David Knose, Jr., Appellant-Petitioner v. Nicole Knose, Appellee-Respondent (2025)

MEMORANDUM DECISION

Case Summary

[1] David Knose, Jr. and his then-wife Nicole (Knose) Bland executed a settlement agreement providing that David received as his sole property the parties’ marital residence upon dissolution of their marriage. On appeal, David raises three issues, which we consolidate and restate as: Did the trial court abuse its discretion when it modified the parties’ settlement agreement and ordered David to pay half of the proceeds of any sale of the house to Nicole?

[2] We reverse.

Facts & Procedural History

[3] David and Nicole married in December 2007 and separated in June 2023. They had no children together. On August 1, 2023, David filed a pro se petition for dissolution of marriage and submitted therewith a signed “Settlement Agreement and Decree of Dissolution of Marriage” (the Agreement) for the court's consideration.¹ The Agreement was a pre-printed form document, executed by David and Nicole, providing, among other things, that David “shall retain/take possession and shall become the sole owner of” the marital residence and that he would be responsible for all payments, taxes, and insurance related to that property, and that Nicole would vacate the marital residence. Appendix at 18. The Agreement also reflected that there were no vehicles to divide but did not otherwise address personal property or debt. The court set the matter for a final hearing on October 13, 2023.

[4] David and Nicole appeared in person for the hearing, and the court “walked through” the provisions of the Agreement with them, with each party verbally confirming their agreement with what was reflected in the written Agreement. Transcript at 4. The court also asked them about provisions in the Agreement that had been left blank, such as those pertaining to debt, and each party stated that they intended to be responsible for debt in their own name and that there was no joint debt. The court also inquired about division of personal property, asking “who gets what out of the house,” and David and Nicole were in agreement that Nicole would get everything in the house. Id. at 6. During that discussion, David added that the parties also had agreed he would make a $5,000 payment to Nicole as part of their separation, and she confirmed that they had agreed to such.

[5] The court proceeded to the portion of the Agreement pertaining to the marital residence. After confirming there was a mortgage on the home, the following exchange occurred:

THE COURT: And you're going to – so you're going to take possession of the home?  2

DAVID: Yes.

THE COURT: Is that why the Five Thousand Dollar payment is there as an equalization type payment –

DAVID: Correct.

THE COURT: - because of the home?

DAVID: Just to help her out and move on.

THE COURT: And ma'am, is that your agreement as well?

NICOLE: Yeah.

Id. at 7-8. As for the need for a quitclaim deed, David explained that only his name was on the deed. Nicole then stated that her name was “on the mortgage [ ] part,” but David disagreed and maintained Nicole was not on the mortgage. Id. at 8. The court directed David to refinance the mortgage in twelve months if Nicole's name was on the mortgage. The court concluded the hearing by having each party confirm whether they believed “the division of this marital estate is fair and equitable between the parties,” and each responded in the affirmative. Id. at 10. The court approved the Agreement, incorporating it into the dissolution decree, and dissolved the parties’ marriage on October 13, 2023.

[6] About a month later, on November 27, 2023, Nicole filed a motion asking for a hearing because David still owed her $3520 and, without the money, she was unable to move out of the marital residence by December 13 as they had agreed. David and Nicole appeared for a hearing on December 8, 2023. Although nothing had been included in the Agreement about the $5000 payment, David confirmed that he had agreed on the record at the final hearing to pay Nicole $5000, and the court reduced the outstanding $3520 to judgment. The court also extended the time for Nicole to remain in the house until January 1, 2024.

[7] On March 14, 2024, Nicole filed a second motion asking for a hearing, asserting that David still owed her $3420. The parties appeared for a hearing on April 12, 2024, with Nicole asserting that David had not paid her in full, that she needed the money to get an apartment, and that David was threatening to throw away her personal property still at the house. David responded that Nicole did not move out of the house by January 1 as ordered and had not come to the house to pick up all her belongings. The court ordered Nicole to do so by April 19 and ordered David to make $100 payments to Nicole every other week starting April 19 until paid in full.

