Boehne v. Camelot Village Apartments

• Decision Date: 09 November 1972
• Docket Number: No. 472A173,472A173
• Citation: 33 Ind.Dec. 424,154 Ind.App. 21,288 N.E.2d 771
• Parties: Lucy BOEHNE, On Behalf of Herself and All Other Former Lessees of the Defendant Similarly Situated, Plaintiff-Appellant, v. CAMELOT VILLAGE APARTMENTS, an assumed business name used by Camelot Village, Inc., Defendant-Appellee.
• Court: Indiana Appellate Court

Page 771

288 N.E.2d 771

154 Ind.App. 21

Lucy BOEHNE, On Behalf of Herself and All Other Former

Lessees of the Defendant Similarly Situated, Plaintiff-Appellant, v. CAMELOT VILLAGE APARTMENTS, an assumed business name used by

Camelot Village, Inc., Defendant-Appellee.

No. 472A173.

Court of Appeals of Indiana, First District.

Nov. 9, 1972.

Rehearing Denied Dec. 12, 1972.

Ronald Warrum, Evansville, for plaintiff-appellant.

John Coates Cox, Evansville, for defendant-appellee.

LOWDERMILK, Judge.

This action was brought by plaintiff-appellant on behalf of herself and all other former lessees of the defendant-appellee similarly situated. Plaintiff-appellant will be hereinafter referred to as 'Tenant.' Defendant-appellee operated as Camelot Village Apartments, which was an assumed business name used by Camelot Village, Inc., and shall be hereinafter referred to as the 'Landlord.'

The Tenant brought a class action to recover security deposits which it is alleged were wrongfully retained by the Landlord and to recover punitive damages for wrongful acts of the Landlord and for fraud and deliberate and willful breach of the lease agreements.

Tenants, when entering into a written contract with the Landlord, paid the Landlord a basic security deposit of $100.00 and some deposits were $25.00 additional as a security deposit for each pet. Under the terms of the agreement the security deposit was to be returned to each of the tenants at the satisfactory termination of the lease. Tenant alleges that upon satisfactory termination of the lease, the security deposits were not so returned because of Landlord's fraud, or the willful or negligence breach of the lease agreement by the Landlord.

The complaint was first filed in one legal Paragraph to which the Landlord filed a Rule 12, IC 1971, 34--5--1--1, motion which was sustained.

This was followed by an amended complaint to which Landlord filed a Rule 12 motion in three Paragraphs.

In due time and after oral argument plaintiff was granted ten days in which to file an amended complaint and a second amended complaint was filed in three Paragraphs.

Said second amended complaint alleges in legal Paragraph I:

1. That plaintiff and the class on behalf of whom she acts had entered into a written lease agreement with the Landlord for private single family residences and dwellings within the defendant's apartment complex, which agreements all contain the following language:

'SECURITY DEPOSIT. The sum of $_ _ is hereby paid by the Lessee as security and not as a rental payment, final or otherwise for the full and faithful performance of all the terms and conditions of this Lease and which sum shall be returned to the Lessee at the satisfactory termination of this Lease.'

2. Appellant-Tenant Boehne paid $100.00 as a basic security deposit and $25.00 additional deposit for a pet which she maintained in her unit; the class on behalf of whom she acts paid $100.00 as a basic security deposit and $25.00 as an additional security depsoit for each pet maintained in the leased premises of the Landlord.

3. The Landlord willfully refused to return Tenant Boehne's security deposit in September of 1971 upon the satisfactory termination of the lease and has refused to return security deposits of the class on behalf of whom the named plaintiff acts upon the satisfactory termination of each of said leases.

4. Tenant Boehne brings the action as a class action because:

(a) The great number of others on behalf of whom she acts, who were wrongfully refused their security deposits by the defendant upon the satisfactory termination of the lease constitute a class so numerous that the joinder of all its members is impracticable.

(b) There are questions of law and fact common to the class.

(c) The claims or defenses of Lucy Boehne are typical of the claims or defenses of the class.

(d) Lucy Boehne will fairly and adequately protect the interests of the class.

(e) The prosecution of separate actions by individual members of the class would create a risk of inconsistent or varying adjudications which would establish incompatible standards of conduct for the party opposing the class.

(f) The defendant who opposes the class has refused to act on grounds generally applicable to the class.

(g) The questions of law or fact common to the members of the class predominate over any questions affecting individual members, and a class action is superior to all other available methods for the fair and efficient adjudication of the controversy.

