Opinion
23A-PL-2868
11-22-2024
Patrick Murray and Gwen Barr, Appellants-Petitioners v. Duneland Beach Homeowners' Association, Inc., Mary Ann Fumo, and Michael Guenin, Appellees-Respondents
ATTORNEY FOR APPELLANT Adam M. Sworden Sworden Law, P.C. Valparaiso, Indiana ATTORNEY FOR APPELLEE Matthew J. Hagenow Newby, Lewis, Kaminski &Jones, LLP La Porte, Indiana
Pursuant to Ind. Appellate Rule 65(D), this Memorandum Decision is not binding precedent for any court and may be cited only for persuasive value or to establish res judicata, collateral estoppel, or law of the case.
Appeal from the LaPorte Superior Court The Honorable Richard R. Stalbrink, Jr., Judge Trial Court Cause No. 46D02-1808-PL-1323
ATTORNEY FOR APPELLANT Adam M. Sworden Sworden Law, P.C. Valparaiso, Indiana
ATTORNEY FOR APPELLEE Matthew J. Hagenow Newby, Lewis, Kaminski &Jones, LLP La Porte, Indiana
MEMORANDUM DECISION
Weissmann, Judge.
[¶1] Patrick Murray and Gwen Barr (Plaintiffs) are ousted directors of the Duneland Beach Homeowners' Association, Inc. (HOA). During their tenure, the HOA declined to provide certain information Plaintiffs requested. Plaintiffs then sued the HOA and two of its Directors (collectively, the HOA). When the HOA membership later removed Plaintiffs from its Board of Directors, Plaintiffs amended their complaint to also challenge their removal.
[¶2] Plaintiffs ultimately received most of the information they requested, and the trial court ruled they were not entitled to the rest. Finding Plaintiffs' other claims moot, the trial court granted summary judgment to the HOA and denied Plaintiffs' motion for partial summary judgment. Plaintiffs challenge both rulings in this appeal. We affirm.
Facts
[¶3] Plaintiffs' dispute with the HOA began in 2018, while Plaintiffs were serving on the Board. The Board established a Special Committee on Governance (Special Committee) to deal with "any board governance and director removal matters." Appellants' App. Vol. III, p. 43. The Special Committee met only one time-on July 7, 2018-and no longer exists. Shortly after the Special Committee's creation, Plaintiff Murray requested various documents from the HOA including the minutes from the past 10 years of Board meetings and a list of the HOA members' email addresses.
The two HOA Directors who are named defendants in this action-Michael Guenin and Maryanne Fumo-served on the Special Committee and also served as successive HOA presidents during this dispute.
[¶4] Murray made a series of additional requests for HOA records and information. When those requests were not answered fully, Murray, now joined by fellow HOA Director Barr, filed formal grievances with the HOA and the Board. And when those grievances were not resolved through negotiation, Plaintiffs filed suit against the HOA.
[¶5] Soon after, the HOA members voted by a 77.5% margin to remove Plaintiffs from the Board. Plaintiffs responded by amending their complaint to challenge their removal. Ultimately, Plaintiffs sought injunctive relief: (1) requiring the HOA to disclose the requested documents; (2) requiring the HOA to cease engaging in "any governance or conduct through the body presently denominated as 'Special Committee on Governance', or any similar body"; (3) nullifying all actions by the "Special Committee on Governance" or "any similar body"; (4) ensuring all of the Board members received the same communications; and (5) nullifying Plaintiffs' removal from the Board. Plaintiffs also sought compensatory damages and costs, including attorney fees.
[¶6] Plaintiffs later asked the trial court to compel the HOA to provide through discovery all the requested documents still outstanding. The HOA provided some documents to Plaintiffs, and after a discovery conference, the parties agreed that for purposes of the motion to compel, Plaintiffs' requests for the following documents and information were all that remained in dispute: (1) HOA members' email addresses; (2) communications (including unredacted legal bills) between the Special Committee and its law firm; and (3) an attorney opinion by the HOA's counsel (collectively, Disputed Documents).
