Mayhew v. Deister

Decision Date18 February 1969
Docket NumberNo. 2,No. 867A54,867A54,2
Citation244 N.E.2d 448,144 Ind.App. 111
PartiesO. W. MAYHEW and L. T. Huston, Jr., Appellants, v. Martin DEISTER et al., Appellees
CourtIndiana Appellate Court

William P. Foreman, Bamberger, Foreman, Oswald & Hahn, Evansville, for appellants.

William Statham, McCray, Clark, Statham & McCray, Evansville, for appellees.

SHARP, Judge.

This is an appeal from a judgment sustaining Defendants-Appellees' Motion for Summary Judgment. The action brought by Plaintiffs-Appellants was for damages sustained as the result of the failure of Appellees to prepare a true, correct and complete abstract of title to real estate. One legal paragraph of the complaint alleged that the Appellees, who were engaged in the business of preparing abstracts were negligent in the preparation of the abstract in that they omitted certain records and the Appellants were damaged thereby. The second legal paragraph of the Appellants' complaint asserted that the Appellants were damaged by the breach by Appellees of a contract to carefully prepare a true and complete abstract.

The Appellees' answer principally contended that certain findings of fact and conclusions of law in a Federal Court quiet title action was res judicata as to certain depositive facts and as such, a bar to the complaint of the Appellants. The trial court sustained the unverified Motion for Summary Judgment filed by the Appellees, which motion contained a stipulation of the parties concerning findings of fact by the Federal Court in the quiet title action. No affidavits were filed in support of or in opposition to the Motion for Summary Judgment.

To understand fully the questions presented by this appeal it is necessary to examine the somewhat intricate factual background.

The land for which the abstract in question was eventually prepared was owned in 1951 by Mrs. Juanita Callard and Mrs. Mary Fleming. The land was a 160 acre tract in Gibson County, Indiana. In May of 1951 an oil and gas lease of the 160 acres was executed with the lessees being one Barron Kidd, A. W. Barry and George Greer. The lease, was for a primary term of one year with a provision that the lease would continue so long thereafter as oil was produced.

Up until November 1952 five oil wells were drilled on the 160 acre tract. Only three of these wells were producers of oil.

After November 1952 the owners, Fleming and Callard, made repeated written demands on the lessees for information as to oil production and further prospective development and in October of 1953 they notified the lessees that unless the property was developed in ninety days the lease would be forfeited for breach of the implied covenant to develop the property.

On March 20, 1954, a quiet title suit was filed in the Gibson Circuit Court against the lesses by the owners and on June 15, 1954, a default judgment of 130 of the 160 acres was entered in favor of Mrs. Fleming and Mrs. Callard.

The Appellants in 1958 negotiated with Barron Kidd and the other lessees for purchase of the entire 160 acre leasehold and a purchase of this leasehold was made by the Appellants in July, 1958.

In July 1959 the Appellants assigned a one-fourth interest in the oil lease to one Fred Keller and one-fourth to one R. L. Keller.

The Appellants claim that the purchase of the leasehold was made in reliance upon an abstract prepared for the Appellants by the Appellees, which abstract omitted as a part thereof the default judgment in the quiet title suit in the Gibson Circuit Court against Barron Kidd and the other original lessees.

The Appellants, along with Fred and R. L. Keller, filed a quiet title suit in the United States District Court, Southern District of Indiana, against the owners of the land, Callard and Fleming.

The Appellants notified the Appellees of this suit and demanded that they assume its prosecution but the Appellees did not so do.

The findings of fact of the Federal District Court were attached to the Motion for Summary Judgment. The United States District Court found that the plaintiffs had actual knowledge of the quiet title suit which had cancelled the lease as to 130 acres. The Court further found that the Appellants were guilty of conversion in that they entered on the 130 acres without the permission of the owners and opened and worked an oil well and retained the proceeds therefrom.

The abstract in question was certified to July 7, 1958, and the certification read in part as follows:

'We further certify that there are no judgments, transcripts of judgments, liens unsatisfied, or suits pending on file or of record in any Court of Record in said County (Gibson) against any of the persons mentioned in said abstract, which affect the title to the lands described in the caption of said abstract.'

