MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),                                        FILED
this Memorandum Decision shall not be                                    Jun 24 2019, 8:28 am
regarded as precedent or cited before any                                     CLERK
court except for the purpose of establishing                              Indiana Supreme Court
                                                                             Court of Appeals
the defense of res judicata, collateral                                        and Tax Court


estoppel, or the law of the case.


ATTORNEYS FOR APPELLANT                                  ATTORNEYS FOR APPELLEES
Curtis T. Hill, Jr.                                      PFISTER AND SOPKO
Attorney General of Indiana                              Greg A. Bouwer
                                                         Jeff Carroll
Frances Barrow                                           Koransky Bouwer & Poracky, P.C.
Deputy Attorney General                                  Dyer, Indiana
Indianapolis, Indiana
                                                         ATTORNEY FOR APPELLEE OHIO
                                                         FARMERS
                                                         Stephen C. Wheeler
                                                         Smith Fisher Maas Howard &
                                                         Lloyd, P.C.
                                                         Indianapolis, Indiana




                                           IN THE
    COURT OF APPEALS OF INDIANA

State of Indiana ex rel. Curtis T.                       June 24, 2019
Hill, Attorney General of                                Court of Appeals Case No.
Indiana,                                                 18A-PL-771
Appellant-Plaintiff,                                     Appeal from the Lake Circuit
                                                         Court
        v.                                               The Honorable Marissa J.
                                                         McDermott, Judge
William J. Pfister, Richard A.                           Trial Court Cause No.
Sopko, Travelers Insurance                               45C01-1705-PL-51
Companies, Western Surety

Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019                       Page 1 of 21
      Insurance Company, and Ohio
      Farmers Insurance Company,
      Appellees-Defendants.



      Brown, Judge.


[1]   The State of Indiana ex rel. Curtis T. Hill, Jr., Attorney General of Indiana (the

      “State”) appeals the trial court’s entry of summary judgment in favor of

      William J. Pfister, Richard A. Sopko, and Ohio Farmers Insurance Company

      (“Ohio Farmers”). The State raises several issues which we consolidate and

      restate as whether the court erred in entering summary judgment. We affirm.


                                           Facts and Procedural History

      A. Background


[2]   This appeal stems from a complaint brought by the State against Pfister and

      Sopko, officials of the School Town of Munster, Lake County (the “School

      Town”), and Ohio Farmers, 1 pursuant to Ind. Code § 5-11 et seq., seeking to

      recover funds related to allegations of “malfeasance, misfeasance, and/or

      nonfeasance on the part of Pfister and Sopko” occurring from July 1, 1999, to

      June 30, 2014. Appellant’s Appendix Volume II at 47.




      1
          The State also sought recovery from parties that do not participate in this appeal.


      Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019               Page 2 of 21
               1. Pfister’s Contracts


[3]   From July 1, 1999, through February 1, 2009, the School Town entered into

      twelve Superintendent’s Contracts with Pfister that contained provisions for

      various fringe benefits. Pfister’s contracts from 1999 to 2003 were signed by the

      President and Secretary of the Board of School Trustees (the “Board”), and his

      contracts from 2004 to 2009 were signed by the President, Vice President,

      Secretary, and two members of the Board. 2


[4]   Pfister’s contracts from 1999 to 2000 stated that the School Town shall pay his

      “annual contribution to the Indiana State Teachers[’] Retirement Fund.” 3

      Appellant’s Appendix Volume III at 69, 74, 80. The June 27, 2001 contract

      stated that it shall pay his “annual contribution to the Indiana State Teachers[’]

      Retirement Fund, plus an additional 2% toward his Indiana Teacher

      Retirement Fund.” Id. at 85. The June 27, 2002 contract stated that it shall pay

      his “annual contribution to the Indiana State Teachers[’] Retirement Fund, plus




      2
        According to the version of the School Town’s Bylaws and Policies which was designated in support of
      Pfister and Sopko’s summary judgment motion, the Board consists of five members and serves as the
      governing body for, and conducts the supervision of, the School Town, which is a body corporate capable of
      suing and being sued. The Board exercises executive power by appointing the Superintendent and annually
      “evaluate[s] the performance of the Superintendent.” Appellant’s Appendix Volume III at 60. As an
      outcome of the evaluation of the Superintendent’s performance, the Board “judge[s] the advisability of
      retention of the Superintendent” and is better prepared to “determine the Superintendent’s advisory and
      benefit package.” Id. at 61. Further, the School Town’s Bylaws and Policies provide that, “[i]f the services of
      the superintendent are found to be unsatisfactory to the Board, the Superintendent shall be notified in writing
      by the President, as approved by the Board, that his/her contract will expire upon the expiration date set
      forth in the contract.” Id. at 62.
      3
       Two Superintendent’s Contracts, dated June 21 and October 20, 2000, contain the same relevant language
      as the July 1, 1999 contract.



      Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019                       Page 3 of 21
      each year an additional 2% toward an annuity of his choice.” Id. at 91. The

      June 27, 2003 contract stated that it shall pay his “annual contribution to the

      Indiana State Teachers[’] Retirement Fund, plus each year an additional 4%

      toward an annuity of his choice.” Id. at 97. The language from Pfister’s 2003

      contract appeared in each of his contracts from 2004 to 2009.


               2. Sopko’s Contracts


[5]   From July 1, 1998, through July 1, 2011, the School Town entered into

      fourteen Assistant Superintendent’s Contracts with Sopko, 4 and on July 1,

      2012, it entered into a Superintendent’s Contract with him that provided that he

      would “devote his entire time and energy to his duties as . . . Superintendent.”

      Id. at 207. Each of Sopko’s contracts contained provisions for various fringe

      benefits, his contracts from 1998 to 2005 were signed by the President and

      Secretary of the Board, and his contracts from 2006 to 2012 were signed by the

      President, Vice President, Secretary, and two members of the Board.


[6]   Sopko’s contracts from 1998 to 2000 stated that the School Town shall pay his

      “annual contribution to the Indiana State Teachers’ Retirement Fund.” Id. at

      138. His June 27, 2001 contract stated that it shall pay his “annual contribution

      to the Indiana State Teachers’ Retirement Fund, plus an additional 2% toward




      4
       According to the School Town’s Bylaws and Policies which Pfister and Sopko designated, the assistant
      superintendent is considered an administrator, and the Board “approve[s] the employment, fix[es] the
      compensation and establish[es] the term of employment for each administrator.” Appellant’s Appendix
      Volume III at 63. Further, the Board “give[s] written notice of renewal or refusal to renew” an assistant
      superintendent’s contract. Id. at 65.

      Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019                      Page 4 of 21
      his Indiana Teacher Retirement Fund.” Id. at 151. His June 27, 2002 contract

      stated that it shall pay his “annual contribution to the Indiana State Teachers’

      Retirement Fund, plus each year an additional 2% toward an annuity of his

      choice.” Id. at 156. His June 27, 2003 contract stated that it shall pay his

      “annual contribution to the Indiana State Teachers’ Retirement Fund, plus each

      year an additional 3% toward an annuity of his choice.” Id. at 161. The

      language from Sopko’s 2003 contract appeared in each of his contracts from 2004

      to 2011, and his 2012 superintendent’s contract does not mention annuity

      contributions in the section detailing fringe benefits.


              3. Accounts Payable Vouchers and Voucher Registers


[7]   In November 2003, the School Town’s Director of Financial Operations and

      Treasurer, Janice Swanson, signed an Accounts Payable Voucher for the School

      Town that reported that school year’s initial deposit to pension bond funds to

      payee “Valic” for “Group #1456, 401A Account, CS3-Plan 2, Subgroup #1

      (William Pfister & Richard Sopko).” Appellant’s Appendix Volume III at 217.

      Each year from 2004 through 2013, she signed an Accounts Payable Voucher

      that reported an amount for that school year’s employer retirement contribution

      to payee “Valic” for “Group #1456, 401A Account, CS3-Plan 2, Subgroup #1 -

      William Pfister & Richard Sopko.” Id. at 222. Accord id. at 227, 232, 237, 243,

      248; Appellant’s Appendix Volume IV at 5, 11, 17, 23. In 2014, she signed an

      Accounts Payable Voucher for that school year’s employer retirement

      contribution to payee “Valic” for “Group #1456, 401A Account, CS3-Plan 2,

      Subgroup #1 for Richard A. Sopko.” Id. at 29. On each of the 2003-2014

      Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019   Page 5 of 21
      Vouchers, Swanson’s signature appears below the statement, “I hereby certify

      that the attached invoice(s), or bill(s), is (are) true and correct and I have

      audited same in accordance with IC 5-11-10-1.6.” 5 Appellant’s Appendix

      Volume III at 217. Accord id. at 227, 232, 237, 243, 248; Appellant’s Appendix

      Volume IV at 5, 11, 17, 23, 29.


