FILED Mar 24 2023, 9:14 am
CLERK Indiana Supreme Court Court of Appeals and Tax Court
ATTORNEYS FOR APPELLANT ATTORNEYS FOR APPELLEE Ian D. Mitchell Thomas A. Brodnik Katherine M. Haire Paul L. Jefferson Reminger Co., L.P.A. Scott A. Milkey Indianapolis, Indiana McNeely Law, LLP Indianapolis, Indiana
IN THE COURT OF APPEALS OF INDIANA
Krieg DeVault LLP, March 24, 2023 Appellant-Defendant, Court of Appeals Case No. 22A-PL-1744 v. Interlocutory Appeal from the Marion Superior Court WGT V, LLC, The Honorable Heather A. Welch, Appellee-Plaintiff Judge Trial Court Cause No. 49D01-1906-PL-26376
Opinion by Judge May Judge Weissmann concurs. Judge Crone dissents with a separate opinion.
May, Judge.
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 1 of 22 [1] Krieg DeVault LLP (“Krieg”) appeals the trial court’s denial of the motion for
summary judgment that Krieg filed in the lawsuit WGT V LLC (“WGT V”)
brought against Krieg for legal malpractice and breach of fiduciary duty relating
to a commercial real estate transaction. On appeal, Krieg argues that the trial
court erred because:
(1) no attorney-client relationship existed between Krieg and WGT V;
(2) without an attorney-client relationship, Krieg could not have breached any fiduciary duty to WGT V; and
(3) the applicable two-year statute of limitations bars WGT V’s claims against Krieg for actions that occurred in 2003 or 2004.
Finding genuine issues of material fact exist in the record before us, we affirm
the trial court’s denial of Krieg’s motion and remand for further proceedings.
Facts and Procedural History [2] The relevant facts most favorable to WGT V, the non-moving party, are as
follows. In the 1960s, William Gerald Throgmartin (“Gerald”) became
involved in the operation of Gregg Appliances, Inc., which did business as
H.H. Gregg (“Gregg”), and he eventually became Gregg’s sole owner,
chairman, and CEO. Around 1990, Gregg began using Krieg’s legal services
for real estate transactions and the expansion of Gregg’s business. Gerald
explained that, after Krieg became Gregg’s lawyer, Gregg did not use any other Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 2 of 22 law firm during Gerald’s tenure with Gregg. Gerald indicated Krieg helped
with “every one” of Gregg’s property transactions – “They put the leases
together. They helped us buy it, close it. And they did every one of them.”
(App. Vol. IV at 63.) Paul Lindemann, a Krieg attorney, would either record
the deeds himself or have someone from his office do it, “always.” (Id.)
Gerald’s son, Jerry, became Gregg’s chairman and CEO in the early 2000s. In
2005, Gregg was sold to a private equity firm.
[3] Between the 1990s and 2005, Krieg also provided lawyers to meet the
Throgmartin family’s personal needs. (Id. at 67.) Krieg’s legal services assisted
with Gerald’s estate planning and formed several entities – e.g., Dadus III, Inc.;
Dadus V, Inc.; WGT, LLP – at Gerald’s request to benefit Gerald’s children –
Jerry Throgmartin, Janice Malone, Monica Adams, Kelli Ball, and Sandra
Smith. Krieg created prenuptial agreements and wills for various members of
the family and represented family members with “any legal work within
Indiana that we required.” (Id. at 87, 92, 97.)
[4] The bills for services by Krieg would come to the Gregg offices. Gerald would
know whether line items on the bills were for business or family matters based
on the initials of the lawyer who performed the work. (Id. at 67.) Assisting
Gerald with this process was Gregg’s controller, Diane Lutz, who averred she
was “point person for the Throgmartin Family regarding their financial
affairs[.]” (App. Vol. V at 214.) In this role, Lutz served as a “conduit”
between the Throgmartins and their lawyers. (Id.)
