author: Massa, Justice.

text:
    STATE of Indiana and Indiana Bureau of Motor Vehicles, Appellants (Respondents below) v. Daniel REINHART, Appellee (Petitioner below)
    Supreme Court Case No. 18S-MI-286
    Supreme Court of Indiana.
    Argued: June 19, 2018 FILED December 5, 2018
    ATTORNEYS FOR APPELLANTS: Curtis T. Hill, Jr., Attorney General of Indiana, Aaron T. Craft, Andrea Rahman, Deputy Attorneys General, Indianapolis, Indiana
    ATTORNEY FOR APPELLEE: Brian J. Johnson, Danville, Indiana
    On Petition to Transfer from the Indiana Court of Appeals, No. 01A02-1709-MI-2049
   Massa, Justice.

The proper venue for seeking specialized driving privileges depends on whether the petitioner's underlying suspension was court ordered or whether it was imposed administratively by the BMV. The latter suspension type requires the petitioner to seek relief in his or her county of residence; the former requires the petitioner to file in each court that ordered a suspension.

But where is the proper venue for seeking relief when that person "forfeits" driving privileges for life following a felony conviction for driving while suspended? Because we consider this lifetime forfeiture an administrative suspension, we hold the proper venue is the trial court in a person's county of residence. We thus affirm the trial court's order granting Reinhart's petition for specialized driving privileges.

Facts and Procedural History

Daniel Reinhart, a resident of Adams County, is subject to three separate driver's license suspensions. The BMV imposed two of these suspensions, in 2012 and 2015, for habitual traffic violations in Adams County. The third suspension is a lifetime forfeiture resulting from a 2015 felony conviction in Noble County for driving while suspended as a habitual traffic violator. See Ind. Code § 9-30-10-16 (2014) (Section 16).

In 2017, Reinhart petitioned the Adams Superior Court for specialized driving privileges (SDP), seeking relief from all three suspensions under Indiana Code section 9-30-16-4 (Section 4). Section 4 requires drivers suspended by administrative action of the BMV to petition the court of his or her county of residence. I.C. § 9-30-16-4(d)(1) (2016). But for court-ordered license suspensions, Indiana Code section 9-30-16-3 (Section 3) requires the suspended driver to petition "each court that has ordered or imposed a suspension of the individual's driving privileges." I.C. § 9-30-16-3(b) (2016) (we refer to Sections 3 and 4 collectively as the SDP Statute).

The Adams Superior Court granted Reinhart's SDP petition, despite the State's questioning of its jurisdiction over the "sentence" imposed by the Noble Superior Court. Tr., p.12. The SDP order stayed all three suspensions for two years, allowing Reinhart to drive to and from work, to visit his children, and to other limited locations (for example, to buy groceries or attend medical appointments) at specified times. The State moved to correct error, arguing that the Adams Superior Court lacked jurisdiction to stay or modify the lifetime forfeiture imposed by the Noble Superior Court. The Adams Superior Court disagreed, characterizing the lifetime forfeiture as an administrative suspension over which it properly exercised jurisdiction.

Our Court of Appeals reversed and remanded, instructing the trial court to "vacate that portion of its order related to Reinhart's Noble County suspension." State v. Reinhart , 93 N.E.3d 801, 803 (Ind. Ct. App. 2018), vacated . The panel held that the Noble Superior Court ordered Reinhart's lifetime forfeiture, thus requiring him to petition that court separately for SDP. Id. "The fact that the Noble County court was required to suspend his privileges for life does not transform the suspension," the panel explained, "which was part of a criminal sentencing order, into an administrative suspension." Id. The panel also held, contrary to precedent, that the "Adams County trial court lacked jurisdiction to modify the Noble County order" since "one court cannot modify or change the record of another court of equal jurisdiction." Id. ; contra Prosecuting Attorney of Hendricks Cty. v. Hammer , 92 N.E.3d 649, 652 (Ind. Ct. App. 2017) (holding that a trial court "has subject matter jurisdiction to adjudicate petitions for specialized driving privileges" when the underlying suspension resulted upon conviction in another trial court).

Although our General Assembly has since amended Section 16 to remove the lifetime license forfeiture, see Pub. L. No. 188-2015, § 117, 2015 Ind. Acts 2248, 2318-19, we granted transfer to resolve the conflict in our Court of Appeals precedent and to provide a path forward for those in Reinhart's position.

Standard of Review

We typically review a trial court's ruling on a motion to correct error for an abuse of discretion. Becker v. State , 992 N.E.2d 697, 700 (Ind. 2013). But when that motion rests on an issue of statutory construction, as it does here, we review the trial court's ruling de novo. Id. Questions of subject-matter jurisdiction fall under the same standard of review. In re Adoption of J.T.D. , 21 N.E.3d 824, 827 (Ind. 2014).

Discussion and Decision

In 1929, the Indiana General Assembly adopted the state's first law governing the licensing of drivers. See Act of Mar. 13, 1929, ch. 162, 1929 Ind. Acts 499. Among other things, the measure set forth licensing application and renewal procedures, established certain standards for driving competency, and outlined the grounds for the suspension of driving privileges. Id. §§ 5, 7-9, 14, 15-17, 1929 Ind. Acts at 501-04, 506, 507-09. The statute also made it a misdemeanor offense for a person to drive with a "suspended or revoked" license. Id. § 26, 1929 Ind. Acts at 511.

The modern incarnation of this offense-codified in 1972 by the Habitual Traffic Offender Act-is part of a larger legislative scheme imposing increasingly serious sanctions on a person it defines as a habitual traffic violator (or HTV). See Pub. L. No. 81-1972, § 1, 1972 Ind. Acts 510, 510-17 (codified as amended at I.C. ch. 9-30-10). Within this statutory framework (which we refer to as the HTV Law), a habitual traffic violator faces the suspension of driving privileges for up to ten years, depending on the nature and number of the offenses committed over a ten-year period. See I.C. §§ 9-30-10-4, -5. Those caught driving while suspended face felony convictions and, under some circumstances, the potential suspension of driving privileges for life. See I.C. §§ 9-30-10-16, -17.

But in recognizing the critical role automobiles play in people's lives, the legislature has long offered relief-albeit limited-to those suspended drivers who can demonstrate hardship. Before 2015, suspended drivers could petition for a "restricted" driving permit "for the sole and exclusive purpose of driving to and from work" if the suspension "would work an undue hardship" on the individual's "family and dependents." I.C. § 9-5-2-1 (1976) (recodified at I.C. § 9-24-15-2 (1993) (repealed 2015) ) (emphasis added). See also Gibson v. Hernandez , 764 N.E.2d 253, 256 (Ind. Ct. App. 2002) (holding that "the statute does not permit a trial court to grant a restricted driving permit for the transportation of children to and from school and doctor's appointments even in emergencies"), trans. denied.

The SDP Statute's passage in 2014 expanded the relief available to those with driver's license suspensions. See Pub. L. No. 217-2014, § 154, 2014 Ind. Acts 2675, 2759-61 (codified as amended at I.C. ch. 9-30-16). Unlike its predecessor statute, the SDP Statute contains no express limitations on the type of relief a petitioner may seek. Instead, the SDP Statute permits the trial court to define the "terms of specialized driving privileges" at its discretion. I.C. § 9-30-16-3(d). And, with certain exceptions, these privileges apply for up to two and a half years, "regardless of the underlying offense." I.C. § 9-30-16-3(c).

To secure relief, a petitioner for SDP must follow specific pleading requirements. See I.C. §§ 9-30-16-3(b) (listing conditions for form, filing, and service of process); 9-30-16-4(b) (same). And the proper venue in which to file depends on whether the petitioner's underlying suspension was court ordered or imposed by the BMV. The latter suspension type requires the petitioner to file in his or her county of residence, while the former type requires the petitioner to file in each court that ordered a suspension. I.C. §§ 9-30-16-3(b) ; 9-30-16-4(d)(1).

Here, the parties agree that Reinhart properly petitioned the Adams Superior Court for the two HTV suspensions imposed by the BMV in 2012 and 2015. The dispute centers instead on the proper venue for seeking relief from the lifetime forfeiture of driving privileges resulting from Reinhart's 2015 felony conviction in Noble County. Resolution of this dispute turns on whether the lifetime license forfeiture imposed under Section 16 constitutes an administrative or court-ordered suspension, as those terms apply to the SDP Statute.

Section 16 makes it a Level 6 felony for a person who knowingly drives with a suspended license. I.C. § 9-30-10-16(a). But at the time of Reinhart's conviction, Section 16 added that,

[i]n addition to any criminal penalty, a person who is convicted of a felony under subsection (a) forfeits the privilege of operating a motor vehicle for life . However, if judgment for conviction of a Class A misdemeanor is entered for an offense under subsection (a), the court may order a period of suspension of the convicted person's driving privileges that is in addition to any suspension of driving privileges already imposed upon the person.

I.C. § 9-30-10-16(c) (emphasis added) (repealed 2015).

Whether the lifetime forfeiture of driving privileges is administrative or court ordered is a question of statutory interpretation. "The goal of statutory interpretation is to discern and further the intent of the legislature." West v. Office of Indiana Sec'y of State , 54 N.E.3d 349, 353 (Ind. 2016). To that end, we look to the statute's plain language, "giving its words their ordinary meaning and considering the structure of the statute as a whole." Id. "And when confronted with more than one statute on the same subject, we must try to harmonize any inconsistencies." Id. By legislative mandate, courts must, in deciding traffic-offense cases, construe the general penalty provisions of the Motor Vehicle Code "to secure simplicity and uniformity in procedure, fairness in administration, and the elimination of unjustifiable expense and delay." I.C. § 9-30-3-1.

I. Sections 3 and 4 designate venue rather than confer jurisdiction.

We must first decide whether, under Indiana Code chapter 9-30-16, a trial court in one county has subject-matter jurisdiction to adjudicate an SDP petition when an underlying suspension resulted upon conviction by a trial court in another county.

