ATTORNEY FOR APPELLANT                                    ATTORNEYS FOR APPELLEE
FIELDVIEW PROPERTIES, LLC                                 Megan L. Craig
AND KAREN RUSIN                                           John R. Craig
David J. Tipton                                           Craig, Craig & Maroc, LLC
Densborn Blachly, LLP                                     Crown Point, Indiana
Indianapolis, Indiana
ATTORNEY FOR APPELLANT EAST
POINT BUSINESS PARK, LLC
                                                                              Dec 31 2015, 9:28 am
Geoffrey G. Giorgi
Giorgi & Bebekoski, LLC
Merillville, Indiana



                                           IN THE
    COURT OF APPEALS OF INDIANA

East Point Business Park, LLC,                            December 31, 2015
Fieldview Properties, LLC, and                            Court of Appeals Case No.
Karen Rusin,                                              45A05-1412-MF-584
Appellants-Defendants,                                    Appeal from the Lake Superior
                                                          Court
        v.                                                The Honorable John M. Sedia,
                                                          Judge
Private Real Estate Holdings,                             Trial Court Cause No.
LLC,                                                      45D01-1102-MF-40
Appellee-Plaintiff.



Mathias, Judge.




Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015             Page 1 of 33
[1]   Appellants-Defendants East Point Business Park, LLC (“East Point”),

      Fieldview Properties, LLC, (“Fieldview”) and Karen Rusin (“Rusin”)

      (collectively “the Defendants”) challenge the Lake Superior Court’s grant of

      summary judgment in favor of Appellee-Plaintiff Private Real Estate Holdings,

      LLC (“PREH”), in PREH’s foreclosure action against the Defendants.


[2]   We affirm.

                                     Facts and Procedural History

[3]   East Point is a limited liability company formed for the purpose of acquiring a

      124-acre parcel of real estate (“the Property”) in Crown Point, Indiana, and

      developing a business park for lease and eventual sale. The members of East

      Point are Fieldview and another group called Investors of East Point, LLC

      (“IEP”). IEP owns a 70% interest in East Point and Fieldview a 30% interest.

      While Rusin is the sole owner of Fieldview, IEP is owned by: Michael Barrett

      (“Barrett), who owns a 50% interest; Sheridan Investors, LLC (“Sheridan”),

      which owns a 25% interest; and Lake Charles Investors, LLC (“Lake Charles”),

      which owns the remaining 25% interest. Sheridan is itself owned by Don and

      Pat Manhard, and Lake Charles by Pete and Lynn Manhard. Accordingly,

      Barrett owns a 35% interest in East Point, and Sheridan and Lake Charles each

      own a 17.5% interest.


[4]   On May 1, 2006, East Point purchased the Property from Fieldview for a

      purchase price of $4.9 million. The purchase was financed by loans from

      Private-Bank (“the Bank”), an Illinois bank based in Chicago. East Point


      Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 2 of 33
      borrowed $2.2 million, and Fieldview borrowed $2.7 million. The loans were

      secured by promissory notes and mortgages on the Property. East Point’s

      mortgage was listed as a primary mortgage, and Fieldview’s mortgage was

      listed as a secondary mortgage. In addition, Rusin, Barrett, and the Manhards

      all personally guaranteed the loan to East Point.


[5]   During the development of the Property, East Point received three loan

      renewals from the Bank, each extending the maturity date of the East Point

      loan. The first renewal extended the maturity date to March 15, 2009; the

      second renewal extended the maturity date to March 15, 2010; and the third

      renewal extended the maturity date to September 15, 2010.1 This renewal

      process also involved two other loans involving the Manhards, and the Bank

      desired to keep the Manhards as clients.


[6]   East Point’s loan had an “interest reserve” feature that allowed East Point to

      borrow from the loan commitment to pay the interest due on the loan, thereby

      increasing the balance of the loan.2 East Point did this to fund development



      1
       The last of these renewals occurred after the second-extended maturity date of March 15, 2010, but the
      Bank nevertheless considered the loan as not being in default.
      2
          The applicable provision of the loan agreement provides:

                2.3 Use of Loan Proceeds. Borrower represents and warrants to Bank that Borrower shall
                use the proceeds of the Loan made pursuant to this Agreement and the Loan Documents
                solely as follows:
                (a) To acquire the Property and pay real estate taxes and insurance premiums with respect
                thereto;
                (b) To provide general and administrative costs of the Project and for obtaining this Loan,
                which such Loan costs shall include, without limitation, bank fees, origination fees, title
                fees and attorneys’ fees; and

      Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015                        Page 3 of 33
      costs and to pay Fieldview’s two yearly loan payments of $32,500. Although

      the East Point loan was not formally tied to other loans via cross-

      collateralization, the Bank viewed the East Point loan together with the loans to

      Barrett and the Manhards for purposes of determining the Bank’s aggregate

      credit exposure.


[7]   The Bank funded East Point’s first draw request in 2009, and East Point used

      the money from this draw to make three $32,500 payments on the Fieldview

      loans. The Bank also funded two other draw requests, the last being a $33,000

      draw to pay the March 2010 Fieldview mortgage payment, which was funded

      on March 15, 2010, the maturity date of the East Point loan, which was later

      extended to September 15, 2010, as noted above.


[8]   In July 2010, the Bank and East Point discussed the loan. East Point wanted the

      Bank to extend the maturity date once again. The Bank proposed that $500,000

      of debt from one of the other Manhard loans be transferred to the East Point

      loan, the reason being that the loan-to-value ratio of one of the Manhard loans

      was too high, whereas the loan-to-value ratio of the East Point loan was within

      the Bank’s underwriting criteria. One of East Point’s agents, Tom Sherman




              (c) To provide a source of payment of interest on the Loan. In this regard, Borrower shall
              establish an “interest reserve” in the amount of Two Hundred Thousand and no/100
              Dollars ($200,000.00) by reserving and segregating $200,000 of the Non- Revolving
              Facility for the sole purpose of the payment of interest, which interest reserve may be
              utilized, and drawn on, by Borrower to pay monthly interest due from Borrower to Bank
              pursuant to the Note.
      Appellants’ App. p. 336.

      Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015                      Page 4 of 33
       (“Sherman”), told the Bank that shifting this debt was a problem because the

       East Point loan involved Barrett and Rusin in addition to the Manhards. The

       Bank responded that it had issues with a long-term loan renewal on the East

       Point loan because Barrett had an unrelated loan on property with an

       outstanding tax payment.


