INDIANA CASELAW UPDATE: Finality Of Judgment, Jurisdiction, And Reasonable Attorney Fees

INDIANA CASELAW UPDATE

FINALITY OF JUDGMENT, JURISDICTION, AND REASONABLE ATTORNEY FEES

Stephen E. Arthur

Finality of Judgment; Interlocutory Appeals

A trial court’s judgment as to one or more but fewer than all claims or parties is a final appealable judgment only when the court, in writing, expressly determines that there is no just reason for delay and directs entry of judgment. Allstate Insurance Co. v. Fields, 2006 WL 401197, 1 (Ind. 2006). Absent this express determination, or a party’s compliance with the requirements for taking an interlocutory appeal under Appellate Rule 14, an interlocutory order is not appealable.

Allstate initiated an interlocutory appeal after the trial court denied its Trial Rule 60(B) motion to set aside the trial court’s default order against Allstate on the issue of liability. The Court of Appeals found that it had jurisdiction to decide the case under Trial Rule 60(C) and Appellate Rule 66(B). The Supreme Court rejected this approach.

The Indiana Supreme Court stated “Indiana Trial Rule 60(B) does not apply to interlocutory orders, and a party may seek relief only from a final judgment or order that determines the entire controversy or decides the case on the merits.” A motion asking the trial court to reconsider an entry of default is not a request for relief under Trial Rule 60(B), but rather a request for an interlocutory ruling. Appellate Rule 14, and not Trial Rule 60(C)/Appellate Rule 66(B), governs a party’s right to appeal this type of interlocutory order. Because Allstate had failed to take the necessary steps under rule Appellate Rule 14, appellate courts could not accept the interlocutory appeal.

Subject Matter Jurisdiction v. Jurisdiction Over The Case

Under the Indiana Administrative Orders and Procedures Act (AOPA), time provisions of Indiana Code Section 4-21.5-5-13 are mandatory and conditions precedent to a court acquiring jurisdiction over a petition for judicial review. The issue of subject matter jurisdiction, in this context, was recently discussed in Indiana St. Bd. of Health Facility Administrators v. Werner, 841 N.E.2d 1196, 1204 (Ind. Ct. App. 2006).

Werner sought judicial review of a decision entered by the State Board of Health Facility Administrators (the Board) suspending Werner’s license and requiring her to pay costs. The trial court vacated the Board’s order, finding that it was arbitrary and unsupported by the evidence. The Board argued that because Werner had failed to plead her claim timely, the trial court never acquired subject matter jurisdiction. Conceding the timeliness issue, Werner argued the result was a lack of jurisdiction over the case, an issue that had been waived by the State’s failure to challenge jurisdiction at the trial court level.

The Court of Appeals noted that a great deal of confusion has resulted from the tendency of courts to reference “jurisdiction” without specifying whether they are addressing subject matter jurisdiction or jurisdiction over the case. The Court’s holding is consistent with Indiana law governing these two types of jurisdiction. Subject matter jurisdiction is the power of a court to hear a class of cases, while jurisdiction over the case is the power of the court to hear a particular case within the class of cases. Subject matter jurisdiction derives from legislative or constitutional authorization, and not the intricacies of a party’s pleadings or the correctness of a trial court’s decision. Subject matter jurisdiction may be asserted at any time, whereas jurisdiction over the case must be asserted timely before the trial court, or it is waived. In order to attack jurisdiction over the case timely, the defendant should assert the issue in its answer or by motion under Trial Rule 12(B)(6).

In affirming the trial court’s jurisdiction, the Court of Appeals noted that Indiana Code Section 4-21.5-5-2(a) provides that “judicial review is initiated by filing a petition for review in the appropriate court.” Id. AOPA defines “court” as “a circuit or superior court responsible for taking any action under this article.” The trial court, therefore, had subject matter jurisdiction over the case when Werner filed the claim in the Marion Superior Court. Werner’s failure to satisfy statutory prerequisites under AOPA went only to the court’s power to decide this particular case, not the court’s subject matter jurisdiction over AOPA type cases. The issue of jurisdiction was waived and could not be asserted for the first time on appeal.

Attorney Fees

A contract allowing for recovery of attorney’s fees is enforceable if the contract is not contrary to law or public policy. Franklin College v. Turner, 2006 WL 456343, 5 (Ind. Ct. App. 2006). The amount recoverable for an award of attorney’s fees is left to the sound discretion of the trial court. Id. In Franklin College, a student had defaulted on a loan granted to her by Franklin College (Franklin). Franklin brought suit, which was not defended, and filed a motion for summary judgment seeking to collect the principle balance, costs, and attorney fees. The trial court granted the motion, but reduced the Franklin attorney’s fee award

The Court of Appeals affirmed and, in so doing, examined the factors a court must consider in determining an award of attorney fees. First, a court is not required to award the fees that a client actually pays to his attorney. Instead, the court must determine what is a reasonable fee? Factors the court may consider include the attorney’s hourly rate, the result achieved, and the difficulty of the issues. The Court of Appeals noted that the attorney had incurred minimal time in obtaining judgment in a fairly routine collection case; therefore, a reduced award was appropriate.

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Stephen Arthur (sarthur@h-mlaw.com) is a partner with Harrison & Moberly, LLP, in Indianapolis, concentrating his practice in federal and state complex commercial litigation. Mr. Arthur is the author of the Civil Trial Practice and Indiana Procedural Forms volumes in West Publishing’s Indiana Practice series. The opinions and analysis expressed in this column are those of the author.