Lake Central School Corp. v. Hawk Development Corp.

793 N.E.2d 1080, 2003 Ind. App. LEXIS 1521, 2003 WL 21977072
Indiana Court of Appeals·Decided August 20, 2003·No. 45A03-0209-CV-310·Published·Cited by 10 cases

Opinions

OPINION

BAKER, Judge.

In this interlocutory appeal we have been asked to hold that Lake Central School Corporation was required to file a lis pendens notice in order to extinguish any rights in the condemned property held by a subsequent purchaser (Fetsch Town-homes) and encumbrancers (Bank Calumet and Fifth Third Bank). The Eminent Domain Act1 does not require the filing of a lis pendens, and, despite some dicta, no Indiana appellate opinion has held that a condemnor must file a lis pendens in order to cut off the property rights of subsequent purchasers and enecumbrancers. Although filing a lis pendens would relieve subsequent purchasers and encumbrancers of significant costs with little burden to a condemnor, such a decision should be left to the judgment of the General Assembly. Therefore, we reverse the trial court's grant of summary judgment in favor of the appellees and remand for entry of summary judgment in favor of Lake Central.

FACTS

Lake Central wanted real estate to build another elementary school in Lake County. In 1999 Lake Central offered to purchase a thirty-acre parcel from Hawk Development. The developer refused, prompting Lake Central's complaint for condemnation in October 1999. Hawk Development contested the condemnation action.

During the early part of 2000 while the condemnation action was still pending, Hawk Development sought to subdivide the property into what later became known as the Fox Chase Subdivision. The Lake County Plan Commission approved of Hawk Development's proposed subdivision despite Lake Central's objections at commission meetings. On October 5, 2000, Hawk Development obtained a $1,000,000 loan from Bank Calumet, which was secured by a mortgage on the subject property. Hawk Development did not inform Bank Calumet about Lake Central's pending condemnation action. At the time of the closing on the loan, Bank Calumet obtained a title commitment from Ticor Title Insurance Company demonstrating clear title in the subject property.

Thereafter, Hawk Development subdivided the property into forty-seven lots. [1083]*1083Fetsch Townhomes purchased six of the lots. The purchase by Fetsch Townhomes was financed through a loan from Fifth Third Bank, which loan was secured by a mortgage. At the time of the purchase, Fetsch Townhomes also obtained a title commitment from Chicago Title Insurance Company subsequently insuring clear title in Lots 1 through 6 of the thirty-acre parcel. Bank Calumet had since released its mortgage on those six lots.

Chicago Title and Ticor Title are owned by a single parent company known as Fidelity National Title Insurance. Both title companies prepared title insurance commitments during the relevant period by searching a "title plant" of information collected by a third party known as Security Union. Appellants' App. p. 141. Security Union updated the title plant by sending court runners, who would "go down to the clerk's office every day and search the new cases, the judgment docket and the lis pendens docket." Appellants' App. p. 258. Security Union's court runners did not locate Lake Central's condemnation complaint. It attributed the failure to "confusion" surrounding Lake County's transition to a new electronic system. Tr. p. 38.

During a period from November 2000 until June 2001 and after significant discovery, Hawk Development continued its objection to the condemnation action. On June 5, 2001, the trial court entered its Order of Appropriation and Appointment of Appraisers in favor of Lake Central On July 24, 2001, the appointed appraisers filed their report, which valued the subject property at $663,000. One week after the appraisers filed their report, Lake Central filed its Certificate of Payment of Assessed damages and tendered a check in' the amount of $663,000 to the Clerk of the Lake Superior Court. The trial court, in turn, entered an order of immediate possession. After meeting with Fetsch Town-homes, Lake Central secured the property.

Soon thereafter, Fetsch Townhomes, Bank Calumet, and Fifth Third Bank sought and were granted leave to intervene in Lake Central's condemnation action. At various times during the early months of 2002, Fetsch Townhomes, Bank Calumet, and Fifth Third Bank moved for summary judgment on the basis that the order of immediate possession could not operate to foreclose or condemn their respective rights in the property. Chicago Title and Ticor Title also intervened in the instant action and joined in the summary judgment motion filed by the other inter-venors. In addition, the two title companies submitted a separate joint motion for summary judgment. Lake Central, in response, filed a brief in opposition to the intervenors' summary judgment motion and filed its own cross-motion for summary judgment. Concluding that Lake Central was required to file a lis pendens notice in addition to its condemnation complaint and finding that the school corporation failed to file such notice, the trial court granted summary judgment in favor of the intervenors and against Lake Central. Lake Central now brings this interlocutory appeal.

DISCUSSION AND DECISION

I. Standard of Review

Summary judgment is proper if the evidence shows there is no genuine issue of material fact and the moving party is entitled to a judgment as a matter of law. Ind. Trial Rule 56(C); State Farm Fire & Cas. Co. v. T.B. ex rel. Bruce, 762 N.E.2d 1227, 1230 (Ind.2002). The courts construe all facts and reasonable inferences drawn from those facts in a light most favorable to the nonmoving party. T.B. ex rel. Bruce, 762 N.E.2d at 1230. On appeal from cross-motions for summary judg[1084]*1084ment, the reviewing court considers each motion separately to determine whether the moving party is entitled to judgment as a matter of law. Lake States Ins. Co. v. Tech Tools, Inc., 743 N.E.2d 314, 318 (Ind.Ct.App.2001). When the relevant facts are not in dispute and interpretation of a statute is at issue, such statutory interpretation "presents a pure question of law for which disposition by summary judgment is particularly appropriate." Koppin v. Strode, 761 N.E.2d 455, 460 (Ind.Ct.App.2002). Where the issue presented on appeal is a pure question of law, we review the matter de novo. Bader v. Johnson, 732 N.E.2d 1212, 1216 (Ind.2000).

IIL Eminent Domain Act and Constructive Notice

Fetsch Townhomes purchased a portion of the subject property from Hawk Development after Lake Central had filed its condemnation complaint. Likewise, Bank Calumet and Fifth Third Bank encumbered the property through mortgages after the filing of the condemnation complaint. Accordingly, we must decide whether the filing of the condemnation complaint alone was sufficient under Indiana statutory law to notify those parties of Lake Central's interest in the property. Indiana statutory law states that filing the condemnation complaint is sufficient to notify subsequent purchasers and encumbrancers of a condemnation action. In other words, a condemnor's filing of a lis pendens is not required by Indiana statutory law to put subsequent purchasers and encumbrancers on notice.

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Lake Central School Corp. v. Hawk Development Corp., 793 N.E.2d 1080, 2003 Ind. App. LEXIS 1521, 2003 WL 21977072 (Ind. Ct. App. 2003).

793 N.E.2d 1080 (Lake Central School Corp. v. Hawk Development Corp.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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Lake Central School Corp. v. Hawk Development Corp.
793 N.E.2d 1080 (Indiana Court of Appeals, 2003)