[8]   At each regular meeting held in June of the School Town’s Board, from 2000

      until 2004, from 2006 until 2007, and from 2009 until 2013, the Board

      approved, by motion, an Accounts Payable Voucher Register that had been

      “hand delivered to each [Board] member before the public meeting that was

      held to approve them.” 6 Appellant’s Appendix Volume III at 214. Documents

      titled “Accounts Payable Voucher Register,” which stated “We have examined

      the vouchers on the foregoing Accounts Payable Voucher Register consisting of

      ___ pages and, except for vouchers not allowed as shown on the register, such

      vouchers are hereby allowed in the total amount of . . . ,” were signed by the

      President, Vice President, Secretary, and two members of the Board, and

      approved each year from 2003 to 2014. Id. at 216. Accord id. at 221, 226, 231,

      236, 242, 247; Appellant’s Appendix Volume IV at 4, 10, 16, 22, 28.




      5
        Ind. Code § 5-11-10-1.6 (2003) provided that the “fiscal officer of a governmental entity may not draw a
      warrant or check for payment of a claim unless . . . the fiscal officer audits and certifies before payment that
      the invoice or bill is true and correct.” (Subsequently amended by Pub. L. No. 1-2005, § 78 (eff. July 1,
      2005); Pub. L. No. 169-2006, § 4 (eff. July 1, 2006); Pub. L. No. 182-2009(ss), § 77 (eff. January 1, 2010).
      6
        In 2005, according to the June 6 minutes of a Regular Board Meeting, the Accounts Payable Voucher was
      “presented at Special Board Meeting on June 10, 2005.” Appellant’s Appendix Volume V at 209. The
      record does not contain a copy of the minutes of June 20, 2005 Special Board Meeting.

      Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019                          Page 6 of 21
               4. The Ohio Farmers’ Policies


[9]    On or about July 1, 1997, Ohio Farmers issued Policy No. CBP 5634356

       (“Policy No. 1”) to the School Town. Policy No. 1 indicated that the policy

       period was from July 1, 1997, to July 1, 2000, and stated the policy “Consists

       Of The Following Coverage Parts: Commercial Crime Coverage Part.”

       Appellant’s Appendix Volume II at 182. In the “General Conditions”

       subsection under the Crime General Provisions, it states “Discovery Period for

       Loss: We will pay only for covered loss discovered no later than one period

       from the end of the policy period.” Id. at 192. Ohio Farmers did not renew

       Policy No. 1.


[10]   On July 1, 2002, Ohio Farmers issued Policy No. 5260158 (“Policy No. 2”) to

       the School Town. Policy No. 2 indicated the policy period was from July 1,

       2002, to July 1, 2005, and stated that the policy “Consists Of The Following

       Coverage Parts: Commercial Crime Coverage Part.” Id. at 220. In the

       “General Conditions” subsection under the “Crime General Provisions (Loss

       Sustained Form),” it stated “Extended Period to Discover Loss: We will pay

       only for covered loss discovered no later than 1 year from the end of the Policy

       Period.” Exhibit IX at 17-18. Accord id. at 46-47, 78-79.


[11]   On July 1, 2005, Ohio Farmers issued a renewal of Policy No. 2 (“Policy No. 2

       Renewal”) for the period from July 1, 2005, to July 1, 2008, to the School

       Town. Policy No. 2 Renewal contains the same statements regarding the

       “Extended Period to Discover Loss” as Policy No. 2. Ohio Farmers did not


       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019   Page 7 of 21
       renew Policy No. 2 Renewal at its expiration on July 1, 2008.                            Further, since

       the expiration of Policy No. 2 Renewal, Ohio Farmers “has not written an

       Employee Dishonesty policy” for the School Town. Appellant’s Appendix

       Volume VIII at 158.


                5. State Board of Accounts’ Biennial Audit Reports


[12]   Pursuant to Ind. Code § 5-11-1-9(a), the State Board of Accounts (the “SBOA”)

       conducted regular biennial audit examinations of the School Town during the

       time period relevant to this appeal. 7 As part of the audit process, the SBOA

       requested that Pfister provide documents, including the Superintendent’s and

       Assistant Superintendent’s Contracts into which he and Sopko entered, and he

       did so. The SBOA issued six audit reports (collectively, the “Biennial Audit

       Reports”), each covering two-year increments and together spanning from July

       1, 2001, to June 30, 2013. In an initial letter addressed to the School Town,

       each Biennial Audit Report stated:


                [W]e conducted our audit in accordance with auditing standards
                generally accepted in the United States. Those standards require
                that we plan and perform the audit to obtain reasonable



