IN RE: the Estate of Michael A. Porter (2025)

MEMORANDUM DECISION

Statement of the Case

[1] In this interlocutory appeal, Paula Hardin requests review of the trial court's order that (1) removed her as the personal representative of the Estate of Michael A. Porter (the Estate) and; (2) appointed a new special administrator to distribute the Estate's funds, among other duties. Hardin argues the trial court erred in calculating payments she was owed from the Estate and in removing her as personal representative. Concluding the trial court did not err, we affirm.

Issues

[2] Hardin raises three claims, which we restate as:

I. Whether the trial court abused its discretion in calculating the value of Hardin's equitable interest in a house owned by the Estate;

II. Whether the trial court abused its discretion in removing Hardin as personal representative; and

III. Whether the trial court abused its discretion in calculating Hardin's fee for her work as personal representative.1

Facts and Procedural History

[3] In 2010, Michael Allen Porter (Michael A.) and his then-wife, and Paula Hardin (Hardin) and her then-husband, executed a real estate installment contract in which Hardin agreed to buy Michael A.’s house for $130,000.² Hardin provided a down payment of $6,600 and agreed to pay off the remaining amount in monthly payments, plus interest, over a thirty-year period.

[4] Michael A. had received the house from his mother, subject to a mortgage debt that was originally $42,620 when the mortgage took effect in 2003. Under the contract, Michael A. was barred from mortgaging his interest in the house. But a handwritten clause in the contract also provided that Michael A. agreed to provide “proof of current mortgage” upon Hardin's request. Appellant's App. Vol. II, p. 34. There is no evidence that Hardin ever requested information about a mortgage.

[5] On March 23, 2015, Michael A. died intestate. Five months later, Hardin petitioned to be appointed personal representative of his Estate. She claimed the house she was purchasing was the Estate's only asset, and Michael A. had three heirs, including his son, Porter. The court granted Hardin's petition. Hardin later testified that her only interest as personal representative was in protecting her investment in the house.

[6] Next, Hardin moved to “complete the contract.” Id. at 30. She claimed that she had discovered the existence of the mortgage only after Michael A. had died, and someone needed to make mortgage payments. Hardin requested permission to pay off the mortgage and then continue paying off the land sale contract. The trial court granted Hardin's motion.

[7] In a 2016 status report to the court, Hardin stated she had made mortgage payments for the house, and a lump-sum payment to avoid foreclosure, but the remaining balance was $27,691.62. Over the next several years, Hardin failed to file periodic status reports with the trial court.

[8] In 2019, Porter filed a petition to appoint a special administrator. He claimed he recently learned that his father had owned another property, and it had been sold at a tax sale. Porter asked the court to appoint a special administrator to secure any surplus from the tax sale and distribute it to Michael A.’s heirs. He did not ask the court to discharge Hardin as personal representative. The court appointed a special administrator over Hardin's objection.

[9] The special administrator collected the tax sale surplus and distributed it to Michael A.’s heirs. Hardin did not make any claim on the tax sale proceeds. In 2022, the administrator filed a report, and the court discharged him from further service.

[10] Meanwhile, Hardin continued to fail to file status reports with the court. In January 2023, Hardin failed to appear for a status hearing, and the court issued a warrant for her arrest.

[11] Later in 2023, Hardin moved to sell the house, claiming that a sale was necessary because the mortgagor was foreclosing on the mortgage and her financial situation had changed due to a recent divorce. She told the court that she still owed $113,000 on the land contract, and an exhibit to her motion showed the mortgage had a balance due of $23,979, plus fees and court costs. She also provided a market analysis of the house, which stated it was in “rough” condition. Id. at 85. It showed signs of “obvious neglect” inside and out, including ceiling stains in two bedrooms from roof leaks. Id.

[12] Porter did not object to selling the house, but he argued that Hardin had no right to the proceeds and alleged that she had a conflict of interest as both the personal representative and the holder of an equitable interest in the house. The court granted Hardin's motion. As part of the sale process, the court authorized Hardin to take out a $15,000 loan to avoid foreclosure again.

[13] After the house sold, the parties disputed how the proceeds should be distributed. The $15,000 loan was paid off, along with the mortgage and various encumbrances on the house that we discuss below. In a November 21, 2023 order, the court ordered the closing agent to distribute the remaining proceeds among the Estate, Hardin, and Hardin's attorney. The court determined Hardin was entitled to $7,430.25.³ The closing agent did not pay Hardin because the proceeds were deposited with the trial court clerk.

[14] In March 2024, Porter moved to remove Hardin as personal representative, to appoint a special administrator, and to distribute the Estate's remaining funds to him and the other heirs. Hardin objected and filed a motion for payment of personal representative fees.

[15] After an evidentiary hearing, the court issued an order on August 2, 2024 that: (1) removed Hardin as personal representative; (2) appointed a new special administrator for the estate; (3) directed the special administrator to pay Hardin $1,000 for her work as personal representative; (4) directed the special administrator to pay Hardin $7,430.35 as ordered in the November 2023 order; (5) directed the special administrator to distribute to Porter his one-third share of the remaining estate; and (6) directed the special administrator to search for other heirs and file periodic reports. This interlocutory appeal followed.

