Cheng Song v. Thomas Iatarola and Theresa Iatarola

FILED
May 10 2017, 10:10 am

CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court

ATTORNEYS FOR APPELLANT ATTORNEY FOR APPELLEE
Robert A. Welsh Benjamen W. Murphy
Connor H. Nolan Law Office of Ben Murphy
Harris Welsh & Lukmann Griffith, Indiana
Chesterton, Indiana

IN THE
COURT OF APPEALS OF INDIANA

Cheng Song, May 10, 2017
Appellant-Cross-Appellee, Court of Appeals Case No.
64A03-1609-PL-2094
v. Appeal from the Porter Superior
Court
Thomas Iatarola and The Honorable William E. Alexa,
Theresa Iatarola, Judge
Appellees-Cross-Appellants Trial Court Cause No.
64D02-1109-PL-9151

Baker, Judge.

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[1] Cheng Song planned to purchase land from Thomas and Theresa Iatarola until

he discovered that the land was zoned for agricultural use, rather than for

industrial use, as had been represented to him. After terminating the purchase

agreement, Song sued the Iatarolas for the $150,000 he had placed in escrow.

A jury verdict awarded him the return of his money. He now appeals the trial

court’s denial of his petition for attorney fees and prejudgment interest. The

Iatarolas cross-appeal, arguing that the trial court erred in denying their motion

for summary judgment and motion to correct errors. Finding that the trial

court did not err in denying the Iatarolas’ motions, but that it did err in denying

Song’s motions, we affirm in part, reverse in part, and remand.

Facts
[2] In 1998, the Iatarolas purchased thirty-four acres of land that was zoned for

agricultural use. Thomas built several structures on the property to warehouse

equipment and inventory from his telecommunications and classic car sales

business.

[3] The land, which was adjacent to the Porter County Airport, was mortgaged.

The Iatarolas decided to try to sell ten acres of their land to reduce or repay

their debt to the bank. Thomas and Theresa agreed between themselves that

Thomas would take charge of arranging for the sale of their land, and he acted

as an agent on behalf of his wife from September 2010 through September 2011.

On September 14, 2010, Thomas retained Robert Macmahon as their exclusive

real estate agent for the sale of the ten acres.

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[4] On September 14, 2010, Macmahon showed Thomas a listing agreement for

the real estate sale. The form was entitled “Listing Contract (Exclusive Right to

Sell) Commercial-Industrial Real Estate”; under the section entitled “Seller’s

Representations,” the property is stated to be zoned I-2 Industrial. Appellant’s

App. Vol. II p. 90-91. Macmahon asked Thomas to review the listing to ensure

its accuracy and asked both Thomas and Theresa to initial each page of the

listing agreement to verify that they read it and that it was accurate. Thomas

did so, but Theresa refused to sign her initials because the listing inaccurately

stated that the zoning was I-2 Industrial rather than Agricultural. Theresa told

Thomas that her reason for not initialing the listing and told him to have

Macmahon correct the listing error.

[5] A few days later, Thomas told Theresa that he had spoken with Macmahon and

that the listing had been corrected. Theresa did not see or initial a corrected

listing. On or around September 14, 2010, Macmahon began advertising the

real estate online. The advertisements stated that the land was zoned I-2

Industrial and that it was suitable for warehousing and other light industrial

uses.

[6] In December 2010, Song saw online the advertisement for the sale of the ten

acres of land. At this time, Song was a New Jersey resident who wanted to buy

industrial real estate in northwest Indiana to use for an imported tool business

he wanted to start. Song arranged a meeting with Macmahon to take place on

December 31, 2010, to visit two industrially zoned properties, one of which was

the Iatarolas’ land. During their meeting, Song told Macmahon that he wanted

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to buy property that had buildings suitable for warehousing for an imported tool

business, and they discussed Song’s ability to expand and build additional

industrial warehousing on the property. In an internet advertisement that has

Macmahon’s handwriting on it, the property’s type is described as “Industrial

For Sale”; the property overview states that the land is “in an established

industrial area.” Appellant’s App. Vol II p. 87.

[7] Also on December 31, 2010, Song told the Iatarolas of his intended use of the

property he wanted to purchase. That same day, Song signed a purchase

agreement with the Iatarolas to buy their ten acres for $600,000. The contract

was entitled “Purchase Agreement Commercial-Industrial Real Estate.”

