                                                                           FILED
                                                                       Jan 31 2017, 8:35 am

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



ATTORNEY FOR APPELLANTS                                   ATTORNEY FOR APPELLEE
R. Brock Jordan                                           Stephen C. Wheeler
Densborn Blachly LLP                                      Smith Fisher Maas Howard & Lloyd PC
Indianapolis, Indiana                                     Indianapolis, Indiana



                                             IN THE
    COURT OF APPEALS OF INDIANA

Melissa Freeman; Melissa                                  January 31, 2017
Freeman Realty, Inc.; and Realty                          Court of Appeals Case No.
Group-Freeman, LLC d/b/a                                  73A05-1606-PL-1255
Prudential Indiana Realty Group,                          Appeal from the Shelby Circuit
                                                          Court.
Appellants-Defendants,                                    The Honorable Charles D.
                                                          O’Connor, Judge.
        v.                                                Cause No. 73C01-1405-PL-14

Property-Owners Insurance
Company,
Appellee-Plaintiff.




Shepard, Senior Judge


Court of Appeals of Indiana | Memorandum Decision 73A05-1606-PL-1255 | January 31, 2017        Page 1 of 9
[1]   A prospective buyer was injured while touring a home, and he sued the listing

      real estate company for damages. The real estate company’s insurer sought a

      declaratory judgment asserting that its policy did not cover damages arising

      from the accident. The trial court granted the insurer summary judgment. We

      affirm.


                                Facts and Procedural History
[2]   Gerald Powers sustained injuries while being shown a residential property listed

      for sale by Prudential Indiana Realty Group (“Prudential”). Gerald and his

      wife (collectively “the Powerses”) filed suit for negligence, naming Prudential,

      and the agent who did the showing, and a host of other defendants.


[3]   Subsequently, Property-Owners Insurance Company, Prudential’s liability

      insurer, filed this declaratory judgment action seeking a determination that,

      based upon the “Limitation of Real Estate Operations Endorsement”

      (“Endorsement”) to the policy in question, Property-Owners has no duty to

      provide coverage, defend, or indemnify Prudential for any claims brought by
                        1
      the Powerses.




      1
       As we observed when resolving an earlier appeal in this case, besides the Powerses, “Property-Owners
      named: U.S. Bank National Association, as Trustee Under the Securitization Servicing Agreement dated as
      of July 1, 2005 Structured Asset Securities Corporation, Structured Asset Investment Loan Trust Mortgage
      Pass-Through Certificates, Series 2005-HE2; Melissa Freeman Realty, Inc.; Realty Group-Freeman, LLC
      d/b/a Prudential Indiana Realty Group; Altisource Solutions, Inc.; Altisource Fulfillment Operations, Inc.;
      Altisource; RealHome Services and Solutions, Inc., d/b/a Altisource Homes; Altisource Portfolio Solutions
      S.A.; Altisource Portfolio Solutions, Inc.; Altisource U.S. Holdings, Inc.; Altisource Holdings, LLC; Real
      Estate Servicing Solutions, LLC; Real Estate Servicing Solutions, Inc.; Altisource Portfolio Solutions
      S.A.R.L.; Ocwen Loan Servicing, LLC; Ocwen Financial Corporation; Rita Williams; Melissa Freeman;

      Court of Appeals of Indiana | Memorandum Decision 73A05-1606-PL-1255 | January 31, 2017          Page 2 of 9
[4]   The Powerses moved for judgment on the pleadings, asserting the Endorsement

      was inapplicable to the property where Gerald was injured and thus could not

      be a basis for denying coverage under Prudential’s Businessowners Policy. The

      trial court agreed and entered judgment against Property-Owners. Property-

      Owners appealed that ruling, and a panel of this Court reversed. See Property-

      Owners Ins. Co. v. Powers, et al., No. 73A05-1501-PL-2 (Ind. Ct. App. July 22,

      2015).


[5]   Property-Owners then moved for summary judgment, which the court granted

      following a hearing. Melissa Freeman, Melissa Freeman Realty, Inc., and

      Prudential (collectively “the Prudential Defendants”) now appeal.


                                                         Issue
[6]   The Prudential Defendants present one issue for our review: whether the court

      erred by granting summary judgment in favor of Property-Owners.


                                      Discussion and Decision
[7]   On appeal from a grant of summary judgment, our standard of review is similar

      to that of the trial court: whether there exists a genuine issue of material fact

      and whether the moving party is entitled to judgment as a matter of law. City of




      David Craig; Usher & Associates, Inc.; and Field Connections, LLC.” Property-Owners Ins. Co. v. Powers, et
      al., No. 73A05-1501-PL-2, slip op. p. 3 n.1 (Ind. Ct. App. July 22, 2015). Although Prudential, Melissa
      Freeman, and Melissa Freeman Realty, Inc. are the only defendants who have appeared and filed a brief in
      this appeal, pursuant to Indiana Appellate Rule 17(A), “[a] party of record in the trial court . . . shall be a
      party on appeal.”

