author: WENTWORTH, J.

text:
    CATERPILLAR, INC., Petitioner, v. INDIANA DEPARTMENT OF STATE REVENUE, Respondent.
    No. 49T10-0812-TA-70.
    Tax Court of Indiana.
    March 28, 2013.
    Timothy J. Eifler, Walter L. Sales, Stoll Keenon Ogden PLLC, Louisville, KY, Attorneys For Petitioner.
    Gregory F. Zoeller, Attorney General of Indiana, Timothy A. Schultz, Deputy Attorney General, Indianapolis, IN, Attorneys for Respondent.
   ORDER ON PARTIES’ CROSS-MOTIONS FOR SUMMARY JUDGMENT

WENTWORTH, J.

This matter concerns the proper calculation of Indiana net operating losses (NOLs) available for carryover when a corporation receives dividend income from its foreign subsidiaries (Foreign Source Dividends or FSDs). Caterpillar, Inc. and the Indiana Department of State Revenue are currently before the Court on cross-motions for summary judgment. While the parties offer several reasons to support their positions, the dispositive issue is whether Caterpillar’s FSDs are deductible in calculating its Indiana NOLs, including those available for carryover as a deduction from taxable income in future years under Indiana Code § 6-3-2-2.6. The Court finds that they are.

FACTS AND PROCEDURAL BACKGROUND

Caterpillar is a Delaware corporation commercially domiciled in Illinois. (Jt. Stipulation Facts (“Jt. Stip.”) ¶ 1; Pet’r Br. Supp. Mot. Summ. J. (“Pet’r Br.”) at 2.) It is the largest manufacturer of construction and mining equipment in the world, and it conducts its operations from several international and domestic locations, including a manufacturing plant in Lafayette, Indiana. (Jt. Stip. ¶¶ 2-3.) During 2000 through 2003, Caterpillar directly or indirectly owned over 250 subsidiaries, the majority of which were foreign corporations that operated exclusively outside the United States. (Jt. Stip. ¶ 4.) Caterpillar received dividends from both its domestic subsidiaries (U.S. Source Dividends) and its foreign subsidiaries (Foreign Source Dividends or FSDs) in each of the years 2000 through 2003 (the Loss Years). (See Jt. Stip. ¶¶ 6, 8.)

When Caterpillar calculated its Indiana adjusted gross income tax liability for the Loss Years, it started with its federal taxable income, which did not include its U.S. Source Dividends under I.R.C. § 243(a). (See Jt. Stip. ¶ 12.) Caterpillar’s federal taxable income did include, however, its Foreign Source Dividends. (See Jt. Stip. ¶ 12.) As a result, Caterpillar took the Foreign Source Dividend deduction under Indiana Code § 6-3-2-12 and reported Indiana NOLs on a separate company basis in each of the Loss Years. (See Jt. Stip. ¶¶ 11-12.)

Prior to the Loss Years, Caterpillar reported taxable adjusted gross income on its 1996 through 1999 Indiana tax returns on a separate company basis. (Jt. Stip. ¶ 10.) Thereafter, Caterpillar filed amended returns for those years to carryback the unused Indiana NOLs reported on its 2000, 2001, and 2002 Loss Year returns, requesting a refund for overpaid taxes. (Jt. Stip. ¶¶ 13-14.)

The Department subsequently audited Caterpillar’s 1996 through 2003 tax returns. (Jt. Stip. ¶ 15.) The audit determined that Caterpillar’s Indiana NOL deductions were inaccurate because they deducted Caterpillar’s Foreign Source Dividend income. (Jt. Stip. ¶ 17.) The Department recalculated Caterpillar’s NOLs for the Loss Years by adding back the Foreign Source Dividend income, which reduced the NOL amount available for carryback and carryforward. (Jt. Stip. ¶ 18, Ex. 16A.)

Caterpillar protested the Department’s recalculation of its Indiana NOLs. (Jt. Stip. ¶ 20.) On October 10, 2008, the Department issued its Letter of Findings (LOF) denying Caterpillar’s protest. (Jt. Stip. ¶ 22, Ex. 22.)

On December 9, 2008, Caterpillar initiated this original tax appeal. On October 30, 2009, Caterpillar moved for summary judgment, and on January 15, 2010, the Department filed its cross-motion for summary judgment. The Court held a hearing on the parties’ cross-motions on June 29, 2010. Additional facts will be added as necessary.

STANDARD OF REVIEW

Summary judgment is proper when the designated evidence demonstrates that no genuine issues of material fact exist and the moving party is entitled to judgment as a matter of law. Ind. Trial Rule 56(C). Cross-motions for summary judgment do not alter this standard. Mirant Sugar Creek, LLC v. Indiana Dep’t of State Revenue, 930 N.E.2d 697, 699 (Ind. Tax Ct.2010) (citation omitted). Resolution of a case by summary judgment is particularly appropriate when, as here, the relevant facts are undisputed and only questions of statutory interpretation are at issue. See Whetzel v. Dep’t of Local Gov’t Fin., 761 N.E.2d 904, 908 (Ind. Tax Ct.2002) (citation omitted). “One of the fundamental rules of statutory construction is that a statute which is clear and unambiguous on its face needs no interpretation.” Indiana Dep’t of State Revenue v. Endress & Hauser, Inc., 404 N.E.2d 1173, 1175 (Ind.Ct.App.1980).

LAW & ANALYSIS

Indiana Code § 6-3-2-2.6 (the NOL Statute) provided the method to determine an Indiana NOL:

An Indiana net operating loss equals the taxpayer’s federal net operating loss for a taxable year as calculated under Section 172 of the Internal Revenue Code, derived from sources within Indiana and adjusted for the modifications required by IC 6-3-1-3.5.

Ind.Code § 6-3-2-2.6(c) (2004) (footnote omitted). Indiana Code § 6-3-2-12 (the FSD Statute), in relevant part, provided:

A corporation that includes any foreign source dividend in its adjusted gross income for a taxable year is entitled to a deduction from that adjusted gross income.

Ind.Code § 6-3-2-12(b) (2003).

The parties dispute whether the deduction of FSDs under the FSD Statute applies when calculating Indiana NOLs under the NOL Statute. The Department claims that Caterpillar was not entitled to deduct its FSDs in calculating its Indiana NOLs because the NOL Statute neither expressly incorporates the FSD Statute nor specifically references deducting FSDs as a modification in Indiana Code § 6-3-1-3.5. (See, e.g., Resp’t Br. Supp. Cross-Mot. Summ. J. at 7-8, 17.) Caterpillar contends, however, that the method of calculating Indiana NOLs necessarily triggered the statutory deduction of FSDs because its FSD income was included in its adjusted gross income in calculating its Indiana NOL for each of the Loss Years. (See, e.g., Pet’r Br. at 17-19.) To determine whether Caterpillar is entitled to deduct its FSD income in calculating its Indiana NOLs, the Court must answer two questions: 1) is “adjusted gross income” a component of the Indiana NOL Statute and, if so, 2) is Caterpillar’s FSD income included in that adjusted gross income.

1.

The term “adjusted gross income” does not appear in the Indiana NOL Statute. See I.C. § 6-3-2-2.6. Nonetheless, a corporation’s “adjusted gross income” is “the same as ‘[federal] taxable income’ (as defined in Section 63 of the Internal Revenue Code)[,]” as modified under Indiana Code § 6-3-1-3.5. Ind.Code § 6-3-l-3.5(b) (2003); see also Subaru-Isuzu Auto., Inc. v. Indiana Dep’t of State Revenue, 782 N.E.2d 1071, 1075 (Ind. Tax Ct.2003). Accordingly, “adjusted gross income” is a component of the Indiana NOL Statute if the calculation includes “federal taxable income” that is modified by Indiana Code § 6-3-1-3.5.

To determine the amount of an Indiana NOL, a taxpayer begins with its federal NOL calculated under I.R.C. § 172. See I.C. § 6-3-2-2.6(c). A federal NOL “means the excess of the deductions allowed by this ehapter[, as modified,] over the gross income.” I.R.C. § 172(c) (2003) (footnote added). Compare that definition to “the term ‘[federal] taxable income’ [which] means gross income minus the deductions allowed by this chapter” in determining federal income tax. I.R.C. § 63(a) (2003). Although these definitions are not identical, their calculations are. Cf I.R.C. § 172 with I.R.C. § 63. Consequently, a taxpayer’s federal taxable income is included in or identical to its federal NOL.

The federal taxable income component within the Indiana NOL Statute must also be modified under Indiana Code § 6-3 — 1—3.5(b), however, if it is to constitute “adjusted gross income.” The plain language of the Indiana NOL Statute itself requires the federal NOL to be modified under Indiana Code § 6-3-1-3.5; thus, the resulting calculations contain “adjusted gross income.” See I.C. § 6-3-2-2.6(d)(l). Consequently, even though the term “adjusted gross income” is not used in the Indiana NOL Statute, the components of the NOL calculation establish its presence.

2.

Next, the Court must determine whether Caterpillar’s FSD income is included in its “adjusted gross income” within the NOL Statute. Caterpillar’s federal taxable income is the starting point for determining its Indiana adjusted gross income. See I.C. § 6 — 3—1—3.5(b); see also Endress & Hauser, 404 N.E.2d at 1175. As stated above, federal taxable income is gross income minus the deductions allowed by the Internal Revenue Code. See I.R.C. § 63(a). Caterpillar’s gross income (“all income from whatever source derived”) included its FSD income. See I.R.C. § 61(a) (2003); (see also Jt. Stip. ¶ 12.) The facts further reveal that in calculating its federal taxable income for the Loss Years, Caterpillar did not deduct its FSDs from its gross income under I.R.C. § 245. (See Jt. Stip. ¶¶ 6-7, 9 (footnote added).) Finally, the statutory adjustments delineated in Indiana Code § 6-3-1-3.5 did not require the subtraction of FSD income. See I.C. § 6 — 3—1—3.5(b)(1)—(8). As a result, Caterpillar’s FSDs were included in its federal taxable income, in its federal NOL, and in its adjusted gross income within the Indiana NOL Statute. Caterpillar was therefore entitled to deduct its FSD income under Indiana Code § 6-3-2-12 in calculating its Indiana NOLs.