Appellees’ App. Vol. II p. 97.

[8] Sometime before the signing, the Porter County Airport had stated that it might

impose a runway protection zone in this property to comply with Federal

Aviation Administration (“FAA”) requirements. The purchase agreement

included a contingency clause that stated, “This agreement is contingent upon

the Buyer’s agreement with the final approval of FAA regarding land use.” Id.

After reviewing the airport’s proposal, Song worried that the runway protection

zone could lead to a governmental taking of part of the property that he was

purchasing, the removal of some of the warehousing buildings, or a restriction

on the height of future construction. On January 6, 2011, he exercised his

contingency right and terminated the purchase agreement.

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[9] For the next two and one-half months, Song and Thomas negotiated a new sale

of a different part of the Iatarolas’ land. On March 21, 2011, they signed a

second purchase agreement for sixteen acres, which included most of the

original ten acres with the warehousing buildings plus additional acres of land

outside the potential runway protection zone. This second purchase agreement

was entitled “Purchase Agreement Commercial-Industrial Real Estate.”

Appellant’s App. Vol. II p. 35. It required $150,000 in earnest money and

included a provision for liquidated damages of $150,000 if either party breached

the contract. Song and Thomas signed an addendum to the second purchase

agreement that provided:

Closing date will be predicated on the Seller’s ability to vacate
and exit the subject property. A maximum of 180 days (“Due
Diligence Period”) from the day of acceptance of this contract,
has been agreed by both parties. When the seller advises the
Buyer in writing, that the exit is complete, the Buyer will have 30
days, from that date, to close.

Id. at 40. Song deposited the $150,000 earnest money in the bank.

[10] In early June 2011, Thomas called Macmahon to say that while reviewing the

transaction paperwork, he saw that the September 14, 2010, listing inaccurately

stated that the property for sale was zoned I-2 Industrial instead of Agricultural.

Macmahon acknowledged the error and made a note to his file of the date and

subject of their phone call. That same day, Macmahon corrected the zoning

represented in his advertisements online so that they showed the property to be

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zoned Agricultural. Neither Macmahon nor Thomas told Song about this

error.

[11] On August 7, 2011, Thomas and Song met on the property for a final

inspection, and Thomas told Song that the property was zoned Agricultural.

Thomas told Song that Agricultural zoning was preferred over Industrial zoning

because the tax rate was lower; he also stated that Agricultural zoning allowed

for the land to be used for the industrial warehousing and import tool business

that Song wanted to start. Song told Thomas that he needed to consult an

attorney to determine whether the Agricultural zoning would suit his needs.

Later that day, Song saw that the online listing for the property had been

updated to show that it was zoned Agricultural.

[12] On August 12, 2011, Lee Lane, Song’s attorney, wrote to Macmahon to advise

him that the Porter County zoning regulations did not permit the use of

warehousing for industrial purposes on agriculturally-zoned property. Lane

stated that Song would not continue with his purchase unless the Iatarolas

secured I-2 Industrial zoning and demanded a price reduction in order to

compensate Song for the increase in real estate tax that would result from the

change from agricultural to industrial zoning.

[13] The Iatarolas refused to obtain the I-2 Industrial zoning or consider a price

reduction. Song subsequently exercised his due diligence contingency rights

under the contract, terminated the purchase agreement within the 180-day due

diligence period provided in the addendum, and demanded the return of his

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$150,000 earnest money deposit, which was being held in escrow at Horizon

Bank. The Iatarolas refused to return Song’s escrow deposit.

[14] On September 19, 2011, Song filed a complaint against the Iatarolas, alleging

actual fraud, constructive fraud, breach of contract, and contract rescission.

The Iatarolas filed a counterclaim, also alleging actual and constructive fraud.

On January 22, 2014, both parties filed motions for summary judgment; the

trial court denied both. A jury trial took place from May 16-19, 2016. On May

19, 2016, Song filed a motion for judgment on the evidence, which the trial

court denied. The jury returned a verdict for Song, and the trial court entered

judgment on the jury’s verdict in Song’s favor for $150,000. On June 20, 2016,

the Iatarolas filed a motion to correct errors. On June 23, 2016, Song filed a

motion for an award of attorney fees, prejudgment interest, and postjudgment

interest. On August 12, 2016, Song filed a motion for an award of his post-trial

attorney fees.