       7
         The SBOA is tasked with “examin[ing] all accounts and all financial affairs of every public office and
       officer, state office, state institution, and entity.” See Ind. Code § 5-11-1-9(a) (1999) (subsequently amended
       by Pub. L. No. 4-2005, § 25 (eff. February 9, 2005); Pub. L. No. 213-2007, § 2 (eff. July 1, 2007); Pub. L. No.
       217-2007, § 2 (eff. July 1, 2007); Pub. L. No. 172-2011, § 12 (eff. May 10, 2011); and Pub. L. No. 280-2013, §
       3 (eff. May 11, 2013)). Ind. Code § 5-11-1-16(c) (1993) provided that “public office” means “the office of any
       and every individual who for or on behalf of the state or any municipality . . . holds, receives, disburses, or
       keeps the accounts of the receipts and disbursements of any public funds,” while subsection 16(a) provided
       that “municipality” means “any county, township, city, town, school corporation, special taxing district, or
       other political subdivision of Indiana.” (Subsequently amended by Pub. L. No. 104-2014 (eff. March 25,
       2014)).

       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019                        Page 8 of 21
               assurance about whether the financial statements are free of
               material misstatement. An audit includes examining, on a test
               basis, evidence supporting the amounts and disclosures in the
               financial statements. An audit also includes assessing the
               accounting principles used and significant estimates made by
               management, as well as evaluating the overall financial statement
               presentation. We believe that our audit provides a reasonable
               basis for our opinions.


       Appellant’s Appendix Volume IV at 41. Accord id. at 86, 125, 182, 231;

       Appellant’s Appendix Volume V at 29.


       B. SBOA Special Investigation Report, the State’s Complaint, and Subsequent

           Proceedings


[13]   On July 24, 2015, Attorney Kathleen M. Maicher, representing the School

       Town, sent a letter to the Office of the Prosecuting Attorney of Lake County and

       the SBOA which indicated that, “[p]ursuant to Indiana Code § 5-11-1-27(j),” she

       wished to advise them of suspected misappropriation of School Town funds by

       then-former superintendents Pfister and Sopko and which referenced the

       “benefits and severance payments to be paid under the Superintendent’s

       contract.” Appellant’s Appendix Volume IV at 32. The letter indicated in part

       that contracts for both administrators contained references to an “Annuity Starter

       401(a)” and that Pfister proposed in 2000-2001 that the School Town pay him

       and Sopko an additional 2% toward their Indiana Teacher Retirement Fund and

       the Board agreed. Id. at 33. The letter also stated:


               In the 2003-2004 school year contract, [Pfister] proposed raising
               [the School Town’s] annuity contribution to 4% of his salary and

       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019   Page 9 of 21
               to raise [Sopko’s] annuity to 3% of his salary and [the School
               Town] agreed. [Pfister and Sopko], however, interpreted the
               annuity starter clause to mean that each year the stated
               percentage would be added to the figure from the prior year
               resulting in an ever increasing percentage that would be
               multiplied against their total salary to calculate the amount of
               their annuity payment.

               Most of the School Board members thought that the percentage
               identified in the contracts (i.e., 2% and later 4% for [Pfister] and
               2% and later 3% for [Sopko]) would be a constant number
               multiplied each year against [Pfister’s and Sopko’s] increasing
               salary to calculate the amount of the Annuity Starter payment.
               The members were not informed of the exact amount of the
               annuity contributions.

               The dramatic financial consequences of [Pfister’s and Sopko’s]
               interpretation of the contract were obvious. By the time they
               chose to retire, the multiplier against their salaries had increased
               to 42% and 36%, respectively.


       Id. at 33-34.


[14]   On October 25, 2015, SBOA field examiner Karen Tetrault was assigned to

       investigate the School Town’s financial records, books, accounts, and contracts

       from July 1, 1999, to June 30, 2014, due to suspected malfeasance, misfeasance,

       and/or nonfeasance. On June 8, 2016, the SBOA issued Special Investigation

       Report B46414 (the “Special Investigation Report”), based on an investigation

       limited to “Salary Contracts, Payroll Records and Annuity payments,” and




       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019   Page 10 of 21
       referred it to the Indiana Attorney General’s Office pursuant to Ind. Code § 5-11-

       5-1(a). 8 Appellant’s Appendix Volume V at 137.


