ATTORNEY FOR APPELLANT: ATTORNEYS FOR APPELLEES:
ROBERT M. BAKER III HARRY L. GONSO
Johnson, Smith, Pence & Heath, LLP MARY NOLD LARIMORE
COURT OF APPEALS OF INDIANA
THE INDIANA HIGH SCHOOL ATHLETIC )
ASSOCIATION, INC. )
vs. ) No. 49A05-9912-CV-00531
JOAN DURHAM, INDIVIDUALLY, and
JOAN DURHAM AS NATURAL PARENT and )
GUARDIAN OF BERNARD L. DURHAM, )
A MINOR, and BERNARD L. DURHAM, )
APPEAL FROM THE MARION SUPERIOR COURT
The Honorable Kenneth H. Johnson, Judge
Cause No. 49D02-9909-CT-001280
May 7, 2001
OPINION - FOR PUBLICATION
The Indiana High School Athletic Association (IHSAA) appeals the trial courts issuance of
a permanent injunction against the IHSAAs denial of full eligibility and a hardship
exception for Bernard Durham (B.J.). The trial court found that the IHSAAs
decision was arbitrary and capricious. Upon appeal, the IHSAA asserts that the
trial courts findings are clearly erroneous, given the broad discretion afforded to its
eligibility decisions. Because we agree that the IHSAAs decision to deny B.J.
full eligibility and a hardship exception was arbitrary and capricious, we affirm the
Facts and Procedural History
In the summer of 1999, B.J. transferred from Park Tudor High School (Park
Tudor) to North Central High School (North Central). B.J. participated in varsity
cross-country and track during his freshman and sophomore years at Park Tudor.
B.J. had attended private school, either at Park Tudor or at St. Richards
School since second grade. B.J. has three brothers who also attended private
During 1998, B.J.s mother, Joan Durham, and her husband, Tim Durham,
separated and initiated divorce proceedings. Tim is not B.J.s biological father.
B.J.s biological father lives in France and does not contribute to B.J.s support.
Around January or February of 1999, the time came to sign 1999-2000
re-enrollment contracts for B.J. and his three brothers in their private schools.
At that time, Joan and Tims divorce was not yet final. Joan
decided not to sign the contracts because she could no longer afford the
tuition to send her children to private schools.
She instead enrolled
her sons including B.J. in the public school system where the family resided,
Washington Township. B.J. enrolled in North Central.
In the fall of 1999, an IHSAA transfer form was completed on behalf
of B.J. so that he could continue participating in sports at North Central.
Joan indicated on the form that the recent divorce created such a
financial burden on her that she could not afford to keep B.J. enrolled
at a private school. Joan also provided the IHSAA with financial information
and court filings to support the listed reason for B.J.s transfer.
In 1997, before the divorce, the taxable income of the family was $405,590.
However, after the separation, Joans taxable income was $134,620, resulting in a
sixty-seven percent drop in the family income. However, Joans substantial debt and
regular expenses greatly reduce the availability of this income. Further, Joan does
not have significant assets that she can access to assist her in reducing
her debt or paying her expenses.
Specifically, there are two mortgages on the family home, the first one is
for $460,000, and the second mortgage is for $130,000. Thus, although the
houses appraisal value is somewhere between $580,000 and $680,000, any proceeds from a
sale of this home would be severely reduced by these mortgages. There
was also a tax lien on the house at the time Joan had
to make the decision of whether or not to re-enroll her children in
private schools. This tax lien also prevented Joan from selling the family
home. Joans yearly fixed bills, including the mortgage and utilities, total over
$96,000. In addition, charges at Park Tudor total $11,895 for tuition, fees,
and books per child. Joan also has many other regular expenses, including
credit cards, insurance, health care, camp, piano and tennis lessons, tutors, and household
expenses such as groceries and landscaping. Further, the child support paid by
Tim for his one child is not received in cash, as it is
applied to paying off the tax lien on the house. Although she
owns stock in the company for which she works, she has borrowed against
that to keep her house. In fact, she receives temporary assistance from
her parents in exchange for some work that she does for them to
enable her to stay in the family home and continue to keep up
payments on her debt.