[15] On August 12, 2016, the trial court held a joint hearing for the Iatarolas’ motion

to correct errors and Song’s motions for attorney fees, prejudgment interest, and

postjudgment interest. The trial court denied all motions. Song now appeals,

and the Iatarolas cross-appeal.

Discussion and Decision
I. Summary Judgment
[16] On cross-appeal, the Iatarolas argue that the trial court erred when it denied

their motion for summary judgment. In their motion for summary judgment,

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the Iatarolas argued that there were no genuine issues of material fact regarding

Song’s breach of the purchase agreement because nothing in the four corners of

the contract allowed him to terminate it for zoning and because any

representations regarding zoning could not establish the defenses or claims of

fraud, constructive fraud, or mutual mistake.

[17] Our standard of review on summary judgment is well established:

We review summary judgment de novo, applying the same
standard as the trial court: “Drawing all reasonable inferences in
favor of . . . the non-moving parties, summary judgment is
appropriate ‘if the designated evidentiary matter shows that there
is no genuine issue as to any material fact and that the moving
party is entitled to judgment as a matter of law.’” Williams v.
Tharp, 914 N.E.2d 756, 761 (Ind. 2009) (quoting T.R. 56(C)). “A
fact is ‘material’ if its resolution would affect the outcome of the
case, and an issue is ‘genuine’ if a trier of fact is required to
resolve the parties' differing accounts of the truth, or if the
undisputed material facts support conflicting reasonable
inferences.” Id. (internal citations omitted).

Hughley v. State, 15 N.E.3d 1000, 1003 (Ind. 2014).

A. Contract Interpretation
[18] The construction of a written contract is generally a question of law. The

Winterton, LLC v. Winterton Investors, LLC, 900 N.E.2d 754, 759 (Ind. Ct. App.

2009). When interpreting a contract, we attempt to determine the intent of the

parties at the time the contract was made. Id. When the language of the

contract is unambiguous, the parties’ intent is determined from the four corners

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of the document. Id. “The unambiguous language of a contract is conclusive

upon the parties to the contract as well as upon the court.” Id. A contract is

ambiguous when a reasonable person could find its terms susceptible to more

than one interpretation. Id. If a contract is ambiguous, the court may consider

extrinsic evidence, and the construction of the contract becomes a matter for the

trier of fact. Id.

[19] The Iatarolas argue that the second purchase agreement did not permit Song to

terminate the agreement because the land was zoned differently than what he

expected. Song replies that the Iatarolas waived this argument because they

failed to raise it before the trial court on summary judgment. We agree that the

Iatarolas failed to present a cogent argument on this issue to the trial court and

therefore also agree that they have waived it.

[20] Waiver notwithstanding, at issue is paragraph nine of the addendum to the

second purchase agreement, which reads

Appellant’s App. Vol. II p. 40. The Iatarolas read this paragraph to mean that

they had to use due diligence to vacate the premises within 180 days; Song

contends that a due diligence period exists for the benefit of the buyer to

investigate facts regarding the suitability of the property for the buyer’s purpose.
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[21] Generally, in real estate transactions, the term “due diligence” refers to the

parties’ obligations to “investigate facts rather than make assumptions about

them.” Hartig v. Stratman, 760 N.E.2d 668, 671 (Ind. Ct. App. 2002). In Metro

Holdings One, LLC v. Flynn Creek Partner, LLC, 25 N.E.3d 141, 158-59 (Ind. Ct.

App. 2014), this Court considered the role of the due diligence period in a real

estate transaction. The purchase agreement provided:

“4. Conditions of Performance. All of the items in this Section
4 shall be completed and/or satisfied on or before [April 15,]
2007 (the “Due Diligence Period”), and Purchaser’s obligations
under this Agreement shall be contingent upon the timely and
complete satisfaction of the following conditions precedent or
waiver thereof by Purchaser, in writing:

*****

“(e) Wetlands Delineation Study. Purchaser, at its cost and
expense, may conduct or have conducted any wetland
delineation study of the Real Estate, to determine whether there
are any wetlands on the Real Estate under the jurisdiction of the
Army Corps of Engineers. In the event that wetlands are
discovered on the Real Estate, at Purchaser's election, this
agreement shall terminate and Purchaser shall receive an
immediate refund of the earnest money, together with any
interest earned thereon, or Purchaser may proceed with the
purchase and receive a reduction of the per acre price to the
extent of any delineated wetlands located on the [Phase 2
Property].”