[15]   On May 23, 2017, the State filed a Complaint to Recover Public Funds against

       Pfister, Sopko, Ohio Farmers, and others, alleging that the Special Investigation

       Report had “disclosed malfeasance, misfeasance, and/or nonfeasance on the

       part of Pfister and Sopko” and “was placed by the State Examiner with the

       Attorney General pursuant to Ind. Code § 5-11-5-1(a).” Appellant’s Appendix

       Volume II at 47. Counts I and II of the Complaint allege: from 2001 to 2012,

       Pfister was wrongfully paid in excess of his contracted Annuity Starter in the

       total amount of $359,728.94 and, as a direct and proximate result of his

       multiple breaches of duty, the School Town suffered a pecuniary loss of

       $463,922.75; that, during the same period, Sopko was wrongfully paid in excess

       of his contracted Annuity Starter in the total amount of $311,198.75 and, as a

       direct and proximate result of his multiple breaches of duty, the School Town

       suffered a pecuniary loss of $377,475.28; and that the SBOA had incurred

       $10,053.32 of additional audit costs as a result of the breaches of duty of Pfister

       and Sopko. Counts III and IV seek treble damages in the amount of

       $1,391,768.25 from Pfister and $1,132,425.84 from Sopko, respectively, and

       state that the State was a party suffering a pecuniary loss and “on behalf of the



       8
         Ind. Code § 5-11-5-1(a) (2016) provided in relevant part that, if an examination made under the article
       “discloses malfeasance, misfeasance, or nonfeasance in office or of any officer or employee, a copy of the
       report, signed and verified, shall be placed by the state examiner with the attorney general and the inspector
       general.” Subsequently amended by Pub. L. No. 188-2016, § 5 (eff. July 1, 2016).



       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019                       Page 11 of 21
       School Town” was entitled to the relief described in Ind. Code § 34-24-3-1. 9 Id.

       at 56-57. Count VII alleges that three crime insurance policies covering Pfister

       provided “$5,000 in coverage from July 1, 1997 to July 1, 2000, $5,000 in

       coverage from July 1, 2002 to July 1, 2005, and $5,000 in coverage from July 1,

       2005 to July 1, 2008,” and that, as a result of Pfister’s actions, Ohio Farmers

       was jointly and severally liable in the amount of $15,000. 10 Id. at 61. The State

       attached copies of Policy Nos. 1 and 2 and Policy No. 2 Renewal to the

       Complaint.


[16]   On October 26, 2017, Pfister and Sopko filed a motion for summary judgment

       and designated the School Town’s Bylaws and Policies; Pfister and Sopko’s

       superintendent and assistant superintendent contracts, the attendant Accounts

       Payable Voucher Registers for the School Town, and an Affidavit of Business

       Records Custodian For Authenticating Written Documents Relating to Docket

       Voucher Registers by Swanson; the SBOA’s Biennial Audit Reports; the

       SBOA’s Special Investigation Report; and the minutes of regular meetings held

       in June of the School Town’s Board from 2000 until 2007 and from 2009 until




       9
         Ind. Code § 34-24-3-1 (2011), which is often referred to as the Crime Victims Relief Act and is titled
       “Pecuniary loss as result of property offenses,” provides in part that a person, with “an unpaid claim on a
       liability that is covered by IC 24-4.6-5” or who “suffers a pecuniary loss as a result of a violation of IC 35-43,
       IC 35-42-3-3, IC 35-42-3-4, or IC 35-45-9,” may bring a civil action for: “[a]n amount not to exceed three (3)
       times . . . the actual damages of the person suffering the loss,” “[t]he costs of the action,” “[a] reasonable
       attorney’s fee,” and “[a]ll other reasonable costs collection.” Subsequently amended by Pub. L. No. 276-
       2019, § 1 (eff. July 1, 2019).
       10
         The initial complaint named defendant Westfield Companies in Count VII. (61) An entry in the
       chronological case summary dated August 7, 2017, states “Order dated 07-31-17, Court Grants order
       Suibstitution [sic] [Ohio Farmers] for Westfield Companies As the Real Party Defendant In Interest For
       Count VII of Complaint.” Appellant’s Appendix Volume II at 13.

       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019                          Page 12 of 21
       2013. The Accounts Payable Voucher Registers included copies of checks from

       the School Town payable to Valic and the School Town’s Accounts Payable

       Vouchers. The records contained in the Account Payable Voucher Register for

       2007 included a document titled “Annuity Contribution to Valic for

       Superintendent and Assistant Superintendent Per Supplemental Contracts” and

       states that the “Employer Contribution Pension Accounts” for Pfister was “22%

       of Salary[,] $164,440 x .22 = $36,177” and for Sopko was “18% of Salary[,]

       $137,766 x .18 = $24,798.” Appellant’s Appendix Volume III at 238.

