22 N.E.3d 818
Ind. Ct. App.2014Background
- In July–August 2004 Van Petten and Folkening (through eCorp and DSL.com) executed a written settlement agreement: Company would pay Van Petten $175,000 for stock and either satisfy a mortgage on Shelbyville real estate by specified dates or Folkening would convey the deed to Van Petten.
- The Agreement included payment, mortgage-satisfaction, deed-conveyance-as-remedy, mutual releases, indemnification, and attorney-fee provisions.
- Appellants failed to pay $175,000 and failed to satisfy the mortgage or convey the deed by the contractual deadlines.
- Van Petten filed suit in October 2010 (more than six years later) seeking $175,000, conveyance of the deed, prejudgment interest, and attorney’s fees.
- Appellants moved to dismiss/for summary judgment asserting the six-year statute for written contracts to pay money (I.C. § 34-11-2-9) barred the claim; Van Petten argued the ten-year statute for other written contracts (I.C. § 34-11-2-11) applied.
- The trial court applied the ten-year statute, entered judgment for Van Petten, and the court of appeals affirmed; the majority held the substance of the contract controls and the Agreement was not solely a contract for payment of money.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Which statute of limitations applies to Van Petten’s breach-of-contract claims? | Agreement covers more than payment of money; apply 10-year written-contracts-other-than-payment statute (I.C. § 34-11-2-11). | Claim is essentially a promise to pay $175,000; apply 6-year written-contracts-for-payment statute (I.C. § 34-11-2-9). | 10-year statute applies because the Agreement’s substance extends beyond a mere promise to pay money. |
| Whether the Agreement is a promissory note/bill of exchange or equivalent to contracts "for the payment of money" | Not a promissory-note scenario; involves stock, real estate remedies, releases; thus not limited to payment-of-money category. | The money payment was the primary obligation and the deed provision is a contractual remedy tied to nonpayment. | The contract is not a promissory note/bill of exchange and includes non-monetary obligations/remedies, so it falls under the 10-year statute. |
| Whether Van Petten’s deed/conveyance claim alters the limitations analysis | Deed claim arises from the same Agreement and is a non-monetary obligation; statute must be uniform across claims. | Conveyance is a contractual remedy for nonpayment and does not change that the core harm was nonpayment. | The court treated the deed/conveyance claim as part of the contract’s substance and relevant to applying the longer limitations period. |
| Whether the trial court correctly denied dismissal/summary judgment on statute grounds | The complaint was timely under the 10-year statute; dismissal/summary judgment inappropriate. | The six-year statute barred the monetary claim; dismissal/summary judgment appropriate. | Court of appeals affirmed denial of dismissal and summary judgment, concluding Van Petten’s action fell under the 10-year statute. |
Key Cases Cited
- Shepherd Props. Co. v. Int’l Union of Painters & Allied Trades, Dist. Council 91, 972 N.E.2d 845 (Ind. 2012) (statutory interpretation reviewed de novo).
- INB Nat’l Bank v. Moran Elec. Serv., Inc., 608 N.E.2d 702 (Ind. Ct. App. 1993) (substance of the action, not form, determines applicable statute of limitations).
- Whitehouse v. Quinn, 477 N.E.2d 270 (Ind. 1985) (substance of alleged harm controls limitations inquiry).
- Klineman, Rose & Wolf, P.C. v. N. Am. Lab. Co., 656 N.E.2d 1206 (Ind. Ct. App. 1995) (limitations period determined by the nature of the cause of action).
- Stevenson v. Cnty. Comm’rs of Gibson Cnty., 3 N.E.3d 1062 (Ind. Ct. App. 2014) (avoid excessive literal reading; consider purpose and effect in statutory construction).