Maria S. Sanchez v. Michael D. Sphire (mem. dec.)
13A01-1610-PL-2407
| Ind. Ct. App. | Jun 23, 2017Background
- In May–June 2010 Sphire and Sanchez entered a purchase agreement for real property in Crawford County; the contract was not recorded.
- Sphire sued in August 2015 to foreclose the contract, alleging Sanchez failed to make monthly and tax payments.
- Sanchez called Sphire, offered to settle for a $10,000 lump sum plus $1,000 monthly payments; Sphire accepted and received a $10,000 cashier’s check and gave a receipt.
- Sphire sent unsigned written documents purporting to amend the contract; Sanchez refused to sign and testified the written documents did not reflect their oral settlement.
- A default judgment was entered for Sphire, later set aside after Sanchez moved to vacate based on the alleged settlement; bench trial followed.
- The trial court ruled for Sphire on foreclosure and awarded sale procedures; it did not address the oral settlement and denied Sanchez attorney’s fees. Sanchez appealed.
Issues
| Issue | Plaintiff's Argument (Sphire) | Defendant's Argument (Sanchez) | Held |
|---|---|---|---|
| Whether the court should enforce the parties’ oral settlement of the foreclosure action | Settlement not enforceable as oral terms were not reduced to a signed writing (implied) | An oral settlement was formed: offer ($10,000 + $1,000/month), acceptance (Sphire accepted and cashed $10,000), and consideration — court should enforce it | Reversed: court erred by failing to enforce the oral settlement (oral agreement found) |
| Whether Sanchez is entitled to attorney’s fees under the Purchase Agreement indemnity clause | (Implicit) fees not recoverable because no prevailing-party judgment in Sanchez’s favor after trial on the merits | Contract entitles the substantially prevailing party to attorney’s fees; Sanchez argues she is substantially prevailing because settlement resolved dispute | Affirmed: no attorney’s fees for Sanchez — private settlement alone does not create prevailing-party status absent contractual definition or judgment |
Key Cases Cited
- Vernon v. Acton, 732 N.E.2d 805 (Ind. 2000) (settlement agreements need not be in writing to be enforceable)
- Georgos v. Jackson, 790 N.E.2d 448 (Ind. 2003) (Indiana strongly favors settlements; settlement governed by general contract principles)
- Zimmerman v. McColley, 926 N.E.2d 71 (Ind. Ct. App. 2010) (offer, acceptance, and consideration form the basis of a contract; refusing to consummate a settlement can be enforced)
- Reuille v. E.E. Brandenberger Constr., Inc., 888 N.E.2d 770 (Ind. 2008) (contract awarding fees to the "prevailing party" requires a judgment to trigger fees when contract lacks a definition)
- Delgado v. Boyles, 922 N.E.2d 1267 (Ind. Ct. App. 2010) (private settlement or mediation does not yield a prevailing party for fee-shifting absent a judgment)