Park Tudor, as the sending school, also had to offer the
reason for B.J.s transfer. Initially, Park Tudor had included in
the transfer form that B.J. told coaches, administrators, and other students that he
wanted to go to a better track/c.c. [cross-country] program and that is why
he is leaving. Record at 102. B.J. denied making such statements.
However, Park Tudor changed its position after speaking with its athletic director
who had subsequently learned that B.J.s family situation prompted the transfer. Park
Tudor recommended that B.J. be awarded full eligibility to compete in sports at
On August 25, 1999, IHSAA Assistant Commissioner Sandy Searcy granted B.J. only limited
eligibility, which prohibited B.J. from competing at the varsity level, and denied B.J.
a hardship exception.
The Durhams, through North Centrals athletic director, appealed that decision to the IHSAA
Executive Committee. The Durhams were led to believe that the question of
whether B.J. transferred for athletically motivated reasons would not be an issue discussed
at the hearing scheduled before the Executive Committee. A hearing was
held, at which B.J., Joan, and the athletic directors from both schools testified.
Evidence was presented that B.J. had been running with the junior varsity
cross-country team at North Central, and that if he enjoyed full eligibility, B.J.
would be one of the schools top runners. Joan testified that B.J.
had suffered a great deal as a result of the IHSAAs decision.
She relayed that he had problems with anxiety in the past, and that
his running had helped him through this difficult time for his family.
B.J. testified that he did not want to leave Park Tudor, and that
he refused to explain why he was leaving when asked about the move
at Park Tudor. Assistant Commissioner Searcy also testified that she was convinced
that the change in the Durhams financial circumstances was permanent and substantial although
not beyond their control. Park Tudors athletic director, referring to Park Tudors
initial comment on B.J.s transfer form, stated that the reference was the result
of bantering between athletes and coaches due to the rivalry with North Central.
The Executive Committee agreed with Assistant Commissioner Searcys decision, denying B.J. full eligibility
and issuing findings. The Executive Committee concluded that B.J. transferred schools without
a change in residence and failed to fit within any of the criteria
of the Transfer Rule
to gain full eligibility. Further, the Committee determined
that B.J. did not meet the necessary conditions to gain full eligibility through
the hardship exception to the Transfer Rule. Even though Searcy had testified
that there had been a permanent and substantial change in financial circumstances, the
IHSAA Executive Committee reasoned that B.J. failed to produce sufficient proof that the
reason for transfer was beyond the control of him and his family.
The IHSAA also noted that some evidence existed that the transfer may have
been motivated by athletic reasons, even though the Durhams did not know that
this was an issue before the Executive Committee.
The Durhams sought a temporary restraining order in court. On September 17,
1999, the trial court granted the temporary restraining order. On September 20,
1999, B.J. filed the complaint asking that the IHSAAs decision be overturned and
that a permanent injunction be issued to allow B.J. to run cross-country on
North Centrals varsity team. On October 15, 1999, the trial court held
a hearing on the request for injunctive relief. The court allowed the
administrative record to be supplemented, but did not conduct a new evidentiary hearing.
On October 22, 1999, the court granted the permanent injunction, and issued findings
and conclusions. The court found that the IHSAAs findings were arbitrary and
capricious. The court concluded that B.J. had met the conditions of the
hardship exception to the Transfer Rule by showing a significant change in financial
circumstances caused by his mothers recent divorce. The trial court noted that
Joans total expenses before private tuition are about equal to her income.
Moreover, the court reasoned that B.J. did not need to prove poverty status
to fall within the confines of the Hardship Rule, as the IHSAA does
not have an income test. The court instead determined that B.J. did
meet the requirements listed in the Hardship Rule, concluding that allowing B.J. to
enjoy full athletic eligibility would not violate the spirit of the Transfer Rule.
The court noted that the only possible evidence of athletic motivation, the
bantering among students and coaches, was hearsay within hearsay. Further, this evidence
was not confirmed by personal knowledge, but rather was an assumption made due
to a rivalry with North Central. The IHSAA appealed the trial courts
findings. Initially, this court stayed the appeal so that the trial court could
decide the issue of attorney fees. The trial court denied the Durhams
request for attorney fees, and the stay was lifted.