[8] On August 13, 2024, Nicole filed a third motion, in which she asked the court to order David to pay the remaining $2520 and requested that she receive “half the money from the house.” Appendix at 26. The parties appeared for a hearing on October 18, 2024. David stated that he had been paying $150 every other week, which was more than ordered. Nicole explained that she needed the $2520 balance and further requested that “[i]f he sells the house, I want half of it,” maintaining that her name “is still on the ․sales disclosure.” Transcript at 35. When the court pointed out that the decree did not provide for her to receive half of any sale proceeds, she testified, “Well, I said it at the beginning and he agreed, then he went back on it when we went and got divorced.” Id.

[9] Nicole called her mother, Susan, as a witness, and the court questioned her, asking if there was anything she wished to state on the issues of the $2520 still owing to Nicole and the request for half of the proceeds from any sale of the house. Susan testified that Nicole could not find an apartment or take care of herself on $100 or $150 every other week and that if David paid Nicole what he still owed of the $5000, she might be able to find a place of her own. She continued:

When [Nicole] first came in here the very first time, she was very upset, distraught because they were getting a divorce. So, she wasn't really thinking straight ․ she was trying to be nice so he wouldn't be mad or give her a hard time. So, I told her ․ [y]ou lived in that house, you took care of that house with him, you need half of it if they sell. That's the way it's supposed to go․ And I think she deserves part of the money of that house․

Id. at 37-38.

[10] David agreed to pay the remaining balance within sixty days but did not agree to Nicole's request for half of proceeds upon sale of the house.³ When the court asked David why he believed he was entitled to all the proceeds for what was a marital residence, he stated the house was in his name, he paid the bills and “took care of [Nicole] and the house,” and, further, “all that was taken care of” in their Agreement and at the final hearing. Id. at 40, 44-45. When the court asked Nicole what the decree provided on the matter, she said, “Well at the beginning we agreed for me to get half the house and then he went back on it when we came here to court.” Id. at 41.

[11] The court explained to the parties that the decree “[will] have to control as to the proceeds of the house.” Id. at 44. After reviewing the decree, the court stated that the matter of the proceeds from the sale of the house “was not addressed.” Id. The court continued that “part of being married is that ․ [b]oth parties own everything” and ordered that when the house is sold “[Nicole] is to receive fifty percent of the proceeds from said sale.” Id. at 45. That day, the court issued a written order consistent therewith, and David filed a motion to reconsider.

[12] David hired counsel, and on November 8, 2024, filed an amended motion to reconsider, asserting that the Agreement provided that David received the marital residence and that Nicole did not allege or prove that she was coerced into signing the Agreement and did not allege or prove fraud. The trial court held a hearing on the motion on December 31, 2024, at which David appeared in person and with counsel, and Nicole appeared pro se, declining any desire for a continuance.

[13] By agreement and court permission, the parties proceeded in summary fashion. David's counsel summarized that Daivd and Nicole had appeared in court at the final hearing to memorialize their Agreement on the record and agreed that the marital house went to David. Counsel argued that the parties’ agreed property division could not be modified absent fraud or duress, which was neither alleged nor proven by Nicole. Nicole maintained that “before we got divorced he asked me what I wanted and I did say fifty percent of the house and he agreed with it. And then when we came to court for our divorce day, he wanted to act like he didn't say it.” Transcript at 52.

[14] Upon examination by David's counsel, Nicole confirmed her signature on the Agreement but maintained that David “was lying” at the October 2023 final hearing. Id. at 54. Nicole acknowledged that, at the final hearing, she did not testify or suggest to the trial court that David was lying or ask the court not to approve the Agreement. She added, however, that she was not in her “right mind” at the time due to “everything [she had] been going through.” Id. at 55. When asked to agree that she waited almost a year to ask the court for a percentage of equity in the home, Nicole replied that she had “wanted it all along” and that they had “agreed to it.” Id. at 56.

