Otter Creek Trading Co. v. PCM Enviro Pty, Ltd.

• Decision Date: 07 June 2016
• Docket Number: No. 40A01–1509–MI–1432.,40A01–1509–MI–1432.
• Citation: 60 N.E.3d 217
• Parties: OTTER CREEK TRADING COMPANY, INC., and Daniel Pohle, Appellants–Defendants, v. PCM ENVIRO PTY, LTD, Appellee–Plaintiff.
• Court: Indiana Appellate Court

60 N.E.3d 217

OTTER CREEK TRADING COMPANY, INC., and Daniel Pohle, Appellants–Defendants,

v.PCM ENVIRO PTY, LTD, Appellee–Plaintiff.

No. 40A01–1509–MI–1432.

Court of Appeals of Indiana.

June 7, 2016.

Rehearing Denied Aug. 8, 2016.

Leanna Weissmann, Lawrenceburg, IN, Attorney for Appellants.

Greg S. Morin, Montgomery, Elsner & Pardieck, LLP, Seymour, IN, Attorney for Appellee.

Case Summary

BRADFORD

, Judge.

[1] Appellant–Defendant Otter Creek Trading Company is operated by Appellant–Defendant Daniel Pohle (collectively, “Defendants”) and manufactures and sells lead smelters. Appellee–Plaintiff PCM Enviro PTY, LTD (“PCM”), is an Australian company owned and operated by Craig Mitchell and his brother Paul that recycles lead shot collected from shooting clubs. In 2014, Craig, in his capacity as operator of PCM, arranged to purchase a smelter from Otter Creek and paid for it in full. Defendants, however, did not ship the smelter or another part (purchased separately and called a Broekema belt) that Defendants had offered to ship along with the smelter and which the defendant Pohle had retrieved from a shipping company in Edinburgh, Indiana.

[2] PCM sued Defendants for breach of contract and for conversion of the Broekema belt. Pohle, pro se, filed a letter with the trial court, alleging that Defendants had no signed contract with PCM and that he had never driven to Minnesota to collect the Broekema belt. After the trial court advised Defendants to secure legal representation, they did for a time but filed no further response to PCM's complaint. Eventually, the trial court entered default judgment against Defendants and held a hearing on damages. After the hearing, the trial court ordered a total of approximately $147,000.00 in damages, which included the price of the smelter, lost profits, the value of the Broekema belt, and punitive damages for conversion. Defendants appeal, contending that the trial court erred in entering default judgment, in denying their motions to correct error and for relief from judgment, and in calculating damages. Finding no error, we affirm.

Facts and Procedural History

[3] Otter Creek is an Indiana corporation operated by Pohle which manufactures and sells lead smelters to customers outside the United States. PCM is an Australian company owned and operated by Craig and his brother Paul that recycles lead shot collected from shooting clubs. In July of 2014, Craig, in his capacity as operator of PCM, arranged to purchase a smelter from Otter Creek and paid for it in full by July 31, 2014. Otter Creek, however, did not ship the smelter. At some point before deciding not to ship the smelter, Pohle told PCM that there would be room in the smelter packaging and invited PCM to ship other items to Otter Creek so that they could be shipped with the smelter. PCM desired to ship a part called a Broekema belt (purchased from a company in Minnesota) along with the smelter, and, to that end, Pohle retrieved PCM's Broekema belt from the freight company in Edinburgh, Indiana. At one point, Pohle refused to release the Broekema belt to a friend of Craig's who had driven from Wisconsin.

[4] On October 17, 2014, PCM filed its complaint against Defendants, alleging that they had breached the contract for the purchase of the smelter and that they had converted the Broekema belt:

COMPLAINT

Plaintiff, [PCM] complains of the Defendants ... and alleges and says:

I. PARTIES

1. [PCM] is now, and at all times mentioned in this complaint was, a corporation duly organized and existing under the laws of Australia, with their principal place of business located in Melbourne, Victoria, Australia.

2. [Pohle] is currently a resident of the County of Jennings, Indiana, and is president of [Otter Creek].

3. [Otter Creek] is now, and at all times mentioned in this complaint was, a corporation duly organized and existing under the laws of State of Indiana, with their principal place of business located in Jennings County, Indiana, and is engaged in and is transacting business as a company in Jennings County, Indiana.

II. COUNT I

BREACH OF CONTRACT

4. [Otter Creek], by its president, [Pohle], offered to manufacture and provide a three (3) ton gas fired lead smelter to PCM.

5. [PCM] accepted Defendant's offer on or about July 5, 2014, to have Defendant manufacture a three (3) ton gas fired lead smelter.

6. Plaintiff was to pay Defendant a total of $15,000.00 per the terms of the contract with half the amount due initially and the remaining half due upon completion of the smelter.

