Hawkins v. Auto-Owners (Mut.) Ins. Co.

Citation579 N.E.2d 118
Decision Date02 October 1991
Docket NumberNo. 18A02-9005-CV-287,AUTO-OWNERS,18A02-9005-CV-287
PartiesRuth HAWKINS, as Guardian of Keith L. Lewis, Appellant (Defendant), v.(MUTUAL) INSURANCE COMPANY, and Robert D. Stephens, Appellees (Plaintiff, Defendant).
CourtCourt of Appeals of Indiana

John O. Moss, Indianapolis, for appellant.

Donald K. McClellan, McClellan, McClellan, Brooke & Arnold, Muncie, for appellee Auto-Owners Ins.

BUCHANAN, Judge.

CASE SUMMARY

Defendant-appellant Ruth Hawkins (Hawkins), as guardian of Keith Lewis (Lewis), appeals from the trial court's entry of judgment in favor of plaintiff-appellee Auto-Owners Mutual Insurance Company (Auto-Owners), claiming that the trial court erred when it entered judgment for Auto-Owners without a trial after denying Auto-Owners' motion for summary judgment, that the trial court erred when it failed to disqualify Auto-Owners' attorney, and that the trial court erred when it denied her motion to dismiss Auto-Owners' declaratory judgment action due to the pendency of another action.

We reverse in part and affirm in part.

FACTS

The facts most favorable to the trial court's judgment reveal that on July 20, 1987, Lewis was shot by Robert Stephens in Stephens' home. Stephens was subsequently convicted of attempted murder, and his conviction was affirmed by our Supreme Court. Stephens v. State (1989), Ind., 541 N.E.2d 280. Hawkins, as Lewis' guardian, brought suit against Stephens in the Delaware Superior Court alleging that Stephens negligently shot Lewis.

While that action was pending, Auto-Owners, Stephens' insurer, brought a declaratory judgment action in the trial court (the Delaware Circuit Court) against Stephens and Hawkins, acting as Lewis' guardian. Auto-Owners was seeking to establish that Stephens had intentionally shot Lewis and that Auto-Owners was therefore not liable for Lewis' injuries under Stephens' insurance policy with Auto-Owners, which excludes: "bodily injury or property damage expected or intended by an insured person." Record at 44. Hawkins moved to dismiss the declaratory judgment action because of her pending suit in the Superior Court. Auto-Owners moved for summary judgment.

On February 28, 1990, the trial court entered its judgment. The trial court entered default judgment against Stephens because he had not made an appearance in the case. The trial court denied Hawkins' motion to dismiss and Auto-Owners' motion for summary judgment. The trial court determined that a genuine issue of material fact existed as to whether Stephens' conduct was intentional or negligent. The trial court then entered a judgment on the merits in favor of Auto-Owners.

The trial court considered the transcript of Stephens' criminal trial 1 and concluded that based on that evidence, Stephens had intentionally shot Lewis.

Hawkins filed a motion to correct errors and a motion to disqualify Auto-Owners' attorney on the basis that the attorney had entered an appearance for Stephens in Hawkins' pending negligence action. Auto-Owners' attorney withdrew seven days after making his appearance. Hawkins' motion also alleged that the attorney had represented the State of Indiana as a deputy prosecutor in the criminal prosecution of Stephens and that Lewis had been deposed in that case. Hawkins claimed the attorney should have been disqualified because he might have obtained confidential information from Stephens and because the attorney had represented Lewis in the criminal case. The trial court denied Hawkins' motions.

ISSUES

1. Whether the trial court erred when it entered judgment for Auto-Owners?

2. Whether the trial court erred when it denied Hawkins' motion to dismiss?

3. Whether the trial court erred when it denied Hawkins' motion to disqualify Auto-Owners' attorney?

DECISION

ISSUE ONE--Did the trial court err when it entered judgment for Auto-Owners?

PARTIES' CONTENTIONS--Hawkins argues that after the trial court determined summary judgment was inappropriate, because a genuine issue of material fact existed as to whether Stephens intentionally shot Lewis, it was improper for the trial court to decide that genuine issue of fact without holding a trial. Auto-Owners replies that the trial court's judgment was supported by the evidence.

CONCLUSION--The trial court erred when it entered judgment without conducting a trial.

The trial court's action in denying summary judgment because a genuine issue of material fact existed and then jumping the gap between denial of summary judgment and trial of the issue presented by then deciding the issue, is somewhat puzzling. It is true that summary judgment is inappropriate when material facts are in dispute, Bochnowski v. Peoples Federal S. & L. (1991), Ind., 571 N.E.2d 282, and even if the trial court believes the nonmovant will not succeed at trial, summary judgment is improper if material facts conflict. Travel Craft, Inc. v. Wilhelm Mende GmbH & Co. (1990), Ind., 552 N.E.2d 443.