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 3 of 22 [5] In April 2003, Gregg purchased property in Georgia and was represented by
Krieg attorney Brian Fritts in the transaction. In July 2003, Krieg attorney Paul
Lindemann wrote a memorandum to Jerry outlining a plan for reorganizing
Dadus V, Inc., and its limited liability partner, WGT, LLP, into a single limited
liability company, WGT V, in which each of Gerald’s children would own a
20% interest. In September 2003, Krieg attorney Matthew Carr drafted
documents to accomplish that goal and filed WGT V’s articles of organization
with the Indiana Secretary of State’s office. WGT V’s operating agreement
stated that its primary purposes were to “(i) acquire and finance the acquisition
of real property either directly or indirectly, (ii) thereafter own, develop,
rehabilitate, renovate, improve, finance, refinance, lease, operate, manage and
sell or otherwise deal with real property, and (iii) engage in any lawful business,
whether or not related or incidental to the foregoing.” (App. Vol. IV at 141.)
Jerry, who at the time was Gregg’s chairman and CEO, was designated as
WGT V’s manager and registered agent.
[6] In October 2003, Gregg’s COO, Dennis May, spoke with Fritts regarding a
potential transaction in which Gregg would sell its Georgia property and a
property in Ohio to WGT V, which would then lease the properties back to
Gregg. At May’s request, Fritts prepared conveyance documents for the
transactions. In a November 2003 letter to May, Fritts stated that he had
drafted a lease agreement, a limited warranty deed, and other documents, but
that he needed additional information from May to finalize the documents for
closing. In October 2003, WGT V wired $3.5 million to Gregg to purchase the
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 4 of 22 Georgia property, and in November 2003, Gregg began paying $30,000 each
month to WGT V to lease the Georgia property.
[7] Fritts claims May never responded to his November 2003 letter or provided any
of the requested information to finalize the documents. However, in June 2004,
WGT V and Gregg executed a lease agreement for the Georgia property, and
an invoice from Krieg indicates someone at Krieg revised that lease the month
it was signed based on input from May and Jack Esselman, a commercial real
estate broker who did work for both Gregg and the Throgmartin family. 1 (App.
Vol. V at 81.) Jerry signed the lease on WGT V’s behalf, and May signed on
Gregg’s behalf. Pursuant to the agreement, Gregg continued paying WGT V
monthly rent of $30,000. There is no indication that any purchase agreement
was ever executed or that any deed was ever executed or recorded for the
transaction. 2
[8] In 2005, Gregg was sold to a private equity firm. Jerry passed away in 2012. In
2017, Gregg filed for Chapter 11 bankruptcy and rejected its lease with WGT V.
In January 2018, while negotiating a sale of the Georgia property, WGT V
learned that Gregg remained the record title holder of the Georgia property. In
July 2018, the property was sold for $2.8 million. Pursuant to a settlement
1 The invoice from Krieg was sent to Gregg corporate office “c/o Jerry Throgmartin[.]” (App. Vol. V at 81.) 2 In an affidavit, WGT’s current CFO David Mennel stated that he “could not locate a copy” of those documents in WGT’s files. (App. Vol. V at 5.)
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 5 of 22 agreement, Gregg’s bankruptcy creditors received $2.7 million, and WGT V
received $100,000.
[9] In June 2019, WGT V filed a complaint against Krieg, which was later
amended, alleging that Krieg engaged in negligent conduct, i.e., committed
legal malpractice, by “fail[ing] to obtain from Gregg the necessary executed
documents to effect the sale” of the Georgia property and failing to record a
deed “documenting the transfer of the” property. (App. Vol. II at 224.) WGT
V also alleged Krieg breached a fiduciary duty by failing to disclose to WGT V
that it was representing only Gregg in the Georgia transaction. In December
2021, Krieg filed a motion for summary judgment asserting that WGT V’s
claims were barred by the applicable two-year statute of limitations, that no
attorney-client relationship was ever formed between Krieg and WGT V, and
that Krieg did not breach a fiduciary duty. WGT V filed a response and
designated evidence from affidavits and transcribed depositions. Krieg filed a
reply. In April 2022, after determining genuine issues of material fact existed,
the trial court denied Krieg’s motion. Krieg requested the trial court certify its
decision for interlocutory appeal, which the trial court did, and we accepted
jurisdiction over the appeal.
Discussion and Decision [10] “The purpose of summary judgment under Indiana Trial Rule 56 is to terminate
litigation about which there can be no factual dispute and which may be
determined as a matter of law.” Ind. Farmers Mut. Ins. Co. v. N. Vernon Drop
Forge, Inc., 917 N.E.2d 1258, 1266 (Ind. Ct. App. 2009), trans. denied. “Even Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 6 of 22 though Indiana Trial Rule 56 is nearly identical to Federal Rule of Civil
Procedure 56, we have long recognized that ‘Indiana’s summary judgment
procedure . . . diverges from federal summary judgment practice.’” Hughley v.
