[CITE: Davies v. Powers d/b/a Powers Logging & Hanover Ins. Co., 12 CADDNAR 297 (2011)]
[VOLUME 12, PAGE 297]
Cause #: 10-033F
Caption: Davies v. Powers d/b/a Powers Logging & Hanover Ins. Co.
Administrative Law Judge: Jensen
Attorneys: pro se (all parties)
Date: March 10, 2011
FINAL JUDGMENT
1. Davies is entitled to an administrative judgment against Powers in the amount of $49,192.98.
2. Davies is entitled to an administrative judgment against Hanover in the amount of $16,397.66. However, Hanover has no liability to Davies except to the extent Powers fails to satisfy the judgment against him.
3. To the extent Hanover is required to satisfy the judgment it may seek indemnification from Powers as authorized by law or contract.
4. This administrative judgment addresses all issues of damage and responsibility; after completion of the opportunity for judicial review under Indiana Code § 4-21.5, this judgment may be enforced in a civil proceeding as a judgment.
PROCEDURAL BACKGROUND:
1. On February 1, 2010, Johnny O. Davies (Davies), filed correspondence (hereinafter referred to as “Complaint”) with the Natural Resources Commission (Commission), wherein he alleged that Respondent, Scott Powers d/b/a Powers Logging (Powers), had removed timber from Davies’ property under a contact executed on October 16, 2008 without making payment for the timber removed.
2. Davies’ Complaint further joined Hanover Insurance Company (Hanover), who issued a bond to Powers.
3. The instant proceeding was initiated under Indiana Code §§ 25-36.5, commonly referred to as the “Timber Buyers Statute”, and 312 IAC 3-14.
4. Procedurally, Indiana Code §§ 4-21.5-3 and 312 IAC 3 govern the instant proceeding.
5. The Natural Resources Commission (“Commission”) is the “ultimate authority” as defined at Indiana Code § 4-21.5-1-15 for proceedings initiated under Ind. Code § 25-36.5 and 312 IAC 14. 312 IAC 14-1-2(d).
6. The Commission possesses jurisdiction over the subject matter of this proceeding and over the parties.
7. A prehearing conference was conducted on October 8, 2010 at which time Davies and Powers appeared. Hanover failed to appear for the prehearing conference.
8. During the prehearing conference, Powers was advised by the administrative law judge that under 312 IAC 3-1-4(a), all allegations made against him were automatically deemed denied. However, Powers persisted in his admission of all allegations made by Davies. See “Report of Prehearing Conference, Notice of Judgment of Liability Against Scott Powers d/b/a Powers Logging in Favor of Johnny O. Davies, Order Regarding Submission of Written Evidence as to the Amount of Liability and Notice of Proposed Default as to Hanover Insurance Company”.
9. As a result of Powers’ admission of the allegations contained within Davies’ Complaint, the administrative law judge entered a Judgment of Liability against Powers and in favor of Davies on October 12, 2010.
10. Following Hanover’s failure to appear for the October 8, 2010 prehearing conference a notice of proposed default was issued on October 12, 2010. Id.
11. Hanover failed to respond to the proposed default and a final order of default was entered against Hanover on November 19, 2010. See “Final Order of Default”.
12. On the agreement of Davies and Powers a schedule was established by which Davies and Powers were afforded an opportunity to submit written evidentiary material as to the amount of Powers liability to Davies. Davies’ evidentiary submission was made timely. Powers presented no evidence.
FINDINGS OF FACT:
13. On October 16, 2008, Davies and Powers executed a Timber Contract by which Powers was authorized to harvest “50 trees guaranteed $15,000 dollars to land owner John Davies.” Timber Contract, Davies Affidavit.
14. Powers has never compensated Davies in accordance with the Timber Contract.
15. Powers harvested 49 white oak, 1 black oak and 2 black walnut trees from Davies’ property. Affidavit of Duane McCoy. The timber harvested from Davies’ property bear a stumpage value of $16,397.66. Id.
CONCLUSIONS OF LAW:
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16. As a result of the Final Order of Default entered against Hanover and in favor of Davies, the amount of Hanover’s liability to Davies will be determined without further involvement of Hanover. 312 IAC 3-1-9(e).
17. The trees harvested by Powers are “timber”. Indiana Code § 25-36.5-1-1.
18. Powers, as a person engaged in the business of buying timber, is a “timber buyer”. Indiana Code § 25-36.5-1-1.
19. Davies, who is the owner of the land upon which the timber was harvested by Powers, is a “timber grower”. Indiana Code § 25-36.5-1-1.
20. Davies is a proper person to bring the instant action against Powers and Hanover as a result of Powers failure to pay for timber acquired pursuant to the Timber Contract. Indiana Code § 25-36.5-1-3.2(b) & (c).
21. Powers is potentially liable to Davies for “damages in compensation for damage actually resulting from the wrongful activities… and damages equal to three (3) times the stumpage value of any timber that is wrongfully cut or appropriated without payment.” Indiana Code § 25-36.5-1-3.2(f).
22. Hanover’s potential liability to Davies is limited to the stumpage value of the timber appropriated without payment. Indiana Code § 25-36.5-1-3.2(g).
23. Powers appropriated timber from Davies without payment.
24. The Commission is possessed of discretion in determining the appropriateness of awarding treble damages and has determined that “such discretion may most appropriately be applied where the timber buyer or timber cutter acts with all due diligence….” Martin v. Curtis & Teague, 11 CADDNAR 53 (2007), citing Gallien v. Sloan Logging, Pendley & Zurich North American, 9 CADDNAR 40 (2002).
25. Powers offered no evidence in this proceeding. Therefore, no evidence exists to support any conclusion that Powers ever attempted to compensate Davies for the timber harvested. Furthermore, Powers’ demeanor at the prehearing conference reflected that he had neither the means nor intention to compensate Davies in the future.
26. There exists no evidence in the record upon which it is appropriate to exercise any discretion to award less than full treble damages, or three (3) times the stumpage value of the timber at issue.