Finley v. Finley, 3-776A163

Citation174 Ind.App. 362,367 N.E.2d 1126
Decision Date03 October 1977
Docket NumberNo. 3-776A163,3-776A163
PartiesCharles O. FINLEY, Appellant (Respondent Below), v. Shirley M. FINLEY, Appellee (Petitioner Below).
CourtCourt of Appeals of Indiana

Saul I. Ruman, Hammond, for appellant.

Leon R. Kominski, John E. Newby, Jr., Edward L. Volk, LaPorte, for appellee.

STATON, Presiding Judge.

In a dissolution of marriage action, the trial court imposed discovery sanctions against the husband under Ind. Rules of Procedure, Trial Rule 37(B) (2)(c). The sanctions imposed by the trial court's order required that the husband pay for the audit of the Charles O. Finley and Company, Inc., an Illinois Corporation, and pay the wife's attorneys an additional attorneys' fee of $50,000.00. The husband appeals from this interlocutory order and presents these issues for our review:

(1) Did the trial court abuse its discretion when it ordered the husband to produce all the books, records, and other financial information which may be requested by an accounting firm and to pay for the completed audit?

(2) Did the trial court abuse its discretion by ordering additional attorney fees pendente lite for the wife's attorneys?

After reviewing the record and the issues presented by the husband's appeal, we conclude that the trial court did not abuse its discretion. We affirm the trial court's interlocutory order.

I. Discovery Sanction

The husband is the president of the corporation and is in complete control of its management. After October 31, 1971, no profit and loss statements or balance sheets existed which would reflect the present value of the corporation. The husband holds thirty-one per cent of the corporate stock and the wife holds twenty-nine per cent of the corporate stock. The remaining forty per cent of the corporate stock which is not part of the marital estate is divided equally among four of their children. Neither the wife's counsel nor the trial court can proceed until the value of the corporation is determined by current, reliable financial information. After a hearing on the wife's petition for sanctions against the husband, the trial court found that the husband had "failed to comply with discovery rules on numerous occasions . . ." and the divorce proceedings had "been delayed by failure of the Respondent to furnish such information as alleged in the petition which information is not available to the Petitioner from any other source." The husband has admitted that much of the financial information requested by the discovery is either unavailable or does not exist.

The husband contends that TR. 37(B)(2)(c) allows only expenses for the enforcement of the discovery order to be charged against him. The trial court's sanction of assessing the entire audit expense against him is an abuse of discretion. 1

The trial court specifically found in its order of June 7, 1976, that "the allegations of the petition filed February 13, 1976, are true. . . ."

The sanctions imposed by subdivision (B) of the Indiana Rule follow in general the scheme of the sanctions imposed by Federal Rule of Civil Procedure 37. 3 Harvey, Indiana Practice 122. In addition to providing specific sanctions, Fed.R.Civ.P. 37(b)(2), permits the trial court to make such orders "as are just." 2 The intent of Fed.R.Civ.P. 37(b) has been explained by Dean William Harvey as follows:

"It is for failure to comply with an order that the court is given its broadest discretion; under rule 37(b) it may make such orders 'as are just,' including certain specifically enumerated sanctions. The imposition of a sanction in this situation serves the dual purpose of compelling the production of relevant information and vindicating the dignity of the court." (Footnote omitted). 2 Harvey, Indiana Practice 522, 523.

Although the Indiana Rule does not contain a provision for orders "as are just" to compel discovery, we are compelled to conclude that the sanction imposed by the trial court is not an abuse of discretion. The intent and purpose of the Rule together with the inherent power of the trial court to do those things which are necessary to move the proceedings along to judgment support this conclusion. Any other construction of the Rule would render a property settlement in the present dissolution of marriage action impossible. 3

II. Attorney Fees

Upon the petition of the wife for additional attorney fees and, later, a hearing on the petition, the trial court awarded the wife $50,000.00 additional attorney fees. One of the wife's attorneys, John E. Newby, testified that the wife had received legal services in the amount of $23,400.00 and that he had expended cash disbursements in excess of $4,800.00 to third parties in behalf of the wife. Since the husband had moved for change of venue from the county, the wife has had the additional expense of obtaining local counsel in Valparaiso, Indiana. This local counsel has not been paid for his legal services rendered to the wife. Additionally, the employment of local counsel in California, Illinois, and other states is anticipated. Mr. Newby further testified:

"Well, you recall, you and Mr. Ruman...

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9 cases
  • Finley v. Kesling
    • United States
    • United States Appellate Court of Illinois
    • March 18, 1982
    ...cent of the corporate stock which is not part of the marital estate is divided equally among four of their children." Finley v. Finley (Ind.App.1977), 367 N.E.2d 1126, 1127. The Illinois trial judge granted the motion to dismiss and dismissed the proceedings with prejudice. The written orde......
  • Hawblitzel v. Hawblitzel
    • United States
    • Indiana Appellate Court
    • April 21, 1983
    ...as a result of that obstreperousness. See, e.g., Finley v. Finley, 422 N.E.2d 289 (Ind.App., 4th Dist., 1981); Finley v. Finley 367 N.E.2d 1126 (Ind.App., 3rd Dist., 1977). At trial, petitioner's counsel testified that he had, through the time of trial, expended 147.57 hours on this case, a......
  • Marriage of Julien, In re
    • United States
    • Indiana Appellate Court
    • December 11, 1979
    ...with their liabilities at the same time. Ms. Julien attempts to persuade us that, on the basis of the holding in Finley v. Finley (1977), Ind.App., 367 N.E.2d 1126, we should reverse the trial court's judgment. In Finley, the husband had refused to cooperate with the wife's attorney in supp......
  • Chrysler Corp. v. Reeves
    • United States
    • Indiana Appellate Court
    • May 22, 1980
    ...in the above federal cases are those which this state has also found important. TR. 1; Clark County State Bank, supra; Finley v. Finley, (1977) Ind.App., 367 N.E.2d 1126. For example, in Finley the court said "(t)he intent and purpose of the Rule together with the inherent power of the tria......
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