[9]    On September 8, 2010, East Point submitted another draw request to the Bank

       for $32,500 to pay the Fieldview loan payment. Although the loan had not yet

       matured, and funds were available in the loan commitment, the Bank did not

       fund the draw request, nor did the Bank respond to the request or provide East

       Point with an explanation of the failure to fund the requested draw.

[10]   On September 10, 2010, five days before the maturity date of the East Point

       loan, Sherman and Tom Manhard met with the Bank’s loan officers. The East

       Point offer was modified to include payment of Barrett’s outstanding property

       taxes. East Point’s proposal also included transferring $300,000 of debt to East

       Point with an eighteen-month extension of the maturity date with an option for

       an additional eighteen-month extension. It also proposed eliminating the

       interest reserve and draw feature, thereby requiring East Point to make its

       payments from funds other than the loan itself.


[11]   East Point contends that the Bank agreed to this renewal, as evidenced by the

       Bank’s asset report, which states: “Pape and Ahern [the Bank’s agents] met

       with [the] Manhards on 09/10/10 and they have agreed to [the] plan above and




       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 5 of 33
       bank needs to formalize the proposal above.” Appellants’ App. p. 1350.

       However, the alleged renewal agreement was never reduced to writing.

[12]   On November 29, 2010, the Bank made an internal report indicating that it was

       “scrapping” the proposed East Point loan renewal. On December 10, 2010, the

       Bank sent a demand letter to East Point and its guarantors, declaring that the

       loan was in default due to the maturation date having passed, and demanded

       payment of the balance of the loan within ten days. The Bank subsequently

       presented a pre-negotiation agreement to East Point and its guarantors, which

       contained a provision stating, “Borrower acknowledges and agrees that Lender

       is not in default under any of Lender’s obligations contained in the Loan

       Documents,” and “Borrower acknowledges and agrees that Lender has . . .

       performed all of Lender’s obligations and agreements . . . that all actions taken

       to date by Lender . . . have been reasonable . . . in good faith, and within

       lender’s rights under the loan documents and applicable law.” Appellants’ App.

       pp. 1216, 1218. East Point and its guarantors refused to sign this agreement and

       sent a revised version of the agreement to the Bank. The Bank never signed the

       revised agreement and filed suit against East Point and its guarantors on

       February 15, 2011.


[13]   After filing suit, the Bank made a joint forbearance proposal to East Point and

       two of the other Manhard loans. The Bank’s proposal called for cross-defaults

       among the three loans and their guarantors, and called for Fieldview to assign

       its mortgage to the Bank as security for Rusin’s guarantee of the East Point

       loan. The borrowers rejected the Bank’s proposals.

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 6 of 33
[14]   The Bank subsequently settled with the Manhards and Barrett under

       agreements that provided that the Manhards and Barrett would pay $350,000 to

       settle their liability with the Bank as guarantors of the East Point loan. One

       provision of the settlement agreements provided that the Manhards and Barrett,

       or any entity they controlled:


               Shall not, directly or indirectly, provide any loans, capital
               contributions or financial assistance to East Point, Fieldview or
               IEP; contest, delay, hinder, interfere with or otherwise affect the
               prosecution of the Foreclosure Action; provide any assistance to
               East Point in contesting, delaying or hindering the Foreclosure
               Action; consent to, approve or acquiesce in any amendment to
               the Operating Agreement of East Point or IEP which is in any
               manner adverse to the Bank; and sell, assign, transfer, encumber
               or consent to any transfer of any interest in East Point or IEP.


       Appellants’ App. pp. 1223, 1362, 1371. After signing the settlement agreements,

       Barrett and the Manhards notified Rusin that they were resigning their

       management roles at East Point. On September 26, 2011, the Bank dismissed

       Barrett and the Manhards from the suit. The remaining defendants were East

       Point, Fieldview, and Rusin. Since Rusin was the sole owner of Fieldview, and

       Fieldview the only non-settling owner of East Point, the remaining defendant is

       effectively Rusin. Fieldview filed a counterclaim on May 18, 2011, alleging

       tortious interference with the contract and inducement of breach of contract,

       breach of contract, and abuse of process. Fieldview also sought to foreclose on

       its secondary mortgage on the Property.




       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 7 of 33
[15]   On September 27, 2012, the Bank sold the East Point loan to PREH, who was

       substituted as the plaintiff. On July 20, 2013, PREH filed a motion for summary

       judgment. The trial court granted the Defendants several extensions of time to

       file a reply to PREH’s motion for summary judgment. The last of the trial

       court’s orders on the subject provided that “Defendants’ Response to the

       Motion for Summary Judgment shall be due three (3) days after the conclusion

       of the deposition of Private Bank and Trust, Co., unless otherwise agreed by the

       Parties or Ordered by the Court.” Appellants’ App. pp. 636-37. The

       Defendants’ counsel then filed a Notice to the Court of Agreed Briefing

       Schedule on Motion for Summary Judgment. Id. at 641. In this notice, the

       Defendants stated that the parties had agreed that the Defendants’ answer brief

       to the motion for summary judgment would be due on August 22, 2014, and

       that PREH’s reply would be due on August 29, 2014.

[16]   On August 22, 2014, the Defendants filed a joint brief responding to PREH’s

       motion for summary judgment. However, the brief was not accompanied by

       any affidavits or other designated evidence. Instead, the Defendants did not file

       their designated evidence until December 24, 2014. The Defendants also filed a

       motion to strike the affidavit of PREH’s principal Arshad Malik (“Malik”) as

       being contrary to his subsequent deposition testimony. PREH filed a reply brief

       on August 29, 2014, in accordance to the timeline set forth in the agreed

       briefing schedule. Accompanying PREH’s reply was a motion to strike the

       Defendants’ exhibits.




       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 8 of 33
[17]   The trial court held a summary judgment hearing on September 3, 2014. At the

       conclusion of the hearing, the trial court took the matter under advisement and

       requested that the parties submit proposed findings and conclusions, which the

       parties subsequently did. On October 24, 2014, counsel for Fieldview and Rusin

       filed a Declaration of Technical Difficulty and Delay in filing Summary

       Judgment Motion Evidence. On November 20, 2014, the trial court granted

       PREH’s motion for summary judgment and entered a decree of foreclosure.

       The Defendants now appeal.


