                                                                                 FILED
                                                                             Oct 19 2018, 8:57 am

                                                                                 CLERK
                                                                             Indiana Supreme Court
                                                                                Court of Appeals
                                                                                  and Tax Court




      ATTORNEYS FOR APPELLANTS                                   ATTORNEYS FOR APPELLEES
      Clay W. Havill                                             James D. Johnson
      Francis X. Mattingly                                       Blair M. Gardner
      L. Katherine Boren                                         Jackson Kelly, PLLC
      Ziemer, Stayman, Weitzel &                                 Evansville, Indiana
      Shoulders, LLP
      Evansville, Indiana



                                                  IN THE
          COURT OF APPEALS OF INDIANA

      Destination Yachts, Inc., and                              October 19, 2018
      Sheldon Graber,                                            Court of Appeals Case No.
      Appellants-Defendants,                                     18A-CT-1057
                                                                 Appeal from the Daviess Circuit
              v.                                                 Court
                                                                 The Honorable Mark R.
      Shirley Pierce and Al Burnham,                             McConnell, Special Judge
      Appellees-Plaintiffs.                                      Trial Court Cause No.
                                                                 14C01-1706-CT-272



      Mathias, Judge.


[1]   Shirley Pierce (“Pierce”) and Al Burnham (“Burnham”) (collectively “the

      Purchasers”) bought a houseboat manufactured and sold by Destination

      Yachts, Inc. (“DYI”). Thereafter, the Purchasers led a complaint in Daviess

      Circuit Court against DYI and its president, Sheldon Graber (“Graber”)


      Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018                           Page 1 of 23
      (collectively “the Defendants”), alleging various contract and tort claims arising

      out of their purchase of the houseboat. The Defendants subsequently led a

      motion to dismiss the Purchasers’ claims, arguing inter alia that the purchase

      agreement was subject to a mandatory, binding arbitration clause. The trial

      court granted the motion to dismiss with prejudice. The parties then proceeded

      to arbitration, but before the arbitration could occur, the Defendants led a

      motion with the arbitrator claiming that the trial court’s order dismissing the

      Purchasers’ claims with prejudice was a judgment on the merits that acted to

      bar any subsequent claim, including arbitration. The Purchasers then returned

      to the trial court and led a motion to correct error or, in the alternative, for

      relief from judgment arguing that the earlier dismissal with prejudice did not

      bar arbitration. The trial court agreed and granted the motion. The Defendants

      appeal and present two issues, which we restate as: (1) whether the trial court

      erred by granting the Purchasers’ motion to correct error/motion for relief from

      judgment, and (2) whether Graber is a party to the contract and therefore

      properly subject to any arbitrable claims.


[2]   We af rm.


                                  Facts and Procedural History
[3]   The Purchasers met with Graber at DYI’s Washington, Indiana location on

      April 24, 2014, to discuss the purchase of a houseboat. After some discussion,

      the Purchasers and DYI entered into a Contract and Purchase Agreement (“the

      Agreement”) which provided that the Purchasers agreed to buy a custom-built


      Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018       Page 2 of 23
houseboat for a price of $314,909.19. Included in this Agreement, which was

drafted by DYI, was an arbitration clause that provides:


                                  SECTION THREE
                              RESOLUTION OF PROBLEMS

        It is understood and agreed that any problems arising during the
        construction of the boat can best be resolved by maintenance of a
        close liaison between Builder and Purchaser, and that the parties
        will make every good-faith effort to avoid and resolve any
        problems and disputes by maintaining such close liaison between
        Builder and Purchaser. All disputes, complaints, problems and
        objections relating to the terms, conditions and obligations of
        the within Purchase Agreement, unless resolved directly
        between Builder and Purchaser, shall be submitted to binding
        arbitration in the matter set forth in Sections Seven and
        Twelve below.

                                                 ***

                                       SECTION SEVEN
                                         INSPECTION

        All work-in-process at Builder’s plant shall be subject to
        inspection by Purchaser, and Builder shall grant Purchaser access
        to Builder’s premises for such inspection at all reasonable times
        and upon prior notice by Purchaser.

        Prior to the completion of the boat, Purchaser and/or a
        representative of Purchaser and Builder and/or a representative
        of Builder shall carry out a nal inspection of the boat, at the
        conclusion of which Purchaser shall be entitled to submit in
        writing, to Builder, such changes, complaints and/or objections,
        if any, as Purchaser may have with respect to the construction of
        the boat within seven (7) days of inspection. Any valid
        complaints or objections so stated shall be corrected or remedied
        by Builder as soon as practical thereafter.

Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018    Page 3 of 23
        In the event purchaser does not inspect boat prior to shipping any
        changes will be at the expense of the purchaser. Builder will
        make every effort to take pictures and keep purchaser informed
        but can not be responsible in the event purchaser wants changes
        after shipment, purchaser waives any remedy as to cosmetic
        and/or mechanical changes in the event no inspection is made.

        Any dispute as to the validity of such complaints or objections,
        or as to the parties’ respective responsibilities concerning same
        or the within Purchase Agreement, shall be settled by
        arbitration. Should arbitration become necessary either party
        may serve upon the other notice requiring the matter to be
        arbitrated and such notice shall set out the name of the arbitrator
        appointed by the party giving such notice. Within seven (7) days
        of the receipt of such notice the other party shall either agree to
        the arbitrator appointed by the party giving the notice or appoint
        its own arbitrator and notify the rst party of the name of same.
        In the event the two arbitrators so appointed cannot agree as of
        the resolution of the complaint or objection, then the two
        arbitrators shall select a third arbitrator and shall thereupon
        proceed with all due diligence to settle the matter. The decision
        of the majority of the arbitrators shall be nal and binding
        upon the parties. Each party shall be responsible for the cost and
        fees of the arbitrator selected by that party. The costs and fees of
        the third arbitrator, if necessary, shall be borne equally by the
        parties. In the event the two arbitrators selected as hereinabove
        provided cannot agree upon a third arbitrator, then the third
        arbitrator, if necessary, shall be appointed by the Daviess Circuit
        Court, Daviess County, Indiana, upon petition by either party.

                                                 ***




Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018       Page 4 of 23
                                     SECTION TWELVE
                                 GOVERNING LAW AND VENUE

              It is agreed that this agreement shall be governed by, construed,
              and enforced in accordance with the laws of the State of Indiana.
              Purchaser and Builder agree that in the event any type of
              litigation should result from the within Purchase Agreement,
              then the exclusive venue of such litigation shall be with the
              Daviess Circuit Court, Daviess County, Indiana.


      Appellants’ App. Vol. 2, pp. 48–51 (emphases added). Graber signed the

      Agreement as President of DYI. Id. at 53.


[4]   After the houseboat was built and delivered to the Purchasers, they found a

      number of alleged defects. The parties attempted to resolve these concerns, and

      even attempted mediation in 2016, but were unable to come to an agreement.


[5]   Despite the clear language of the Agreement requiring arbitration of any claims,

      the Purchasers led suit against the Defendants on June 7, 2017 in Daviess

      Circuit Court. The complaint set forth eight counts against the Defendants. The

      counts against DYI were: breach of contract, breach of a written warranty,

      breach of the implied warranty of merchantability, and breach of the implied

      warranty of tness for a particular purpose. The counts against both DYI and

      Graber were: fraud in the inducement to enter into the Agreement, negligent

      misrepresentation, rescission, and unjust enrichment. Appellants’ App. Vol. 2,

      pp. 13–20.


[6]   On August 22, 2017, the Defendants led a motion to dismiss the Purchasers’

      complaint. The Defendants argued rst and foremost that the entire controversy

      Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018    Page 5 of 23
      was subject to mandatory, binding arbitration and that the trial court should

      dismiss the case with an order to compel arbitration. Appellants’ App. Vol. 2, p.

      36. The Defendants also argued that the integration clause in the Agreement

      prevented any claim based on Graber’s oral statements regarding the

      houseboat; that the claim alleging a breach of the written warranty failed to

      state a claim upon which relief could be granted; that the Purchasers’ claims

      against Graber were improper and should be dismissed because they were based

      on oral statements and sought to hold Graber personally liable for the alleged

      faults of DYI; that the Purchasers’ claims for fraud in the inducement, negligent

      misrepresentation, rescission, and unjust enrichment failed to state valid claims

      for relief; that the demand for attorney fees should be dismissed; and that the

      Defendants should instead be awarded attorney fees. Id. at 37–46. Attached to

      their motion, the Defendants submitted a proposed order dismissing the

      Purchasers’ claims with prejudice. After the Purchasers led a response to this

      motion, the Defendants led a surreply.


[7]   The trial court held a hearing on the motion to dismiss on November 13, 2017.

