                                                                              FILED
                                                                         May 22 2019, 9:01 am

                                                                              CLERK
                                                                          Indiana Supreme Court
                                                                             Court of Appeals
                                                                               and Tax Court




ATTORNEYS FOR APPELLANT                                   ATTORNEYS FOR APPELLEE
Anne K. Ricchiuto                                         BOARD OF COMMISSIONERS OF
Jane Dall Wilson                                          THE COUNTY OF FLOYD
Stephanie L. Boxell                                       Richard Fox
Faegre Baker Daniels LLP                                  Kristi L. Fox
Indianapolis, Indiana                                     Fox Law Offices
                                                          New Albany, Indiana

                                                          Bart A. Karwath
                                                          Mark J. Crandley
                                                          Barnes & Thornburg LLP
                                                          Indianapolis, Indiana



                                            IN THE
    COURT OF APPEALS OF INDIANA

City of New Albany,                                       May 22, 2019
Appellant-Intervenor/Counterclaimant,                     Court of Appeals Case No.
                                                          18A-MI-1627
        v.                                                Appeal from the Floyd Superior
                                                          Court
Board of Commissioners of the                             The Honorable Vicki Carmichael,
County of Floyd,                                          Special Judge
Appellee-Plaintiff/Counterclaim                           Trial Court Cause No.
Defendant,                                                22D02-1804-MI-598


New Albany Floyd County
Indiana Building Authority,
Appellee-Defendant/Cross-Claim
Defendant.



Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019                                  Page 1 of 14
      Bradford, Judge.



                                           Case Summary
[1]   Between 1991 and 1992 the New Albany Floyd County Indiana Building

      Authority (“the Building Authority”) issued bonds in order to finance a

      Criminal Justice Center (“the Center”). In 1992, Floyd County (“the County”),

      through its Board of Commissioners, entered into a fifteen-year lease (“the 1992

      Lease”) with the Building Authority, in which the County would lease the

      Center and the City of New Albany (“the City”) would sublease from the

      County. In 2018, approximately ten years after the 1992 Lease ended, the

      County demanded that the Building Authority deed over the title of the Center

      pursuant to a provision in the 1992 Lease. After the Building Authority refused,

      the County filed suit seeking declaratory judgment and specific performance.

      The City intervened in the suit. Following a bench trial, the trial court entered

      judgment in favor of the County. The City contends that pursuant to Indiana

      Code chapter 36-9-13, the Building Authority lacked the authority to agree to

      such a provision that voluntarily divested itself of the Center’s title. Because we

      agree that the Building Authority lacked the statutory authority to agree to such

      a provision but also conclude that the County can still exercise a purchase




      Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019          Page 2 of 14
      option in the 1992 Lease, we reverse and remand to the trial court for further

      proceedings consistent with this opinion.1



                             Facts and Procedural History
[2]   In the 1950s, the City and the County formed the Building Authority to issue

      bonds in order to finance a City-County Building. Between 1991 and 1992, the

      City and County agreed that the Building Authority would again issue bonds in

      order to finance the construction of the Center, which would be joined to the

      City-County Building. An inter-local agreement provided that the Building

      Authority would own the Center and the County would lease it pursuant to the

      terms of the 1992 Lease entered into by the County and the Building Authority.

      The inter-local agreement also stated that the City would sublease space in the

      Center from the County. The County would finance the 1992 Lease payments

      using Economic Development Income Tax (“EDIT”) revenues allocated from

      both the County’s and the City’s share of said revenues.


[3]   On September 3, 1992, the County and the Building Authority executed the

      1992 Lease. The 1992 Lease was for a term of fifteen years, beginning in

      September of 1993 when the Center was ready for partial occupancy by the City




      1
       We held oral argument in this case on April 24, 2019, at the Indiana State House in Indianapolis. We wish
      to commend counsel for the high quality of their arguments.

      Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019                               Page 3 of 14
      police and County sheriff’s departments. The 1992 Lease terms included a turn-

      over provision (“the Turn-Over Provision”) which provided that


              [i]n the event [the County] has not exercised its option to
              purchase the [Center] in accordance with Section 9 hereof and
              has not exercised its option to renew this Lease in accordance
              with Section 10 hereof, then, upon expiration of this Lease and
              upon full performance by [the County] of its obligations under
              this Lease, the [Center] shall become the absolute property of
              [the County], and, upon [the County’s] request, [the Building
              Authority] shall execute proper instruments conveying to [the
              County] all of [the Building Authority’s] title thereto.


