Automotive Finance Corporation d/b/a AFC Automotive Finance Corporation d/b/a AFC, v. Meng Liu,
Case No. 23A-CC-1468
COURT OF APPEALS OF INDIANA
February 15, 2024
The
Trial Court Cause No. 49D04-2009-CC-33233
ATTORNEY FOR APPELLANT
Joshua W. Casselman
Rubin & Levin, P.C.
Indianapolis, Indiana
ATTORNEY FOR APPELLEE
Randall R. Shouse
Shouse & Langlois
Indianapolis, Indiana
Opinion by Judge Bradford
Judge Vaidik concurs.
Judge Brown dissents with opinion.
Bradford, Judge.
Case Summary
[1] Automotive Finance Corporation (“AFC“) sued Meng Liu based on Liu‘s alleged personal guaranty of a promissory note that was in default. In response, Liu claimed that she had not personally signed the guaranty and that her co-defendant ex-husband, Ning Ao, had defrauded her. AFC moved for summary judgment, which motion the trial court granted. Liu appealed, arguing that the judgment should not be enforced against her because Ao had forged Liu‘s signature on the guaranty; however, we dismissed that appeal on procedural grounds. Subsequently, Liu moved to set aside the summary-judgment order under
Facts and Procedural History
[2] Ao and Liu were once married but separated in 2017 and were divorced sometime
[3] Shortly after AFC filed its complaint, Liu disputed her liability under the Guaranty. On October 15, 2020, Liu filed a pro-se letter with the trial court in which she alleged that Monmars was “Ao‘s company[,]” she and Yang “did not sign the agreement with the AFC or did so without our knowledge[,]” “Ao signed an agreement, agreeing to assuming all of AFC‘s liabilities” in connection with their marriage-dissolution agreement, and she was not “obligated to undertake the AFC debt.” Appellant‘s App. Vol. II p. 49. That same day, Ao filed a pro-se letter with the trial court stipulating that Liu and Yang were “not involved in any business with Monmars [...], nor ha[d] they signed with the AFC.” Appellant‘s App. Vol. II p. 59.
[4] In March of 2022, AFC moved for partial-summary judgment on Counts I and II of the complaint against Monmars, Liu, Ao, and Yang for breach of the Note and Guaranty. AFC also designated affidavits from three persons: (1) Senior Collection Manager Joshua Risch; (2) Desire Gideons, the notary public who had notarized the Note and Guaranty; and (3) AFC‘s counsel regarding the attorney fees and expenses that AFC had incurred in connection with the case. In his affidavit, Risch testified, inter alia, that AFC had provided floorplan financing to Monmars; Monmars had failed to pay AFC in accordance with the Note; and Liu, Ao, and Yang guaranteed payment of the Note in the Guaranty. In her affidavit, Gideons testified that she had witnessed Liu, Ao, and Yang sign the Guaranty on October 5, 2018. On April 5, 2022, the trial court informed Monmars, Liu, Ao, and Yang that, in accordance with
[5] On April 13, 2022, in response to AFC‘s summary-judgment motion, Liu filed another pro-se letter disputing her liability under the Guaranty because of Ao‘s “confession letter[,]” in which he states that he had used Liu‘s social-security number “to apply for the loan of AFC[,]“had not clearly explained to her what AFC is, and had helped her sign the Note and Guaranty. Appellant‘s App. Vol. II p. 122. According to Liu, this letter proved that she had not been aware of “this loan from AFC” and that Ao had “simply explained that his company needed a signature from an American citizen.” Appellant‘s App. Vol. II p. 121. Neither this confession letter nor Liu‘s April 13, 2022, pro-se filing had been signed under oath. Further, neither Liu nor her co-defendants designated evidence opposing AFC‘s summary-judgment motion or filed responses in compliance with
[6] On September 23, 2022, the trial court conducted a hearing on AFC‘s summary-judgment motion, at which a Mandarin interpreter was present to assist Liu and Yang. After the hearing, the trial court awarded AFC partial-summary judgment in the amount of $163,097.99 plus costs, against Monmars, Liu, Ao, and Yang (who were found to be jointly and severally liable), finding that “[t]he designated evidentiary matter shows that there is no genuine issue of material fact and [AFC] is entitled to judgment as a matter of law” on
[7] While the First Appeal was pending, Liu challenged AFC‘s right to garnish certain deposit accounts held in her name. On November 16, 2022, the trial court ordered the release of some of these deposit accounts, with the exception of $20,000.00 in one account, which the trial court stated was “to be held for her creditor, AFC.” Appellant‘s App. Vol. II p. 144. The trial court, however, never issued a final garnishment order in favor of AFC as to these funds.
[8] Regarding the remaining $20,000.00 being held for AFC, Liu filed an additional pro-se request asking that the funds be “refund[ed]” to her on December 6, 2022. Appellant‘s App. Vol. II p. 13. AFC requested a hearing for a final garnishment ordered, which the trial court scheduled for January 9, 2023; however, Liu had retained counsel who secured a continuance until March 28, 2023. At the March 28, 2023 hearing, Liu appeared with counsel and the trial court ordered Liu “to file a motion for exemption hearing[,]” which her counsel did. Appellant‘s App. Vol. II p. 17. The trial court scheduled this exemption hearing for May 3, 2023.
