Dr. Curtis K. Deason and Connie S. Deason, Appellants-Defendants,
Bill R. McWhorter and Heather McWhorter Revocable Living Trust, Dated January 24, 2003, Appellee-Plaintiff.
from the Howard Superior Court The Honorable A. Christopher
Lee, Special Judge Trial Court Cause No. 34D02-1505-PL-407
Attorneys for Appellants Justin K. Clouser Jeffrey M. Miller
Noel Law Kokomo, Indiana
Attorney for Appellee T. Andrew Perkins Peterson Waggoner
& Perkins, LLP Rochester, Indiana
Dr. Curtis K. Deason and Connie S. Deason (together,
"the Deasons") appeal the trial court's order
awarding judgment in favor of the Bill R. McWhorter and
Heather McWhorter Revocable Living Trust, Dated January 24,
2003, ("the Trust") for damages after the Deasons
defaulted on a contract for sale of real estate. The Deasons
raise several issues for our review that we consolidate and
restate as: whether the trial court inappropriately awarded
the Trust a remedy of foreclosure in contradiction to the
language of the contract for sale of real estate.
We reverse and remand.
and Procedural History
On March 18, 2009, the Deasons and the Trust entered into a
Conditional Contract for Sale of Real Estate ("the
Contract") to facilitate the Deasons' purchase of
real property including a residence located at 3473 S. 150 E.
in Kokomo, Indiana ("the Property") for the amount
of $490, 000.00. Over the course of several years, the
Deasons made a total of thirty-seven installment payments of
$2, 923.31 each, as well as a down payment and earnest money
payment of $25, 500.00. Appellants' App. Vol. 2
at 81. The remaining balance on the Contract was $462,
500.00. Id. The total of all installment payments
towards the value of the Contract was $108, 162.47.
Id. The remaining balance on the Contract after all
payments were applied equaled $445, 442.07, approximately 4%
of the total purchase price. Id. at 82.
Pursuant to the Contract, the entire remaining balance owed
was due in a single balloon payment on April 18, 2012.
Id. at 58. The Deasons were unable to make the
balloon payment and, instead, tendered a regular monthly
payment, which breached the Contract. At trial, the
parties' testimony diverged on the topic of whether Bill
McWhorter ("McWhorter"), as trustee, was informed
of the Deasons' intent to leave the Property. McWhorter
testified that the Deasons never asked him about staying on
the Property even though they could not pay the balloon
payment and that the Deasons never told him that they would
be leaving. Tr. Vol. 2 at 119-20. McWhorter
testified that the only thing he told the Deasons was
"we have to live by what's in the [C]ontract."
Id. at 119. Curtis Deason testified that he informed
McWhorter that the Deasons would be leaving and stated that
McWhorter told them to leave the premises by May 18, 2012.
Id. at 136-37. The Trust, through McWhorter, took
possession of the Property shortly after the Deasons left on
or around May 18, 2012. Id. at 59. After the Deasons
moved from the Property, McWhorter had the locks changed, and
he began living in the home. Id. at 121. Since May
2012, when McWhorter took possession of the Property, it has
been titled in his name alone. Id. at 59, 130.
On May 27, 2015, the Trust filed a complaint against the
Deasons for damages resulting from the Deasons' breach of
the Contract. The Trust sought foreclosure and a judgment
consisting of "the outstanding unpaid principal balance,
together with interest from and after the date of the
default, late charges, default-related expenses and advances,
reasonable attorney fees and costs of this action, and all
other expenses incurred in connection with this cause."
Appellants' App. Vol. 2 at 28. A bench trial was
held on October 17, 2017. At trial, the Trust presented two
expert witnesses to testify regarding the value of the
Property, and one of the experts testified that the Property
had an appraised value of $316, 000.00. Tr. Vol. 2
at 38. To support their valuation of the Property, the
Deasons submitted an order from McWhorter's dissolution
case that ordered that the Property be listed for sale in the
amount of $450, 000.00 and the Trust's insurance policy
on the Property. Appellants' App. Vol. 2 at 45;
Tr. Vol. 2 at 127.
The trial court also heard evidence of physical damage that
the Trust discovered after it took possession of the Property
from the Deasons. Much of this evidence came in over the
Deasons' continuing objection. Additionally, the Trust
offered evidence of the attorney fees it had incurred in
bringing the breach of contract action. On January 11, 2018,
the trial court issued its "Judgment, Findings of Fact
and Conclusions of Law," which entered judgment for the
Trust and against the Deasons in the amount of $153, 335.24
and foreclosed and extinguished the Deasons' interest in
the Property. Appellants' App. Vol. 2 at 25. The
trial court reached this amount by applying the balance of
the Contract purchase price, unpaid taxes, repairs, and
attorney and legal fees, and then subtracting the value of
the Property, which it found to be $316, 000.00. Id.
at 23-25. The Deasons now appeal.
When a trial court has made findings of fact, we review the
sufficiency of the evidence using a two-step process.
Huber v. Sering, 867 N.E.2d 698, 706 (Ind.Ct.App.
2007), trans. denied. We first determine whether the
evidence supports the trial court's findings of fact, and
then we determine whether those findings of fact support the
trial court's conclusions of law. Id. We will
set aside the findings only if they are clearly erroneous.
Id. Findings are clearly erroneous only when the
record contains no facts to support them either directly or
by inference. Campbell v. Campbell, 993 N.E.2d 205,
209 (Ind.Ct.App. 2013), trans. denied. A judgment is
clearly erroneous if it applies the wrong legal standard to
properly found facts. Id. In applying this standard,
we neither reweigh the evidence nor judge the credibility of
the witnesses. Merrillville 2548, Inc. v. BMO Harris Bank
N.A., 39 N.E.3d 382, 389 (Ind.Ct.App. 2015), trans.
denied. Rather, we consider the evidence that supports
the judgment and the reasonable inferences to be drawn
therefrom. Id. To make a determination that a
finding or conclusion is clearly erroneous, our review of the
evidence must leave us with the firm conviction that a
mistake has been made. Kieffer v. Trockman, 56
N.E.3d 27, 33 (Ind.Ct.App. 2016).
The Deasons argue that the trial court's order was
clearly erroneous because it awarded the Trust both
forfeiture and foreclosure remedies. They contend that the
Trust, through its actions after the Deasons defaulted on the
Contract, elected a remedy of forfeiture, which was the
remedy warranted by the language in the Contract. They also
assert that because the Trust elected a forfeiture remedy, it
was barred from also seeking a remedy of ...