State, 15 N.E.3d 1000, 1003 (Ind. 2014) (alteration in Hughley) (quoting Jarboe v.
Landmark Cmty. Newspapers of Ind., Inc., 644 N.E.2d 118, 123 (Ind. 1994)). “In
particular, while federal practice permits the moving party to merely show that
the party carrying the burden of proof lacks evidence on a necessary element,
we impose a more onerous burden: to affirmatively ‘negate an opponent’s
claim.’” Id. (quoting Jarboe, 644 N.E.2d at 123). “Indiana consciously errs on
the side of letting marginal cases proceed to trial on the merits, rather than risk
short-circuiting meritorious claims.” Id. at 1004.
[11] For the trial court to properly grant summary judgment, the moving party must
have made a prima facie showing that its designated evidence negated an
element of the non-moving party’s claim, and, in response, the non-moving
party must have failed to designate evidence to establish a genuine issue of
material fact. Cox v. Mayerstein-Burnell Co., 19 N.E.3d 799, 804 (Ind. Ct. App.
2014). “Only after the moving party carries its burden is the non-moving party .
. . required to present evidence establishing the existence of a genuine issue of
material fact.” Morris v. Crain, 71 N.E.3d 871, 879 (Ind. Ct. App. 2017). The
non-moving party may not rest on its pleadings, “but must set forth specific
facts which show the existence of a genuine issue for trial.” Perkins v. Fillio, 119
N.E.3d 1106, 1110 (Ind. Ct. App. 2019). “Mere speculation is insufficient to
create a genuine issue of material fact to defeat summary judgment.” Schon v.
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 7 of 22 Frantz, 156 N.E.3d 692, 698 (Ind. Ct. App. 2020) (quoting Biedron v. Anonymous
Physician 1, 106 N.E.3d 1079, 1089 (Ind. Ct. App. 2018), trans. denied). “In
deciding whether summary judgment is proper, we consider only the evidence
the parties specifically designated to the trial court.” Bertucci v. Bertucci, 177
N.E.3d 1211, 1221 (Ind. Ct. App. 2021) (citing Ind. Trial Rule 56(C), (H)).
[12] We review a trial court’s summary judgment ruling de novo. Mann v. Arnos,
186 N.E.3d 105, 114 (Ind. Ct. App. 2022), trans. denied. We neither reweigh
evidence nor judge witness credibility, but we accept as true those facts
established by the designated evidence favoring the non-moving party. Id. at
115. Any doubts as to any facts or inferences to be drawn therefrom must be
resolved in the non-moving party’s favor. Id. “[W]e are not bound by the trial
court’s findings of fact and conclusions thereon, but they aid our review by
providing the reasons for the trial court’s decision.” Id. “The party that lost in
the trial court bears the burden of persuading us that the trial court erred.” Id.
[13] “In a negligence action, a plaintiff must show a duty owed by the defendant to
the plaintiff, a breach of that duty, and damages to the plaintiff proximately
caused by the breach.” Hacker v. Holland, 570 N.E.2d 951, 955 (Ind. Ct. App.
1991), trans. denied. “In the context of an action for attorney malpractice, this
requires a plaintiff to show employment of the attorney (the duty), the
attorney’s failure to exercise ordinary skill and knowledge (the breach), and
damages to the plaintiff proximately resulting from that failure.” Id.
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 8 of 22 1. Attorney-Client Relationship
[14] An attorney-client relationship “need not be express; it may be implied from the
conduct of the parties.” Id. “Creation of an attorney-client relationship is not
dependent upon the formal signing of an employment agreement or upon the
payment of attorney fees.” Matter of Anonymous, 655 N.E.2d 67, 70 (Ind. 1995).
“Attorney-client relationships have been implied where a person seeks advice or
assistance from an attorney, where the advice sought pertains to matters within
the attorney’s professional competence, and where the attorney gives the
desired advice or assistance.” Id. “The relationship is consensual, existing only
after both attorney and client have consented to its formation.” Hacker, 570
N.E.2d at 955. “A would-be client’s unilateral belief cannot create an attorney-
client relationship.” Id.
