Couple not entitled to attorney fees under Crime Victims Relief Act

The Indiana Court of Appeals has affirmed that a Lake County couple who won a fraudulent misrepresentation judgment against the previous owners of the couple’s home are not entitled to certain fees under the Indiana Crime Victims Relief Act.

Joseph and M. Carmen Wysocki sued Barbara and William Johnson, individually and as trustees of the Barbara A. Johnson Living Trust, after discovering electrical and structural issues in their home shortly after purchasing it from the trust in 2006. An inspection report did not reveal the issues, and the Johnsons signed a real estate disclosure form that said there were no such issues with the house.

The case wound its way through the court system, making it to the Indiana Supreme Court, which remanded the case to reevaluate the Wysockis’ fraudulent misrepresentation claim, which was premised upon the allegation that the Johnsons made false statements on the disclosure form. The Indiana Court of Appeals had ruled the Wysockis failed to show that the Johnsons had actual knowledge of the defects and reversed judgment in favor of the Wysockis.

On remand, the trial court ruled in favor of the Wysockis but denied their request for attorney and expert fees under the CVRA, leading to this appeal in Joseph and M. Carmen Wysocki v. Barbara A. and William T. Johnson, both individually and as Trustees of the Barbara A. Johnson Living Trust, 45A03-1309-CT-385.

The Wysockis essentially want the Court of Appeals to create a bright-line rule that the CVRA is applicable in instances where a seller is held liable for false or incomplete statements in their disclosure forms. Focusing on just attorney fees, the Court of Appeals affirmed the trial court, noting its conclusion applies with equal force to other fees recoverable under the CVRA.

Judge Ezra Friedlander pointed out the elements of common-law fraud and the criminal offense of fraud are different, so it cannot be said that authorization of attorney fees in the CVRA for victims of criminal offenses that can be categorized as fraud extends to the common-law tort of fraud.”

“Simply put, in its current form, the CVRA authorizes certain fees only for victims of certain, specific criminal offenses, as well as for liability arising under I.C. § 24-4.6-5 et seq., which does not apply here. The Wysockis were not victims of the criminal offense of fraud because the Johnsons were not charged with that crime in relation to the sale of the house, much less convicted of it in a court of law. In the absence of such a conviction, the CVRA does not apply.”