                              Summary Judgment Standard of Review

[18]   Our standard for reviewing a trial court’s order granting a motion for summary

       judgment is well settled:


               A trial court should grant a motion for summary judgment only
               when the evidence shows that there is no genuine issue as to any
               material fact and that the moving party is entitled to a judgment
               as a matter of law. The trial court’s grant of a motion for
               summary judgment comes to us cloaked with a presumption of
               validity. An appellate court reviewing a trial court summary
               judgment ruling likewise construes all facts and reasonable
               inferences in favor of the non-moving party and determines
               whether the moving party has shown from the designated
               evidentiary matter that there is no genuine issue as to any
               material fact and that it is entitled to judgment as a matter of law.
               But a de novo standard of review applies where the dispute is one
               of law rather than fact. We examine only those materials
               designated to the trial court on the motion for summary
               judgment. Our standard of review is not altered by the fact that
               the parties filed cross motions for summary judgment. Here, the
               trial court made findings of fact and conclusions of law in
               support of its entry of summary judgment. Although we are not

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 9 of 33
               bound by the trial court’s findings and conclusions, they aid our
               review by providing reasons for the trial court’s decision. We
               must affirm the trial court’s entry of summary judgment if it can
               be sustained on any theory or basis in the record.


       Altevogt v. Brand, 963 N.E.2d 1146, 1150 (Ind. Ct. App. 2012) (citations and

       internal quotations omitted).


                 I. Did the Defendants Timely File Designated Evidence?

[19]   Before addressing the merits of the Defendants’ arguments, we turn first to

       PREH’s claim that the trial court should not have considered any of the

       Defendants’ designated evidence because the evidence was not timely filed.

       PREH claims that the Defendants’ response to its motion for summary

       judgment was due no later than May 30, 2014, which was the date listed in the

       trial court’s order entered on April 25, 2014, in which the court accepted the

       parties’ agreed motion to alter the due date of the Defendants’ response to

       summary judgment. PREH argues that this was the last extension of time

       requested by the Defendants.


[20]   Our review of the record, however, reveals that the trial court entered several

       subsequent orders extending the date on which the Defendants’ response to

       PREH’s motion for summary judgment was due. Specifically, after PREH

       moved to continue the summary judgment hearing, on May 21, 2014, the

       Defendants filed an agreed motion requesting that the Defendants’ summary

       judgment response(s) be due no later than June 30, 2014. The trial court granted




       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 10 of 33
       this motion two days later, giving the Defendants until June 30, 2014, to file

       their materials in response to PREH’s summary judgment motion.

[21]   Then again, on June 26, 2014, the Defendants filed another agreed motion,

       with the consent of opposing counsel, requesting that the trial court “alter the

       summary judgment motion response date to July 17, 2014[.]” Appellants’ App.

       p. 627. The trial court granted this motion the following day, ordering that:

       “The time for Defendants' response to the summary judgment motion filed by

       Private Real Estate Holdings LLC (“PREH’) is changed to July 17,2014[.]” Id.

       at 629-30.


[22]   Then, on July 16, 2014, the Defendants filed yet another agreed motion seeking

       to extend the deadline for filing their response to PREH’s motion for summary

       judgment, this time to July 23, 2014. The trial court granted this motion to

       following day, ordering: “the time for Defendants’ response to the summary

       judgment motion filed by [PREH] is changed to July 23, 2014[.]” Id. at 634.


[23]   That same day, July 17, 2014, however, the trial court issued an Agreed Order

       on Emergency Motion for Trial Rule 26(C)(2) Protective Order, which

       provided in relevant part:

               IT IS ORDERED THAT the 30(b)(6) deposition of Third Party
               Defendant, PrivateBank and Trust Co. shall not last longer than
               seven (7) hours on any one day. Should the Defendant,
               Fieldview Properties, LLC and Karen Rusin need additional time
               to take the deposition of PrivateBank and Trust Co., then the
               parties will agree to continue the deposition at the next earliest
               date available to all parties. Furthermore, the parties agree that

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 11 of 33
                should the deposition of PrivateBank and Trust Co., need to
                proceed onto a second day, then Defendants Response to the
                Motion for Summary Judgment shall be due three (3) days after
                the conclusion of the deposition of PrivateBank and Trust Co.,
                unless otherwise agreed by the Parties or Ordered by the Court.


       Id. at 636-37 (emphasis added).


[24]   On August 18, 2014, the Defendants filed a Notice to the Court of Agreed

       Briefing Schedule on Motion for Summary Judgment, which stated:

                The parties, by and through the undersigned, David J. Tipton,
                counsel for Defendants Fieldview Properties, LLC and Karen
                Rusin, hereby notify the Court that counsel for all parties have
                agreed on a briefing schedule concerning the pending summary
                judgment motion filed by the substitute plaintiff [PREH] now
                scheduled for hearing on September 3, 2014 at 1:00 p.m., as
                follows:
                -Defendants’ answer brief due date: Friday, August 22, 2014;
                -[PREH] reply brief due date: Friday, August 29, 2014.
                The parties have engaged in at least seven (7) different days of
                depositions over the last two (2) months in connection with the
                summary judgment motion and this case. Unless the Court
                disagrees and orders a different briefing schedule, the parties
                respectfully request that the Court accept this agreed briefing
                schedule as if ordered by the Court.


       Appellants’ App. pp. 641-42. Based upon our review of the record, however, it

       appears that the trial court never entered an order formally accepting this

       briefing schedule. Still, the trial court’s previous order of July 17 allowed the

       parties to alter the deadline by agreement of the parties or as ordered by the

       court.
       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 12 of 33
[25]   Accordingly, the Defendants filed their brief in response to PREH’s motion for

       summary judgment on August 22, 2014, as set forth in the agreed motion. As

       noted above, however, they did not file their designated evidence until August

       24, 2014, two days past the deadline. Thus, even granting the Defendants the

       grace of an extended August 22 deadline, they did not file their designated

       evidence in time.