The plain meaning of definitions and words used in each of the relevant federal and Indiana statutes compel this conclusion. See Johnson Cnty. Farm Bureau Coop. Ass’n v. Indiana Dep’t of State Revenue, 568 N.E.2d 578, 580-81 (Ind. Tax Ct.1991), (providing that the words of the statutes are the best evidence of the Legislature’s intended meaning), aff'd by 585 N.E.2d 1336 (Ind.1992). Moreover, finding that the Indiana NOL Statute requires FSDs to be deducted while the federal NOL does not is consistent with the Legislature’s intent in enacting Indiana Code § 6-3-2-2.6.

A statutory amendment raises the presumption that the Legislature intended to change the law, unless it plainly appears that the amendment was passed in order to express its original intent more clearly. Endress & Hauser, 404 N.E.2d at 1175 (citations omitted); see also United Nat’l Ins. Co. v. DePrizio, 705 N.E.2d 455, 460 (Ind.1999) (citations omitted). As originally set forth, corporate adjusted gross income completely conformed with the federal NOL under I.R.C. § 172 because there were no Indiana statutory adjustments involving NOLs. See Endress & Hauser, 404 N.E.2d at 1175. In 1983, the Legislature decoupled from this federal NOL conformity by including an adjustment that only allowed losses from an Indiana source. See P.L. 82-1983, § l. Then, in 1987, the Legislature moved further away from federal NOL conformity by deleting Indiana Code § 6 — 3—1—3.5(b)(4) and enacting in its place an independent Indiana NOL Statute. See P.L. 91-1987, § 4. These amendments, deletions, and additions to Indiana’s treatment of NOLs clearly indicate that the Legislature intended to change from complete federal NOL conformity to less conformity by providing several Indiana-specific distinctions. It is in keeping with this history to find that deducting FSDs is one of those distinctions.

Similarly, in 1987, the Legislature added a separate FSD Statute to the Indiana Code, like many other states, to ensure the calculation of taxable income did not discriminate against taxpayers with Foreign Source Dividends by more favorable treatment of taxpayer’s with U.S. Source Dividends. See P.L. 383-1987(ss), § 4; see also Kraft Gen. Foods, Inc. v. Iowa Dep’t of Revenue & Finance, 505 U.S. 71, 81, 112 S.Ct. 2365, 120 L.Ed.2d 59 (1992) (finding Iowa’s tax scheme discriminated against foreign commerce by taxing the dividends of a foreign subsidiary, but not the dividends of a domestic subsidiary in violation of the Foreign Commerce Clause). A clue that the Legislature intended the FSD Statute to have a broader application, however, is found within the language of the FSD Statute itself. It is written broadly to apply to “a corporation that includes any foreign source dividend in its adjusted gross income for a taxable year.” I.C. § 6-3-2-12(b). Likewise, the Legislature omitted language limiting the FSD Statute’s application to the calculation of adjusted gross income under Indiana Code § 6-3-1-3.5. Id. Moreover, implicit in the Legislature’s provision of the FSD Statute in a separate provision from Indiana Code § 6-3-1-3.5 is the conclusion that the Legislature intended the FSD Statute to apply whenever FSD income is included in adjusted gross income, even when calculating Indiana NOLs.

CONCLUSION

For all the reasons stated above, the Court GRANTS summary judgment to Caterpillar and DENIES summary judgment to the Department.

SO ORDERED.

      . For example, the parties dispute whether Indiana Code § Ó-3-2-2 or certain federal elections controlled the inclusion/exclusion of FSDs in calculating an Indiana NOL. (Cf., e.g., Pet’r Reply Br. at 18-19; Pet'r Br. Supp. Mot. Summ. J. ("Pet’r Br.”) at 13-16 with Resp’t Resp. Br. at 2-3, 5-8; Resp’t Br. Supp. Cross-Mot. Summ. J. ("Resp’t Br.”) at 9-10, 16-17.) The parties also dispute whether the inclusion/exclusion of FSDs in calculating an Indiana NOL violated the Foreign Commerce or Equal Protection Clauses of the United States Constitution. (Cf. Pet'r Br. at 25-30 with Resp’t Br. at 22-24.)

        . The parties dispute whether the 2002 or the 2004 version of Indiana Code § Ó-3-2-2.6 applies in this case. (Cf. Resp't Br. at 14-15 with Pet’r Reply Br. at 5-6.) A non-code section enacted with the 2004 version of the statute indicates that the 2004 version controls:
      (f) The following provisions apply to deductions for net operating losses that are claimed after December 31, 2003:
      (2) Deductions for net operating losses that were incurred in taxable years ending before January 1, 2004, and that are carried forward and deducted in taxable years ending after December 31, 2003, must be calculated under IC Ó-3-2-2.5 and IC 6-3-2-2.Ó, both as amended by this act.
      P.L. 81-2004, § 62 (repealed 2010). (See also Hr’g Tr., Pet’r Ex. (Instructions for 2004 Form IT-20 at 24) citing the non-code section and instructing that: ”[a]ll loss years ending after January 1, 2004 and pre-existing NOL(s) carried over to a taxable year after this date must be recomputed by applying the amended provisions of this Act”).)

      . The modifications either disregard or adjust an otherwise allowable deduction in computing taxable income. See I.R.C. § 172(d) (2003). The only modification applicable here eliminates any federal NOL deduction to prevent NOL carrybacks and carryforwards to other taxable years from enlarging an NOL for the loss year. See id. at (d)(1).

      . The deduction allowed under I.R.C. § 245 applies exclusively to the U.S. source portion of foreign dividends. See I.R.C. § 245 (2003). Caterpillar was not entitled to take this deduction because its foreign subsidiaries did not operate in the U.S. (See Pet'r Br., App. at Ex. 2 ¶ 14.)

      . As originally enacted, Indiana Code § 6-3-1-3.5(b) defined "adjusted gross income” similar to today as "federal taxable income.” As a result, Indiana conformed 100% to the federal NOL. In 1983, the Legislature added subsection (b)(4) to Indiana Code § 6 — 3—1— 3.5(b), which stated:
      Add an amount equal to the deduction allowed under Section 172 of the Internal Revenue Code for net operating losses that are derived from sources outside Indiana. The amount of net operating losses that are derived from sources outside Indiana shall be determined in the same manner that the amount of business income derived from outside Indiana is determined under IC 6-3-2-2.
      P.L. 82-1983, § 1.


source: Caselaw Access Project

license: Public Domain

text:
    INDIANAPOLIS PUBLIC TRANSPORTATION CORPORATION, Petitioner, v. INDIANA DEPARTMENT OF LOCAL GOVERNMENT FINANCE, Respondent.
    No. 49T10-0910-TA-76.
    Tax Court of Indiana.
    May 3, 2013.

      Jeffrey S. Dible, Frost Brown Todd LLC, Indianapolis, IN, Attorney for Petitioner.
    Gregory F. Zoeller, Attorney General of Indiana, Timothy A. Schultz, Deputy Attorney General, Indianapolis, IN, Attorneys for Respondent.
   WENTWORTH, J.

Indianapolis Public Transportation Corporation (IndyGo) appeals the Department of Local Government Finance’s (DLGF) final determination denying its excess property tax levy request for the 2007 budget year. On appeal, IndyGo argues that the DLGF’s final determination must be reversed because it is unlawful, not supported by the evidence, and an abuse of discretion. The Court disagrees.

FACTS AND PROCEDURAL HISTORY

IndyGo, a public transportation corporation, provides bus service throughout Marion County, Indiana. IndyGo does not provide bus service, however, within the City of Lawrence, the City of Southport, and the Town of Speedway.

In November of 2008, IndyGo requested the DLGF’s permission, pursuant to Indiana Code § 6-1.1-18.5-16, to impose an excess property tax levy. In its request documentation, IndyGo indicated that, due to an “erroneous assessed valuation,” it had suffered property tax revenue shortfalls in budget years 2006 and 2007. (See Cert. Admin. R. at 1.) IndyGo therefore sought to impose an excess levy in the aggregate amount of $1,047,369 ($344,478 for its 2006 shortfall and $702,891 for its 2007 shortfall).

The DLGF referred IndyGo’s request to the Local Government Tax Control Board for a recommendation. On February 26, 2009, the Tax Control Board held a hearing during which IndyGo explained how, using data from the Marion County Treasurer’s office, it calculated its 2007 shortfall:

first it computed the total amount of property taxes (both real and personal) charged in Marion County for the 2006 (pay 2007) assessment as $1,234,203,346;
from that figure, it subtracted $65,534,933, which it determined represented the total amount of property taxes (both real and personal) charged for the 2006 (pay 2007) assessment within Lawrence, Southport, and Speedway for a result of $1,168,667,81s;
it next computed the total amount of property taxes (both real and personal) paid in Marion County for the 2006 (pay 2007) assessment as $1,147,620,620;
from that figure, it subtracted $58,429,384, which it determined represented the total amount of property taxes (both real and personal) paid for the 2006 (pay 2007) assessment within Lawrence, Southport, and Speedway, for a result of $1,089,189,357;
by subtracting the “paid” from the “charged,” IndyGo concluded that in budget year 2007, Marion County suffered a property tax revenue shortfall in the amount of $79,478,456 (i.e., $1,168,667,813 minus $1,089,189,377);
of that shortfall, IndyGo determined that $770,941, or .00971%, was its own. IndyGo arrived at this amount by dividing Center Township’s tax rate of 3.7166% by IndyGo’s tax rate of .0361% and then applying that result (i.e., .00971%) against the $79,478,456.