Subject-matter jurisdiction is the constitutional or statutory power of a court "to hear and determine cases of the general class to which any particular proceeding belongs." K.S. v. State , 849 N.E.2d 538, 540 (Ind. 2006). So, in determining whether a court has subject-matter jurisdiction, the only relevant inquiry is whether the petitioner's claim "falls within the general scope of the authority conferred upon such court by the constitution or by statute." State ex rel. Young v. Noble Circuit Court , 263 Ind. 353, 356, 332 N.E.2d 99, 101 (1975).

Here, the Adams Superior Court, as with all Superior Courts in Indiana, exercises "original and concurrent jurisdiction in all civil cases and in all criminal cases." See I.C. § 33-29-1-1.5. And the SDP Statute neither restricts a court's subject-matter jurisdiction nor confers it exclusively to a particular court. The statute instead simply prescribes venue, "the location at which trial proceedings are to occur from among the courts empowered to exercise jurisdiction." J.T.D. , 21 N.E.3d at 829 (internal quotation marks omitted). See also Ind. Trial Rule 75(D) ("No statute or rule fixing the place of trial shall be deemed a requirement of jurisdiction.").

This "special procedure" controls "the exercise of the judicial function." State ex rel. Root v. Circuit Court of Allen Cty. , 259 Ind. 500, 505-06, 289 N.E.2d 503, 507 (1972) (discussing the pleading and venue requirements under the former statute governing restricted driving permits). But procedural error doesn't rob the court of jurisdiction. K.S. , 849 N.E.2d at 541. See also Hammer , 92 N.E.3d at 652 (whether a suspended driver petitions the proper court under the SDP statute is a "question of legal error, not jurisdictional error"). Failure to transfer the SDP petition to the proper court under Trial Rule 75(B), upon timely objection, simply renders the court's final judgment voidable and thus subject to appeal. In re Chapman , 466 N.E.2d 777, 779 (Ind. Ct. App. 1984), trans. denied.

In concluding that the SDP Statute establishes venue requirements, we reject the State's argument that the Adams Superior Court lacked subject-matter jurisdiction to stay the lifetime license forfeiture imposed by the Noble Superior Court.

II. Absent a conviction modification, a lifetime license forfeiture under Section 16 is an administrative suspension.

Reinhart argues that a lifetime license forfeiture is an administrative suspension subject to Section 4. Upon his felony conviction, he insists, the forfeiture resulted by operation of law. The State counters that a lifetime forfeiture is a court-ordered suspension subject to Section 3 because "only a court may impose criminal punishment on someone convicted of a felony." Appellant's Br. at 15. Without the court's judgment of conviction, the State contends, the "BMV did not have the authority to suspend Reinhart's license under Indiana Code section 9-30-10-16," and "any attempt to allow the BMV to impose criminal punishment would violate the separation of powers doctrine." Id. at 15-16; Resp. to Trans. at 12.

A. As a collateral consequence of conviction, the lifetime license forfeiture is an administrative suspension.

We agree with the State that only trial courts may impose criminal judgments. Indeed, the "penal consequences of a guilty finding are triggered only by the entry of a judgment of conviction." Gardiner v. State , 928 N.E.2d 194, 197 (Ind. 2010). See also I.C. § 35-50-1-1 ("The court shall fix the penalty of and sentence a person convicted of an offense."). But the "required forfeiture of a defendant's driver's license [is] a collateral consequence of a guilty plea" and conviction, "not [a] punishment imposed by the court." Stoltz v. State , 657 N.E.2d 188, 192 (Ind. Ct. App. 1995) (internal quotation marks omitted).

A sanction is a criminal punishment when its purpose is punitive rather than remedial. Moala v. State , 969 N.E.2d 1061, 1066 (Ind. Ct. App. 2012). A collateral consequence, by contrast, is a civil penalty or disability imposed either by operation of law at the time of conviction or because of a subsequent, separate proceeding by a court or administrative agency. Am. Bar Ass'n, Crim. Just. Standards on Collateral Sanctions and Discretionary Disqualification of Convicted Persons 7 n.2 (3d ed. 2004). These consequences may apply indefinitely or for a limited period and may include, for example, deportation, loss of the right to vote, restrictions on firearm possession, and ineligibility for certain government assistance programs. Id. at 7; Hitch v. State , 51 N.E.3d 216, 227-28 (Ind. 2016) (Massa, J., concurring in result).

Some collateral consequences impose onerous, long-lasting burdens on an individual. See, e.g. , In re Matter of S.D. , 2 N.E.3d 1283, 1290 (Ind. 2014) (discussing the "harmful," long-term implications of a CHINS finding on a parent). Other collateral consequences serve important public interests. See, e.g. , Kirby v. State , 95 N.E.3d 518, 519 (Ind. 2018) (statute barring a "serious sex offender" from entering school property is a collateral consequence of criminal conviction). A driver's license suspension falls under this latter category.

The General Assembly enacted the HTV Law "to reduce the number of motor vehicle accidents in this state and to provide greater safety to the motoring public by denying to habitual traffic offenders the privilege of operating a motor vehicle." Pub. L. No. 81-1972, § 1, 1972 Ind. Acts at 510. In reiterating this purpose, this Court explained that "the deprivation of the license to drive" by operation of law "is not a punishment as a result of a criminal proceeding, but is rather an exercise of the police power for the protection of the public." State ex rel. Van Natta v. Rising , 262 Ind. 33, 36, 310 N.E.2d 873, 875 (1974).

Although the HTV Law no longer includes an express purpose, our Court of Appeals has consistently interpreted a driver's license suspension, "[w]hether it be for life or for a more limited time," as a remedial or regulatory measure. Hazelwood v. State , 3 N.E.3d 39, 43 (Ind. Ct. App. 2014) ; see also Indiana Bureau of Motor Vehicles v. McNeil , 931 N.E.2d 897, 902 (Ind. Ct. App. 2010) (asserting that the purpose of the sanction is "not to impose punishment" but rather "to remove from the highway those drivers who have proven themselves to be unfit to drive, and who pose a substantial threat to the safety of others") (internal quotation marks omitted), trans. denied.

To be sure, Section 16 defines a criminal offense. I.C. § 35-52-9-53 (" IC 9-30-10-16 defines a crime concerning habitual violator of traffic laws."). And a trial court may impose additional penalties on a person convicted of a driving offense. See I.C. § 9-30-16-1 (permitting a court to "suspend the driving privileges of a person convicted of [certain] offenses [involving the use of a motor vehicle] for a period up to the maximum allowable period of incarceration under the penalty"). But the HTV Law as a whole-of which Section 16 forms a part-embodies a larger "administrative suspension scheme" in which driving privileges "may be withheld, suspended or revoked by the State for reasons involving public safety." Schrefler v. State , 660 N.E.2d 585, 587-88 (Ind. Ct. App. 1996) (citing Ruge v. Kovach , 467 N.E.2d 673, 677 (Ind. 1984) (holding that the license suspension procedure under the former implied-consent statute was civil in nature) ). And although the loss of driving privileges "has some punitive impact on the offender, and may be implemented as a part of sentencing upon criminal conviction," this loss "is merely incidental to the overriding remedial purpose of the statute." Id. at 588 (emphasis added).

This conclusion tracks the opening sentence of subsection 16(c), which clearly signals that a lifetime license forfeiture is separate from "any criminal penalty" the trial court may impose. I.C. § 9-30-10-16(c). Nothing in that sentence requires judicial action; the felony conviction itself triggers the non-discretionary penalty. See Pillow v. State , 986 N.E.2d 343, 345 (Ind. Ct. App. 2013) (holding that Section 16's lifetime license forfeiture applied even though neither the trial court's sentencing order nor the defendant's BMV record showed the forfeiture). The trial court merely performs the ministerial task of notifying the BMV of the conviction through the appropriate administrative form. The BMV, in turn, by express statutory authority, then implements the suspension. See I.C. § 9-14-8-3(3) (vesting authority in the BMV to suspend or revoke the "current driving privileges or driver's license of any individual" upon "any reasonable ground appearing on [the BMV's] records").

Our conclusion here also harmonizes with the legislative mandate of Indiana Code section 9-30-10-17. See Klotz v. Hoyt , 900 N.E.2d 1, 5 (Ind. 2009) (an appellate court will construe statutes relating to the same subject matter to produce a harmonious statutory scheme). That statute makes it a Level 5 felony for a person who drives with a suspended license and causes serious bodily injury or death, or who drives with a lifetime license forfeiture following a conviction under Section 16. I.C. § 9-30-10-17(a). If the offense results in death, "the bureau shall suspend the person's driving privileges for the life of the person." I.C. § 9-30-10-17(b) (emphasis added).

Finally, interpreting Section 16's lifetime forfeiture as an administrative suspension comports with the legislative mandate that courts construe traffic-offense statutes "to secure simplicity and uniformity in procedure" and to further "the elimination of unjustifiable expense and delay." I.C. § 9-30-3-1. The State's reading of the statute, by contrast, would require individuals to petition each court from which a lifetime forfeiture arose, increasing exponentially the number of SDP petitions filed and adding to the already-congested dockets of our trial courts.

B. A conviction modification under Section 16 results in a court-ordered suspension.

Unlike the opening sentence of subsection 16(c), its second sentence expressly vests discretionary authority in the trial court to "order a period of suspension" when "judgment for conviction of a Class A misdemeanor is entered for an offense under subsection (a)." I.C. § 9-30-10-16(c) (emphasis added). This second sentence implicates two criminal statutes governing the conversion of Level 6 felonies to Class A misdemeanors: Indiana Code sections 35-50-2-7 and 35-38-1-1.5. The former statute permits a trial court to modify the conviction at the time it delivers its sentence. I.C. § 35-50-2-7(c) (2014) ; State v. Brunner , 947 N.E.2d 411, 416 (Ind. 2011). The latter statute contains no time restrictions on the conviction modification but requires the defendant to fulfill "certain conditions," to which the court and the prosecuting attorney must agree. I.C. § 35-38-1-1.5(a) - (b) (2014). Under either statutory mechanism, "the entry of judgment of conviction upon the misdemeanor offense constitutes a new and different judgment effectively vacating the prior judgment." Gardiner , 928 N.E.2d at 197.

