J.B. Hunt Transport, Inc., and Terry L. Brown, Jr. v. The Guardianship of Kristen Zak (mem. dec.)

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be
regarded as precedent or cited before any
court except for the purpose of establishing FILED
the defense of res judicata, collateral Jul 18 2018, 9:07 am
estoppel, or the law of the case. CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court
ATTORNEYS FOR APPELLANTS ATTORNEYS FOR APPELLEE
Bruce D. Jones Timothy S. Schafer
Keith A. Gaston Timothy S. Schafer II
Cruser Mitchell Novitz Sanchez Gaston Todd S. Schafer
& Zimet, LP Schafer & Schafer, LLP
Indianapolis, Indiana Merrillville, Indiana
Gregory W. Brown
Brown & Brown, P.C.
Merrillville, Indiana
IN THE
COURT OF APPEALS OF INDIANA
J.B. Hunt Transport, Inc., and July 18, 2018
Terry L. Brown, Jr., Court of Appeals Case No.
Appellants-Defendants, 45A03-1710-CT-2429
Appeal from the Lake Superior
v. Court
The Honorable Diane Kavadias
The Guardianship of Kristen Schneider, Judge
Zak, Trial Court Cause No.
Appellee-Plaintiff. 45D11-0610-CT-190
Friedlander, Senior Judge.
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[1] J.B. Hunt Transport, Inc. and Terry L. Brown, Jr. (collectively, “the
Appellants”) appeal the trial court’s order awarding the Guardianship of
Kristen Zak (“the Guardianship”) $4,810,000 in prejudgment interest. We
affirm.
[2] On January 17, 2006, Zak was seriously injured when the car in which she was
a passenger struck a semi tractor-trailer that had been wrecked approximately
one hour earlier by Brown, a driver employed by Hunt. J.B. Hunt Transp., Inc. v.
Guardianship of Zak, 58 N.E.3d 956 (Ind. Ct. App. 2016), trans. denied. On
October 26, 2006, the Guardianship filed a complaint against the Appellants,
alleging that they were negligent and that their negligence caused Zak’s injuries.
Id. The matter proceeded to a jury trial, after which the jury returned a verdict
in favor of the Guardianship and awarded the Guardianship $32,500,000 in
1
damages. Id. We subsequently affirmed the jury’s verdict. Id. The matter
returned to the trial court, after which the trial court awarded the Guardianship
$4,810,000 in prejudgment interest.
[3] On appeal, the Appellants contend that the trial court abused its discretion in
awarding the Guardianship prejudgment interest. Specifically, the Appellants
argue that the trial court abused its discretion because (1) the Guardianship
failed to satisfy the requirements of the Tort Prejudgment Interest Statute
1
Approximately $19,500,000 of the award was allocated to the Appellants.
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(“TPIS”) and (2) the Guardianship’s request for prejudgment interest was
untimely.
[4] Prejudgment interest represents an element of complete compensation. Johnson
v. Eldridge, 799 N.E.2d 29 (Ind. Ct. App. 2003), trans. denied. As such, it “is not
simply an award of interest on a judgment, but rather is recoverable as
additional damages to accomplish full compensation.” Id. at 32 (internal
quotation omitted). The TPIS “permits a trial court to award prejudgment
interest to the party that prevails at trial, so long as that party has made a timely
offer of settlement according to terms specified in the statute.” Id.We evaluate the award of prejudgment interest under an abuse of
discretion standard. The decision to award prejudgment interest
rests on a factual determination, and this court may only consider
the evidence most favorable to the judgment. An abuse of
discretion occurs when the trial court’s decision is clearly against
the logic and effect of the facts and circumstances before the
court, or if the court has misinterpreted the law.
Id. at 33 (internal citations omitted).
[5] The TPIS provides that a party is not entitled to prejudgment interest if:
(1) within one (1) year after a claim is filed in the court, or any
longer period determined by the court to be necessary upon a showing of
good cause, the party who filed the claim fails to make a written
offer of settlement to the party or parties against whom the claim
is filed;
(2) the terms of the offer fail to provide for payment of the
settlement offer within sixty (60) days after the offer is accepted;
or
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(3) the amount of the offer exceeds one and one-third (1⅓) of the
amount of the judgment awarded.
Ind. Code § 34-51-4-6 (1998) (emphasis added). “If the court awards
prejudgment interest, the court shall determine the period during which
prejudgment interest accrues. However, the period may not exceed forty-eight
(48) months.” Ind. Code § 34-51-4-8(a) (1998). Prejudgment interest begins to
accrue on the latest of either (1) fifteen months after the cause of action accrued
or (2) six months after the claim is filed in the court. Id.
1. Whether the Guardianship Satisfied the Requirements
of the TPIS
[6] The Appellants argue that the trial court abused its discretion in awarding
prejudgment interest to the Guardianship because the Guardianship failed to
satisfy the requirements of the TPIS.
