MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be                                    FILED
regarded as precedent or cited before any                           May 16 2017, 11:08 am

court except for the purpose of establishing                             CLERK
the defense of res judicata, collateral                              Indiana Supreme Court
                                                                        Court of Appeals
                                                                          and Tax Court
estoppel, or the law of the case.


ATTORNEY FOR APPELLANT
Jennifer L. Koethe
La Porte, Indiana


                                          IN THE
    COURT OF APPEALS OF INDIANA

Diane Haas,                                              May 16, 2017
Appellant-Plaintiff,                                     Court of Appeals Case No.
                                                         46A04-1610-SC-2437
        v.                                               Appeal from the La Porte Superior
                                                         Court
Michael Carpenter,                                       The Honorable Jeffrey Thorne,
Appellee-Defendant.                                      Judge
                                                         Trial Court Cause No.
                                                         46D03-1606-SC-1230



Riley, Judge.




Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017          Page 1 of 12
                                STATEMENT OF THE CASE
[1]   Appellant-Plaintiff, Diane Haas (Haas), appeals the small claims court’s

      judgment in this landlord-tenant dispute with Appellee-Defendant, Michael

      Carpenter (Carpenter).


[2]   We affirm.


                                                    ISSUE
[3]   Haas presents us with one issue on appeal, which we restate as: Whether the

      small claims court erred in its damage award as a result of a bed bug infestation

      in a multi-unit apartment complex.


                      FACTS AND PROCEDURAL HISTORY
[4]   Haas is the owner of real estate, consisting of four separate apartments, located

      in LaPorte, Indiana. In November 2014, Haas, as the landlord, entered into a

      lease agreement pursuant to which Carpenter agreed to lease apartment #3.

      Carpenter paid a security deposit of $600.00. Tenants in good standing “as far

      as paying rent,” have the first option to move into a larger apartment when one

      becomes available. (Transcript p. 6). Accordingly, on August 1, 2015,

      Carpenter entered into a new lease with Haas, pursuant to which Carpenter

      agreed to lease apartment #2 for a “bimonthly” rent of $650. (Plaintiff’s Exh.

      5, p.1). The $600.00 security deposit was assigned from the lease of apartment

      #3 to the lease of apartment #2. The terms of the lease provided, in pertinent

      part, that Carpenter “shall comply with all the sanitary laws, ordinances, rules

      and orders of appropriate governmental authorities affecting the cleanliness,
      Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017   Page 2 of 12
      occupancy, and preservation of the premises[.]” (Plaintiff’s Exh. 5, p. 2). On

      March 1, 2016, Haas and Carpenter entered into a new lease agreement by

      which Carpenter rented from Haas apartment #1. The original $600.00

      security deposit applied to the rent of apartment #3 and assigned to #2 was

      then transferred to the rent of apartment #1.


[5]   During the move from apartment #2 to apartment #1, Haas talked with

      Carpenter “to see how things were going.” (Tr. p. 8). Carpenter mentioned

      that he was going to the Goodwill Store and Haas cautioned him because “it’s

      been known that they have had bed bugs and any furniture, bedding, anything

      like that, even clothing, has to be laundered – or washed down.” (Tr. p. 8).

      Carpenter replied that he knew “all about that” because he had had bed bugs in

      apartment #2 since December 2015. According to Carpenter, Carpenter’s

      friend who had been renting the basement apartment might have brought the

      bed bugs in the building. As his friend had visited with him in apartment #2,

      the bed bugs transferred to apartment #2 as well. Carpenter did not see the bed

      bugs “personally;” his wife “was the only one getting bitten. [His] son was not

      getting bitten. Neither was [his] father.” (Tr. p. 31). Haas had a professional

      company, Hatfield Pest Control (Hatfield), inspect the building and treat it for

      bed bugs. Carpenter moved out of the building at the end of June 2016.


[6]   On June 20, 2016, Haas filed a Complaint in the small claims court, seeking

      “[l]oss of rents, failure to provide notice of bed bugs, 3 months clean up apt.#2

      in an amount to be determined, as well as costs of the proceeding.”

      (Appellant’s App. Vol. II, p. 4). On August 12, 2016, the small claims court

      Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017   Page 3 of 12
conducted a bench trial and issued the following judgment on August 17, 2016,

providing, in pertinent part:

        7. HAAS never sought to recover any damages from
        CARPENTER relative to his occupancy of apartment #3 in the
        SUBJECT PREMISES.


