LLC v. Heather Simpson, et al., Appellees-Plaintiffs (2026)

MEMORANDUM DECISION

Case Summary

[1] Magenta Homes LLC (Magenta Homes) and Efraim Argaman ¹ (collectively, Magenta) bring this interlocutory appeal following the trial court's denial of Magenta's motion to compel arbitration with regard to Heather—a real estate agent—and Jhared Simpson's (collectively, the Simpsons) claims against it for fraud, negligence, and breach of warranty and breach of contract. Magenta contends that the trial court erred because the contracts executed by the parties entitled it to proceed to arbitration under the Indiana Uniform Arbitration Act (IUAA).²

[2] We reverse and remand with instructions.

Facts and Procedural History

[3] On April 5, 2023, the Simpsons entered into a Purchase Agreement with Magenta to purchase a newly constructed home (the Residence) in Indianapolis. Pursuant to an Addendum to the Purchase Agreement (the Addendum), Magenta agreed to purchase a supplementary limited home

[4] warranty (the RWC Warranty) from the Residential Warranty Company, LLC (RWC) for the Simpsons’ benefit.

[5] The Addendum, executed on May 2, 2023, included the following language: “[I]f the above [RWC]Warranty is validated ․ Purchaser acknowledges and understands that the [RWC] Warranty includes a provision requiring all disputes that arise under the [RWC] Warranty to be submitted to binding arbitration.” Appellants’ Appendix Vol. 2 at 69 (emphasis added). Both parties signed the Addendum.

[6] The Addendum further stated that “Purchaser has received or otherwise been provided access to a sample warranty book and has read and understood the limited warranty administered by [RWC].” Id. RWC provided the parties with a warranty book (the Warranty Book) containing the terms and conditions of the warranty on June 9, 2023, following the execution of the Addendum. The Warranty Book included a “Notice of Waiver of Implied Warranty” that stated:

The Limited Warranty is made pursuant to Indiana Statutes 32-27-2-1 to 32-27-2-10 regarding statutory warranties on new home construction and is provided in lieu of all other express or implied warranties. To the extent permitted by law, the purchaser of this home and all subsequent purchasers hereby waive all other express and implied warranties, which may be greater than the express warranties provided herein. Those warranties have been replaced by this express insurance backed warranty, which I understand. I voluntarily agree to waive and disclaim all other warranties.

Id. at 75.

[7] On June 14, 2023, the parties jointly submitted an application to RWC, and Magenta paid the warranty fee. The parties signed the application acknowledging that “this warranty includes a provision for binding arbitration.” Id. at 73. The Simpsons also initialed the application in a section that provided, “by signing your initials in the space provided, you acknowledge that you have carefully read and understand the section in your warranty book explaining arbitration procedures.” Id. (emphasis added).

[8] At the time of the sale, Magenta provided the Simpsons with a Seller's Residential Real Estate Sales Disclosure (the Seller's Disclosure), indicating that there were no defects in the Residence. During their first year there, however, the Simpsons found numerous problems with the workmanship in the Residence. When the Simpsons contacted RWC about those issues, they were instructed to communicate with Magenta in light of its obligations during the first two years of the Simpsons’ ownership of the Residence.

[9] On March 25, 2024, the Simpsons contacted Magenta about a leaking toilet that needed repair. Thereafter, the Simpsons hired an inspection company to determine the full scope of defective materials and workmanship at the Residence. On May 29, 2024, the Simpsons provided Magenta with a Notice of Claim (Notice) pursuant to Ind. Code § 32-27-3-2 ³ (the Construction Claim Statute) and with an inspection report from Irongate Inspection Services that identified the alleged defects in the Residence. In accordance with the Construction Claim Statute, Magenta was afforded twenty-one days to respond. Magenta acknowledged receipt of the Notice and engaged its own company to inspect the Residence. Although an inspection was performed on July 17, 2024 with the Simpsons’ consent, Magenta did not provide the Simpsons with a copy of the report. Magenta took no action to remedy the alleged defects, and it stopped communicating with the Simpsons.

[10] The Simpsons filed an amended complaint against Magenta Homes and Argaman individually on December 2, 2024 ⁴ , alleging breach of contract, breach of warranty, fraud, negligence, and breach of the implied warranty of habitability. Thereafter, Magenta filed a motion to dismiss the Simpsons’ complaint, citing the arbitration clause in the RWC Warranty and the Addendum.

