State ex rel. Neese v. Montgomery Circuit Court

• Decision Date: 04 February 1980
• Docket Number: No. 879S227,879S227
• Citation: 399 N.E.2d 375,272 Ind. 495
• Parties: STATE of Indiana, on the relation of Jerry NEESE, Mrs. Jerry Neese, Earl William Neese, Neese Printing Co., d/b/a Mid-State Newspapers, Inc., M. Dale Palmer, and Harlan H. Hinkle, Relators, v. MONTGOMERY CIRCUIT COURT, Honorable Thomas K. Milligan, as Judge of the Montgomery Circuit Court, Respondents.
• Court: Indiana Supreme Court

Page 375

399 N.E.2d 375

272 Ind. 495

STATE of Indiana, on the relation of Jerry NEESE, Mrs. Jerry Neese, Earl William Neese, Neese Printing Co. d/b/a Mid-State Newspapers, Inc., M Dale Palmer, and Harlan H Hinkle, Relators, v. MONTGOMERY CIRCUIT COURT, Honorable Thomas K. Milligan, as Judge of the Montgomery Circuit Court, Respondents.

No. 879S227.

Supreme Court of Indiana.

Feb. 4, 1980.

Harlan H. Hinkle, Palmer, Hinkle, Keck & Webb, Danville, for relators.

Arthur N. Northrup, Martz, Beattey, Hinds & Wallace, Indianapolis, for respondents.

HUNTER, Justice.

This is an original action filed by relators following our denial of a temporary writ of mandate and prohibition. The issue raised by relators is whether or not in a suit for an accounting by a minority shareholder the trial court has authority to order an independent audit of the corporation's books after the trial but before a final judgment is rendered. We now find that the question presented is not a proper subject for an original action and therefore deny the application for a permanent writ.

This action began as a suit for an accounting brought by Don Richer, a minority shareholder in Mid-States Newspapers, Inc. (hereinafter called Mid-States), against Mid-States and Jerry Neese, Mrs. Jerry Neese and others who were on the Board of Directors of Mid-States. Richer alleged that the corporation had been mismanaged and that there had been falsification of records, misstatement of income, failure to pay dividends and conversion of the corporation's funds to the directors' personal use. The trial was held in Montgomery Circuit Court before The Honorable Thomas K. Milligan.

After completion of the presentation of the evidence, Judge Milligan took the matter under advisement and later filed an order for an audit of the corporation's books by an independent accounting firm. He found that there appeared to be significant discrepancies between the income actually received and what was reported on tax returns and financial reports. He found that because of the complex and confusing accounting principles used by the corporation it was necessary to have the report of an independent accounting firm in order to make sufficient findings of fact to determine the issues raised in the trial. Relators' objection to this order was denied.

Relators then brought the original action before this Court claiming that although the normal appellate process would be one way of reaching the issue, it would be costly and an extreme hardship for them to have to submit to the audit and then to appeal if the trial court's decision were to go against them. Relators now request this Court to order the respondents to refrain from any and all acts in connection with the ordering of the independent accounting.

We have often held that original actions are viewed with extreme disfavor by this Court. State ex rel. White v. Marion Sup. Ct., (1979) Ind., 391 N.E.2d 596; State ex rel. Sendak v. Marion Sup. Ct., (1978) Ind., 373 N.E.2d 145; State ex rel. Gibson General Hospital v. Warrick Cir. Ct., (1966) 247 Ind. 240, 214 N.E.2d 655. Writs of mandate and prohibition will be issued only where the trial court has an absolute duty to act or refrain from acting. State ex rel. Wm. H. Block Co. v. Sup. Ct. of Marion Cty., (1943) 221 Ind. 228, 47 N.E.2d 139. The extraordinary...