Id. This Court found that the plain language of this section of the purchase

agreement required the buyer to complete the study and provide written notice

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of termination prior to the end of the due diligence period. Because the buyer

failed to do so, this Court found that the buyer breached its contract.

[22] Unlike the purchase agreement in Metro Holdings, which specified actions that

the buyer could take during the due diligence period and the effect of those

actions, here, the purchase agreement does not state the purpose of the due

diligence period. The provision supports both parties’ arguments, and because

of the context in which the term “Due Diligence Period” is found, a reasonable

person could find its terms susceptible to more than one interpretation, making

it ambiguous. Its placement in a paragraph about the Iatarolas’ ability to vacate

the property and the timing of the closing date implies that the due diligence

period is related to their ability to actually vacate the property. And yet, as

Song contends, such an interpretation is at odds with the law and how the term

is generally applied in real estate transactions. When there is ambiguity in a

contract, it is construed against its drafter. MPACT Const. Grp., LLC v. Superior

Concrete Constructors, Inc., 802 N.E.2d 901, 910 (Ind. 2004). Therefore, the

phrase should be construed against the Iatarolas. Accordingly, we find that the

trial court did not err when it denied the Iatarolas’ motion for summary

judgment based on this issue.

B. Representations Regarding Zoning
a. Actual Fraud
[23] In his complaint, Song alleged that the Iatarolas committed actual fraud against

him based on the misrepresentation of the zoning of the property. In their

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motion for summary judgment, the Iatarolas contended that they made no

representations to Song about the zoning of the property; on cross-appeal, they

argue that the addendum’s integration clause should foreclose Song’s fraud

claim and that a fraud action regarding zoning representations must fail when

the zoning laws are public record.

[24] The elements of actual fraud are: (i) material misrepresentation of past or

existing facts by the party to be charged, (ii) which was false, (iii) which was

made with knowledge or reckless ignorance of the falseness, (iv) which was

relied upon by the complaining party, and (v) proximately caused the

complaining party injury. Rice v. Strunk, 670 N.E.2d 1280, 1289 (Ind. 1996).

[25] In their motion for summary judgment, the Iatarolas contend that they made no

representations of any kind to Song about the zoning of the property, but “[a]t

the one and only occasion Song inquired about the zoning—long after the

contract was signed and after Iatarola had vacated the property, Iatarola spoke

truthfully of the zoning status.” Appellees’ App. Vol. VI p. 78-79. In Craig v.

ERA Mark Five Realtors, 509 N.E.2d 1144, 1147 (Ind. Ct. App. 1987), this Court

found that the defendants did not commit actual fraud because the “mere fact

that the defendants represented the property as an apartment building does not

rise to the level of an affirmative representation that the use of the property [as a

multiple-family dwelling] was permissible under the applicable zoning

ordinance.” We find Craig distinguishable from the present case. In Craig, this

Court noted that the term “multi-family” used in listing documents had nothing

to do with zoning, but was merely used by realtors to distinguish such property

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from other kinds of residential property. Id. Here, however, the listing

document specifically stated that the property was zoned I-2 Industrial.

Moreover, in Craig, there was no representation to the buyer about the specific

zoning classification. Here, a reasonable factfinder could find that the fact that

Song viewed information that described the property as “Industrial” and stated

that the property is “in an established industrial area,” Appellant’s App. Vol. II

p. 87, constitutes a false material misrepresentation. The trial court did not err

in finding a genuine issue of material fact or in denying the Iatarolas’ motion

for summary judgment on this issue.

[26] Regarding the Iatarolas’ arguments on cross-appeal, we note again that they

have waived these arguments because they did not make them to the trial court

in their motion for summary judgment. Waiver notwithstanding, we will

address their arguments.

