Court erred in dismissing claim with prejudice

The Indiana Court of Appeals reversed a trial court's dismissal of a woman's claims against her former tenants, finding the court misinterpreted a previous appellate ruling to support the dismissal.

In Peg Zaremba v. Jessica and John Navarez, No. 64A05-0809-CV-254, Peg Zaremba had filed a small claims eviction complaint against the Navarezes, which the court opinion refers to as Cause No. 629. Zaremba failed to appear for the initial hearing and bench trial and her counsel requested a dismissal without prejudice, which was granted.

A few months later, Zaremba filed another claim against the Navarezes for damages, referred to in the opinion as Cause No. 3733. The trial court dismissed her claim with prejudice, ruling Zaremba failed to explain her absence from the initial hearing in Cause No. 629 and didn't file a motion under Trial Rule 60 to set aside the dismissal. The trial court ruled her failure to appear and the dismissal was res judicata. The trial court also denied Zaremba's motion to correct error, finding she failed to appear for trial and noted it is a plaintiff's obligation to seek relief from a dismissal without prejudice under T.R. 60 prior to refilling a case, citing Multivest Properties v. Hughes, 671 N.E.2d 199 (Ind. Ct. App. 1996).

But the trial court erred, both in determining the dismissal of Cause No. 629 served as res judicata and in its interpretation of Multivest. Cause No. 629 was dismissed without prejudice, which wasn't a judgment on the merits. As a result, Zaremba's complaint under Cause No. 3733 wasn't barred by res judicata, wrote Judge Elaine Brown.

The trial court misread what it believed the appellate court held in Multivest, wrote the judge. The Court of Appeals held that Indiana Small Claims Rule 10 is specific and "dismissal with prejudice is contemplated only when the plaintiff fails to appear after the claim has been refiled." Zaremba didn't fail to appear after she refiled her claim. The trial court abused its discretion by dismissing her claim with prejudice and denying her motion to correct error. The Court of Appeals remanded for further proceedings.