A. Settlement Offer
[7] The Appellants claim that the Guardianship should not have been awarded
prejudgment interest because it failed to establish that there was good cause for
its failure to make a settlement offer within one year of initiating suit. The
record reveals that the Guardianship’s delay can, at least in part, be attributed
to the actions of the Appellants. The Appellants withheld certain critical
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2
documents relating to the Appellants’ fault during the discovery phase. In fact,
the Appellants did not provide the Guardianship with some of these critical
documents until being ordered to do so by the trial court. Prior to receiving
these documents, the Guardianship lacked the ability to accurately assess the
3
merits of its case. The record further reveals that the Guardianship made a
settlement offer six days after receiving the last of the critical documents. The
trial court, being in the best position to gauge the importance of the critical
documents to the case, found that the Guardianship made its settlement offer
within a reasonable time after receiving the last of the documents. The Indiana
Supreme Court has held:
[t]he TPIS is not intended to serve as a trap for the unwary. It is
designed to put the adverse party on notice of a claim and
provide them with an opportunity to engage in meaningful
settlement and if they do not do so, they run the risk of incurring
the additional obligation of prejudgment interest.
Wisner v. Laney, 984 N.E.2d 1201, 1212 (Ind. 2012). The trial court acted
within its discretion in determining that the Guardianship established that there
was good cause for its delay in tendering its settlement offer.
2
These documents included the Safety Event Review completed in connection to the initial accident, J.B.
Hunt’s Driver’s Manual which outlined the steps that should have been taken if a driver was involved in an
accident, the accident kit prepared in connection to the accident, and three event logs relating to the accident.
3
This seems especially true given that both Zak and the driver of the vehicle in which she was a passenger
suffered significant head injuries in the crash and neither has any memory of the crash.
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B. The Sixty-Day Settlement Requirement
[8] The Appellants also claim that the Guardianship “violated the TPIS by failing
4
to allow [them] 60 days to pay the demand.” Appellants’ Br. p. 17. In Cahoon
v. Cummings, 734 N.E.2d 535, 547 (Ind. 2000), the Indiana Supreme Court held
that “[t]he whole point of [Indiana Code section 34-51-4-6] is to address the
cost of delay in payment” and “an offer to settle ‘now’ is an offer to settle by
payment within sixty days.” In Wisner, the Indiana Supreme Court held that an
“offer to solve this matter at this time” was sufficient to satisfy Indiana Code
section 34-51-4-6 as “[t]he key is to include the time-limiting language in the
offer.” 984 N.E.2d at 1211. The settlement offer at issue in this case was sent
to the Appellants on January 25, 2011. It indicated that the offer would “stay
open only until the pre-trial conference set for February 3, 2011.” Appellants’
App. Vol. 3, p. 138. Consistent with the Indiana Supreme Court’s decisions in
Cahoon and Wisner, we conclude that because the settlement offer included
time-limiting language, the trial court acted within its discretion in determining
that the offer satisfied Indiana Code section 34-51-4-6.
4
We note that while the Appellants seem to argue that the statute indicates that the Guardianship should
have granted them at least sixty days to accept and satisfy the tendered settlement offer, Indiana Code section
34-51-4-6 actually provides that the tendered settlement offer must make it clear that such acceptance and
payment must be made within sixty days.
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2. Whether the Guardianship’s Request for Prejudgment
Interest was Untimely
[9] The Appellants also argue that trial court abused its discretion in awarding
prejudgment interest because the Guardianship failed to make a timely request.
In support, the Appellants cite to case law from jurisdictions outside Indiana
and point to the fact that the Guardianship did not make a request for
prejudgment interest until ten months after the final judgment was entered. The
Appellants’ reliance on the opinions of courts from jurisdictions other than
Indiana is misplaced, however, as these opinions are not binding upon this
court. Further, the Indiana Supreme Court has held that “the comprehensive
nature of the TPIS” clearly indicates “that the legislature intended the statute to
be the exclusive source governing the award of prejudgment interest in cases
falling within its ambit” and, as a result, the TPIS “abrogates and supplants”
the common law prejudgment interest rules. Kosarko v. Padula, 979 N.E.2d 144,
149, 147-48 (Ind. 2012). While the TPIS sets forth the requirements to ensure
that a party qualifies for prejudgment interest, it does not contain the
requirement that a request for prejudgment interest be filed prior to judgment
being entered.
[10] Further, even though a delay of ten months before making the request for
prejudgment interest might be unreasonable in some cases, it does not seem
unreasonable in this case. Review of the record indicates that the Appellants
were not harmed as result of the Guardianship’s delay. Although the trial court
had entered its judgment, the litigation was ongoing as the Appellants appealed
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the jury’s verdict and the trial court made it clear that it would not rule on any
additional motions or requests filed by the parties until after the Appellants’
appeal was resolved. As such, given that the relevant statutory authority does
not provide a time limit for filing a request for prejudgment interest together
with the facts and circumstances of this case, we cannot say that the trial court
abused its discretion in awarding prejudgment interest to the Guardianship.
[11] Judgment affirmed.
Pyle, J., and Barnes, Sr. J., concur.
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