Stanley C. Kinkade and Sherry Kinkade v. Jason Silvey and Jennifer Silvey (mem. dec.) ( 2020 )

MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be
regarded as precedent or cited before any
court except for the purpose of establishing
the defense of res judicata, collateral FILED
estoppel, or the law of the case. Mar 18 2020, 9:59 am
CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court
ATTORNEY FOR APPELLANTS
Robert J. Palmer
May • Oberfell • Lorber
Mishawaka, Indiana
IN THE
COURT OF APPEALS OF INDIANA
Stanley C. Kinkade and Sherry March 18, 2020
Kinkade, Court of Appeals Case No.
Appellants-Plaintiffs, 19A-CC-2565
Appeal from the Madison Circuit
v. Court
The Honorable Andrew R.
Jason Silvey and Jennifer Silvey, Hopper, Judge
The Honorable Christopher A.
Appellees-Defendants.
Cage, Master Commissioner
Trial Court Cause No.
48C03-1601-CC-19
Bradford, Chief Judge.
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Case Summary
[1] Stanley and Sherry Kinkade (collectively, “Appellants”) purchased a trailer
from Jason and Jennifer Silvey (collectively, “Appellees”) during the early part
of 2015. At some point after completing the purchase, Appellants discovered
damage to the trailer, which they claim should have been disclosed by
Appellees at the time of the sale. In January of 2016, Appellants filed suit
against Appellees, alleging misrepresentation and breach of contract.
Following a bench trial, the trial court entered judgment in favor of Appellees.
Appellants challenge the trial court’s judgment, arguing that they proved their
claims against Appellees. Because we disagree, we affirm.
Facts and Procedural History 1
[2] The trial court’s presentation of the underlying facts provide as follows: In late
January/early February of 2015, Appellees sold a Coachman camper trailer to
Appellants. The trailer was approximately seven years old and was located in
the Dry Dock Campground in Huntington. Appellees cited their declining use
of the trailer as the reason behind their decision to sell it. Appellants sought to
purchase the trailer in order to spend more time with family “already located in
the campground.” Appellants’ App. Vol. II p. 17.
1
Appellants rely on the trial court’s factual findings in their statement outlining what they deem to be the
relevant facts. Given that the parties have not provided this court with a copy of the transcript of the July 31,
2019 bench trial, we will do the same.
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[3] Per campground rules, the sale of any trailer, which was sold and was to remain
at the campground, was required to be conducted through the campground
owner Kay Fetter as the go between. In that capacity, Fetter handled
communications and paperwork related to the transaction in exchange for a ten
percent commission. After learning of Appellees’ intent to sell the trailer, Fetter
inquired as to whether Appellees had noticed any leaks or other problems.
Jennifer Silvey replied that “everything works inside and there has [sic] been no
leaks.” Appellants’ App. Vol. II p. 17.
[4] Appellees last used the trailer in warmer weather and with all sides extended in
the Fall of 2014. Appellants went to the campground and viewed the trailer in
January of 2015. At the time, it was very cold and “no electricity was active to
the trailer.” Appellants’ App. Vol. II p. 18. Also at the time of the viewing,
Fetter conveyed Jennifer Silvey’s statement regarding the condition of the
trailer to Appellants and the record indicates that the floors of the trailer were
hard. Appellants walked around the entire trailer and did not notice any
damage or problems with Sherry Kinkade saying “everything looked good.”
Appellants’ App. Vol. II p. 18. Appellants did not, however, extend the slide
outs or ask that they be extended.
[5] After purchasing the trailer, Appellants next visited the trailer in either March
or April of 2015. On this visit, they extended the sides of the trailer and found a
large mushroom growing but did not notice any other problems apart from “a
mildew smell.” Appellants’ App. Vol. II p. 19. However, Appellants claim that
the next morning they discovered “a moldy smell” and “soft spots” in the floor
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under the carpeting. Appellants’ App. Vol. II p. 19. A week or so later, Fetter
inspected the trailer. She observed that the carpet and flooring felt soft but did
not notice any smell or odor. Appellants subsequently determined that they
were unable to use the trailer due to the damage.
[6] In January of 2016, Appellants filed suit against Appellees, alleging
misrepresentation and breach of contract. A bench trial was held on July 31,
2019, during which the parties offered competing expert testimony regarding
the cause of the damage. On August 26, 2019, the trial court entered judgment
in favor of Appellees. Appellants subsequently filed a motion to correct error,
which was denied by the trial court on October 5, 2019.