[26]   At the September 3, 2014, summary judgment hearing, counsel for the

       Defendants explained the delay by claiming that he had experienced technical

       difficulties with the Lake County e-filing system that prevented him from filing

       the designated materials with the court on August 22. PREH responded by

       informing the court that, if the Defendants’ counsel did have technical difficulty

       with the e-filing system, then he was required to have filed a notice of manual

       filing or declaration pursuant to local court rules. The rule at issue provides in

       relevant part:


               E. Conventional Filing of Documents. A conventionally filed
               document is one presented to the clerk or to a party in paper or
               other non-electronic, tangible format. Unless specifically
               authorized by the court, only the following documents may be
               filed conventionally and not electronically:

                   (1) Exhibits and Other Documents That Cannot Be Converted to a
                       Legible Electronic Form, Such as Videotapes, X-Rays, and
                       Similar Materials. Whenever possible, the filer is
                       responsible for converting filings to an electronic form. If
                       electronic filing is not possible, the filer shall
                       electronically file a Notice of Manual Filing as a
                       notation to be placed on the CCS that filings are being
                       held in the clerk’s office in paper. The filer shall serve
       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015    Page 13 of 33
                        the Notice of Manual Filing and the documents in
                        accordance with the Indiana Rules of Civil Procedure
                        and applicable Local Rule(s); and shall file a certificate
                        of service. A Notice of Manual Filing form is appended
                        hereto as Form 2; a Certificate of Service form is appended
                        hereto as Form 3.
                                                         ***

                   J. Technical Failures. If a registered user is unable to file a
                   document in a timely manner due to technical difficulties in
                   the LCOD [Lake County Online Docket], the registered user
                   must file a document with the court as soon as possible
                   notifying the court of the inability to file the document. A
                   sample document titled Declaration that Party was Unable to
                   File in a Timely Manner Due to Technical Difficulties is
                   attached hereto as Form 4. Delayed filings shall be rejected
                   unless accompanied by the declaration attesting to the
                   filer's failed attempts to file electronically at least two
                   times, separated by at least one hour, after noon on each
                   day of delay due to such technical failure.


       Lake County Rule of Civil Procedure 17(E)(1), (J) (bold emphasis added).

[27]   Still, it was not until October 24, 2014, over two months after the belated e-

       filing, that counsel for Fieldview and Rusin filed a Declaration of Technical

       Difficulty and Delay in filing Summary Judgment Motion Evidence. In this

       motion, counsel asserted:

               On the due date for the opposing papers to the summary
               judgment motion filed by PRE[H], August 22, 2014, in the
               evening, I filed the joint brief of Defendants opposing the
               summary judgment motion, Defendants’ designation of Evidence
               and the Affidavit of Karen Rusin. At approximately 10:00 p.m.
               Eastern Time, I began attempting to upload the Designated
       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 14 of 33
               Evidence consisting of deposition transcripts and exhibits. The
               format was pdf, but it was in a bundled format (as received from
               the court reporter). After numerous tries to upload these pdf
               documents, ending at approximately 11:00 p.m. Eastern Time, it
               was apparent to me that uploading the Designated Evidence in
               their current format was not working and would not work. I
               came back over the weekend and unbundled the transcripts and
               exhibits and was successful in uploading all of the Designated
               Evidence. All of these events occurred outside of regular business
               hours and it was not possible to substitute the filing manually or
               ask for help from the clerk’s office.


               I informed the Court and opposing counsel of these events in
               open Court at the September 3, 2014 hearing on the summary
               judgment motion. I do not believe that any party was prejudiced
               because the attorney for PRE[H] was already in receipt of the
               Designated Evidence (they had copies of all deposition
               transcripts and exhibits before August 22, 2014), and all citations
               to the Designated Evidence in the brief was accessible from those
               materials by the attorneys for PRE[H] in preparation of their
               reply brief. The occasioned delay was a portion of the weekend
               only.


       Appellants’ App. p. 1492.


[28]   We have no reason to doubt that the Defendants’ counsel experienced technical

       difficulty with the e-filing system, and we sympathize with counsel in such a

       situation. Indeed, as e-filing is implemented throughout Indiana, we expect that

       in some rare instances, technical issues might prevent or delay an electronic

       filing. Indeed, Trial Rule 86 contemplates and provides for such occurrences,

       with the expectation that an appropriate and timely record will be made of the

       difficulties encountered, so that courts can consider and rule on the effect of

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 15 of 33
       such difficulties. In similar fashion, we now look to the clear language of the

       Local Rule 16, which clearly anticipates such situations and sets forth the steps

       to follow in the case of such technical difficulties.


[29]   Pursuant to the applicable rule, counsel was required to file with the trial court

       as soon as possible a document notifying the court of his inability to electronically

       file the document. Here, counsel simply informed the trial court of the

       difficulties at the summary judgment hearing and did not file any such

       notification with the court until sixty-one days after the date the designated

       materials were due. We cannot say this constitutes “as soon as possible,” nor

       did counsel’s notification to the court indicate that he unsuccessfully attempted

       to file electronically at least two times, separated by at least one hour, after

       noon on each day of the delay, as required by the rule. In absence of

       compliance with the provisions of this rule, the trial court was required to reject

       the delayed filings. See Lake County Rule of Civil Proc. 16(J).


[30]   Because the Defendants’ designated materials were untimely filed, the trial

       court could not consider them. Indiana Trial Rule 56(C) provides that a party

       opposing a summary judgment motion has thirty days after service of the

       motion to serve a response and any opposing affidavits. “For cause found,” a

       trial court is authorized to “alter any time limit set forth in this rule upon

       motion made within the applicable time limit.” Ind. Trial Rule 56(1). Our

       supreme court has described this as a “bright line rule” and explained:


               [W]here a nonmoving party fails to respond within thirty days by
               either (1) filing affidavits showing issues of material fact, (2) filing
       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 16 of 33
               his own affidavit under Rule 56(F) indicating why the facts
               necessary to justify his opposition are unavailable, or (3)
               requesting an extension of time in which to file his response
               under 56(1), the trial court lacks discretion to permit the party to
               thereafter file a response. In other words, a trial court may exercise
               discretion and alter time limits under 56(1) only if the nonmoving party
               has responded or sought an extension of time within thirty days from the
               date the moving party filed for summary judgment.


       HomEq Servicing Corp. v. Baker, 883 N.E.2d 95, 98 (Ind. 2008) (emphasis added);

       accord Handy v. P.C. Bldg. Materials, Inc., 22 N.E.3d 603, 606-07 (Ind. Ct. App.

       2014), trans. denied.


[31]   This rule applies to materials filed belatedly after an extension of time has

       already been granted by the trial court. That is, “not only must a nonmovant

       file a response or request for a continuance during the initial thirty-day period,

       but the nonmovant ‘must also file a response, file an affidavit pursuant to T.R.

       56(F), or show cause for alteration of time pursuant to T.R. 56(I) during any

       additional period granted by the trial court.’” Miller v. Yedlowski, 916 N.E.2d

       246, 251 (Ind. Ct. App. 2009) (citing Thayer v. Gohil, 740 N.E.2d 1266, 1269

       (Ind. Ct. App. 2001)). The reason for this rule was explained in Miller:


               The rationale behind the rule requiring a nonmoving party to
               respond to a motion for summary judgment—by either filing a
               response, requesting a continuance under Trial Rule 56(I), or
               filing an affidavit under Trial Rule 56(F)—within thirty days does
               not vanish because the trial court has happened to grant one
               extension of time. That is, the nonmoving party should not be
               rewarded and relieved from the restriction of responding within the time
               limit set by the court because he or she has had the good fortune of one
               enlargement of time. Therefore, any response, including a
       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015    Page 17 of 33
               subsequent motion for enlargement of time, must be made within
               the additional period granted by the trial court. The rationale of
               HomEq and the cases leading up to it are not restricted to the
               initial thirty-day period following the filing of a motion for
               summary judgment.