[15] In his deposition, Gerald testified that the lawyer for WGT V was Krieg
attorney Paul Lindemann and that Krieg had represented Gregg, every other
entity Gerald created, and every person in his family. Three of Gerald’s
daughters submitted affidavits regarding their relationships with Krieg between
the early 1990s and the present. Sandra’s affidavit provided in relevant part:
2. At all times since its organization in 2003, I have been a member of WGT V, LLC (“WGT V”).
3. I had also previously been a partner of WGT V Limited Partnership as well as a shareholder of Dadus V, Inc since the time those entities were created in the early 1990s.
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 9 of 22 4. WGT V was originally formed in 2003 for multiple purposes, among which were estate and succession planning for my father W. Gerald Throgmartin, as well as for acquiring commercial real estate which it would subsequently lease to tenants, including Gregg Appliances, Inc. (“Gregg”).
5. From the time that WGT V was originally formed in 2003, Krieg DeVault, LLP (“Krieg DeVault”) provided WGT V with legal representation on a wide variety of corporate issues, including its original creation as an Indiana limited liability company, and issues relating to the acquisition and leasing of real estate to Gregg.
6. Specifically, in 2003, I, along with my siblings . . . met with one or more Krieg DeVault attorneys, on one or more occasions, who discussed the purposes for creating WGT V. At that time, Krieg DeVault offered to answer any questions that we may have about WGT V, and never indicated that it was not providing representation to WGT V.
7. Prior to 2003, Krieg DeVault held similar meetings with my siblings and I with respect to both WGT Limited Partnership and Dadus V, Inc.
8. I am not a sophisticated real estate investor, and therefore relied upon Krieg DeVault, both in my personal capacity as well as my capacity as a member of WGT V, for all real estate legal advice, including any and all legal requirements, to ensure that all legal requirements were met, and that all legal documents were completed, filed, and effective.
9. Prior to the filing of the above captioned lawsuit, I was never told by Krieg DeVault that it did not consider WGT V, WGT Limited Partnership, or Dadus V, Inc. to be clients of Krieg DeVault.
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 10 of 22 10. Beyond the legal work Krieg DeVault performed for WGT V, it also provided all legal services which I required between 1990 and 2004.
11. Those legal services included, but are not necessarily limited to, providing me with counsel for legal work related to my partnership interest in WGT Limited Partnership and my shareholder interest in Dadus V, Inc.
12. I have also relied upon Krieg DeVault for legal services on multiple occasions since 2004 including, but not necessarily limited to, the preparation of a pre-nuptial agreement in 2005, trust & estate legal services which I requested and received in 2006, and representation in a civil tort matter in 2012.
13. At all times relevant to the above captioned matter, I have considered Krieg DeVault to be not only the attorney for WGT V, but also the “family attorney” for my family with respect to any legal work within Indiana that we required.
(App. Vol. IV at 85-87.) Affidavits from Kelli and Monica differed only as to
paragraphs 11 & 12. Kelli’s affidavit provided:
11. Those legal services included, but are not necessarily limited to, providing me with counsel for legal work related to my partnership interest in WGT Limited Partnership and my shareholder interest in Dadus V, Inc. Additionally, in or about 1993, Krieg DeVault represented me in the preparation of a certain First Amendment to Buy-Sell Agreement that was executed by and between myself, my brother Jerry Throgmartin, my father W. Gerald Throgmartin, and Gregg Appliances, Inc. Finally, Krieg DeVault represented me in the preparation of estate work and a pre-nuptial agreement, both of which were performed prior to 2004.
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 11 of 22 12. I have also relied upon Krieg DeVault for legal services on multiple occasions since 2004 including, but not necessarily limited to, trust & estate legal services which I requested and received in or around 2007, corporate formation services in or around 2007, and estate & succession planning services in 2014.
(Id. at 91-92.) Monica’s affidavit provided:
11. Those legal services included, but were not necessarily limited to, providing me with counsel for legal work related to my partnership interest in WGT Limited Partnership and my shareholder interest in Dadus V, Inc.
12. I have also relied upon Krieg DeVault for legal services on multiple occasions since 2004 including, but not necessarily limited to, trust & estate legal services which I requested and received in 2007 and 2012.
(Id. at 96.)
[16] Paul Lindemann testified Krieg formed WGT V in 2003 and he would have
represented WGT V for “several years after that, I would guess.” (Id. at 109.)