Discussion and Decision

I. Valuation of Hardin's Equitable Title

[16] Hardin argues the trial court miscalculated the money to which she is entitled for her equitable interest in the house.⁴ In general, we review interlocutory orders under an abuse of discretion standard. Steingart v. Musgrave, 221 N.E.3d 725, 729 (Ind. Ct. App. 2023) (quotation omitted). An abuse of discretion occurs when the trial court's decision is clearly against the logic and effect of the facts and circumstances, or the court has misinterpreted the law. Id. “When we review for an abuse of discretion, we do not reweigh the evidence.” Brightpoint, Inc. v. Pedersen, 930 N.E.2d 34, 38 (Ind. Ct. App. 2010), trans. denied.

[17] “Under a typical conditional land contract, the vendor retains legal title until the total contract price is paid by the vendee, but equitable title vests in the vendee at the time the contract is consummated.” Cook v. City of Indianapolis Through Dept. of Pub. Safety, 559 N.E.2d 1201, 1203 (Ind. Ct. App. 1990). During trial court proceedings, Porter did not dispute that Hardin was entitled to payment for her equitable interest, but the parties presented different valuations. Hardin told the court her equitable interest was worth $41,533.15, based on amounts she had paid under the contract plus amounts she had paid on the mortgage. By contrast, Porter told the court Hardin's equitable interest was worth $7,430.35, based on the amount he concluded she had paid under the contract and the mortgage ($20,910.75) minus the value of various encumbrances on the house that the Estate paid off at the closing of the sale of the house ($13,480.40). The trial court accepted Porter's calculation.

[18] There is evidence to support the court's decision. Hardin made some payments on the mortgage, including a lump-sum payment to avoid foreclosure. But in 2016, the mortgage balance was $27,691.62, and seven years later, at the time the house sold, the balance was $23,979. She made little progress in reducing the mortgage. In fact, Hardin had to take out a loan of nearly $15,000, with the court's permission, to keep the house from falling into foreclosure again before sale. And that loan was repaid with proceeds from the sale.

[19] Similarly, Hardin made little progress in paying the balance due on the contract. By the time the house sold in 2023, she still owed $113,000 on the $130,000 price. Furthermore, the encumbrances on the house, which the Estate paid off at the time of sale, were not for the benefit of the Estate. They included Hardin's payment to her ex-husband for his interest in the house, payments of cash judgments and medical bills, and satisfaction of book rental liens from the local school system. Finally, Hardin had promised in the contract to keep the house in good repair, but by the time of sale it showed signs of substantial neglect, including multiple roof leaks. In summary, the trial court neither imposed a forfeiture upon Hardin nor effectively rescinded the contract, contrary to Hardin's argument. Instead, the court chose between two presentations of the evidence. That choice was within the court's discretion. Cf. Morris v. Weigle, 383 N.E.2d 341, 342-44 (Ind. 1978) (purchaser entitled to full recovery of installment payments because purchaser had paid “substantial amount” on contract price and maintained value of property).

II. Removal as Personal Representative

[20] Hardin claims the trial court should not have removed her as personal representative of the Estate. This court will not interfere with the removal of a personal representative absent an abuse of discretion. Matter of Estate of Runyan, 557 N.E.2d 1353, 1356 (Ind. Ct. App. 1990). The governing statute provides, in relevant part:

(b) When the personal representative becomes incapacitated (unless the incapacity is caused only by a physical illness, infirmity, or impairment), disqualified, unsuitable or incapable of discharging the representative's duties, has mismanaged the estate, failed to perform any duty imposed by law or by any lawful order of the court, or has ceased to be domiciled in Indiana, the court may remove the representative in accordance with either of the following:

(1) The court on its own motion may, or on petition of any person interested in the estate shall, order the representative to appear and show cause why the representative should not be removed. The order shall set forth in substance the alleged grounds upon which such removal is based, the time and place of the hearing, and may be served upon the personal representative in the same manner as a notice is served under this article.

Ind. Code § 29-1-10-6(b)(1) (2009).

[21] Hardin claims the trial court's order should be reversed because the court did not specifically explain why removal was necessary. She cites Estate of Sandefur, 685 N.E.2d 719 (Ind. Ct. App. 1997), in support of her claim, but that case is distinguishable. In Sandefur, the Court reversed the trial court's revocation of a special administrator, but not because the trial court failed to make findings. Instead, the Court determined the trial court misapplied the statutes that govern special and general administrators. Id. at 724. The Court also determined the record failed to show that the special administrator met any of the requirements for removal set forth in Indiana Code section 29-1-10-6(b).

