VAIDIK, Chief Judge.
In 1955 Northern Indiana Public Service Company (NIPSCO) acquired a 100-foot-wide easement for electrical lines in Porter County. In 2007 NIPSCO filed a complaint for a permanent injunction alleging that its easement — which went across property that was later determined to be held by Duneland Holdings, LLC — had been violated by the previous landowners by mining the sand on the easement, causing difficulties in maintaining and servicing its poles. The trial court ordered that the easement be relocated and that Duneland Holdings pay NIPSCO $245,858 for the costs of reconstructing the power lines on the new easement.
Duneland Holdings now appeals. First, it contends that NIPSCO's failure to mitigate damages is a bar to relief. Second, it contends that the trial court erred in admitting Plaintiff's Exhibit 5 — a material and labor estimate prepared by a long-time NIPSCO engineer for relocating the power lines onto the new easement — into evidence because it is hearsay. Because mitigation of damages is not a defense to liability and NIPSCO in fact mitigated its damages, this issue is not a bar to NIPSCO's recovery. In addition, experts may testify to opinions based on inadmissible evidence, provided that it is of the type reasonably relied upon by experts in the field. Here, NIPSCO's engineer testified that he relied on data from other NIPSCO departments in arriving at his material and labor estimate. The trial court therefore did not abuse its discretion in admitting Plaintiff's Exhibit 5. We affirm the trial court.
NIPSCO is a public utility whose primary purpose is to furnish natural gas and electrical power to northern Indiana, including Porter County. In 1955 NIPSCO acquired a 100-foot-wide easement on property in Porter County in order to install, maintain, operate, repair, and replace towers and poles for the transmission, distribution, and delivery of electrical power to the public. Appellee's App. p. 6-7.
In the 1970s Jerry Lambert became involved with this 374-acre tract of land when he formed a partnership with three other people to operate a sand-mining operation. NIPSCO's easement was properly recorded, and the partners were aware of it. Later, during the 1990s, Lambert acquired all right, title, and interest in the 374-acre tract from the other partners and continued operating the sand mine as a sole proprietor.
In 1999 James Hayward, a NIPSCO engineer, was asked to address the property owner's desire to remove sand near NIPSCO's easement. Hayward visited the property and prepared an estimate to move the power lines to a different location on the property in order to accommodate the property owner's desire to mine sand on NIPSCO's easement. Id. at 101. NIPSCO's estimate was approximately $125,000. Tr. p. 66. Sand excavations did not begin at this time.
In 2000 Lambert created two business entities to further pursue sand mining from the tract of land: Duneland Properties, LLC (which owned the land) and Duneland Sand, Inc. (which operated the sand-mining business). Lambert and his son-in-law, John Durachta, each owned a 50% interest in the entities. Durachta acted as general manager of Duneland Sand until late 2003. During this time, Durachta directed the removal of sand from both the tract of land and NIPSCO's easement. The mining took place over several months. In June 2003 NIPSCO's attorney sent a letter to Durachta directing Duneland Sand to cease and desist its sand mining on NIPSCO's easement:
Appellee's App. p. 56-57. NIPSCO's estimate, prepared in August 2003, showed that the cost of moving the power lines was now $155,389. Def.'s Ex. D.
Although Duneland Sand stopped mining NIPSCO's easement for a period of time following its receipt of the letter from NIPSCO's attorney, it resumed mining NIPSCO's easement in 2006 because Lambert said the sand was "too valuable." Appellee's App. p. 69. Then, in December 2006, Lambert, as President and Managing Member of Duneland Sand and Duneland Properties, respectively, entered into an agreement with Kevin Misch to sell both companies. Pursuant to the agreement, Misch assumed the obligation for the defense of any claim by NIPSCO for Duneland
In October 2007 NIPSCO filed a complaint for a permanent injunction alleging, among other things, that the then-relevant defendants, Duneland Sand and Duneland Properties, while operating a sand mine in Porter County, "encroached upon, wasted and damaged NIPSCO's easement causing it property damage by changing grade and undermining the integrity of its power transmission facilities thereby jeopardizing the reliability of electrical service to the public." Appellee's App. p. 3. NIPSCO therefore requested the court to issue a mandatory injunction "directing the ... defendants to be jointly and severally responsible for fill and moving fill in a timely manner to and around the excavated areas around the NIPSCO towers per NIPSCO's specifications" and "be permanently enjoined from encroaching upon or damaging the property interests of NIPSCO in the continued unencumbered use of its easement for electric transmission or distribution lines as is the subject of its original grant." Id. at 3-4 (quotation omitted). The Duneland Entities then filed a cross-claim against Lambert.
In February 2011 the trial court ordered that the Duneland Entities were permanently enjoined from further encroaching or otherwise committing additional waste within NIPSCO's easement. Appellants' App. p. 24. After numerous court-sponsored settlement discussions, in August 2011 the parties submitted a stipulated order that the court entered. The order states, in relevant part:
Id. at 26. The court reserved its ruling to determine the costs of remediation and the allocation of costs among the parties. Id.