[¶7] After several hearings, the trial court denied Plaintiffs' motion to compel. In its written order, the court ruled that the HOA had provided Plaintiffs with all the documents and information to which they were entitled six months earlier and, thus, Plaintiffs were not entitled to the Disputed Documents. The court therefore denied Plaintiffs' request for sanctions and attorney fees.
[¶8] Plaintiffs moved the trial court to reconsider its rulings, but the court never explicitly ruled on the motion. After a month, Plaintiffs moved for partial summary judgment, claiming as a matter of law that they were entitled to the Disputed Documents, damages, and costs, including attorney fees. Plaintiffs' motion largely ignored the court's earlier rulings that Plaintiffs were not so entitled.
[¶9] The HOA soon moved for summary judgment on all of Plaintiffs' claims, and the trial court issued findings of fact and conclusions of law resolving both summary judgment motions in the HOA's favor. The court determined it had already rejected Plaintiffs' alleged entitlement to the Disputed Documents in its order denying their motion to compel. The court also declined to revisit its ruling, noting that Plaintiffs had not timely appealed it.
[¶10] The trial court further determined that Plaintiffs' claims for injunctive relief were either moot or without legal basis. The court ruled:
• the Special Committee no longer existed and took no action during its short life. • Plaintiffs' removal from the Board complied with the HOA bylaws and Indiana law.
• Plaintiffs were not entitled to either compensatory damages or costs, including attorney fees, under the relevant statutes or bylaws.
• the two Board member defendants could not be held individually liable, as they acted only in their capacities as HOA officers/directors and Plaintiffs failed to produce evidence of bad faith or willful misconduct.
Plaintiffs do not challenge on appeal the trial court's determination as to the two Board member defendants' lack of individual liability.
Discussion and Decision
[¶11] On appeal, Plaintiffs essentially argue that the trial court should have reversed its rulings-that is, granted Plaintiffs' motion for partial summary judgment and denied the HOA's motion for summary judgment. Plaintiffs claim that summary judgment for the HOA was improper because genuine issues of material fact existed as to the formation and purpose of the Special Committee and the validity of Plaintiffs' removal from the Board. Plaintiffs also assert that they were entitled to partial summary judgment because there was no genuine issue of material fact as to their entitlement to the Disputed Documents and costs, including attorney fees.
Plaintiffs do not appear to challenge on appeal the HOA's failure to provide one portion of the Disputed Documents: the attorney opinion.
[¶12] When reviewing summary judgment rulings, we apply the same standard as the trial court. Fox v. Barker, 170 N.E.3d 662, 665 (Ind.Ct.App. 2021). The moving party bears the burden of showing that there are no genuine issues of material fact and that it is entitled to judgment as a matter of law. Id. "Summary judgment is improper if the moving party fails to meet this burden," or, if the burden is met, "the nonmoving party . . . establishes a genuine issue of material fact." Id. In our review, we construe all factual inferences in the nonmoving party's favor and all doubts as to the existence of a material issue against the moving party. Id. at 665-66.
I. The HOA Was Entitled to Summary Judgment on the Special Committee Issues
[¶13] Plaintiffs argue that the trial court granted summary judgment for the HOA by improperly construing factual inferences against Plaintiffs, the non-moving party. See id. But the only purported examples that Plaintiffs offer of this alleged error relate to the Special Committee. We find this issue moot.
[¶14] In their amended complaint, Plaintiffs sought an injunction requiring, among other things: (1) that the HOA cease "governance or conduct through the body presently denominated as 'Special Committee on Governance'"; and (2) nullification of all actions purportedly taken by, or under the auspices of, the "Special Committee on Governance" that was not properly authorized by the Board of Directors. App. Vol. III, p. 21.