(See generally Cert. Admin. R. at 8-23 (footnote added).) IndyGo stated during the hearing that it used the same methodology to calculate its 2006 shortfall.

A DLGF representative also attended the hearing, presenting documentation that showed the amount of the certified levy, the actual collections, and the delinquent tax collections regarding IndyGo’s general fund for both 2006 and 2007. Based on that documentation, the DLGF representative explained that IndyGo did not have a property tax revenue shortfall in 2007: its certified levy was $15,229,898 and it actually collected $15,315,930. (See Cert. Admin. R. at 69, 126 (explaining that the DLGF calculates shortfalls by subtracting the actual collections figure from the certified levy figure).) At the conclusion of the hearing, the Tax Control Board’s members voted unanimously to recommend to the DLGF that IndyGo’s excess property tax levy request for both 2006 and 2007 be approved.

On September 16, 2009, the DLGF issued a final determination denying Indy-Go’s 2007 excess property tax levy request. The DLGF’s final determination, in its entirety, stated:

The [DLGF] has reviewed your appeal for a levy increase due to a Shortfall in budget year 2007 in the amount of $702,478. After a review of the petition pursuant to IC 6-1.1-18.5, and in consideration of all evidence provided, the [DLGF] finds as follows:

Denied:

The excessive levy appeal for [IndyGo] is denied because the unit did not have a shortfall in 2007. The unit’s property tax levy for [the] 2007 General Fund was $15,229,898 and the unit collected $15,315,934 for the General Fund.

(Cert. Admin. R. at 76.) The following day, the DLGF issued a final determination with respect to IndyGo’s excess property tax levy request for the 2006 budget year:

The [DLGF] has reviewed your appeal for a levy increase due to a Shortfall in budget year 2006 in the amount of $344,478. After a review of the petition pursuant to IC 6-1.1-18.5, and in consideration of all evidence provided, the [DLGF] finds as follows:
Modified Approval:
The excessive levy appeal for [IndyGo] is approved in the amount of $218,999. The unit’s shortfall appeal for budget year 2006 is reduced because the unit received $125,479 too much levy for budget year 2008.

(Cert. Admin. R. at 75.)

On October 29, 2009, IndyGo filed an original tax appeal challenging the DLGF’s final determination with respect to its 2007 excess tax levy appeal. The Court heard the parties’ arguments on April 21, 2011. Additional facts will be supplied as necessary.

STANDARD OF REVIEW

This Court hears appeals from final determinations of three administrative agencies: 1) the Indiana Department of Revenue (Department); 2) the Indiana Board of Tax Review (Indiana Board); and 3) the DLGF. See Ind.Code §§ 33-26-3-1, -2 (2013); Ind.Code § 33-26-6-0.2 (2013). When reviewing final determinations of the Department and the Indiana Board, the Court is bound by statutorily-prescribed standards of review. See, e.g., Ind. Code §§ 6-8.1-5-l(h)-(i), -9-l(c)-(d) (2013) (standard of review applied to final determinations of the Department); Ind. Code § 33-26-6-6 (2013) (standard of review applied to final determinations of the Indiana Board). The statutes are silent, however, with respect to the standard of review this Court is to employ when reviewing final determinations of the DLGF.

Given that silence, this Court will not go any further in this case than to review the propriety of 1) the DLGF’s factual findings and 2) the DLGF’s legal conclusions in light of those factual findings. See State Bd. of Tax Comm’rs v. Gatling Gun Club, Inc., 420 N.E.2d 1324, 1326-29 (Ind.Ct.App.1981) (discussing the limited nature of the scope of judicial review of administrative agency decisions in general). In other words, the Court will review the DLGF’s findings of fact and conclusions of law to determine whether they are arbitrary, capricious, an abuse of discretion, unsupported by substantial evidence or in excess of statutory authority. See id. See also Scopelite v. Dep’t of Local Gov’t Fin., 939 N.E.2d 1138, 1147 (Ind. Tax Ct.2010); DeKalb Cnty. E. Cmty. Sch., Dist. v. Dep’t of Local Gov’t Fin., 930 N.E.2d 1257, 1260-61 (Ind. Tax Ct.2010); Clark-Pleasant Cmty. Sch. Corp. v. Dep’t of Local Gov’t Fin., 899 N.E.2d 762, 769 (Ind. Tax Ct.2008) (all explaining that the Court will consider the evidence as contained within the administrative record to determine if the DLGF’s factual findings are supported by substantial evidence and that its legal conclusions are correct). See also Ind.Code § 6-1.1-30-1 (2013) (explaining that the DLGF is required to keep a public record of its proceedings and orders, a properly certified and attested copy of which “is sufficient evidence in all courts or proceedings to prove an action, rule or order of the [DLGF]”).

ANALYSIS

Each year, public transportation corporations pay their operating costs and expenditures from the collection of local property taxes. See, generally, Ind.Code § 6-1.1-17-0.5 through -21 (2013); Ind. Code § 36-1-2-10 (2013); Ind.Code § 36-9 — 4—12 (2013) (all providing the general procedures by which public transportation corporations fix and review their budgets, tax rates, and tax levies). While public transportation corporations are subject to property tax levy limits under Indiana Code § 6-1.1-18.5-3, they may petition for excess tax levies when they suffer from property tax revenue shortfalls. Indeed, during the time period at issue in this case, Indiana Code § 6-1.1-18.5-16 provided, in relevant part:

(a) A civil taxing unit may request permission from the local government tax control board to impose an ad valorem property tax levy that exceeds the limits imposed by [Indiana Code § 6-1.1-18.5-3] if:
(1)the civil taxing unit experienced a property tax revenue shortfall that resulted from erroneous assessed valuation figures being provided to the civil taxing unit;
(2) the erroneous assessed valuation figures were used by the civil taxing unit in determining its total property tax rate; and
(3) the error in the assessed valuation figures was found after the civil taxing unit’s property tax levy resulting from that total rate was finally approved by the department of local government finance.
(b) A civil taxing unit may request permission from the local government tax control board to impose an ad valorem property tax levy that exceeds the limits imposed by [Indiana Code § 6-1.1-18.5-3] if the civil taxing unit experienced a property tax revenue shortfall because of the payment of refunds that resulted from appeals under this article and IC 6-1.5.
(c) If the local government tax control board determines that a shortfall described in subsection (a) or (b) has occurred, it shall recommend to the department of local government finance that the civil taxing unit be allowed to impose a property tax levy exceeding the limit imposed by [Indiana Code § 6-1.1-18.5-3], and the department may adopt such recommendation. However the maximum amount by which the civil taxing unit’s levy may be increased ... equals the remainder of the civil taxing unit’s property tax levy for the particular calendar year as finally approved by the department of local government finance minus the actual property tax levy collected by the civil taxing unit for that particular calendar year.

Ind.Code § 6 — 1.1—18.5—16(a)—(c) (2006) (amended 2007) (emphasis added).

On appeal, IndyGo first claims that the DLGF’s final determination denying its excess tax levy request for the 2007 budget year is either contrary to law or an abuse of discretion because the DLGF “did not follow the correct statutory procedure under I.C. § 6-1.1-18.5-16” in determining that IndyGo did not have a property tax revenue shortfall. (Pet’r Br. Supp. Mot. Summ. J. (“Pet’r Br.”) at 26.) Alternatively, IndyGo contends that the DLGF’s final determination is not supported by the evidence because it “has not provided any rational explanation for its summary denial of [the 2007] levy [request] ... and its approval of [the 2006] levy [request] ... where both [requests] used the same data sources and the same calculation method-ologyf.]” (Pet’r Br. at 29.)

I.

IndyGo acknowledges that neither Indiana Code § 6-1.1-18.5-16, nor any DLGF regulation, prescribes a method for calculating a property tax revenue shortfall. (See Pet’r Br. at 7-8, Oral Argument Tr. at 17.) Despite this lack of guidance, IndyGo explains that the methodology used to calculate a property tax revenue shortfall must comport with the “clearly stated” legislative policy set forth in Indiana Code § 6-l.l-18.5-16(c): that collections of property tax payments due and payable in earlier years should not be counted as actual collections for the “shortfall” year. (See Pet’r Br. at 7, 24-25.)

IndyGo argues that the DLGF did not provide evidence to show that it complied with this legislative policy in calculating IndyGo’s 2007 shortfall (or lack thereof). (See Pet’r Br. at 22, 26.) As support for this argument, IndyGo points to the DLGF’s $15,315,394 collections number as it is “not consistent” with the $14,458,957 collections number IndyGo computed using the Marion County Treasurer’s records. (Pet’r Br. at 26.) See also supra note 2. Furthermore, IndyGo questions what the DLGF included in calculating its $15,315,394 number because no evidence specifically “identified or described [its computation] as [being] limited to property taxes assessed and levied for assessment year 2006 (payment year 2007).” (Pet’r Br. at 19 (emphasis omitted).) “[T]he only logical conclusion” for the difference in the numbers, IndyGo therefore asserts, is that the DLGF erroneously included delinquent property tax collections in its 2007 shortfall calculation and, as a result, it “did not follow the correct statutory procedure under [Indiana Code] § 6-l.l-18.5-16[.]” (Pet’r Br. at 26.)