[15] Nicole called her mother, Susan, who, upon the court's question, testified, in part:

[Nicole] did say something about getting the money when they come to court the first time. I was with them. She agreed to the Five Thousand Dollars. She was not in her right state of mind. She was upset, crying, hysterical, she didn't know what she was going to do because she had no money. And he knows that. And she has health issues and lots of different things going on․ Her name is on the deed period[.] No matter what was said in court or whatever․[H]e said in court it's his house and his money. Well yeah, he knew she couldn't work. So, yeah, she deserves part of that money․ He should take care of her. I don't say he has to give her every bit of it but ․ she deserves half of it.

Id. at 58.

[16] On January 27, 2025, the trial court issued an order denying the motion to reconsider, determining that “[Nicole], at the October 18, 2024 hearing, proved coercion and fraudulent promises by [David].” Appendix at 31. David now appeals.

Discussion & Decision

[17] Indiana courts have encouraged divorcing couples to resolve their disputes in their own fashion by entering into settlement agreements. Copple v. Swindle, 112 N.E.3d 205, 211 (Ind. Ct. App. 2018). A strong policy favors the finality of marital property divisions, whether the court approves the terms of a settlement agreement reached by the parties or the court mandates the division of the property among the parties. Poppe v. Jabaay, 804 N.E.2d 789, 793 (Ind. Ct. App. 2004), trans. denied, cert. denied (2005). We interpret settlement agreements under a de novo standard. Copple, 112 N.E.3d at 210. Settlement agreements are contractual in nature and binding on the parties once the dissolution court merges and incorporates that agreement into the divorce decree. Id. If the terms are clear and unambiguous, those terms are deemed conclusive. Id.

[18] As our Supreme Court has recently recognized, the Indiana Code forbids courts from modifying property settlement agreement unless the agreement allows for modification, the parties agree post-decree to modify their settlement agreement, or the agreement is tainted by fraud.⁴ Wohlt v. Wohlt, 245 N.E.3d 611, 620 (Ind. 2024); see also Ind. Code § 31-15-2-17 (stating that a property settlement agreement merged into decree is not subject to modification except according to agreement or per the parties’ consent); I.C. § 31-15-7-9.1(a) (stating that property disposition orders may not be revoked or modified except in the case of fraud); Ryan v. Ryan, 972 N.E.2d 359, 362-63 (Ind. 2012) (trial court may not modify a property settlement agreement incorporated into decree absent fraud, duress, or undue influence).

[19] When reviewing a claim that the trial court improperly modified a settlement agreement, we must decide whether the trial court's decision constitutes an abuse of discretion. Dillard v. Dillard, 889 N.E.2d 28, 33 (Ind. Ct. App. 2008) (quoting Poppe, 804 N.E.2d at 793). An abuse of discretion occurs if the trial court's decision is clearly against the logic and effect of the facts and circumstances before the court, or the reasonable, probable, and actual deductions to be drawn therefrom. Id. An abuse of discretion also occurs when the trial court has misinterpreted the law or disregards evidence of factors listed in the controlling statute. Id.

[20] In this case, Nicole did not file a brief. When an appellee does not submit a brief, we do not undertake the burden of developing arguments for that party. Copple, 112 N.E.3d at 210. Instead, we apply a less stringent standard of review and may reverse if the appellant establishes prima facie error. Id. Prima facie error is “error at first sight, on first appearance, or on the face of it.” Id.

[21] At the October 2023 final hearing, David and Nicole each agreed with the provision that David was to receive the marital residence as his sole and separate property. As David notes, “[t]he only point of contention” was the parties’ disagreement about whether Nicole's name was on the mortgage, after which the court ordered David to refinance the mortgage if necessary to remove Nicole's name. Appellant's Brief at 7. Nicole did not offer, or even suggest, at the final hearing that she was deceived or coerced into signing the Agreement. Nor did she indicate that she did not understand it, that she disagreed with it, or that she and David previously had agreed to something else.