       Miller, 916 N.E.2d at 251-52 (emphasis added).


[32]   Accordingly, once the already-extended deadline had passed, the trial court had

       no discretion to further extend it, and the designated materials submitted by the

       Defendants should not have been considered. Likewise, we will not consider

       these belatedly filed materials on appeal.


              II. Should the Trial Court Have Stricken Certain Affidavits?

[33]   The Defendants first argue that the trial court should have stricken the affidavit

       of PREH’s principal Malik. They claim that the affidavit conflicts with Malik’s

       subsequent deposition testimony. To be sure, Indiana courts have long held that

       a party who has been examined at length during a deposition cannot create a

       genuine issue of material fact simply by submitting an affidavit contradicting his

       own prior testimony. Brown v. Buchmeier, 994 N.E.2d 291, 296 (Ind. Ct. App.

       2013) (citing Gaboury v. Ireland Rd. Grace Brethren, Inc., 446 N.E.2d 1310, 1314

       (Ind. 1983)). Otherwise, the utility of summary judgment would be greatly

       diminished as a procedure for screening out sham issues of fact. Id.


[34]   Here, Malik submitted an affidavit in which he averred that he kept the books

       and records of PREH and that these books and records were kept in the

       ordinary course of PREH’s business. Appellants’ App. p. 505. In his subsequent

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 18 of 33
       deposition testimony, however, Malik testified that he had never actually seen

       the documents related to PREH and East Point, that he did not look at the

       documents before signing his affidavit, and that his attorney actually kept the

       loan records. Id. at 651-54. Accordingly, Malik did not submit an affidavit

       contrary to his prior deposition testimony. Instead, his subsequent deposition

       testimony was inconsistent with his earlier affidavit. This does not suggest that

       Malik was attempting to manufacture a sham issue of fact. Instead, it appears

       that the Defendants’ counsel was simply able to effectively examine Malik at

       the deposition and impeach his affidavit. Under these circumstances, the trial

       court did not abuse its discretion by denying the motion to strike Malik’s

       affidavit.

[35]   The Defendants also complain that the affidavit submitted by Bank manager

       Christopher Leff (“Leff”) contained improper conclusory statements that should

       have been disregarded. Specifically, they refer to Paragraph 16 of Leff’s

       affidavit, in which he avers that “[The Bank] (as predecessor in interest) has

       performed all conditions precedent to Plaintiff’s rights to enforce the

       agreements with East Point under the Loan Documents.” Appellants’ App. p.

       501.

[36]   As explained in Gast v. Hall:


               Indiana Trial Rule 56(E) provides, in pertinent part: “Supporting
               and opposing affidavits shall be made on personal knowledge,
               shall set forth such facts as would be admissible in evidence, and
               shall show affirmatively that the affiant is competent to testify to
               the matters stated therein.” Discussing that rule, our Supreme

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 19 of 33
                Court has stated, “Conclusory statements not admissible at trial
                should be disregarded when determining whether to grant or
                deny a summary judgment motion.”


       858 N.E.2d 154, 162 (Ind. Ct. App. 2006) (quoting Paramo v. Edwards, 563

       N.E.2d 595, 600 (Ind. 1990)).


[37]   The statement in Leff’s affidavit that the Bank had performed all conditions

       precedent to enforce the note and mortgage was, by itself, conclusory.

       However, other evidence designated by PREH, including the loan

       documentation itself, established that the Bank met the conditions for it to

       enforce the note and mortgage: an event of default occurred when the loan was

       not renewed, a demand letter was sent, ten days transpired, and the loan was

       not repaid. The Defendants refer us to nothing else that would be required for

       the Bank or PREH, as the Bank’s successor in interest, to enforce the note and

       mortgage.3 Thus, even without the conclusory language of the second Malik

       affidavit, there was sufficient designated evidence to establish that the Bank and

       PREH had met the conditions precedent to enforcing the note and mortgage.


[38]   In short, we find nothing improper in the trial court’s failure to strike Malik’s

       affidavit or in its consideration of the evidence designated by PREH.




       3
         The Defendants also briefly claim, in a two-sentence argument, that the second affidavit from Malik, in
       which he averred that PREH had incurred $125,000 in attorney fees, is insufficient to support an award of
       attorney fees, citing U. S. Aircraft Fin., Inc. v. Jankovich, 407 N.E.2d 287, 295 (Ind. Ct. App. 1980). However,
       this argument is not further developed, and we therefore consider it waived. See Ind. Appellate Rule
       48(a)(8)(A); Loomis v. Ameritech Corp., 764 N.E.2d 658, 668 (Ind. Ct. App. 2002).

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015                         Page 20 of 33
                   III. Did the Parties Agree to a Fourth Loan Renewal?

[39]   The core of the Defendants’ argument is that evidence indicated the Defendants

       and the Bank came to an oral agreement to renew the loan for a fourth time but

       that the Bank subsequently reneged on its agreement. Thus, the Defendants

       argue, the Bank is a breaching party who may not now seek to enforce the loan

       agreements.


[40]   The Defendants contend that on September 10, 2015—five days before the loan

       matured—East Point and the Bank agreed to a three-year renewal and were

       simply waiting for the Bank to prepare the renewal documentation. The

       Defendants admit that, at first blush, this argument appears to be doomed by

       operation of the statute of frauds found in the Indiana Lender Liability Act

       (“ILLA”). See Ind. Code § 26-2-9-4. The Defendants claim, however, that their

       counterclaim does not fall within the purview of this section. Specifically, the

       Defendants argue that, pursuant to the version of the ILLA statute of frauds in

       effect at the time the loan agreement was executed did not apply to

       counterclaims by debtors. See Sees v. Bank One, Ind., N.A., 839 N.E.2d 154, 159

       (Ind. 2005).

[41]   PREH argues that the Defendants’ counterclaim is governed instead by Illinois

       law. PREH notes that loan agreement contained a choice-of-law provision

       providing:


               This Agreement and the Loan Documents shall be governed and
               controlled by the laws of the State of Illinois as to interpretation,
               enforcement, validity, construction, effect, choice of law and in
               all other respects, including, but not limited to, the legality of the

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 21 of 33
               interest rate and other charges, but excluding priority and
               perfection of any liens granted to Bank on the Property, and the
               foreclosure thereof, all of which shall be governed and controlled
               by the laws of the relevant jurisdiction.