Given this context, we conclude that the second sentence of subsection 16(c), when exercised at the trial court's discretion, transforms an administrative forfeiture into a court-ordered suspension. See State v. Vankirk , 955 N.E.2d 765, 769 (Ind. Ct. App. 2001) (holding that a trial court's entry of judgment of conviction for a Class A misdemeanor for an offense under Section 16 removes the lifetime license forfeiture), trans. denied . This conclusion fits logically with Section 3's venue requirement that a suspended driver seek relief from the court (or courts) that modified the suspended driver's conviction. As Reinhart notes, the "duration of the suspension" imposed by the court depends "on the facts of that particular case, including the nature and severity of the offense, as well as the character of the defendant." Appellee's Pet. to Trans. at 22. A non-discretionary lifetime forfeiture, on the other hand, depends simply on the defendant's HTV status, not the specific facts of the case or the agreed-upon conditions he must fulfill to reduce the sentence.

In sum, we hold that, under Section 16, a conviction modification from a Level 6 felony to a Class A misdemeanor results in a court-ordered suspension. But with no conviction modification, a lifetime license forfeiture constitutes an administrative suspension for purposes of the SDP Statute.

Conclusion

Today, an estimated 420,000 Hoosiers navigate their daily lives with suspended driving privileges. Ryan T. Schwier & Autumn James, Indiana University McKinney School of Law, Roadblock to Economic Independence: How Driver's License Suspension Policies in Indiana Impede Self-Sufficiency, Burden State Government & Tax Public Resources 6 (2016), available at https://mckinneylaw.iu.edu/practice/clinics/_docs/DL_Rpt_2-1-16.pdf. With few alternative forms of transportation, many of these individuals face significant barriers to maintaining employment and supporting their families, an outcome that effectively discourages economic independence. Id. at 35. To be sure, Indiana's traffic laws play a critical role in keeping the roads safe for drivers in the state. And those who violate these laws must be held accountable. But when the legislature has offered an avenue of relief to those who can demonstrate hardship, and when a court determines that they no longer threaten public safety, we see no reason to impose additional roadblocks.

For the reasons specified above, we affirm the trial court's order granting Reinhart's petition for relief from all three suspensions under Indiana Code section 9-30-16-4.

Rush, C.J., and David, Slaughter, and Goff, JJ., concur.

      "A person whose driving privileges are suspended or forfeited for a determined period or for life under this chapter is eligible for specialized driving privileges." Ind. Code § 9-30-10-19 (2017).

      The Habitual Traffic Offender Act has manifested itself in various places in the Motor Vehicle Code over the years. First codified at Indiana Code chapter 9-4-13, the Act became Indiana Code article 9-12 in 1984 under the heading of Habitual Violator of Traffic Laws. See Pub. L. No. 79-1984, §§ 1, 2, 1984 Ind. Acts 959, 959-66. And in 1991, the legislature recodified the law at Indiana Code chapter 9-30-10, where it remains today under virtually the same heading. See Pub. L. No. 2-1991, §§ 18, 109, 1991 Ind. Acts 191, 655-65, 736.

      The other principal avenue of relief, Indiana Code section 9-30-10-14.1, permits a person, under certain conditions and after a specified number of years, to petition a court for a rescission of a lifetime suspension. I.C. § 9-30-10-14.1 (2016).

      Comparatively, for example, a "juvenile court has exclusive original jurisdiction" over cases involving delinquent children or children in need of services. I.C. § 31-30-1-1.

      Indiana Code section 9-30-10-14.1 similarly designates venue by requiring a person to petition a court in his or her county of residence "for a rescission of [a lifetime] suspension order and reinstatement of driving privileges." I.C. § 9-30-10-14.1(b) -(c), (f).

      Trial Rule 75(D) also renders "ineffective" those statutes imposing "more stringent" venue requirements. See also I.C. § 34-8-1-3 ("[A]ll laws in conflict with the supreme court's rules [governing practice and procedure] have no further force or effect."). But because the issue is not dispositive here, we need not decide whether the SDP Statute's venue requirements conflict with this rule.

      A statute is "remedial" if it serves to "enforce rights or redress injuries" or to correct a defect in the law. Black's Law Dictionary 1634 (10th ed. 2014).

      The certified abstract of court record used here, commonly referred to as the SR16, is the form used by trial courts to notify the BMV of "the conviction of a person in the court for a violation of a law relating to motor vehicles." I.C. § 9-30-13-0.5(a) (2015). The abstract itself "must be in the form prescribed by the [BMV]." I.C. § 9-30-13-0.5(e).

      While the "entry of a judgment of conviction under this section does not affect the application of any statute requiring the suspension of a person's driving privileges," I.C. § 35-38-1-1.5(e) (emphasis added), the section does not prohibit a modification of a defendant's driving privileges from a lifetime forfeiture , State v. Vankirk , 955 N.E.2d 765, 768 (Ind. Ct. App. 2011) (observing the "significant difference" in consequences between the two sanctions and noting the statute's silence as to the latter), trans. denied .

      We note that, at the hearing on the State's motion to correct error, counsel for the BMV acknowledged repeatedly that a lifetime forfeiture is "an administrative suspension mandatorily imposed by state law upon conviction" under Section 16, "regardless of what the judge does" and "whether or not the judge makes reference to it in his order." Tr., p.24.


source: Caselaw Access Project

author: Bradford, Judge.

license: Public Domain

text:
    RAINBOW REALTY GROUP, INC., and/or Cress Trust, Appellants/Cross-Appellees/Plaintiffs, v. Katrina CARTER and Quentin Lintner, Appellees/Cross-Appellants/Defendants.
    Court of Appeals Case No. 49A02-1707-CC-1473
    Court of Appeals of Indiana.
    FILED September 27, 2018
    Attorneys for Appellants: Karl L. Mulvaney, Nana Quay-Smith, Bingham Greenebaum Doll LLP, Indianapolis, Indiana
    Attorneys for Appellees: John E. Brengle, Indiana Legal Services, Inc., New Albany, Indiana, Jon Laramore, Cheryl Koch-Martinez, Adam Mueller, Indiana Legal Services, Inc., Indianapolis, Indiana
    Attorneys for Amicus Curiae State of Indiana: Curtis T. Hill, Jr., Attorney General of Indiana, Thomas M. Fisher, Solicitor General of Indiana, Indianapolis, Indiana, Justin G. Hazlett, Section Chief, Consumer Litigation, Indianapolis, Indiana, Steven P. Frank, Michelle Alyea, Amanda Lee, Julia C. Payne, Deputy Attorneys General, Indianapolis, Indiana
    Attorneys for Amicus Curiae Consolidated City of Indianapolis and Marion County: Maggie L. Smith, Darren A. Craig, Frost Brown Todd LLC, Indianapolis, Indiana, Donald E. Morgan, Office of Corporation Counsel, Indianapolis, Indiana
    Attorneys for Amicus Curiae Indiana Association for Community Economic Development Inc. d/b/a Prosperity Indiana: Maggie L. Smith, Darren A. Craig, Frost Brown Todd LLC, Indianapolis, Indiana
    Attorneys for Amicus Curiae Neighborhood Christian Legal Clinic: Maggie L. Smith, Darren A. Craig, Frost Brown Todd LLC, Indianapolis, Indiana, Chase M. Haller, Neighborhood Christian Legal Clinic, Indianapolis, Indiana
    Attorney for Amici Curiae Economic Justice Project of Notre Dame Clinical Law Center and National Consumer Law Center: Judith Fox, Notre Dame Clinical Law Center, South Bend, Indiana
   Bradford, Judge.

Case Summary

[1] In May of 2013, Appellees-Defendants Katrina Carter and Quentin Lintner (collectively, "the Lintners") signed a contract with Appellants-Plaintiffs Rainbow Realty Group, Inc., and/or Cress Trust (collectively, "Rainbow") styled as a rent-to-buy contract ("the Agreement") for an uninhabitable house in Indianapolis ("the Property"). The Agreement provided that the Lintners were purchasing the house, were responsible for all repairs, could retain all profits if they sold the house for more than their contractual payoff, would be subject to eviction if they defaulted, and would have their payments applied to the purchase price if timely made for two years. The Agreement did not require that it would end with a reversion of the Property to Rainbow.

[2] Almost from the beginning, the Lintners failed to make consistent payments pursuant to the Agreement, and, in June of 2015, Rainbow filed suit to terminate it, seeking immediate possession, damages, and attorney's fees. The Lintners moved for partial summary judgment on the basis that the Agreement was actually a lease and that Rainbow had violated Indiana's warranty of habitability that applies to residential leases pursuant to Indiana Code article 32-31, chapters 3 through 9 ("the Landlord-Tenant Act"). The trial court entered summary judgment in the Lintners' favor on the question of whether Rainbow had violated provisions of the Landlord-Tenant Act. Following a trial on remaining issues, the trial court entered judgment in favor of the Lintners, awarding them $4000 for what it concluded were Rainbow's fraudulently deceptive statements as well as $3000 in attorney's fees. Rainbow contends that the trial court erred in concluding that the Agreement was actually a lease and that it committed fraud by misrepresenting its true character to them. The Lintners contend that the trial court's judgment was correct but that its award of $3000 in attorney's fees (when approximately $35,000 was requested) constituted an abuse of discretion.

[3] We conclude that the Agreement is not a lease subject to the Landlord-Tenant Act. We do so pursuant to a long line of Indiana precedent requiring all leases to have a definite term and a reversion to the lessor, provisions the Agreement lacks. Our conclusion leads to the further conclusion that there is no basis on which to find that Rainbow committed fraud as a matter of law. Finally, because the Lintners did not prevail in the trial court, they are not entitled to recover any of their attorney's fees. We reverse and remand with instructions to enter judgment in favor of Rainbow on their claim for eviction and immediate possession of the Property. We also vacate the trial court's judgment that Rainbow committed fraud and its award of attorney's fees to the Lintners.

Facts and Procedural History

[4] Rainbow was founded in 1974 by James Hotka and buys and sells homes in inner-city Indianapolis. Rainbow buys vacant, abandoned, or distressed homes in need of rehabilitation and sells or leases them through various programs to interested parties. Rainbow sells structures that have not yet been renovated to purchasers, primarily through its rent-to-buy program, which it began in 1992.