Lindemann acknowledged representing WGT V on other real estate
transactions in Ohio and Illinois in 2004 and 2005. As to the Georgia
transaction at issue, Lindemann testified he was not involved, but he also
testified he does not “remember back that far.” (Id.) In preparation for his
deposition, Lindemann reviewed the “entire file for WGT[,]” which he
described as a “large” file. (Id. at 106.) During his deposition, the following
was revealed:
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 12 of 22 Q. . . . But when you were in charge of forming entities, how did you generally navigate that? Specifically, I guess, my question is, is would you represent the entity or one of the individual owners in the formation, as a general practice?
A. In the formation of it?
Q. Yeah.
A. I mean, generally speaking, you’re forming an entity because somebody told you they needed one. Right? So, you know, the question is, does that – does that new entity automatically become the client at that point and how do you navigate any potential conflicts of interest with – with the people who told you to form it. Right?
Q. Yeah. That’s what I’m trying to understand.
A. Yeah. In the Throgmartin’s case, as a general proposition, I’m not sure we thought too much about that, because WGT was an – in my mind, anyway, just an extension of WGT, Limited Partnership. It was the same entity, in a new form. So I’m not sure that we would have necessarily done an engagement letter for a new client, at that point.
(Id. at 112.)
[17] WGT V also designated an affidavit from Diane Lutz, who averred:
7. In this role serving as the point person for the Throgmartin Family regarding their financial affairs, I exchanged communications on multiple occasions with Matthew Carr and Paul Lindemann, both attorneys at Krieg DeVault, regarding work that Krieg DeVault was performing on behalf of WGT V,
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 13 of 22 LLC, WGT Limited Partnership, and Dadus V, Inc., all of which were owned by the Throgmartin Family.
8. To the extent either Matthew Carr and/or Paul Lindemann sent correspondence to my attention regarding WGT V, LLC, WGT Limited Partnership, and Dadus V, Inc., it was not in my role as Gregg’s controller, but was instead in my role as the point person for the Throgmartin Family’s affairs. Krieg DeVault, including Paul Lindemann, was aware of my role as the point person for the Throgmartin Family.
9. In my capacity of assisting Gerald Throgmartin, Jerry Throgmartin, and other members of the Throgmartin Family with their financial affairs, I cannot recall any attorneys from Krieg DeVault ever asking me to tell one or more members of the Throgmartin Family that they should obtain their own separate legal counsel due to the fact that Krieg DeVault was only representing Gregg in a real estate transaction that also involved the Throgmartin Family.
(App. Vol. V at 213-14.)
[18] In sum, the facts most favorable to WGT V reveal that, in 2003 and 2004,
WGT V and Gregg were both owned by the Throgmartin family, led by Jerry
Throgmartin, and represented by Krieg. While there are genuine issues of
material fact about whether Krieg represented WGT V for the Georgia property
transaction in particular, the evidence reveals Krieg represented WGT V, its
predecessor entities, and individual members of the Throgmartin family during
this same timeframe. In fact, during the same year that the botched Georgia
transaction was to have occurred, Krieg assisted the Throgmartin family with
the transfer of real property from WGT LLP into WGT V and assisted WGT V
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 14 of 22 with the acquisition of another Gregg property in Ohio. Moreover, in June
2004, Krieg revised the lease agreement for the Georgia property based on input
from Gregg’s May and from Esselman, a real estate broker who sometimes
assisted Gregg and sometimes assisted the Throgmartin family, and Krieg sent
the invoice for those revisions to Jerry Throgmartin, who was both Chairman of
Gregg and manager of WGT V. 3 Thus, the designated evidence creates a
genuine issue of material fact about whether Krieg was the lawyer for both
Gregg and WGT V during the ultimately unconsummated Georgia transaction.
2. Fiduciary Duty
[19] “‘A claim for breach of fiduciary duty requires proof of three elements: (1) the
existence of a fiduciary relationship; (2) a breach of the duty owed by the
fiduciary to the beneficiary; and (3) harm to the beneficiary.’” West v. J. Greg
Allen Builder, Inc., 92 N.E.3d 634, 643 (Ind. Ct. App. 2017) (quoting Farmers
Elevator Co. of Oakville v. Hamilton, 926 N.E.2d 68, 79 (Ind. Ct. App. 2010), trans.
denied), trans. denied. In its amended complaint, WGT V asserted:
90. Krieg DeVault, in its role as WGT’s counsel, or based upon WGT’s status as a third party beneficiary of the Legal Services Contract, owed WGT a fiduciary duty to act in good faith and in WGT’s best interest during the course of the attorney-client relationship.