Discussion and Decision
Upon appeal, the IHSAA asserts that the trial court applied the standard of
review over its decisions improperly. The IHSAA contends that its rulings are
entitled to great deference and should be reversed only if they are willful
and unreasonable without consideration of the facts and circumstances in the case.
In this case, the IHSAA argues that the trial court merely reweighed the
evidence and substituted its own decision. The
Durhams insist that this case is moot because the time for the injunction
has expired, and there are no outstanding unresolved issues between these parties.
Alternatively, the Durhams counter that the IHSAAs conduct is not free from judicial
review, and the IHSAA violated its own rules in denying B.J. a hardship
I. IHSAABackground and Rules
The IHSAA is a voluntary association designed to regulate interschool athletic competition.
It establishes standards for eligibility, competition, and sportsmanship. For each school
year, the IHSAA publishes a manual containing its Articles of Incorporation and By-Laws.
This manual contains specific rules regarding eligibility. The rule in question
in this case is Rule 19, known as the Transfer Rule. The
Transfer Rule guides athletic eligibility when a student moves to a new school
district. Rule 19-4 provides that a student will be ineligible for 365
days if he or she transfers schools for primarily athletic reasons. Further,
Rule 19-6.2 gives the IHSAA the authority to grant limited eligibility to a
student who transfers to another school without a corresponding change of residence by
his or her parent(s)/guardian(s). However, if one or more of the criteria
under Rule 19-6.1 are met, then a student may enjoy full and immediate
eligibility, even without a change of residence by his or her parent(s)/guardian(s).
If none of the criteria in Rule 19-6.1 are met, then a student
must fall within the hardship exception to the Transfer Rule to gain full
and immediate eligibility. Rule 17.8, entitled Hardship grants the authority to
set aside any rule, including the Transfer Rule, if certain conditions are met.
In particular, Rule 17-8.1 lists these three conditions:
a. Strict enforcement of the Rule in the particular case will not serve
purpose of the Rule;
b. The spirit of the Rule has not been violated; and
c. There exists in the particular case circumstances showing an undue
would result from enforcement of the Rule.
Further, among those situations to receive general consideration for a hardship exception is
the following: a change in financial condition of the student or a students
family may be considered a hardship, however, such conditions or changes in conditions
must be permanent, substantial and significantly beyond the control of the student or
the students family. IHSAA Manual, Rule 17-8.4.
When a student moves to a new school district, an investigation and a
transfer report must be completed if athletic eligibility at the new school is
desired. Included in this report are forms filled out by the sending
school, the receiving school, and the student and/or the students parent(s)/guardian(s). The
report must include the relevant circumstances and documents and recommendations regarding immediate eligibility
from both schools.
Initially, the Durhams assert that the IHSAAs appeal should be denied because the
case is moot. The Durhams contend that there are no outstanding issues
between the parties because the injunction has been lifted, the issue of attorney
fees has been decided, and North Central did not win any State titles
with B.J.s participation.
However, the IHSAA replies that the problem with the majority of litigation surrounding
eligibility decisions is that the injunction granted by the trial court expires before
the matter has been fully litigated and appealed. The IHSAA also contends
that the case is not moot because its Restitution Rule
allows the IHSAA
to make the school forfeit victories, team awards, and funds received from a
tournament if it has been determined that an ineligible student athlete has competed
for that school. Alternatively, the IHSAA argues that even if the issues
have been decided in this case, this court should hear the case because
it involves questions of public interest.
An issue becomes moot when it is no longer live and the parties
lack a legally cognizable interest in the outcome or when no effective relief
can be rendered to the parties. City of Huntingberg v. Phoenix Natural
Res., Inc., 625 N.E.2d 472, 474 (Ind. Ct. App. 1993). When the
principal questions in issue have ceased to be matters of real controversy between
the parties, the errors assigned become moot questions and the court will not
retain jurisdiction to decide them. Plumlee v. Monroe Guar. Ins. Co., 655
N.E.2d 350, 358 (Ind. Ct. App. 1995), trans. denied. An actual controversy
must exist at all stages of the appellate review, and if a case
becomes moot at any stage, then the case is remanded with instructions to
dismiss. Jordan v. IHSAA, 16 F.3d 785, 787 (7th Cir. 1994).
