Christian Business Phone Book, Inc. v. Indianapolis Jewish Community Relations Council

576 N.E.2d 1276 (1991)

The CHRISTIAN Business PHONE BOOK, Inc., Appellant-Plaintiff,
v.
INDIANAPOLIS JEWISH COMMUNITY RELATIONS COUNCIL, Indianapolis Jewish Welfare Federation, Jewish Federation of Greater Indianapolis, Inc., Marcia Goldstone and Naomi Tropp, Appellees-Defendants.

No. 49A05-9101-CV-7.

Court of Appeals of Indiana, Fifth District.

August 19, 1991.

Robert L. Trierweiler, Indianapolis, for appellant-plaintiff.

Daniel D. Trachtman, Mark B. Gramelspacher, Wooden, McLaughlin & Sterner, Indianapolis, for appellees-defendants.

SHARPNACK, Judge.

Plaintiff The Christian Business Phone Book, Inc. (hereinafter "the corporation") appeals the trial court's dismissal of its cause of action against defendants Indianapolis Jewish Community Relations Council, Indianapolis Jewish Welfare Federation, Jewish Federation of Greater Indianapolis, Inc., Marcia Goldstone, and Naomi Tropp (hereinafter collectively "the council"). We reverse.

The single issue raised by the corporation we restate as follows:

Did the trial court err in dismissing the corporation's cause of action where the corporation was represented by an attorney when the court heard the motion to dismiss although it was not represented by an attorney when it filed its complaint?

The relevant facts before the trial court and this court are largely procedural. On May 16, 1990, the corporation filed a four count complaint against the council. This complaint was signed by David M. Narmore, the president of the corporation. It was not signed by an attorney, and no attorney appeared for the corporation at the time it filed the complaint. On July 9, 1990, the attorneys for the council filed an answer and a motion to dismiss. The motion to dismiss was based on the failure of the corporation to appear by attorney as required by IND. CODE § 34-1-60-1.

The court set the matter for hearing on September 10, 1990. On the tenth, attorney Robert L. Trierweiler filed his appearance for the corporation. The court held the hearing on the motion to dismiss on the same day. The court took the matter under advisement, and, on the next day, it granted the motion to dismiss. On October 4, two additional attorneys filed appearances and a motion to set aside the dismissal on behalf of the corporation, which motions the trial court denied.

It is clear that, except in certain small claims cases where the claimed damages amount to $750.00 or less, a corporation must be represented by an attorney in order to prosecute or defend a lawsuit. I.C. § 34-1-60-1; see, State ex rel. Western Parks, Inc. v. Bartholomew County Court (1978), 270 Ind. 41, 383 N.E.2d 290; Rollins Protective Services Co. v. Wright (1986), Ind. App., 493 N.E.2d 811; Sears, Roebuck & Co. v. Roque (1980), Ind. App., 414 N.E.2d 317; and see IND.RULES OF PROCEDURE, SMALL CLAIMS RULE 8(C). The council argues that, because corporations must be represented by attorneys in all litigation except the small claims cases noted above, and 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 in the case prior to the hearing on the dismissal.

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." Fulton v. Van Slyke (1983), Ind. App., 447 N.E.2d 628, 634-635. In numerous cases, our appellate courts have held that dismissal should not be granted unless less drastic sanctions will not suffice. See, Fulton, 447 N.E.2d at 635-637 (citing numerous Indiana and federal decisions); Breedlove v. Breedlove (1981), Ind. App., 421 N.E.2d 739, 741.

In Western Parks, the case upon which the council places its greatest reliance, the supreme court did not order the cause of action to be dismissed. Instead, the court issued a writ which prohibited the county court from further exercising jurisdiction in the matter until counsel appeared for the plaintiff corporation.

In addition, the federal cases which the council cites in support of its position actually support the position that a corporation should be given, and refuse, the opportunity to obtain counsel before its cause of action may be dismissed. In Palazzo v. Gulf Oil Corp. (11th Cir.1985), 764 F.2d 1381, the trial court, after repeatedly warning a corporate plaintiff to obtain representation by a licensed attorney, dismissed its cause of action for failure to obtain proper representation. In affirming the dismissal, a panel of the eleventh circuit noted:

Nor is any injustice done to plaintiff by this holding. The record is clear that the court below was more than accommodating in urging proper representation of the corporate claims. When original counsel for the plaintiffs withdrew, the court ordered plaintiffs to secure substitute counsel in 30 days. Despite plaintiffs' failure in this regard, the U.S. Magistrate, over 10 months later, in March of 1982, allowed the corporation another 10 days to obtain counsel for response to defendant's motion for summary judgment. Plaintiffs having been fully advised of the need for proper representation of the corporate claims, we agree with the lower court's dismissal of these claims for lack of proper representation.

764 F.2d at 1389 (emphasis added).

Similarly, the court in Jones v. Niagara Frontier Transportation Authority (2nd Cir.1983), 722 F.2d 20, affirmed the trial court which had entered an order dismissing an action by a corporate litigant unless the corporation obtained proper representation within forty-five days. The trial court in Strong Delivery Ministry Association v. Board of Appeals (7th Cir.1976), 543 F.2d 32, also dismissed a corporate cause of action for failure to obtain representation by an attorney, and the court of appeals affirmed the dismissal. In Strong as in Jones, however, the trial court had given the corporation the opportunity, which the corporation refused, to retain proper representation before dismissing the action. Obviously the trial and appellate courts in these cases recognized that the corporate litigant must be given a fair opportunity to correct its error and retain competent counsel before dismissal would be appropriate. We believe that this principle accords with our general rule disfavoring dismissals, and with the supreme court's specific actions in the Western Parks case, and, consequently, we hold the trial court here erred in dismissing the corporate cause of action after an attorney had appeared for the corporation.

We reverse and remand to the trial court with instructions to reinstate the plaintiff's cause of action.

REVERSED AND REMANDED WITH INSTRUCTIONS.

CHEZEM and BARTEAU, JJ., concur.