The Sullivan Corporation v. Rabco Enterprises LLC ( 2020 )

FILED
Dec 07 2020, 9:07 am
CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court
ATTORNEYS FOR APPELLANT ATTORNEY FOR APPELLEE
John J. Moore Joshua W. Casselman
Megan E. Cain Rubin & Levin, P.C.
Tuohy Bailey & Moore LLP Indianapolis, Indiana
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
The Sullivan Corporation, December 7, 2020
Appellant-Plaintiff, Court of Appeals Case No.
20A-PL-1444
v. Appeal from the Hamilton
Superior Court
Rabco Enterprises, LLC, The Honorable Jonathan M.
Appellee-Defendant. Brown, Judge
Trial Court Cause No.
29D02-1909-PL-8958
Bradford, Chief Judge.
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Case Summary
[1] The Sullivan Corporation (“Sullivan”) and Rabco Enterprises, LLC (“Rabco”)
entered into a contract for work relating to a construction project in Noblesville.
On September 24, 2019, Sullivan filed the underlying lawsuit, alleging that
Rabco had breached the parties’ contract. Rabco filed a motion to dismiss,
arguing that pursuant to the forum-selection clause in the parties’ contract, the
proper venue for Sullivan’s lawsuit was either the state or federal courts located
in Orange County, Florida. Sullivan appeals after the trial court granted
Rabco’s motion to dismiss. Concluding that the parties’ forum-selection clause
was void and unenforceable pursuant to Indiana Code section 32-28-3-17, we
reverse and remand the matter to the trial court for further proceedings.
Facts and Procedural History
[2] On August 29, 2017, Sullivan and Rabco entered into a written contract for
Rabco to provide labor and materials in connection with a construction project
known as “146th Street Self Storage” in Noblesville. Appellant’s App. Vol. II p.
13. Per the terms of the contract, Rabco agreed to provide timely plans for the
project, appropriate materials for the project, and appropriate equipment to
complete the work. In exchange, Sullivan agreed to pay Rabco the sum of
$1,143,940. The parties’ contract contained a forum-selection clause, which
read as follows:
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This contract shall be deemed to have been executed in and
performable in the state of Florida and shall be construed under
Florida law, without regard to said state’s conflicts of law rules
(except that the lien laws of the state in which the job site is
situated shall apply to the Rabco’s lien rights). It is agreed that
the exclusive venue for any litigation arising hereunder shall be in
the state or federal courts in Orange County, Florida.
Appellant’s App. Vol. II p. 22.
[3] On September 24, 2019, Sullivan filed the underlying lawsuit, alleging that
Rabco had breached the parties’ contract. Rabco subsequently moved to
dismiss the lawsuit “based on the forum-selection clause.” Appellant’s App.
Vol. II p. 39. In its reply, Sullivan argued that the forum-selection clause was
unenforceable pursuant to Indiana Code section 32-28-3-17. On July 8, 2020,
the trial court found that the forum-selection clause was valid and enforceable
and granted Rabco’s motion to dismiss.
Discussion and Decision
[4] This appeal centers around the question of whether the trial court erroneously
enforced the forum-selection clause found in the parties’ contract. Generally,
“[f]orum selection clauses—even those occurring in form contracts—are
enforceable if they are reasonable and just under the circumstances and there is
no evidence of fraud or overreaching such that the agreeing party would be
deprived of a day in court.” Adsit Co. v. Gustin, 874 N.E.2d 1018, 1022 (Ind. Ct.
App. 2007). However, Indiana Code section 32-28-3-17 provides: “[a]
provision in a contract for the improvement of real estate in Indiana is void if
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the provision: (1) makes the contract subject to the laws of another state; or (2)
requires litigation, arbitration, or other dispute resolution process on the
contract occur in another state.”
