Norris Ave. Prof'l Bldg. P'ship v. Coordinated Health, LLC

• Decision Date: 25 March 2015
• Docket Number: No. 40A01–1408–PL–349.,40A01–1408–PL–349.
• Citation: 28 N.E.3d 296
• Parties: NORRIS AVENUE PROFESSIONAL BUILDING PARTNERSHIP, Appellant–Plaintiff, v. COORDINATED HEALTH, LLC, Appellee–Defendant.
• Court: Indiana Appellate Court

28 N.E.3d 296

NORRIS AVENUE PROFESSIONAL BUILDING PARTNERSHIP, Appellant–Plaintiff

v.COORDINATED HEALTH, LLC, Appellee–Defendant.

No. 40A01–1408–PL–349.

Court of Appeals of Indiana.

March 25, 2015.

Sean M. Clapp, Ian T. Keeler, Clapp Ferrucci, Fishers, IN, Attorneys for Appellant.

David B. Honig, Andrew B. Howk, Hall Render Killian Heath & Lyman, PC, Indianapolis, IN, Attorneys for Appellee.

NAJAM, Judge.

Statement of the Case

[1] Norris Avenue Professional Building Partnership (“Norris”) appeals the trial court's judgment for Coordinated Health, LLC (“Coordinated Health”) on Norris' complaint for breach of a lease agreement. Norris raises a single issue for our review, namely, whether the trial court erred when it concluded that Coordinated Health did not breach the lease agreement. We reverse and remand with instructions.

Facts and Procedural History

[2] On April 29, 2002, Norris and Coordinated Health entered into a lease agreement whereby Coordinated Health agreed to lease certain real property from Norris.¹ The parties' lease provided for an “initial term” of two years to be followed by two “option terms” of five years each. Appellant's App. at 13. In particular, the lease stated in relevant part as follows:

Section 2.1 Initial Term. The initial term of this Lease shall be for a period of two (2) years ... commencing on May 1, 2002, and terminating on April 30, 2004. In the event that [Coordinated Health] wishes to exercise either of the option terms set forth in Section 4.1, at least sixty (60) days prior to the end of the initial term or the first option term, as the case may be, [Coordinated Health] shall give written notice to [Norris] of intent to exercise the option. In the event [Coordinated Health] does not provide such notice, then this Lease will terminate at the end of the then[-]current term unless [Norris] and [Coordinated Health] agree otherwise.

* * *

Section 4.1 Minimum Annual Rent. [Coordinated Health] covenants and agrees to pay ... as rent for said Premises ... the sums as set for[th] below: $2250.00 per month beginning May 1, 2002[,] in advance on the first day of each calendar month of the term....

Rent for the 1st five (5) year option term will be $2,300/month for the 1st year, $2,350/month for the 2nd year, $2,400/month for the 3rd year, $2450/month for the 4th year, and $2,500/month for the 5th year. In the event [Coordinated Health] exercises its option for the 2nd five (5) year option term, rent per month for the 1st year of the second option term shall be calculated by taking the monthly rent for the 6th year of the 1st option term and increasing said monthly rental by the change in the CPI–Urban [the Consumer Price Index for Urban Consumers] for the twelve month period ending three (3) months prior to the beginning of the 1st year of the 2nd option term. For each year of the 2nd option term thereafter, the monthly rental amount shall be increased by the change in the CPI–Urban for the twelve (12) month period ending three (3) months prior to the beginning of said year.

* * *

Section 14.1 Surrender of Premises. At the end of the term or any renewal thereof or other sooner termination of this Lease, [Coordinated Health] will peaceably deliver to [Norris] possession of this Premises....

* * *

Section 15.1 Waiver. The waiver (or failure to insist upon strict performance) by [Norris] or by [Coordinated Health] of any term, covenant, or condition herein contained shall not be deemed to be waiver of such term, covenant, or condition or any subsequent breach of the same or other term, covenant, or condition contained herein....

Id. at 13–15, 21–22.

[3] Coordinated Health did not provide Norris with notice that it intended to exercise the first option term within sixty days of the expiration of the initial term. Nonetheless, Coordinated Health did not surrender the premises upon the end of the initial term, and it paid rent to Norris for the entirety of the first option term in amounts equivalent to those delineated in the lease for the first option term.

[4] As the end of the first option term approached, Coordinated Health did not provide Norris with notice that it intended to exercise the second option term within sixty days of the expiration of the first option term. Nonetheless, Coordinated Health did not surrender the premises upon the end of the first option term, and, for a time, it paid rent to Norris in amounts equivalent to those delineated in the lease for the second option term. The second option term was scheduled to end on April 30, 2014.