[22] It was not until Nicole's third post-dissolution motion, filed ten months after the decree, that she, for the first time, requested half of the proceeds from any sale of the house. At the conclusion of the October 18, 2024 hearing on her motion, the trial ordered that Nicole shall receive fifty percent of the proceeds from the sale of the marital residence. In its order denying David's motion to reconsider, the court found that Nicole had proved “coercion and fraudulent promises” at the October 18, 2024 hearing. Appendix at 31. We cannot agree.

[23] At the hearing, Nicole testified that “at the beginning” and “before [they] got divorced,” she told David she wanted half of the house and he agreed, but that David “went back on it” when they came to court. Transcript at 35, 41; see also id. at 52 (Nicole testifying at hearing on motion to reconsider that “before [they] got divorced,” David had agreed to her request for “fifty percent of the house” but later, at the final hearing, he “act[ed] like he didn't say it”). What this reflects is that David may have been but was no longer agreeable to giving Nicole half of the equity the house. It does not reflect, however, that Nicole signed the Agreement without full knowledge of or consent to its contents. Nor does it show that she was coerced into executing the Agreement. While Susan testified that Nicole could not support herself or find an apartment on $150 every other week and that Nicole deserved half of the money from the house, Susan's testimony did not evince fraud or coercion by David.

[24] As to the trial court's statement at that hearing that the matter of proceeds from the sale of the house “was not addressed” in the Agreement, thereby suggesting it was omitted or not complete, we find that this mischaracterizes the Agreement. Transcript at 44. Given that the house unambiguously went to David under the Agreement, there was no need for the Agreement to address any division of proceeds if and when the house was sold at some point. That is, the matter of the proceeds from sale of the house was not mistakenly or erroneously omitted from the Agreement; it simply was unnecessary to include any discussion about the sale of the house.

[25] In sum, the record indicates that, even if David initially agreed to give Nicole half of the house proceeds if/when it sold, as she claimed, he changed his mind and decided he was not going to do so. And Nicole nevertheless agreed to that property division. Even if the resulting circumstances of the Agreement turned out to be unfortunate or unfair, we are constrained by the law and find that, on the record before us, David has established prima facie error that the trial court abused its discretion when it modified the parties’ Agreement and ordered him to pay Nicole half of the proceeds from the sale of the house. See e.g., Copple, 112 N.E.3d at 213 (finding that the trial court erred when it modified the decree and terminated Father's obligation to pay the marital residence debt where “Father did not allege, and no evidence was produced to prove, Mother had fraudulently procured the agreement, placed Father under duress, or used undue influence”); Dillard, 889 N.E.2d at 33 (finding trial court's modification of division of proceeds from sale of marital residence was abuse of discretion for failure to meet I.C. § 31-15-2-17’s requirements for modification of property settlement agreement).

[26] Judgment reversed.

FOOTNOTES

1.   Until otherwise noted, the parties proceeded pro se in the dissolution of marriage proceedings

2.   The Agreement did not include, nor was there any testimony about, the value of or any equity in the marital residence.

3.   As of the October 2024 hearing, the house had not been sold. Id. at 44.

4.   Fraud may be actual or constructive; constructive fraud does not require an intent to deceive. Wohlt v. Wohlt, 245 N.E.3d 611, 620 (Ind. 2024). The five elements to establish constructive fraud are: (1) the defendant owed a duty of candor to the plaintiff based on their relationship; (2) the defendant breached that duty by either making a material misrepresentation of a past or existing fact or by remaining silent despite a duty to speak; (3) the plaintiff reasonably relied on the statement or omission; (4) the misrepresentation proximately caused the plaintiff injury; and (5) the defendant gained an advantage at the plaintiff's expense through the misrepresentation. Id.

Altice, Chief Judge.

Pyle, J. and DeBoer, J., concur.