        8. Only after CARPENTER vacated occupancy of apartment #1
        of the SUBJECT PREMISES did HAAS seek reimbursement for
        any damages relative to CARPENTER’S occupancy in
        apartment #2 at the SUBJECT PREMISES.


        9. CARPENTER’S Exhibit ‘B’, a document entitled
        “PREMISES INSPECTION MOVE-IN/MOVE-OUT” showed
        that as of August 1, 2015 there were numerous matters that
        needed repair or cleaning relative to apartment #2 at the
        SUBJECT PREMISES.


        10. No such Premises Inspection Document was prepared by the
        parties when CARPENTER took possession of apartment #1 of
        the SUBJECT PREMISES in March 2016.


        11. The [c]ourt awards HAAS a total of $250.00 for various
        repairs and/or maintenance above and beyond normal wear and
        tear relative to CARPENTER’S occupation of apartments 3, 2,
        and 1 in the SUBJECT PREMISES.


        12. In March 2016, HAAS incurred expenses with [Hatfield] for
        an inspection and treatment of all four (4) apartments in the
        SUBJECT PREMISES for an infestation of bed bugs which
        expenses totaled 3,075.00.


        13. As bed bugs were found in at least two (2) of the apartments
        at the SUBJECT PREMISES, HAAS has been unable to
Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017   Page 4 of 12
              establish that CARPENTER was the original source of the bed
              bug infestation. Therefore, the [c]ourt finds that CARPENTER
              should be responsible for only $768.75 of said expenses.


              14. The [c]ourt denied HAAS’ request that damages incurred by
              HAAS for loss of rent for apartments 2 and 4 should be assessed
              against CARPENTER since it has not been established that
              CARPENTER was the true source of the bed bug infestation.


              15. CARPENTER is entitled to a credit against the
              aforementioned damages in the amount $600.00 representing the
              damages deposit paid.


              IT IS THEREFORE ORDERED, ADJUDGED AND
              DECREED that judgment be entered in favor of Plaintiff,
              DIANE HAAS, and against defendant, MICHAEL
              CARPENTER, in the amount of $418.75 plus costs of the action
              in the amount of $132.00 for a total of $550.75 plus interest from
              the date of judgment at the rate of 8% per annum.


      (Appellant’s App. Vol. II, pp. 8-9).


[7]   Haas now appeals. Additional facts will be provided as necessary.


                              DISCUSSION AND DECISION
[8]   Haas contends that the small claims court abused its discretion by failing to

      award her the total cost for the bed bug remediation at the apartment complex

      and for the loss of rent in the amount of $2,300.00.


[9]   Judgments in small claims actions are “subject to review as prescribed by

      relevant Indiana rules and statutes.” Ind. Small Claims Rule 11(A). Under


      Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017   Page 5 of 12
       Indiana Trial Rule 52(A), the clearly erroneous standard applies to appellate

       review of facts determined in a bench trial with due regard given to the

       opportunity of the trial court to assess witness credibility. This “deferential

       standard of review is particularly important in small claims actions, where trials

       are ‘informal, with the sole objective of dispensing speedy justice between the

       parties according to the rules of substantive law.’” Trinity Homes, LLC v. Fang,

       848 N.E.2d 1065, 1067-68 (Ind. 2006) (citing City of Dunkirk Water & Sewage

       Dep’t v. Hall, 657 N.E.2d 115, 116 (Ind. 1995)). But this deferential standard

       does not apply to the substantive rules of law, which are reviewed de novo just

       as they are in appeals from a court of general jurisdiction. Trinity Homes, LLC,

       848 N.E.2d 1068. Parties in a small claims court bear the same burdens of

       proof as they would in a regular civil action on the same issues. Hastetter v.

       Fetter Properties, LLC, 873 N.E.2d 679, 682 (Ind. Ct. App. 2007). We consider

       evidence in the light most favorable to the judgment, together with all

       reasonable inferences to be drawn therefrom. Id.


[10]   Initially, we observe that Carpenter has not filed an appellate brief. When the

       appellee has failed to submit an answer brief we need not undertake the burden

       of developing an argument on the appellee’s behalf. Trinity Homes, LLC, 848

       N.E.2d at 1068. Rather, we will reverse the small claims court’s judgment if the

       appellant’s brief presents a case of prima facie error. Id. Prima facie error in this

       context is defined as, “at first sight, on first appearance, or on the face of it.” Id.