5. The defendant defrauded Tenant Boehne and the class on behalf of whom she acts in that at the time the defendant Landlord accepted such security deposit of the class under the aforesaid conditions of the written agreement, the defendant had a policy and practice of wrongfully retaining said security deposits without cause upon the satisfactory termination of the lease.

Legal Paragraphs II and III incorporated by reference and made a part of each Paragraph rhetorical paragraphs 1, 2, 3, and 4 of pleading Paragraph I.

Legal Paragraph II further alleged defendant Landlord willfully breached the aforementioned provisions of the contract of Tenant Boehne and the class on behalf of whom she sues.

Legal Paragraph III alleged defendant Landlord negligently breached the provisions in the contracts of Tenant Boehne and the class on behalf of whom she sues.

The first legal Paragraph ask that an amount equal to the security deposits wrongfully retained by the defendant be awarded plaintiff-Tenant, plus $50,000 as punitive damages for the fraud perpetrated upon plaintiff-Tenant and the class for which she acts, plus attorney's fees and costs.

The prayer of the second legal Paragraph prays for the same amounts for willful breach of the contract by the defendant and the prayer to legal Paragraph III is for relief in an amount equal to the security deposits wrongfully retained by the defendant, plus costs of the action.

The trial court, in his ruling, sustained specifications 1, 2, and 3 of defendant's Rule 12 motions and overruled specifications 4, 5, and 6 thereof.

Tenant Boehne refused to plead further and the court entered judgment dismissing Paragraphs I, II, and III of the second amended complaint, and that Boehne take nothing thereunder.

The motion to correct errors does not mention legal Paragraphs IV, V, and VI and they are, therefore, waived and we shall not discuss them herein.

The motion to correct errors sets forth that the trial court erred as follows:

Uncorrected error of law occurring, and properly raised in the proceedings, prior to the trial of this cause, in this:

(1) That the court erred in sustaining the motion to dismiss and in the dismissing of Paragraphs I, II, and III of plaintiff's complaint.

The claimed errors were all substantially the same and in the interest of brevity are grouped and treated as one in this opinion.

Tenant complains that at no time during the proceedings did the trial court determine whether the class action was to be so maintained as is contemplated by Rule TR. 23(C)(1), which Rule is as follows, to-wit:

'(C) Determination by order whether class action to be maintained--Notice--Judgment--Actions conducted partially as class actions.

'(1) As soon as practicable after the commencement of an action brought as a class action, the court, upon hearing or waiver of hearing, shall determine by order whether it is to be so maintained. An order under this subdivision may be conditional, and may be altered or amended before the decision on the merits.'

Counsel set forth in their briefs that, as to the matter of class actions we are now at sea without instruments to guide us in the field of class actions in Indiana.

It is true that the adoption of our new Supreme Court Rules which became effective January 1, 1970, has created a chasm between our Supreme Court's interpretation of class actions under Ind.Stat.Ann. § 2--220 (Burns 1967 Replacement), and the present Rule TR. 23, entitled 'Class Actions.'

Under the old Rule, the Landlord cited and relied on the case of Kimes v. Gary (1946), 224 Ind. 294, 66 N.E.2d 888. In Kimes the court held that one or more persons may sue or defend for the benefit of a whole class "when the question is one of a common or general interest of many persons, or where the parties are numerous and it is impracticable to bring them all before the court.' § 2--220, Burns' 1933.' The Court further held that where a class action is properly brought all the persons represented in the class are bound by the judgment. The court, discussing this further, said:

'. . . It follows that class actions should be closely scrutinized and should be permitted only in clear cases. Unless the named plaintiffs and all members of the class have an actual common interest in the subject matter of the action and the facts are such that the interests of the absent members of the class will be fairly and fully represented and protected there will be a failure of due process and the class action will not be proper. . . .'

The court further said that our Indiana cases hold that in order to prosecute a class action there must be a joint cause of action of all members of the class. (Our emphasis.)

Landlord also cites the case of Wolf v. Bennett (1948), 118 Ind.App. 567, 82 N.E.2d 262. There, the court said:

'. . . The evidence in this case shows nothing more than the separate and distinct ownership of ten oil leases operated by a common broker under individual contracts with the owners of each lease and the failure of such broker to keep the accounts of each operation properly segregated. This is far from the community of interest contemplated by the principles of equity and the provisions of our statute authorizing class suits. . . .'

This court further held that the rights of those members of the alleged class who hold leases in Kentucky are governed by the laws of that state while the interests of other members are...