      At this hearing, counsel for the Defendants repeated the claims made in their

      motion: that the entire suit was subject to arbitration and, in the alternative, that

      the Purchasers’ claims failed as a matter of law. With regard to the claims

      against Graber personally, defense counsel argued:


              Now further, we also believe this arbitration agreement applies
              to Sheldon Graber as an individual as President of DYI at all
              times. As the arbitration provision, sorry, as the arbitration
              provisions of the agreement should require that all claims in

      Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018       Page 6 of 23
                 this matter against DYI be heard in arbitration, so should all
                 Claims against Sheldon Graber, because Sheldon has been
                 acting as President of DYI, and interacting with the plaintiffs. He
                 was acting as President of DYI, during any discussions about the
                 construction of this houseboat. Because the plaintiffs and DYI
                 have intended to arbitrate disputes between them, for the a,
                 sorry, between them the arbitration agreement should also
                 extend to plaintiffs[’] claims against Graber’s actions as they
                 allege he took those actions and did not allege that he took those
                 actions in any capacity other than as President of DYI. If such
                 agents, such as a President of a company that has entered into an
                 arbitration agreement are not extended the bene t of the
                 arbitration provisions, then it would be all too easy for crafty
                 litigants to feed and [sic] arbitration agreement by naming non
                 signatories as parties. By naming non signatories in their
                 individual capacity only, plus all defendants in both their of cial
                 and individual capacities must have the bene t of the arbitration
                 clause that they entered into. Per the integration provisions of
                 this agreement also of our plaintiffs[’] claims, we believe that
                 the arbitration agreement alone in the arbitration provisions
                 should cause this matter to be dismissed, but if the Court nds
                 otherwise I believe the integration provisions of this agreement
                 bar any claims based on an alleged promise of a ride high boat. . .


      Appellants’ App. Vol. 3, pp. 43–44 (emphases added). At the conclusion of the

      hearing, the trial court took the matter under advisement.

[8]   On November 15, 2017, the trial court granted the motion to dismiss, using the

      order submitted by the Defendants,1 which provided:




      1
          Compare Appellants’ App. Vol. 2, p. 60 with id. at 92.


      Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018         Page 7 of 23
               This matter, having come before the Court upon Defendants’
               Motion to Dismiss Complaint and the Court GRANTS the
               same.

               IT IS THEREFORE ORDERED, ADJUDGED AND
               DECREED, that this cause of action is dismissed with
               prejudice.


       Appellants’ App Vol. 2, p. 92 (emphasis added).


[9]    On January 12, 2018, the Purchasers led a notice of arbitration claim. Both

       parties then proceeded with the selection of the arbitrators,2 and participated in

       a conference call on January 29, 2018, during which the parties agreed to

       certain procedures and scheduling for the arbitration, and the arbitration was

       set to take place on June 18–22 of that year. See id. at 108. Pursuant to this

       agreed-upon schedule, the Purchasers led an arbitration complaint on

       February 7, 2018, presenting claims substantially similar to the ones it presented

       in their complaint with the trial court, except that the count alleging unjust

       enrichment was replaced with a count seeking to pierce the corporate veil.


[10]   On February 22, 2018, the Defendants led with the arbitrators a motion to

       dismiss the arbitration proceedings, arguing for the first time that the trial

       court’s order dismissing the Purchasers’ claims with prejudice was a judgment

       on the merits that barred further litigation on the issues. Also on February 22,

       Graber led a motion objecting to the arbitrator’s jurisdiction over him. In



       2
        The arbitrators selected were: D. Timothy Born of Terrell, Baugh, Salmon & Born, LLP; Richard A. Young
       of Kightlinger Gray, LLP; and Richard L. Norris of Norris Choplin Schroeder, LLP.

       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018                       Page 8 of 23
       direct contradiction with his arguments to the trial court that the claims against

       him were subject to arbitration, Graber now claimed that the arbitrators had no

       jurisdiction to hear any complaints against him because he was not a party to

       the Agreement. The arbitrators denied these motions on March 16, 2018.


[11]   In the meantime, the Purchasers, on March 8, 2018, led in the trial court a

       motion to correct error or, in the alternative, a motion for relief from judgment.

