Kay Kim and Charles Chuang v. Village at Eagle Creek Homeowners Association, Inc. and Muhammed Javed and Andleeb Javed

FILED Oct 17 2019, 8:45 am

CLERK Indiana Supreme Court Court of Appeals and Tax Court

APPELLANTS PRO SE ATTORNEY FOR APPELLEE Kay Kim VILLAGE AT EAGLE CREEK Charles Chuang HOMEOWNERS ASSOCIATION, Indianapolis, Indiana INC. David E. Jacuk Tanner Law Group Indianapolis, Indiana ATTORNEY FOR APPELLEES MUHAMMED JAVED AND ANDLEEB JAVED Steven St. John Skiles DeTrude Indianapolis, Indiana

IN THE COURT OF APPEALS OF INDIANA

Kay Kim and Charles Chuang, October 17, 2019 Appellants-Plaintiffs, Court of Appeals Case No. 19A-SC-970 v. Appeal from the Marion County Small Claims Village at Eagle Creek Court Homeowners Association, Inc. The Honorable and Muhammed Javed and A. Douglas Stephens, Judge Andleeb Javed, Trial Court Cause No. Appellees-Defendants. 49K05-1811-SC-4090

Kirsch, Judge. Court of Appeals of Indiana | Opinion 19A-SC-970 | October 17, 2019 Page 1 of 7 [1] Kay Kim and Charles Chuang (together, “Plaintiffs”) appeal the small claims

court’s order dismissing their small claims action against the Village at Eagle

Creek Homeowners Association, Inc. (“VEC”) and Muhammed Javed and

Andleeb Javed. The Plaintiffs raise several issues for our review, which we

restate and consolidate as: whether the small claims court erred when it

dismissed Plaintiffs’ small claims action with prejudice for failure to attend

mediation. [2] We reverse and remand.

Facts and Procedural History [3] This case arises from an incident in which Plaintiffs’ dogs were allegedly bitten

by another dog in the outside common area of their condominium complex.

The dog that allegedly bit their dogs was owned by tenants of a unit in the

complex. On November 7, 2018, Plaintiffs filed a small claims action against

VEC, seeking damages for the treatment sought for their dogs. Appellants’ App.

Vol. II at 22. On December 13, 2018, VEC filed a motion to dismiss. Id. at 14.

Plaintiffs opposed the motion and later added Muhammed Javed and Andleeb

Javed (“the Javeds”), the owners of the unit where the dog that allegedly bit

their dogs resided, thus making VEC and the Javeds defendants (collectively,

“Defendants”). Id. at 14-16. [4] On December 28, 2018, the small claims court denied VEC’s motion to dismiss

and ordered the parties to alternative dispute resolution, which included

mediation or arbitration. Appellees’ App. Vol. 2 at 2. On January 28, 2019, the

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small claims court provided a panel of four mediators, from which the parties

were to each strike one. Id. at 5. After the small claims court had provided this

list, Plaintiffs filed their own list of mediators, which was stricken by the small

claims court the same day. Appellants’ App. Vol. II at 19, 82-83. Despite being

ordered to participate in mediation, Plaintiffs filed a motion for summary

judgment on February 25, 2019, which was stricken by the small claims court.

Id. at 19. [5] After the parties each struck a mediator from the panel provided by the small

claims court, Mark Matheny (“Matheny”) was the remaining proposed

mediator and was appointed to the case on February 28, 2019. Id. On March

13, 2019, Matheny contacted the parties to obtain a date for mediation and

explained his fee schedule. Id. at 91. He explained that his fee was $200 per

hour which was to be split equally between the parties and that a retainer of

$300 was to be paid by both sides. Id. Shortly after receiving Matheny’s email,

Plaintiffs responded that the mediation fee of $200 per hour was to be split

among the three parties and that Plaintiffs’ portion of the fee should not exceed

more than $70. Id. at 92. Plaintiffs further informed Matheny that their

demand of $591 plus court costs and mediation costs was not negotiable and

“will not change.” Id. Twenty-one minutes later, Plaintiffs emailed Matheny,

again reiterating their position and stating that they would not pay more than

$70 for mediation and that they would walk out of mediation within the first

half hour. Id. at 93. Three minutes after this second email, Plaintiffs emailed

Matheny, informing him that they would bring two checks of $35 to the

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mediation so that one check could be given back after a half hour of mediation.