[5] In finding that the forum-selection clause was enforceable, the trial court found
that “there is no evidence of fraud or overreaching, nor are there any allegations
of such.” Appellant’s App. Vol. II p. 7. The trial court also determined that
because Indiana Code section 32-28-3-17 “is a part of Indiana’s statutes
governing mechanic’s liens,” Appellant’s App. Vol. II pp. 7–8, it would be
“inappropriate for the Plaintiff to utilize the mechanic lien statute as a sword to
achieve its own objective.” Appellant’s App. Vol. II p. 8. On appeal, Sullivan
argues that the trial court erred in determining that Indiana Code section 32-28-
3-17 applies only in the context of mechanics liens. Thus, at issue in this appeal
is the proper interpretation of Indiana Code section 32-28-3-17.
[6] In statutory construction, our primary goal is to ascertain and
give effect to the intent of the legislature. Gray v. D & G, Inc., 938
N.E.2d 256, 259 (Ind. Ct. App. 2010). The language of the
statute itself is the best evidence of legislative intent, and we must
give all words their plain and ordinary meaning unless otherwise
indicated by statute. Id. Furthermore, we presume that the
legislature intended statutory language to be applied in a logical
manner consistent with the statute’s underlying policies and
goals. Id. However, we will not interpret a statute which is clear
and unambiguous on its face; rather, we will give such a statute
its apparent and obvious meaning. Ind. State Bd. of Health v.
Journal–Gazette Co., 608 N.E.2d 989, 992 (Ind. Ct. App. 1993),
adopted, 619 N.E.2d 273 (Ind. 1993).
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U.S. Steel Corp. v. N. Ind. Pub. Serv. Co., 951 N.E.2d 542, 552 (Ind. Ct. App.
2011).
[7] Sullivan cites to the United States District Court for the Northern District of
Indiana’s unpublished decision in Pirson Contractors, Inc. v. Scheuerle
Fahrzeugfabrik GmbH, No. 2:07 CV 123, 2008 WL 927645 (N.D. Ind. Apr. 3,
2008), in support of its claim that Indiana Code section 32-28-3-17 should be
broadly applied to all cases involving the improvement of real estate. In that
case, the District Court determined that Indiana Code section 32-28-3-17
“speaks in broad terms that reach every contract for the improvement of real
estate, regardless of whether the party to the contract has, or could, assert a
mechanic’s lien.” Pirson Contractors, No. 2:07 CV 123, 2008 WL 927645, at *3.
The District Court rejected the defendant’s “attempts to read a requirement into
the statute that a party first assert a lien before this statute becomes operative by
virtue of its placement in this section of the Indiana Code alone” and held that
“there is no basis to require a plaintiff to first assert a mechanic’s lien as a
prerequisite to the enforcement of [Indiana Code section] 32-28-3-17.” Id.Based on this holding, the District Court refused to enforce the parties’ forum-
election and choice-of-law provisions. Id. While not binding, we find the
District Court’s decision to be persuasive.
[8] Furthermore, a reading of various sections that fall under Indiana Code chapter
32-28-3 reveals that the General Assembly had the ability and forethought to
use language limiting the various sections of Indiana Code chapter 32-28-3 to
the protection/enforcement of liens when the General Assembly intended that
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result. For example, both Indiana Code section 32-28-3-16 and Indiana Code
section 32-28-3-18 specifically reference liens. The General Assembly,
however, did not reference liens or use any language limiting application of the
statute to situations involving liens in codifying Indiana Code section 32-28-3-
17. The General Assembly could easily have included such limiting language
had that been its intent. See Ansert Mech. Contractors, Inc. v. Ansert, 690 N.E.2d
305, 308 (Ind. Ct. App. 1997) (“Had the legislature intended such a limitation,
it could have easily done so with slight modification to the wording of the
statute.”). Thus, one may reasonably infer that the General Assembly did not
intend to limit application of Indiana Code section 32-28-3-17 to situations
involving mechanics liens.
[9] Given that the General Assembly did not include language limiting the
application of Indiana Code section 32-28-3-17 to situations involving
mechanics liens, we conclude that the statute should be read broadly to apply to
all contracts for the improvement of real estate in Indiana. As such, we further
conclude that the trial court erred in finding both that Indiana Code section 32-
28-3-17 did not apply to the parties’ contract and that the forum-selection clause
was valid and enforceable.
[10] The judgment of the trial court is reversed, and the matter remanded for further
proceedings.
Kirsch, J., and May, J., concur.
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