[5] On April 24, 2013, Carter called Rainbow to inquire about home ownership through the rent-to-buy program. On April 30, 2013, the Lintners returned to Rainbow's office to fill out their application after choosing the Property, located at 910 North Oakland Avenue in Indianapolis. When the Lintners arrived, they were given a document which listed the homes available on that date, including the Property. The document given to the Lintners stated, in part:

THE SELLER(S) OF THE ABOVE PROPERTY HAVE NEVER LIVED IN THIS PROPERTY. THE PROPERTY, INCLUDING THE CONTENTS (IF ANY) ARE BEING SOLD "AS-IS" IN THEIR PRESENT CONDITION. THE SELLER(S) NOR RAINBOW REALTY GROUP INC. MAKE NO WARRANTIES NOR GUARANTIES AS TO THE CONDITION, HABITABILITY AND/OR LAWFUL ZONING USE OF THE PROPERTY.

Plaintiffs' Ex. 2.

[6] The Lintners completed an application to purchase the Property and put $100 down to hold it. Another document given to the Lintners provided that they would pay $449 when they signed the Agreement (the first month's payment minus the $100 deposit), and that their regular monthly payments thereafter would be $549. Carter signed this document, and placed her initials beside the paragraph which stated, "I HEREBY ACKNOWLEDGE AND UNDERSTAND THAT ALL PROPERTIES ARE BEING SOLD AS-IS WITHOUT ANY WARRANTY OF HABITABILITY." Plaintiffs' Ex. 6.

[7] After they were approved, the Lintners returned to Rainbow's office on May 3, 2013, to sign the Agreement, which provided, in part, as follows:

B. METHOD OF PAYMENT: "Rent to Buy" The Buyer shall pay $.00 down payment plus make rental payments to the Landlord that are equal to the [principal, interest, taxes, and insurance] Payment stated below. The 1st rental payment shall be due upon the execution of this agreement. Said payment shall apply to the current month. The Buyer shall make like payments, as rent, on the first of each month. Once the Buyer has made twenty-four (24) or more rental payments, the parties hereto shall execute a "Conditional Sales Contract" (Land Contract) form embodying the terms contained herein.

Plaintiffs' Ex. 7 at 1.

[8] The financial terms included a fixed interest rate of 16.30%, thirty years of monthly payments of $514, and estimated monthly property taxes of $35 for a total monthly payment of $549. Paragraph E of the Agreement provided that

The Buyer acknowledges and understands that the property is owned by a Land Trust and the owner must provide the Buyer with a 'Seller's Residential Real Estate Disclosure' under Indiana law (IC 24-4.6-2). The Buyer hereby acknowledges the receipt of said disclosure form. The Buyer also understands the Seller has never lived in the property and has little or no knowledge of the properties [sic ] condition, and therefore makes no warranties of condition and/or habitability. The Buyer has been made aware that independent inspections disclosing the condition of the property are available, and has been afforded the opportunity prior to the execution of this agreement to acquire said inspections. The Buyer agrees to purchase the property as "AS-IS" (THE OWNER WILL MAKE NO REPAIRS) condition and hereby releases the Seller, Landlord and/or Property Manager, it's [sic ] agents and/or employees, of any and all liability relating to any defect or deficiency affecting the property.

Plaintiffs' Ex. 7 at 1 (emphases in original). Paragraph C of the Agreement required the Lintners to make their payment on the first day of each month and provided that failure to timely make these payments subjected them to the risk of eviction.

[9] Along with the Agreement, the Lintners also signed a "Purchase Agreement Declaration" ("the Declaration"), which was explicitly made part of the Agreement. The Declaration provides as follows:

PURCHASE AGREEMENT INTENT: Purchase Agreement is not a "rent with an option to purchase", buyer is required to purchase and seller is required to sell under the agreed purchase price, down payment and monthly payment. Because the Purchase Agreement mentions the word "rent" [Rainbow] wishes to prevent misunderstandings and/or confusion about the intent of this agreement. At the time of signing, the buyer has the exclusive right to declare his/her intent in this agreement.

Plaintiffs' Ex. 8.

[10] The Lintners checked and initialed the "buying" option on the Declaration:

My intent is to purchase the property at 910 N. Oakland Av., Indianapolis, IN 46201. I am not renting the property. All payments shall apply to the principal and interest shown on the amortization schedule provided at closing. If I decide to sell the property during the term of our agreement I shall be entitled to all profits above my payoff. In Addition [sic ], I wish to save money by repairing and maintaining the property myself. I do not expect the property owner to make any repairs to the property and fully understand that I am buying the property "as-is" with out [sic ] any warranty of habitability.

Plaintiffs' Ex. 8. Neither the Agreement nor the Declaration contained any provision requiring reversion of the Property to Rainbow.

[11] The Lintners began arranging for repairs to the Property after signing the Agreement, finally agreeing to use Rainbow's contractors, with the costs of the repairs to be spread out in interest-free amounts added to the monthly payments. The Lintners agreed to make increased payments of $649 per month beginning in June of 2013. The repair work was completed on July 22, 2013, and the Lintners moved into the Property on or about August 1, 2013.

[12] Meanwhile, the Lintners had not made the May, June, or July of 2013 payments. In July of 2013, Rainbow began eviction proceedings but dismissed the complaint and agreed to a payment plan for the arrearage. After more arrearages and being given more chances to cure the delinquency, the Lintners made their final payment on February 16, 2015. On March 25, 2015, Rainbow again filed for eviction in Marion Small-Claims Court, and the Lintners appealed the matter to Marion Superior Court.

[13] On June 8, 2015, Rainbow filed a complaint in Marion Superior Court to terminate the Agreement and for immediate possession of the Property. On July 29, 2015, the Lintners answered Rainbow's complaint, raising defenses and counterclaims, including allegations of fraud and misrepresentation, deceptive acts pursuant to Indiana Code section 24-9-3-7, and failure to meet (and misstatement of) its obligations as a landlord pursuant to Indiana Code chapters 32-31-1 and 32-31-8.

[14] On May 17, 2016, the Lintners filed for partial summary judgment on their claims that the Agreement was a lease and that Rainbow breached the warranty of habitability and made false or deceptive statements regarding its ability to disclaim the warranty. On August 11, 2016, the trial court granted the Lintners' motion for partial summary judgment, ruling that (1) for the first two years the Agreement was a lease; (2) the Landlord-Tenant Act therefore governed the Agreement; (3) Rainbow was liable for breaching the warranty of habitability; and (4) Rainbow made false or deceptive statements.

[15] A bench trial was held on remaining issues on December 6, 2016, and January 10 and March 22, 2017. On June 8, 2017, the trial court entered its judgment, sustaining its earlier entry of partial summary judgment in favor of the Lintners. As for damages, the trial court concluded that while Rainbow had breached the warranty of habitability, the Lintners had not paid an unconscionable amount pursuant to the Agreement, were not entitled to the return of their payments, and were not entitled to damages for unjust enrichment. The trial court awarded the Lintners $1000 in compensatory and $3000 in punitive damages for what it found were Rainbow's fraudulent misrepresentations regarding the nature of the Agreement and also awarded $3000 in attorney's fees. Rainbow contends that the trial court erred in concluding that the Agreement was a lease and that Rainbow committed actual fraud. The Lintners cross-appeal, contending that the trial court abused its discretion in awarding them only $3000 in attorney's fees.

Discussion and Decision

Direct Appeal Issues

I. Whether the Agreement Is a Lease

[16] Rainbow challenges the trial court's grant of partial summary judgment to the Lintners, specifically its determination that the Agreement was a lease subject to the Landlord-Tenant Act. In Indiana, pretrial summary judgment rulings are reviewable after trial. Keith v. Mendus , 661 N.E.2d 26, 35 (Ind. Ct. App. 1996), trans. denied . As the moving party on summary judgment, the burden was on the Lintners to make a prima facie showing that there were no genuine issues of material fact and that they were entitled to judgment as a matter of law. Morris v. Crain , 71 N.E.3d 871, 879 (Ind. Ct. App. 2017). The trial court's entry of partial summary judgment is reviewed under a de novo standard of review. Id. When reviewing an entry of summary judgment, this Court does not weigh the evidence but considers the facts in the light most favorable to the nonmoving party. Reed v. Luzny , 627 N.E.2d 1362, 1363 (Ind. Ct. App. 1994), trans. denied . Like the trial court, this Court must determine whether there is a genuine issue of material fact and whether the moving party is entitled to judgment as a matter of law. Freidline v. Shelby Ins. Co. , 774 N.E.2d 37, 39 (Ind. 2002).

[17] The central question of this case is whether the Agreement was a lease governed by the Landlord-Tenant Act, and to answer this question, we must examine the provisions of both the Landlord-Tenant Act and the Agreement. An issue of statutory construction presents a question of law which is reviewed de novo on appeal. See Chrysler Group, LLC v. Review Bd. of the Ind. Dep't. of Workforce Dev. , 960 N.E.2d 118, 124 (Ind. 2012) ; State v. Eichorst , 957 N.E.2d 1010, 1012 (Ind. Ct. App. 2011), trans. denied . We owe no deference to the trial court's statutory interpretation. Art Country Squire, L.L.C. v. Inland Mortg. Corp. , 745 N.E.2d 885, 889 (Ind. Ct. App. 2001). Similarly, issues of contract interpretation are pure questions of law, which we also decide de novo . George S. May Int'l Co. v. King , 629 N.E.2d 257, 260 (Ind. Ct. App. 1994), trans. denied . We recognize that the unambiguous language of a contract is conclusive upon the contracting parties and the courts. Turnpaugh v. Wolf , 482 N.E.2d 506, 508 (Ind. Ct. App. 1985).

[18] Indiana Code section 32-31-2.9-3 defines the scope of the Landlord-Tenant Act, providing that it "appl[ies] to rental agreements for dwelling units located in Indiana." When the Landlord-Tenant Act applies, it requires a landlord to warrant a rental property's habitability, providing that, inter alia , "[a] landlord shall [... d]eliver the rental premises to a tenant in compliance with the rental agreement, and in a safe, clean, and habitable condition." Ind. Code § 32-31-8-5. There is no dispute that if the Landlord-Tenant Act applied to the Agreement, the Agreement violated the Act's warranty of habitability for rental premises. The question is whether the Landlord-Tenant Act applied to the Agreement.