       Appellants’ App. p. 355.

[42]   The Defendants admit that, under Illinois law, their allegation of an oral

       agreement to extend the loan maturity date would fail, as Illinois courts have

       long interpreted the applicable Illinois statute of frauds to bar defenses as well

       as counterclaims. See Whirlpool Fin. Corp. v. Sevaux, 96 F.3d 216, 225 (7th Cir.

       1996) (noting that Illinois courts have interpreted the statute of frauds contained

       in the Illinois Credit Agreement Act to proscribe all actions which depend for

       their existence upon an oral credit agreement) (citing Klem v. First Nat’l Bank of

       Chicago, 655 N.E.2d 1211, 1213 (Ill. App. Ct. 1995)).


[43]   The Defendants argue, however, that Illinois law should not apply, insisting

       that the statute of frauds is merely procedural in nature. The Defendants note:


               A contract provision that an agreement is to be governed by the
               law of another state operates only as to the substantive law of
               that state, and the procedural law of the forum state applies to
               procedural issues. Laws that merely prescribe the manner in
               which individual rights and responsibilities may be exercised and
               enforced in a court are procedural.


       Simon Prop. Grp., L.P. v. Acton Enterprises, Inc., 827 N.E.2d 1235, 1237 (Ind. Ct.

       App. 2005) (citing Ind. CPA Society v. GoMembers, Inc., 777 N.E.2d 747, 749-50

       (Ind. Ct. App. 2002)).

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 22 of 33
[44]   The question, therefore, becomes whether the statute of frauds is a substantive

       or procedural law. If it is procedural, then Indiana law applies, and their claim

       of an oral loan renewal might survive. If it is substantive, then Illinois law

       applies, and their claim of an oral renewal is barred.

[45]   Jurisdictions appear to be split on this issue. See Comment note—Statute of

       Frauds and Conflict of Laws, 47 A.L.R.3d 137 §2[a]. However, Indiana courts

       have long held that a statute of frauds is a substantive law. See id. at 5[b] (citing

       Henning v. Hill, 80 Ind. App. 363, 141 N.E. 66 (1923); Cochran v. Ward, 5 Ind.

       App. 89, 29 N.E. 795 (1892)). Indeed, in Cochran, the court held that the Illinois

       statute of frauds “became part of the agreement in suit, and the provision [in the

       statute of frauds] that no action should be maintained for damages for the

       breach of the agreement became as much a part of its character and substance

       as if specifically incorporated therein.” Cochran, 29 N.E. at 797.


[46]   We agree with the court in Cochran and hold that the Illinois statute of frauds is

       substantive and not merely procedural. Because it is substantive, the Illinois

       statute controls.4 Under Illinois law, the Defendants’ defense of an oral



       4
         Even if Indiana law applied, it is not clear that the Defendants’ claim of an oral agreement would be viable.
       As amended effective July 1, 2006, the ILLA statue of frauds bars claims based on verbal agreements
       regardless of whether they are brought by a creditor or a debtor. Thus, the current ILLA statute of frauds
       would bar the Defendants’ claim that the Bank made an oral agreement in September 2015 to further extend
       the loan maturity date.
       Still, the Defendants contend that, because the original promissory note was executed on May 1, 2006, we
       should apply the then-existing version of the ILLA statute of frauds, which was held not to apply to a debtor’s
       assertion of an affirmative defense based on an alleged oral representation by the creditor. See Sees, 839
       N.E.2d at 159. The only authority cited by the Defendants in support of their position is Paulson v. Centier
       Bank, 704 N.E.2d 482 (Ind. Ct. App. 1998). However, in that case, the court held that a creditor’s
       counterclaim based on an alleged oral agreement was not barred by the ILLA statute of frauds because the

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015                       Page 23 of 33
       agreement to renew the loan is barred. Accordingly, the Defendants’ claim that

       the loan maturity date was extended by an oral agreement fails.5

                                IV. Did the Bank Breach the Contract?

[47]   The Defendants also claim that it was the Bank who breached the loan

       agreement first by failing to honor the verbal loan renewal agreement. Because

       the Defendants’ claim of a verbal renewal of the loan agreement is barred by the

       applicable statute of frauds, their claim that the Bank was the initially breaching

       party for failing to honor the terms of the alleged renewal necessarily fails.


[48]   Still, the Defendants argue that the Bank breached the terms of the loan

       agreement when it failed to fund a draw requested by East Point. Specifically,

       the Defendants claim that, two days before the stated maturity date, the Bank

       failed to honor East Point’s fourth draw request in the amount of $32,500,

       which was required to make a mortgage payment to Fieldview. Section 2.3(a)

       of the loan agreement provides that East Point was allowed to use loan

       proceeds to “acquire the Property.” Appellants’ App. p. 336; see also note 2,




       note was dated prior to the effective date of the ILLA. See id. at 491; see also Ind. Code § 26-2-9-0.2 (providing
       that the ILLA “does not apply to credit agreements entered into before July 1, 1989.”).
       In contrast, here, the promissory note was executed on May 1, 2006, well after the effective date of the ILLA.
       Also, the alleged oral agreement was entered into well after the effective date of the current version of the
       ILLA statute of frauds barring a defense based on an alleged oral agreement.
       5
         The Defendants also briefly claim, without citation to authority, that their claim of a verbal extension of
       the maturity date, as a defense to the foreclosure action, should be governed by Indiana law because the
       foreclosure is governed by Indiana law. This claim, however, is not fully developed, and we therefore will
       not consider it on appeal. See Ind. Appellate Rule 48(a)(8)(A); Loomis v. Ameritech Corp., 764 N.E.2d 658, 668
       (Ind. Ct. App. 2002).

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015                         Page 24 of 33
       supra. The Bank honored previous draw requests, and acknowledged that the

       draws were not improper. Thus, the Defendants claim, the Bank breached the

       loan agreement by failing to honor and fund the fourth draw request. We

       disagree.

[49]   Section 2.3(a) of the loan agreement permitted East Point to “acquire” the

       Property with the loan proceeds. Id. However, by the time of the fourth draw

       request, East Point had already acquired the Property. Although the other draw

       requests were used to pay the mortgage payments on the second mortgage held

       by Fieldview, the Defendants refer us to nothing in the loan agreement that

       would require the Bank to fund the draw requests so that East Point could make

       a payment on the Fieldview mortgage. Instead, the plain language of the loan

       agreement seems to contemplate the interest reserve to be used only to pay the

       interest on the loan. Id.