      Appellant’s App. Vol. III p. 16–17. The 1992 Lease also included a statutory

      application provision (“the Statutory Application Provision”) which provided

      that


              [the Building Authority] was organized for the purpose of
              constructing and erecting the City County Building and leasing
              the same to [the County] under the provisions of the Indiana
              Code 36-9-13. All provisions herein contained shall be construed
              in accordance with the provisions of said Chapter, and to the
              extent of inconsistencies, if any, between the covenants and
              agreements in this Lease and provisions of said Chapter, the
              provisions of said Chapter shall be deemed to be controlling and
              binding upon [the Building Authority] and [the County].


      Id. at 18.


[4]   After the 1992 Lease expired in September of 2008, the City and the County

      continued occupying the Center, splitting the operational costs according to the

      amount of space each occupied. In 2015, the County began negotiating a multi-

      Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019          Page 4 of 14
      million-dollar renovation of the Center with the Building Authority. By 2018,

      the County requested that the Building Authority transfer title of the Center to

      the County pursuant to the Turn-Over Provision.


[5]   After the Building Authority declined to transfer title, the County filed suit on

      April 27, 2018, seeking, inter alia, declaratory judgment and specific

      performance.2 The County also moved to expedite the proceedings, which

      motion was granted. On May 18, 2018, the trial court granted the City’s motion

      to intervene. On June 15, 2018, a bench trial was held to resolve all claims,

      counterclaims, and defenses regarding the County’s request for declaratory

      judgment and specific performance. On June 19, 2018, the trial court entered

      declaratory judgment in favor of the County, concluding that the Turn-Over

      Provision in the 1992 Lease was valid pursuant to Indiana Code section 36-9-

      13-22(a)(6), making the Center the property of the County. The trial court also

      ordered that title of the Center be divested from the Building Authority and

      vested in the County pursuant to Indiana Trial Rule 70.



                                  Discussion and Decision
[6]   The City contends that the trial court erroneously entered declaratory judgment

      in favor of the County and ordered title of the Center be divested from the

      Building Authority and vested in the County pursuant to Indiana Trial Rule 70.




      2
       The County also sought attorneys’ fees, costs, and damages which were bifurcated from this current matter
      and not included in the trial court’s Indiana Trial Rule 54(B) final judgment.

      Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019                               Page 5 of 14
      “[D]eclaratory orders, judgments and decrees have the force and effect of final

      judgments and are reviewed as any other order, judgment and decree.” Ind.

      Farmers Mut. Ins. Co. v. Ellison, 679 N.E.2d 1378, 1380 (Ind. Ct. App. 1997),

      trans. denied. When a trial court, as it did here, enters judgment without making

      specific findings of fact, we may affirm that general judgment on any theory

      supported by the evidence admitted at trial. DeKalb Chiropractic Center, Inc. v.

      Bio-Testing Innovation, Inc., 678 N.E.2d 412, 414 (Ind. Ct. App. 1997). We will

      not reweigh evidence or judge the credibility of witnesses. Id. “We consider the

      evidence most favorable to the appellee and will reverse only if the evidence

      entitles the appellant to a finding in his favor as a matter of law.” Id. “We

      review matters of statutory interpretation de novo because they present pure

      questions of law.” Nicoson v. State, 938 N.E.2d 660, 663 (Ind. 2010).


                                      I. Turn-Over Provision
                              A. Indiana Code Chapter 36-9-13
[7]   The City contends that the trial court erroneously interpreted Indiana Code

      section 36-9-13-22(a)(6) to permit the Building Authority to agree to the Turn-

      Over Provision. Our goal in construing a statute is to determine and give effect

      to legislative intent. AlliedSignal, Inc. v. Ott, 785 N.E.2d 1068, 1078 (Ind. 2003).

      “To give effect to the legislature’s intent, we do not consider a statutory

      provision in isolation but rather consider the statute as a whole and interpret an

      individual provision so as to harmonize it with other sections of the

      enactment.” Id. “Where statutory provisions are in conflict, no part of a statute

      should be rendered meaningless but should be reconciled with the rest of the
      Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019            Page 6 of 14
      statute.” Id. at 1079 (quoting Robinson v. Wroblewski, 704 N.E.2d 467, 474 (Ind.

      1998)). “We generally presume that all statutory language is used intentionally,

      so that, [e]ach word should be given effect and meaning where possible and not

      treated as mere surplusage.” In re Howell, 27 N.E.3d 723, 726 (Ind. 2015)

      (internal quotations and citations omitted). Indiana Code section 36-9-13-

      22(a)(6) dictates that “the board of directors of a building authority, acting in

      the name of the authority, may acquire real or personal property by gift, devise,

      or bequest and hold, use, or dispose of that property for the purposes authorized

      by this chapter[.]” (emphasis added).


