we remand to the trial court with
instructions to revise the Judgment such that the stated amounts of maintenance and other
fees are consistent with our remand instructions in Hogshire I and Hogshire II.
Affirmed and remanded.
MATHIAS, J. and CRONE, J. concur
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