3 The record does not disclose why the failed transfer of the property was not uncovered during this process.
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 15 of 22 91. Krieg DeVault, in its fiduciary capacity, was required to make truthful and complete disclosures to WGT.
92. Krieg DeVault failed to provide WGT with truthful and complete disclosures to WGT including (among other things) that Krieg DeVault was representing only Gregg and not both Gregg and WGT with respect to the commercial real estate transaction involving the [Georgia] Property, and/or that Krieg DeVault was not acting in WGT’s interests as a third-party beneficiary.
(App. Vol. II at 226.)
[20] On appeal, Krieg asserts the trial court erred by not granting summary
judgment on WGT V’s fiduciary-duty claim because Krieg “never owed any
such duty.” (Appellant’s Br. at 32.) In support, Krieg asserts: “While the
relationship between an attorney and client is of a confidential and fiduciary
nature, there can be no breach of a fiduciary duty here because, as discussed
above, the threshold requirement of an attorney-client relationship between
Krieg DeVault and WGT is absent[.]” (Id.) Because there are genuine issues of
material fact about whether Krieg was WGT’s lawyer, genuine issues of
material fact also exist about whether Krieg had a fiduciary duty to WGT that it
could have breached. Because Krieg did not demonstrate summary judgment
was appropriate on the underlying claim, it could not be entitled on that ground
to summary judgment on the claim that derived therefrom. Cf. Miller v. Central
Indiana Cmty. Foundation, Inc., 11 N.E.3d 944, (Ind. Ct. App. 2014) (where
summary judgment was appropriate on all of husband’s underlying tort claims,
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 16 of 22 summary judgment was also appropriate on wife’s loss of consortium claim, as
it was derivative of from husband’s tort claims), reh’g denied.
3. Statute of Limitations
[21] “Statutes of limitations are legislative judgments and serve important
purposes.” Miller v. Patel, 174 N.E.3d 1061, 1066-67 (Ind. 2021). By
encouraging prompt presentation of claims, statutes of limitation “spare the
courts from litigation of stale claims, and the citizen from being put to his
defense after memories have faded, witnesses have died or disappeared, and
evidence has been lost.” Perryman v. Motorist Mut. Ins. Co., 846 N.E.2d 683, 689
(Ind. Ct. App. 2006)
Statute of limitations defenses are particularly appropriate for summary judgment determination. The party asserting it must make a prima facie showing that the action was commenced outside the statutory period by identifying (1) the nature of the plaintiff’s action, so that the relevant statute of limitations period may be identified; (2) the date the plaintiff’s cause of action accrued; and (3) the date the cause of action was brought, being beyond the relevant statutory period. If the moving party demonstrates these matters properly, the burden shifts to the opponent to establish facts in avoidance of the statute of limitations defense.
City of Marion v. London Witte Group, LLC, 169 N.E.3d 382, 390 (Ind. 2021)
(internal citations and quotation marks omitted).
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 17 of 22 [22] The parties agree the two-year statute of limitations provided by Indiana Code
section 34-11-2-4 4 is applicable to WGT V’s claims of attorney malpractice and
breach of fiduciary duty. (See Appellant’s Br. at 19 & Appellee’s Br. at 32.) And
see Estate of Spry v. Batey, 804 N.E.2d 250, 253 (Ind. Ct. App. 2004) (“The
statute of limitations for a claim of legal malpractice is two years.”), reh’g denied,
trans. denied. Krieg notes the Georgia transaction occurred in 2003 or 2004, but
WGT V’s claim was not filed until 2019, which was well past the two-year
statute of limitations. In response, WGT V argues the limitations period did
not expire before its claim was filed because of the discovery rule.