       The Purchasers argued that the trial court order dismissing their complaint with

       prejudice was improper because the trial court should have either stayed the

       proceedings or dismissed the complaint without prejudice. The Defendants

       countered that the trial court’s dismissal order was a nal judgment on the

       merits, that the time had passed to timely le a motion to correct error, and that

       the Purchasers had not shown grounds for relief under Trial Rule 60. After

       brie ng by both parties, the trial court entered an order granting the Purchasers’

       motion, which provided in relevant part:


               This matter is before the Court on Plaintiffs’ Motion to Correct
               Error or In the Alternative, for Relief from Order. The Court,
               being duly advised, nds as follows:

               1. The Plaintiffs led their complaint herein on June 7, 2017
               alleging several theories of recovery. In the “Prayer for Relief”
               they sought the following:

                    (a) Judgment in Plaintiffs’ favor and against Defendants for
                    rescission and damages in the amount suf cient to
                    compensate Plaintiffs for damage sustained;




       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018        Page 9 of 23
             (b) Return of all monies paid or, in the alternative, all
             applicable damages pursuant to 2-714 of the Commercial
             Code and all incidental and consequential damages;

             (c) Incurred and need cost of repairs;

             (d) All attorneys’ fees, witness fees, expenses, court costs and
             other fees incurred by Plaintiffs; and

             (e) Any and all other just and proper relief in the premises.

        2. Plaintiffs did not speci cally request relief in the form of an
        order requiring the parties to participate in binding arbitration.

        3. It is the trial court’s opinion that Plaintiffs are not entitled to
        any relief from the trial court other than an order requiring the
        parties to participate in binding arbitration. In essence, the trial
        court does not have jurisdiction to address the merits of the case
        or grant relief thereon. Pursuant to the terms of the contract,
        the relief previously requested by Plaintiffs can only be
        awarded through arbitration.

        4. For this reason the trial court granted Defendants[’]
        Motion to Dismiss with Prejudice, essentially determining that
        the trial court could not, pursuant to the terms of the contract
        itself, address any of the issues raised by the Complaint on their
        merits. In essence, the Plaintiffs’ sole remedy under the contract
        was to seek binding arbitration in accordance with the terms of
        the contract to address the merits.

        5. The Defendants have apparently misinterpreted the Court’s
        order assuming that it was a judgment in their favor on the
        merits. It was not. It was intended merely to dismiss the legal
        action assuming that the parties would thereafter participate in
        binding arbitration to resolve the matter on the merits as
        required by the contract. Defendants, instead, apparently
        asserted their position that the dismissal of the law suit was a
        determination on the merits and have made it known that they
        do not intend to participate in arbitration.

Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018         Page 10 of 23
               6. Defendants[’] decision to refuse to participate in binding
               arbitration, if that is their intention, is made at their own risk.

               7. In order to be clear, and so as to not prejudice either party
               by any misunderstanding that may have been created as a result
               of the trial court entering an order that did not clearly state all
               of the above, the court will grant Plaintiffs’ motion for relief
               from the judgment as set forth below.

               8. Justice requires that this relief be granted.

               IT IS THEREFORE ORDERED that Plaintiffs are granted relief
               from the judgment herein as follows:

               1. The order dismissing the matter with prejudice dated
               November 15, 2017 is set aside.

               2. In its place the trial court orders as follows:

               The Plaintiffs Shirley Pierce and/or Al Burnham shall have thirty
               days from the date of this order to amend the “Prayer for Relief”
               in their complaint to seek the sole remedy available to them
               through the trial court, that is an order requiring the parties to
               participate in binding arbitration. If Plaintiffs do not amend the
               complaint accordingly in the time permitted then the Court shall
               enter an order dismissing the complaint.


       Appellants’ App. Vol. 2, pp. 9–10.


[12]   On April 26, 2018, the Defendants led a motion to stay the arbitration pending

       appeal, which the trial court denied on May 2, 2018. The Defendants then led

       a notice of appeal on May 7, 2018, and subsequently led a motion to stay with




       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018          Page 11 of 23
       this court. The motions panel of this court granted the motion to stay by order

       issued on May 29, 2018.3 This appeal ensued.


                                         Discussion and Decision
[13]   The Defendants claim that the trial court erred in several respects when it

       granted the Purchasers’ motion to correct error/motion for relief from

       judgment. First, they argue the trial court could not have properly granted the

       motion under Trial Rule 59 because the time limit for ling a motion to correct

       error had passed. Second, they argue that the trial court could not have properly

       granted the motion under Trial Rule 60(A) because the alleged problems with

       the trial court’s dismissal order were not clerical, but substantive. The

       Defendants next argue that the Purchasers did not establish any grounds for

       relief under Trial Rule 60(B). Lastly, the Defendants argue that the Purchasers’

       claims against Graber are not subject to arbitration. Assuming arguendo that we

       agree with the Defendants with regard to their arguments regarding Trial Rule

       59 and Trial Rule 60(A), we nevertheless believe that the trial court was within

       its discretion to grant relief from its earlier order under Trial Rule 60(B). We

       also conclude that the Defendants, having expressly argued before the trial

       court that the claims against Graber were subject to arbitration, cannot now be

       heard to argue otherwise.