[27] The Iatarolas argue that the inclusion of an integration clause precludes Song’s

actual fraud claim. An integration clause serves “to determine the intention of

the parties and to determine if that which they intended to contract is fully

expressed in the four corners of the writing.” Prall v. Ind. Nat’l Bank, 627

N.E.2d 1374, 1377–78 (Ind. Ct. App. 1994) (citing Franklin v. White, 493

N.E.2d 161, 166 (Ind. 1986)). “Generally, where parties have reduced an

agreement to writing and have stated in an integration clause that the written

document embodies the complete agreement between the parties, the parol

evidence rule prohibits courts from considering extrinsic evidence for the

purpose of varying or adding to the terms of the written contract.” Id. (citing

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I.C.C. Protective Coatings, Inc. v. A.E. Staley Mfg. Co., 695 N.E.2d 1030, 1035 (Ind.

Ct. App. 1998)). An exception applies “in the case of fraud in the inducement,

where a party was ‘induced’ through fraudulent representations to enter a

contract.” Circle Ctr. Dev. Co. v. Y/G Ind., L.P., 762 N.E.2d 176, 179 (Ind. Ct.

App. 2002).

[28] The Iatarolas state that Song is a sophisticated and well-educated person who

had “plenty of time to investigate the zoning and taxes from public record.”

Appellee’s Br. p. 27. Song’s level of education, however, does not negate the

fact that “a party [can] overcome the effect of an integration clause if it [can]

show it had a right to rely on the alleged misrepresentations and did in fact rely

on them in executing . . . [an] integration clause.” Tru-Cal, Inc. v. Conrad Kacsik

Instrument Systems, Inc., 905 N.E.2d 40, 45 (Ind. Ct. App. 2009). We do not

find that the mere inclusion of an integration clause defeats Song’s fraud claim

because he had a right to rely on the Iatarolas’ representations regarding the

zoning of the property and did, in fact, rely on them. Therefore, we find that

the trial court did not err in finding that genuine issues of material fact exist or

in denying the Iatarolas’ motion for summary judgment.

[29] The Iatarolas also contend that a fraud action regarding zoning representation

must fail because how real estate is zoned is public record, and therefore any

representation does not constitute a past or existing fact that a party can claim

to have relied on. Initially, we note that the Iatarolas cite legal authority from

other jurisdictions, which is not binding in our state. In Indiana, it is well

established that “[a] false statement made for a fraudulent purpose . . . can be

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justifiably relied upon even though the fact misrepresented is of public record.”

Shuee v. Gedert, 182 Ind. App. 432, 438, 395 N.E.2d 804, 808 n.3 (1979); see also

Carrell v. Ellingwood, 423 N.E.2d 630, 635 (Ind. Ct. App. 1981) (“It is further the

law in Indiana that a false and fraudulent representation may be relied upon by

a person having no actual knowledge, even though the fact in question is a

matter of public record”); Jenkins v. Nebo Props., Inc., 439 N.E.2d 686, 694 (Ind.

Ct. App. 1982) (“A party can justifiably rely on statements which are a matter

of public record”). Consequently, the trial court did not err in denying the

Iatarolas’ motion for summary judgment on this issue.

b. Constructive Fraud
[30] In his complaint, Song alleged that the Iatarolas also committed constructive

fraud against him based on the misrepresentation of the zoning of the property.

In their motion for summary judgment, the Iatarolas contended that Song’s

constructive fraud claim must fail because any representation about the zoning

of the property did not constitute a past fact upon which Song could rely

because zoning is public information; on cross-appeal, they argue for the first

time that his claim must fail because no fiduciary relationship existed between

the parties.

[31] Constructive fraud arises by operation of law from a course of conduct, which,

if sanctioned by law, would secure an unconscionable advantage, irrespective of

the actual intent to defraud. Strong v. Jackson, 777 N.E.2d 1141, 1146 (Ind. Ct.

App. 2002), on reh'g, 781 N.E.2d 770 (Ind. Ct. App. 2003). The elements of

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constructive fraud are: (i) a duty owing by the party to be charged to the

complaining party due to their relationship; (ii) violation of that duty by the

making of deceptive material misrepresentations of past or existing facts or

remaining silent when a duty to speak exists; (iii) reliance thereon by the

complaining party; (iv) injury to the complaining party as a proximate result

thereof; and (v) the gaining of an advantage by the party to be charged at the

expense of the complaining party. Rice, 670 N.E.2d at 1284.

[32] First, the Iatarolas allege that Song’s constructive fraud claim must fail because

zoning information is a matter of public record, but as discussed above, Indiana

law permits a fraud claim even when the misrepresented fact is of public record.

