Carole Storch, as Personal Representative for the Estate of Charles Sindledecker v. Provision Living, LLC PVL Tenant Holdings, LLC, d/b/a Greentree at Fort Harrison

Dec 23 2015, 10:11 am

ATTORNEYS FOR APPELLANT ATTORNEYS FOR APPELLEES
Arend J. Abel Janet A. McSharar
Jeffrey A. Hammond Jennifer L. Strange
Cohen and Malad, LLP Drewry Simmons Vornehm, LLP
Indianapolis, Indiana Carmel, Indiana

IN THE
COURT OF APPEALS OF INDIANA

Carole Storch, as Personal December 23, 2015
Representative for the Estate of Court of Appeals Case No.
Charles Sindledecker, 49A02-1505-CT-352
Appellant-Plaintiff, Appeal from the Marion Superior
Court
v. The Honorable Heather Welch,
Special Judge
Provision Living, LLC; PVL Trial Court Cause No.
Tenant Holdings, LLC, d/b/a 49D01-1201-CT-2695
Greentree at Fort Harrison,
Appellees-Defendants

Baker, Judge.

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[1] Carol Storch appeals the judgment of the trial court holding that her father’s

estate is not entitled to an award of attorney fees pursuant to a residence

agreement entered into between her father and his assisted living facility.

Finding that the plain language of the residence agreement compels an award of

attorney fees in this case, we reverse.

Facts
[2] The defendants operate an assisted living facility in Indianapolis by the name of

Greentree at Fort Harrison (Greentree). In 2006, Charles Sindledecker, who

was suffering from Alzheimer’s disease and was no longer able to care for

himself, entered into a residence agreement with Greentree. The agreement

contained a clause regarding attorney fees:

In the event of any controversy, claim, or dispute between the
parties hereto, arising out of or relating to this Agreement or the
breach thereof, the prevailing party shall be entitled to recover
from the other party reasonable expenses, costs, and attorney’s
fees.

Appellant’s App. p. 58. The contract also made clear that Sindledecker would

have to maintain his own health care plan and that Greentree was not

responsible for providing medical services. Id. at 56.

[3] While residing at Greentree, Sindledecker enjoyed spending time sitting in a

chair by the fireplace in the common room. He sat in this chair for long periods

of time nearly every day. As his dementia worsened, he became angry when he

found other residents sitting in the chair. Greentree responded by removing the

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 chair from the common room altogether. Sindledecker, however, enjoyed

being by the fireplace regardless, and began standing, or sitting on his walker,

near where the chair used to be. Realizing the danger this posed, Greentree

staff would often move Sindledecker farther away from the fireplace.

[4] On December 10, 2010, Greentree staff found Sindledecker unresponsive on the

floor by the fireplace and called 911. As they waited for the ambulance to

arrive, the staff took Sindledecker back to his room and began changing his

clothes. When the ambulance arrived, the staff informed the paramedics that

Sindledecker had been found unresponsive “at a recreational activity.”

Appellant’s App. p. 141. The paramedics took Sindledecker to the hospital,

checked his vital signs, and discharged him.

[5] Sindledecker’s right arm had been badly burned as a result of this incident and

his condition worsened over the next two days. Greentree staff again called

911, and this time informed the paramedics that Sindledecker had fallen near a

fireplace and suffered burns. Sindledecker was taken back to the hospital,

where he remained for ten days while the burns were treated. He eventually

required a skin graft and his wounds did not heal until April 2011.

Sindledecker never regained the mobility he had before the fireplace incident—

he remained unable to walk and required a feeding tube and catheter. He died

on August 10, 2012.

[6] Sindledecker’s daughter, Carole Storch, had filed a complaint against Greentree

on her father’s behalf on January 23, 2012. The complaint included claims of

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 breach of contract and negligence regarding the fireplace incident. On January

2, 2015, less than two weeks before trial was scheduled to begin, Storch

voluntarily dismissed the breach of contract claim. The negligence claim was

tried to a jury, which found that Greentree was primarily at fault and therefore

liable to Sindledecker’s estate for $1,000,020 in damages.

[7] Following the verdict, Storch petitioned the trial court for attorney fees as

provided by Sindledecker’s residence agreement. Greentree argued that,

because Storch had dismissed the breach of contract claim, the residence

agreement was not at issue and, therefore, attorney fees could not be awarded

pursuant to the agreement. The trial court agreed, and denied Storch’s petition.

Storch then filed a motion to correct error, which the trial court denied on April

15, 2015. Storch now appeals.

Discussion and Decision
[8] Indiana adheres to the “American Rule” that parties must pay their own

attorney fees absent an agreement between the parties, a statute, or another rule

to the contrary. R.L. Turner Corp. v. Town of Brownsburg, 963 N.E.2d 453, 458

(Ind. 2012). The trial court’s decision that Storch was not entitled to attorney

fees in this case was based on its interpretation of terms of the residence

agreement entered into by Sindledecker and Greentree. Construction of the

terms of a written contract is a pure question of law for the court. Peoples Bank

& Trust Co. v. Price, 714 N.E.2d 712, 716 (Ind. Ct. App. 1999). Accordingly, we

review such decisions de novo. Id.