      Court of Appeals of Indiana | Memorandum Decision 73A05-1606-PL-1255 | January 31, 2017               Page 3 of 9
      Indianapolis v. Cox, 20 N.E.3d 201 (Ind. Ct. App. 2014), trans. denied; see also Ind.

      Trial Rule 56(C). Appellate review of a summary judgment motion is limited

      to those materials designated to the trial court. Sheehan Const. Co, Inc. v. Cont’l

      Cas. Co., 938 N.E.2d 685 (Ind. 2010). All facts and reasonable inferences drawn

      from those facts are construed in favor of the non-movant. Id.


[8]   Further, the trial court’s grant of summary judgment is clothed with a

      presumption of validity, and the party who lost in the trial court has the burden

      of demonstrating that the grant of summary judgment was erroneous. Auto-

      Owners Ins. Co. v. Benko, 964 N.E.2d 886 (Ind. Ct. App. 2012), trans. denied.


[9]   At the center of this dispute is the Endorsement contained in the

      Businessowners Policy that Property-Owners issued to Prudential. It provides:


              THIS ENDORSEMENT MODIFIES INSURANCE
              PROVIDED UNDER THE BUSINESSOWNERS POLICY
              It is agreed that with respect to any real estate operation, the
              insurance provided under the Businessowners Liability Coverage
              Form applies only to “bodily injury,” “property damage,”
              “personal injury,” and “advertising injury” arising out of:
              1.       that part of a premises used by you for general office
                       purposes; and
              2.       a premises:
                       a.      which you do not own, operate, rent or manage;
                       b.      which is not in your care, custody or control; or
                       c.      for which you do not act as an agent for rent
                               collection or in a supervisory capacity;
                       if such premises is listed with you for sale or rental.
              All other terms and conditions of the policy apply.
      Court of Appeals of Indiana | Memorandum Decision 73A05-1606-PL-1255 | January 31, 2017   Page 4 of 9
       Appellants’ App. Vol. 3, p. 175.


[10]   In addition, Prudential broker-salesperson Rita Williams had signed a listing

       agreement for the property where Gerald Powers was injured. It included the

       following provision:

               3. Broker agrees to assume the care, custody and management of
               the property, including but not limited to performing the
               following:
                        A. Input listing in appropriate MLS;
                        B. Install signage;
                        C. Answer calls/emails from buyers/agents;
                        D. Conduct open houses when necessary;
                        E. To inspect the property at least once each week and
                        take reasonable and prudent action to prevent any damage
                        to the property including, but not limited to, damage
                        caused by fire, vandalism, and weather conditions, and
                        notify Seller immediately by telephone in the event of any
                        emergency, code violation or damage related to the
                        property; and
                        F. To complete and submit to Altisource Homes, on a
                        monthly basis, a Property Status Report, in the form
                        attached hereto. Such report shall include information as
                        to the classified and display advertising conducted by
                        Broker, other sales promotions and results, as well as
                        showings to prospective purchasers and their comments,
                        new comp, sales and listings and Broker’s
                        recommendations on marketing strategy. Altisource
                        Homes shall in turn submit the Property Status Report to
                        Seller.
       Id. at 99-100.

       Court of Appeals of Indiana | Memorandum Decision 73A05-1606-PL-1255 | January 31, 2017   Page 5 of 9
[11]   The Prudential Defendants first contend the court erred by determining that

       Prudential’s Businessowners Policy does not afford coverage to Prudential in

       this case because the Endorsement is ambiguous, specifically the phrase “care,

       custody or control” in section 2.b.


[12]   The interpretation of an insurance policy is generally a question of law

       appropriate for summary judgment. Liberty Mut. Ins. Co. v. Michigan Mut. Ins.

       Co., 891 N.E.2d 99 (Ind. Ct. App. 2008). The terms of an insurance policy are

       interpreted using the same rules of interpretation applied to other contracts.

       Benko, 964 N.E.2d 886. If the language of the policy is clear and unambiguous,

       it must be given its plain and ordinary meaning. Zeller v. AAA Ins. Co., 40

       N.E.3d 958 (Ind. Ct. App. 2015). Conversely, where an ambiguity exists, the

       policy is construed strictly against the insurer, and the terms of the policy are

       interpreted from the perspective of an ordinary policyholder. Benko, 964

       N.E.2d 886. An ambiguity is not necessarily established simply because a

       controversy exists and the parties assert contrary interpretations of the terms of

       the policy. Haag v. Castro, 959 N.E.2d 819 (Ind. 2012).