[¶15] The designated evidence shows that the Special Committee met once, took no action, and is now defunct. Plaintiffs' contrary suggestions amount to speculation not supported by designated evidence (or reasonable inferences from that evidence) and, in several instances, lack citations to the record. See e.g., Appellants' Br., pp. 15-16; see Ind. Appellate Rule 46(A)(8)(a) (requiring that contentions in an appellant's brief be "supported by cogent reasoning" and "citations to the authorities, statutes, and the Appendix or parts of the Record on Appeal relied on, in accordance with Rule 22").
[¶16] As the Special Committee did not exist when summary judgment was entered, the trial court could not require that the HOA "no longer engage in any governance or conduct" through it. See App. Vol. III, p. 21. And because the Special Committee never took any action, there was nothing for the court to "nullify." Id. When a court cannot grant effective relief and its decision therefore is merely advisory, no viable claim exists, and the claim is subject to dismissal. See C.P. v. St. Vincent Hosp. &Health Care Ctr., Inc., 219 N.E.3d 142, 146-147 (Ind.Ct.App. 2023). The portion of Plaintiffs' claim relating to the Special Committee is moot and was properly resolved through the trial court's grant of summary judgment to the HOA.
Because this issue is moot, we do not address Plaintiffs' challenges to the trial court's factual findings relating to the creation and operation of the Special Committee.
II. The HOA Was Entitled to Summary Judgment as to the Disputed Documents and Costs Issues
[¶17] Plaintiffs concede that when summary judgment was entered, the HOA had provided most of the Disputed Documents. The exceptions, according to Plaintiffs, were "the legal invoices reflecting interaction with the [HOA] and the email addresses that the [HOA] uses as its primary means of communicating with the members." Appellants' Br., p. 15. Plaintiffs contend that they were entitled to access these documents and information and to recover the costs, including attorney fees, they incurred attempting to acquire them. The trial court's denial of partial summary judgment to Plaintiffs and its grant of summary judgment to the HOA both rested, in part, on the court's determination that Plaintiffs were not so entitled. We agree that summary judgment for the HOA was warranted.
A. Plaintiffs Fail to Establish Any Entitlement to the Legal Invoices
[¶18] Plaintiffs contend they were entitled to the legal invoices because those documents "were financial records subject to disclosure under I.C. § 23-17-271." Id. at 24. Plaintiffs do not explain this contention, cite to the specific language in Indiana Code § 23-17-27-1 on which they rely, provide any relevant authority, or otherwise develop this argument. Therefore, they have waived this issue. See App. R. 46(A)(8)(a).
[¶19] Given Plaintiffs' failure to establish a duty by the HOA to disclose the invoices, Plaintiffs cannot establish that the trial court erred by finding they were not entitled to them. We therefore do not address Plaintiffs' remaining claims as to the legal invoices.
B. Plaintiffs Are Not Entitled to the HOA Members' Email Addresses
[¶20] Plaintiffs next contend that Indiana Code § 32-25.5-3-1 authorizes their access to the email addresses of the HOA members. This statute provides:
(a) A homeowners association shall maintain:
(1) a current roster of all members of the association; and
(2) the mailing address and legal description for each member of the association.
(b) The homeowners association shall also maintain any electronic mail addresses or facsimile (fax) numbers of those members who have consented to receive notice by electronic mail or facsimile (fax). Electronic mail addresses and facsimile (fax) numbers provided by a member to receive notice by electronic mail or facsimile (fax) shall be removed from the association's records when the member revokes consent to receive notice by electronic mail or facsimile (fax) ....
(c) The mailing addresses and legal descriptions maintained by a homeowners association under subsection (a):
(1) shall be made available to a member of the homeowners association upon request;
(2) may be used by a member of the homeowners association only for a purpose related to the operation of the homeowners association; and
(3) may not be used by a member of the homeowners association for personal reasons.
(d) Except as provided in subsection (c), a homeowners association may not sell, exchange, or otherwise transfer information maintained by the homeowners association under this section to any person.Ind. Code § 32-25.5-3-1.
[¶21] Plaintiffs ignore the distinction made in Indiana Code § 32-25.5-3-1 between a "mailing address" for all members, discussed in subsection (a), and "electronic mail addresses" of members who opt for electronic service from the homeowners association, discussed in subsection (b). The plain language of Indiana Code § 32-25.5-3-1(c) makes clear that only the mailing addresses of members are subject to disclosure.