The Durhams insist that the IHSAA failed to assert evidence that there is
a live controversy. The evidence about how the Restitution Rule may create
a live controversy was introduced only through the Appendix to the IHSAAs Reply
Brief. The Durhams filed a Motion to Strike the Appendix to
the IHSAAs Reply Brief. The IHSAA filed a response, and the Durhams
have asked for leave to file a reply. Further, the IHSAA has
filed a surreply to the motion.
These motions focus on the IHSAAs attachment of an affidavit given by Blake
Ress, the IHSAA Commissioner, to its reply brief. The Durhams assert that
since the affidavit was not part of the trial record and is not
part of the record on appeal, the court should not consider the appendix.
The IHSAA failed to ask for leave to supplement the record, and
the appendix does not include verification under Ind. Appellate Rule 50 that the
contents of the appendix are accurate and a part of the appellate record.
The IHSAA counters that the affidavit was included to address the Durhams argument
in their brief that the case was moot. The IHSAA relies upon
Kieselbach v. Feuer, 183 Ind. 582, 109 N.E. 842, 843 (1915), which stands
for the proposition that [a]n appellate court may receive proof or take notice
of facts appearing outside the record for the purpose of determining the moot
character of a question presented to it. The IHSAA also contends that
the Durhams have misapplied the appellate rules because it is not seeking to
modify or correct the record, but instead to supplement it. Alternatively, the
IHSAA has petitioned the trial court to certify the appendix.
The Durhams respond that the IHSAA is trying to add new evidence to
cure deficiencies in the trial court record, rather than modify it to make
the record accurate. Specifically, the Durhams contend that because the trial record
failed to discuss the IHSAAs Restitution Rule,
the IHSAA is now attempting to
bring it into the record to avoid the doctrine of mootness. The
Durhams also cite Ind. Appellate Rule 32, to assert that the trial court
does not have jurisdiction over this matter. App. R. 32 provides that
although the trial court initially has jurisdiction over correcting and modifying the record,
the Court of Appeals acquires jurisdiction over attempts to modify the record after
the reply brief has been filed in the appeal.
The affidavit of Commissioner Ress contains specific information about B.J.s participation on North
Central athletic teams during the time the injunction was in place. The
affidavit details B.J.s placement in tournaments and competitions, and discusses how North Central,
as a team, would have fared without B.J.s participation. The purpose of
including this information is to prove that there is a live controversy between
these parties because the Restitution Rule would require North Central to forfeit its
team points earned by B.J in competitions. Under the Rule, B.J. would
also have to forfeit individual awards. The affidavit provides the only evidence
in the record that B.J. earned individual ribbons or awards and that North
Central placed higher with B.J.s participation.
Regardless of whether we consider the affidavit, an exception to the mootness doctrine
applies. The IHSAA relies upon the exception that an otherwise moot case
may be decided on the merits if the case involves a question of
great public interest. Indiana courts recognize that a moot case can be
reviewed under a public interest exception when it involves questions of great public
importance. Union Tp. School Corp. v. State ex rel. Joyce, 706 N.E.2d
183, 187 (Ind. Ct. App. 1998), rehg denied, trans. denied. Although Indiana
does not require that the issue be capable of repetition, cases falling into
the public interest exception usually involve issues that are likely to recur.
The IHSAA argues that this exception applies to the instant case
because the issue involves children and education, matters that are considered of great
public concern, and our court has previously held that a challenge to an
IHSAA eligibility rule is an issue of substantial public interest. See IHSAA
v. Raike, 329 N.E.2d 66, 71 n.3 (Ind. Ct. App. 1975). We
While at first glance high school athletics may not seem to
be of great public importance, according to the IHSAA, over 160,000 students statewide
participate in sports under the IHSAA eligibility rules. Thus, this issue touches
many in our state. Further, the issue of eligibility when a student
transfers schools has arisen several times and has been the subject of much
litigation. See also IHSAA v. Carlberg, 694 N.E.2d 222, 228 (Ind. 1997),
rehg denied (recognizing the integral role athletics play in our state constitutionally-mandated system
of education). Also, the specific issue of a student transferring schools after
his or her parents divorce is likely to recur. Therefore, we need
not reach the issue of whether the Motion to Strike the Appendix to
the Appellants Reply Brief should be granted. The public interest exception to the
mootness doctrine applies to this case, allowing us to decide the merits.