Here, the trial court correctly decided that a genuine issue of material fact existed, but then went further. Auto-Owners claims summary judgment was appropriate, relying on Allstate Ins. Co. v. Herman (1990), Ind., 551 N.E.2d 844.

In Allstate, the Supreme Court concluded that the trial court erred when it failed to grant the insurance company's motion for summary judgment under a similar factual situation. The Supreme Court reached that conclusion because the insured admitted that he intentionally fired a shot at a group of people. The insured's policy contained an exclusion like the one in Stephens' policy with Auto-Owners. The Court reasoned the admittedly intentional act precluded coverage under the insurance policy.

In sharp contrast, the evidence here indicates that the insured, Stephens, claimed the gun discharged accidentally, not intentionally. In affirming Stephens' conviction for attempted murder, the Supreme Court observed: "Appellant's version of the occurrence was that while he was removing a handgun from his pants the weapon accidentally discharged striking the victim in the neck." Stephens, supra at 281. In this respect, the evidence is different than that considered by the Supreme Court in Allstate. So a genuine issue of fact existed as to whether the shot was intentional, which precludes the entry of summary judgment. The trial court's entry of judgment for Auto-Owners was therefore erroneous.

There is a general rule that the records of proceedings in criminal actions are not admissible in civil actions as proof of the facts upon which a party was convicted. This is particularly true when the civil action is for damages occasioned by the offense for which the party was convicted. Brooks v. State (1973), 259 Ind. 678, 291 N.E.2d 559; Montgomery v. Crum (1928), 199 Ind. 660, 161 N.E. 251; Hambey v. Hill (1971), 148 Ind.App. 662, 269 N.E.2d 394, trans. denied. While no appellate issue has been raised regarding the trial court's consideration of the transcript of Stephens' criminal trial, the transcript would be inadmissible at trial, 2 and could not be relied upon by the trial judge.

The trial court in entering judgment for Auto-Owners also considered the fact that Stephens had been convicted of attempting to murder Lewis, expressly relying upon Ind.Code 34-3-18-1 (1988). To the extent that IC 34-3-18-1 is inconsistent with the rules pronounced by our Supreme Court, we must conclude IC 34-3-18-1 is invalid.

IC 34-3-18-1, enacted in 1982, provides:

"Evidence of a final judgment, entered after a trial or upon a plea of guilty, adjudging a person guilty of a crime punishable by death or imprisonment in excess of one year, shall be admissible in any civil action to prove any fact essential to sustaining the judgment, and is not excluded from admission as hearsay regardless of whether the declarant is available as a witness. The pendency of an appeal may be shown but does not affect the admissibility of evidence under this section."

In Brooks, supra, our Supreme Court unequivocally concluded that: "However, while there are exceptions and even some trend to the contrary indicated in some jurisdictions, Indiana follows the traditional rule that a judgment of conviction in a criminal prosecution is not admissible in a civil case, as evidence of the facts upon which it was based." Id. 259 Ind. at 680, 291 N.E.2d at 560. See also Cromer v. Sefton (1984), Ind.App., 471 N.E.2d 700 ("A conviction in a criminal case is not admissible to establish any of the elements of a civil case." Id. at 705). An exception to the rule exists for the admission of a judgment based on a guilty plea as an admission against interest. See Rediehs Exp., Inc. v. Maple (1986), Ind.App., 491 N.E.2d 1006, cert. denied (1987), 480 U.S. 932, 107 S.Ct. 1571, 94 L.Ed.2d 762; Cromer, supra; Hambey, supra.

There is another statute pertinent to this discussion: Ind.Code 34-5-2-1 (1988) provides, in part:

"All statutes relating to practice and procedure in any of the courts of this state shall have, and remain in, force and effect only as herein provided. The supreme court shall have the power to adopt, amend and rescind rules of court which shall govern and control practice and procedure in all the courts of this state; such rules to be promulgated and to take effect under such rules as the supreme court shall adopt, and thereafter all laws in conflict therewith shall be of no further force or effect." (Emphasis supplied).

The Supreme Court has traditionally determined the rules regarding the admission of evidence at trial. In Matter of Public Law No. 305 and Public Law No. 309 (1975), 263 Ind. 506, 334 N.E.2d 659, the Supreme Court invalidated a portion of the statutes in question because they provided that trial courts would take judicial notice of municipal, city and town ordinances, in contravention of established Supreme Court precedent.

In Stidd v. Dietz (1963), 135 Ind.App. 149, 192 N.E.2d 651, this court elected to follow the "best evidence rule" as...

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