[9] At the May 3, 2023 exemption hearing, the trial court did not limit evidence to determining which, if any, exemptions applied to Liu‘s $20,000.00 deposit account. Despite AFC‘s objection and the fact that Liu‘s appeal had been dismissed and that she had not yet filed a
this whole case has been involved with allegations of all kinds of fraud and I have to get to the bottom of it before we ever go back to the garnishment hold posture that we were in in proceeding supplemental court. That‘s the reason that I‘m hearing it instead of the usual proceeding[] supplemental judge in the first place, so I‘m gonna (sic) overrule your objection to Ning Ao testifying about what happened with the original note and who got the money.
Tr. Vol. II p. 7.
[10] In response to questioning from the trial court, Ao testified that he had used Liu‘s name and information to apply for the loan for AFC, the loan had funded Monmar‘s account, and Ao had found “two foreign students from China and have (sic) them sign on behalf of Xiaoqiao Yang and Meng Liu” using Yang‘s and Ming‘s identification cards. Tr. Vol. II p. 10. Additionally, Liu testified that she had not signed or cosigned for any loan. At the conclusion of the hearing, the trial court set a deadline of May 12, 2023, to file a motion relating to the underlying judgment and another deadline in June of 2023 for the parties to submit proposed orders related to Liu‘s exemption request.
[11] On May 10, 2023, Liu moved for relief from the entry of partial-summary judgment in favor of AFC based on Ao‘s testimony at the exemption hearing. Liu alleged in her motion that “subsequent to the entry of summary judgment, newly discovered evidence of fraud has been presented to the court, pursuant to
[12] In June of 2023, the trial court granted Liu relief from summary judgment, finding that Ao had “admitted under oath that the signatures on the loan application [...] were forged” and had further acknowledged that Liu “received no benefits” from the loan. Appellant‘s App. Vol. II p. 23. Based on that testimony, the trial court concluded that Liu had met her burden of showing that she had a meritorious defense under
[13] In addressing AFC‘s argument that the prior dismissal of the First Appeal had precluded Liu‘s
Discussion and Decision
[14] ”
A. Trial Rule 60(B)(3) Standard
[15] “Indiana courts applying the ‘fraud’ provision of subsection (B)(3) of
[16] AFC argues that the trial court applied the wrong standard to Liu‘s motion for relief from summary judgment. We disagree. The trial court concluded that “Liu had the burden of proving that the trial [c]ourt erred in determining that there were no genuine issues of material fact” and that “she had a meritorious defense.” Appellant‘s App. Vol. II pp. 23–24. Moreover, the trial court noted at the exemption hearing that “this whole case has been involved with allegations of all kinds of fraud and I have to get to the bottom of it[.]” Tr. Vol. II p. 7. Ao testified that he had fraudulently “used [Liu‘s] information to apply for the loan” and she “did not know anything” about it. Tr. Vol. II p. 9.
[17] Additionally, we cannot say that the trial court abused its discretion in concluding that Liu had established a meritorious defense.1 Ao‘s “undisputed
testimony” that he had committed fraud points to a judgment contrary to that entered by the trial court. Appellant‘s App. Vol. II p. 24. In this case, Liu and Yang provided letters to the trial court that notified the court of Ao‘s alleged fraud and Ao himself testified to this at the May 3, 2023 exemption hearing. As a result, the trial court concluded that Liu had met her burden of showing a meritorious defense.
[18] Based on Ao‘s testimony that he fraudulently used Liu‘s information to obtain the loan from AFC, our deference to trial courts regarding
B. Dismissal of the First Appeal
[19] AFC also argues that the trial court abused its discretion in holding that the dismissal of the First Appeal had not precluded her filing of a
[20] In making its argument, AFC cites Indiana‘s well-established principle that “[o]ne cannot sit idly by and let the time for appeal elapse, thereafter file a 60([B]) motion and thereby revive his expired remedy of appeal.” Id. For example, AFC cites S.E. v. State, 744 N.E.2d 536, 538 (Ind. Ct. App. 2001), in which a defendant appealed a judgment against him, but failed to file the praecipe to perfect his appeal. The defendant then attempted to file a
[21] In the First Appeal, Liu had attempted a pro-se appeal of the summary-judgment order against her; however, after
[22] The judgment of the trial court is affirmed.
Vaidik, J., concurs.
Brown, J., dissents with opinion.
Brown, Judge, dissents with opinion.
[23] I respectfully dissent from the majority‘s decision that the trial court did not err in granting Liu‘s motion for relief from judgment. It is well settled that litigants who proceed pro se are held to the same standard as trained counsel and are required to follow procedural rules. Evans v. State, 809 N.E.2d 338, 344 (Ind. Ct. App. 2004), trans. denied.
[24] AFC filed its complaint in September 2020 and its motion for partial summary judgment on March 30, 2022, and the court issued an order dated March 31, 2022, and stamped as filed on April 5, 2022, stating: “Comes now the plaintiff and files its Motion for Partial Summary Judgment, and in accordance with
[25]
[26] Moreover, the Indiana Supreme Court has held that, when applying the “fraud” provision of
subsection (b)(3) creates a limited exception to the general rule of finality of judgments. If a party cannot show that fraud, misrepresentation, or misconduct substantially prejudiced the party‘s presentation of the party‘s case, a court should not set aside an otherwise final judgment.” Id.
[27] In her motion for relief from judgment citing
[28] For the foregoing reasons, I would find the trial court erred in granting Liu‘s motion for relief from judgment under