7. Plaintiff complied with the terms of the contract and made both payments representing $15,000.00 in total to Otter Creek via wire transfer.

8. On August 7, 2014, [Otter Creek] sent a letter signed by Pohle, as president, to PCM stating the three (3) ton gas fired lead smelter was completed, tested and that they were waiting on F.O.B. shipping instructions from PCM.

9. The August 7, 2014 letter also stated the $15,000.00 owed by PCM had been paid.

10. [Defendants] have refused to release or ship the smelter since this time even after shipping instructions were supplied and repeated demands by PCM.

11. Pohle falsely claims that PCM and [Craig] intend to steal his intellectual property by purchasing the smelter and copying it.

12. [Defendants] have refused to return the $15,000.00 they received to perform this contract to PCM.

13. [Defendants] have breached the contract with PCM by their failure to perform their obligations under the contract, specifically, releasing and delivering the smelter to PCM.

14. PCM has been materially damaged as a result of [Defendants'] intentional breach of contract.

III. COUNT II

CONVERSION

15. The allegations of rhetorical paragraphs four through fourteen are incorporated herein by reference.

16. PCM had contracted with a third party, Lead Us Reclaim, LLC, of Augusta, Wisconsin, to purchase a Broekema USA belt.

17. [Defendants] had agreed to ship the belt with the above-mentioned smelter to PCM.

18. On August 5, 2014, Pohle drove to Broekema USA and told them that he was picking up a belt to package with the lead smelter that was to be shipped to PCM.

19. The Broekema belt was released to Pohle and he signed a Conway Freight delivery receipt for the belt.

20. PCM had arranged for shipping for the lead smelter and belt on three separate occasions but Pohle refused to release the equipment and complete his performance of the contract.

21. The belt in Pohle's possession has never belonged to him and he has refused to return or release the belt after multiple demands by PCM and [Craig].

22. Pohle has intentionally converted the belt he was to ship with the smelter to PCM by keeping the belt for his own use and knowing he never ha[d] permission from PCM to retain the belt.

23. Plaintiff has suffered significant loss and damage due to the conversion of Plaintiff's Broekema belt and money by [Defendants].

24. Defendants through conversion and theft have deprived PCM of the entire value of the belt and equipment along with all profits past and future.

WHEREFORE, Plaintiff, PCM, demands judgment against the Defendants, in an amount adequate to fully and fairly compensate him for his damages, prejudgment interest, punitive and treble damages, attorney fees, the cost of this action, and for all other appropriate relief.

Appellant's App. pp. 23–25.

[5] On November 10, 2014, Defendants filed a letter with the trial court, which stated, in part,

a) At no time has Otter Creek Trading Co., Inc. nor Daniel L. Pohle ever entered into any signed agreement with any Corporation, Company, Resident or Citizen of the Country of Australia.

b) I, Daniel L. Pohle, did not travel to Minnesota where Broekema USA is located in reference to any belt.

Appellant's App. p. 26.

[6] On November 12, 2014, Defendants filed a discovery request with the trial court requesting PCM's articles of incorporation and Craig's international travel records, proof of residence, and address. On November 18, 2014, the trial court urged Defendants to seek the assistance of counsel. On November 26, 2014, Defendants filed a letter thanking the trial court and informing it that they would be retaining counsel and attempting to have the matter transferred to federal court. On December 18, 2014, counsel for Defendants filed an appearance and moved for a forty-five day extension of time within which to answer PCM's complaint, which motion the trial court granted. On December 29, 2014, counsel for Defendants withdrew his appearance. Defendants filed no further response to PCM's complaint within the forty-five-day extension period.

[7] On February 5, 2015, PCM moved for default judgment on the basis that Defendants had not filed an answer to its complaint. That day, the trial court entered default judgment in favor of PCM and ordered a hearing for the purpose of setting damages. On May 22, 2015, the trial court held a hearing on the issue of damages. On June 17, 2015, the trial court issued its judgment for damages, finding that PCM had suffered damages of $15,000 for money retained, $127,256.50 for lost profits, $1281.30 for money spent on the converted Broekema belt, and $3000.00 in punitive damages, totaling $146,537.80. That day, the trial court also denied Defendants' motion to dismiss PCM's complaint. On July 17, 2015, Defendants filed a motion to correct error and for relief from judgment, which the trial court denied.

[8] Defendants argue on appeal that (1) the trial court erred in entering default judgment against them because they adequately answered PCM's complaint, (2) the trial court abused its discretion in denying their motion to correct error and for relief from judgment, and (3) the trial court abused its discretion in determining PCM's damages. PCM responds that (1) the trial court properly entered default judgment in its favor because Defendants filed multiple letters with the trial court but never admitted or denied any of PCM's allegations, (2) the trial court did not abuse its discretion in denying De...