[¶22] Plaintiffs also incorrectly assert that Indiana Code § 23-17-27-2, which applies to nonprofit corporations, required disclosure of the email addresses. Although Plaintiffs contend that electronic email addresses are among the corporate records that Indiana Code § 23-17-27-2 requires a nonprofit corporation like the HOA to provide to a requesting member, this statute only speaks to members' mailing addresses-not their email addresses. Ind. Code § 23-17-27-1(e) (specifying a list of information that must be maintained by a nonprofit corporation that does not include any members' email addresses); Ind. Code § 23-17-27-2 (providing that absent certain statutory exceptions, "a member is entitled to inspect and copy . . . the records of the corporation described in section 1(e) of this chapter"); Ind. Code § 23-17-27-1(c) (requiring that a nonprofit corporation "maintain a record of the corporation's members in a form that permits preparation of the list of the names and addresses of all members" but not providing for similar retention of members' email addresses).
[¶23] The trial court did not err in finding as a matter of law that the HOA was not required to disclose its members' email addresses to Plaintiffs.
C. Plaintiffs Were Not Entitled to Costs
[¶24] Plaintiffs do not assert a claim for costs, including attorney fees, for their efforts to procure documents to which they are not entitled. But Plaintiffs contend that even if they were not entitled to access all the records they requested, the undisputed facts show that the HOA waited years to produce some of the records to which Plaintiffs were entitled. Plaintiffs claim they are entitled as a matter of law to attorney fees and costs under the Nonprofit Corporation Act, Indiana Code § 23-17-27 et seq., for the records belatedly produced.
[¶25] The Nonprofit Act specifies that when a nonprofit corporation does not produce records to a member "within a reasonable time" as required, the member may seek a court order "to permit inspection and copying of the records demanded." Ind. Code § 23-17-27-4(b). The Nonprofit Act also authorizes an award of costs-including attorney fees- to the member under a narrow provision:
If the court orders inspection and copying of the records demanded, the court shall also order the corporation to pay the member's costs, including reasonable attorney's fees, incurred to obtain the order unless the corporation proves that the corporation refused inspection in good faith because the corporation had a reasonable basis for doubt about the right of the member to inspect the records demanded.Ind. Code § 23-17-27-4(b) (emphasis added).
[¶26] The language of Indiana Code § 23-17-27-4(b) makes clear that a court order of production is a prerequisite to any award of costs, including attorney fees, to the member of a nonprofit corporation. Although Plaintiffs claim the trial court "ordered" the production of the documents, they fail to support that assertion with a citation to the record. Appellants' Br., p. 20 ("It was not until after being ordered by the trial court to turn over the documents in this case, in 2022, that the corporation complied with the law."). The CCS in this case shows no court order issued in 2022.
[¶27] The only citations to the record that Plaintiffs offer in support of this claim show that, in 2022, the HOA provided Plaintiffs with access to: (1) certain historical records of the HOA; (2) names and mailing addresses of the HOA members; and (3) "[m]inutes and records of actions taken without a meeting by the members, directors, and/or committees of the [HOA], each to the extent not protected by the attorney-client privilege or the work product doctrine, from January 1, 2017." Appellants' App. Vol. II, pp. 155, 168-69. Plaintiffs do not identify any prior trial court order requiring the HOA to provide this specific information to Plaintiffs. Plaintiffs therefore have not shown any right to costs, including attorney fees, under Indiana Code § 23-17-27-4. See Young v. Butts, 685 N.E.2d 147, 151 (Ind.Ct.App. 1997) ("[W]e will not search the record to find a basis for a party's argument.").
[¶28] As Plaintiffs have failed to show they are entitled to relief, we affirm the trial court's grant of summary judgment to the HOA and its denial of partial summary judgment to Plaintiffs.
Vaidik, J., and Foley, J., concur.