[19] While the Landlord-Tenant Act does not define "lease," it broadly defines a "rental agreement" as "an agreement together with any modifications, embodying the terms and conditions concerning the use and occupancy of a rental unit." Ind. Code § 32-31-3-7(a). This limited guidance for determining whether a particular instrument is a lease is not quite sufficient to dispose of the question in this case. Fortunately, the Indiana Supreme Court has provided us with the additional guidance required.

[20] In a line of cases, the Indiana Supreme Court has made it clear that a lease, among other requirements, lasts a definite term and ends with the reversion of the real property to the grantor. In 1845, the Court stated that

[n]o particular form is necessary to make a good lease. Any words expressive of the intention of the parties, one to part with and the other to take the possession of premises for a definite time , whether in the form of "a license, covenant, or agreement," will constitute a good demise for years.

Munson v. Wray , 7 Blackf. 403, 404 (Ind. 1845) (citation omitted and emphasis added). In 1885, the Indiana Supreme Court reiterated that a lease must have an endpoint: "But it may be said, in general terms that where the conveyance of an estate in land, subordinate to that of the grantor, to a grantee, upon a valid consideration, and for a definite term , is made, the instrument making the conveyance is a lease." New York, Chicago & St. Louis Ry. Co. v. Randall , 102 Ind. 453, 457, 26 N.E. 122, 123 (1885) (emphasis added).

[21] In the 1892 case of Haywood v. Fulmer , the Indiana Supreme Court adopted the following definition of "lease," which now also explicitly required the previously-implied reversion to the original grantor: " 'A lease at the common law is a grant or assurance of a present or future interest for life, for years, or at will, in lands or other property of a demisable nature, a reversion being left in the party from whom the grant or assurance proceeds .' " 158 Ind. 658, 660, 32 N.E. 574, 575 (1892) (citation omitted and emphasis added). The Court was even more emphatic about the reversion requirement two decades later:

The effect of a lease is to give the lessee the right to the possession of the property for a term of years, or at the pleasure of the parties. It is within the contemplation of every lease that the property shall at some time, definitely fixed, or to be determined later, revert to the lessor.

Mendenhall v. 1st New Church Soc'y of Indpls. , 177 Ind. 336, 342, 98 N.E. 57, 60 (1912) (emphasis added).

[22] Although the question has been revisited infrequently since Mendenhall , the results have been consistent with that case and its predecessors. In 1914, this court stated that "[a] lease of real estate is a contract by which, ordinarily the owner divests himself of the possession and use of his property, in favor of the lessee, upon a valid consideration, for a definite term." Spiro v. Robertson , 57 Ind. App. 229, 234, 106 N.E. 726, 728 (1914) (citations omitted). In 1932, we said, " 'it is one of the essentials of a lease, that it should contain a reversion in favor of the party from whom the grant or assurance proceeds.' " Indian Ref. Co. v. Roberts , 97 Ind. App. 615, 630, 181 N.E. 283, 288 (1932) (quoting Smiley v. Van Winkle , 6 Cal. 605, 606 (1856) ). Most recently, we noted that "[i]t has long been the law in Indiana that '[a] lease of real estate is a contract by which, ordinarily[ ] the owner divests himself of the possession and use of his property, in favor of the lessee, upon a valid consideration, for a definite term.' " Smyrniotis v. Marshall , 744 N.E.2d 532, 535 (Ind. Ct. App. 2001) (quoting Spiro , 57 Ind. App. at 234, 106 N.E. at 728 ), trans. denied . Finally, the Landlord-Tenant Act itself recognizes that a defining characteristic of "rental agreements" is that they end at some point: "The term [rental agreement] includes an agreement, regardless of what the agreement is called, that satisfies the following: [...] (2) The agreement provides for a rental period, explicitly or implicitly, regardless of the term of the rental period." Ind. Code § 32-31-3-7(b). Our research has revealed no indication that the propositions for which the cited authority stands have been overturned, abrogated, limited, or even questioned, either judicially or legislatively.

[23] In light of the above authority, the requirement that a lease contemplate a definite term and a reversion to the lessor remains good law and, insofar as it was issued by the Indiana Supreme Court, is absolutely binding on this court:

We are bound by the decisions of our supreme court. See In re Petition to Transfer Appeals , 202 Ind. 365, 376, 174 N.E. 812, 817 (1931). Supreme court precedent is binding upon us until it is changed either by that court or by legislative enactment. Id. While Indiana Appellate Rule 65(A) authorizes this Court to criticize existing law, it is not this court's role to "reconsider" supreme court decisions.

Dragon v. State , 774 N.E.2d 103, 107 (Ind. Ct. App. 2002), trans. denied .

[24] Turning to the Agreement, it did not require that it would end after a definite term, much less end with reversion of the Property to Rainbow, which are necessary features of all leases in Indiana. We are therefore bound to conclude that the Agreement was not a lease and that the Landlord-Tenant Act's provisions did not govern it.

[25] The Lintners nonetheless argue that the Agreement was actually a lease because it contained many features they characterize as lease-like: it (1) required them to make monthly payments which generated no immediate equity; (2) allowed them to be evicted, not foreclosed; (3) explicitly referred to the first twenty-four payments as "rent"; and (4) placed restrictions on their use of the Property, such as limitations on plaster and stud removal and forbidding pets and unused vehicles. The Lintners characterize the Agreement as a "contract which [...] mingled [the] concepts of lease and purchase, selectively using them to exclusively benefit [Rainbow]." Appellees'/Cross-Appellants' Brief p. 17. While we agree that many of the identified provisions are like those generally found in leases (as opposed to sales agreements), none of this makes the Agreement a lease if it did not also require reversion to Rainbow at some point.

[26] This is not quite the end of our inquiry, however. In their Appellees' brief, the Lintners argue that even if the Agreement is not a lease, it was created to avoid application of the Landlord-Tenant Act and is thereby subject to its provisions. "The [Landlord-Tenant Act does] not apply to [... o]ccupancy under a contract of sale of a rental unit [...] if the occupant is the purchaser [...] unless the arrangement was created to avoid application of [the Landlord-Tenant Act.]" Ind. Code § 32-31-2.9-4 (statutory provisions reordered for clarity).

[27] Avoidance, however, was not advanced as a basis for relief by the Lintners in the trial court and is therefore waived for appellate consideration. "A party may not raise an issue for the first time [...] on appeal that was not raised in the trial court." Rodgers v. Rodgers , 503 N.E.2d 1255, 1257 (Ind. Ct. App. 1987), trans. denied . That said, Rainbow began its rent-to-buy program in 1992, over ten years before the Landlord-Tenant Act was enacted, and the Lintners point to nothing specific in the record, other than the Agreement itself, as evidence that the Agreement was created to avoid application of the Landlord-Tenant Act. While the Lintners characterize the Agreement as "a tangled and confusing array of provisions [that impose] additional duties of 'homeowners' but none of the benefits, in a high-risk rental contract with severe consequences for even a minor breach[,]" Appellees'/Cross-Appellants' Br. p. 38, this does not constitute evidence that it was created to avoid application of the Landlord-Tenant Act. In fact, the Declaration explicitly provides that it "is not an attempt to waiver or avoid application of the residential landlord-tenant statutes; its purpose is to clarify the intent of the agreement and to spell out financial responsibilities for repair and maintenance." Ex. 8. Even if the Linters had properly preserved this issue, our review of the record reveals nothing that would support a finding that the Agreement was created to avoid application of the Landlord-Tenant Act.

[28] Finally, while the Lintners do not argue (and the trial court did not conclude) that the Agreement is unconscionable, it is fair to say that the Lintners have consistently emphasized what they characterize as the predatory nature of the Agreement and argue that a liberal construction of the Landlord-Tenant Act-and a narrow construction of its exceptions-is sound public policy. Even if we accept the proposition that a broad reading of the Landlord-Tenant Act is sound public policy, it simply cannot be read broadly enough to make a lease out of something that lacks some of a lease's most fundamental characteristics.

II. Actual Fraud by Misrepresenting the Nature of the Agreement

[29] Rainbow contends that the trial court erred in concluding that it had committed fraud by misrepresenting the true nature of the Agreement, namely that Rainbow was not required to warrant the Property's habitability. Actual fraud consists of the following: "(1) a material representation of a past or existing fact by the party to be charged that; (2) was false; (3) was made with knowledge or reckless ignorance of its falsity; (4) was relied upon by the complaining party; and (5) proximately caused the complaining party's injury." Ruse v. Bleeke , 914 N.E.2d 1, 10 (Ind. Ct. App. 2009). We have concluded that the Agreement was not a lease and therefore not subject to the provisions of the Landlord-Tenant Act and its warranty of habitability. Therefore, any representations to that effect were not, in fact, false, which by itself fatally undercuts any finding of actual fraud and requires reversal of the trial court's judgment to that effect.

Cross-Appeal Issue

III. Attorney's Fees

[30] Pursuant to the Landlord-Tenant Act,

[i]f the tenant is the prevailing party in an action under this section, the tenant may obtain any of the following, if appropriate under the circumstances:
(1) Recovery of the following:
(A) Actual damages and consequential damages.
(B) Attorney's fees and court costs.

Ind. Code § 32-31-8-6(d).

[31] The Lintners contend that the trial court abused its discretion in awarding them only $3000 in attorney's fees after they submitted an affidavit of attorney's fees in the amount of $35,475. Because we have concluded that the trial court erroneously entered judgment in favor of the Lintners in all respects, however, the Lintners are not the "prevailing party in an action" pursuant to the Landlord-Tenant Act and are not entitled to seek recovery of any of their attorney's fees.

Conclusion

[32] The Agreement admittedly has some characteristics that are commonly associated with sales contracts and some commonly associated with leases. On the one hand, the Agreement requires buyers to pay for taxes, insurance, and necessary repairs; allows them to build equity (eventually); and provides that they may sell the property and keep the profit, which are all provisions commonly associated with sales contracts and ownership. On the other hand, the Agreement does not provide for the immediate accumulation of equity, places somewhat severe restrictions on the use and alteration of the property, and allows Rainbow to evict in the event of default rather than resort to foreclosure. Devices such as the Agreement seem to be a sort of hybrid, and an argument could be made that neither the current law pertaining to sales contracts nor the current law pertaining to leases is adequate to address the issues such devices raise. The Lintners and the amici also argue that rent-to-own contracts such as the Agreement are against public policy, alleging that they are used to prey on ignorant and unsophisticated "buyers" lured by the dream of home ownership who almost invariably end up with neither the home nor their investment in it. This may happen in some cases. Such concerns, however, are beyond the scope of this opinion and are the province of the General Assembly.

