ACCREDITED HOME LENDERS INC. v. MOORE

ACCREDITED HOME LENDERS, INC., Plaintiff,

v.GLORIA M. MOORE, Personal Representative

of Estate of James Sedric a/k/a Sedric L. James,

Deceased, JOHN DOE, JANE DOE, and

MORTGAGE ELECTRONIC REGISTRATION

SYSTEMS, INC., as Nominee for HSBC Mortgage Defendants,

CYRIL B. HUERTER, Appellant/Intervenor/Cross Claimant,

v.ESTATE OF JAMES SEDRIC a/k/a SEDRIC L.

JAMES, Deceased, Appellee/Cross Defendant.

No. 45A03-1004-MF-229

COURT OF APPEALS OF INDIANA

FILED: April 1, 2011

Pursuant to Ind.Appellate Rule 65(D), this Memorandum Decision shall not be regarded as precedent or cited before any court except for the purpose of establishing the defense of res judicata, collateral estoppel, or the law of the case.

ATTORNEY FOR APPELLANT:

KENNETH M . WILK

Highland, Indiana

ATTORNEY FOR APPELLEE:

YOLANDA HOLDEN

Robert L. Lewis & Associates

Gary, Indiana

APPEAL FROM THE LAKE SUPERIOR COURT

The Honorable William E. Davis, Judge

Cause No. 45D05-0607-MF-212

MEMORANDUM DECISION - NOT FOR PUBLICATION

MATHIAS, Judge

Cyril Huerter ("Huerter") intervened in a mortgage foreclosure action filed in Lake Superior Court between Accredited Home Lenders, Inc. and the Estate of James Sedric ("the Estate"). Huerter had sold the real estate at issue in the foreclosure action to James Sedric¹ ("Sedric") before his death. In his complaint to quiet title, Huerter claimed that Sedric had not paid the $100,000 sale price for the property. After a bench trial, the trial court concluded that Sedric had not breached the contract and entered a judgment in favor of the Estate. Huerter appeals the negative judgment. Concluding that sufficient evidence supports the trial court's finding that Huerter received consideration under the contract, we affirm.

Facts and Procedural History

On October 23, 2004, Huerter and Sedric entered into a contract for the sale of real estate in Lake County, Indiana. Pursuant to the contract, Huerter agreed to sell the property to Sedric for $100,000, and that amount was to be paid within ten days of the execution of the contract. Ex. Vol., Plaintiff's Ex. 1. Huerter simultaneously transferred the property to Sedric via quit claim deed. The deed states that the property was transferred to S.J. Rehab, of which Sedric was a major shareholder and owner, for $10 and "other valuable consideration, the receipt and sufficiency of which is hereby acknowledged[.]" Ex. Vol., Plaintiffs Ex. 2. Sedric recorded the quit claim deed on November 10, 2004.

Shortly after entering into the contract, Sedric was diagnosed with cancer, and he died on November 5, 2005. Sedric's Estate was opened in Cook County, Illinois, under Case No. 2005P008724, and Gloria Moore was appointed executrix of the estate. An estate was not opened in Indiana. Tr. p. 6.

On July 24, 2006, Accredited Home Lenders Inc. filed a petition for foreclosure of mortgage relating to the property Sedric purchased from Huerter in Lake Superior Court. The petition sought a judgment against Gloria Moore in her capacity as the personal representative of Sedric's Estate.²

On February 8, 2007, Huerter filed a Petition to Intervene and Assert Claim and an "Answer to the Complaint, First Amended Complaint, and Second Amended Complaint on Note and to Foreclose Mortgage and Cross Claim." Appellant's App. p. 90. In that pleading, Huerter alleged that he asserts, maintains, and holds a legal and equitable interest in the real property in question, by way of land purchase and said realty between plaintiff and James Sedric a/k/a Sedric L. James, Deceased, which said interest must be determined and accounted in this proceeding.

Id. at 92. In his cross-claim, Huerter alleged that he "is entitled to have quiet title established in his name and against the Estate of James Sedric . . . for all ownership interest in the realty in question[.]" Id. On December 10, 2008, Huerter filed an additional count on his cross claim "to clarify and elaborate upon the relief that he seeks[.]" Id. at 96. Huerter alleged that Sedric had breached the contract because Huerter had not been compensated for the property at issue. Therefore, in the alternative to quieting title in his name, he requested a judgment from Sedric's Estate in the amount of $100,000. Id. at 99.