III. Were the Trial Courts Findings Clearly Erroneous?
A. Our Standard of Review
The IHSAA asserts that the trial courts findings were clearly erroneous. In
this case, the trial court issued an injunction to prevent the IHSAA from
enforcing its ruling against B.J. When we review an injunction, we apply
a deferential standard of review. IHSAA v. Martin, 731 N.E.2d 1, 5
(Ind. Ct. App. 2000), rehg denied, trans. denied. The grant or denial
of an injunction is discretionary, and we will not reverse unless the trial
courts action was arbitrary or constituted a clear abuse of discretion. Id.
(citing Ind. State Bd. of Pub. Welfare v. Tioga Pines Living Ctr.,
Inc., 637 N.E.2d 1306, 1311 (Ind. Ct. App. 1994), rehg denied).
An abuse of discretion occurs when the trial courts decision is clearly against
the logic and effect of the facts and circumstances or if the trial
court misinterprets the law. Id.
When the trial court granted the injunction in this case, it issued findings
of fact and conclusions. Thus, to determine if the trial court abused
its discretion, we must review these findings and conclusions. Id. Our
review is two-tiered. Wallace v. Meadow Acres Manufactured Hous., Inc., 730 N.E.2d
809, 812 (Ind. Ct. App. 2000), trans. denied. First, we must determine
whether the evidence supports the findings, and then, whether the findings support the
judgment. Id. We will reverse a trial courts findings only if
they are clearly erroneous. Id. at 813. The findings are erroneous
only when the record leaves us with a firm conviction that a mistake
has been made. Id.
B. Did the Trial Court Fail to Apply the Correct Standard of Review
Governing IHSAA Decisions?
The IHSAA argues that the trial court failed to apply the deferential standard
of review afforded to its administrative rulings in granting the Durhams request for
a permanent injunction.
In Carlberg, 694 N.E.2d 222, our supreme court delineated how a trial court
should review an administrative ruling made by the IHSAA. Although the IHSAA
is a voluntary association, the court held that student challenges to IHSAA decisions
are subject to judicial review. Id. at 230. The court reasoned
that student athletes in public schools do not voluntarily subject themselves to IHSAA
rules, and students have no voice in rules and leadership of the IHSAA.
Id. The court then determined that IHSAA decisions are analogous to
government agency decisions and, hence, adopted the arbitrary and capricious standard of review
used when courts review government agency action. Id. at 231. The
arbitrary and capricious standard of review is narrow, and a court may not
substitute its judgment for the judgment of the IHSAA. Id. at 233.
The rule or decision will be found to be arbitrary and capricious
only where it is willful and unreasonable, without consideration and in disregard of
the facts or circumstances in the case, or without some basis which would
lead a reasonable and honest person to the same conclusion. Id. (quoting
Dept of Natural Res. v. Ind. Coal Council, Inc., 542 N.E.2d 1000, 1007
(Ind. 1989), cert. denied, 493 U.S. 1078 (1990)).
In particular, the IHSAA takes issue with the trial courts holding that because
B.J. met all of the criteria for the hardship exception, the IHSAA erred
in denying him one. The IHSAA contends that even if B.J. would
have met all of the criteria listed in the Hardship Rule, Rule 17-8.1,
he is not entitled to mandatory relief. Rather, the IHSAA maintains that
relief under the Hardship Rule is a matter of grace. In other
words, the IHSAA has the discretion of whether to grant a hardship exception
even if the Durhams proved that 1) strict enforcement of the Transfer Rule
will not serve to accomplish the purpose of the Rule, 2) the spirit
of the Transfer Rule has not been violated, and 3) an undue hardship
would result if the Transfer Rule was enforced. The IHSAA bases this proposition
upon a recent unpublished decision in federal court, Pearson v. IHSAA, No. IP
99-1857-C-T/G (S.D. Ind. February 22, 2000), where the court acknowledged the IHSAAs broad
See Appendix to the Appellants Brief A-3. The court in
Pearson stated that the IHSAA was not required to grant a hardship exception
even if all conditions of the hardship rule are met. Appendix A-3
However, the IHSAAs position leaves its administrative decisions denying a hardship exception
free from judicial review of any sort. While the text of the
Hardship Rule states that the IHSAA shall have the authority to set aside
the effect of any Rule, the IHSAAs stance that it can deny a
hardship exception even when the student meets the listed criteria implies both that
it may have no ascertainable standards for granting or denying a hardship and
that its hardship determinations are free from judicial review. IHSAA Manual, Rule
17-8.1. If the IHSAA is truly analogous to a governmental agency, then
it must also establish standards on which to base its decisions.