[33] That said, the central legal issue in this case is whether the Agreement was a lease, and we have concluded that it was not. Consequently, we reverse the trial court's entry of summary judgment in favor of the Lintners based on the conclusion that Rainbow violated the Landlord-Tenant Act's warranty of habitability. Moreover, we reverse the trial court's judgment that Rainbow committed actual fraud by misrepresenting the nature of the Agreement. Finally, we reverse the award of attorney's fees to the Lintners. We reverse the judgment of the trial court and remand with instructions to enter summary judgment in favor of Rainbow on its action for eviction and immediate possession of the Property and for further proceedings, as necessary.

[34] The judgment of the trial court is reversed and remanded with instructions.

Baker, J., and Crone, J., concur.

      We heard oral argument in this case on August 28, 2018, in the Indiana Supreme Court Courtroom in the Indiana Statehouse in Indianapolis. We commend counsel (Mr. Mulvaney for the Appellants and Mr. Laramore for the Appellees) for the high quality of their presentations and thank the staff of the Indiana Supreme Court for its assistance in conducting this argument.

      Indiana Code section 32-31-2.9-2 provides that the term "residential landlord-tenant statute" refers to any of these chapters. For convenience, they will be referred to, collectively, as "the Landlord-Tenant Act."

      While the parties seem to assume, and we agree, that a lease would qualify as a "rental agreement," the Landlord-Tenant Act seems to have been drafted to also cover rental agreements that are not in written form.

      The various amici also argue, inter alia , that devices such as the Agreement are deceptive and predatory, shift all of the risk and cost of the transaction onto the buyer, and are used by companies to exploit persons who they know will be very unlikely to be able to make payments over time. Some amici provide background on attempts over the years to circumvent consumer-protection laws by real-estate speculators and note that several surrounding states have recently amended their laws to curb such practices. There is no attempt to characterize these arguments as based on anything other than public policy grounds, and it is well-settled that "public policy is a matter for the General Assembly subject only to constitutional limitations on legislative authority." Murray v. Conseco, Inc. , 795 N.E.2d 454, 457 (Ind. 2003).


author: Riley, Judge.

text:
    STATE of Indiana, Appellant-Plaintiff, v. Lawrence LUCAS, Appellee-Defendant.
    Court of Appeals Case No. 18A-CR-92
    Court of Appeals of Indiana.
    FILED September 28, 2018
    Attorneys for Appellant: Curtis T. Hill, Jr., Attorney General of Indiana, Caryn N. Szyper, Deputy Attorney General, Indianapolis, Indiana
   Riley, Judge.

STATEMENT OF THE CASE

[1] Appellant-Plaintiff, State of Indiana (State), appeals the trial court's suppression of evidence obtained after a search of the home and garage of Appellee-Defendant, Lawrence Lucas (Lucas).

[2] We reverse and remand for further proceedings.

ISSUE

[3] The State presents one issue, which we restate as: Whether the trial court's grant of Lucas' motion to suppress is contrary to law.

[4] On the morning of May 11, 2016, Sergeant Matthew Gard (Sergeant Gard) of the Lafayette Police Department took a report from Bernard Brooks (Brooks) regarding an assault and theft. Brooks had been fighting with Lucas' mother, Anita, the previous evening and had gone to Lucas' home to sleep. Brooks fell asleep on Lucas' floor, only to be awakened by Anita hitting him on the head with an aluminum baseball bat and by Lucas' sister, Sharmeka, hitting him with her fists. Brooks was injured in the fracas and fled the home, leaving behind a jacket and a hat. Brooks also reported to Sergeant Gard that Anita and Sharmeka had taken his cell phone and $60 from his pocket.

[5] Based on Brooks' report, Sergeant Gard procured a search warrant for Lucas' home which provided for a search in relevant part as follows:

A yellow two story home with an attached two car garage with brick siding on the first level and yellow siding on the second floor, located at 3023 Yorktown Court, Lafayette, Indiana[,]
and to diligently search for, seize and forensically examine:
Clothing, [a] baseball bat, a cellular phone, U.S. currency, blood evidence or any evidence relating to an assault and/or theft occurring with said residence.

(Appellant's Appendix Vol. II, p. 42).

[6] Upon executing the search warrant, Sergeant Gard found blood about the home and a bloody baseball bat which matched the description Brooks had given him in the kitchen. While searching, Sergeant Gard went through a door located in the living room and into the attached garage. A black vehicle was parked inside the garage. Next to the vehicle on the ground, Sergeant Gard found a bloodied jacket matching the description of Brooks' jacket. Sergeant Gard looked inside the black vehicle and saw a large mound in the back seat which had been covered by a blanket. Sergeant Gard was concerned that objects could be concealed under the blanket, so he reached inside one of the vehicle's partially-opened windows and moved the blanket, revealing a large paper bag containing what Sergeant Gard suspected through his training and experience was synthetic marijuana.

[7] Based on the discovery of the suspected synthetic marijuana, as well as a safe, "shake" on the garage floor, and a large cardboard box in the garage which bore the label "California Herb Company," Sergeant Gard stopped his search and procured a second search warrant authorizing a search of the home and the black vehicle for evidence of narcotics activity. (Transcript Vol. II, p. 15). That search yielded additional evidence.

[8] On April 20, 2017, the State filed an Information charging Lucas with one Count of unlawful possession of a firearm by a serious violent felon, a Level 4 felony; one Count of dealing in a synthetic drug or synthetic drug lookalike substance, a Level 6 felony; one Count of possession of a synthetic drug or synthetic drug lookalike substance, a Class A misdemeanor; and one Count of maintaining a common nuisance, a Level 6 felony.

[9] On October 16, 2017, Lucas filed a motion to suppress in which he argued that the evidence procured from the search exceeded the scope of the warrant because "there was only bare speculation by Officer Gard regarding what was under the blanket." (Appellant's App. Vol. II, p. 56). On November 27, 2017, the trial court held a hearing on Lucas' motion. On December 20, 2017, the trial court entered its order granting Lucas' motion to suppress, ruling in relevant part "that the officer's entry into the vehicle and moving of the blanket exceeded the scope of the warrant and all evidence seized as a result of said action is suppressed." (Appellant's App. Vol. II, p. 62).

[10] The State now appeals. Additional facts will be added as necessary.

DISCUSSION AND DECISION

[11] We begin by noting that Lucas did not file a brief responding to the State's appeal. As such, the State need only establish prima facie error to merit reversal of the trial court's ruling in Lucas' favor. State v. Costas , 552 N.E.2d 459, 462 (Ind. 1990). The State appeals following the trial court's grant of a motion to suppress, which effectively terminated the prosecution of this case. Because the State appeals from a negative judgment, it bears the burden to show that the trial court's ruling was contrary to law. State v. Brown , 70 N.E.3d 331, 335 (Ind. 2017). When reviewing a trial court's suppression ruling, we determine whether the record contains substantial evidence of probative value that supports the trial court's decision. Id. "We evaluate the trial court's findings of fact deferentially, neither reweighing the evidence nor reassessing the credibility of the witnesses." Id. However, we review the trial court's conclusions of law de novo . Id.

[12] Lucas argued before the trial court that the search of the black vehicle exceeded the scope of the warrant because Sergeant Gard's act of moving the blanket in the vehicle was an extension of the warrant to a place where none of the objects listed in the warrant could have been found. Lucas contended that Sergeant Gard could only speculate what was under the blanket, and, therefore, his act of moving the blanket was unreasonable. The State counters that the search warrant permitted a search of the garage and that, therefore, any containers, including the black vehicle located there, were also searchable under the parameters of the warrant.

[13] The Fourth Amendment to the United States Constitution requires that a search warrant describe with specificity the place to be searched and the items sought. Griffith v. State , 59 N.E.3d 947, 958 (Ind. 2016). If a search exceeds the scope of the warrant, it is unconstitutional. Sidener v. State , 55 N.E.3d 380, 383 (Ind. Ct. App. 2016). Our United States Supreme Court has provided guidance on the parameters of a warranted search:

A lawful search of fixed premises generally extends to the entire area in which the object of the search may be found and is not limited by the possibility that separate acts of entry or opening may be required to complete the search.
Thus, a warrant that authorizes an officer to search a home for illegal weapons also provides authority to open closets, chests, drawers, and containers in which the weapon might be found .... When a legitimate search is under way, and when its purpose and its limits have been precisely defined, nice distinctions between closets, drawers, and containers, in the case of a home, or between glove compartments, upholstered seats, trunks, and wrapped packages, in the case of a vehicle, must give way to the interest in the prompt and efficient completion of the task at hand.

United States v. Ross , 456 U.S. 798, 820-21, 102 S.Ct. 2157, 72 L.Ed.2d 572 (1982) (footnote omitted). It appears that our Indiana state courts have not decided the precise issue of whether the Fourth Amendment permits an officer who has procured a search warrant for a home and garage to also search any vehicles found on the premises. Although we are not bound by federal authority, we may look to it for guidance in the absence of state law. Stonger v. Sorrell , 776 N.E.2d 353, 355-56 (Ind. 2002).

[14] The State draws our attention to United States v. Percival , 756 F.2d 600 (7th Cir. 1985). While executing a search warrant for Percival's home and attached garage, agents found a vehicle in the garage. Id. at 605. The agents unlocked the trunk and found a suitcase containing a large amount of illegal drugs. Id. Percival argued that the search of the vehicle located in his garage exceeded the scope of the search warrant and that a vehicle should not be viewed the same manner as other personal items found in a home because a vehicle has a lesser connection to the premises than other household items such as furniture or cabinets. Id. at 612.