       Where an appellant is unable to meet this burden, we will affirm. Id.


                                          I. Bed Bug Treatment Costs

       Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017   Page 6 of 12
[11]   Pursuant to Section Two of the agreement to lease apartment #2, Carpenter

                shall comply with all the sanitary laws, ordinances, rules and
                orders of appropriate governmental authorities affecting the
                cleanliness, occupancy, and preservation of the premises, . . .,
                during the term of this lease.


       (Plaintiff’s Exh. #5, p. 2). Relying on Indiana Code § 32-31-7-6 1 and the City of

       LaPorte Ordinance, Haas advocates for the application of Section 10-446,

       dealing with extermination, which states:


                (a) Infestation. All structures shall be kept free from insect and
                    rodent infestation. All structures [in]which insects and
                    rodents are found shall be promptly exterminated by
                    approved processes that will not be injurious to human health.
                    After extermination, proper precautions shall be taken to
                    prevent re-infestation.


                (b) Owner. The owner of any structure shall be responsible for
                    extermination within the structure prior to renting or leasing
                    the structure.


                (c) Single occupant. The occupant of a one-family dwelling or of a
                    single-tenant nonresidential structure shall be responsible for
                    extermination on the premises.


                (d) Multiple occupancy. The owner of a structure containing two
                    or more dwelling units, a multiple occupancy, a rooming




       1
        Indiana Code § 32-31-7-6 provides that “[a]t the termination of a tenant’s occupancy, the tenant shall
       deliver the rental premises to the landlord in a clean and proper condition, excepting ordinary wear and tear
       expected in the normal course of habitation of a dwelling unit.”

       Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017               Page 7 of 12
                   house or a nonresidential structure shall be responsible for
                   extermination in the public or shared areas of the structure
                   and exterior property. If infestation is caused by failure of an
                   occupant to prevent such infestation in the area occupied, the
                   occupants shall be responsible for extermination.


               (e) Occupant. The occupant of any structure shall be responsible
                   for the continued rodent and pest-free condition of the
                   structure.


                       Exception: Where the infestations are caused by defects in
                       the structure, the owner shall be responsible for
                       extermination.


       (Appellant’s App. Vol. II, p. 17). Based on this provision of the City of LaPorte

       Ordinance, Haas contends that “[o]nce [Carpenter] failed to comply with the

       Ordinance, by failing to treat the infestation, the entire four-unit apartment was

       exposed and was required to be treated.” (Appellant’s Br. p. 11). Accordingly,

       Haas requests this court to grant her the full cost of the bed bug treatment, i.e.,

       $3,075.00.


[12]   Interpretation of an ordinance is subject to the same rules that govern the

       construction of a state statute. Mint Mgmt., LLC v. City of Richmond, 69 N.E.3d

       561, 565 (Ind. Ct. App. 2017) (quoting Rollet Family Farms, LLC v. Area Plan

       Comm’n of Evansville-Vanderburgh Cty., 994 N.E.2d 734, 738 (Ind. Ct. App.

       2013)). Words are to be given their plain, ordinary, and usual meaning, unless

       a contrary purpose is shown by the statute or ordinance itself. Mint Mgmt.,

       LLC, 69 N.E.3d at 565. Where possible, every word must be given effect and


       Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017   Page 8 of 12
       meaning, and no part is to be held meaningless if it can be reconciled with the

       rest of the statute. Id. The goal in statutory construction is to determine and

       effect legislative intent. Id. Courts must give deference to such intent whenever

       possible. Id. Thus, courts must consider the goals of the statute, and the

       reasons and policy underlying the statute’s enactment. Id. If the legislative

       intent is clear from the language of the statute, the language prevails and will be

       given effect. Id.


[13]   The evidence reflects that while Carpenter was moving from apartment #2 to

       apartment #1, he mentioned to Haas that he had had bed bugs in apartment #2

       since December 2015. At the hearing, Carpenter clarified that Carpenter’s

       friend, who had been renting the basement apartment, might have brought the

       bed bugs into the building. As his friend had visited apartment #2, the bed bugs

       might have transferred into Carpenter’s apartment during that visit. An

       inspection by Hatfield revealed the existence of bed bugs in the “basement

       apartment and in [a]partment # 2.” (Tr. p. 8). All four apartments in the

       building were treated for a bed bug infestation. In its judgment, the small

       claims court only allocated 1/4th of the total cost of the remediation to

       Carpenter.