Our supreme court in Carlberg, established the appropriate standard of review for IHSAA
decisions in no uncertain terms. To reiterate, the Carlberg court stated that
an IHSAA decision is arbitrary and capricious if it is willful and unreasonable,
without consideration and in disregard of the facts or circumstances in the case,
or without some basis which would lead a reasonable and honest person to
the same conclusion. 694 N.E.2d at 233 (citation omitted). The IHSAAs
suggestion that the Hardship Rule is entitled to an increasingly narrow standard of
judicial review flies in the face of the Carlberg decision. In Carlberg,
the supreme court upheld the IHSAAs Transfer Rule in part because there are
provisions in place to lessen the severity of the rule. Id. at
233. The court reasoned that granting immediate and full eligibility either under
the listed exceptions to the Transfer Rule or under the Hardship Rule and
granting limited eligibility at the junior varsity or freshman level serves to balance
the possible harsh effects of the Transfer Rule. Id. If we
accepted the IHSAAs assertion that its decisions to deny a hardship exception fall
under a more stringent standard of review than the arbitrary and capricious standard
enunciated in Carlberg, then we would be taking away one of the underpinnings
of that case.
Thus, we hold that trial courts may determine whether the denial of
a hardship exception in a particular case was the result of arbitrary and
capricious action by the IHSAA. In this case, the trial court did
not fail to give weight to the IHSAAs broad discretion, as the IHSAA
alleges. Rather, in rendering its decision that the IHSAA acted arbitrarily and
capriciously, the trial court looked at the IHSAAs particular decision with respect to
B.J., applied the appropriate standard, and concluded that the IHSAAs conduct rose to
the level of willful and unreasonable decisionmaking that was in disregard of the
facts and circumstances before it. For this, the trial court was well
within its discretion.
C. Were the IHSAAs Findings Clearly Erroneous?
Finally, the IHSAA asserts that even if the trial court used the appropriate
standard of review governing its decisions, the trial courts findings were clearly erroneous.
The IHSAA asserts that the evidence, as adduced in its written findings,
supports its denial of full eligibility and a hardship exception.
In particular, the IHSAA asserts that some evidence existed that B.J. transferred for
athletically motivated reasons. It points to the bantering about North Central having
a better cross-country and track program. The trial court concluded that this
was hearsay within hearsay and was not substantial evidence. The IHSAA counters
that hearsay is admissible during administrative proceedings, and can be found to be
substantial evidence of probative value. See C.T.S. Corp. v. Schoulton, 383 N.E.2d
293, 296 (Ind. 1978); Kriss v. Brown, 390 N.E.2d 193, 197 (Ind. Ct.
App. 1997). The IHSAA also contends that the Durhams failed to establish
that the purpose of the Transfer Rule would not be served by denying
B.J. a hardship exception due to this evidence of school jumping.
Here, the trial court did not abuse its discretion in holding that the
IHSAAs conclusion that there was some evidence supporting that B.J. transferred for athletic
reasons was arbitrary and capricious. Although hearsay may be admissible in administrative
proceedings, this evidence of bantering was based upon Park Tudors mistaken assumption that
B.J. was transferring for athletic reasons. As soon as Park Tudor officials
learned of the Durhams circumstances, the transfer report was corrected to reflect that
they recommended that B.J. be given full eligibility under a hardship exception.