[23] Legal malpractice claims “are subject to the ‘discovery rule[.]’” Dickes v. Felger,
981 N.E.2d 559, (Ind. Ct. App. 2012). “Under the discovery rule, the statute of
limitations does not begin to run until the plaintiff knows, or in the exercise of
ordinary diligence could have discovered, that it has been injured from tortious
conduct.” City of Marion, 169 N.E.3d at 390. “For a cause of action to accrue,
it is not necessary that the full extent of damage be known or even
ascertainable, but only that some ascertainable damage has occurred.” Estate of
Spry, 804 N.E.2d at 253. The diligence expected is “simply that an injured
party must act with some promptness where the acts and circumstances of an
injury would put a person of common knowledge and experience on notice that
some right of his has been invaded or that some claim against another party
4 This code section provides, in pertinent part: “An action for: (1) injury to person or character; (2) injury to personal property; or (3) a forfeiture of penalty given by statute; must be commenced within two (2) years after the cause of action accrues.” Ind. Code § 34-11-2-4(a).
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 18 of 22 might exist.” Perryman v. Motorist Mut. Ins. Co., 846 N.E.2d 683, 689 (Ind. Ct.
App. 2006) (quoting Mitchell v. Holler, 429 S.E.2d 793, 795 (1993)).
[24] Here, the facts most favorable to WGT V indicate that, in the fall of 2003,
WGT V paid Gregg $3.5 million for the Georgia property and Gregg thereafter
remitted $30,000 per month in rent to WGT V. Gregg did not refuse to
continue paying on the lease until 2017, and, even then, it was because Gregg
was in dire financial circumstances, not because Gregg still owned the property
it was paying to lease from WGT V. WGT V learned that Gregg was the title
holder of record on the Georgia property in 2018, when WGT V was
negotiating the sale of the Georgia property with a third party. While Krieg
cites facts that it insists should have put WGT on notice that the deed had not
been transferred, nearly all of those facts involved Gregg’s COO May, who was
not a member of WGT V. Where, as here, there is no definitive proof that
WGT V had knowledge of the failed property transfer prior to 2017,
“application of the discovery rule necessarily involves questions of fact.” Lyons
v. Richmond Cmty. Sch. Corp., 19 N.E.3d 254, 262 (Ind. 2014). The trial court
properly denied summary judgment on Krieg’s summary judgment based on
the statute of limitations because genuine issues of material fact exist about
“when the plaintiff knew or, in the exercise of ordinary diligence, could have
discovered that an injury had been sustained[.]” Wehling v. Citizens Nat. Bank,
586 N.E.2d 840, 843 (Ind. 1992) (holding genuine issues of material fact
precluded summary judgment on statute of limitations defense where presumed
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 19 of 22 landowners claimed they did not know of Bank’s negligence until they
attempted to sell property and found it already belonged to someone else).
Conclusion [25] For all these reasons, we affirm the trial court denial of Krieg’s motion for
summary judgment and remand for further proceedings.
[26] Affirmed and remanded.
Weissmann, J., concurs.
Crone, J., dissents with a separate opinion.
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 20 of 22 Crone, Judge, dissenting.
[27] I respectfully dissent. The designated evidence indicates that WGT V did not
ask Krieg to draft or record a deed for the Georgia property and did not ask
Krieg to conduct a closing. Thus, the designated evidence establishes as a
matter of law that any damages suffered by WGT V as a result of the botched
Georgia transaction were not proximately caused by Krieg. In sum, Krieg
cannot be liable for not doing something that its alleged client did not ask it to
do. An attorney-client relationship exists for specific functions and only those
requested by the client.
[28] The designated evidence also establishes as a matter of law that WGT V, in the
exercise of ordinary diligence, could have discovered that it was damaged by
the Georgia transaction back in 2003 at the latest, and thus its claims are barred
by the two-year statute of limitations. See Biomet, Inc. v. Barnes & Thornburg, 791
N.E.2d 760, 765 (Ind. Ct. App. 2003) (emphasis added) (noting that “legal
malpractice actions are subject to the ‘discovery rule,’ which provides that the
statute of limitations does not begin to run until such time as the plaintiff
knows, or in the exercise of ordinary diligence could have discovered, that he had
sustained an injury as the result of the tortious act of another”), trans. denied.
WGT V was a sophisticated entity, and it simply defies credulity that a
competent corporate officer of such an entity would pay $3.5 million for a
property without executing a purchase agreement or receiving a deed.
Consequently, I would reverse and remand with instructions to enter summary
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 21 of 22 judgment for Krieg on WGT V’s claims for legal malpractice and breach of
fiduciary duty.
Court of Appeals of Indiana | Opinion 22A-PL-1744 | March 24, 2023 Page 22 of 22