       3
           The Defendants also led a motion to expedite this appeal, which our motions panel denied.


       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018                            Page 12 of 23
                                     I. Indiana Policy Favors Arbitration

[14]   Before turning to the merits of the parties’ arguments, we first note that Indiana

       has long recognized a strong policy favoring the enforcement of arbitration

       agreements. Koors v. Steffen, 916 N.E.2d 212, 215 (Ind. Ct. App. 2009); see also

       MPACT Const. Grp., LLC v. Superior Concrete Constructors, Inc., 802 N.E.2d 901,

       905 (Ind. 2004) (citing PSI Energy, Inc. v. AMAX, Inc., 644 N.E.2d 96, 98 (Ind.

       1994) (writing that “Indiana was surely among the rst jurisdictions to sanction

       arbitration as a means of dispute resolution,” referring to a territorial statute

       enacted prior to statehood in 1816 authorizing and regulating arbitrations)).4


[15]   The current statute controlling orders to arbitrate provides in relevant part:


                  (a) On application of a party showing an agreement described in
                  section 1[5] of this chapter, and the opposing party’s refusal to
                  arbitrate, the court shall order the parties to proceed with
                  arbitration. Ten (10) days notice in writing of the hearing of such
                  application shall be served personally upon the party in default. If
                  the opposing party denies the existence of the agreement to
                  arbitrate, the court shall proceed summarily to the determination
                  of the issue raised without further pleading and shall order
                  arbitration if found for the moving party; otherwise, the
                  application shall be denied.

                  (b) On application, the court may stay an arbitration proceeding
                  commenced or threatened on a showing that there is no
                  agreement to arbitrate. Ten (10) days notice in writing of the


       4
           See The Laws of Indiana Territory, ch. XXXII (1807) (“An Act authorising and regulating arbitrations.”).
       5
        Section 1 generally provides that “[a] written agreement to submit to arbitration is valid, and enforceable,
       an existing controversy or a controversy thereafter arising is valid and enforceable, except upon such grounds
       as exist at law or in equity for the revocation of any contract.” Ind. Code § 34-57-2-1(a).

       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018                             Page 13 of 23
         hearing of the application shall be served personally upon the
         party in default. Such an issue, when in substantial and bona de
         dispute, shall be forthwith summarily determined without further
         pleadings and the stay ordered if found for the moving party. If
         found for the opposing party, the court shall order the parties to
         proceed to arbitration.

         (c) If an issue referable to arbitration under the alleged
         agreement is involved in an action or proceeding pending in a
         court having jurisdiction to hear applications under subsection
         (a), the application shall be made in that action or proceeding.
         Otherwise and subject to section 17 [6] of this chapter, the
         application may be made in any court with jurisdiction.

         (d) Any action or proceeding involving an issue subject to
         arbitration shall be stayed if an order for arbitration or an
         application for an order for arbitration has been made under
         this section . . . , or, if the issue is severable, the stay may be with
         respect to the issue only. When the application is made in such
         an action or proceeding, the order for arbitration must include
         such a stay.

         (e) An order for arbitration shall not be refused on the ground
         that the claim in issue lacks merit or bona des or because any
         fault or grounds for the claim sought to be arbitrated have not
         been shown.

         (f) If the court determines that there are other issues between the
         parties that are not subject to arbitration and that are the subject
         of a pending action or special proceeding between the parties and
         that a determination of such issues is likely to make the
         arbitration unnecessary, the court may delay its order to arbitrate




6
 Section 17 provides, “The term ‘court’ means any circuit or superior court. The making of an agreement
described in section 1 of this chapter providing for arbitration in Indiana confers jurisdiction on the court to
enforce the agreement under and to enter judgment on an award thereunder.” Ind. Code § 34-57-2-17.

Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018                                Page 14 of 23
                until the determination of such other issues or until such earlier
                time as the court speci es.

                (g) On application the court may stay an arbitration proceeding
                on a showing that the method of appointment of arbitrators is
                likely to or has resulted in the appointment of a majority of
                arbitrators who are partial or biased in some relevant respect. The
                court shall then appoint one (1) or more arbitrators as provided in
                section 4[7] of this chapter.


       Ind. Code § 34-57-2-3 (emphases added).