The Iatarolas again rely on Craig, but again, we find that case distinguishable.

In Craig, this Court found that a constructive fraud claim must fail because the

information at issue was in the public record and the buyer had easy access to

it. 509 N.E.2d at 1148. The buyer had prior experience purchasing real estate;

he managed his properties full-time; he was licensed to sell real estate for at

least several years before the transaction at the heart of the lawsuit took place;

and he had at one time owned and operated a real estate school. Id. For these

reasons, this Court found that the buyer was not an “inexperienced amateur” in

the real estate business, but rather that he possessed the knowledge and skill to

ascertain the zoning of the purchased property. Id. Although Song is well-

educated, his degrees are not related to real estate; he was not an Indiana

resident, and the record does not show whether he was familiar with Indiana

public records; the record does not indicate that he is not an “inexperienced

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amateur” in the real estate business like the buyer in Craig; and the record does

not reveal whether Song had previous experience buying any kind of real estate,

let alone the kind of land that he was seeking for his new business. That

information is a matter of public record is not, in and of itself, sufficient to

preclude a constructive fraud claim.

[33] Second, once again, we note that the Iatarolas present an argument on cross-

appeal that was not made in their motion for summary judgment to the trial

court—namely, that Song’s constructive fraud claim must fail because no

fiduciary relationship existed between the parties. Further, on cross-appeal, the

Iatarolas do not present a cogent argument regarding the existence or lack

thereof of a fiduciary relationship. Nonetheless, we will briefly address this

argument. A constructive fraud claim need not involve a fiduciary relationship;

the duty required for the claim may exist “where there is a buyer and a seller,

where one party may possess knowledge not possessed by the other and may

thereby enjoy a position of superiority over the other.” Strong, 777 N.E.2d at

1147. The Iatarolas contend that they were not acting from a position of

superiority because Song has multiple advanced degrees. They fail to recognize

that under a constructive fraud claim, a position of superiority does not depend

on a party’s education level but on the level of knowledge that a party may

possess. We find that the Iatarolas did not present evidence that would negate

an element of Song’s constructive fraud claim and that the trial court did not err

in denying their motion for summary judgment on this issue.

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C. Contract Rescission
[34] In his complaint, Song asked for a judgment of contractual rescission, alleging

that no contract was formed because there was mutual mistake on the zoning

classification. The Iatarolas did not address this claim in their motion for

summary judgment, making this issue waived, though they raise it in their

cross-appeal. We note that the trial court did not grant Song’s request to

rescind the contract. Consequently, the Iatarolas can make no claim of error on

this issue.

D. Contract Breach
[35] In his complaint, Song alleged that the Iatarolas breached the purchase

agreement, for, among other things, failing to provide an I-2 Industrial zoned

property for purchase as represented and promised. In their motion for

summary judgment and on cross-appeal, the Iatarolas contend that Song

breached the contract when he refused to close on the transaction. The

Iatarolas do not present a cogent argument or legal authority to support the

position that Song caused the breach. Consequently, the trial court did not err

in finding that a genuine issue of material fact existed as to which party

breached the contract, and it appropriately allowed the jury to act as factfinder

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on this issue. Therefore, the trial court did not err in denying the Iatarolas’

motion for summary judgment on this issue.1

II. Attorney Fees
[36] On appeal, Song argues that, pursuant to the purchase agreement, he should

receive an award for his attorney fees. The Iatarolas argue that because Song

repudiated the purchase agreement, he cannot seek to have the agreement’s

attorney fees provision enforced.

[37] Indiana adheres to the American rule that, in general, a party must pay his own

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

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

2012). When an agreement allows one party to request attorney fees from

another party, it is standard procedure for that party to petition the trial court

for those fees after the jury has reached its decision in its case. Storch v. Provision

Living, LLC, 47 N.E.3d 1270, 1275 (Ind. Ct. App. 2015) (citing R.L. Turner

Corp., 963 N.E.2d at 459-60). 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. A request for attorney fees is not ripe for consideration

until a judgment has been reached. Id. Outside of stipulations or contracts that

1
In their cross-appeal, the Iatarolas also argue that the trial court erred when it denied their motion to correct
errors after trial. Their arguments are the same as their arguments regarding their motion for summary
judgment. We apply the same reasoning and findings to their argument regarding their motion to correct
errors as we did for their motion for summary judgment.