       Additional records contained in the Account Payable Voucher Register further

       indicate that the employer contribution to pension accounts for Pfister was

       “30% of Salary[,] $177,964 x .30 = $53,389” in 2009, “34% of Salary[,]

       $182,888 x .34 = $62,182” in 2010, “38% of Salary[,] $177,501 x .38 = $67,450”

       in 2011, and “42% of Salary[,] $178,101 x .42 = $74,802” in 2012; and for

       Sopko was “24% of Salary[,] $152,747 x .24 = $36,659” in 2009, “27% of

       Salary[,] $156,806 x .27 = $42,338” in 2010, “30% of Salary[,] $152,619 x .30 =

       $45,786” in 2011, “33% of Salary[,] $154,643 x .33 = $51,032” in 2012, and

       “36% of Salary[,] $155,243 x .36 = $55,887” in 2013. 11 Id. at 249; Appellant’s

       Appendix Volume IV at 6, 12, 19, 24.


[17]   Also on October 26, 2017, Ohio Farmers filed a Motion for Partial Summary

       Judgment Against Count VII of the Complaint and, in support of its motion, a




       11
          The Account Payable Voucher with an invoice date of “2/15/2013” indicates that Sopko’s employer
       retirement contribution for 2012-2013 was “$55,887.00.” Appellant’s Appendix Volume IV at 23.

       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019                Page 13 of 21
       Notice of Filing Discovery Request and Discovery Response that contained the

       State’s responses to Ohio Farmers’ first set of interrogatories. The State’s

       answer to Question 2(e) references a “four (4) page e-mail stream,” attached to

       the first set of interrogatories as Exhibit 1, and states that “the e-mails

       accurately set forth [the State’s] position that the loss [set forth in Complaint

       VII] was discovered by the School Town in June/July 2015; however, the loss

       was not discovered by [the State] until [the Special Investigation Report] was

       issued on June 8, 2016.” Appellant’s Appendix Volume VIII at 139.


[18]   On November 16, 2017, Pfister and Sopko filed a Motion to Compel and

       requested that the State produce the notes and paperwork associated with the

       Biennial Audit Reports. On November 22, 2017, the State filed a response in

       opposition to Ohio Farmer’s motion for partial summary judgment, and on

       November 28, 2017, it filed a response in opposition to Pfister and Sopko’s

       motion for summary judgment.                On December 8, 2017, the State filed a

       response in opposition to Pfister and Sopko’s motion to compel, in which it

       indicated that the work papers and notes accompanying four of the Biennial

       Audit Reports had been destroyed “pursuant to the Records and Retention

       Schedule” and were no longer in existence and argued that Pfister and Sopko’s

       document requests would require the State to “spend hundreds of exhaustive

       hours compiling and preparing work papers for prior SBOA audit reports

       clearly irrelevant to the present matter.” Appellant’s Appendix Volume VI at

       185.




       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019    Page 14 of 21
[19]   On January 25, 2018, the court held a hearing on the summary judgment

       motions and entered a Miscellaneous Order that set Pfister and Sopko’s motion

       to compel for a hearing and required the State to bring to the hearing a

       “detailed privilege log as well as copies of the responsive documents it has not

       produced so that the court may conduct an in camera inspection of the same.”

       Appellant’s Appendix Volume X at 198.


[20]   On March 27, 2018, the court entered an order granting summary judgment in

       favor of Pfister as to the treble damages claim and as to all claims for repayment

       of monies paid out before May 23, 2012; in favor of Sopko as to the treble

       damages claim and “as to all claims for repayment except as to the annuity

       payment of February 15, 2013” and any non-annuity payment paid before May

       23, 2012; and in favor of Ohio Farmers on Count VII of the Complaint.

       Appellant’s Appendix Volume II at 43.


                                                    Discussion

[21]   The issue is whether the trial court erred in entering summary judgment in

       favor of Pfister, Sopko, and Ohio Farmers. Summary judgment is appropriate

       only where there is no genuine issue of material fact and the moving party is

       entitled to judgment as a matter of law. Ind. Trial Rule 56(C); Mangold ex rel.

       Mangold v. Ind. Dep’t of Natural Res., 756 N.E.2d 970, 973 (Ind. 2001). All facts

       and reasonable inferences drawn from those facts are construed in favor of the

       nonmovant. Mangold, 756 N.E.2d at 973. Our review of a summary judgment

       motion is limited to those materials designated to the trial court. Id. We must

       carefully review a decision on summary judgment to ensure that a party was
       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019   Page 15 of 21
       not improperly denied its day in court. Id. at 974. In reviewing a grant of

       summary judgment we face the same issues as the trial court and follow the

       same process. Klinker v. First Merchs. Bank, N.A., 964 N.E.2d 190, 193 (Ind.

       2012). Under Trial Rule 56(C), the moving party bears the burden of making a

       prima facie showing that there are no genuine issues of material fact and that it is

       entitled to judgment as a matter of law. Id. If it is successful, the burden shifts

       to the nonmoving party to designate evidence establishing the existence of a

       genuine issue of material fact. Id.