[8]   We conclude that Indiana Code chapter 36-9-13, specifically Indiana Code

      section 36-9-13-22(a)(6), does not permit the Building Authority to agree to the

      Turn-Over Provision in the 1992 Lease. We interpret Indiana Code section 36-

      9-13-22(a)(6) to permit building authorities to hold, use, or dispose only of real

      or personal property that it acquired by gift, devise, or bequest. We emphasize

      that the General Assembly’s use of the word “that” in the statute refers to

      property acquired by gift, devise, or bequest.


[9]   The County argues that the General Assembly’s use of “that” should be

      interpreted to refer to any real or personal property that is acquired by a

      building authority regardless of how it was acquired. This argument fails for

      multiple reasons. First, the County’s interpretation would make the use of the

      words “gift, devise, or bequest” mere surplusage, which we presume was not

      the General Assembly’s intent. See In re Howell, 27 N.E.3d at 726. Moreover, if

      Indiana Code section 36-9-13-22(a)(6) permitted building authorities to dispose

      Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019           Page 7 of 14
       of any real or personal property regardless of the way in which it was acquired,

       as the County suggests, it would render the other dispositional powers granted

       to building authorities in Indiana Code chapter 36-9-13 irrelevant. See Ind.

       Code § 36-9-13-25 (disposition through options to purchase); see also Ind. Code §

       36-9-13-41 (disposition through dissolution). Therefore, because it is undisputed

       that the Center was not acquired by gift, devise, or bequest, the Building

       Authority lacked the statutory authority to agree to the Turn-Over Provision.


                                B. Indiana Code Chapter 36-1-11
[10]   The County also argues that even if the Building Authority did not have the

       authority to agree to the Turn-Over Provision pursuant to Indiana Code chapter

       36-9-13, it did pursuant to Indiana Code chapter 36-1-11, which governs a

       governmental entity’s authority to dispose of real property.


               There is a strong presumption that the legislature in enacting a
               particular piece of legislation is aware of existing statutes on the
               same subject…[W]here one statute deals with a subject in general
               terms and another statute deals with a part of the same subject in
               a more specific manner, then the two should be harmonized, if
               possible; but if they are in irreconcilable conflict then the more
               detailed will prevail as to the subject matter it covers.


       Ind. Alcoholic Beverage Comm’n v. Osco Drug, Inc., 431 N.E.2d 823, 833 (Ind. Ct.

       App. 1982). Because a building authority is also a governmental entity, the

       County points to Indiana Code section 36-1-11-8 as authorization for the

       Building Authority to agree to the Turn-Over Provision. Indiana Code section

       36-1-11-8 dictates that

       Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019           Page 8 of 14
               [a] transfer or exchange of property may be made with a
               governmental entity upon terms and conditions agreed upon by
               the entities as evidenced by adoption of a substantially identical
               resolution by each entity. Such a transfer may be made for any
               amount of real property, cash, or other personal property, as
               agreed upon by the entities.


[11]   We conclude that Indiana Code chapter 36-9-13 and Indiana Code chapter 36-

       1-11 are in irreconcilable conflict in regards to the dispositional powers of

       building authorities; thus, the more specific chapter, Indiana Code chapter 36-9-

       13, must prevail. Indiana Code chapter 36-9-13 specifically details the authority

       of building authorities whereas Indiana Code chapter 36-1-11 deals more

       generally with governmental entities. If the general dispositional authority

       outlined in Indiana Code chapter 36-1-11 is held to be controlling, it would

       leave the dispositional powers outlined specifically for building authorities in

       Indiana Code chapter 36-9-13 superfluous, which would be contrary to

       precedent. See Althaus v. Evansville Courier Co., 615 N.E.2d 441, 444 (Ind. Ct.

       App. 1993) (finding where two statutes dealing with the same subject matter are

       irreconcilably conflicting, the more detailed statute prevails over the general

       statute). Moreover, both the Building Authority and the County agreed to the

       Statutory Application Provision in the 1992 Lease which mandated that

       Indiana Code chapter 36-9-13 would govern the terms of said lease. We

       construe the 1992 Lease as any other contract, which by its clear and

       unambiguous terms binds the County to the Statutory Application Provision for

       which it bargained. See Whiteco Indus., Inc. v. Nickolick, 571 N.E.2d 1337, 1339

       (Ind. Ct. App. 1991) (“A lease is to be construed as any other contract…Where

       Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019             Page 9 of 14
       no defect is claimed to have occurred during formation of the contract, its

       terms, if unambiguous, are conclusive on the question of the intentions of the

       parties.”). In summary, we conclude that the County has failed to establish that

       the Building Authority had any statutory authority to agree to the Turn-Over

       Provision.