On December 3, 2009, a bench trial was held on Huerter's cross claim. At the start of trial, Sedric's Estate filed a Trial Rule 12(B)(1) motion to dismiss Huerter's cross claim for lack of subject matter jurisdiction. The Estate argued that the trial court lacked jurisdiction because Huerter's claim is a probate matter that must be raised in the Estate and not in a mortgage foreclosure action. Tr. p. 5. The trial court denied the motion to dismiss.

During the bench trial, Huerter testified that he "was looking for someone to help me to develop" the property at issue. Tr. p. 21. He was then introduced to Sedric "as a possible business partner for developing the property." Tr. p. 22. After claiming that he never received the $100,000 contract price from Sedric, Huerter was asked what steps he took to "encourage the receipt of the money." Tr. p. 29. Huerter responded, We were going to draw up a contract to develop the property between us. And that property -that $100,000 was my contribution to the development. So I was supposed to get shares out of whatever was put together for the development of the property and to participate in that development with [Sedric].

Tr. pp. 29-30; see also Tr. p. 49 (stating the $100,000 sale price "was either supposed to be paid within ten days" or "to be taken care of when we did the development[.]"). Huerter stated that he and Sedric intended to develop the property as soon as possible. Although he failed to produce any writing memorializing the alleged development agreement, Huerter testified that he and Sedric met with engineers and an attorney to draft a development agreement. Id. at 31. But shortly thereafter, Sedric's health began to decline. Id. In response to Huerter's arguments and testimony, Sedric's Estate argued that Sedric likely paid the $100,000 contract price within ten days of execution of the contract.

In his closing argument, Huerter asserted that the evidence established that the contract between the parties was void for lack of consideration, and requested that the trial court quiet title to the real estate at issue in his name. Specifically, he argued, "[s]o what we simply have here is a lack or failure of consideration, and so the contract is null and void and that's the whole purpose of this Quiet Title, . . . is to void that contract and put the title back into the name of Cy Huerter." Tr. p. 53; see also Tr. p. 56 (stating that Huerter "is entitled to have his property back").

On January 27, 2010, the trial court issued its findings of fact and conclusions of law and granted judgment in favor of Sedric's Estate. The trial court observed that Huerter "made no claim that Sedric failed to comply with the contract between October 23, 2004, and November 5, 2005." Appellant's App. p. 17. Further, the court found that "Huerter's testimony that he has not received the purchase money for the sale of the property is in direct conflict with the language of the Quit Claim Deed that he acknowledges that he signed voluntarily." Id. Ultimately, the court concluded that the parties had a valid contract and Huerter received adequate consideration. Id.

Shortly thereafter, Huerter filed a motion to correct error and argued that the trial court's finding that Huerter received consideration for the real estate at issue was not supported by the evidence. Huerter argued that the trial court was required to determine "how much purported consideration was purportedly paid by the estate to [Huerter] and failed to determine how much was owed to [Huerter] and failed to award [Huerter] the difference owed to him." Appellant's App. pp. 101-02. The trial court denied the motion to correct error. Huerter now appeals.

Discussion and Decision

Huerter claims that the trial court erred when it concluded that Huerter received adequate consideration for the sale of the property to Sedric. Specifically, he argues that there is no evidence that Sedric paid the $100,000 contract price for the Lake County real estate at issue.

At trial, both Huerter's action to quiet title and breach of contract claim were pending before the trial court. Appellant's App. pp. 92-93, 98-99. In his closing argument, Huerter's requested remedy was limited to asking the court to quiet title to the real estate at issue in his name. Huerter did not request a damage award. But in his motion to correct error and on appeal, Huerter's only requested remedy is monetary damages. Specifically, on appeal, Huerter argues that because Sedric was contractually required to pay $100,000 for the real property,

and where the uncontradicted and unchallenged evidence is that said One Hundred Thousand Dollars ($100,000.00) or any part thereof, were never paid, it should be determined that a breach of the contract occurred and that Huerter is due One Hundred Thousand Dollars ($100,000.00) from the estate.

Appellant's Br. at 11. See also Appellant's App. p. 101 (requesting monetary damages in the motion to correct error).

First, we observe that Huerter's breach of contract claim was not properly before the Lake Superior Court, and it is not properly before us on appeal. Under the facts before us, Huerter's allegation that Sedric breached the parties' contract should have been filed as a claim against Sedric's Estate. See Polly v. Estate of Polly, 896 N.E.2d 350, 352 (Ill. Ct. App. 2008). Sedric's Estate was probated in Cook County, Illinois.³ The definition of a "claim" under the Illinois Probate Code is broadly defined to include "'any cause of action.'" Id. (quoting 755 ILCS 5/1-2.05 (West. 2002)) (stating that a cause of action for breach of contract must be raised as a claim against the decedent's estate). If Sedric had opened an estate in Indiana, we...