[11] After the trial court denied the motion to dismiss, Magenta answered the complaint, denying the allegations, and asserted counterclaims against the Simpsons. Magenta further alleged unjust enrichment regarding funds that it had provided to repair items at the Residence.

[12] On November 20, 2025, Magenta filed a motion to compel arbitration, along with a request to stay the proceedings, alleging that the RWC Warranty and arbitration agreement therein required the parties to arbitrate the dispute because they all related to the Simpsons’ purchase of the Residence. The Simpsons opposed Magenta's motion on the grounds that the RWC Warranty violated I.C. § 32-27-2-9 (the Disclaimer of Implied Warranties Statute), that the parties had consented to the jurisdiction of the trial court, and that the claims advanced against Argaman individually do not relate to the RWC Warranty.

[13] The trial court summarily denied Magenta's motion, and Magenta thereafter filed a Notice of Appeal. We dismissed the appeal on December 17, 2025, for lack of jurisdiction because the trial court's order was not a final judgment and it was neither an interlocutory appeal of right nor a proper discretionary interlocutory appeal. After Magenta filed a petition for rehearing of this court's order, however, we reinstated the appeal on February 20, 2026.

[14] Additional information will be provided as necessary.

Discussion and Decision

[15] Magenta contends that the trial court erred in denying its motion to compel arbitration and the motion to stay the proceedings because the arbitration terms in the contracts involving Magenta, the Simpsons, and RWC unambiguously required the trial court to order the matter to arbitration.

[16] A trial court's decision on a motion to compel arbitration is reviewed de novo. Decker v. Star Fin. Grp., Inc., 204 N.E.3d 918, 921 (Ind. 2023). The party seeking to compel arbitration carries the burden of showing the existence of an enforceable arbitration agreement. Land v. IU Credit Union, 218 N.E.3d 1282, 1287 (Ind. 2023).

[17] There is a strong policy favoring arbitration agreements. Decker, 204 N.E.3d at 920. The IUAA provides in part that “on application of a party showing an [arbitration] agreement, and the opposing party's refusal to arbitrate, the court shall order the parties to proceed with arbitration․” I.C. § 34-57-2-1. “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.” I.C. § 34-57-2-3. Additionally, “a party seeking to compel arbitration must satisfy a two-pronged burden of proof. First, the party must demonstrate the existence of an enforceable agreement to arbitrate the dispute. Second, the party must prove that the disputed matter is the type of claim that the parties agreed to arbitrate.” Safety Nat'l Cas. Corp. v. Cinergy Corp., 829 N.E.2d 986, 1000 (Ind. Ct. App. 2005) (internal citations omitted), trans. denied. Once the court is satisfied that the parties contracted to submit their dispute to arbitration, “the court is required ․ to compel arbitration.” Id.

[18] In determining whether a dispute falls within the provisions of an arbitration agreement, we examine the contract's plain language. Progressive Se. Ins. Co. v. Empire Fire & Marine Ins. Co., 88 N.E.3d 188, 195 (Ind. Ct. App. 2017). When construing arbitration agreements, “every doubt is to be resolved in favor of arbitration.” Estate of King v. Aperion Care, 155 N.E.3d 1193, 1194 (Ind. Ct. App. 2020), trans. denied.

[19] It is possible for a party entitled to arbitration to waive that right, and that decision is also reviewed de novo. Prof'l Constr. v. Historic Walnut Square, 224 N.E.3d 352, 357 (Ind. Ct. App. 2023). Whether a party has waived the right to arbitration depends primarily on whether that party has acted inconsistently with its right to arbitrate. MPACT Const. Grp., LLC v. Superior Concrete Constructors, Inc., 802 N.E.2d 901, 910 (Ind. 2004). More specifically, courts examine “a variety of factors, including the timing of the arbitration request, if dispositive motions have been filed, and/or if a litigant is unfairly manipulating the judicial system by attempting to obtain a second bite at the apple due to an unfavorable ruling in another forum.” Finlay Props. v. Hoosier Contracting, LLC, 802 N.E.2d 453, 455 (Ind. Ct. App. 2003). Our courts have permitted arbitration in many instances where the issues have not been “fully litigated” in the trial court. See e.g., Progressive Se. Ins. Co., 88 N.E.3d at 198 (remanding the case for the trial court to enter an order compelling the entire dispute to arbitration even though both parties moved for summary judgment and the trial court had ruled on the cross motions).

