Gayle Fischer v. Michael and Noel Heymann

994 N.E.2d 1151, 2013 WL 2456110, 2013 Ind. App. LEXIS 274
CourtIndiana Court of Appeals
DecidedJune 7, 2013
Docket49A02-1204-PL-340
StatusPublished
Cited by1 cases

This text of 994 N.E.2d 1151 (Gayle Fischer v. Michael and Noel Heymann) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gayle Fischer v. Michael and Noel Heymann, 994 N.E.2d 1151, 2013 WL 2456110, 2013 Ind. App. LEXIS 274 (Ind. Ct. App. 2013).

Opinions

OPINION

NAJAM, Judge.

STATEMENT OF THE CASE1

Gayle Fischer brings this interlocutory appeal from the trial court’s judgment against Michael and Noel Heymann for $93,972.18 in damages on her breach-of-contract claim. Fischer requests that we vacate the trial court’s findings and conclusions on her failure to mitigate and remand with instructions to award actual and consequential damages in the amount of $286,409.43. On cross-appeal, the Hey-manns assert that the trial court’s specific findings required the court to enter a damage award of $117 for Fischer. We consolidate the parties’ arguments and consider the following two issues:

1. Whether the trial court’s findings that Fischer would not have been damaged had she agreed to make the repairs identified in the inspection report on or before February 18, 2006, means that Fischer failed in her duty to mitigate her damages; and
2. Whether the trial court abused its discretion when it limited Fischer’s award for attorney’s fees and court costs in accordance with her failure to mitigate her damages.

We hold that the Heymanns committed an anticipatory breach of the purchase agreement on February 10, 2006; that, given the evidence and the trial court’s findings, Fischer’s duty to mitigate arose on February 11, 2006, when she learned of the Heymanns’ breach; and that Fischer failed to act with reasonable diligence to mitigate her damages at her first opportunity, which was no later than February 18, 2006. We also hold that the trial court acted within its discretion when it limited Fischer’s award for attorney’s fees and costs. Based on the undisputed evidence and the trial court’s finding that Fischer would have incurred virtually no damages had she taken reasonable steps to mitigate on or before February 18, 2006, we reverse the trial court’s judgment on damages and remand with instructions that the trial court amend Fischer’s damage award to $117, reasonable attorney’s fees commensurate with that award, and court costs.

[1154]*1154FACTS AND PROCEDURAL HISTORY

On February 4, 2006, the Heymanns entered into a purchase agreement to purchase a condominium (the “Property”) at the One West Horizontal Property Regime (“One West”) in Indianapolis from Fischer for $315,000, with a closing date of May 31, 2006. The Heymanns agreed to pay cash for the Property. They paid $5,000 in earnest money and, pursuant to paragraph 13 of the agreement, they had the right to terminate the agreement if, upon inspection, the Heymanns

reasonably believe[d] that the Inspection Report reveal[ed] a MAJOR DEFECT with the Property and [Fischer wa]s unable or unwilling to remedy the defect. ... ‘Defect’ means a condition that would have a significant adverse effect on the value of the Property that would significantly impair the health or safety of future occupants ... or ... would significantly shorten or adversely affect the expected normal life of the premises.

Fischer v. Heymann, 943 N.E.2d 896, 898 (Ind.Ct.App.2011) (citation omitted), trans. denied (“Fischer I ”). On February 6, the Heymanns timely exercised their right to have the Property independently inspected for defects pursuant to paragraph 13.

The Heymanns hired an inspection company. The company inspected the Property and submitted its report to the Hey-manns. In relevant part, the inspection report noted as a “Major Concern[ ]” that “[tjhere is no electrical power to the outlets in the half bathroom and second floor bathroom and exterior outlet on the balcony.” Id. at 899 (quotations omitted). The inspection report further stated that the “light over the sink in the half bathroom did not light properly.” Defs. Trial Exh. X at 12.

On February 10, the Heymanns submitted to Fischer a “Buyer’s Inspection Response” (the “February 10 demand”) in which they agreed to accept the property if Fischer resolved the following: “Electrical power to the outlets in the half bathroom and second floor bedroom and exteri- or balcony. Light over half bath sink does not work properly (probably bulb replacement).” Id. (quotations omitted). The Heymanns reserved the right to inspect the property again prior to closing, but they demanded that Fischer respond by February 13. Fischer responded on February 13 with an Amendment to Purchase Agreement, on which she checked a box that read “[t]he time for making any responses to inspections is extended to” and wrote in “February 28, 2006.” Id. (quotations omitted). On February 15, the Hey-manns responded with their own Amendment to Purchase Agreement, in which they checked a box that read: “The time for making any responses to inspections is extended to February 18, 2006” (the “February 15 demand”). Appellant’s Addendum to Brief at 25.2 While paragraph 13 of the purchase agreement did not require that Fischer respond to the Heymanns’ conditions, paragraph 18 stated: “Time is of the essence. Time periods specified in this Agreement and any subsequent Addenda to the Purchase Agreement are calendar days and shall expire at midnight of the date stated unless the parties agree in writing to a different date and/or time.” Id. at 19.

[1155]*1155On February 17, the Heymanns prepared an offer on a different condominium unit at One West and executed a mutual release from their purchase agreement with Fischer. But the Heymanns instructed their agents not to deliver the offer or the release until February 19 and only in the event that Fischer did not respond to their demand for repairs by the February 18 deadline. See Fischer I, 943 N.E.2d at 899. As Mr. Heymann later testified, “had [there] been a response by [Fischer] by the 18th ... this piece of paper [the offer on the second condominium] ... would have gone in the wastebasket. It was always on the basis of if there continued to be no response.” Trial Transcript at 33.3

After Fischer did not respond to the Heymanns’ demand for repairs by February 18, on February 19 the Heymanns’ agents tendered the mutual release to Fischer, which she refused to sign. Fischer’s electrician later resolved the electrical problems by pushing the ground fault interrupter (“GFI”) reset button on the face of the wall outlets, and Fischer replaced a light bulb. Fischer’s total cost to fix the electrical problems was $117.

On May 9, Fischer sued the Heymanns for specific performance or, in the alternative, damages. The Heymanns answered and raised a third-party indemnity claim against their agents. The trial court found for the Heymanns and against Fischer after a bench trial, but, on appeal, we reversed. In particular, we concluded:

The substantive findings in the inspection report do not support an objectively reasonable belief that the defect was major. The report indicates there was no electrical power to three outlets, which could be and in fact was easily repaired. Therefore, under an objective standard, this would not have a significant adverse effect on the property’s value or significantly impair the health or safety of occupants.

Fischer I, 943 N.E.2d at 901.4

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Related

Gayle Fischer v. Michael and Noel Heymann
12 N.E.3d 867 (Indiana Supreme Court, 2014)

Cite This Page — Counsel Stack

Bluebook (online)
994 N.E.2d 1151, 2013 WL 2456110, 2013 Ind. App. LEXIS 274, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gayle-fischer-v-michael-and-noel-heymann-indctapp-2013.