[15] In rejecting that argument, the Percival court noted that while a vehicle is less fixed than a closet or cabinet, it is "no less fixed than a suitcase or handbag found on the premises, both of which can readily be searched under Ross if capable of containing the object of the search." Id. Observing the trend in other jurisdictions upholding such searches, the Percival court held that "a search warrant authorizing a search of particularly described premises may permit the search of vehicles owned or controlled by the owner of, and found on, the premises." Id. Percival has subsequently enjoyed support in our federal circuit and district courts. See e.g. , United State v. Evans , 92 F.3d 540, 543 (7th Cir. 1996) (search of trunk of vehicle in attached garage pursuant to warrant for house "with detached garage"), cert. denied 519 U.S. 1020, 117 S.Ct. 537, 136 L.Ed.2d 422 (1996) ; see also United States v. Rivera , 738 F.Supp. 1208, 1218 (N.D. Ind. 1990) (search of truck in driveway pursuant to warrant for home's premises).

[16] We recognize that Hoosiers have a heightened expectation of privacy in their vehicles. See Brown v. State , 653 N.E.2d 77, 79 (Ind. 1995) ("With respect to automobiles generally, it may safely be said that Hoosiers regard their automobiles as private and cannot easily abide their uninvited intrusion."). However, we find the reasoning of Percival to be persuasive and hold that, under the Fourth Amendment, a search warrant authorizing a search of a particularly described premises permits the search of vehicles owned or controlled by the owner of, and found on, the premises.

[17] Here, Sergeant Gard procured a search warrant for Lucas' "two story home with an attached two car garage" to search for "[c]lothing, [a] baseball bat, a cellular phone, U.S. currency, blood evidence or any evidence relating to an assault and/or theft occurring with said residence." (Appellant's App. Vol. II, p. 42). When Sergeant Gard entered the garage, he had not yet located the cell phone or the $60 Brooks had reported stolen. Sergeant Gard was permitted to search the black vehicle and, in the process, to lift the blanket covering the large mound located in the back seat, because the vehicle and the mound were capable of containing those objects. Ross , 456 U.S. at 820-21, 102 S.Ct. 2157 ; Percival , 756 F.2d at 612. The State has shown that the trial court's ruling granting Lucas' motion to suppress was contrary to law.

CONCLUSION

[18] Concluding that the search of the vehicle in Lucas' garage did not unconstitutionally exceed the scope of the search warrant, we reverse and remand for further proceedings consistent with this opinion.

[19] Reversed and remanded.

[20] Vaidik, C.J. and Kirsch, J. concur

      We do not address whether the search at issue here was permitted under the Indiana Constitution, as Lucas did not develop a separate state constitutional analysis below, Lucas has not filed an appellate brief, the trial court did not specify the constitutional basis for its order granting Lucas' motion to suppress, and, on appeal, the State does not proffer any separate state constitutional analysis. (Appellant's Br. p. 14 n.1).


author: Vaidik, Chief Judge.

text:
    Joseph BALIGA, DVM, Appellant-Petitioner, v. INDIANA HORSE RACING COMMISSION, Indiana Horse Racing Commission Staff, Appellees-Respondents
    Court of Appeals Case No. 17A-MI-3009
    Court of Appeals of Indiana.
    Filed October 1, 2018 Rehearing denied November 26, 2018
    Attorney for Appellant: Peter J. Sacopulos, Sacopulos, Johnson & Sacopulos, Terre Haute, Indiana
    Attorneys for Appellees: Curtis T. Hill, Jr., Attorney General of Indiana, Patricia C. McMath, Deputy Attorney General, Indianapolis, Indiana
   Vaidik, Chief Judge.

Case Summary

[1] Veterinarian Joseph Baliga was accused of giving a banned substance to a racehorse. He denies the accusation, but in a disciplinary proceeding before the Indiana Horse Racing Commission (IHRC), IHRC staff moved to have him found in default and disciplined without a hearing on the merits. Dr. Baliga opposed the motion, but an administrative law judge granted it, and the IHRC affirmed.

[2] Dr. Baliga then filed a petition for judicial review challenging the entry of default. The IHRC filed a motion to dismiss, arguing that its entry of default is not subject to judicial review. The trial court granted the IHRC's motion, and Dr. Baliga appeals. We hold that the IHRC's entry of default (1) can be reviewed and (2) was an abuse of discretion. We therefore direct the trial court to grant Dr. Baliga's petition for judicial review and to remand this matter to the IHRC for a hearing on the merits.

Facts and Procedural History

[3] Dr. Baliga specializes in the care and treatment of racehorses. He is licensed generally by the Indiana Board of Veterinary Medical Examiners and separately by the IHRC. In the fall of 2016, Dr. Baliga was working at the track at Hoosier Park in Anderson. On September 30, a security officer reported that he had seen Dr. Baliga give a banned substance to a horse. Under the IHRC's regulations, found in Title 71 of the Indiana Administrative Code, this accusation exposed Dr. Baliga to two forms of disciplinary proceedings: (1) proceedings by IHRC judges at the track, who can impose a penalty of up to $5000 and a license suspension of up to one year, see 71 Ind. Admin. Code 10-2, and (2) proceedings by the IHRC itself, which can impose more serious sanctions-a penalty of up to $5000 per day or occurrence and a license suspension of more than one year (or a license revocation), see 71 I.A.C. 10-3. Both types of proceedings were initiated against Dr. Baliga.

[4] First, on October 1, the IHRC judges at Hoosier Park imposed a "summary suspension" of Dr. Baliga's IHRC license-a temporary suspension pending a disciplinary hearing before the judges. 71 I.A.C. 10-2-3 ; see also Ind. Code § 4-31-12-15 ; Ind. Code § 4-31-13-2. At Dr. Baliga's request, the judges held a hearing on the summary suspension on October 31. Dr. Baliga was in attendance with his attorney. At the beginning of the hearing, an attorney for the IHRC explained:

As a reminder, today's hearing is not about the merits of the underlying case. The only question is whether Dr. Baliga should remain summarily suspended pending a final disciplinary hearing and a ruling.
* * * *
Today's hearing is not on the merits of the IHRC's case against Baliga.
Rather, it is only to consider whether it is appropriate for [Dr. Baliga] to remain suspended pending the hearing on any underlying charges.
The merits hearing will come later. To that end it is inappropriate for the Judges to consider eyewitness testimony or evidence relating to any complaints that might later be filed.

Appellant's App. Vol. II pp. 70-71. The executive director of the IHRC was present at the hearing and was called as a witness by the IHRC attorney. He testified that the IHRC was still evaluating whether to take "further action" against Dr. Baliga and that the summary suspension should continue in the meantime:

Attorney: And you understand that the reason we are here today is to determine if it is appropriate for Dr. Baliga to remain suspended, pending the final hearing on the merits of the underlying case?
Exec. Dir.: Yes, I do.
Attorney: Is the Commission continuing to consider the underlying merits of this case?
Exec. Dir.: Yes.
* * * *
Attorney: You indicated the Commission is continuing to investigate and consider this matter. Once that is complete, do you expect Commission Staff will proceed with further action against Dr. Baliga?
Exec. Dir.: We'll evaluate everything at the end of the investigation and make our decision from there.
Attorney: Do you believe it is appropriate for Dr. Baliga to remain suspended pending the outcome of a hearing on the merits of the case?
Exec. Dir.: Yes, I do.

Id. at 75-76. Then, when Dr. Baliga attempted to testify about what happened on September 30, the IHRC's attorney objected, again explaining that the hearing "is only about whether or not the Summary Suspension should stand" and that "[t]his is not the time to hash out the merits of the case" and "[n]ot the appropriate time to have this conversation." Id. at 80, 87. In her closing argument, the IHRC's attorney said, "Commission Staff respectfully requests that Dr. Baliga's license remain suspended, pending a final disciplinary hearing and ruling." Id. at 92. At the end of the hearing, the judges voted to continue the summary suspension "until the merits of the case are heard." Id. at 94.

The presiding judge added, "[W]e should hurry along. We should do what we can to get this case heard on the merits." Id. The IHRC's attorney responded, "Understood." Id. The judges did not set any future hearings or deadlines, and that was the end of their involvement in this matter.

[5] On November 10, ten days after that summary-suspension hearing at Hoosier Park, the executive director of the IHRC initiated the second disciplinary proceeding against Dr. Baliga. Specifically, he filed an "Administrative Complaint" with the IHRC pursuant to 71 I.A.C. 10-3-20. The executive director alleged a variety of rule violations and recommended a penalty, including a suspension of Dr. Baliga's IHRC license and a substantial fine. The complaint also stated that Dr. Baliga had twenty days to make a written request for a hearing, pursuant to 71 I.A.C. 10-3-20(d) ("Not later than the twentieth day after the date on which the executive director delivers or sends the administrative complaint, the person charged may make a written request for a hearing or may remit the amount of the administrative penalty to the commission.").

[6] Shortly after receiving the administrative complaint, on November 14, Dr. Baliga filed an appeal of his summary suspension with the IHRC. However, he did not make a separate request for a hearing on the administrative complaint. On December 6-six days after Dr. Baliga's deadline for making such a request-an IHRC attorney filed a Motion for Default against him in the administrative-complaint matter. The motion relied on 71 I.A.C. 10-3-20(d), which, in addition to requiring a written request for a hearing within twenty days, provides that failure to make such a request "results in a waiver of a right to a hearing on the administrative penalty as well as any right to judicial review." Later the same day, the administrative law judge (ALJ) who had been appointed in the administrative-complaint proceeding sent the parties a proposed default order.

[7] On December 12, Dr. Baliga filed a motion opposing the proposed default. In the motion, Dr. Baliga's attorney took the blame for the failure to file a request for hearing, explaining that (1) he did not realize that the administrative-complaint proceeding was separate from the summary-suspension proceeding and (2) because Dr. Baliga was actively challenging the allegation in the summary-suspension proceeding and had already been told that there would be a hearing on the merits, he believed that a further request for a hearing was unnecessary. The ALJ was not persuaded and, on December 16, issued an order recommending that Dr. Baliga be found in default. At Dr. Baliga's request, the IHRC reviewed the matter. It affirmed and adopted the ALJ's order in full, including the penalty sought by the executive director: a five-year suspension of Dr. Baliga's IHRC license, a $20,000 fine, and a permanent ban from administering Lasix (a diuretic commonly given to racehorses) at Indiana race tracks.