[13]   Although the Prudential Defendants claim that the Endorsement is ambiguous

       because it is “silent regarding whether actual management or control is

       required, or alternatively whether a contractual obligation is sufficient,” we find

       the language to be straightforward. Appellants’ Br. p. 11. The Endorsement

       requires only that the insured have the care, custody or control of the premises;

       it makes no statement about whether one actually fulfills its obligation of care,

       custody, or control, or how one acquires that care, custody, or control. Thus,

       Court of Appeals of Indiana | Memorandum Decision 73A05-1606-PL-1255 | January 31, 2017   Page 6 of 9
       we see nothing in the terms of the Endorsement to indicate that the phrase

       “care, custody or control” is meant to have anything other than a plain and

       ordinary meaning.


[14]   In discerning the meaning of “care, custody or control” as used in an insurance

       policy, Justice David observed for our Supreme Court that the dictionary

       definitions seem plain enough:


               Webster’s defines “care” in this context as “[t]he function of
               watching, guarding, or overseeing.” Webster’s II New College
               Dictionary 168 (1995). “Custody” is defined as “[t]he act or right
               of guarding, esp. such a right granted by a court.” Id. at 280.
               “Control” means “[t]o exercise authority or influence over” or
               “[t]o hold in restraint.” Id. at 246. Black’s Law Dictionary is
               similar, defining “care” as “[u]nder the law of negligence or of
               obligations, the conduct demanded of a person in a given
               situation,” Black’s Law Dictionary 240 (9th ed. 2009), defining
               “custody” as “[t]he care and control of a thing or person for
               inspection, preservation, or security,” id. at 441, and “control” as
               “[t]o exercise power or influence over,” id. at 378.
       Holiday Hosp. Franchising, Inc. v. AMCO Ins. Co., 983 N.E.2d 574, 579 (Ind.

       2013). The Court found these definitions to be reasonable and noted that not

       all three terms needed to be satisfied for coverage to be excluded because the

       policy listed the terms in the disjunctive. See id.




       Court of Appeals of Indiana | Memorandum Decision 73A05-1606-PL-1255 | January 31, 2017   Page 7 of 9
[15]   Here, by virtue of the terms of the listing contract signed by Williams, the
                                                                                                               2
       residential property was in the “care,” “custody,” or “control” of Prudential.

       Prudential, through Williams, agreed and was required to inspect the property

       at least once a week and to take action to prevent damage to the property.

       Additionally, Prudential was to notify the seller immediately in the event of any

       emergency, code violation, or damage. We see no ambiguity in the

       Endorsement.


[16]   The Prudential Defendants also argue the court erred by granting summary

       judgment because Prudential’s obligation under the listing contract was

       modified by its conduct such that it did not actually exercise care, custody, and

       control over the listed property. Essentially, the Prudential Defendants claim

       that Prudential agreed to and is contractually obligated to the care, custody, and

       control of the property under the listing contract, which would ordinarily mean

       no coverage under Prudential’s insurance policy, but because it did not fulfill its

       contractual obligations under the listing contract, it is still covered under the

       insurance policy (i.e., Property-Owners will have to pay for Prudential’s failure

       to fulfill its obligations).


[17]   Property-Owners says this argument is waived because the Prudential

       Defendants did not raise it in the trial court. Our review of the materials

       available on appeal discloses that the Prudential Defendants neither presented



       2
        Property-Owners alleges and the Prudential Defendants do not dispute that Prudential required all listings
       of its broker-salespersons to be the property of Prudential and be listed in Prudential’s name.

       Court of Appeals of Indiana | Memorandum Decision 73A05-1606-PL-1255 | January 31, 2017           Page 8 of 9
       this argument in their brief to the trial court nor raised it at the summary

       judgment hearing. Thus, as the Prudential Defendants have introduced this

       argument for the first time on appeal, the argument is waived. See I.A.E., Inc. v.

       Hall, 49 N.E.3d 138 (Ind. Ct. App. 2015) (stating that, in general, party waives

       appellate review of issue or argument that was not presented to trial court),

       trans. denied.


                                                Conclusion
[18]   The trial court did not err by granting summary judgment for Property-Owners.


[19]   Affirmed.


       Crone, J., and Altice, J., concur.




       Court of Appeals of Indiana | Memorandum Decision 73A05-1606-PL-1255 | January 31, 2017   Page 9 of 9