As the party challenging the DLGF’s final determination, IndyGo bears the burden of demonstrating that it is either contrary to law or an abuse of discretion. See Scopelite, 939 N.E.2d at 1145. To meet this burden, IndyGo must show that the DLGF’s final determination “violates a[] statute, constitutional provision, legal principle, or rule of substantive or procedural law” or “is clearly against the logic and effect of the facts and circumstances” of the case. See Shelbyville MHPI, LLC v. Thurston, 978 N.E.2d 527, 529 (Ind. Tax Ct.2013) (citation omitted); Hubler Realty Co. v. Hendricks Cnty. Assessor, 938 N.E.2d 311, 315 n. 5 (Ind. Tax Ct.2010) (citation omitted). Here, IndyGo has done neither. Rather, it has merely invited the Court to reweigh the evidence in its favor or to hold that the DLGF should have provided more, different, or better evidence to support its collections number. But see Grant Cnty. Assessor v. Kerasotes Showplace Theatres, LLC, 955 N.E.2d 876, 880 (Ind. Tax Ct.2011) (explaining that in reviewing administrative agency final determinations, this Court will not reweigh the evidence presented during the administrative proceedings nor will it assess the credibility of any witnesses who testified at the administrative hearing). Accordingly, the Court will not overturn the DLGF’s final determination on this basis.

II.

In the alternative, IndyGo claims that the DLGF’s final determination is not supported by the evidence because it “denied [the] 2007 [request] even though the computation methodology used by IndyGo was the same as the methodology implicitly approved by the [DLGF] for 2006.” (Pet’r Br. at 18-19.) (See also Pet’r Br. at 29 (arguing that the DLGF’s failure to provide any rational explanation for approving one appeal but denying the other “falls far short of [] due process requirements”).) The Court disagrees.

A final determination is not supported by the evidence if, in reviewing that evidence, the Court determines that a reasonable mind would not accept the evidence as adequate to support the conclusion at issue. Amax Inc. v. State Bd. of Tax Comm’rs, 552 N.E.2d 850, 852 (Ind. Tax Ct.1990). In reviewing the evidence contained in the administrative record, however, a reasonable mind would not conclude that the DLGF “approved” the methodology used by IndyGo to calculate its shortfall in budget year 2006. Indeed, the administrative record reveals that the DLGF subtracted the actual property tax collections in 2006 from the 2006 certified levy figure to determine that IndyGo suffered a property tax revenue shortfall for that year in the amount of $469,535. (See Cert. Admin. R. at 70-71, 126.) In its shortfall appeal for 2006, however, IndyGo only asked for $344,478. (Cert. Admin. R. at 1, 3.) Accordingly, the DLGF simply used IndyGo’s requested amount as its starting point and then reduced that amount by $125,479 to account for Indy-Go’s receipt of too much levy for budget year 2008. (See Cert. Admin. R. at 70-71, 75.) The Court is therefore not persuaded by IndyGo’s alternative argument.

CONCLUSION

Based on the foregoing reasons, the DLGF’s final determination is AFFIRMED.

      . IndyGo explained that the charges for these municipalities needed to be removed because IndyGo did not provide bus service within those taxing units and therefore could not collect property tax revenues from them. (See Cert. Admin. R. at 118-20.)

      . In other documentation submitted to the DLGF, IndyGo provided another calculation: it reduced IndyGo's listed general fund certified levy of $15,229,898 by an "actual distribution” number of $14,458,957 for a difference (i.e., shortfall) of $770,941. (Cert. Admin. R. at 4.)

      . Substantial evidence means " ‘such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.’ ” Amax Inc. v. State Bd. of Tax Comm'rs, 552 N.E.2d 850, 852 (Ind. Tax Ct.1990) (citation omitted).

      . IndyGo complains that the DLGF did not support its number with “better” evidence, but neither did IndyGo connect its $14,458,957 collections number to its shortfall calculation. (Cf. Cert. Admin. R. at 4 with 8-10.)

      . After it filed its original tax appeal, IndyGo attempted to use various methods of discovery to obtain information from the DLGF as to how it interpreted Indiana Code § 6 — 1.1— 18.5-16 as well as how it calculated its $15,315,394 collections number. (See Pet’r Br. at 3, 29.) IndyGo’s attempts, however, were too late. IndyGo needed to build and preserve its case during the administrative process.


text:
    BOARD OF COMMISSIONERS OF THE COUNTY OF JASPER, Indiana, Petitioner, v. Micah G. VINCENT, Commissioner, Indiana Department of Local Government Finance, Respondent.
    No. 49T10-1011-TA-59.
    Tax Court of Indiana.
    May 17, 2013.
    N. Kent Smith, Hall, Render, Killian, Heath & Lyman, P.C., Indianapolis, IN, Attorney for Petitioner.

      Gregory F. Zoeller, Attorney General of Indiana, John D. Snethen, Deputy Attorney General, Indianapolis, IN, Attorneys for Respondent.

      . The Court removes Brian E. Bailey from the caption and substitutes his successor Micah G. Vincent, who is the Commissioner of the Indiana Department of Local Government Finance, pursuant to Indiana Trial Rule 25. See Ind. Trial Rule 25(F).

   WENTWORTH, J.

This case concerns the Department of Local Government Finance’s (DLGF) determination that Indiana Code § 16-22-5-4 provides for the establishment of only one cumulative building fund and levy during the life of a county hospital. The Court finds it does not.

FACTS AND PROCEDURAL HISTORY

On June 7, 2010, the Jasper County Board of Commissioners issued a resolution seeking to establish a cumulative building fund and levy for enlarging, equipping, and remodeling the Jasper County Hospital. The Commissioners’ resolution requested that the Jasper County Council levy a tax, not to exceed $0,007 on each $100 of assessed value, on all taxable property within the county for up to three years. The Council subsequently approved the Commissioners’ request. On October 15, 2010, however, the DLGF denied the Commissioners’ request, and on November 29, 2010, the Commissioners initiated this original tax appeal. The Commissioners moved for summary judgment on June 1, 2011, and the Court held a hearing on September 28, 2011. Additional facts will be supplied as necessary.

STANDARD OF REVIEW

The Commissioners assert that the DLGF’s denial of its request to establish a cumulative building fund and levy under Indiana Code § 16-22-5-4 is arbitrary, capricious, and contrary to law. A final determination of the DLGF is arbitrary and capricious if it is “ ‘patently unreasonable’ and is ‘made without consideration of the facts and in total disregard of the circumstances and lacks any basis which might lead a reasonable person to the same conclusion.’ ” See Davis v. City of Kokomo, 919 N.E.2d 1213, 1222 (Ind.Ct.App.2010) (citation omitted). A final determination of the DLGF is contrary to law if it violates any statute, constitutional provision, legal principle, or rule of substantive or procedural law. See John Malone Enter., Inc. v. Schaeffer, 674 N.E.2d 599, 606 (Ind.Ct.App.1996).

ANALYSIS

Indiana Code § 16-22-5-4, the statute at issue in this case, states:

To provide for- the cumulative building fund, a tax on all taxable property within the county may be levied annually for not more than twelve (12) years and may not exceed eleven and sixty-seven hundredths cents ($0.1167) on each one hundred dollars ($100) of assessed valuation of property in the county.
lnd.Code § 16-22-5-4 (2010). The Commissioners contend that the plain language of Indiana Code § 16-22-5-4 does not limit the number of times a county hospital board may seek to establish a cumulative building fund and levy. (See Hr’g Tr. at 9-10; Pet’r Br. at 9.) They maintain that the absence of such a limitation is consistent with the purpose of the current and prior versions of this statutory scheme, which are all intended to fund the recurring events in the life of a county hospital building. (See Pet’r Reply Br. at 3-5; Pet’r Br. at 4-12.) See also Ind.Code § 16-22-5-8 (2010) (providing for the creation of a cumulative building fund in order to establish, enlarge, construct, acquire, equip, or remodel county hospital buildings). Thus, the Commissioners claim the DLGF’s interpretation that Indiana Code § 16-22-5-4 provides for only one cumulative building fund and levy during the service life of a county hospital is unreasonable. (See Pet’r Br. at 8, 12.)

The DLGF, however, contends that the specific phrase in the statute, “for not more than twelve (12) years,” means that a county may only establish one cumulative building fund and levy for up to 12 years, not that it may establish a new fund and levy every 12 years. (See Hr’g Tr. at 29; Resp’t Br. at 7, 9-10.) The DLGF argues that its interpretation supports the statute’s true purpose: funding large hospital projects rather than small, routine maintenance projects. (See Hr’g Tr. at 23-24; Resp’t Post Hr’g Br. at 6-8.)

When a statute is clear and unambiguous, the Court need not apply the rules of construction other than to require that its words and phrases be taken in their plain, ordinary, and usual sense. See City of Carmel v. Steele, 865 N.E.2d 612, 618 (Ind.2007). When a statute is susceptible to more than one interpretation, as it is here, it is ambiguous and other well-established rules of construction are applicable. See id. The Court’s primary goal in construing Indiana Code § 16-22-5-4 is to determine and implement the intent of the Legislature in enacting the statute. See DeKalb Cnty. E. Cmty. Sch. Dist. v. Dep’t of Local Gov’t Fin., 930 N.E.2d 1257, 1260 (Ind. Tax Ct.2010) (citation omitted). Thus, the Court must read the statute and related provisions as a whole, not piecemeal. See id. (citation omitted). Furthermore, because the Court presumes the Legislature intended Indiana Code § 16-22-5-4 be applied logically, it must read the statute in such a way as to prevent unjust or absurd results. See id. (citation omitted); Badawi v. Orth, 955 N.E.2d 849, 852 (Ind.Ct.App.2011) (citation omitted).

In ascertaining the Legislature’s intent, the Court may consider the history and development of Indiana Code § 16-22-5-4. See Sangralea Boys Fund, Inc. v. State Bd. of Tax Comm’rs, 686 N.E.2d 954, 957 (Ind. Tax Ct.1997) (citations omitted), review denied. As early as 1903, the General Assembly made clear that the predecessor to Indiana Code § 16-22-5 et seq. was intended to provide county hospital boards with the means to establish and maintain county hospitals. See 1903 Ind. Acts 167; see also, e.g., 1917 Ind. Acts 527. In 1953, the General Assembly, consistent with this purpose, established cumulative building funds:

The board of trustees of any county hospital organized and operating under the laws of the State of Indiana ... are authorized to provide a cumulative building fund to provide for the erection of hospital buildings and/or the erection of additions to and the remodeling of the present buildings used for hospital purposes and owned by the county in which such hospital is located.