Thus, any evidence of athletic motivation was recanted by Park Tudor. Further,
Park Tudors retraction is against their own interest, as it would seem that
Park Tudor would be interested in not having B.J. compete against it due
to its rivalry with North Central. Despite this, Park Tudor supported B.J.s
pursuit of a hardship exception.
Additionally, the Durhams were led to believe that athletic motivation would not be
an issue in B.J.s case. It is unfortunate that the IHSAA listed
athletic motivation as a reason for transfer even though little or no evidence
supports it. This practice was denounced in Martin, 731 N.E.2d at 11, which
noted that the IHSAA uses the possibility of an athletically-motivated transfer, although admittedly
not primarily athletically motivated, as a poison pill to keep students from receiving
a hardship exception even if there is no substantial evidence to that effect.
In the instant case, the trial court recognized this practice and found
no evidence in the record to support the IHSAAs conclusion that athletic motivation
played a role in B.J.s transfer. Thus, the trial courts findings with
respect to athletic motivation were not clearly erroneous.
Further, the IHSAA argues that B.J. did not establish undue hardship because he
failed to show that his familys circumstances were beyond his or his familys
control and that he could not afford to attend private school. The
IHSAA contends that the trial court merely reweighed the evidence of the familys
finances, and that the Durhams still enjoyed a high standard of living.
The IHSAA concluded that the decision to send B.J. to North Central was
Rule 17-8.1, the general section of the Hardship Rule, states that the IHSAA
may grant a hardship exception if 1) strict enforcement of the rule in
the particular case will not serve to accomplish the purpose of the rule;
2) the spirit of the rule has not been violated; and 3) there
exists in the particular case circumstances showing an undue hardship that would result
from enforcement of the rule. Thereafter, specific circumstances are listed as candidates
for hardship exceptions. One such circumstance that may be considered a hardship
is a change in financial condition of the student or a students family
if the change is permanent, substantial, and significantly beyond the control of the
athlete or the athletes family.
The Seventh Circuit Court of Appeals considered this issue in Crane, 975 F.2d
1315, and held that the IHSAAs denial of full eligibility was arbitrary and
capricious where a student whose parents were divorced had transferred schools after a
change in custody. Id. at 13. The IHSAA has concluded that
the student failed to prove that the move was beyond his control, as
the change in custody occurred after Crane had some discipline problems and trouble
with his grades in school. The Seventh Circuit, finding that this decision
was arbitrary and capricious, reasoned that the IHSAA had ignored the plain language
of its rules and instead used rambling rationalizations to come to a pre-ordained
result. Id. at 1323, 1325. The court noted that the IHSAA
changes its interpretation of its rules depending upon the situation before it.
Id. at 1325.
We also addressed this issue in Avant, 650 N.E.2d 1164 (Ind. Ct. App.
1995). In Avant, we held that the IHSAAs denial of a hardship
exception was supported by the evidence. Id. at 1169. Avant transferred
from a private to a public school, and Avants enrollment at a private
school created a financial hardship on the family. However, the familys financial
situation had not changed, and there was also evidence that Avant had disagreements
with his basketball coach. Further, the familys financial situation was never listed
on the transfer report. Thus, we concluded that the IHSAAs decision to
deny Avant a hardship exception was not arbitrary and capricious. Id.
Unlike Avant, in this case there was a change in the
Durhams family finances due to the divorce, and this change was documented in
the transfer report submitted to the IHSAA. This change was caused by
something beyond their control, Joans recent divorce. Included in the specific list
of situations receiving consideration for a hardship exception is a substantial and permanent
change in financial condition of the student or the students family significantly beyond
the control of the student or the students family. With the evidence submitted
by Joan in the IHSAA administrative proceedings regarding her recent divorce and familys
change in finances, no reasonable and honest person could conclude that the Durhams
have not met this specific consideration listed within the Hardship Rule.
The trial court in the case before us found that the IHSAA ignored
its own rules and instead interjected a condition of undue hardship not found
in its rules that the Durhams prove their poverty before B.J. be given
a hardship exception. We agree.
