Guardianship: Members Source Credit Union v. Zachary Graykowski

• Court: Indiana Court of Appeals
• Decided: August 26, 2025
• Docket: 25A-GU-00526
• Status: Published

Opinion

IN THE

Court of Appeals of Indiana In the Matter of the Guardianship of Zachary Graykowski; Members Source Credit Union, FILED Appellant Aug 26 2025, 9:35 am

v. CLERK Indiana Supreme Court Court of Appeals and Tax Court Zachary Graykowski, Appellee

August 26, 2025 Court of Appeals Case No. 25A-GU-526 Appeal from the Lake Circuit Court The Honorable Jewell Harris, Jr., Probate Commissioner The Honorable Marissa McDermott, Judge Trial Court Cause No. 45C01-1007-GU-73

Opinion by Judge Tavitas Judges Vaidik and Felix concur.

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 1 of 12 Tavitas, Judge.

Case Summary [1] Members Source Credit Union (“Members Source”) appeals the trial court’s

order finding Members Source in contempt for violating a guardianship order.

Members Source argues that the trial court abused its discretion by finding that

Members Source willfully violated the order. We agree and, accordingly,

reverse.

Issue [2] Members Source raises one issue, which we restate as whether the trial court

abused its discretion by finding Members Source in contempt.

Facts [3] On July 2, 2010, Dawn Graykowski (“Mother”) filed a “verified petition for

appointment of guardian over the claim of a minor” related to a $166,037.11

injury settlement received by her then fourteen-year-old son, Zachary

Graykowski. Appellant’s App. Vol. II p. 11. Mother sought “a limited

guardianship over [Zachary] so that [Mother could] accept the proceeds of the

settlement on behalf of [Zachary] for [Zachary’s] benefit.” Id. at 12. On July 7,

2010, the trial court granted the petition and appointed Mother guardian “for

the limited purpose of collecting the claim of [Zachary][.]” Id. at 16. The trial

court ordered Mother to “provide proof to the court that upon receipt of the

claim a restricted guardianship account is opened . . . .” Id.

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 2 of 12 [4] Although the trial court’s order granted Mother only a limited guardianship, the

court issued letters of guardianship indicating that Mother’s guardianship was

“without limitations, per court order[.]” Id. at 17. Mother filed an oath and

accepted the guardianship on July 8, 2010. On August 3, 2010, Mother filed an

affidavit for proof of account and deposit of the injury settlement into a newly

opened account with Member Source.

[5] Years later, on February 12, 2024, Zachary moved for an accounting of the

funds deposited into the guardianship account. Zachary alleged that Mother

“continues to advise him that the time is not yet appropriate for the

disbursement of the funds to him, thereby causing him to suspect that [Mother]

has converted the funds held for his benefit to her own personal use” and that

Members Source “has advised him that it has no account relating to him now

opened in its branches.” Id. at 20. The trial court granted the motion on March

7, 2024, and ordered Mother and Members Source to provide an accounting of

the funds.

[6] Neither Mother nor Members Source filed an accounting of the funds, and on

June 28, 2024, the trial court scheduled a hearing for rule to show cause to be

held on June 30, 2024. Members Source subsequently produced the

accounting, which showed that, within thirteen months after the guardianship

account was opened, the account had been “drained.” Tr. Vol. II p. 25.

Mother testified at the hearing that she withdrew from the account using cash

withdrawals, cashier’s checks, and transfers to her own accounts at Members

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 3 of 12 Source. She used account funds to pay for vacations, furniture, and Zachary’s

medical bills.

[7] Michelle Rokosz testified on behalf of Members Source. Rokosz testified that

the guardianship account was opened on July 16, 2010, and closed on October

25, 2012. Members Source “would have had a copy” of the trial court’s order

appointing Mother guardian when opening the account. Id. at 13. Members

Source permitted Mother to draw from the account because, “[if] there is

nothing to state that no withdrawals are to be made until a certain age in the

paperwork then yes, if the parent is a guardian, then . . . . there is nothing to

stop them from withdrawing or transferring money because they’re the manager

of the account.” Id. at 11.

[8] Following the hearing, Zachary filed a petition for rule to show cause against

Mother and Members Source. Zachary requested that the trial court “find that

[Mother] and Member Source Credit Union willfully failed to comply with the

orders of the Court requiring the establishment of a restricted guardianship

account for a minor child [and] willfully permitted [Mother] to deplete the

guardianship account.” Appellant’s App. Vol. II p. 31. He requested that the

trial court award him attorney fees as a sanction.

[9] The trial court held a hearing on the petition on December 17, 2024, and

Mother did not appear. President James Falls testified on behalf of Members

Source. Falls claimed that the guardianship account was restricted because

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 4 of 12 “nobody could access the money but the guardian.” Tr. Vol. II p. 26. When

questioned by the court regarding the restrictions, Falls testified:

We follow the court orders. Now if the Court wants to define what a restricted account is and define it so we can know, then we’ll be happy to follow those rules. But according to what we have from our compliance department, we’ve created a restricted account.

