156 N.E.3d 703
Ind. Ct. App.2020Background
- Towne & Terrace is a private nonprofit condominium corporation; the City owned at least 49 units in the complex, many vacant and boarded, which the City alleged contributed to crime and public-resource expenditures.
- The City filed suit alleging Towne & Terrace failed to maintain common areas and sought damages and equitable relief; Towne & Terrace counterclaimed for unpaid maintenance fees.
- Prior appeals: this litigation produced two earlier opinions—Towne I (affirming summary judgment for Towne & Terrace on the City’s nuisance/refund theory) and Towne II (reversing appointment of a receiver under the Unsafe Building Law and limiting receivership scope).
- The trial court appointed a receiver over City‑owned units, entered a Revised Receivership Order authorizing the receiver to manage/market/demolish/sell City properties, and directed cooperation between the City, Towne & Terrace, and the receiver.
- Disputes followed: the City sought a mandatory/preliminary injunction to ensure all owners (including the City) could vote at meetings; the receiver sought documents; Towne & Terrace sought writs of execution and instructions to force liquidation and to require the City to pay receivership costs.
- On February 19, 2020 the trial court granted the City’s preliminary injunction, denied Towne & Terrace’s petition for writ of execution/instructions, granted the receiver’s motion to compel production of documents, and ordered Towne & Terrace responsible for one-half of receiver expenses; the Court of Appeals affirmed.
Issues
| Issue | Plaintiff's Argument (City) | Defendant's Argument (Towne & Terrace) | Held |
|---|---|---|---|
| 1. Grant of preliminary injunction to allow City (and receiver) to vote/participate at meetings | Injunction necessary to protect members’ voting rights and ensure fair membership meetings; hearing was held | Trial court issued injunction without proper hearing on subsequent filings and without adequate evidentiary support | Affirmed; court had held an October 15, 2019 hearing, matter was under advisement, appellant failed to provide transcript of that hearing so factual challenges were waived or not shown |
| 2. Denial of petition for writ of execution and instructions to receiver (requesting immediate sale/liquidation and execution on City properties) | Court should permit execution/sale to prevent receivership expenses from eroding value and satisfy Towne & Terrace’s claims | Immediate sale/demolition would affect nonparty owners and was premature; receiver must complete analysis before liquidation | Affirmed denial; court concluded liquidation could harm nonparties and statutory prohibitions barred execution on City properties pending receiver’s work |
| 3. Receiver’s motion to compel production of documents (unit owner/contact lists; unit-level income, delinquencies, expenditures) | Receiver reasonably sought documents and attempted to meet-and-confer per Trial Rule 26(F); receiver is an officer of the court and authorized to seek information | No formal discovery served; meet-and-confer inadequate; order improperly permits receiver to contact represented board members (Rule 4.2) | Affirmed grant; receiver demonstrated reasonable efforts to confer, the trial court supervises receiver communications, and appellants failed to show prejudice |
| 4. Order requiring Towne & Terrace to pay one-half of receiver’s expenses | Equitable sharing appropriate because Towne & Terrace’s noncooperation and resident delinquencies increased costs and delayed remediation | City (not Towne & Terrace) caused dilapidation by owning and abandoning many units; it is inequitable to charge Towne & Terrace half | Affirmed; court found Towne & Terrace’s conduct and community‑wide issues justified splitting costs and did not abuse discretion |
Key Cases Cited
- City of Indianapolis v. Towne & Terrace Corp., 106 N.E.3d 507 (Ind. Ct. App. 2018) (affirming summary judgment for Towne & Terrace and rejecting City’s nuisance/refund theory)
- Towne & Terrace Corp. v. City of Indianapolis, 122 N.E.3d 846 (Ind. Ct. App. 2019) (reversing receivership under the Unsafe Building Law and limiting receivership over nonparties)
- Tom-Wat, Inc. v. Fink, 741 N.E.2d 343 (Ind. 2001) (interlocutory appeal presents all issues encompassed by the order)
- In re Walker, 665 N.E.2d 586 (Ind. 1996) (failure to include transcript waives claims that depend on the evidence)
- Kocher v. Getz, 824 N.E.2d 671 (Ind. 2005) (appellant’s burden to provide transcript when challenging discretion at hearing)
- Care Grp. Heart Hosp., LLC v. Sawyer, 93 N.E.3d 745 (Ind. 2018) (trial courts have broad discretion to manage discovery; discovery rulings reviewed for abuse)
- Harbour v. Arelco, Inc., 678 N.E.2d 381 (Ind. 1997) (interlocutory appeals review all issues properly raised by the order)