Discussion and Decision
[7] Initially, we note that Appellees have not filed an appellate brief.
“When the appellee has failed to submit an answer brief we need
not undertake the burden of developing an argument on the
appellee’s behalf.” Trinity Homes, LLC v. Fang, 848 N.E.2d 1065,
1068 (Ind. 2006). “Rather, we will reverse the trial court’s
judgment if the appellant’s brief presents a case of prima facie
error.” Id. (citing Gibson v. City of Indpls., 242 Ind. 447, 448, 179
N.E.2d 291, 292 (1962)). “Prima facie error in this context is
defined as, ‘at first sight, on first appearance, or on the face of
it.’” Id. (citing Santana v. Santana, 708 N.E.2d 886, 887 (Ind. Ct.
App. 1999)). “Where an appellant is unable to meet this burden,
we will affirm.” Id.
Fifth Third Bank v. PNC Bank, 885 N.E.2d 52, 54 (Ind. Ct. App. 2008).
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[8] Appellants indicate that the trial court’s factual findings and conclusions
thereon were entered sua sponte. In such cases, “‘the findings control our review
and the judgment only as to the issues those specific findings cover. Where
there are no specific findings, a general judgment standard applies and we may
affirm on any legal theory supported by the evidence adduced at trial.’” Estate
of Henry v. Woods, 77 N.E.3d 1200, 1204 (Ind. Ct. App. 2017) (quoting Samples
v. Wilson, 12 N.E.3d 946, 949–50 (Ind. Ct. App. 2014)).
We apply a two-tier standard of review to the sua sponte findings
and conclusions. [Samples, 12 N.E.3d] at 950. First, we
determine whether the evidence supports the findings and
second, whether the findings support the judgment. Id. We will
set aside findings and conclusions only if they are clearly
erroneous, that is, when the record contains no facts or inferences
supporting them. Id. In conducting our review, we consider only
the evidence favorable to the judgment and all reasonable
inferences flowing therefrom. Id. We do not reweigh the
evidence nor do we assess witness credibility. Id.
Id.
[9] Further, because Appellants did not prevail at trial, they appeal from a negative
judgment.
A judgment entered against a party who bore the burden of proof
at trial is a negative judgment. Garling v. Ind. Dep't of Natural Res.,
766 N.E.2d 409, 411 (Ind. Ct. App. 2002). On appeal, we will
not reverse a negative judgment unless it is contrary to law.
Mominee v. King, 629 N.E.2d 1280, 1282 (Ind. Ct. App. 1994).
To determine whether a judgment is contrary to law, we consider
the evidence in the light most favorable to the appellee, together
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with all the reasonable inferences to be drawn therefrom. J.W. v.
Hendricks Cnty. Office of Family & Children, 697 N.E.2d 480, 482
(Ind. Ct. App. 1998). A party appealing from a negative
judgment must show that the evidence points unerringly to a
conclusion different than that reached by the trial court.
Mominee, 629 N.E.2d at 1282.
Smith v. Dermatology Assocs. of Fort Wayne, P.C., 977 N.E.2d 1, 4 (Ind. Ct. App.
2012).
I. Misrepresentation
[10] Appellants contend that the trial court erred in finding that they failed to prove
their claim of misrepresentation. We note that while Appellants’ appellate brief
presents their misrepresentation claim as a claim of negligent misrepresentation,
both the trial court’s judgment and Appellants’ trial brief treat the
misrepresentation claim as one of fraudulent misrepresentation. Given that
Appellants and the trial court treated the misrepresentation claim as a claim of
fraudulent misrepresentation at the trial-court level, we will treat the claim as
such on appeal.
[11] [T]o establish a cause of action for fraudulent misrepresentation
Buyer must demonstrate: (1) Sellers made false statements of
past or existing material facts; (2) Sellers made such statements
knowing them to be false or made them recklessly without
knowledge as to their truth or falsity; (3) Sellers made the
statements to induce Buyer to act upon them; (4) Buyer
justifiably relied and acted upon the statements; and, (5) Buyer
suffered injury.
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Verrall v. Machura, 810 N.E.2d 1159, 1162 (Ind. Ct. App. 2004). In entering
judgment in favor of Appellees, the trial court determined that while Appellants
successfully proved the first, third, fourth, and fifth elements, Appellants failed
to prove the second element, i.e., that Appellees made the statements regarding
the condition of the trailer “knowing them to be false or made them recklessly
without knowledge as to their truth of falsity.” Id. Appellants assert that this
determination is clearly erroneous. We disagree.