[22]   The State argues that its actions to recover public funds and for treble damages

       were timely. It contends that the authority of the Attorney General derives only

       from statutes and that an action to recover public funds, under Ind. Code § 5-

       11-5-1(a), is not conditioned on the competent and diligent efforts of local

       governments. It further contends that the Attorney General had no means of

       discovering the information in the Special Investigation Report until June 8,

       2016, when it was first placed with him as required by Ind. Code § 5-11-5-1(a).

       The State points, in a notice of additional authority, to this Court’s recent

       decision in Robertson v. State ex rel. Hill (filed March 29, 2019), Ind. App. No.

       18A-PL-1002. 12




       12
         By separate order, we grant Pfister and Sopko’s March 29, 2019 Motion for Leave to Submit Supplemental
       Brief Addressing Additional Authority and the State’s April 12, 2019 Motion for Leave to File Reply
       Regarding Notice of Additional Authority. Further, by separate order, we deny Ohio Farmers’ November
       12, 2018 Motion to Dismiss Appeal as to Ohio Farmers.

       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019                Page 16 of 21
[23]   The general purpose of a statute of limitations is to encourage the prompt

       presentation of claims. Russo v. S. Developers, Inc., 868 N.E.2d 46, 48 (Ind. Ct.

       App. 2007) (citing Havens v. Ritchey, 582 N.E.2d 792, 794 (Ind. 1991)). In

       Indiana, statutes of limitations “are enacted upon the presumption that one

       having a well-founded claim will not delay in enforcing it.” V. Ganz Builders &

       Dev. Co., Inc. v. Pioneer Lumber, Inc., 59 N.E.3d 1025, 1032 (Ind. Ct. App. 2016)

       (quoting Morgan v. Benner, 712 N.E.2d 500, 502 (Ind. Ct. App. 1999), reh’g

       denied, trans. denied), reh’g denied, trans. denied.


[24]   Under Indiana’s discovery rule, a cause of action accrues, and the limitations

       period begins to run, when a claimant knows or in the exercise of ordinary

       diligence should have known of the injury. Cooper Indus., LLC v. City of S. Bend,

       899 N.E.2d 1274, 1280 (Ind. 2009) (citing Wehling v. Citizens Nat’l Bank, 586

       N.E.2d 840 (Ind. 1992)). The accrual of a cause of action is a question of law,

       “as ‘it is well-established in Indiana law that it is the courts’ responsibility to

       determine, based on the facts of each case, when the cause of action accrues.’”

       Prime Mortg. USA, Inc. v. Nichols, 885 N.E.2d 628, 639 (Ind. Ct. App. 2008)

       (quoting Autocephalous Greek-Orthodox Church of Cyprus v. Goldberg & Feldman

       Fine Arts, Inc., 917 F.2d 278, 288 (7th Cir. 1990), reh’g denied). For an action to

       accrue, it is not necessary that the full extent of the damage be known or even

       ascertainable, but only that some ascertainable damage has occurred. Cooper

       Indus., LLC, 899 N.E.2d at 1280 (citing Pflanz v. Foster, 888 N.E.2d 756, 759

       (Ind. 2008)). “A statute of limitations defense is particularly appropriate for

       summary judgment determination.” V. Ganz Builders & Dev. Co., Inc., 59 N.E.3d

       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019   Page 17 of 21
       at 1032 (quoting Stickdorn v. Zook, 957 N.E.2d 1014, 1021 (Ind. Ct. App. 2011)).

       If the undisputed facts establish “that the complaint was filed after the running

       of the applicable statute of limitations, the trial court must enter judgment for

       the defendant.” Martin v. Brown, 716 N.E.2d 1030, 1033 (Ind. Ct. App. 1999).


[25]   Ind. Code § 5-11-1-27(j) (2015), to which Attorney Maicher’s letter to the

       SBOA cited, provides that “[a]ll erroneous or irregular material variances,

       losses, shortages, or thefts of political subdivision funds or property shall be

       reported immediately” to the SBOA, and Ind. Code § 5-11-1-27(c) (2011), from

       which subsection -27(j) originated, provided that “[a]ll erroneous or irregular

       variances, losses, shortages, or thefts of local government funds or property

       shall be reported immediately” to the SBOA. (Subsequently amended by Pub.