[50]   We therefore cannot say that the Defendants have demonstrated the existence

       of a genuine issue of material fact with regard to whether the Bank breached the

       loan agreement.6




       6
         To the extent that the Defendants claim that the Bank’s prior approval of the draw requests established a
       course of dealings that was violated when the Bank refused to fund the fourth draw request, such claim is
       waived for failure to make fully-developed, cogent argument. See App. Rule 48(a)(8)(A); Loomis, 764 N.E.2d
       at 668. Furthermore, we agree with PREH that this argument would contravene the Subordination
       Agreement signed by the parties. Paragraph 18 of the Subordination Agreement provides that “no course of
       dealings between the parties, no usage of trade and no parole [sic] or extrinsic evidence of any nature shall be
       used to supplement or modify any of the terms of provisions of this Agreement.” Appellants’ App. p. 518.

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015                       Page 25 of 33
          V. Is the Foreclosure Action Barred by the Bank’s Unclean Hands?

[51]   Lastly, the Defendants claim that PREH, as the successor in interest to the

       Bank, should not be able to foreclose on the mortgage because of the Bank’s

       allegedly unclean hands. Foreclosure actions are equitable in nature, and trial

       courts have full discretion to fashion equitable remedies that are complete and

       fair to all parties involved. City Sav. Bank v. Eby Const., LLC, 954 N.E.2d 459,

       464 (Ind. Ct. App. 2011). The equitable doctrine of “unclean hands” provides

       that the party who seeks equitable relief must be free of wrongdoing in the

       matter before the court. Id. at 465.


[52]   The Defendants argue that the Bank was not free of wrongdoing in its dealings

       with East Point. The Defendants point to the Bank’s behavior when negotiating

       with East Point to renew the loan, specifically: the Bank’s desire to group the

       East Point loan with the other Manhard loans; the Bank’s proposal to transfer

       $500,000 of the debt from one of the Manhard loans to the East Point loan; and

       the Bank’s request that Barrett, one of the guarantors of the East Point loan, pay

       delinquent real estate taxes on another parcel he owned.


[53]   We fail to see how any of these actions constitute unclean hands. East Point

       was attempting to negotiate a long-term loan renewal with the Bank. In

       exchange, the Bank was attempting to obtain certain concessions from East

       Point and its guarantors. We do not view this as evidence of unclean hands; it

       was simply part of the negotiation process in the renewal of a multi-million-

       dollar loan among sophisticated parties.


       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 26 of 33
[54]   The same is true of the Bank’s decision to “scrap” the loan renewal process and

       seek its legal remedies under the loan agreement. The Defendants refer us to

       nothing that would suggest that the Bank was obligated to renew the loan. To

       the extent that the Defendants claim that the Bank came to a verbal agreement

       to renew the loan only to later renege on the agreement, we have rejected this

       argument above. We will not say that the Bank acted improperly by not

       renewing a loan it was under no obligation to renew.


[55]   We also cannot agree with the Defendants that the Bank’s settlement with the

       Manhards and Barrett constitutes abuse of process. An action for abuse of

       process requires a finding of misuse or misapplication of process for an end

       other than that which it was designed to accomplish. Watson v. Auto Advisors,

       Inc., 822 N.E.2d 1017, 1029 (Ind. Ct. App. 2005) (citing Nat’l City Bank, Ind. v.

       Shortridge, 689 N.E.2d 1248, 1252 (Ind. 1997)). An action for abuse of process

       has two elements: (1) ulterior purpose or motives, and (2) a willful act in the use

       of process not proper in the regular conduct of the proceeding. Id. (citing Town

       of Orland v. Nat’l Fire & Cas. Co., 726 N.E.2d 364, 371 (Ind. Ct. App. 2000)).

       However, if a party’s acts are procedurally and substantively proper under the

       circumstances, then that party’s intent is irrelevant. Id. (citing Reichhart v. City of

       New Haven, 674 N.E.2d 27, 31 (Ind. Ct. App. 1996)). A party may not be held

       liable for abuse of process if the legal process has been used to accomplish an

       outcome which the process was designed to accomplish. Id.; see also Cent. Nat'l

       Bank of Greencastle v. Shoup, 501 N.E.2d 1090, 1095 (Ind. Ct. App. 1986) (“[a]

       regular and legitimate use of process, though with an ulterior motive or bad

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 27 of 33
       intention is not a malicious abuse of process”) (quoting Brown v. Robertson, 120

       Ind. App. 434, 92 N.E.2d 856, 858 (Ind. Ct. App. 1950)).

[56]   Here, the Bank filed suit to collect on a loan that had matured and on which

       East Point had defaulted. The Defendants make no argument that East Point

       does not owe the money it borrowed. The Bank simply sought to foreclose on

       the mortgage to secure repayment of the loan balance. This was a legitimate use

       of process. Accordingly, any ulterior motive is irrelevant. See id. (citing

       Reichhart, 674 N.E.2d at 31).7


[57]   We similarly reject the Defendants’ claims that the Bank intentionally induced

       the Manhards and Barrett to withhold documents and information from the

       Defendants through coercion. First, the only act referenced is the Bank’s take-it-

       or-leave-it settlement offer, which we consider as an end to negotiations, rather

       than “coercion.” Moreover, the Defendants do not precisely explain which

       documents and information the Bank induced the Manhards and Barrett to

       withhold, but this appears to be a reference to the portion of the settlement

       agreement between the Bank and the Manhards and Barrett that contained the

       following provision:




       7
         Thus, the Defendants’ citation to Nat'l City Bank, Ind. v. Shortridge, 689 N.E.2d 1248, 1253 (Ind. 1997),
       supplemented 691 N.E.2d 1210 (Ind. 1998), is unavailing. In Shortridge, the court held that a genuine issue of
       material fact existed with regard to whether the defendant’s attorney abused process by filing two improper lis
       pendens notices against property to secure an interest in a pending personal injury lawsuit, despite the law
       being clear that lis pendens is not the proper avenue to secure an interest in a pending personal injury lawsuit.
       Id. at 1253. In contrast, here, the Bank’s filing of the foreclosure action was the appropriate action to recover
       the funds owed when the loan was in default.