[12] With respect to the second element, the trial court reached the following
conclusion:
Now turning to the second and dispositive element concerning
whether [Appellees’] statements were made by them knowing
them to be false or recklessly without knowledge as to their truth
or falsity. Put differently, it is not enough for [Appellants] to
establish that the leak had be going on for a long time prior to the
sale. They must prove that [Appellees] had actual knowledge or
should have had knowledge of the damage at the time of the
representations.
Based upon the record presented to the Court, it cannot conclude
that [Appellants] established by a preponderance standard; that
[Appellees] had actual knowledge of the structural problems with
the trailer at the time they sold the trailer to [Appellants]. There
was no evidence presented by [Appellants] to show that
[Appellees’] denials of any knowledge of leaks prior to the sale
was intentionally or recklessly made. Jason Silvey testified
emphatically that he never observed any evidence of any leaks;
nor repaired any stains or other damage by water. No evidence
of prior repairs, or prior damage was tendered. [Appellants’]
expert witness acknowledged that even if the damage had
occurred over a long period of time, the evidence of that damage
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can appear over a short period of time if the conditions are right.
Failing the establishment of actual knowledge, the burden of
proof was upon [Appellants] to alternatively establish that
[Appellees] should have known of the existence of leaks or
damage to the trailer; or that their statements were recklessly
made. The Court finds that [Appellants] did not present
sufficient direct or circumstantial evidence to meet this burden
concerning the pre-sale condition of the trailer. No eyewitnesses,
photographs, documentation ever were presented to prove to the
Court that [Appellees] had prior knowledge that the existence of
a leak or damage was present. Further, the only visible damage
other than the mushroom in the slide out was that damage [that]
was visible after the carpet was pulled up. There was no
evidence that [Appellees] ever had reason to pull up or replace
carpet or that the mushroom which was found growing, was
present at the time [Appellees’] closed the trailer for the fall of
2014.
The absence of evidence that [Appellees] knew or ought to have
known of the damage to the floor of the camper or the
mushroom is fatal to [Appellants’] ability to prevail under a
theory of fraud.
Appellants’ App. Vol. II pp. 22–23. Again, Appellants bore the burden to prove
that the evidence points “unerringly to a conclusion different than that reached
by the trial court.” Smith, 977 N.E.2d at 4. Appellants have failed to carry this
burden. As such, based on the limited record presented on appeal, we cannot
say that the trial court’s conclusions are clearly erroneous.
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II. Breach of Contract
[13] Appellants also contend that the trial court erred by failing to rule on their
breach-of-contract claim. Specifically, Appellants argue that their trial brief
“addressed only one of the two causes of action raised in their Complaint, i.e.
breach of contract.… Despite [Appellants’] focus on the breach of contract
claim, the trial court’s Judgement in favor of [Appellees] does not mention the
breach of contract claim.” Appellants’ Br. p. 12. Appellants’ trial brief,
however, did not address a breach-of-contract claim but rather included a
detailed discussion of a prior decision involving a breach-of-warranty claim.
Appellants’ App. Vol. II pp. 30–34 (discussing Art Hill, Inc. v. Heckler, 457
N.E.2d 242 (Ind. Ct. App. 1983)). We have previously noted that “[a]lthough
closely related, the two actions are not identical.” Nelson v. Marchand, 691
N.E.2d 1264, 1271 n.8 (Ind. Ct. App. 1998). As such, we cannot agree with
Appellants’ assertion that their trial brief addressed their breach-of-contract
claim.
[14] Further, as is noted above in footnote 1, the parties did not provide us with a
copy of the transcript of the bench trial. Thus, while Appellants’ complaint for
damages includes a breach-of-contract claim, we are unable to determine from
the record presented on appeal whether Appellants fully developed this claim
before the trial court. Without some indication from the record that Appellants
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did develop the breach-of-contract claim, we are unable to conclude that the
trial court erred by failing to include a ruling on this claim in its judgment. 2
[15] The judgment of the trial court is affirmed.
Robb, J., and Altice, J., concur.
2
Furthermore, we do not agree with Appellants’ assertion that the trial court’s factual findings “establish
[Appellees’] liability for breach of contract.” Appellants’ Br. p. 8.
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