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Song v. Iatarola

Court of Appeals of Indiana

March 19, 2019

Cheng Song, Appellant-Plaintiff,
v.
Thomas Iatarola and Theresa Iatarola, Appellees-Defendants.

          Appeal from the Porter Superior Court Trial Court Cause No. 64D02-1109-PL-9151 The Honorable Roger V. Bradford, Special Judge

          Attorneys for Appellant Robert A. Welsh Connor H. Nolan Harris Welsh & Lukmann Chesterton, Indiana

          Attorney for Appellees C. Anthony Ashford Ashford Law Group, P.C. Valparaiso, Indiana

          Najam, Judge.

         Statement of the Case

         [¶1] Cheng Song appeals the trial court's order denying his request for attorney's fees. Song presents three issues for our review, which we consolidate and restate as one issue, namely, whether the trial court erred when it denied his request for attorney's fees. We reverse and remand with instructions.

         Facts and Procedural History

         [¶2] This is the second appeal in this matter. In our prior opinion, we set out the facts and procedural history as follows:

In 1998, the Iatarolas purchased thirty-four acres of land that was zoned for agricultural use. Thomas [Iatarola] built several structures on the property to warehouse equipment and inventory from his telecommunications and classic car sales business.
The land, which was adjacent to the Porter County Airport, was mortgaged. The Iatarolas decided to try to sell ten acres of their land to reduce or repay their debt to the bank. Thomas and Theresa [Iatarola] agreed between themselves that Thomas would take charge of arranging for the sale of their land, and he acted as an agent on behalf of his wife from September 2010 through September 2011. On September 14, 2010, Thomas retained Robert Macmahon as their exclusive real estate agent for the sale of the ten acres.
On September 14, 2010, Macmahon showed Thomas a listing agreement for the real estate sale. The form was entitled "Listing Contract (Exclusive Right to Sell) Commercial-Industrial Real Estate"; under the section entitled "Seller's Representations," the property is stated to be zoned I-2 Industrial. Macmahon asked Thomas to review the listing to ensure its accuracy and asked both Thomas and Theresa to initial each page of the listing agreement to verify that they read it and that it was accurate. Thomas did so, but Theresa refused to sign her initials because the listing inaccurately stated that the zoning was I-2 Industrial rather than Agricultural. Theresa told Thomas that her reason for not initialing the listing and told him to have Macmahon correct the listing error.
A few days later, Thomas told Theresa that he had spoken with Macmahon and that the listing had been corrected. Theresa did not see or initial a corrected listing. On or around September 14, 2010, Macmahon began advertising the real estate online. The advertisements stated that the land was zoned I-2 Industrial and that it was suitable for warehousing and other light industrial uses.
In December 2010, Song saw online the advertisement for the sale of the ten acres of land. At this time, Song was a New Jersey resident who wanted to buy industrial real estate in northwest Indiana to use for an imported tool business he wanted to start. Song arranged a meeting with Macmahon to take place on December 31, 2010, to visit two industrially zoned properties, one of which was the Iatarolas' land. During their meeting, Song told Macmahon that he wanted to buy property that had buildings suitable for warehousing for an imported tool business, and they discussed Song's ability to expand and build additional industrial warehousing on the property. In an internet advertisement that has Macmahon's handwriting on it, the property's type is described as "Industrial For Sale"; the property overview states that the land is "in an established industrial area."
Also on December 31, 2010, Song told the Iatarolas of his intended use of the property he wanted to purchase. That same day, Song signed a purchase agreement with the Iatarolas to buy their ten acres for $600, 000. The contract was entitled "Purchase Agreement Commercial-Industrial Real Estate."
Sometime before the signing, the Porter County Airport had stated that it might impose a runway protection zone in this property to comply with Federal Aviation Administration ("FAA") requirements. The purchase agreement included a contingency clause that stated, "This agreement is contingent upon the Buyer's agreement with the final approval of FAA regarding land use." After reviewing the airport's proposal, Song worried that the runway protection zone could lead to a governmental taking of part of the property that he was purchasing, the removal of some of the warehousing buildings, or a restriction on the height of future construction. On January 6, 2011, he exercised his contingency right and terminated the purchase agreement.
For the next two and one-half months, Song and Thomas negotiated a new sale of a different part of the Iatarolas' land. On March 21, 2011, they signed a second purchase agreement for sixteen acres, which included most of the original ten acres with the warehousing buildings plus additional acres of land outside the potential runway protection zone. This second purchase agreement was entitled "Purchase Agreement Commercial-Industrial Real Estate." It required $150, 000 in earnest money and included a provision for liquidated damages of $150, 000 if either party breached the contract. Song and Thomas signed an addendum to the second purchase agreement that provided:
Closing date will be predicated on the Seller's ability to vacate and exit the subject property. A maximum of 180 days ("Due Diligence Period") from the day of acceptance of this contract, has been agreed by both parties. When the seller advises the Buyer in writing, that the exit is ...

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