[16]   Accordingly, once the court is satis ed that the parties contracted to submit

       their dispute to arbitration, the court is required by statute to compel

       arbitration. Capitol Const. Servs., Inc. v. Farah, LLC, 946 N.E.2d 624, 628 (Ind.

       Ct. App. 2011) (citing Ind. Code § 34-57-2-3(a)). “However, [Indiana Code

       section 34-57-2-3] does not specify the proper disposition of the litigation upon

       such a determination.” Indiana CPA Society, Inc. v. GoMembers, Inc., 777 N.E.2d

       747, 750 (Ind. Ct. App. 2002); accord Koors, 916 N.E.2d at 215.


[17]   In GoMembers, we noted that Indiana courts had historically either stayed or

       dismissed litigation subject to arbitration under such circumstances without

       explaining why either course was appropriate. Id. at 752 (citing Albright v.

       Edward D. Jones & Co., 571 N.E.2d 1329, 1334 (Ind. Ct. App. 1991) (noting that

       trial court stayed litigation), trans. denied; Northwestern Mut. Life Ins. Co. v.



       7
         Section 4 provides that, if the arbitration agreement does not specify the method of appointing arbitrators,
       and if the parties cannot agree upon such appointment, or if the agreed method fails, or if the appointed
       arbitrator fails to act or is unable to act, the trial court has the duty and power to appoint arbitrators. Ind.
       Code § 34-57-2-4.

       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018                                Page 15 of 23
       Stinnett, 698 N.E.2d 339, 343 (Ind. Ct. App. 1998) (holding that trial court

       should have granted motion to dismiss where issue was subject to arbitration);

       Wilson Fertilizer & Grain, Inc. v. ADM Mill. Co., 654 N.E.2d 848, 849 (Ind. Ct.

       App. 1995) (holding that trial court properly dismissed action and ordered

       parties to proceed to arbitration), trans. denied). In GoMembers we concluded:


                Both of the analytical approaches developed by other courts have
                merit and may in fact often lead to the same result. However, we
                  nd that a superior resolution is to allow trial courts to
                exercise their discretion to either stay or dismiss litigation
                based on the nature of the contested issues that should first be
                submitted to arbitration. By utilizing this discretion, courts may
                examine the facts and circumstances of each case to determine
                the most prudent course of action. Factors which the trial court
                may wish to consider include whether court intervention will be
                necessary to compel discovery, whether the arbitration award
                will be enforced through the court, whether the entire
                controversy is arbitrable, which state’s substantive law will be
                applicable to the controversy, and the location of the parties and
                the evidence.


       Id. at 752 (emphasis added).8


             II. Trial Court Should Not Have Dismissed the Complaint With
                                         Prejudice

[18]   Here, the Defendants argue that the trial court’s action of dismissing the

       Purchasers’ complaint with prejudice acted as a judgment on the merits that



       8
        In referring to the dismissal of litigation, we presume that the GoMembers court was referring to a dismissal
       without prejudice, as a dismissal with prejudice would generally constitute a judgment on the merits that
       would bar any further litigation by way of the doctrine of res judicata. See infra.

       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018                              Page 16 of 23
       bars any attempt at arbitration. To be sure, it is well settled that a dismissal with

       prejudice is generally a dismissal on the merits, and as such it is conclusive of

       the rights of the parties and res judicata as to the questions which might have

       been litigated. Lakeshore Bank & Tr. Co. v. United Farm Bureau Mut. Ins. Co., 474

       N.E.2d 1024, 1027 (Ind. Ct. App. 1985) (opinion on rehearing). Thus, by

       entering an order dismissing the Purchasers’ claims with prejudice, the trial

       court effectively ended the dispute between the parties.


[19]   However, the trial court, as indicated in its ruling on the Purchasers’ motion to

       correct error/motion for relief from judgment, did not intend for the

       controversy to be ended by its dismissal order. Rather, the trial court intended

       that the case proceed to arbitration. Indeed, the parties, including the

       Defendants initially, proceeded to prepare for arbitration. Pursuant to Indiana

       Code section 34-57-2-3(d), the proper course of action under these

       circumstances would have been for the trial court to have stayed the action

       pending the outcome of the arbitration, or dismiss the action without prejudice.

       See GoMembers, 777 N.E.2d at 752. The trial court instead dismissed the

       complaint with prejudice. The Defendants argue that, regardless of the trial

       court’s intentions, the trial court could not undo its previous dismissal with

       prejudice by way of a motion to correct error or a motion for relief from

       judgment.