Id. at 26. Members Source’s Executive Vice President also testified. Following

the testimony, Zachary asked that Mother and Members Source “be held in

contempt for breach of the restricted account provision of the Court’s order.”

Id. at 29.

[10] The trial court found Mother and Members Source in contempt for violating the

guardianship order. Following the hearing, the trial court issued written

findings in support of its contempt finding. The order provides:

4. Orders of the Court required that the funds be placed in a restricted account on behalf of [Zachary].

5. From testimony presented to the Court on July 30, 2024, a representative of Members Source Credit Union reported that instead of putting the funds in a restricted account, Members Source Credit Union did not put the funds in a restricted account but permitted [Mother] unfettered control over the funds of the guardianship account including the transfer [of] guardianship funds to her personal account, also with Members Source Credit Union.

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 5 of 12 6. The withdrawals from the guardianship account permitted by [Mother] and Members Source Credit Union were so extensive that by September 30, 2011, less than $44.00 of $166,037.11 remained in the account.

7. The testimony of Members Source Credit Union President and Executive Vice President is in direct contrast to the testimony presented to the Court on July 30, 2024, regarding the establishment of a restricted account for the guardianship funds of Zachary Graykowski.

8. [Mother] is entrusted with the care and financial well being of [Zachary].

9. [Mother] has misappropriated guardianship funds, failed to account for expenditures, and has acted in a manner that benefited herself at [Zachary’s] expense.

10. Members Source Credit Union, in allowing [Mother] to transfer funds from the guardianship account to her personal account and to make cash withdrawals without any inquiry or safeguards required by a restricted account for a minor, breached the orders of the Court requiring the financial organization holding guardianship funds to protect those guardianship funds.

11. The conduct of [Mother] and Members Source Credit Union in permitting the depletion of the court ordered restricted guardianship account for a minor within a period of less than 14 months from the July 20, 2010, establishment of the account has been willful and contumacious.

Pursuant to Indiana Code § 34-47-3-1, Members Source Credit Union and [Mother] are each held in contempt.

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 6 of 12 Appellant’s App. Vol. II pp. 9-10. The trial court ordered Mother and

Members Source to pay Zachary’s attorney fees as a sanction for the contempt

finding. 1 Members Source now appeals.

Discussion and Decision [11] Members Source argues that the trial court abused its discretion by finding

Members Source in contempt. “‘Trial courts maintain considerable discretion

in determining whether a party should be found in contempt of court, and these

determinations are reviewed for an abuse of discretion.’” In re N.E., 228 N.E.3d

457, 478 (Ind. Ct. App. 2024) (quoting In re Paternity of B.Y., 159 N.E.3d 575,

577 (Ind. 2020)). “Our court will reverse a finding of contempt only if there is

no evidence or inferences drawn therefrom that support it.” Id. (quotation

omitted).

[12] “Contempt of court generally involves disobedience of a court or court order

that undermines the court’s authority, justice, and dignity.” Id. (citing Reynolds

v. Reynolds, 64 N.E.3d 829, 832 (Ind. 2016)). There are two kinds of contempt:

direct contempt and indirect contempt. Id. (citing Reynolds, 64 N.E.3d at 832).

Only indirect contempt is at issue here, and it “involves those acts committed

outside the presence of the court which nevertheless tend to interrupt, obstruct,

embarrass or prevent the due administration of justice,” typically through the

1 The trial court limited its determination to the contempt finding; the trial court reserved ruling on whether Members Source and/or Mother breached their fiduciary duties and were liable for the depleted funds until a complaint alleging the same is filed.

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 7 of 12 disobedience, resistance, hindrance, or delay of a lawfully issued court

order. Id. (citing Reynolds, 64 N.E.3d at 832); Ind. Code § 34-47-3-1. 2

[13] It is well established that:

“[t]o be held in contempt for failing to comply with a court order, a party must have willfully disobeyed the order. The order must have been so clear and certain that there could be no question as to what the party must do, or not do, and so there could be no question regarding whether the order is violated. A party may not be held in contempt for failing to comply with an ambiguous or indefinite order . . . otherwise, a party could be held in contempt for obeying an ambiguous order in good faith.”[3]

Ferrill v. Ferrill, 143 N.E.3d 350, 357 (Ind. Ct. App. 2020) (quoting Bandini v.

Bandini, 935 N.E.2d 253, 264-65 (Ind. Ct. App. 2010) (internal quotation marks

omitted); accord City of Gary v. Major, 822 N.E.2d 165, 170-71 (Ind. 2005).

