Masonic Temple Ass'n v. Ind. Farmers Mutual, 54A01-0409-CV-416.

• Decision Date: 29 November 2005
• Docket Number: No. 54A01-0409-CV-416.,54A01-0409-CV-416.
• Citation: 837 N.E.2d 1032
• Parties: MASONIC TEMPLE ASSOCIATION OF CRAWFORDSVILLE, Appellant-Plaintiff, v. INDIANA FARMERS MUTUAL INSURANCE COMPANY, Appellee-Defendant.
• Court: Indiana Supreme Court

Page 1032

837 N.E.2d 1032

MASONIC TEMPLE ASSOCIATION OF CRAWFORDSVILLE, Appellant-Plaintiff, v. INDIANA FARMERS MUTUAL INSURANCE COMPANY, Appellee-Defendant.

No. 54A01-0409-CV-416.

Court of Appeals of Indiana.

November 29, 2005.

James E. Ayers, Wernle, Ristine & Ayers, Linden, for Appellant.

Mark R. Smith, Smith Fisher Maas & Howard, P.C., Indianapolis, for Appellee.

OPINION

KIRSCH, Chief Judge.

Masonic Temple Association of Crawfordsville ("Masonic Temple") appeals the trial court's grant of summary judgment in favor of Indiana Farmers Mutual Insurance Company ("Indiana Farmers") on Masonic Temple's claim for damages in its breach of contract complaint. Masonic Temple raises two issues, which we restate as:

I. Whether the trial court abused its discretion when it struck portions of the affidavit of Michael McKeown and

II. Whether the trial court properly granted Indiana Farmers' summary judgment motion on Masonic Temple's damage claims.

We reverse and remand.

FACTS AND PROCEDURAL HISTORY

This court previously described the background facts as follows:

During late 1999 and early 2000, the City of Crawfordsville, Indiana was constructing a new Police Department building adjacent to the north side of the Masonic Temple. In mid-December, the construction crew undertook excavation to a depth of six to seven feet deeper than the footing of the Masonic Temple. Concrete was poured in late December, before a period of cold weather and the holidays, during which the excavation area apparently remained exposed and lacking a retaining wall to provide soil support. A rainstorm occurred on February 17 and 18, 2000.

On February 19, 2000, the Secretary of the Masonic Temple discovered cracks in the walls and ceiling of the kitchen. Further investigation revealed damage to the exterior brick walls and throughout every level of the building, including the basement. The Masonic Temple implemented emergency procedures to prevent further deterioration or collapse.

On February 19, 2000, Masonic Temple notified its insurer, Indiana Farmers, of the loss.

. . . .

On June 23, 2000, Indiana Farmers denied the Masonic Temple's claim, citing an "earth movement" exclusion and further claiming that the loss did not fall within additional "collapse coverage" because the building did not totally collapse. The parties subsequently communicated by letter, each citing case law allegedly favorable to its proposed definition of "earth movement." On June 28, 2000, Indiana Farmers offered in writing to initiate a declaratory judgment action, contingent upon the submission of a joint stipulation of facts to the trial court.

On August 4, 2000, the Masonic Temple filed its Complaint for Declaratory Relief, asserting that its loss was due to faulty construction excavation methods and requesting that the trial court determine its right to coverage under the Indiana Farmers policy. Farmers filed third party complaints against the contractors, engineers and architects involved in the City of Crawfordsville construction project.

Masonic Temple Ass'n of Crawfordsville v. Ind. Farmers Mut. Ins. Co., 779 N.E.2d 21, 24-25 (Ind.Ct.App.2002), trans. denied.

On May 22, 2001, Masonic Temple amended its complaint to include a bad faith/punitive damages claim against Indiana Farmers. Appellant's App. at 90-94. On February 5, 2002, the trial court granted partial summary judgment on the bad faith claim in favor of Indiana Farmers. Appellee's App. at 461-62. On an interlocutory appeal, this court affirmed the grant of summary judgment. See Masonic Temple, 779 N.E.2d at 30.

On May 8, 2002, Masonic Temple amended its complaint to include direct negligence claims against the contractors, engineers, and architects involved in the construction project as well as the City of Crawfordsville. Appellant's App. at 95-104. In early March of 2003, all parties participated in a mediation/settlement conference, which resulted in a settlement agreement. Appellant's App. at 131-45. In the typed settlement agreement, Masonic Temple released all of its claims except the following claim against Indiana Farmers:

a. The Masons' breach of contract claim against Farmers shall remain pending, but said claim is limited to those damages consisting of:

i. Attorney Fees

ii. Litigation Expenses

iii. Costs

iv. Investigation Costs and Expenses

And will be limited to $100,000 . . .