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call for a jury’s decision on attorney fees, “parties do not have the right to have

a jury determine a reasonable amount of fees.” Id. The trial judge is considered

to be an expert on the question of attorney fees and may judicially know what

constitutes a reasonable fee. Id.

[38] The purchase agreement provided the following provision:

Any party who is the prevailing party against any other party in
any legal or equitable proceeding relating to this Agreement shall
be entitled to recover court costs and reasonable attorney fees
from the non-prevailing party.

Appellant’s App. Vol. II p. 97. Following the jury’s verdict in his favor, Song

filed a motion for attorney fees, prejudgment interest, and postjudgment

interest. His motion included an affidavit from his attorney and an itemization

of fees incurred. In a post-trial hearing regarding Song’s motion for attorney

fees and interest, the trial court stated:

With regard to the amount for the attorney’s fees, I’m reading the
exact verdict from the jury. Said the jury returned into open
court with the following verdict: Verdict for plaintiff. “We, the
jury, decide in favor of the plaintiff and against the defendants
that the plaintiff is entitled to and shall have the return of his
earnest money in the amount of $150,000.” After they returned
with that, I entered judgment on the verdict. At that point, the
plaintiff was entitled to those funds.

There was no request before the jury that I can recall with regard
to attorney’s fees and interest either post or pre for the trier of fact
to deal with. They didn’t have that. And I certainly am not
going to be the trier of fact at this point in this proceedings. I

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think that the most that can be said, that the plaintiff is entitled to
judgment interest from and after . . . the 19th of May of this year.

Bench Hearing Tr. Vol. III p. 37-38.

[39] Song was not required to submit to the jury a request for attorney fees. In this

case, because the jury had already fulfilled its role, the trial court was the

appropriate trier of fact in determining whether attorney fees should have been

awarded. Further, Song was not required to submit a petition for attorney fees

before the jury returned its verdict; indeed, doing so would have been

premature. The appropriate time for Song to petition the trial court for attorney

fees was after the jury returned a verdict in his favor—which is what Song did.

The trial court erred when, instead of ruling on the issue, it simply declined to

consider it. Accordingly, the judgment of the trial court is reversed and

remanded so that the trial court may consider the issue of attorney fees as

provided for in the parties’ purchase agreement.

III. Prejudgment Interest
[40] On appeal, Song also argues that he should receive prejudgment interest. The

Iatarolas contend that Song should not receive prejudgment interest because the

jury verdict did not constitute a money judgment and because the $150,000

Song placed in escrow already earned interest while in the escrow account.

[41] Indiana Code section 24-4.6-1-101 provides for “interest on judgments for

money whenever rendered.” A judgment for money is “any order that requires

the payment of a sum of money and states the specific amount due, whether labeled as

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a mandate or a civil money judgment.” Hilliard v. Jacobs, 916 N.E.2d 689, 694

(Ind. Ct. App. 2009) (emphasis original). Prejudgment interest is awarded to

fully compensate an injured party for the lost use of money. Fackler v. Powell,

923 N.E.2d 973, 977 (Ind. Ct. App. 2010). It is computed from the time the

principal amount was demanded or due and is allowable at the permissible

statutory rate when no contractual provision specifies the interest rate. Id.; see

also Ind. Code § 24-4.6-1-103(b). The current interest rate is 8% when there is

no contract by the parties specifying a different interest rate. Ind. Code § 24-

4.6-1-101.

[42] It is well-settled that an award of prejudgment interest in a breach of contract

action is warranted if the amount of the claim rests upon a simple calculation

and the terms of the contract make such a claim ascertainable. Fackler, 923

N.E.2d at 979. The test for determining whether an award of prejudgment

interest is appropriate is whether the damages are complete and may be

ascertained as of a particular time. Id. The award is considered proper when

the trier of fact does not have to exercise its judgment to assess the amount of

damages. Id. Importantly for purposes of our review, an award of prejudgment

interest is generally not considered a matter of discretion. Id.