1953 Ind. Acts 128-29 (emphasis added). At that time, the General Assembly also specified that:

[t]o provide for said cumulative building or remodeling fund the board of trustees of such county hospital shall have the power, with the approval of the county council, to levy annually for five years in any one period of ten consecutive years, a tax on all taxable property within the civil cities, towns and townships in such taxing district, but such levy by said county hospital shall not exceed two mills on the dollar of assessed valuation of property in such taxing district.

See 1953 Ind. Acts. 130 (emphases added). These two temporal restrictions provided for recurrent levies, but confined them to a “rolling” ten-year period that also included a five-year “no-levy” period. See id. In 1963, the General Assembly extended the “rolling” levy period to fifteen years and reduced the “no-levy” period to three years. See 1963 Ind. Acts. 303-04.

Then, in 1971, the General Assembly eliminated the “no-levy” period from the statute altogether:

To provide for such cumulative building fund, a tax on all taxable property within the county may be levied annually for a period not to exceed twelve (12) years, and such tax levy shall not exceed thirty-five cents (35c) on the one hundred dollars ($100.00) of assessed valuation of property in the county[.]

1971 Ind. Acts. 865 (emphasis added). Nothing within this statutory language indicates, however, that the elimination of the “no-levy” period imposed a limit on the number of times cumulative building funds and levies could be established.

In 1997, the General Assembly amended the statute again:

To provide for the cumulative building fund, a tax on all taxable property within the county may be levied annually for not more than twelve (12) years and may not exceed eleven and sixty-seven hundredths cents ($0.1167) on each one hundred dollars ($100) of assessed valuation of property in the county.

See 1997 Ind. Acts. 1084 (emphasis added). This version of the statute, which was in effect for 2010 (the year at issue in this case) changed the phrase “for a period not to exceed twelve (12) years” to the phrase “for not more than twelve (12) years[.]” Cf 1997 Ind. Acts. 1084 with 1971 Ind. Acts. 865. This amendment did not change the statute’s meaning, however, to newly allow just one cumulative fund and levy to be established in the life of a county hospital. Rather, the amendment merely clarified the General Assembly’s intent as first expressed in 1971: that any single cumulative building fund levy should not exceed twelve years. The statutory history of Indiana Code § 16-22-5-4, therefore, consistently articulates the intent to allow recurring cumulative building funds and levies, not to limit the number of funds and levies that may be established during the life of a county hospital.

Despite the statute’s underlying purpose, the DLGF offers three reasons why Indiana Code § 16-22-5-4 must be construed as allowing only a one-time, nonrenewable fund and levy. First, the DLGF claims that because other cumulative building fund statutes lack term limits entirely and use lower tax rates, the term limits and higher tax rates in Indiana Code § 16-22-5-4 necessarily create a one-time, non-renewable fund and levy. (See Hr’g Tr. at 23-24; Resp’t Br. at 8-10.) (See also Resp’t Post Hr’g Br. at 5-6, 8-10 (citing, e.g., Ind.Code § 36-8-14-4 (2010) (firefighting cumulative building funds); Ind.Code § 36-10-3-21 (2010) (park and recreations cumulative building funds); Ind.Code § 36-9-17.5-4 (2010) (local government transportation and public works cumulative building funds)).) The lack of term limits in the other cumulative building fund statutes, however, does not lead inexorably to the conclusion the DLGF urges. Instead, the lack of term limits in those statutes is more logically related to the statutes’ divergent purposes, differing procedures for establishment, or particular tax rates. Accordingly, attempting to harmonize Indiana Code § 16-22-5-4 with the other cumulative building fund statutes is inappropriate because the county hospital cumulative building fund statute does not concern the same subject or purpose as the other cumulative building fund statutes. See Lake Cnty. Assessor v. Amoco Sulfur Recovery Corp., 930 N.E.2d 1248, 1254-55 (Ind. Tax Ct.2010) (stating that courts should attempt to harmonize statutes that are in pan materia), review denied.

Next, the DLGF contends that because the county hospital cumulative building fund’s statutory scheme provides alternative financing options (i.e., bonds and loans), Indiana Code § 16-22-5^ must restrict county hospital cumulative building funds to one 12 year period. (See Resp’t Post Hr’g Br. at 6-7.) The availability of other financing options in Indiana Code § 16-22-5 et seq. does not support the DLGF’s interpretation; rather, the existence of alternative funding indicates an intent to provide flexibility to county hospitals for maintaining and updating their facilities, not to restrict them to one-time levies.

Finally, the DLGF claims its restrictive interpretation of the statute is correct because it protects taxpayers from the hardships of continually paying for large cumulative building fund levies. (See Hr’g Tr. at 24; Resp’t Br. at 9-10.) Nonetheless, this argument discounts or completely ignores the significant role county executives and fiscal bodies play in approving cumulative building fund levy requests as well as the important role taxpayers play in contesting new levies through a statutorily provided remonstrance process. See Ind. Code §§ 16-22-5-3 to -11 (2010). Consequently, none of the DLGF’s reasons persuade the Court that Indiana Code § 16-22-5-4 provides for a single fund and levy during the service life of a county hospital.

CONCLUSION

For the above-stated reasons, the DLGF’s denial of the Commissioners’ request to establish a cumulative building fund and levy under Indiana Code § 16-22-5-4 for the 2010 tax year is arbitrary, capricious, and contrary to law. Consequently, the Court REVERSES the DLGF’s final determination and REMANDS this matter for action consistent with this opinion.

      . While the Commissioners moved for summary judgment and designated evidence as support, they later determined that this matter need not be resolved by summary judg-mcnt. (See Hr’g Tr. at 6-8.) Therefore, the Court has considered only those facts that are supported by the certified administrative record.

      . The certified administrative record supports this conclusion because it demonstrates that the DLGF as well as its predecessor agency, the State Board of Tax Commissioners, approved at least five petitions to establish cumulative building funds and levies for the Jasper County Hospital between 1995 and 2009. (See Supp'l Cert. Admin. R. at 1-2; see also Pet’r Br. at 10-11.).

      . Indeed, market conditions may affect a county hospital’s decision whether to seek loans, issue and sell bonds, or request the establishment of cumulative building funds and levies.


author: DICKSON, Chief Justice. DAVID, Justice,

text:
    Sharon WRIGHT, and Leslie Wright, Appellants (Plaintiffs), v. Anthony E. MILLER, D.P.M., and Achilles Podiatry Group, Appellees (Defendants).
    No. 54S01-1207-CT-430.
    Supreme Court of Indiana.
    June 21, 2013.

      James E. Ayers, Wernle, Ristine & Ayers, Crawfordsville, IN, Attorney for Appellant.
    Peter H. Pogue, Julia Abbott Condict, Schultz & Pogue, LLP, Indianapolis, IN, Attorneys for Appellee.
   DICKSON, Chief Justice.

Plaintiffs Sharon and Leslie Wright appeal the striking of their expert witness and the dismissal of their medical malpractice claim against Dr. Anthony Miller and Achilles Podiatry Group pursuant to Trial Rules 37(B) and 41(E). We reverse.

In April and June of 2004, Dr. Miller performed surgeries on Mrs. Wright’s left and right feet, respectively. The surgeries, the plaintiffs contend, produced injurious results. They further argue that the second surgery was performed without full consent. In April of 2006, the plaintiffs filed a malpractice claim with the Indiana Department of Insurance and, in December of 2008, the review panel found in favor of the defendants.

In response to the plaintiffs’ ensuing action for damages, the defendants sought summary judgment on the grounds that the plaintiffs had not produced an expert opinion to refute the conclusion of the medical review panel. The plaintiffs responded with an affidavit from Dr. Franklin Nash supporting their claim, and the defendants withdrew their motion for summary judgment. During the course of discovery, the plaintiffs failed to include Dr. Nash on any witness list submitted to the court, either preliminary or final. However, in response to interrogatories from the defendants, the plaintiffs specified that they had no expert witness other than Dr. Nash. Other discovery requests from the defendants pertained specifically to Dr. Nash. The pleadings thus establish that the defendants were aware that Dr. Nash was the plaintiffs’ designated expert.

At a pretrial conference on August 17, 2009, the trial court established specific discovery deadlines with all discovery to be concluded by July 28, 2010, and set the trial for August 24, 2010. In addition to the failure to include Dr. Nash on their witness, lists submitted to the trial court, the plaintiffs failed to meet other deadlines imposed by the court, including: preliminary witness list (three days late), final witness list (eleven days late), statement of contentions (twenty-four days late), and final proposed jury instructions (ten days late). On July 28, 2010, the deadline for concluding discovery, the plaintiffs filed a motion to continue the trial date, contending that they needed more time to supplement their discovery responses. The trial court never ruled on the motion because on August 4, 2010, twenty days before the date set for trial, the plaintiffs filed a second motion to continue the trial because Dr. Nash had been hospitalized. The nature of Dr. Nash’s illness prevented him from participating in the trial, and the plaintiffs thus requested time to acquire a new expert witness. The trial court granted the motion, reset the discovery deadline for December 24, 2010, and set a status conference for January 10, 2011, at which time a new trial date would be determined.

The plaintiffs unsuccessfully attempted to secure Mrs. Wright’s treating physician as an expert witness. Then, in November of 2010, the plaintiffs contacted a referral service. The referral service did not identify a potential expert witness until December 17, 2010, and that witness did not confirm his willingness to testify until January 9, 2011, well after the December 24 discovery deadline and one day before the scheduled status conference.