Appellant's App. at 134. The settlement agreement also stated:

Any prior negotiations, discussions or agreements are merged into this agreement, shall not operate to alter, modify, impair or affect this agreement or the interpretation of this agreement, and are inadmissible as evidence in any legal proceedings. This agreement supercedes any prior agreements, written or oral, respecting the subject matter hereof.

Appellant's App. at 137.

On March 9, 2004, Indiana Farmers filed a motion for summary judgment, arguing that even if Masonic Temple prevailed in its breach of contract claim, the claims for attorney fees, litigation expenses, costs, and investigation costs and expenses were not recoverable damages under that claim and also that Masonic Temple had released some of its claims. Appellant's App. at 111-22. Masonic Temple responded and, in its response, included an affidavit of its president, Michael McKeown ("the McKeown affidavit"), which attempted to authenticate a prior, handwritten version of the typed settlement agreement and also attempted to define various terms contained in the settlement agreement. Appellant's App. at 164-66.

Indiana Farmers moved to strike portions of this affidavit, claiming that it violated the parol evidence rule, ADR Rule 2.12 concerning the confidentiality of mediation communications, Indiana's "four corners rule" of contract construction, and the merger clause in the settlement agreement, and also that it constituted an impermissible attempt to define legal terms by a layperson. Appellee's App. at 561-71. A hearing was held on the motion for summary judgment on July 21, 2004. On July 29, 2004, the trial court ordered paragraphs 5-12 of the McKeown affidavit and the handwritten version of the agreement to be stricken from the record. Appellant's App. at 83-84. On the same date, the trial court also granted Indiana Farmers' motion for summary judgment, stating:

1. Pursuant to Trial Rule 56, there are no genuine issues of material fact upon any of the specifications reserved in the parties' Settlement Agreement except for the specification delineated as "Costs." The Court finds, therefore, that the Defendant, Indiana Farmers Mutual Insurance Company, is entitled to judgment as a matter of law upon all specifications of damages including attorney fees, litigation expenses, and investigations costs and expenses. The Court finds that the issue as to who should pay costs may be litigated at a trial, but that costs are nominal and generally represent little more than filing fees.

IT IS THUS ORDERED, ADJUDGED AND DECREED that Indiana Farmers Mutual Insurance Company is entitled to judgment as a matter of law upon their motion for judgment against the balance of Masonic Temple Association of Crawfordsville's Amended Complaint, except for the issue of costs.

Appellant's App. at 285-86. The trial court certified its ruling as a final judgment on the partial summary judgment order. Masonic Temple now appeals.

DISCUSSION AND DECISION

As an initial matter, Indiana Farmers contends that Masonic Temple's appeal should be dismissed due to the failure of Masonic Temple to comply with several rules of appellate procedure. Indiana Farmers first claims that Masonic Temple did not include several documents in its appendix that are necessary for resolution of the issues raised on appeal as required by Indiana Appellate Rule 50(A). Under this rule, appellants should include within their appellant's appendix all documents relating to the disposition of the motion for summary judgment, including any documents that appellee designated and filed with the trial court. Kelly v. Levandoski, 825 N.E.2d 850, 856 (Ind.Ct.App.2005), trans. denied. Although failure to include documents designated as evidence by the appellee may result in waiver of the appellant's claim that the trial court erred in granting summary judgment, we prefer to decide issues on their merits when possible. See Hughes v. King, 808 N.E.2d 146, 147-48 (Ind.Ct.App.2004). Despite Masonic Temple's failure to include some of the documents, Indiana Farmers provided the documents in its Appellee's Appendix. Therefore, we can decide the issues on their merits.

Indiana Farmers also contends that Masonic Temple's brief fails to comply with Indiana Appellate Rule 46(A)(5) and (6), which requires that both the statement of the case and the statement of facts be supported by reference to the record on appeal or appendix and that it also fails to comply with Appellate Rule 50(C), which requires that the table of contents of the appendix list each item in the appendix including the item's date. Although every factual statement was not supported by a citation to the record and the table of contents did not contain a date for every item, Masonic Temple has substantially complied with the Appellate Rules and our review has not been thwarted. See Calvary Temple Church, Inc. v. Paino, 555 N.E.2d 190, 192 n. 4 (Ind.Ct.App.1990). We now turn to the merits of this case.

I. The McKeown Affidavit

Masonic Temple argues that the trial court erred when it ordered portions of the McKeown affidavit stricken from the record. Indiana Farmers contends that Masonic Temple has waived review of this issue because it failed to include in its brief any citation to the record or controlling authority to support its argument. We agree. Masonic Temple's sole argument in its appellant brief on this issue is as follows:

The investigation expenses, again, were reserved as a damage item and therefore recoverable. These included all expenses required...