[8] Dr. Baliga then filed a petition for judicial review of the IHRC's ruling. He asked the trial court to reverse the IHRC's finding of default and to remand the matter to the agency for a hearing on the merits. The IHRC filed a motion to dismiss, arguing that the trial court could not review its entry of default. The trial court granted the IHRC's motion and dismissed Dr. Baliga's petition.

[9] Dr. Baliga now appeals.

Discussion and Decision

[10] Dr. Baliga contends that the ALJ and the IHRC should not have found him in default and that the trial court erred by dismissing his petition for judicial review. The IHRC defends the dismissal, but on a different ground than the one it advanced in its motion to dismiss. In its motion to dismiss, the IHRC argued that Dr. Baliga had failed to exhaust his administrative remedies and that the trial court therefore lacked subject-matter jurisdiction. Appellant's App. Vol. IV pp. 24-39. On appeal, however, the IHRC says nothing about jurisdiction or the exhaustion of administrative remedies. Instead, it asserts that the Administrative Orders and Procedures Act (AOPA), Ind. Code article 4-21.5, which governs agency adjudicative proceedings and judicial review of those proceedings, "does not give the reviewing court discretion to excuse a party's default." Appellees' Br. p. 17. Insofar as the IHRC means that its entry of default cannot be challenged, we disagree.

[11] The IHRC cites Indiana Code section 4-21.5-5-4(b)(2), which provides that "[a] person who ... is in default under this article ... has waived the person's right to judicial review under this chapter." To be sure, this statute bars judicial review of agency actions taken before or after an entry of default, at least where the entry of default goes unchallenged or is found to be proper. But the IHRC apparently reads this provision to mean that a person who is found in default at the agency level is barred from seeking judicial review of any of the agency's actions, including the finding of default itself . In other words, the IHRC seems to take the position that an agency's finding of default is non-reviewable. The IHRC does not cite any authority in support of this novel proposition, and we think it is incorrect. A court on judicial review is authorized to grant relief

if it determines that a person seeking judicial relief has been prejudiced by an agency action that is: (1) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; (2) contrary to constitutional right, power, privilege, or immunity; (3) in excess of statutory jurisdiction, authority, or limitations, or short of statutory right; (4) without observance of procedure required by law; or (5) unsupported by substantial evidence.

Ind. Code § 4-21.5-5-14(d). An agency's entry of default is certainly an "agency action," and we see no reason why such an action should be immune from judicial review.

[12] The IHRC also relies heavily on its own regulation, 71 I.A.C. 10-3-20(d), which provides in part that a person's failure to request a hearing within twenty days of being served with an administrative complaint "results in a waiver of a right to a hearing on the administrative penalty as well as any right to judicial review ." (Emphasis added). In dismissing Dr. Baliga's petition, the trial court concluded that this provision "is in accord with" Indiana Code section 4-21.5-3-24, the statute that governs the entry of default in agency proceedings. Appellant's App. Vol. II p. 10. Again, we disagree.

[13] Section 4-21.5-3-24 provides that if a party in an agency proceeding fails to "file a responsive pleading required by statute or rule" (as Dr. Baliga did here), the ALJ "may serve upon all parties written notice of a proposed default or dismissal order, including a statement of the grounds." Ind. Code § 4-21.5-3-24(a). If the ALJ chooses to do so (as the ALJ in this case did), the party against whom the proposed default was issued may, within seven days, "file a written motion requesting that the proposed default order not be imposed and stating the grounds relied upon." Id. at (b). If the party files such a motion (as Dr. Baliga did here), the ALJ "may either enter the order or refuse to enter the order." Id. at (c). In short, Section 4-21.5-3-24 provides that a person who fails to file a responsive pleading may , in the discretion of the ALJ, be found in default. 71 I.A.C. 10-3-20(d), on the other hand, goes further and requires a finding of default when a party fails to file a responsive pleading. In this respect, the regulation is invalid. "An agency may not by its rules and regulations add to or detract from the law as enacted, nor may it by rule extend its powers beyond those conferred upon it by law. Any regulation that conflicts with statutory law is wholly invalid." Leone v. Comm'r, Ind. Bureau of Motor Vehicles , 933 N.E.2d 1244, 1250 (Ind. 2010) (quoting Lee Alan Bryant Health Care Facilities, Inc. v. Hamilton , 788 N.E.2d 495, 500 (Ind. Ct. App. 2003), aff'd on reh'g , 793 N.E.2d 229 ).

[14] Having concluded that the IHRC's entry of default is subject to judicial review, we now proceed with that review. To the extent that the trial court found the entry of default to be proper, we owe no deference to that determination. Instead, we "stand in the trial court's shoes." Ind. State Ethics Comm'n v. Sanchez , 18 N.E.3d 988, 991 (Ind. 2014) ; see also Filter Specialists, Inc. v. Brooks , 906 N.E.2d 835, 844 (Ind. 2009) ("Appellate courts stand in the same position as that of the trial court when reviewing a decision of an administrative agency.").

[15] As set forth above, a court can set aside an agency action if it is

(1) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law; (2) contrary to constitutional right, power, privilege, or immunity; (3) in excess of statutory jurisdiction, authority, or limitations, or short of statutory right; (4) without observance of procedure required by law; or (5) unsupported by substantial evidence.

I.C. § 4-21.5-5-14(d). In his brief, Dr. Baliga cites the "contrary to constitutional right, power, privilege, or immunity" provision, Appellant's Br. p. 24, but he also emphasizes that the decision of the ALJ and the IHRC to find him in default was a discretionary one and argues that they abused that discretion, see , e.g., id. at 36; Reply Br. p. 13. A decision constitutes an abuse of discretion if it is clearly against the logic and effect of the facts and circumstances or the reasonable, probable, and actual deductions to be drawn therefrom. State v. Collier , 61 N.E.3d 265, 268 (Ind. 2016). We do not reach Dr. Baliga's constitutional arguments, because, for several reasons, we agree with him that the entry of default in this matter was an abuse of discretion.

[16] First, while it is true that Dr. Baliga did not file a direct response to the administrative complaint, it is also true that the IHRC was well aware that Dr. Baliga denied the accusation underlying the complaint. The same accusation formed the basis for the summary suspension by the Hoosier Park judges, and Dr. Baliga, with the knowledge of the IHRC and its executive director, was actively challenging that suspension both before and after the initiation of the administrative-complaint matter. Second, an IHRC attorney told Dr. Baliga at the October 31 hearing that "[t]he merits hearing will come later" and objected when Dr. Baliga tried to give his side of the story. And third, there is no evidence that the IHRC would have suffered any prejudice if the ALJ had declined to find Dr. Baliga in default. IHRC staff filed their motion for default only six days after the deadline for Dr. Baliga to request a hearing, and all the relevant events transpired over the course of just thirty-six days-from the filing of the administrative complaint on November 10 through the ALJ's entry of default on December 16. All along, the IHRC was on notice that Dr. Baliga denied the accusation against him.

[17] All of this leads to a more fundamental reason why the ALJ and the IHRC should have allowed this matter to proceed to a hearing on the merits. 71 I.A.C. 10-2, titled "Proceedings by Judges," envisions a disciplinary proceeding initiated by and conducted by on-site judges, without the involvement of the IHRC itself or its executive director. See 71 I.A.C. 10-2-2(a) ("On their own motion or on receipt of a complaint from an official or other person regarding the actions of a licensee, the judges may conduct an inquiry and disciplinary hearing regarding a licensee's actions."). 71 I.A.C. 10-3, titled "Proceedings by the Commission," envisions a separate disciplinary proceeding initiated by the IHRC or its executive director. See 71 I.A.C. 10-3-1(b) ; 71 I.A.C. 10-3-20. In this case, however, the seemingly clear line between these two types of proceedings was significantly blurred from the very beginning.

[18] In their October 1 ruling imposing the summary suspension, the Hoosier Park judges, instead of setting a date for a disciplinary hearing under 71 I.A.C. 10-2, stated that the matter "will be referred to the Executive Director of the Indiana Horse Racing Commission for further action." Appellant's App. Vol. II p. 23. The ruling did not say whether this "further action" would occur in the Hoosier Park proceeding under 71 I.A.C. 10-2-regulations that do not contemplate a role for the executive director-or in a separate IHRC proceeding under 71 I.A.C. 10-3. This is where the confusion started. Then, when the Hoosier Park judges held a hearing on the summary suspension, the IHRC's attorney called the IHRC's executive director as a witness and asked him how the IHRC was planning to proceed. The executive director testified that the IHRC was still investigating and considering whether to take further action. Of course, under 71 I.A.C. 10-2, on-site judges can take disciplinary action regardless of whether the IHRC itself takes action, so this testimony served only to confuse matters further. Finally, at the end of the hearing, the Hoosier Park judges did not schedule a hearing on the merits of the accusation against Dr. Baliga. Rather, the chief judge said that "we should hurry along" and "[w]e should do what we can to get this case heard on the merits," and the IHRC's attorney said that she "[u]nderstood." In other words, the judges left the ball in the IHRC's court.

[19] Taken together, these events created the distinct impression that the Hoosier Park disciplinary proceeding and any IHRC disciplinary proceeding would, for all intents and purposes, be consolidated. Certainly, better practice would have been for Dr. Baliga and his attorney to submit a written request for a hearing after receiving the administrative complaint, even if they thought doing so would be redundant. But they had already been told that "[t]he merits hearing will come later," and they were told that at a hearing where IHRC action was talked about as if it would simply be a continuation of the Hoosier Park proceeding. As such, they should not be faulted-or defaulted-for thinking that another hearing request was unnecessary.

[20] Under these circumstances, we readily conclude that the ALJ and the IHRC abused their discretion by finding Dr. Baliga in default. Therefore, we reverse the dismissal of Dr. Baliga's petition for judicial review and direct the trial court to grant the petition and to remand this matter to the IHRC for a hearing on the merits.

[21] Reversed and remanded.

Pyle, J., and Barnes, Sr. J., concur.

      Dr. Baliga's appeal of the summary suspension remained pending for two months but was dismissed after he was found in default in the administrative-complaint matter.