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[9] When interpreting a contract, our goal is to give effect to the intent of the

parties at the time they entered into the agreement. Tender Loving Care Mgmt.,

Inc. v. Sherls, 14 N.E.3d 67, 72 (Ind. Ct. App. 2014). We begin by examining

the plain language of the contract, “reading it in context and, whenever

possible, construing it so as to render each word, phrase, and term meaningful,

unambiguous, and harmonious with the whole.” Id.

[10] Here, the trial court held that Storch could not recover under the terms of the

residence agreement because she did not bring a breach of contract claim. It

reasoned:

[T]he Plaintiff and Defendants elected not to submit the breach
of contract matter to the jury to determine if the Defendants did
or did not breach the contract between Plaintiff and Defendants.
The jury was only required to determine if the Defendants
committed negligence in this case. Thus, the Plaintiff is not the
prevailing party regarding “any controversy, claim or dispute
between the parties hereto, arising out of or relating to this
Agreement or the breach thereof” and the Plaintiff is not entitled
to attorney’s fees under this agreement.

Appellant’s Br. p. 23. According to this interpretation, the phrase—“any

controversy, claim, or dispute between the parties hereto, arising out of or relating

to this Agreement or the breach thereof”—can refer only to claims of breach of the

contract, and not to claims premised on a tort theory of liability. Appellant’s

App. p. 58 (emphases added).

[11] Such an interpretation is plainly incorrect given the clear meaning of the

language used. Had Greentree intended this provision to apply only to claims
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 of breach of the agreement itself, it could simply have written a provision

awarding attorney fees to the prevailing party “in any action brought to enforce

this agreement.” Such language is commonly found in attorney fee provisions.

See Kuntz v. EVI, LLC, 999 N.E.2d 425, 433 (Ind. Ct. App. 2013). Yet the

provision at issue here clearly goes further, covering not only actions for breach

of the agreement, but also “any” other dispute “arising out of or relating to” the

agreement “or the breach thereof.” Appellant’s App. p. 58. Were we to adopt

the trial court’s interpretation, these latter terms would be rendered

meaningless. The above-referenced principles of contract interpretation compel

us to avoid such outcomes and, therefore, we must conclude that the plain

language of the provision contemplates more than actions for breach of the

agreement.

[12] We now must determine whether the present dispute, while a tort claim,

nevertheless falls into the category of any claim that arises out of or relates to

the agreement. Guidance on this issue from courts of this State is currently

limited to decisions interpreting agreements to arbitrate. Similar language is

frequently used in such agreements and we have shown no hesitation in holding

that it encompasses tort claims.

[13] For instance, in Precision Homes of Indiana, Inc. v. Pickford, a couple entered into a

contract with a general contractor for the construction of a home. 844 N.E.2d

126, 128 (Ind. Ct. App. 2006), trans. denied. The couple then had a contentious

meeting with the president of the contracting company, after which they filed

claims for assault, battery, and false imprisonment. Id. at 130. This Court held

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 that these claims fell within the scope of the contract’s arbitration clause, which

called for arbitration of any claims “arising from or related to the Property.” Id.

at 133.

[14] Nearly identical language was at issue in National Wine & Spirits, Inc. v. Ernst &

Young, LLP, where the companies entered into an auditing agreement and

agreed to arbitrate “any claim or controversy arising out of or relating to” the

agreement. 976 N.E.2d 699, 702 (Ind. 2012). In that case, the companies had

previously arbitrated a claim pursuant to the agreement in which Ernst &

Young had emerged victorious. Id. at 703. National Wine & Spirits then sued

Ernst & Young in tort for fraud and deception, alleging that it had presented

altered documents to the arbitration panel in the first suit. Id. Our Supreme

Court noted the “all-encompassing” nature of the language used by the parties

and concluded that it “would defy logic to say that this issue falls outside the

scope of the broad arbitration clause, as the documents certainly arise out of or

relate to the audit services that E & Y provided for NWS.” Id. at 706; see also

ISP.com LLC v. Theising, 805 N.E.2d 767 (Ind. 2004) (claim of fraudulent

transfer “relate[d] to” asset purchase agreement for purposes of arbitration

clause).

[15] Predictably, Greentree attempts to distinguish these cases on the ground that,

unlike the present case, they deal with the enforcement of arbitration clauses.

Greentree simply points to this fact and provides no further explanation,

apparently in the belief that this distinction alone should compel us to reach the

opposite conclusion here. See Appellee’s Br. p. 6-7. However, contrary to

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 Greentree’s assumption, we see no reason to read identical language two

different ways depending on whether it appears in an arbitration provision or

any other. It is true that “any doubts about the scope of [an] arbitration

agreement must be resolved in favor of arbitration.” Precision Homes, 844

N.E.2d at 133. However, for this presumption to apply, doubts must exist in

the first place. Simply because we have not recognized a similar presumption

in the attorney fee context does not mean that we would refuse to enforce

attorney fee provisions in cases where the plain language clearly calls for

enforcement.

