Leistikow v. Hoosier State Bank

281 N.E.2d 893, 152 Ind. App. 112, 1972 Ind. App. LEXIS 963
CourtIndiana Court of Appeals
DecidedMay 9, 1972
DocketNo. 272A107
StatusPublished

This text of 281 N.E.2d 893 (Leistikow v. Hoosier State Bank) 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
Leistikow v. Hoosier State Bank, 281 N.E.2d 893, 152 Ind. App. 112, 1972 Ind. App. LEXIS 963 (Ind. Ct. App. 1972).

Opinion

Sharp, J.

This action was initiated by the Appellee, Hoosier State Bank of Indiana (hereinafter Bank) upon a complaint to reform a real estate contract and to have said contract declared forfeited and terminated. The Bank also sought to have possession of the premises, to have its title quieted and damages. Appellant, Henry E. Leistikow, filed a cross-complaint wherein he alleged that the Bank and the other individual appellees had violated the terms of an agreement to reconvey certain property and sought damages.

Extensive depositions were taken of all the individual parties and they are contained in a supplemental record of over 600 pages. Based on the information contained in the depositions, the Bank filed a Motion for Summary Judgment both as to its complaint and Appellant’s cross-complaint. Numerous affidavits, counter-affidavits, supplemental counter-affidavits and rebuttal affidavits were filed. Thereafter, on October 19, 1970, the trial court granted the Bank’s Motion for Summary Judgment and rendered judgment in favor of the Bank on its complaint and against Appellant on his cross-complaint. The question of the amount of damages was deferred to a later time.

Appellant filed his motion to correct errors, which was overruled. The two issues presented here for review are whether the trial court erred in granting summary judgment in favor of the Bank on its complaint and whether the trial [114]*114court erred in granting summary judgment in favor of the Bank and individual cross-defendants-appellees on Appellant’s complaint.

We are thus confronted with the question of whether there is a genuine issue as to a material fact so as to preclude the granting of summary judgment. In determining whether there is a genuine issue as to a material fact, this court must resolve all doubts against the party moving for summary judgment. Wozniczka v. McKean (1969), 144 Ind. App. 471, 247 N. E. 2d 215 and cases cited therein. By Wozniczka this court has adopted the Federal test to the effect that if there is “the slightest doubt” or “any doubt,” summary judgment should not be granted. The evidence must be “liberally construed in favor of the party opposing the motion and he is to be given the benefit of all favorable inferences which might reasonably be drawn from the evidence,” Wozniczka, supra, citing Barron & Holtzoff, Federal Practice and Procedure (Wright Ed.), Vol. 3 § 1235.

With these principles in mind we look to the evidence as shown by the depositions and affidavits. Early in 1959, Leistikow sold a retail hardware store and with the proceeds purchased a 75 acre tract of real estate near Crown Point, Indiana, for the purpose of development. Shortly thereafter Leistikow and his wife purchased under contract an additional 150 acres immediately south of the first tract.

After these acquisitions Leistikow surveyed out 3.75 acres from the first purchase and constructed a ranch house thereon. A $22,000.00 loan was obtained and was secured by a mortgage on the improved property. At approximately the same time Leistikow sold off two ten acre tracts from the 150 acres acquired under contract. When Leistikow had difficulties obtaining releases and deed from the vendors he found it necessary to procure a loan from the First National Bank of Crown Point in the sum of $55,000.00 to pay off the vendor under the sales contract. Leistikow and his wife signed a promissory note for that amount and executed a mortgage on all the real [115]*115estate then owed by them. The mortgaged property was divided into three tracts totaling 205 acres which consisted of 3.5 acres of improved real estate, 71.5 acres of unimproved real estate and 130 acres of unimproved real estate.

Sometime in 1964, Leistikow, together with a partner, decided to open a restaurant in Highland, Indiana. In regard to this venture, Leistikow received two $10,000 loans from the Bank, which were supposedly secured by second mortgages on the above described real estate, but which were carried on the Bank’s ledgers as unsecured loans. Also, in 1964, Appellant Leistikow, received a $20,000 loan in order to construct a second house. Part of said loan went to obtaining a release of the first mortgage. Upon retaining the release, Leistikow and his wife executed a first mortgage in favor of the Bank on the tract of land containing the second house and it is this tract that was the subject of Appellee’s complaint here.

The 201 acres of unimproved real estate will hereafter be considered in toto and be referred to as the farm property. The second house, upon which the Bank had a first mortgage, will hereinafter be referred to as the home.

In 1965, the restaurant ran into financial difficulties and Leistikow arranged to borrow sums of money and executed various mortgages in favor of the Bank.

On August 16, 1965, in order to secure additional financing, Henry E. Leistikow and his wife placed title to all their property in the name of the Bank under a land trust with the Bank as trustee. Simultaneously therewith, the Leistikow’s executed and delivered an assignment of the beneficial interest in said trust to the Bank to serve as security for an additional $25,000.00 loan and also as further collateral security for any indebtedness then owing to the Bank or that might be owing in the future.

Since the above transaction resulted in the Bank acquiring a junior lien or mortgage on the farm property in contravention of IC 1971, 28-1-13-7, Ind. Ann. Stat. § 18-1307 (Burns [116]*1161964), the beneficial interest in the farm was further assigned to Clarence Harney’s mother and sister. Clarence Harney was at that time an officer of the Bank and had dealt with the Leistikows on many occasions. The evidence is conflicting as to who actually furnished the money to the Leistikows under the note. It is further unclear whether Harney’s mother and sister actually paid off the Bank for the assignment. However, it is revealed that the Bank made a $11,500.00 loan to the mother for the purpose of purchasing the assignment from the Bank.

Finally, Henry Leistikow found a purchaser for the ranch house and needed to obtain a release of the first mortgagee, the First National Bank of Crown Point. In some way, the precise manner of which being factually in dispute, the Crown Point Bank received the proceeds of the sale of the ranch house plus $18,000.00, which represented the balance due under the note and mortgage. Thereafter, the note and mortgage were endorsed in blank and ultimately ended up being recorded on April 6, 1967, with the names of Gladys Harney Ross and Clarence H. Harney or the survivor thereof as assignees. The $18,000.00 used to pay the balance of the note and mortgage came from a loan from the Bank to Gladys Harney Ross. The purpose of the assignment was to place the first mortgage on the farm in hands friendly to the Bank, i.e., Harney, who was an officer thereof.

Henry E. Leistikow filed a voluntary petition in bankruptcy on January 31, 1967. Subsequent thereto, the Bank instituted foreclosure actions against the two properties, with Clarence Harney and Gladys Ross being made party defendants to the foreclosure of the farm. The Bank was the highest bidder on the home and Clarence Harney and Gladys Ross, the assignees of the first note and mortgage, were the highest bidders on the farm. Each received a sheriff’s deed to their respective properties. The Bank allowed the Leistikows to remain in possession of the home and finally entered into a written contract to reconvey the property back to the Leistikows.

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Related

Wozniczka v. McKEAN
247 N.E.2d 215 (Indiana Court of Appeals, 1969)

Cite This Page — Counsel Stack

Bluebook (online)
281 N.E.2d 893, 152 Ind. App. 112, 1972 Ind. App. LEXIS 963, Counsel Stack Legal Research, https://law.counselstack.com/opinion/leistikow-v-hoosier-state-bank-indctapp-1972.