       L. No. 184-2015, § 6 (eff. July 1, 2015)). Ind. Code § 34-11-2-6 provides that an

       action against a public officer “growing out of a liability incurred by doing an

       act in an official capacity, or by the omission of an official duty, must be

       commenced within five (5) years after the cause of action accrues.” Claims for

       treble damages brought under the Crime Victims Relief Act (“CVRA”) are

       subject to a two-year statute of limitations. See Mizen v. State ex rel. Zoeller, 72

       N.E.3d 458, 466 (Ind. Ct. App. 2017) (“It is long settled that ‘because the

       substance of a claim under [the CVRA] is punitive rather than compensatory,

       such claims are subject to a two-year statute of limitations.’”) (quoting Prime

       Mortg. USA, Inc. v. Nichols, 885 N.E.2d 628, 638 (Ind. Ct. App 2008)), trans.

       denied.




       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019   Page 18 of 21
[26]   The State’s May 23, 2017 complaint sought to recover funds paid to Pfister and

       Sopko over a span of approximately thirteen years ending in 2013, pursuant to

       twenty-seven employment contracts which the School Town entered into

       beginning in 1998. The record reveals that various members of the Board

       signed each contract. We note that Swanson, the School Town’s Director of

       Financial Operations and Treasurer, signed Accounts Payable Vouchers each

       year from 2003 to 2014. From 2000 until 2004, from 2006 until 2007, and from

       2009 until 2013, the Board allowed payments to Pfister and Sopko, and

       examined and approved the relevant Account Payable Voucher Registers –

       which included the Accounts Payable Vouchers, documents noting the specific

       amount and salary percentage of the annuity contributions to Pfister and

       Sopko’s accounts, and copies of the checks made to them. We also observe that

       the SBOA conducted six regular biennial audit examinations of the School

       Town during this period. We conclude under these circumstances that the

       causes of action brought against Pfister and Sopko for amounts paid before May

       23, 2012, five years prior to the May 23, 2017 complaint filed by the State, are

       barred by the statute of limitations.


[27]   To the extent that the State points to Robertson and argues that no claim exists

       for an action to recover public funds until the SBOA publishes its audit report

       and finds that a public official has committed malfeasance, misfeasance, or

       nonfeasance, we find Robertson distinguishable. Specifically, we note that

       Robertson involved an interlocutory appeal of a motion to dismiss under Ind.

       Trial Rule 12(B)(6) and a defendant who “assert[ed] that the . . . claims against


       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019   Page 19 of 21
       her . . . accrued . . . when the [Office of the Attorney General] received a copy

       of the preliminary report from the SBOA,” and that this Court observed in a

       footnote that she did not argue that the discovery rule did not apply to her case.

       Robertson, slip op. at 3. See id. at 3 n.6 (“Robertson also briefly asserts that the

       claims against her accrued . . . [during] the time period when she was employed

       as a bookkeeper in the Clerk’s Office. However, Robertson does not cite any

       authority to support her contention nor does she argue that the discovery rule

       does not apply.”).


[28]   To the extent that the State maintains that Ohio Farmers is liable for the policy

       amounts of Policy Nos. 1 and 2 and Policy No. 2 Renewal to cover allegations

       regarding Pfister if it were to prevail in its claims against him, and argues that

       the policies qualified as public bonds “notwithstanding the requirements of

       Indiana Code section 5-4-1-18,” we note that the cases to which the State cites

       do not stand for the proposition that a loss discovery period contained in a

       “crime insurance policy” under Ind. Code § 5-4-1-18(d) is against public policy.

       Appellant’s Brief at 27. We observe that Ind. Code § 5-4-1-18 required, during

       the relevant periods, that “[t]hose employees directed to file an individual bond

       by the fiscal body” of a city, town, or county shall file one, except for as

       provided in a relevant subsection which stated that the fiscal body of a city,

       town, county, or township “may by ordinance authorize the purchase of . . . a

       crime insurance policy,” see Ind. Code § 5-4-1-18 (1996) (subsequently amended

       by Pub. L. No. 28-2004, § 56 (eff. July 1, 2003); Pub. L. No. 146-2008, § 34 (eff.

       July 1, 2008)), and that the State does not point to the record to indicate that


       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019   Page 20 of 21
       these requirements were met. The period for Policy No. 2 Renewal expired on

       July 1, 2008, and the complaint against Ohio Farmers was brought in 2017.

       Under these circumstances, we conclude that the court did not err in granting

       summary judgment in favor of Ohio Farmers.


[29]   For the foregoing reasons, we affirm the trial court’s entry in favor of summary

       judgment of Pfister, Sopko, and Ohio Farmers.


[30]   Affirmed.


       May, J., and Mathias, J., concur.




       Court of Appeals of Indiana | Memorandum Decision 18A-PL-771 |June 24, 2019   Page 21 of 21