[14]   With regard to multiple occupancy, the City of LaPorte ordinance provides that

       an occupant is responsible “to prevent such infestation in the area occupied.”

       (Appellant’s App. Vol. II, p. 17). At the moment Haas became aware of the

       bed bug infestation, Carpenter had only occupied apartment #2, where

       Hatfield’s inspection confirmed the presence of bed bugs. Haas did not

       Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017   Page 9 of 12
       introduce any evidence contradicting Carpenter’s testimony that the bed bugs

       originated with the occupant of the basement apartment. Therefore, the small

       claims court did not abuse its discretion in awarding Haas only $768.75, or

       1/4th of the bed bug remediation expenses.


                                                 II. Loss of Rent


[15]   Haas claims that “[a]s a result of [Carpenter’s] failure to comply with LaPorte

       Ordinance Section 10-466 (a), (d) and (c), [Haas] incurred . . . loss of rent in the

       amount of $2300.00.” (Appellant’s Br. p. 11). Specifically, Haas’ loss of rent

       request includes two months of rent respectively for apartment #2 and the

       basement apartment.


[16]   Generally, a party injured by a breach of contract may receive consequential

       damages. Johnson v. Scandia Assocs., 717 N.E.2d 24, 31 (Ind. 1999).

       Consequential damages may be awarded on a breach of contract claim when

       the non-breaching party’s loss flows naturally and probably from the breach and

       was contemplated by the parties when the contract was made. Id. “This

       follows the rule announced in Hadley v. Baxendale, 156 Eng. Rep. 145 (1854),

       and generally limits consequential damages to reasonably foreseeable economic

       losses.” Indianapolis City Market Corp. v. MAV, Inc., 915 N.E.2d 1013, 1024 (Ind.

       Ct. App. 2009). A factfinder may not award damages on the mere basis of

       conjecture or speculation. Id.


[17]   However, because we found Carpenter contractually responsible for the bed bug

       infestation in apartment #2, Haas’ consequential damages, if any, are limited to

       Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017   Page 10 of 12
       the loss of rent of apartment #2. Haas claims that the apartment could not be

       rented while Hatfield was treating the building for the infestation. Evidence

       deduced at the hearing indicates that Haas showed apartment #2 to a potential

       tenant, who was aware of the bed bug infestation. When Haas and the

       potential tenant “went through the apartment and she saw the actual condition

       and the condition of the back yard, she said no I’m not gonna do it.” (Tr. p.

       18). When receiving this testimony, the small claims court opined that “Well,

       then it wasn’t uninhabitable. [] [T]he backyard caused this person not to rent

       it.” (Tr. p. 18). Furthermore, while the treatment against bed bugs was being

       applied, Haas admitted that tenants were living in apartment #1 and #3.


[18]   In light of the evidence that tenants were living in two of the four apartments

       while the building was being treated for bed bugs and the evidence that

       apartment #2 could have been rented if the backyard had been in better

       condition, Haas did not establish that her loss of rent of apartment #2 was a

       result of the bed bug infestation. Moreover, even though the lease agreement

       entered into between Carpenter and Haas for apartment #2 includes a provision

       to mandate the compliance with “the sanitary laws, ordinances, rules and

       orders of appropriate governmental authorities[,]” the provision is silent with

       respect to damages in the event of noncompliance. (Plaintiff’s Exh. #5, p. 2);

       see Johnson, 717 N.E.2d at 31 (consequential damages must be contemplated by

       the parties when entering into the contract). Accordingly, we affirm the small

       claims court’s denial of Haas’ request to award her loss of rent.




       Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017   Page 11 of 12
                                             CONCLUSION
[19]   Based on the foregoing, we hold that the small claims court did not err in its

       damage award as a result of a bed bug infestation in a multi-unit apartment

       complex.


[20]   Affirmed.


[21]   Najam, J. and Bradford, J. concur




       Court of Appeals of Indiana | Memorandum Decision 46A04-1610-SC-2437 | May 16, 2017   Page 12 of 12
