Bowyer Excavating, Inc. v. Commissioner, Indiana Dept. of Environmental Management

• Decision Date: 15 October 1996
• Docket Number: No. 85A05-9511-CV-436,85A05-9511-CV-436
• Citation: 671 N.E.2d 180
• Parties: BOWYER EXCAVATING, INC., In the Matter of the Petition to Intervene of Bowyer Excavating, Inc., Appellant, v. COMMISSIONER, INDIANA DEPARTMENT OF ENVIRONMENTAL MANAGEMENT, RLG, Inc., Lawrence Roseman d/b/a Spring Valley Landfill and Lawrence Roseman, Wabash County, Indiana; Constance J. King; Commissioner of Indiana Department Of Environmental Management, Appellees.
• Court: Indiana Appellate Court

Page 180

671 N.E.2d 180

BOWYER EXCAVATING, INC., In the Matter of the Petition to Intervene of Bowyer Excavating, Inc., Appellant, v. COMMISSIONER, INDIANA DEPARTMENT OF ENVIRONMENTAL MANAGEMENT, RLG, Inc., Lawrence Roseman d/b/a Spring Valley Landfill and Lawrence Roseman, Wabash County, Indiana Constance J. King; Commissioner of Indiana Department Of Environmental Management, Appellees.

No. 85A05-9511-CV-436.

Court of Appeals of Indiana.

Oct. 15, 1996.

Donald J. Tribbett, Starr Austen Tribbett & Myers, Logansport, for Appellant.

Pamela Carter, Attorney General, Anita W. Kimmel, Deputy Attorney General, Indianapolis, for Appellee IDEM.

OPINION

SHARPNACK, Chief Judge.

Bowyer Excavating, Inc. ("Bowyer") appeals from a prejudgment garnishment order obtained by the Indiana Department of Environmental Management ("IDEM") against RLG, Inc. ("RLG") and Lawrence Roseman d/b/a Spring Valley Landfill. ¹ In addition, Bowyer appeals from the denial of its motion to intervene. Bowyer raises five issues for our review, which we consolidate and restate into the following two dispositive issues:

(1) whether the trial court's order for prejudgment garnishment was void for lack of subject matter jurisdiction;

(2) whether the trial court erred by staying Bowyer's writ to execute on the funds held by the trial court clerk pursuant to the court's prejudgment garnishment order.

We affirm in part, reverse in part, and remand. ²

This case arises from two separate actions filed in the Wabash Circuit Court, the appeals of which were consolidated pursuant to the order of this court. Both actions relate to the closure of the Spring Valley Landfill ("landfill"). The owner of the landfill, RLG, was named as a defendant in both actions.

The first action was filed by IDEM against RLG and Roseman, the president of RLG (hereinafter referred to as the "IDEM action"). The IDEM action was initiated on August 26, 1993, when IDEM filed a complaint for injunctive relief and civil penalties. The complaint alleged several violations of Indiana's environmental laws, including RLG's failure to close the landfill. The complaint requested equitable relief remedies and an order for RLG to pay a civil penalty in the amount of $25,000 per day for each violation. The complaint also alleged that Roseman was personally liable for RLG's action.

On October 28, 1993, IDEM and RLG entered into an agreement relating to the activities of the landfill. Soon after, IDEM alleged that RLG failed to comply with the agreement and, as a result, filed several motions for prejudgment relief. One of the motions was for prejudgment garnishment, which alleged that a nonparty, Republic Waste Industries, Inc. ("Republic Waste"), was in possession of a sum of money belonging to RLG.

On May 5, 1994, the trial court granted IDEM's motion for prejudgment garnishment and directed Republic Waste to pay those sums held on behalf of RLG to the clerk of the Wabash Circuit Court ("clerk") until further order. Later, Republic Waste deposited $250,000 with the clerk.

The second action arose on April 20, 1994, when Bowyer filed its complaint for damages and to foreclose a mechanic's lien against RLG, IDEM, and other defendants not relevant to this appeal (hereinafter the "Bowyer action"). This complaint alleged that Bowyer had not been compensated for work performed in connection with RLG's effort to close the landfill. The complaint sought the alleged outstanding $40,187.05 balance owed to Bowyer. On May 17, 1994, IDEM entered its appearance. Although RLG was served, it failed to answer the complaint and, as a result, the Bowyer court ³ entered a default judgment against RLG in favor of Bowyer for a sum of $47,194.53.

Bowyer then attempted to collect its judgment in two ways. First, Bowyer filed a petition for leave to intervene in the IDEM action. In its petition, Bowyer claimed it had an interest in the $250,000 fund held by the clerk. Bowyer requested that it be permitted to intervene as a matter of right to protect its interest in the fund. This motion was later denied by the IDEM court on August 17, 1995.

Second, in its own action, Bowyer initiated collection efforts, which eventually resulted in the filing of proceedings supplemental on March 6, 1995. As part of these proceedings, Bowyer sent interrogatories to Republic Waste and the clerk to ascertain the manner in which the money was ordered by the IDEM court to be forwarded to the clerk.