[20]   Assuming arguendo that the Defendants are correct that the trial court could not

       grant relief under Trial Rule 59 or Trial Rule 60(A), we agree with the



       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018       Page 17 of 23
       Purchasers that the trial court was within its discretion to grant relief under

       Trial Rule 60(B)(1).


         III. The Trial Court Did Not Abuse Its Discretion in Granting Relief
                         from Judgment Under Trial Rule 60(B)(1)

[21]   Indiana Trial Rule 60(B) provides in pertinent part:


               Mistake – Excusable neglect – Newly discovered evidence –
               Fraud, etc. On motion and upon such terms as are just the court
               may relieve a party or his legal representative from a judgment,
               including a judgment by default, for the following reasons:

                     (1) mistake, surprise, or excusable neglect;

                                                          ***

               The motion shall be led within a reasonable time for reasons
               (5), (6), (7), and (8), and not more than one year after the
               judgment, order or proceeding was entered or taken for reasons
               (1), (2), (3), and (4). A movant ling a motion for reasons (1), (2),
               (3), (4), and (8) must allege a meritorious claim or defense. A
               motion under this subdivision (B) does not affect the nality of a
               judgment or suspend its operation. This rule does not limit the
               power of a court to entertain an independent action to relieve a
               party from a judgment, order or proceeding or for fraud upon the
               court. . . .


[22]   The burden is on the movant to establish grounds for Trial Rule 60(B) relief. In

       re Paternity of P.S.S., 934 N.E.2d 737, 740 (Ind. 2010). A motion made under

       Trial Rule 60(B) is addressed to the “equitable discretion” of the trial court. Id.

       at 740–41. Accordingly, the grant or denial of a Trial Rule 60(B) motion will be

       disturbed only when that discretion has been abused. Id. at 741. A trial court


       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018      Page 18 of 23
       abuses its discretion only when its action is clearly against the logic and effect of

       the facts before it and the inferences which may be drawn therefrom. Id. An

       abuse of discretion will not have occurred so long as there exists even slight

       evidence of mistake, surprise, or excusable neglect. See Stemm v. Estate of Dunlap,

       717 N.E.2d 971, 974 (Ind. Ct. App. 1999).


[23]   In the present case, the Defendants do not dispute that the Purchasers’ motion

       was filed within the required one-year timeframe or that the Purchasers have

       alleged a meritorious defense. Thus, the only question before us is whether the

       trial court was within its discretion to conclude that the Purchasers established

       grounds for relief for the reasons of mistake, surprise, or excusable neglect. 9


[24]   Under the facts and circumstances of the present case, we conclude that the trial

       court was well within its discretion to grant the Purchasers relief from the

       dismissal order pursuant to Trial Rule 60(B)(1), i.e., for the reason of “mistake,

       surprise, or excusable neglect.” Here, it is apparent that all of the parties, at

       least initially, understood the trial court’s dismissal order as not precluding

       arbitration, otherwise there would have been no reason for the parties to

       proceed with the arbitration process and go as far as to select the arbitrators.

       When the Defendants claimed that the arbitration was precluded by the trial




       9
        The Purchasers also argue that they were entitled to relief from judgment under Trial Rule 60(B)(3). Since
       we agree with them that they are entitled to judgment under Trial Rule 60(B)(1), we need not address their
       argument under Rule 60(B)(3).

       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018                            Page 19 of 23
       court’s dismissal order, it is clear that the Purchasers (and the trial court) were,

       at the least, surprised by the sudden reversal in course.


[25]   The Defendants argue that if there was a mistake in the trial court’s order, it

       was a mistake on the part of the trial court, and that the proper method of

       addressing such a mistake was to file a direct appeal. See Kretschmer v. Bank of

       Am., N.A., 15 N.E.3d 595, 600 (Ind. Ct. App. 2014) (noting that a Trial Rule

       60(B)(1) motion is not a substitute for a direct appeal and does not attack the

       substantive, legal merits of a judgment, but rather addresses the procedural,

       equitable grounds justifying the relief from the finality of a judgment), trans.

       denied (citing In re Paternity of P.S.S., 934 N.E.2d at 740). Here, the issue is not

       so much a mistake on the part of the trial court, but the surprise in how the

       Defendants initially treated the trial court’s order as not precluding arbitration

       for weeks, only to claim the exact opposite and argue that it did preclude

       arbitration. Certainly, the trial court was within its equitable discretion to

       consider the totality of the circumstances before it and conclude that its earlier

       order should be modified to clarify that its order of dismissal did not intend to

       preclude arbitration. For these reasons, we cannot say that the trial court

       abused its considerable discretion in such matters when it granted the

       Purchasers’ motion for relief from judgment and ordered the parties to proceed

       with arbitration. See 4 William F. Harvey, Indiana Practice, Rules of Procedure

       Annotated § 60.1 (3d ed. 1999) (noting that the equitable power of a court of

       general jurisdiction is “very substantial.”).




