Preview:

FOR PUBLICATION

ATTORNEYS FOR APPELLANTS: GRANTLAND M. CLAPACS KARL L. MULVANEY Bingham McHale, LLP Indianapolis, Indiana

ATTORNEYS FOR APPELLEE: MARK R. GALLIHER JOANNE B. FRIEDMEYER Doyle & Friedmeyer Indianapolis, Indiana

IN THE COURT OF APPEALS OF INDIANA
KENNETH H. CLARKSON and ANDREA G. CLARKSON, Appellants, vs. MICHAEL NEFF, Appellee. ) ) ) ) ) ) ) ) ) )

No. 49A02-0705-CV-441

APPEAL FROM THE MARION SUPERIOR COURT The Honorable John F. Hanley, Judge Cause No. 49D11-0307-CC-1348

December 12, 2007 OPINION - FOR PUBLICATION BARNES, Judge

Case Summary Kenneth and Andrea Clarkson appeal the trial court's grant of summary judgment in favor of Michael Neff. We reverse and remand. Issue The sole issue we address is whether Neff had constructive notice of a pending lawsuit brought by the Clarksons that concerned real estate Neff purchased. Facts In May 2002, the Clarksons entered into a contract with Summit Custom Homes, Inc., ("Summit") to construct a home for the Clarksons in Hancock County. Summit allegedly took longer to construct the home than originally promised. By May 2003, it was ready to close on the sale of the home to the Clarksons. However, according to the Clarksons, Summit failed to construct the home as required by the contract and also sought to charge more for the home than provided by the contract. The Clarksons refused to close on the home. After attempting to negotiate a settlement to their dispute, on July 29, 2003, the Clarksons filed suit against Summit, seeking damages and also seeking specific performance of the contract. This lawsuit was filed in the Marion County Superior Court ("the Superior Court lawsuit"). On August 5, 2003, the Clarksons filed a lis pendens notice of the Superior Court lawsuit with the Hancock County Recorder. On March 23, 2004, the Marion Superior Court dismissed the Superior Court lawsuit on its own motion, apparently for alleged failure to prosecute. Neither the

2

Clarksons nor Summit were aware of the dismissal, and they continued discovery and settlement negotiations. On November 16, 2005, Summit filed an emergency motion to enforce a partial settlement agreement allegedly reached between it and the Clarksons. The Marion

Superior Court denied the motion on the basis that the case had been dismissed. Upon learning of the dismissal, on November 17, 2005, the Clarksons filed a new complaint against Summit in the Marion County Circuit Court ("the Circuit Court lawsuit"). The complaint for the Circuit Court lawsuit was a word-by-word replica of the complaint filed in the Superior Court lawsuit. On that same date, the Clarksons filed lis pendens notices of the Circuit Court lawsuit with both the Marion and Hancock County Circuit Court Clerks. On November 18, 2005, the Clarksons filed a motion to reinstate the Superior Court lawsuit. On November 30, 2005, Neff purchased the home from Summit. On December 12, 2005, the Clarksons's Superior Court lawsuit was reinstated without opposition from Summit. On May 22, 2006, the Clarksons filed a motion for leave to add Neff as a defendant in the Superior Court lawsuit. Summit objected to this motion, but on October 5, 2006, the Marion Superior Court allowed the Clarksons to file a supplemental complaint naming Neff as a defendant. Afterwards, Neff filed a crossclaim against Summit based on its issuance of a warranty deed when Neff bought the home. On February 1, 2007, the Clarksons filed a motion to consolidate the Superior Court and Circuit Court lawsuits. On February 23, 2007, Neff filed a motion for

summary judgment against the Clarksons in the Superior Court lawsuit. On February 27, 3

2007, the Superior Court consolidated the two lawsuits. On April 30, 2007, the Superior Court granted summary judgment in favor of Neff, concluding that he owned the house free and clear of any purported interest of the Clarksons. After the summary judgment order was certified as final and appealable, the Clarksons initiated this appeal. Analysis We review the propriety of granting summary judgment by using the same standard applied by the trial court. Beineke v. Chemical Waste Mgmt. of Indiana, LLC, 868 N.E.2d 534, 537 (Ind. Ct. App. 2007). Summary judgment is appropriate "if the designated evidentiary matter shows that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Ind. Trial Rule 56(C); Beineke, 868 N.E.2d at 537. "During our review, all facts and reasonable

inferences drawn from them are construed in favor of the nonmoving party." Beineke, 868 N.E.2d at 537. A grant of summary judgment may be affirmed on any theory or basis in the record. Id. At common law, the doctrine of lis pendens provided that a person who acquired an interest in land during the pendency of an action concerning the title thereof took the property subject to any judgment later rendered in the action. See Mid-West Fed. Sav. Bank v. Kerlin, 672 N.E.2d 82, 86 (Ind. Ct. App. 1996) (citing Wilson v. Hefflin, 81 Ind. 35, 41-42 (1881)). Commencement of the action itself was deemed to provide notice to the purchaser of the land. See id. In the latter part of the nineteenth century, the legislature enacted lis pendens statutes that modified the common law rule. Briefly stated, the statutes require that a 4

separate written notice of a pending suit be filed with the clerk of the circuit court of the county where the land is located in order for the action to affect the interests of any persons acquiring an interest in the land while the action was pending. See id. It has been stated: The purpose of lis pendens notice is to provide machinery whereby a person with an in rem claim to property which is not otherwise recorded or perfected may put his claim upon the public records, so that third persons dealing with the defendant . . . will have constructive notice of it. Curry v. Orwig, 429 N.E.2d 268, 272-73 (Ind. Ct. App. 1981) (quoting 4 W. Harvey and R. B. Townsend, Indiana Practice

Download Kenneth H. Clarkson and Andrea G. Clarkson v. Michael Neff.pdf

Indiana Law