Contrary to IHSAAs assertion, the Hardship Rule does not read that an athletes
family must prove that it is a hardship case. In fact, financial
hardship or poverty is not contained within the change in financial condition provision
or the Hardship Rule generally. Instead, the hardship referred to in the
Hardship Rule focuses on the hardship faced by the student athlete if the
rule is strictly enforced. In this case, B.J. would face a hardship
if he had to run at the junior varsity level because through no
fault of his own and without any athletic motivation, B.J. was forced to
transfer schools because of a substantial and permanent change in his familys financial
condition. Just as in Crane, the IHSAA is attempting to adjust its
interpretation of the Hardship Rule to meet the particulars of this case.
Even if we were to read a financial hardship requirement into the Hardship
Rule, the Durhams would meet such a condition. The evidence in the
record is undisputed that Joan had a significant amount of debt and her
income had decreased by sixty-seven percent as a result of the divorce.
At first glance, Joans taxable income of $134,620 may not appear to suggest
a family in financial hardship. However, a closer look reveals that Joans
monthly expenses are about equal to her monthly income. Joans mortgage
and utilities total $96,000 yearly, and she has many other regular expenses including
health care, insurance, and various household expenses. Joan also has no assets
that she could access to alleviate her financial burdens. Although Joan may
be able to sell her house, she would net very little in proceeds
after her mortgage debt was satisfied. Further, Joan would like to keep
her children in the family home to avoid more disruption in their lives,
in light of the divorce. The IHSAA should not be in the
business of second-guessing personal financial decisions, but should accept the circumstances as they
Given the evidence in this case, the trial court did not abuse its
discretion in overturning the IHSAAs denial of full eligibility and refusal to grant
a hardship exception. While it may be true that in other cases,
see IHSAA v. Vasario, 726 N.E.2d 325, 333 (Ind. Ct. App. 2000) and
Avant, 650 N.E.2d at 1169, we have recognized the IHSAAs broad discretion in
refusing to grant a student a hardship exception, this discretion is not unreviewable
and is subject to the arbitrary and capricious standard upon review. The
evidence in this case overwhelmingly leads to the conclusion that the reasons the
IHSAA created the Transfer Rule, deterrence of athletic recruiting and equality in competition,
would not be served by denying B.J. a hardship exception. The trial
court did not simply reweigh the evidence and substitute its opinion, but instead
found that the IHSAA ignored the facts and circumstances before it in rendering
its decision. No reasonable and honest person would have concluded that B.J.
should be denied a hardship exception in this case. This case embodies
the reason the Hardship Rule was created. Although the IHSAA contends that
its decisions are virtually unreviewable, a court does have the discretion to identify
arbitrary and capricious conduct. The trial court in this case properly identified
arbitrary and capricious action by the IHSAA.
NAJAM, J., and KIRSCH, J., concur.
Eventually, one brother, who was Tims only biological son, continued attending
private school because Tim was obligated to pay his tuition. Further, another
one of B.J.s brothers went to France to live with his father.
See IHSAA Manual, Rule 19.
The Restitution Rule, Rule 17-6 of the IHSAA By-laws, reads:
If a student is ineligible according to Association Rules but is permitted to
participate in interschool competition contrary to Association Rules but in accordance with the
terms of a court restraining order or injunction against the students school and/or
the Association and the injunction is subsequently voluntarily vacated, stayed, or reversed or
it is finally determined by the court that injunctive relief is not or
was not justified, any one or more of the following action(s) against such
school in the interest of restitution and fairness to competing schools shall be
a. Require individual or team records and performances achieved during participation by such
ineligible student be vacated or stricken;
b. Require team victories be forfeited to opponents;
c. Require team or individual awards earned be returned to the Association; and/or
d. If the school has received or would receive any funds from an Association
tournament series in which the ineligible individual has participated, require that the school
forfeit its share of net receipts from such competition, and if said receipts
have not been distributed, authorize the withholding of such receipts by the Association.
See IHSAA Manual, Rule 17-6.
We note that unpublished trial court decisions do not serve as
precedent for this case and may only be considered for their persuasive value.
See Ind. Dept. of Natural Res. v. United Minerals, Inc., 686 N.E.2d
851, 857 (Ind. Ct. App. 1997), trans. denied.