2 Indiana Code Section 34-47-3-1 provides: A person who is guilty of any willful disobedience of any process, or any order lawfully issued: (1) by any court of record, or by the proper officer of the court; (2) under the authority of law, or the direction of the court; and (3) after the process or order has been served upon the person; is guilty of an indirect contempt of the court that issued the process or order. 3 We note that Members Source was not made a party to this action. We have explained that “Indiana trial courts have inherent authority to enforce their orders through contempt powers, even against nonparties.” In re Paternity of N.T., 961 N.E.2d 1020, 1022 (Ind. Ct. App. 2012) (citing Owen v. Vaughn, 479 N.E.2d 83, 87-88 (Ind. Ct. App. 1985); La Grange v. State, 153 N.E.2d 593, 595 (Ind. 1958)). “‘One not a party who has knowledge of a court order but nevertheless aids, conspires with, and abets a party to an action in violating a court order entered therein, may be punished for contempt.’” Id. at 1023 (quoting Owen, 479 N.E.2d at 86). Here, neither party argues that Members Source’s status as a nonparty affects the contempt finding.

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 8 of 12 [14] In the present case, we conclude that the guardianship order was ambiguous

and the trial court erred by finding that Members Source willfully violated the

order. First, the guardianship order and the letters of guardianship conflict

regarding the scope of the guardianship. Indiana Code Section 29-3-7-3

provides:

(a) Letters of guardianship, temporary or otherwise, shall be issued to the person entitled to receive them[.]

*****

(c) If the court limits or restricts the authority of the guardian or creates a limited guardianship, the letters must so state under IC 29-3-8.

(Emphasis added).

[15] Indiana Code Section 29-3-8-8 similarly provides:

(a) The court, at the time of appointment or later, on its own motion or on petition of the protected person or other person approved by the court, may:

(3) limit the responsibilities and powers of the guardian otherwise conferred by this article and create a limited guardianship.

(b) However, all limitations must be endorsed on the guardian’s letters. Following the same procedure, a limitation

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 9 of 12 may be removed or modified and appropriate revised letters issued[.]

[16] Here, the guardianship order provides that the guardianship existed “for the

limited purpose of collecting the claim of [Zachary],” but the letters of

guardianship state that the guardianship was “without limitations, per court

order[.]” Appellant’s App. Vol. II pp. 16-17. The scope of the guardianship,

thus, was unclear. See City of Gary, 822 N.E.2d at 171 (analyzing whether order

forming basis for contempt finding contained “conflicting terms or provisions”).

[17] Second, the guardianship order required Mother to open a “restricted

guardianship account[.]” Appellant’s App. Vol. II p. 16. The order did not

specifically require or order Members Source to do anything. Moreover, the

order did not delineate the restrictions on the account Mother was to open.

Members Source employees testified that it opened a restricted account that

limited access to the guardian, Mother; the minor ward could not access the

account; and that this complied with Members Source’s policies. See Bowyer v.

Ind. Dept. of Nat. Res., 798 N.E.2d 912, 918-20 (Ind. Ct. App. 2003) (holding

that Bowyer could not be held in contempt for violating temporary restraining

order that prohibited performing “any and all excavation/construction

activities, of any nature whatsoever, below the shoreline of Lake Cicott” when

the order did not define and the Department of Natural Resources had not yet

established the lake’s shoreline; the order, thus, was “ambiguous”).

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 10 of 12 [18] We also note that, at the time the guardianship was created, Lake County

Probate Rule 67 provided:

Where an account with expenditures restricted by Court order has been created, an acknowledgement of or acquiescence to the restriction by the financial institution involved must be filed by the guardian’s Attorney within ten (10) days of the Court Order creating such an account. (SEE ATTACHED FORM)[.]

The referred-to attached Form E, which was not submitted to the trial court, provided:

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 11 of 12 [19] Here, the guardianship order did not delineate the restriction to which Members

Source was to “acknowledge[]” or “acquiesce[,]” and the record does not

demonstrate that Mother filed a Form E. The guardianship order only required

Mother to file “proof of complete deposit” of the claim, which Mother did.

Appellant’s App. p. 16.

[20] Given the lack of clarity in the guardianship order and the erroneous letters of

guardianship, we cannot say that Members Source willfully disobeyed the

court’s order; thus, it cannot be held in contempt of court.

Conclusion [21] The trial court abused its discretion by finding Members Source in contempt.

Accordingly, we reverse the judgment of the trial court.

[22] Reversed.

Vaidik, J., and Felix, J., concur.

ATTORNEYS FOR APPELLANT Kevin E. Steele Bryan E. Bott Burke Costanza & Carberry LLP Valparaiso, Indiana

ATTORNEY FOR APPELLEE John E. Hughes Hoeppner Wagner & Evans, LLP Valparaiso, Indiana

Court of Appeals of Indiana | Opinion 25A-GU-526 | August 26, 2025 Page 12 of 12