[43] When Song’s attorney asked the trial court whether it ruled on its motion for

prejudgment interest and postjudgment interest, the trial court stated:

I said it wasn’t presented to the jury, they had nothing in front of
them to do. You told me the fact finder was the one to do it, so
there is none for prejudgment interest. Post judgment interest,

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the judgment was entered on May 19th for the return of the
money. It wasn’t a money judgment. It was an order to turn
over in effect. It’s there. It’s available. Go get it.

***

You have 30 days to decide when you’re going to appeal it, this
rather, or that. And at that point interest will be accruing on that
at least from that May 19th date. At least. There you go.

Bench Hearing Tr. Vol. III p. 39-40.

[44] The Iatarolas latch onto the trial court’s statement that the jury’s verdict

awarding Song the return of his $150,000 was not a money judgment that can

receive prejudgment interest under the statute. They contend that the judgment

was not a general money judgment but “rather the return of a specific item of

property.” Appellee’s Br. p. 42. We disagree. Following the jury’s verdict, the

trial court ordered the Iatarolas to pay a sum of money to Song and stated the

specific amount due—this order is the very definition of a money judgment. See

Hilliard, 916 N.E.2d at 694. Because Song was awarded a money judgment,

and because the amount could be ascertained as of a particular time,

prejudgment interest was warranted.

[45] Although Song could have presented his claim for prejudgment interest to the

jury, not doing so did not preclude his claim. In Board of Works of City of Lake

Station v. I.A.E., Inc., 956 N.E.2d 86, 96 (Ind. Ct. App. 2011), this Court found

that the trial court did not err when it allowed the jury to determine the amount

of prejudgment interest owed because the jury only had to make a simple
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mathematical computation of the statutory rate from the time of the demand for

damages. But in other cases, this Court has taken no issue with the fact that a

trial court, rather than a jury, has determined a prejudgment interest award.

See, e.g., WESCO Distrib., Inc. v. ArcelorMittal Ind. Harbor LLC, 23 N.E.3d 682,

714-15 (Ind. Ct. App. 2014) (discussing the trial court’s award of prejudgment

interest following a jury trial). Here, the trial court was not required to defer to

the jury on Song’s motion for prejudgment interest, and it erred by doing so.

[46] The Iatarolas contend that because the parties entered into an escrow

agreement, which provided the terms for the holding and release of earnest

money deposited into an interest-bearing account, Song is not entitled to any

prejudgment interest on the $150,000 above and beyond the interest received on

the escrowed money. The Iatarolas do not provide any legal authority to

support their contention that because funds are earning interest in an interest-

bearing account that a prevailing party should not also receive prejudgment

interest, nor do we find any legal authority to support this argument.

[47] Nor do we find compelling the Iatarolas’ suggestion that the escrow agreement

should control the prejudgment interest rate. The Iatarolas state that because

the “interest rate was previously defined, the Indiana prejudgment interest

statute does not supersede that agreement.” Appellee’s Br. p. 43. The Iatarolas

do not state what this interest rate is, nor do we find it defined in the escrow

agreement. But even if the escrow agreement did specify an interest rate for the

funds while they were held in escrow, we cannot say that that interest rate

would also apply to the rate for prejudgment interest. This Court considered a

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similar contention in Bank One, Nat. Ass’n v. Surber, 899 N.E.2d 693 (Ind. Ct.

App. 2009). Following a successful breach of contract claim against it, the bank

argued that the trial court erred when it awarded prejudgment interest at the

statutory rate of 8%, rather than at the interest rate specified for the savings

account at issue, which was 1.5%. Id. at 705-06. This Court found that the

contract governing the savings account did not detail the interest rate that

should be applied to prejudgment interest, that the parties had not agreed upon

an interest rate, and that, therefore, the interest should be calculated at the

statutory rate of 8%. Id. at 706. Similarly, here, neither the purchase agreement

nor the escrow agreement states an interest rate for prejudgment interest. The

Iatarolas’ argument is unavailing.

[48] Accordingly, we reverse and remand the trial court’s denial of Song’s request

for prejudgment interest, and remand so that the trial court may calculate, using

the statutory rate, the amount of prejudgment interest Song is owed. On

remand, the trial court should also calculate the postjudgment interest at the

statutory rate.

[49] The judgment of the trial court is affirmed in part, reversed in part, and

remanded with instructions to consider Song’s motions for attorney fees and

prejudgment interest.

Barnes, J., and Crone, J., concur.

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