[20] In this case, the parties’ agreement to arbitrate unambiguously applies to the circumstances at hand. The contract specifies that arbitration is the sole recourse for “an Unresolved Warranty Issue,” which is defined in the contract. Appellant's Appendix Vol. 2 at 96. An “Unresolved Warranty Issue” pertains to “[a]ll requests for warranty performance, demands, disputes, controversies, and differences that may arise between” the Simpsons and Magenta. Id. at 100. The claims asserted by the Simpsons in their complaint all relate to “disputes,” “controversies,” and/or “differences” between them and Magenta about the quality of the work that was performed at the Residence. This language is broad, and when construed toward resolving every doubt in favor of arbitration, the claims asserted by the Simpsons are within the agreement to arbitrate.

[21] Notwithstanding these terms, the Simpsons maintain that arbitration is not appropriate because a disclaimer of the implied warranty of habitability is void and against public policy. Thus, the Simpsons argue that the case should remain in the trial court.

[22] We reject the Simpsons’ claim, as the question of whether the language in the RWC Warranty improperly disclaimed the implied warranty is an issue to resolve through arbitration rather than through the courts. In other words, because the Simpsons are not attacking the validity of the arbitration provisions in the RWC Warranty, they cannot avoid application of the arbitration requirement. See, e.g., Brumley v. Commonwealth Business College Educ. Corp., 945 N.E.2d 770, 778 (Ind. Ct. App. 2011) (holding that because the plaintiffs do not allege a fraudulent inducement of the arbitration clauses, the dispute between the parties falls within the intended purview of their executed arbitration provisions and their claims remain arbitrable).

[23] Also, while the Simpsons maintain that their claims against Argaman individually cannot proceed to arbitration, he is the principal and officer of Magenta who purchased the RWC Warranty that contained the arbitration agreement that he and Magenta Homes are relying on to compel arbitration. Our Supreme Court has made it clear that “contracting parties, or those in privity with them, have rights under an arbitration agreement.” Doe v. Carmel Operator, LLC, 160 N.E.3d 518, 522 (Ind. 2021). And we agree with the rationale that because a corporation acts through its agents and employees, “an arbitration agreement would be of little value if it did not extend to them.” Bel-Ray Co. v. Chemrite Ltd., 181 F.3d 435, 444 (3d Cir. 1999). The claims that the Simpsons asserted against Argaman clearly arise from the transactions that the Simpsons agreed to arbitrate. Thus, the Simpsons cannot avoid the arbitration provision simply because they sued Argaman individually in addition to Magenta Homes.

[24] Finally, the circumstances here do not show that Magenta has waived its right to arbitrate. To be sure, Magenta asserted that right before it filed an Answer to the complaint. And it tentatively moved forward with its counterclaim only after the trial court denied its motion to dismiss. In other words, the record supports Magenta's intent to pursue the matter in arbitration from the outset, and it has continued to maintain that position. Moreover, Magenta has not requested discovery, neither party has taken depositions, and none of the claims have been decided on their merits. To be sure, this case has hardly progressed during its fourteen-month pendency before Magenta filed its Notice of Appeal requesting this court's involvement in seeking arbitration.

[25] In sum, the circumstances here do not suggest that Magenta is attempting to manipulate the system and/or that it is trying to get a second bite at the apple. We therefore conclude that the parties agreed to arbitration, that the Simpson's claims against Magenta are encompassed within that agreement, and that Magenta did not waive its right to arbitrate. Accordingly, the trial court erred in denying Magenta's motion to compel arbitration. Thus, we reverse and remand this case to the trial court with instructions that it stay the proceedings therein and order this dispute to proceed to arbitration.

[26] Reversed and remanded.

FOOTNOTES

1.   Argaman is Magenta Homes's principal and officer.

2.   Indiana has adopted the Uniform Arbitration Act, codified at Ind. Code § 34-57-20-1 through I.C. 34-57-2-22.

3.   The Construction Claim Statute provides, among other things, that “at least sixty (60) days before filing a construction defect action against a construction professional, the claimant must serve written notice of claim on the construction professional. The notice of claim must state that the claimant asserts a construction defect claim against the construction professional and must describe the claim in reasonable detail sufficient to determine the general nature of the defect.” I.C. § 32-27-3-2 (a). The “construction professional” must then serve a written response on the claimant “within twenty-one ․ days after service of [the] notice of claim. I.C. § 32-27-3-2(b).

4.   The initial complaint, filed on September 4, 2024, did not name Argaman as a defendant.

Altice, Judge.

Vaidik, J. and Foley, J., concur.