On January 7, 2011, the defendants filed a motion to dismiss on the grounds that the plaintiffs failed to comply with the discovery deadline and for lack of evidence (specifically, no expert witness to rebut the findings of the medical review panel). On January 10, 2011, the day of the status conference, the plaintiffs filed a notice of a new expert witness, and the defendants moved to strike the notice as untimely. After the parties submitted briefing on the motions, the trial court ruled in favor of the defendants and dismissed the case. The trial court’s rationale was explained in the concluding paragraph of its judgment:

Plaintiffs’ refusal to meet the Court’s deadlines causes the Plaintiffs’ case to lack the requisite expert testimony required by Indiana law and therefore, the Defendants’ Motion to Dismiss should be granted. In accordance with this decision, the Defendants’ Motion to Strike Plaintiffs’ Untimely Notice of Expert Witness should be granted.

Order Granting Defendants’ Motion to Dismiss, Appellants’ Am. App’x at 361 (emphasis added).

On appeal, the plaintiffs contend that the trial court erred in excluding their expert witness and thereby dismissing their claims. The Court of Appeals agreed and reversed the trial court. Wright v. Miller, 965 N.E.2d 135 (Ind.Ct.App.2012). We granted transfer, and while we come to the same result as the Court of Appeals, we arrive by a somewhat different path.

1. Enforcing Discovery and Trial Court Management Orders

Indiana’s trial courts decide over 1.5 million cases per year statewide, and have done so consistently for the past decade. 1 Ind. Jud. Serv. Rep. 2011: Jud. Year Rev. 97 (2012). Managing such a heavy volume demands robust court docket management and insistence upon compliance with the discovery rules, which are specifically intended to minimize the need for judicial involvement. “A trial judge has the responsibility to direct the trial in a manner that facilitates the ascertainment of truth, ensures fairness, and obtains economy of time and effort commensurate with the rights of [the parties].” VanWay v. State, 541 N.E.2d 523, 526 (Ind.1989); see also Wiseheart v. State, 491 N.E.2d 985, 990 (Ind.1986) (“[A party’s] interest in the application of discovery rules is the prevention of surprise, not punishment of the [opponent] for mere technical errors or omissions. In accordance with these ends, the trial court should seek to apply sanctions which have a minimal [e]ffect on the evidence presented at trial and the merits of the case.” (citation omitted)). “Although ‘concealment and gamesmanship were [once] accepted as part and parcel of the adversarial process,’ we have unanimously declared that such tactics no longer have any place in our system of justice.” Whitaker v. Becker, 960 N.E.2d 111, 115 (Ind.2012) (alteration in original) (quoting Outback Steakhouse of Fla. Inc. v. Markley, 856 N.E.2d 65, 77 (Ind.2006) (citation omitted)). “Trial judges stand much closer than an appellate court to the currents of litigation pending before them, and they have a correspondingly better sense of which sanctions will adequately protect the litigants in any given case[.]” Id.

Indiana Trial Rules 37 and 41 each provide the trial court with mechanisms to ensure compliance with the trial rules and obedience to its orders. Whitaker, 960 N.E.2d at 115; Rumfelt v. Himes, 438 N.E.2d 980, 982 (Ind.1982). Trial Rule 37 provides broad latitude for the trial court to impose sanctions to ensure cooperative discovery, and thus encompasses remedies which may be sought by or imposed against either party. See Ind. Trial Rule 37 (“Failure to make or cooperate in discovery: Sanctions”). Trial Rule 37(B) permits the trial court to “make such orders ... as are just,” including “treating as a contempt of court the failure to obey,” “prohibiting [the disobedient party] from introducing designated matters into evidence,” “dismissing the action or proceeding or any part thereof, or rendering a judgment by default against the disobedient party” when that party “fails to obey an order to provide or permit discovery.” T.R. 37(B). In contrast, Trial Rule 41 specifically addresses only dismissal, and thus primarily provides protections and remedies for the benefit of a defendant. See T.R. 41 (“Dismissal of actions”). Trial Rule 41(E) states, in pertinent part:

Whenever there has been a failure to comply with [the trial] rules or when no action has been taken in a civil case for a period of sixty [60] days, the court, on motion of a party or on its own motion shall order a hearing for the purpose of dismissing such case. The court shall enter an order of dismissal at plaintiffs costs if the plaintiff shall not show sufficient cause at or before such hearing.

T.R. 41(E). Thus, where the sanction imposed for discovery violations is dismissal, some overlap in the applicability of Trial Rules 37 and 41 may occur. See, e.g., Benton v. Moore, 622 N.E.2d 1002, 1006 (Ind.Ct.App.1993) (“In addition to violations of the trial rules themselves, this provision applies equally well to orders of the court entered pursuant to the trial rules, including pre-trial orders issued under [Indiana] Trial Rule 16.” (citation omitted)), trans. not sought,

And while the trial courts generally “fashion progressive sanctions leading up to a dismissal or default judgment when it is possible to do so, imposing intermediate sanctions is not obligatory when a party’s behavior is particularly egregious.” Whitaker, 960 N.E.2d at 116; see also City of Gary v. Major, 822 N.E.2d 165, 169 (Ind.2005) (“[A]mong the inherent powers of a court is that of maintaining its dignity, securing obedience to its process and rules, rebuking interference with the conduct of business, and punishing unseemly behavior.”); Prime Mortg. USA, Inc. v. Nichols, 885 N.E.2d 628, 649 (Ind.Ct.App.2008) (quoting Chamas v. Estate of Loizos, 822 N.E.2d 181, 185 (Ind.Ct.App.2005), trans. not sought) (“In determining whether a sanction is just, we recognize that ‘[a]lthough a default judgment plays an important role in the maintenance of an orderly, efficient judicial system as a weapon for enforcing compliance with the rules of procedure and for facilitating the speedy determination of litigation, in Indiana there is a marked judicial deference for deciding disputes on their merits and for giving parties their day in court, especially in cases involving material issues of fact, substantial amounts of money, or weighty policy determinations.’ ” (alteration in original)), trans. not sought. Additionally, we caution against an overly formulaic approach to determining when the behavior of a party or counsel warrants the drastic sanction of dismissal.

We previously addressed the exclusion of a witness as a discovery sanction in the criminal context in Wiseheart v. State, where the trial court excluded four defense witnesses whom the defense did not disclose during discovery. Wiseheart, 491 N.E.2d at 987-88. In reversing, we stated that “the primary factors which a trial court should examine are whether the breach was intentional or in bad faith and whether substantial prejudice has resulted.” Id. at 988. Because, in the criminal context, the exclusion of defense witnesses raises Sixth Amendment concerns, see U.S. Const, amend. VI (“In all criminal prosecutions, the accused shall enjoy the right ... to have compulsory process for obtaining witnesses in his favor .... ”), we articulated a nonexclusive list of factors from which trial courts should evaluate the exclusion of witnesses for discovery violations. Id. at 991.

In order to reach a just decision which fully assess[es] the right of both parties to a fair trial and the criminal defendant’s Sixth Amendment right to present witnesses on his behalf, the following kinds of questions should be asked:
(1) Whether the nature of defendant’s violation was trivial or substantial. The trial court should consider when the witness first became known to defense counsel.
(2) How vital the potential witness’ testimony is to the defendant’s case. The trial court should determine the significance of the proffered testimony to the defense. Is the testimony relevant and material to the defense or merely cumulative?
(3) The nature of the prejudice to the State. Does the violation have a deleterious impact on the ease prepared by the State?
(4) Whether less stringent sanctions are appropriate and effective to protect the interest of both the defendant and the State.
(5) Whether the State will be unduly surprised and prejudiced by the inclusion of the witness’ testimony despite the available and reasonable alternative sanctions (e.g., a recess or a continuance) which can mitigate prejudice to the State by permitting the State to interview the witnesses and conduct further investigation, if necessary.

Id. (footnote omitted). The Court of Appeals later applied Wiseheart in its review of a civil lawsuit. Davidson v. Perron, 756 N.E.2d 1007, 1013-14 (Ind.Ct.App.2001), trans. not sought; see also Carter v. Robinson, 977 N.E.2d 448, 455-56 (Ind.Ct.App.2012) (applying the Davidson adaptation of Wiseheart), trans. denied.

We agree that the Wiseheart factors can be a valuable guide in civil cases but caution against a formulaic application of these factors which deemphasizes the general discretion of the trial court. As we stated in Wiseheart, “It may well be that other factors will be relevant in a given case or that some of the foregoing will be inapplicable to a certain set of facts.” Wiseheart, 491 N.E.2d at 991. “Trial judges stand much closer than an appellate court to the currents of litigation pending before them, and they have a correspondingly better sense of which sanctions will adequately protect the litigants in any given case,” Whitaker, 960 N.E.2d at 115, and likewise what sanctions are appropriate toward “maintaining its dignity, securing obedience to its process and rules, rebuking interference with the conduct of business, and punishing unseemly behavior,” Major, 822 N.E.2d at 169. Yet, in exercising this inherent power, “the trial court should seek to apply sanctions which have a minimal [ejffect on the evidence presented at trial and the merits of the case,” Wiseheart, 491 N.E.2d at 990, keeping in mind “that sanctions should not be imposed when circumstances make sanctions unjust,” Outback Steakhouse, 856 N.E.2d at 82 (citing T.R. 37(D)); see also T.R. 37(B) (“If a party ... fails to obey an order to provide or permit discovery ... the court in which the action is pending may make such orders in regard to the failure as are just[.]”).

When the offending conduct is primarily attributable to counsel and not the client, and prejudice to the opposing party is slight, due consideration should be given to sanctions directed primarily at counsel which seek to minimize prejudice to the client and the merits of the case, while appropriately incentivizing proper future behavior of counsel. See, e.g., Outback Steakhouse, 856 N.E.2d at 82 (denying defendants’ request for sanctions against plaintiffs where conduct was attributable only to counsel, but withholding judgment on possible future sanctions against offending counsel). And while imposing intermediate sanctions leading up to dismissal “is not obligatory when a party’s behavior is particularly egregious,” Whitaker, 960 N.E.2d at 116, this is primarily so when a party’s behavior is so prejudicial to the rights of the opponent that any lesser sanction would be inadequate. Prime Mortg. USA, 885 N.E.2d at 649; see, e.g., Whitaker, 960 N.E.2d at 116-17 (upholding dismissal where counsel delayed and then provided false and misleading discovery answers regarding a medical procedure that pertained directly to the merits of the case).