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015                        Page 28 of 33
                Guarantor [i.e., the Manhards and Barrett] shall not, directly or
                indirectly, take any action or cause or permit Lake Charles, or
                any other entity in which Guarantor, directly or indirectly has a
                controlling ownership interest, to contest, delay, hinder, interfere
                with or otherwise affect the prosecution of the Foreclosure
                Action by the Lender or provide any assistance to the Borrower,
                directly or indirectly, in contesting, defending, delaying or
                otherwise hindering the prosecution of the Foreclosure Action by
                the Lender. Guarantors testifying in court or in depositions or
                providing documents or responses to interrogatories or requests for
                information filed under or permitted under court rules or pursuant to a
                subpoena or acts required by order of court in connection with the
                foreclosure action or other litigation which may be filed by Fieldview or
                its Members, or Karen Rusin, or Borrower, or another third party shall
                not be considered a breach of the foregoing provisions.


       Appellants’ App. p. 1363 (emphasis added). The Defendants’ argument that

       this provision prohibited the Manhards and Barrett from providing documents

       during the lawsuit appears to be in direct conflict with the above-emphasized

       portion of the settlement agreements that clearly states participating in the

       discovery process and obeying court orders is not prohibited.8


[58]   We also cannot agree with the Defendants that the Bank tortiously interfered

       with East Point’s corporate governance by settling with the Manhards and

       Barrett. The Defendants note that the settlement agreements prevented the

       Manhards and Barrett from hindering, delaying, or affecting the foreclosure




       8
         The Defendants note that the trial court sanctioned the Bank for delays in discovery that resulted in delays
       in the Defendants’ summary judgment response. However, in its order, the trial court noted that although
       “East Point did much more than should have been necessary to obtain the documents it requested,” the trial
       court “d[id] not find that Private Bank has deliberately engaged in obstruction[.]” Appellants’ App. p. 592.

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015                      Page 29 of 33
       action. The Defendants argue that this prevented East Point from seeking other

       means of paying off the loan, such as selling the undeveloped portions of the

       Property, seeking financial assistance from the Manhards and Barrett, or

       seeking other partners to help develop the Property. However, the Defendants

       fail to explain exactly how this amounts to tortious interference with the

       corporate governance agreements of East Point. Indeed, the Defendants do not

       even set forth the elements of tortious interference in their brief. Instead, the

       Bank simply settled with some of the East Point guarantors but not the others.

       Although this has obviously placed Fieldview and Rusin in a difficult position,

       it is a common strategy in pending litigation, and we cannot say that it amounts

       to tortious interference.


[59]   The Defendants also argue at some length that the Bank, and PREH as its

       successor in interest, has as its goal not the repayment of the loan but

       possession of the Property so that it may sell it at a premium after the work

       done by East Point. The Defendants note that the Bank’s own estimates put the

       value of the Property at $7.45 million, whereas the loan balance was only $2.96

       million. They also claim that the Bank expected a recovery of $6.85 million

       through the mortgage foreclosure. This argument, however, seems to

       misunderstand the nature of a foreclosure proceeding.

[60]   By proceeding with foreclosure, the Bank may have the right to sell the

       Property at a foreclosure sale to satisfy the balance of the loan, but this does not

       automatically give it the right to possess the Property, nor is any surplus kept as

       a windfall by the mortgagee bank. As we have explained before:

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 30 of 33
        Indiana is unequivocally committed to the lien theory [of
        mortgage] and the mortgagee has no title to the land mortgaged.
        The right to possession, use and enjoyment of the mortgaged
        property, as well as title, remains in the mortgagor, unless
        otherwise specifically provided, and the mortgage is a mere
        security for the debt.


Merrillville 2548, Inc. v. BMO Harris Bank N.A., No. 45A03-1409-MF-345, 2015

WL 3603850, at *11 (Ind. Ct. App. June 9, 2015), reh’g denied, trans. pending

(quoting Oldham v. Noble, 117 Ind. App. 68, 75-76, 66 N.E.2d 614, 617 (1946)).

The proceeds of a mortgage sale are distributed as provided by the relevant

statute:


        The proceeds of a sale described in IC 32-29-7 or section 8 or
        12(b) of this chapter must be applied in the following order:
        (1) Expenses of the offer and sale, including expenses incurred
            under IC 32-29-7-4 or section 9 of this chapter (or IC 34-1-53-
            6.5 or IC 32-15-6-6.5 before their repeal).
        (2) The payment of the principal due, interest, and costs not
            described in subdivision (1).
        (3) The residue secured by the mortgage and not due.
        (4) If the residue referred to in subdivision (3) does not bear
            interest, a deduction must be made by discounting the legal
            interest.

        In all cases in which the proceeds of sale exceed the amounts
        described in subdivisions (1) through (4), the surplus must be paid to
        the clerk of the court to be transferred, as the court directs, to the mortgage
        debtor, mortgage debtor's heirs, or other persons assigned by the mortgage
        debtor.




Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015         Page 31 of 33
       Ind. Code § 32-30-10-14 (emphasis added). Subsequent liens on the property

       sold share in the proceeds of the sale only after the mortgage and other prior

       liens adjudged have been satisfied. See 20 Ind. Law Encyc. Mortgages § 175

       (2015).9

[61]   We also reject the Defendants’ claims that the Bank “highjacked” East Point’s

       right to alienate the Property by settling with the Manhards and Barrett. The

       Bank simply settled with some, but not all, of the guarantors. We fail to see

       how this can be considered inequitable or tortious conduct.

                                                       Conclusion

[62]   In conclusion, we hold that the Defendants filed their designated evidence in an

       untimely fashion and that such evidence should therefore not be considered.

       We also hold that the trial court did not err in denying the Defendants’ motion

       to strike the affidavit of Arshad Malik, which was submitted by PREH in

       support of its motion for summary judgment. The Defendants’ argument that

       the Bank made an oral agreement to a fourth loan renewal is barred by the

       relevant Illinois statute of frauds, which, as a substantive law, is applicable to

       the interpretation of the loan agreements. We also conclude that the Bank did

       not breach the loan agreements by reneging on the alleged oral agreement or by

       failing to fund the last draw request by the Defendants. Lastly, the foreclosure

       action is not prevented by the Bank or PREH’s allegedly unclean hands.



       9
         As the issue is not before us, we express no opinion with regard to the rights to the surplus, if any, that
       results from the mortgage foreclosure sale of the Property.

       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015                         Page 32 of 33
       Accordingly, we affirm the order of the trial court granting summary judgment

       in favor of PREH.

[63]   Affirmed.


       Baker, J., and Bailey, J., concur.




       Court of Appeals of Indiana | Opinion 45A05-1412-MF-584 | December 31, 2015   Page 33 of 33