                                          II. Purchase Option
[12]   That said, we choose not to ignore the fact that the County, as a holdover

       tenant, may still acquire title to the Center by exercising its purchase option in

       the 1992 Lease.


               When a lessee under a lease for a definite term holds over after
               the expiration of that term, the lessor has the option of treating
               the lessee as a tenant or a trespasser. In the absence of an
               agreement to the contrary, when a tenant holds over beyond the
               expiration of the lease and continues to make rental payments,
               and the lessor does not treat the tenant as a trespasser by evicting
               him, the parties are deemed to have continued the tenancy under
               the terms of the expired lease. When the original lease was for
               more than one year, the renewal lease is for a year at a time.


       Houston v. Booher, 647 N.E.2d 16, 19 (Ind. Ct. App. 1995) (internal citations

       omitted).


[13]   The 1992 Lease expired in September of 2008, and thereafter the status quo was

       maintained. Neither party claims that at any time since the expiration of the

       1992 Lease has the Building Authority attempted to evict the County. Rather,

       the County has continued to occupy its share of the Center and pay its share of


       Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019          Page 10 of 14
       the operational costs for approximately a decade. Because the County held over

       beyond the expiration of the 1992 Lease, both the Building Authority and the

       County have continued the tenancy under the terms of the 1992 Lease, which

       includes the purchase option. The purchase option states that


                [the Building Authority] hereby grants to [the County] the right
                and option, on any rental payment date prior to the expiration of
                this Lease, upon written notice to [the Building Authority], to
                purchase the [Center] at a price equal to the amount required to
                enable [the Building Authority] to liquidate by paying all
                indebtedness, including the Bonds, with accrued and unpaid
                interest to the first date on which such indebtedness may be
                redeemed and all premiums payable on the redemption thereof,
                and by paying the expenses and charges of liquidation and the
                cost of transferring the [Center].


       Appellant’s App. Vol. III p. 37. Therefore, while we remand this matter to the

       trial court so that it can vacate its order granting title to the Center in the

       County, the County may still exercise its purchase option pursuant to the 1992

       Lease.


                                                 Conclusion
[14]   Because Indiana Code chapter 36-9-13 controlled the terms of the 1992 Lease,

       the Building Authority lacked the statutory authority to agree to the Turn-Over

       Provision, making it void. We therefore remand with instructions to vacate the

       order granting title to the Center in the County. Since the expiration of the 1992

       Lease, the County has continued occupying the Center as a holdover tenant

       which means both the Building Authority and the County are deemed to have


       Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019            Page 11 of 14
       continued the tenancy under the terms of said lease. Therefore, the County has

       the option to purchase the Center pursuant to the purchase option in section

       nine of the 1992 Lease.


[15]   The judgment of the trial court is reversed and remanded with instructions for

       further proceedings consistent with this opinion.


       Bailey, J., concurs.


       Brown, J., concurs in part and dissents in part with opinion.




       Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019      Page 12 of 14
                                                   IN THE
           COURT OF APPEALS OF INDIANA

       City of New Albany,                                       Court of Appeals Case No.
                                                                 18A-MI-1627
       Appellant-Intervenor/Counterclaimant,

               v.

       Board of Commissioners of the
       County of Floyd,
       Appellee-Plaintiff/Counterclaim
       Defendant,


       New Albany Floyd County
       Indiana Building Authority,
       Appellee-Defendant/Cross-Claim
       Defendant.



       Brown, Judge, concurring in part and dissenting in part.


[16]   I concur with the majority’s conclusion in Part II that the County may still

       exercise its option to purchase the Center pursuant to the 1992 Lease.

       However, I respectfully disagree with Part I of the opinion, do not find Ind.

       Code §§ 36-9-13-22(a)(6) and 36-1-11-8 to be in irreconcilable conflict, and

       would find that in this instance the County should be able to rely on the

       authority granted in Ind. Code § 36-1-11-8. Further, Ind. Code § 36-1-11-8

       Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019                      Page 13 of 14
       contemplates a transfer or exchange of property made specifically to “a

       governmental entity,” a condition which is not present in Ind. Code § 36-9-13-

       22(a)(6).


[17]   For these reasons I respectfully concur in part and dissent in part.




       Court of Appeals of Indiana | Opinion 18A-MI-1627 | May 22, 2019       Page 14 of 14
