Preview:

FOR PUBLICATION

ATTORNEY FOR APPELLANT: KENT HULL Indiana Legal Services, Inc. South Bend, Indiana

ATTORNEY FOR APPELLEE: RANDY J. SPITAELS Kindig & Sloat, PC Nappanee, Indiana

FILED
of the supreme court, court of appeals and tax court

Dec 19 2008, 9:42 am

IN THE COURT OF APPEALS OF INDIANA
JACKIE FORTNER, Appellant-Defendant, vs. FARM VALLEY-APPLEWOOD APARTMENTS, Appellee-Plaintiff. ) ) ) ) ) ) ) ) ) )

CLERK

No. 20A03-0806-CV-314

APPEAL FROM THE ELKHART SUPERIOR COURT The Honorable Olga H. Stickel, Judge The Honorable Thomas A. Murto, Magistrate Cause No. 20D01-0806-CV-314

December 19, 2008 OPINION - FOR PUBLICATION

BAKER, Chief Judge

Appellant-defendant Jackie Fortner appeals the judgment of eviction and damage award entered in favor of appellee-plaintiff Farm Valley-Applewood Apartments (Farm Valley). Specifically, Fortner argues that the notice of eviction she received from Farm Valley was inadequate and Farm Valley's failure to follow certain grievance procedures violated her right to procedural due process. Moreover, Fortner contends that the evidence presented at trial did not support the judgment of eviction and damage award. Farm Valley cross-appeals, claiming that the trial court improperly limited the amount of attorney's fees to which it was entitled. We conclude that the eviction order and damage award were supported by the evidence. However, we also find that the trial court erred in determining the amount of attorney's fees that Fortner was obligated to pay to Farm Valley. Thus, we affirm in part, reverse in part, and remand this cause with instructions that the trial court conduct a hearing to determine the reasonableness of the fees and award such fees in an amount not to exceed $3,335.04. FACTS Farm Valley entered into a contract with the United States Department of Agriculture Rural Development Administration (RDA), which obligated Farm Valley, in exchange for receiving funds from RDA, to provide housing to qualified low-income tenants. On March 1, 2002, Fortner signed a lease with Farm Valley to rent an apartment in Nappanee. Fortner placed her initials next to the following provisions of the lease:

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I agree I must immediately notify the Landlord when there is a change in my gross income or adjustment to income. I understand my rent or benefits may be affected as a result of this information. I also understand that failure to report such changes may result in my losing benefits to which I may be entitled or may result in the Landlord taking corrective action if benefits are mistakenly received. I understand the corrective action the Landlord may take includes the initiation of a demand for repayment of benefits or rental subsidies improperly received . . . or initiation of a notice of termination. ... I understand that should I receive occupancy benefits to which I am not entitled due to my/our failure to provide information or due to incorrect information provided by me or in my behalf by others, or for any household member, I may be required to make restitution and I agree to repay any amount of benefits to which I was not entitled. Appellant's App. p. 63-64, 243-44. Another paragraph in the lease stated that "the providing of false information upon the Application or in or as part of this Lease" constitutes a default. Id. at 72-73, 239. The lease also provided for the recovery of attorney's fees and costs of collection by Farm Valley if it prevailed "on any action to enforce the provisions of [the] lease, including, without limitation, the payment of . . . rent or other charges when due." Id. at 239. On April 21, 2006, Kimberly Higgins, the property manager for Farm Valley, prepared and served Fortner with a Notice to Vacate (Notice) the premises. The Notice requested that Fortner vacate her apartment by May 21, 2006, because of her "failure to [r]eport total income" and "providing false/forged information." Id. at 74, 251. Fortner appeared pro se at the immediate possession hearing, which was held on June 1, 2006. At that time, Fortner agreed to surrender possession of the apartment.

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Thereafter, when Fortner refused to vacate the premises, Farm Valley brought a small claims action to evict Fortner and collect back rent. The complaint requested judgment in the amount of $3269.96, which represented the amount that Fortner owed for unpaid rent and damages to the apartment. Fortner then retained legal counsel and answered Farm Valley's complaint, asserting setoffs and affirmative defenses. Prior to trial, Farm Valley requested an award "of reasonable attorney fees" in addition to damages. Id. at 202. At the trial, which commenced on April 10, 2007, Farm Valley made an additional request for attorney's fees. Fortner agreed that Farm Valley's counsel would submit an affidavit after the trial setting forth the amount of requested attorney fees. Fortner also reserved the right to object to the amount of attorney's fees that Farm Valley claimed. On May 15, 2007, Farm Valley filed its attorney fee affidavit along with its closing argument. Farm Valley's counsel averred that a reasonable award of attorney fees and expenses in the case was $4,269.60. Although Fortner obtained an extension of time to file her closing argument and the trial court did not enter judgment on Farm Valley's complaint for six months after the trial was held, she did not object to the requested attorney's fees. On October 17, 2007, the trial court entered judgment for Farm Valley as follows: 3. Fortner was required under the terms of the lease and applicable law to submit various proofs of her income and financial situation from time to time. As part of this requirement, the magistrate finds that in 2005 the defendant submitted Plaintiff's Exhibit 3 to the plaintiff, which is found to be a forged document purporting to show that she was attempting to pursue child support but was not currently successful in that effort, when in fact the defendant was receiving child support during the relevant time period. The submission of the 4

forged document resulted in a lower contribution amount toward her monthly rent. 4. The plaintiff later discovered the forged nature of Exhibit 3, and determined there were other inaccuracies in the calculation of the defendant's contribution amount toward her monthly rent. . . . The notice to vacate and the content of the small claim filing each appear to comply with federal and state requirements for notice of the nature of the allegations against the defendant, and other details such as time periods and opportunity to respond. The defendant vacated the premises by June 1, 2006. 5. In this situation of the allegation of use of a forged document by the defendant as a basis for calculation of her contribution amount toward the rent, a grievance process does not apply. 6. In addition to a calculation of additional sums of rent due, the evidence supports recovery for a minor amount of physical damage to lights and screens in the sum of $119.96. Based on calculations with true and accurate data, additional payment toward rent is due from the defendant in the sum of $2,950.00. There is credit for the security deposit in the sum of $380.00. Damages are therefore proven in the sum of $2664.96. 7. The plaintiff is entitled to recover reasonable attorney fees under the terms of the lease. The plaintiff's submissions would support a recovery of attorney fees in excess of $4,500.00. As a matter of due process, and the resulting policy of this Court, since the plaintiff has filed its claim for judgment of $4,000.00, the Court will not award judgment in excess of the claim. The Court enters judgment for the plaintiff in the sum of $4,000.00, plus costs. Appellant's App. p. 7-8. Fortner now appeals. DISCUSSION AND DECISION I. Adequacy of Notice and Grievance Procedures Fortner contends that the judgment must be set aside because the "lease and contractual terms which Farm Valley seeks to enforce against [her] are illegal." Appellant's Br. p. 2. More specifically, Fortner maintains that she was not afforded a grievance 5

procedure pursuant to 7 C.F.R.

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