[16] Greentree next argues that enforcement of the attorney fee provision is not

called for in this case because the subject matter of Sindledecker’s negligence

suit simply does not arise out of or relate to the residence agreement. Once

again, Greentree does little to develop this assertion into an argument, stating

only that Sindledecker’s “negligence claim did not involve wrongful eviction,

fraud, misrepresentation, or some other tort directly related to the Resident

Agreement.” Appellee’s Br. p. 8-9. We gather from this statement that

Greentree believes that the above-listed claims would relate to or arise out of the

agreement in a way that Sindledecker’s negligence claim would not. We are,

however, left to ourselves to ponder why this would be.

[17] We find no basis for such a distinction in the plain meaning of the word

“relate.” According to a modern dictionary, two things “relate” if they simply

“have relationship or connection.” Merriam-Webster Online Dictionary,

http://www.merrianwebster.com/dictionary/relate (last visited November 30,

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 2015). This definition is clearly very broad, but parties have the right to

contract in broad terms if they wish. Looking to other states for guidance, we

note that appellate courts in Colorado have had occasion to define “relate”—in

the attorney fees context nonetheless—and they have chosen to do so in a similarly

broad fashion, holding that such language “encompass[es] all issues

surrounding the underlying subject matter.” In re Estate of Gattis, 318 P.3d 549,

558 (Colo. App. 2013).

[18] Greentree reminds us that we are not bound by the decisions of these courts,

but fails to give us a reason to disagree. In fact, we believe that this definition

makes perfect sense. Courts of this state have already noted the breadth of such

language, referring to it as “all-encompassing.” National Wine & Spirits, 976

N.E.2d at 706. We have little doubt that the parties here intended such

language to be quite broad and that they, along with the general public, would

understand that anything “related to” an agreement would encompass all issues

surrounding the underlying subject matter of that agreement.

[19] Turning to the facts of this case, there can be no doubt that the underlying

subject matter of Sindledecker’s residence agreement was, indeed, his residence

at Greentree. And there can also be no doubt that the events that led to his

negligence claim occurred because he resided there, which would not have been

the case absent the residence agreement. Thus, reading the contractual

language in light of its plain, simple, and intentionally broad meaning, it is

hardly difficult to conclude that Sindledecker’s negligence claim involves the

same underlying subject matter as, and therefore relates to, his residence

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 agreement. Consequently, we find that the parties must have intended the

disputed attorney fees provision to apply to such a claim.

[20] We must clarify one final point regarding the trial court’s concern that the

residence agreement was never presented to the jury. While it is true that the

jury would have been required to decide if a breach of the agreement had

occurred, as we have already made clear, the provision at issue was intended to

apply to more than claims for breach of the agreement. Here, the fact that the

jury did not have the residence agreement before it was irrelevant, as neither

party disputed that the residence agreement was entered into mutually, and a

breach of the agreement was not at issue. The only remaining dispute was as to

the meaning of the agreement’s terms. Resolution of this dispute fell to the

court, as matters of contract interpretation are questions of law.

[21] Furthermore, in petitioning the trial court for attorney fees after the jury had

reached its decision in this case, Storch was following standard procedure. R.L.

Turner Corp., 963 N.E.2d at 459-60. Our Supreme Court has noted that a

petition for attorney fees presents an issue separate from the merits of a case

because the inquiry cannot commence until a party has prevailed. Id. at 459

(citing White v. N.H. Dep’t of Emp’t Sec., 455 U.S. 445, 451-52 (1982)).

Accordingly, a request for attorney fees “almost by definition is not ripe for

consideration until after the main event reaches an end,” and “[e]ntertaining

such petitions post-judgment is virtually the norm.” Id. at 460. “[I]n some

sense,” a request for attorney fees is an equitable petition. Id.

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[22] As to the amount of fees, this Court has recognized that there are instances

where a jury may decide whether an amount of fees is reasonable, such as

where the parties have stipulated to that effect or the contract calls for it.

Cavallo v. Allied Physicians of Michiana, LLC, No. 71A05-1406-PL-285 at *9 (Ind.

Ct. App. August 20, 2015). However, absent such agreements, parties do not

have the right to have a jury determine a reasonable amount of fees. Id. As no

such agreement exists in this case, we do not believe that any triable issue

remains. See E. Trading Co. v. Refco, Inc., 229 F.3d 617, 626-27 (7th Cir. 2000).

[23] In any event, Greentree has never argued that the jury should determine a

reasonable award of fees and has always assumed that such a determination

would be left to the trial court. See Appellant’s App. p. 90-91. We have

observed that “the trial judge is considered to be an expert on the question and

may judicially know what constitutes a reasonable attorney’s fee.” Longest ex

rel. Longest v. Sledge, 992 N.E.2d 221, 231 (Ind. Ct. App. 2013). We do not

doubt that the trial court is capable of considering evidence on this issue and

deciding what is reasonable in this case.

[24] The judgment of the trial court is reversed and remanded so that the trial court

may calculate reasonable attorney fees and award those fees to Sindledecker’s

estate, as called for in the parties’ residence agreement.

Bradford, J., and Pyle, J., concur.

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