[22] By contrast, in the current case the parties litigated Hardin's suitability to continue serving as personal representative, and there is ample evidence that her performance met several of the requirements of Ind. Code § 29-1-10-6. “[O]ne of the basic tenets underlying the procedural provisions in our Probate Code is ‘the uniform and expeditious distribution of property of a decedent.’ ” Markey v. Estate of Markey, 38 N.E.3d 1003, 1007 (Ind. 2015) (quoting Inlow v. Henderson, Daily, Withrow & DeVoe, 787 N.E.2d 385, 395 (Ind. Ct. App. 2003), trans. denied). Hardin opened the Estate in 2015, and the proceedings dragged on until 2023, when she moved to sell the house. In addition, although Hardin was a personal representative without limits on her authority, she admitted she was concerned with only the house she was buying. She ignored other possible assets, and Porter was forced to seek a special representative so that the Estate could obtain the proceeds from the tax sale of a different property Michael A. had owned. This is ample evidence that Hardin mismanaged the Estate.

[23] Turning to the issue of failing to perform duties imposed by the court, Hardin violated several court orders to file status reports and, on one occasion, failed to appear for a status hearing, resulting in the issuance of an arrest warrant. And regarding unsuitability to serve as personal representative, Hardin's sole relationship with Michael A. or any of his heirs was that of buyer and seller. After the Estate sold the house in 2023, and the proceeds were distributed, she had no further interest in the Estate. For these reasons, the trial court did not abuse its discretion when it discharged Hardin as personal representative. See Rigby v. Leister, 261 N.E.2d 891, 893 (Ind. Ct. App. 1970) (trial court did not abuse discretion in removing executor; among other failings, executor failed to inventory the estate's assets, failed to file periodic reports over several years, and did not close estate as promptly as possible).

III. Calculation of Personal Representative Fee

[24] Hardin argues the trial court underpaid her for her work as personal representative, claiming the $1,000 fee was far too low. When a decedent does not state in a will the amount of compensation a personal representative should receive, the court shall authorize payment that is “just and reasonable.” Ind. Code § 29-1-10-13 (1953). “The amount of fees to be awarded is within the trial court's discretion and will not be disturbed absent an abuse of discretion.” Ford v. Peoples Tr. & Sav. Bank, 651 N.E.2d 1193, 1194 (Ind. Ct. App. 1995), trans. denied. In exercising its discretion, the trial court may consider factors including the labor performed, the nature of the estate, difficulties in recovering assets or locating devisees, and the qualifications of the administrator. Id.

[25] Hardin asked the trial court to award her $8,500. But she conceded that her proposed figure was just a guess because she had not kept records of her activities as personal representative. And she admitted that her sole interest as personal representative was in preserving her own investment in the home. Hardin otherwise neglected her duties as personal representative by failing to file status reports, failing to appear for at least one court hearing (causing the trial court to issue a bench warrant), and failing to search for other possible estate assets. Further, until Hardin conceded in 2023 that a sale of the house was necessary, she showed no interest in bringing the Estate proceedings to a reasonably speedy conclusion. And the Estate was not that complex, consisting of only two houses, based on this record. The trial court did not abuse its discretion in granting a $1,000 fee. Cf. Koch v. James, 670 N.E.2d 113, 117 (Ind. Ct. App. 1996) (affirming award of personal representative fees; representative had been diligent and conflict between heirs made resolving the estate more difficult).

Conclusion

[26] For the reasons stated above, we affirm the judgment of the trial court.

[27] Affirmed.

FOOTNOTES

1.   Michael S. Porter (Porter) claims the Court should dismiss this appeal because there is no basis for interlocutory review. Indiana Appellate Rule 14(A) sets forth specific grounds for interlocutory review as a matter of right. Among other grounds, a party may seek interlocutory review of an order “[f]or the payment of money.” Ind. Appellate Rule 14(A)(1). The order at issue here directs the special administrator to distribute to Porter one-third of the Estate's funds. This type of order qualifies as directing the payment of money for purposes of Indiana Appellate Rule 14(A)(1). See Gerth v. Estate of Bloemer, 240 N.E.3d 702, 706 (Ind. Ct. App. 2024) (order directing Estate to distribute funds to heir subject to interlocutory review under Rule 14(A)(1)). We decline to dismiss this appeal.

2.   Neither Michael A. nor Hardin's then-spouses are parties to this case.

3.   Hardin filed a Notice of Appeal, but the Court dismissed the appeal on Porter's motion. Supervised Estate: Paula Hardin v. Michael S. Porter, Case No. 23A-ES-3043 (Ind. Ct. App. Mar. 4, 2024).

4.   The August 2, 2024 order is the subject of this interlocutory appeal, but the trial court originally determined the value of Hardin's equitable interest in its November 21, 2023 order. The November 21 order was the subject of the prior appeal, which the Court dismissed.Porter does not specifically object to Hardin presenting the valuation claim here. We will address the merits of this claim to conserve judicial resources, because it would otherwise have to be addressed in a second appeal after the trial court issues a final judgment.

Baker, Senior Judge.

Judges Bradford and Weissmann concur. Bradford, J., and Weissmann, J., concur.