The only question now before this court is whether it was error to grant Appellees' Motion for Summary Judgment. The Indiana Summary Judgment statute, Burns' Indiana Statutes Annotated, Section 2--2524, is patterned after Rule 56 of the Federal Rules of Civil Procedure and provides in part as follows:

'The judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.'

The Indiana Summary Judgment Rule also contains the following provision which was added to Federal Rule 56 by amendment in 1963:

'When a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of his pleading, but his response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If he does not so respond, summary judgment, if appropriate, shall be entered against him.'

This provision is also included in Section 2--2524(e) in Burns' Indiana Statutes Annotated (1968 Replacement).

Although there was no response by the Appellants to the Motion for Summary Judgment, we do not believe that the above cited provision eliminates the necessity of finding that no genuine issue as to any material fact exists. Our Supreme Court so held in Kapusta v. DePuy Manufacturing Company, Ind., 234 N.E.2d 487 (1968), stating:

'We construe the words 'if appropriate' in subsection (e), in light of subsection (c) to still require a finding that there is no genuine issue as to any material fact.'

This interpretation is in accord with the intent and purpose of the amendment to Federal Rule 56, as embodied in the Advisory Committee's Notes. That note emphasizes the fact that the amendment does not 'affect the ordinary standards applicable to the summary judgment motion', i.e., the necessity of a finding that no genuine issue as to any material fact exists.

Our Summary Judgment Statutes, Burns' Indiana Statute Annotated, Section 2--2524, is identical to Rule 56 of the Federal Rules of Civil Procedure. There is a growing body of case law both in Indiana and in the Federal Court system to guide our trial courts in this summary judgment area. The earliest expression in Indiana was in Jose v. Indiana National Bank, Ind.App., 218 N.E.2d 165 (1966) in which this court stated at page 167 of 218 N.E.2d:

'This court closely scrutinizes adjudications on the pleadings with a narrow eye, ever vigilant for a possible error, and will not hesitate to reverse a decision if an error be found, unless the error itself was harmless and reversal would serve no useful purpose.'

This attitude is well borne out by our Supreme Court in Kapusta v. DePuy Manufacturing Company, supra. In Poller v. Columbia Broadcasting System, 368 U.S. 464, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962), the Supreme Court of the United States made it very clear that the summary judgment rule authorized summary judgment only when the moving party was entitled to judgment as a matter of law, and that 'the purpose of the rule is not to cut litigants off from their right of trial by jury if they really have issues to try.' See also White Motor Co. v. United States, 372 U.S. 253, 83 S.Ct. 696, 9 L.Ed.2d 738 (1963).

The United States Court of Appeals for the Seventh Circuit in dealing with summary judgment has stated:

'In deciding whether there is an issue of material fact in a case, all doubts must be resolved against the party asking for a summary judgment.' (emphasis added) Greenebaum Mortgage Company v. Town and Garden Associates, 385 F.2d 347 (7th Cir. 1967). See also Carter v. Williams, 361 F.2d 189 (7th Cir. 1966), Moutoux v. Gulling Auto Electric, Inc., 295 F.2d 573 (7th Cir. 1961) and Progress Development Corp. v. Mitchell, 286 F.2d 222 (7th Cir. 1961).

There is also a line of Federal cases which have held that summary judgment should not be granted if there is 'slightest doubt' as to facts. See National Screen Service Corp. v. Poster Exchange, Inc., 305 F.2d 647 (5th Cir. 1962).

Barron and Holtzoff, Federal Practice and Procedure (Wright Ed.), Volume 3, Section 1235, at pages 138--141, states:

'One who moves for summary judgment has the burden of demonstrating clearly that there is no genuine issue of fact. Any doubt as to the existence of such an issue is resolved against him. The evidence presented at the hearing is liberally construed in favor of the party opposing the motion and he is given the benefit of all favorable inferences which might reasonably be drawn from the evidence. Facts asserted by the party opposing the motion and supported by affidavit or other evidentiary material must be taken as true.'

In the 1968 pocket supplements to Barron and Holtzoff, under section 1237 of Volume 3 at page 109, it states:

'Since the moving party must show that he is entitled to prevail as a matter of law while the opposing party need show only that a genuine controversy as...

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