Id. [6] On March 18, 2019, Matheny filed a “Report of Mediator and Resignation of

Mediator” with the small claims court. Id. at 94. In the report, Matheny stated

that “Plaintiff, Kay Kim, has indicated that she would not be participating in

the mediation under the terms set forth in the mediator’s Agreement to

Mediate.” Id. He further informed the court that due to the correspondence

between Plaintiffs and himself, he felt that he was “now in an adversarial

relationship with the Plaintiff[s] and can no longer act as mediator in this cause

of action and would tender his resignation as mediator.” Id. Matheny

additionally stated that “no mediation ha[d] taken place, no mediation ha[d]

been scheduled, nor ha[d] the parties agreed to the terms of mediation at this

point.” Id. [7] On March 20, 2019, the small claims court sua sponte set a Rule to Show Cause

hearing and ordered Plaintiffs to appear and show cause as to why they should

not be held in contempt for failing to attend mediation; if Plaintiffs failed to

appear and show good cause, the action could be dismissed. Appellees’ App. Vol.

2 at 7-8. Plaintiffs filed an answer to the Rule to Show Cause order and, for the

first time, requested a pro bono mediator be appointed. Appellants’ App. Vol. II

at 98. On April 26, 2019, the parties appeared at the Rule to Show Cause

hearing, and the small claims court heard evidence. At the conclusion of the

hearing, the small claims court issued an order dismissing Plaintiffs’ case with

prejudice, finding that Plaintiffs “refuse to attend court-ordered mediation” and

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that Plaintiffs “want to set the cost of mediator and indicate they will not

change [their] position.” Id. at 8. Plaintiffs now appeal.

Discussion and Decision [8] Plaintiffs argue that the small claims court erred when it dismissed their action

against Defendants with prejudice based on Plaintiffs’ refusal to attend

mediation. Because the small claims court’s decision was not in Plaintiffs’

favor, they are appealing from a negative judgment. On appeal, we will not

reverse a negative judgment unless it is contrary to law. Johnson v. Blue Chip

Casino, LLC, 110 N.E.3d 375, 378 (Ind. Ct. App. 2018) (citing LTL Truck Serv.,

LLC v. Safeguard, Inc., 817 N.E.2d 664, 667 (Ind. Ct. App. 2004)), trans. denied.

In determining whether a judgment is contrary to law, we consider the evidence

in the light most favorable to the appellee, together with all the reasonable

inferences to be drawn therefrom. Id. A judgment will be reversed only if the

evidence leads to but one conclusion, and the trial court reached the opposite

conclusion. Id. [9] The small claims court dismissed Plaintiffs’ case after finding that Plaintiffs

“refuse to attend court-ordered mediation” and that Plaintiffs “want to set the

cost of mediator and indicate they will not change [their] position.” Appellants’

App. Vol. II at 8. However, although the small claims court ordered the parties

to alternative dispute resolution, including mediation or arbitration, and the

Plaintiffs failed to comply with mediation, pursuant to the Indiana Rules for

Alternative Dispute Resolution, they are not applicable to small claims court

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cases. Indiana Rule for Alternative Dispute Resolution 1.4 states, “[t]hese rules

shall apply in all civil and domestic relations litigation filed in all Circuit,

Superior, County, Municipal, and Probate Courts in the state.” The Marion

County small claims courts are not included in this rule; therefore, cases filed in

these courts are not subject to the rules, and the parties in these cases cannot be

ordered to alternative dispute resolution, including mediation or arbitration. In

the present case, therefore, contrary to the order by the small claims court, the

parties could not be ordered to mediation.1 [10] Under Indiana Small Claims Rules, the “sole objective” of the informal

proceedings is “dispensing speedy justice between the parties according to the

rules of substantive law” and the proceedings “shall not be bound by the

statutory provisions or rules of practice, procedure, pleadings or evidence . . . .”

Ind. Small Claims Rule 8(A). We find that the inapplicability of the Indiana

Alternative Dispute Rules to small claims cases furthers this objective in that

barring alternative dispute resolution streamlines the small claims procedure

and brings about “speedy justice between the parties.” Id. Because the Indiana

Alternative Dispute Rules are not applicable to small claims cases in Marion

County, we find that the small claims court in the present case erred when it

1 Although we hold that parties cannot be ordered to participate in alternative dispute resolution in Marion County small claims proceedings, our holding does not bar parties in those small claims proceedings from being compelled to participate in alternative dispute resolution when they have contracted to be subject to such processes.

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dismissed Plaintiffs’ case for refusing to attend mediation. We, therefore,

reverse the small claims court’s dismissal and remand for further proceedings. [11] Reversed and remanded.

Baker, J., and Crone, J., concur.

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