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Monday, February 06, 2006

Ind. Decisions - Court of Appeals decides five today; some commentary

Carl L. Banks v. State of Indiana - sentencing, affirmed.

In Charles Powell v. State of Indiana, Judge Sullivan writes:

Appellant, Charles Powell, brings this interlocutory appeal challenging the trial court’s denial of his motion to suppress. Upon appeal, Powell presents one issue for our review: whether an anonymous caller’s tip established the reasonable suspicion necessary to justify an investigatory stop under the Fourth Amendment of the United States Constitution. We reverse.
In Cash in a Flash, Inc. v. Glen Hoffman, the first of three treble-damages cases decided today, Judge Riley writes:
Appellant-Plaintiff, Cash in a Flash (CIF), appeals the trial court’s judgment finding that Ind. Code § 24-4.5-7-409(2) requires plaintiffs to prove common law fraud in order to seek treble damages and attorney’s fees under I.C. §§ 26-2-7 and 34-24-3. We affirm. * * *

I.C. § 24-4.5-7-409(2) clearly states that I.C. §§ 26-2-7 and 34-24-3 apply only when a check or an authorization to debit a borrower’s account is used to defraud another person. Although our legislature did not include the elements necessary to prove fraud, a definition, or a reference to the fraud statute, we can look to common law for guidance. To successfully sustain an action for common law fraud, a party must prove five essential elements: (1) a material misrepresentation, (2) of past or existing facts, (3) the falsity of the representation, (4) the representation was made with knowledge or reckless ignorance of its falsity, (5) and detrimental reliance on the representation. AutoXchange.com, Inc. v. Dreyer and Reinbold, Inc., 816 N.E.2d 40, 51 (Ind. Ct. App. 2004). Accordingly, we hold that I.C. § 24-4.5-7-409(2) requires a plaintiff to prove common law fraud in order to seek the damages and penalties available under I.C. §§ 26-2-7 and 34-24-3.[4] * * *
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[4]We must note that it would seem redundant to require a plaintiff to prove common law fraud in order to seek treble damages and attorney’s fees pursuant to I.C. § 34-24-3-1 if they have sustained the burden of proving fraud on a financial institution under I.C. § 35-43-5-8. Thus, as in this case, if a plaintiff proves fraud on a financial institution under I.C. § 35-43-5-8, the trial court has discretion to award treble damages and attorney’s fees pursuant to I.C. § 34-24-3-1 without requiring the plaintiff to prove the elements of common law fraud.

In Payday Today, Inc. v. Princess McCullough & Henry McCullough, Judge Riley writes:
Appellant-Plaintiff, Payday Today, Inc. (Payday), appeals the trial court’s denial of their claim for treble damages against Appellees-Defendants, Henry McCullough (Henry) and Princess McCullough (Princess), (collectively, the McCullough’s). * * *

Based on the foregoing, we find (1) that the trial court did not err in denying Payday’s claim for treble damages, and (2) the trial court erred in awarding Payday attorney’s fees and interest pursuant to I.C. § 26-2-7 et seq. Affirmed in part and reversed in part.

In Michael Neidow v. Cash in a Flash, Inc., Judge Riley writes:
Appellant-Defendant, Michael Neidow (Neidow), appeals the trial court’s judgment awarding Appellee-Plaintiff, Cash in a Flash, Inc. (CIF), treble damages and attorney’s fees pursuant to Ind. Code § 26-2-7 et seq. The DFI filed an Amicus Curiae Brief in support of Neidow. We reverse and remand.

Neidow raises one issue, which we restate as: Whether the trial court erred in awarding CIF treble damages and attorney’s fees pursuant to Ind. Code § 26-2-7 et seq. * * *

Based on the foregoing, we conclude that the trial court erred in awarding CIF treble damages and attorney’s fees. Additionally, the trial court’s judgment should be modified to reflect a judgment in favor of CIF and against Neidow for the following: $200.00 loan, $25.00 finance charge, returned check fee, and court costs. Reversed and remanded with instructions to modify the judgment accordingly.

Comments on the Court's opinion in Niedow. There is language on p. 9 of Neidow that I cannot let pass without some remarks. The language is:
Here, the record clearly reveals, and CIF admits in their brief, that they could not prove that Neidow intended to defraud them. CIF argues, however, that the list of remedies provided in I.C. § 24-4.5-7-409(2) is not exclusive. Therefore, CIF maintains that they can seek treble damages and attorney’s fees against Neidow for breach of contract as a result of his bad check under I.C. § 26-2-7 et seq. without first proving fraud. In support of their argument, CIF directs us to Burns Indiana Statutes Annotated version of I.C. § 24-4.5-7-409, where the title of the section reads “Applicability of other statutory provisions – Penalty for violations of chapter – Equitable relief – Remedies not exclusive.” However, the official version of I.C. § 24-4.5-7-409 on www.in.gov lists the title of section 409 as, “Restrictions, penalties, and enforcement.” Regardless of the title, the text of section 409 is the same and there is no language indicating that the remedies provided under the statute are non-exclusive to the lender.
My comments. Burns is, of course, a private publication and its section headings are written by a Burns' editor. I also believe they are copyrighted by the Burns' publisher. They certainly are not a part of the law adopted by the General Assembly.

And neither are the brief headings added to what the Court terms "the official version of" IC 24-4.5-7-409 on the General Assembly's website. As provided in IC 1-1-1-5(f):

(f) The headings of titles, articles, and chapters as they appear in the Indiana Code, as originally enacted or added by amendment, are not part of the law and may be altered by the lawful compilers, in any official publication, to more clearly indicate content. These descriptive headings are intended for organizational purposes only and are not intended to affect the meaning, application or construction of the statute they precede.
The makeup of the Ind. Code is Title > Article > Chapter > Section. Section headings are not mentioned in IC 1-1-1-5(f) because there are no section headings in bills passed by the General Assembly. Whenever you see section headings, in Burns or West or online, they have been added by an editor and have no official standing.

From the LSA Bill Drafting Manual, Chapter 3, G(2):

Section headings, which do become a part of the law, are not to be used in bills, even when a new section is being added to a chapter that has sections with existing headings. Furthermore, when an existing section that contains a heading is amended, the heading should be stricken, even in uniform laws.

Posted by Marcia Oddi on February 6, 2006 11:48 AM
Posted to Ind. App.Ct. Decisions