[5] In October of 2010, Coordinated Health informed Norris that it would terminate its tenancy as of April 30, 2011. The parties were unable to successfully negotiate a termination agreement, and, by April 30, 2011, Coordinated Health had surrendered the premises and paid all rents due up to that time.

[6] On June 7, 2011, Norris filed suit against Coordinated Health. Norris alleged that Coordinated Health had breached the parties' lease agreement and that Coordinated Health owed Norris a sum equivalent to the balance of rent from May 1, 2011, through April 30, 2014, or the remainder of the second option term. After the trial court denied the parties' respective motions for summary judgment, the parties entered a joint stipulation of facts and moved for judgment without an evidentiary hearing. On June 2, 2014, the trial court entered a general judgment for Coordinated Health. Thereafter, the court denied Norris' motion to correct error. This appeal ensued.

Discussion and Decision

Standard of Review

[7] Norris appeals the trial court's judgment for Coordinated Health. But the parties initially dispute our standard of review. Norris asserts that our standard of review is de novo, while Coordinated Health asserts that we must review the trial court's judgment under the clearly erroneous standard. Norris is correct.

[8] This appeal involves only a written contract and a written, joint stipulation of facts. It is well established that, where “only a paper record has been presented to the trial court, we are in as good a position as the trial court ... and will employ de novo review....” Munster v. Groce, 829 N.E.2d 52, 57 (Ind.Ct.App.2005) ; see also Houser v. State, 678 N.E.2d 95, 98 (Ind.1997) (holding that, where “both the appellate and trial courts are reviewing the paper record ..., there is no reason for the appellate courts to defer to the trial court's finding....”). The clearly erroneous standard, on the other hand, is “our usual review ... when the trial court is in the unique position of determining the ... facts.” Anderson v. Wayne Post 64, Am. Legion Corp., 4 N.E.3d 1200, 1206 n. 6 (Ind.Ct.App.2014), trans. denied.

[9] Those basic principles aside, Coordinated Health asserts that the clearly erroneous standard applies “when facts are stipulated to by the parties and entered into evidence by the trial court.” Appellee's Br. at 8. In support, Coordinated Health cites England v. Alicea, 827 N.E.2d 555, 558 (Ind.Ct.App.2005). In England, this court reviewed whether the trial court erred in its partition of certain real property, and we stated:

Where, as here, the trial court enters specific findings of fact and conclusions of law, we employ a two-tiered standard of review. First, we determine whether the evidence supports the findings; then we determine whether the findings support the judgment. Butler Univ. v. Unsupervised Estate of Verdak, 815 N.E.2d 185, 190 (Ind.Ct.App.2004). However, inasmuch as stipulated facts are conclusive upon both the parties and the tribunal, the findings of fact may not be challenged upon appeal. Wayne Township v. Lutheran Hosp. of Fort Wayne, Inc., 590 N.E.2d 1130, 1133 (Ind.Ct.App.1992). Thus, we will only look to the conclusions of law and whether the findings and conclusions support the judgment. We will consider only the evidence and reasonable inferences flowing therefrom that support the trial court's judgment, and we will not reweigh the evidence. Id. We will only disturb the judgment if we determine that it is clearly erroneous, meaning that there are no facts or inferences supporting it. Id. A judgment is clearly erroneous when a review of the record leaves us with a firm conviction that a mistake has been made. Id.

Id. (emphasis added).

[10] England does not control here for two significant reasons. First, England does not hold that the clearly erroneous standard of review applies when only a paper record is at issue on appeal. Rather, as relevant here England merely noted that factual stipulations may not later be challenged on appeal. Id.; see also Wayne Township, 590 N.E.2d at 1133 (“stipulated facts are conclusive upon both the parties and the tribunal, and ... a party cannot properly challenge facts on appeal which it has stipulated to below”). Thus, we do not agree with Coordinated Health's reading of England. Neither England nor Wayne Township, the case England relied on, state that we are obliged to apply the clearly erroneous standard of review to a paper record.

[11] Second, no party to the instant appeal challenges the stipulated facts, and, unlike in England, the trial court here did not enter findings of fact and conclusions thereon following a bench trial. Indeed, nothing about the court's judgment in the instant matter indicates that the court acted as a fact finder or in any way applied its unique position to determine any facts. See Anderson, 4 N.E.3d at 1206 n. 6. In other words, nothing about this appeal suggests that the trial court was in a better position than this court to address the facts and the law. As such, we owe the trial court no deference in our review. See, e.g., Houser, 678 N.E.2d at 98 ; Munster, 829 N.E.2d at 57.

Arguments on Appeal

[12] Turning to the arguments on appeal, we first briefly reject Coordinated Health's argument that we must affirm the trial court's judgment because Norris did not file a brief in the trial court in support of the parties' request for judgment...