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Hi-Tec Propertoes, LLC v. Murphy

Court of Appeals of Indiana

July 21, 2014

HI-TEC PROPERTIES, LLC, Appellant-Defendant,

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[Copyrighted Material Omitted]

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APPEAL FROM THE MARSHALL CIRCUIT COURT. The Honorable Curtis D. Palmer, Judge. Cause No. 50C01-1002-CT-4.

ATTORNEY FOR APPELLANT: JERE L. HUMPHREY, Wyland, Humphrey, Wagner & Clevenger, LLP, Plymouth, Indiana.

ATTORNEY FOR APPELLEES: DOUGLAS D. SMALL, Foley & Small, South Bend, Indiana.

CRONE, Judge. BAKER, J., and BARNES, J., concur.


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CRONE, Judge

Case Summary

Hi-Tec Properties, LLC (" Hi-Tec" ), appeals the trial court's denial of its motion to correct error following a jury verdict and award of compensatory and punitive damages entered in favor of Brittany Murphy, Kendall Murphy, Lorie Murphy, and Jay Frazier (collectively " Plaintiffs" ) on their claims for negligence, breach of contract, and fraud against Hi-Tec. Hi-Tec filed a motion to correct error claiming, in essence, that the jury verdict and resulting award of damages was improper and unsupported by the evidence. The trial court denied the motion, and Hi-Tec appealed. Finding a portion of the compensatory damages award to be unsupported by the evidence, we reverse that portion of the award and remand to the trial court with instructions for revision. We affirm the trial court in all other respects.

Facts and Procedural History

The relevant facts most favorable to the verdict indicate that Hi-Tec owns an apartment complex in Plymouth, Indiana. The Hi-Tec complex consists of five buildings with twelve apartments each. Of those twelve apartments in each building, four apartments are below-grade. The below-grade apartments have dehumidifiers to remove moisture from the air, and tenants in those apartments are given a twenty-dollar-per-month rent deduction to defray electrical costs for running the dehumidifiers.

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In August 2009, nineteen-year-old Brittany Murphy and her friend Jay Frazier were enrolled at Ancilla College, a two-year college in Marshall County. Brittany planned to play basketball for Ancilla. Brittany and Jay decided that they would share an apartment during college. Jay traveled to Hi-Tec and met with the on-site apartment manager, Karma Murray, who showed him available units. On a second trip, Brittany also looked at the units. Brittany and Jay decided to share one of the below-grade Hi-Tec apartments. On August 15, 2009, Brittany and her father Kendall Murphy met with Murray, and both signed the lease agreement to rent apartment number 1383, a below-grade apartment. Although the lease named Brittany and her mother, Lorie Murphy, as " Lessee[s]," Lorie was not present that day and did not sign the lease agreement. Appellant's App. at 83.[1]

The lease agreement signed by Brittany and Kendall included the following clause:

23. Mold. Lessee acknowledges that no evidence of mold was observed in the living unit prior to leasing. Lessee also agrees to notify Lessor in writing within ten (10) days of observing any mold. Lessor shall then have two (2) weeks within which to remediate the conditions at no cost to Lessee. As part of the consideration of this lease, Lessor shall have no personal liability for personal injury or property damage as a result of any mold, fungus, etc. ... Lessor agrees to clean the mold, fungus, etc., from the personal property of Lessee but shall not be liable for any expenses for Lessees having a third party clean or sanitize the personal property or unit. However, if the mold, fungus, etc. develops because of the Lessee's use of the unit in a way likely to heighten the risk of mold, then Lessor shall have no obligation for cleaning personal property. In any event, Lessee releases and agrees to save harmless, Lessor and their agents for personal injury and suffering, mental anguish, medical expenses, lost wages, etc., to themselves and or family members.

Id. at 69 (emphases added).

Thereafter, Brittany and Jay moved into the apartment and lived there. Brittany paid the rent with the help of her parents. Jay would " help out when he could." Tr. at 276. In late September, Brittany complained to Lorie that she " didn't feel good ... was tired all the time ... felt congested ... just did not feel good." Id. at 151. Brittany began feeling even worse in October. She lacked energy and had trouble running at basketball practice. Jay was congested and feeling bad too. Brittany and Jay both had a history of exertion-induced asthma and felt like their asthma symptoms had increased. On Friday, November 6, 2009, Brittany spoke to Lorie on the telephone and, because Brittany and Jay had not been feeling well, Lorie advised Brittany to open the windows in the apartment to get some fresh air. That Sunday, Brittany went to open her bedroom window and discovered mold in the window frame. There was also mold growing on the window side of the blinds. Jay found mold growing on his window frame as well, but not as much as in Brittany's bedroom. Brittany called Lorie, who instructed her to clean the mold with a bleach and water mixture. After cleaning the mold, Lorie called Murray and told her about the mold and asked her advice on how Brittany should clean it.

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Murray claimed to have no idea how to clean or deal with mold. However, based upon Murray's advice, Jay wrote a letter alerting Hi-Tec to the mold they had discovered in the apartment. Hi-Tec agreed to move Brittany and Jay to an above-grade apartment.

The next weekend, Kendall and Lorie traveled to Plymouth to help Brittany and Jay move to the new apartment. During that week, new mold grew back on the frames of the bedroom windows. Lorie took pictures of the mold and also brought Murray to the apartment to show her the mold. Brittany and Lorie signed a new lease agreement for the rental of an upstairs apartment. During the move, some of Brittany's apartment items and clothing had to be thrown away and other items had to be cleaned. After moving, Brittany continued to experience increased asthma symptoms and headaches. Brittany's family physician, Dr. William Goudy, believed that the mold exposure made Brittany's asthma worse. An infectious disease physician who evaluated Brittany opined that, regarding her increased asthma symptoms, it was " more possible that she is recovering from an allergic reaction ...

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