FOR PUBLICATION
ATTORNEY FOR APPELLANT
: ATTORNEYS FOR APPELLEE:
ANGELA M. SMITH EMILY C. GUENIN-HODSON
Hall Render Killian Heath & Lyman MARK C. GUENIN
Indianapolis, Indiana Wabash, Indiana
IN THE
COURT OF APPEALS OF INDIANA
COLLECTIONS, INC., )
)
Appellant-Defendant, )
)
vs. ) No. 27A04-0402-CV-92
)
JOE D. WOLFE, )
)
Appellee-Plaintiff. )
APPEAL FROM THE GRANT SUPERIOR COURT
The Honorable Natalie Conn, Special Judge
Cause No. 27D03-0304-SC-1357
October 29, 2004
OPINION - FOR PUBLICATION
SHARPNACK, Judge
[Wolfe] further agrees to be responsible for court costs and reasonable attorneys fees
in the event it is necessary for [the Hospital] to engage attorneys to
collect this sum from [Wolfe.]
This Agreement may be terminated by either party giving thirty (30) days written
notice to the other party. If this Agreement is terminated without cause
by [the Hospital], [Wolfe] shall not have any obligation to repay [the Hospital]
or to fulfill any employment requirement. If this Agreement is terminated by
[Wolfe], repayment terms of the Agreement will apply.
Id. (emphasis in original). Wolfe resigned from his employment with the Hospital
on September 13, 2002, three months before the end of the Agreements three-year
term. Wolfe did not repay the $4,500.00 bonus when he resigned.
Collections filed a notice of small claims lawsuit against Wolfe and requested a
judgment in the amount of $4,500.00 plus interest and attorney fees of $1,500.00.
After a bench trial, the small claims court entered the following order:
[T]he Commitment Bonus Agreement drafted by the hospital is somewhat ambiguous as to
whether [Wolfe] would be a full time employee or only that he would
be full-time eligible. In the event a [contract] is found to be
ambiguous, those terms will normally be construed against the party who employed the
language. The hospital received the majority of the bargain for which they
contracted because [Wolfe] was employed and worked even above expectations for 33 of
the 36 months called for in the contract.
However, [Wolfe] did fail to fulfill the entire term of the agreement and
therefore should not receive the full benefit of the contract.
Judgment for [Collections] against [Wolfe] for $500.00, plus attorney fees of $500.00.
Cost to be paid by [Wolfe].
Id. at 4 (emphasis in original).
The issue is whether the small claims courts damage award is clearly erroneous
because it did not award Collections the full amount of damages specified in
the contract. The small claims court entered sua sponte findings of fact
and conclusions thereon. Sua sponte findings control only as to the issues
they cover, and a general judgment will control as to the issues upon
which there are no findings. Yanoff v. Muncy, 688 N.E.2d 1259, 1262
(Ind. 1997). We will affirm a general judgment entered with findings if
it can be sustained on any legal theory supported by the evidence.
Id. When a court has made special findings of fact, we review
sufficiency of the evidence using a two-step process. Id. First, we
must determine whether the evidence supports the trial courts findings of fact.
Id. Second, we must determine whether those findings of fact support the
trial courts conclusions of law. Id.
Findings will only be set aside if they are clearly erroneous. Id.
Findings are clearly erroneous only when the record contains no facts to
support them either directly or by inference. Id. A judgment is
clearly erroneous if it applies the wrong legal standard to properly found facts.
Id. In order to determine that a finding or conclusion is
clearly erroneous, an appellate courts review of the evidence must leave it with
the firm conviction that a mistake has been made. Id. When
the specific issue on review relates to questions of inadequate or excessive damages,
we should not reverse a damage award if the award is within the
scope of the evidence before the trial court, and we may not reweigh
the evidence or judge the credibility of the witnesses. Dunn v. Cadiente,
516 N.E.2d 52, 54 (Ind. 1987), rehg denied.
Collections argues that the small claims court should have awarded a judgment against
Wolfe in the amount of $4,500.00 plus attorney fees of $500.00. According
to Collections, the $500.00 damage award is not within the scope of the
evidence.
See footnote Wolfe argues that the small claims courts order is not clearly
erroneous because Wolfe had substantially performed his duties under the contract and the
law disfavors forfeiture of compensation.See footnote
Collections relies, in part, upon
Dove v. Rose Acre Farms, Inc., 434 N.E.2d
931 (Ind. Ct. App. 1982). There, the employee was promised a $5,000
bonus if he completed certain construction work within ten weeks, worked at least
five full days a week for the same ten weeks, and was not
tardy or absent. Id. at 932. In the tenth week, the
employee became sick due to strep throat and missed two days of work.
Id. at 932-933. As a result, the employer refused to give
the bonus to the employee. Id. at 933.
On appeal, we noted that the doctrine of [s]ubstantial performance applies where performance
of a nonessential condition is lacking, so that the benefits received by a
party are far greater than the injury done to him by the breach
of the other party. Id. However, we determined that the doctrine
of substantial performance was not applicable because the employee violated an essential condition
of the bonus agreement, i.e. the agreements tardiness and absenteeism rules. Id.
at 935. We noted [i]t is difficult for plaintiff to extricate himself
from the conditions of employment which he has voluntarily assumed, for even though
the forfeiture provisions seem harsh, we can only interpret the contract which the
parties have made. Id. at 934 (quoting Muir v. Leonard Refrigerator Co., 257
N.W. 723, 724 (Mich. 1934)). The employee willingly entered into the bonus
arrangement, and he must be held to have agreed to all of the
terms upon which the bonus was conditioned. If the conditions were unnecessarily
harsh or eccentric, and the terms odious, he could have shown his disdain
by simply declining to participate, for participation in the bonus program was not
obligatory or job dependent. Id. at 935. Consequently, we held that
the employee was not entitled to recover any portion of the bonus.
Id. at 936.
Similarly, here, the three-year term was an essential element of the Agreement.
Although the Agreement may seem harsh because Wolfe had completed all but three
months of the Agreement, we are constrained to interpret the Agreement that the
parties made. The Agreement clearly provided that: (1) Should [Wolfe] cease to
be employed for any reason . . . on or before December 13,
2002, [Wolfe] shall return the full amount of the Bonus to [the Hospital]
. . . ; and (2) If this Agreement is terminated by [Wolfe],
repayment terms of the Agreement will apply. Appellants Appendix at 4 (emphasis
in original). Thus, if Wolfe terminated his employment before December 13, 2002,
he was required to repay the entire bonus. Because Wolfe terminated his
employment three months before the end of the Agreements term, the repayment provisions
of the Agreement require him to repay the entire $4,500.00 bonus. Consequently,
we conclude that the small claims court erred by entering a judgment that
only required Wolfe to repay $500.00 of the $4,500.00 bonus. See, e.g.,
Dove, 434 N.E.2d at 934-935.
For the foregoing reasons, we reverse the judgment of the small claims court
and remand for proceedings consistent with this opinion.
Reversed and remanded.
BAILEY, J. and MAY, J. concur