When challenged on appeal, trial court sanctions for failure to comply with court orders are reviewed for an abuse of discretion. McCullough v. Archbold Ladder Co., 605 N.E.2d 175, 180 (Ind.1993). We presume that the trial court will “act in accord with what is fair and equitable in each case,” and thus we will only reverse “if the trial court’s decision is clearly against the logic and effect of the facts and circumstances before the court, or if the trial court has misinterpreted the law.” Id. The conduct and equities will vary with each case, and we thus generally leave that determination to the sound discretion of the trial courts.

In the present case, we discern from the trial court’s order of judgment and order denying the plaintiffs’ motion to correct error that the court’s decision to dismiss was predicated upon its determination excluding the plaintiffs’ expert witness. It was the court’s decision to exclude the witness that resulted from plaintiffs’ counsel’s persistent disregard and violation of the court’s discovery and case management orders. For this reason, we will first address the propriety of the trial court’s exclusion of the plaintiffs’ expert witness. Then we will address the trial court’s resulting dismissal decision.

2. Exclusion of Plaintiffs’ Expert Witness

Applying the above principles, we find that the exclusion of the expert witness was inconsistent with the logic and effect of the facts and circumstances before the court. There is no question that the plaintiffs’ counsel failed to include their original expert witness, Dr. Nash, on any witness list. However, it is also clear that the defendants were well aware that the plaintiffs intended Dr. Nash to be the expert witness at trial. See, e.g., Trial Court Order, Aug. 16, 2010, Appellants’ Am. App’x at 308 (vacating trial date and extending discovery) (“The defendants’ position that plaintiffs have failed to formally designate Nash as their expert witness notwithstanding, the Court finds that his testifying at trial was anticipated by both plaintiffs and defendants.”). Furthermore, the delay of the trial was not primarily necessitated by the substandard conduct of the plaintiffs’ counsel, but rather by the unavailability of Dr. Nash due to health concerns, an event presumably beyond the control of the plaintiffs or their counsel.

While we critically view counsel’s haphazard and disrespectful pattern of inattention to or disregard of the trial court’s management and discovery orders and deadlines, the prejudice to the defendants was minimal. They were well aware that the plaintiffs were attempting to secure a new expert witness and that the witness would need to be deposed. As of the date of the status conference, when the plaintiffs’ new expert witness was disclosed, no new trial date had been set. Certainly the trial court would have provided the defendants time to prepare to confront the plaintiffs’ new witness at trial. The late disclosure was thus neither a surprise nor would it have had a deleterious or significantly prejudicial effect on the defendants’ case. The prejudice to the defendants was little greater than that which is to be expected in suits of this nature. In contrast, as demonstrated by the trial court’s conclusion that the exclusion required dismissal, the exclusion of the plaintiffs’ expert would have had a substantial effect on their ability to present the merits of their case. We find that the exclusion of the plaintiffs’ expert witness was inconsistent with the trial court’s duty to “seek to apply sanctions which have a minimal [ejffect on the evidence presented at trial and the merits of the case.” Wiseheart, 491 N.E.2d at 990; see also Outback Steakhouse, 856 N.E.2d at 82.

We continue to recognize the trial court’s inherent powers in “maintaining its dignity, securing obedience to its process and rules, rebuking interference with the conduct of business, and punishing unseemly behavior,” Major, 822 N.E.2d at 169, and we encourage trial judges to actively oversee and manage the cases pending before them. The use and enforcement of case management orders and deadlines are essential to sound judicial administration. But we conclude that the circumstances of the present case warranted some lesser, preliminary, or more pointed sanction fashioned to address counsel’s unsatisfactory conduct in this case without depriving the plaintiffs of their ability to present the merits of their case at trial. Accordingly, we hold that the trial court’s exclusion of the plaintiffs’ expert witness was inconsistent with the logic and effect of the facts and circumstances presented.

3. Dismissal of the Plaintiffs’ Action

As noted above, the trial court’s order of dismissal was directly grounded upon its decision to exclude the plaintiffs’ expert witness for violation of discovery deadlines and its belief that the plaintiffs could not establish their case without such witness. Because we have concluded that such witness exclusion was erroneous, the basis for the resulting case dismissal evaporates and the granting of the defendants’ motion to dismiss was likewise erroneous.

Conclusion

We reverse the trial court’s order of judgment granting the defendants’ motions to strike the plaintiffs’ expert witness and to dismiss this action. These motions should have been denied. This cause is remanded for further proceedings.

RUCKER, MASSA, and RUSH, JJ., concur.

DAVID, J., concurs in part and dissents in part with separate opinion.

DAVID, Justice,

concurring in part and dissenting in part.

I concur in that portion of the majority opinion reversing dismissal of this case pursuant to the Indiana Rules' of Trial Procedure. I agree that it was an abuse of discretion to dismiss the case entirely under the circumstances presented here. I also concur that a formulaic adherence to the factors from Wiseheart v. State, 491 N.E.2d 985 (Ind.1986), diminishes the discretionary authority of the trial court judge to manage and maintain the dignity, business, and process of the court.

Nevertheless, I cannot concur with the subsequent reversal of the trial court’s decision to exclude Wright’s expert witness. Without seeking to enter the unsettled arena of whether such an expert witness is required in this type of case, I not only believe the exclusion was an appropriate exercise of the trial court’s discretion here, but I struggle to find a more appropriate sanction with which the trial court could have enforced its discovery deadlines and orders when Wright repeatedly failed to include Dr. Nash on her witness lists, filed those witness lists late (along with other delayed filings), and then failed to meet a discovery deadline that had already been extended at her request.

While this may not have prejudiced Dr. Miller to the point th.at dismissal of the action entirely was appropriate, to me it demonstrates a patterned lack of regard for the Trial Rules and the trial court’s authority, much less the successful pursuit of Wright’s own case. Accordingly, I would find no abuse of discretion in striking Wright’s expert witness and therefore respectfully dissent.

      . The plaintiffs contend that Mrs. Wright consented only to the removal of a bunion on her right foot. The defendants contend that Mrs. Wright consented to several procedures amounting to a significant reconstruction of the foot, similar to that previously performed on her left foot.

      . The plaintiffs also objected to and, consequently, did not comply with several of the defendants’ interrogatories and requests for production of documents. The defendants filed a motion to compel discovery, and the plaintiffs filed two separate motions for a protective order. It appears from the record that the trial court never ruled on any of these motions.

      . We note that the trial court did not order or hold a hearing to dismiss as required by Trial Rule 41(E). See Rumfelt, 438 N.E.2d at 984. Although the absence of a hearing is not determinative in this case, in light of the gravity of the sanction of dismissal, we believe that the hearing required by Trial Rule 41(E) should henceforth likewise be held when a case dismissal is sought or contemplated under Trial Rule 37.

      . The Court of Appeals has consistently applied a factor analysis to dismissals under Trial Rule 41(E) for failure to prosecute. See Belcaster v. Miller, 785 N.E.2d 1164, 1167 (Ind.Ct.App.2003) (citing Lee v. Friedman, 637 N.E.2d 1318, 1320 (Ind.Ct.App.1994), trans. not sought) ("Courts of review generally balance several factors when determining whether a trial court abused its discretion in dismissing a case for failure to prosecute.”), trans. denied. Because the trial court dismissed the plaintiffs’ claim for "failure to comply with the Indiana Trial Rules,” Order Denying Plaintiffs’ Motion to Correct Errors, Appellants’ Am. App’x at 463, and not for a failure to prosecute, that factor analysis is inapplicable to this case.

      .The witnesses apparently did not approach defense counsel until the morning of the first day of trial. Wiseheart, 491 N.E.2d at 987.

      . We have had little occasion to address the exclusion of a witness as a discovery sanction in the civil context. See McCullough v. Archbold Ladder Co., 605 N.E.2d 175, 181 (Ind. 1993) ("Had the rule concerning disclosure of rebuttal witnesses been clearly established in Indiana, the trial court could properly have excluded Sobek’s testimony. Several factors convince us that under these circumstances, however, exclusion of Sobek was too harsh a penalty."); see also Outback Steakhouse, 856 N.E.2d at 82 ("Rule 37 authorizes imposition of sanctions, including exclusion of evidence and attorney fees, for a party's failure to respond to interrogatories. However, the Rule appropriately provides that sanctions should not be imposed when circumstances make sanctions unjust. T.R. 37(D). There is no evidence the Markleys were involved in the discovery violations. Both exclusion of Roys-don’s testimony at any subsequent proceedings and an order compelling the Markleys to pay Outback’s attorney fees would punish the Markleys for their counsel's conduct.”).

      . In its opinion in this case, the Court of Appeals adopted an eleven-factor balancing test (which included the Wiseheart factors). Wright, 965 N.E.2d at 145. The court gleaned these factors from past cases. Id. at 145-47. We find the court’s thorough review to be illustrative of the case-by-case variance in facts and conduct and thus the need for a broad discretionary power at the trial court. Accordingly, we decline to adopt such a prescriptive analysis.

      . We recognize that a trial court's past experience with a particular attorney's pattern of dilatory, evasive, or inattentive conduct may be considered. In the present case, the record does not indicate that the trial judge's past experiences with this plaintiffs’ counsel in other cases were a factor considered by the trial court. When such attorney malfeasance is repeatedly observed, referral to the Disciplinary Commission may be appropriate.


author: DICKSON, Chief Justice.

text:
    Erving SANDERS, Appellant (Defendant), v. STATE of Indiana, Appellee (Plaintiff).
    No. 49S02-1304-CR-242.
    Supreme Court of Indiana.
    June 25, 2013.
    Rehearing Denied Sept. 24, 2013.