       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018        Page 20 of 23
           IV. Graber Cannot Now Argue That the Claims Against Him Are
                              Not Subject to Arbitration

[26]   Graber argues that the trial court erred to the extent that it ordered the claims

       against him to proceed to arbitration. Graber claims that he was not a party to

       the Agreement and that the arbitration clause thereof should not apply to him.

       Unfortunately for Graber, this is exactly the opposite of what his counsel

       argued before the trial court in the motion to dismiss. As noted above, Graber’s

       counsel explicitly argued that the claims against Graber had to be dismissed in

       the trial court because of the arbitration clause of the Agreement:


               [W]e also believe this arbitration agreement applies to Sheldon
               Graber as an individual as President of DYI at all times. As the
               arbitration provision, sorry, as the arbitration provisions of the
               agreement should require that all claims in this matter against
               DYI be heard in arbitration, so should all Claims against
               Sheldon Graber[.]


       Appellants’ App. Vol. 3, p. 43.


[27]   Graber argues that the statements of counsel cannot alter the provisions of the

       Agreement. That much is true, but Graber cannot now be heard to argue that

       the claims against him cannot be heard by the arbitrators, as that is precisely

       what he requested from the trial court. Whether viewed in terms of invited




       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018     Page 21 of 23
       error10 or judicial estoppel,11 we cannot say that the trial court erred in ordering

       the claims against Graber to proceed to arbitration.


[28]   This is not to say that the arbitrators must conclude that Graber is liable for the

       actions of DYI. Our holding is limited to only require the claims against Graber

       to be heard by the arbitrators. See Wilson Fertilizer & Grain, 654 N.E.2d at 853

       n.4 (“Once the [trial] court determines that a dispute is subject to arbitration, all

       additional concerns, including issues regarding the merits of the underlying

       claim or procedural arbitrability, are for the arbitrator.”).


                                                     Conclusion
[29]   When the trial court determined that the arbitration provisions of the

       Agreement required the Purchasers’ claims to be subject to mandatory, binding

       arbitration, the court should have ordered the parties to proceed with arbitration

       and either stayed the proceedings or dismissed the claims without prejudice.

       Instead, the trial court dismissed the claims with prejudice. Despite this fact,

       however, the parties proceeded with the arbitration process to the point of

       selecting the arbitrators. It was only after this point that the Defendants argued

       for the first time that the trial court’s earlier order dismissing the Purchasers’

       claims with prejudice was a final judgment on the merits that barred arbitration



       10
          Under the doctrine of invited error, which is grounded in estoppel, a party may not take advantage of an
       error that she commits, invites, or which is the natural consequence of her own neglect or misconduct. Witte
       v. Mundy ex rel. Mundy, 820 N.E.2d 128, 133 (Ind. 2005).
       11
         “Judicial estoppel is a judicially created doctrine that seeks to prevent a litigant from asserting a position
       that is inconsistent with one asserted in the same or a previous proceeding.” Morgan Cty. Hosp. v. Upham, 884
       N.E.2d 275, 280 (Ind. Ct. App. 2008), trans. denied.

       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018                               Page 22 of 23
       of these claims. Under these particular facts and circumstances, the trial court

       was within its equitable discretion to grant the Purchasers relief from its earlier

       order under Trial Rule 60(B)(1). Moreover, because Graber explicitly argued to

       the trial court that the claims against him should be dismissed and subject to

       arbitration, he cannot now be heard to argue the exact opposite. Accordingly,

       the judgment of the trial court is affirmed.12


[30]   Affirmed.


       Bailey, J., and Bradford, J., concur.




       12
         We also decline the Purchasers’ request to award appellate attorney fees under Appellate Rule 66(E). Even
       though we affirm the trial court, the Defendants’ appellate arguments are far from being “permeated with
       meritlessness, bad faith, frivolity, harassment, vexatiousness, or purpose of delay.” Thacker v. Wentzel, 797
       N.E.2d 342, 346 (Ind. Ct. App. 2003).

       Court of Appeals of Indiana | Opinion 18A-CT-1057 | October 19, 2018                            Page 23 of 23