On April 21, 1995, the Bowyer court conducted a hearing on Bowyer's proceedings supplemental. At the hearing, Bowyer argued that the IDEM court lacked subject matter jurisdiction to order the garnishment, which resulted in the $250,000 deposit to the clerk, and that the order was void. In addition, Bowyer argued that it was entitled to collaterally attack the garnishment order because it was not given the opportunity to contest the garnishment order in the IDEM action. Next, Bowyer argued that it had a valid lien against the fund because it filed proceedings supplemental and because it served interrogatories on the clerk. Finally, Bowyer concluded that because the IDEM court's garnishment order was void, Bowyer was the only party holding a valid lien on the $250,000 fund and, therefore, that its $47,194.53 judgment should be satisfied from the fund. On June 15, 1995, the Bowyer court ordered that Bowyer's request for execution on the fund be stayed and that the funds be subject first to IDEM's liens and then to Bowyer's lien.

On July 12, 1995, Bowyer filed a motion to correct error as to its request for execution. This motion was denied. Bowyer now appeals both the denial of its request for execution by the Bowyer court and the denial of its motion to intervene by the IDEM court.

I.

The first issue for our review is whether the IDEM court's order for prejudgment garnishment is void for lack of subject matter jurisdiction. Subject matter jurisdiction refers to a court's power to hear and determine a general class or kind of case. State ex rel. Hight v. Marion Super. Ct., 547 N.E.2d 267, 269 (Ind.1989). The absence of subject matter jurisdiction renders a judgment void. Id. Void judgments can be attacked directly or collaterally at any time. Id.; Santiago v. Kilmer, 605 N.E.2d 237, 239 (Ind.Ct.App.1992), reh 'g denied, trans. denied. The issue of subject matter jurisdiction may be resolved by determining whether the claim involved falls within the general scope of authority conferred on a court by the Indiana Constitution or by statute. Hight, 547 N.E.2d at 267.

Bowyer does not contest that the IDEM court had subject matter jurisdiction over IDEM's suit against RLG. Rather, Bowyer argues that the IDEM court lacked subject matter jurisdiction to order the prejudgment garnishment of the $250,000 held by Republic Waste and, therefore, that the order is open to collateral attack.

During the hearing on Bowyer's supplemental proceedings, IDEM argued that the prejudgment garnishment order was valid based on three legal authorities: Ind.Code § 34-1-11-1 et. seq., Ind. Trial Rule 64(B)(1) and T.R. 64(B)(3). Because IDEM contended that the order was not void, it concluded that Bowyer could not collaterally attack it. In staying Bowyer's request for execution against the $250,000, the Bowyer court did not indicate whether it upheld the order because a collateral attack was inappropriate or because the order was valid on its face. Bowyer now challenges each of the three bases identified by IDEM in support of its argument that the prejudgment garnishment order was proper. ⁴

A. I.C. § 34-1-11-1

et. seq.

Prejudgment attachment and garnishment are governed by I.C. § 34-1-11-1 et. seq. An "attachment" is "the legal process of seizing another's property in accordance with a writ or judicial order for the purpose of securing satisfaction of a judgment yet to be rendered." BLACK'S LAW DICTIONARY 126 (6th ed. 1990). Attachment proceedings are governed by I.C. § 34-1-11-1 through I.C. § 34-1-11-19.

A "garnishment" is "a proceeding whereby a plaintiff creditor, i.e., garnishor, seeks to subject to his or her claim the property or money of a third party, i.e., garnishee, owed by such party to defendant debtor...." BLACK'S LAW DICTIONARY 680 (6th ed. 1990); see Lakeshore Bank & Trust v. United Farm Bureau, 474 N.E.2d 1024, 1026 (Ind.Ct.App.1985). The authority to seek a garnishment is set forth by I.C. § 34-1-11-20.

The parties dispute whether the prejudgment possession here constituted an attachment or a garnishment and also dispute whether there is any distinction between the two. However, the statute sets forth separate requirements for each. Thus, an attachment applies when the plaintiff seeks to attach "the property of the defendant," I.C. § 34-1-11-1, and a garnishment applies where a third party possesses or controls the defendant's property. I.C. § 34-1-11-20.

We find any technical distinction between the two to be irrelevant for our review. We also find irrelevant the appellees' claim that the IDEM court actually intended an "attachment" of RLG's property. In its order, the IDEM court clearly sought to seize defendant-RLG's property which was held by a third party; "the Plaintiff is granted prejudgment attachment of those sums held by the Garnishee defendant, Republic Waste Industries on behalf of the Defendant RLG, Inc. or RLG Corporation." Record, p. 71. Therefore, we turn to that part of the statute governing garnishments.

Ind.Code § 34-1-11-20 provides in part that "[i]n all personal actions arising upon contract, express or implied, or upon a judgment or decree of any court," the plaintiff can file an affidavit with the court indicating that the person named in the affidavit possesses or controls the defendant's property. I.C. § 34-1-11-20. Because the suit filed by IDEM against RLG did not arise upon a contract, this section is inapplicable. ⁵ Therefore, the IDEM court did not have statutory authority to enter the order for...