      Ellen M. O’Connor, Marion County Public Defender Agency, Attorney for Appellant.
    Gregory F. Zoeller, Attorney General of Indiana, George P. Sherman, Deputy Attorney General, Indianapolis, IN, Attorneys for Appellee.
   DICKSON, Chief Justice.

The defendant, facing charges of Possession of Cocaine, a class D felony, has brought this interlocutory appeal from the trial court’s denial of his motion to suppress evidence obtained following a traffic stop. Concluding that the motion should have been granted, the Court of Appeals reversed. Sanders v. State, 981 N.E.2d 616, 623 (Ind.Ct.App.2013). We granted transfer and now affirm the trial court.

In the late afternoon of January 28, 2011, the defendant was driving a 1991 Chevrolet Suburban vehicle with tinted rear side and back windows when an Indianapolis Metropolitan Police Department officer initiated a traffic stop. Approaching the driver’s side window, the officer directed the defendant to roll down the window and informed him of the reason for the stop — his belief that the tinted windows were so dark as to constitute a traffic infraction. At this time, the officer smelled marijuana. The officer asked the defendant about the smell, to which the defendant replied that he had “just smoked a joint.” The officer then returned to his patrol car to verify the defendant’s driver’s license and request backup. When an assisting officer arrived at the scene, the officer requested that the defendant step out of the car, conducted a search of the defendant’s person, and retrieved a plastic bag containing a white substance. When the officer questioned the defendant about the substance, asking if it was heroin, the defendant replied in the negative, stating that it was cocaine. At that point, the officer placed the defendant under arrest and took him into custody. Several photographs of the vehicle were taken by an evidence technician roughly one hour after the initial stop; these photographs were admitted in evidence at the subsequent evidentiary hearing.

On January 28, 2011, the State charged the defendant with class D felony Possession of Cocaine. On May 4, 2011, the defendant filed a Motion to Suppress, claiming that the evidence obtained by the officer’s search was “a result of illegal actions by the police officers involved,” most notably, “the lack of probable cause to stop” the defendant and to search his person. Motion to Suppress, Appellant’s App’x at 24. The trial court held eviden-tiary hearings on the motion on May 4 and June 1, 2011. In July 2011, the defendant filed, and the trial court granted, a motion to allow an expert to view the automobile to measure the tint of the windows, which was found to be legally within the statutorily defined limits. Notwithstanding these findings, the court ultimately denied the defendant’s motion, finding that an officer’s good faith subjective belief of violation of a traffic law is enough to justify the initial stop, even if it is later found that the traffic law has not in fact been violated.

On interlocutory appeal, claiming violation of the Fourth Amendment, U.S. Const, amend. IV, the defendant asserted that the officer’s “subjective interpretation of identity and tint did not justify his traffic stop of [the defendant’s] Chevy Suburban, which objectively complied with Indiana’s Window Tint Statute. His mistaken application of the statute did not justify a good faith exception to uphold the stop.... ” Appellant’s Br. at 8. The Court of Appeals, agreeing with the defendant, reversed the ruling of the trial court, finding that there was no “objectively justifiable reason for the stop of the vehicle.” Sanders, 981 N.E.2d at 623. We granted transfer, thereby automatically vacating the opinion of the Court of Appeals, Ind. Appellate Rule 58(A), and thus consider this appeal anew.

We review a trial court’s denial of a motion to suppress in a manner similar to review of other sufficiency issues. Taylor v. State, 689 N.E.2d 699, 702 (Ind.1997). There must be substantial evidence of probative value in the record to support the ruling of the trial court. Id. We do not reweigh the evidence, and we consider conflicting evidence most favorably to the trial court’s ruling. Id. We review de novo the determination of reasonable suspicion for a warrantless search. Myers v. State, 839 N.E.2d 1154, 1160 (Ind.2005) (citing Ornelas v. United States, 517 U.S. 690, 694-700, 116 S.Ct. 1657, 1660-64, 134 L.Ed.2d 911, 917-21 (1996)).

The defendant’s primary argument is that the initial traffic stop made by the officer was unjustified because the officer’s belief that the window tint on the defendant’s rear side and back windows violated the Indiana Window Tint Statute was later invalidated through inspection of the vehicle by the defendant’s expert. Because the tint objectively complied with the Window Tint Statute, the defendant argues, the officer’s “subjective interpretation of identity and tint did not justify his traffic stop.” Appellant’s Br. at 8 (emphasis added). Therefore, the defendant claims, any evidence seized through the subsequent search of the defendant’s person is the product of a pretextual investigatory stop in violation of the Fourth Amendment.

The Fourth Amendment protects individuals against unreasonable searches and seizures, so that they may “be secure in their persons, houses, papers, and effects.” U.S. Const, amend. IV. This protection has been extended to the states through the Fourteenth Amendment. Mapp v. Ohio, 367 U.S. 643, 650, 81 S.Ct. 1684, 1689, 6 L.Ed.2d 1081, 1087 (1961). The Fourth Amendment generally prohibits a warrantless search unless a valid exception to the warrant requirement exists. Berry v. State, 704 N.E.2d 462, 465 (1998). Probable cause is a recognized exception. Id. (citing Robles v. State, 510 N.E.2d 660, 664 (Ind.1987)). Further, a traffic stop and limited search is permissible where an officer has at least reasonable suspicion that a traffic law, or other law, has been violated. Id.; see also Meredith v. State, 906 N.E.2d 867, 869 (Ind.2009).

The Indiana Window Tint Statute prohibits operation of a motor vehicle that has windows tinted in such a way that “the occupants of the vehicle cannot be easily identified or recognized through [those] window[s] from outside the vehicle.” Ind. Code § 9-19-19-4(c). It is an affirmative defense if the solar reflectance of visible light is not more than 25% and the light transmittance is at least 30%. Id. Here, the officer testified that he initiated a traffic stop of the defendant’s vehicle based on his perception that the tint of the vehicle’s windows was so dark that he could not “clearly recognize or identify the occupant inside.” Tr. at 6. However, the defendant’s expert later testified that the tinted windows had a light transmittance of 38%, id. at 80, within the legal range. Such proof of compliance with the Window Tint Statute undoubtedly relieves the defendant of any liability for a window tint violation. However, it does not serve to vitiate the legality of the traffic stop. The officer’s belief, based on the fact that he could not “clearly recognize or identify the occupant inside,” id. at 6, that the window tint violated the Window Tint Statute, coupled with the fact that the actual tint closely borders the statutory limit, leads us to conclude that the officer had reasonable suspicion to make the initial stop. Considering this testimony in the light most favorable to the trial court’s ruling, as we must, the evidence clearly supports the ruling of the trial court.

The defendant also contends that the initial traffic stop was invalid under Indiana Code Section 34-28-5-3, which authorizes a law enforcement officer to detain an individual for a limited time if the officer “believes in good faith that a person has committed an infraction or ordinance violation.” Ind.Code § 34-28-5-3. The defendant argues that the officer’s belief that the defendant had committed a violation of the Window Tint Statute was not in good faith because, after subsequent testing, the defendant’s window tint was found to be in compliance with the statute. Appellant’s Br. at 10 (citing Ransom v. State, 741 N.E.2d 419, 422 (Ind.Ct.App.2000) (“[A]n officer’s mistaken belief about what constitutes a violation does not amount to good faith. Such discretion is not constitutionally permissible.”)). We disagree. In Ransom, an individual was driving along a narrow street when he encountered an approaching police vehicle. Recognizing that both vehicles could not pass simultaneously, the driver put his vehicle in reverse and backed around the corner. The officer stopped the driver’s vehicle for “operating in reverse,” and subsequently discovered a handgun. The court found that “operating in reverse” was an infraction which did not exist at law and that the driver’s behavior was not in violation of the reckless driving statute or any other state law. Thus, the court held, the officer “did not have an objectively justifiable reason for stopping [the driver],” and the traffic stop was not lawful. Ransom, 741 N.E.2d at 422.

This case is easily distinguished from Ransom because here, the apparent infraction for which the defendant’s vehicle was initially stopped does in fact exist at law. Although the officer was ultimately mistaken in his belief that a violation occurred, the traffic stop was based upon a good faith, reasonable belief that a statutory infraction had occurred and thus we are unable to say that the traffic stop was not lawful.

Conclusion

We hold that the officer had reasonable suspicion that the tint on the windows of the defendant’s vehicle was in violation of the Window Tint Statute such that the initial stop was justified. At the initial stop, the officer smelled marijuana, which provided probable cause to search the defendant’s person. The search of the defendant’s person revealed a bag of cocaine, the evidence at issue in this case. Because the evidence was obtained as a result of a fully justified and legal search, the trial court was correct in denying the defendant’s motion to suppress. We hereby affirm the ruling of the trial court.

RUCKER, DAVID, MASSA, and RUSH, JJ., concur.

      . The defendant disputes this fact, claiming that the officer asked, "do you smoke marijuana?” and the defendant replied "No.” Appellant's Br. at 5.

      . The defendant makes no Indiana constitutional claims, relying wholly on the United States Constitution.

      . Indiana Code Section 9-19-19-4(c) provides:
      A person may not drive a motor vehicle that has a:
      (1) windshield;
      (2) side wing;
      (3) side window that is part of a front door; or
      (4) rear back window;
      that is covered by or treated with sun-screening material or is tinted to the extent or manufactured in a way that the occupants of the vehicle cannot be easily identified or recognized through that window from outside the vehicle. However, it is a defense if the sunscreening material applied to those windows has a total solar reflectance of visible light of not more than twenty-five percent (25%) as measured on the nonfilm side and light transmittance of at least thirty percent (30%) in the visible light range.