Nearly two years later, in April 2013, the court held a hearing to determine the costs of remediation and how to allocate the costs among the parties. At the hearing, NIPSCO presented the testimony of Timothy Kizer, a state-licensed civil engineer and NIPSCO employee. Kizer testified about the costs of relocating the power lines onto the new 100-foot-wide easement. Kizer talked about Plaintiff's Exhibit 5, which is a material and labor estimate generated by NIPSCO's internal computer software using the current labor index for labor costs and its purchasing ledger for material costs. The estimate, which is for $245,858, was prepared in March 2013.
In May 2013 the court entered findings and conclusions. The court found that NIPSCO did not fail to mitigate its damages by failing to protect its easement during years of obvious Duneland excavation
Id. at 12-13. The court ordered as follows:
The Duneland Entities now appeal.
The Duneland Entities raise two issues on appeal. First, they contend that NIPSCO's failure to mitigate damages is a bar to relief. Second, they contend that the trial court erred in admitting Plaintiff's Exhibit 5 — a material and labor estimate for relocating the power lines onto the new easement — into evidence because it is hearsay.
The Duneland Entities contend that the trial court should have taken into consideration that NIPSCO "fail[ed] ... to protect the easement during years of obvious Duneland excavation into the easement." Appellants' Br. p. 9; see also id. at 10 ("NIPSCO, while warning Duneland and its previous owners as to the fact that they were removing sand from the easement, did nothing until they filed suit some four years after the 2003 estimate and some eight years after the 1999 estimate."). Therefore, their argument continues, NIPSCO's failure to mitigate damages is a "bar to the right of equitable relief." Id. at 7; see also id. at 11 ("The trial court should ... not have given NIPSCO the money judgment that they requested."). However, the Duneland Entities confuse laches, which is a complete bar to recovery, with failure to mitigate damages, which is an affirmative defense that may reduce the amount of damages a plaintiff is entitled to recover after liability has been found.
The principle of mitigation of damages addresses conduct by an injured party that aggravates or increases the party's injuries. Willis v. Westerfield, 839 N.E.2d 1179, 1187 (Ind.2006). Mitigation of damages is not an affirmative defense to liability. Id. Rather, failure to mitigate damages is an affirmative defense that may reduce the amount of damages a plaintiff is entitled to recover after liability has been found. Id. Put simply, a plaintiff in a negligence action has a duty to mitigate his post-injury damages, and the amount of damages a plaintiff is entitled to recover is reduced by those damages that reasonable care would have prevented. Id. The defendant bears the burden of proving that the plaintiff has not used reasonable diligence to mitigate damages. Id. The defendant's burden includes proof of causation, that is, proof that the plaintiff's unreasonable post-injury conduct has increased the plaintiff's harm and, if so, by how much. Id.
In contrast, laches is an equitable defense that may be raised to stop a person from asserting a claim that he would normally be entitled to assert. Ind. Real Estate Comm'n v. Ackman, 766 N.E.2d 1269, 1273 (Ind.Ct.App.2002). The rationale behind the doctrine of laches is that a person who, for an unreasonable length of time, has neglected to assert a claim against another waives the right to assert the claim when this delay prejudices the person against whom he would assert it. Id. Laches requires: (1) inexcusable delay in asserting a known right; (2) an implied waiver arising from knowing acquiescence in existing conditions; and (3) a change in circumstances causing prejudice to the adverse party. SMDfund, Inc. v. Fort Wayne-Allen Cnty. Airport Auth., 831 N.E.2d 725, 729 (Ind.2005).
Here, the evidence shows that NIPSCO mitigated its damages. The trial court's findings recognize as much:
Appellants' App. p. 9. Given this ruling, the Duneland Entities cannot use this appeal to back away from their prior agreement, which included granting NIPSCO "an alternate easement in the form as set forth in Plaintiff's Exhibit 8." Id. at 12. The cost of relocating the power lines onto a new easement is considerably less than restoring the original topography, and was most likely the reason why the Duneland Entities entered into the agreement in the first place. Because mitigation of damages is not a defense to liability and NIPSCO in fact mitigated its damages, this issue is not a bar to NIPSCO's recovery.
The Duneland Entities argue that the trial court erred by admitting Plaintiff's Exhibit 5 — Kizer's material and labor estimate for relocating the power lines onto the new easement — into evidence because it is hearsay. We review a trial court's decision on the admissibility of evidence for an abuse of discretion, which occurs when the decision is against the logic and effect of the facts and circumstances before the court. Weinberger v. Boyer, 956 N.E.2d 1095, 1104 (Ind.Ct.App. 2011), trans. denied. Even where the trial court's decision is erroneous, however, we will not reverse the judgment where the decision does not prejudice the substantial rights of a party. Ind. Trial Rule 61; Weinberger, 956 N.E.2d at 1104.
Hearsay is a statement that is offered in evidence to prove the truth of the matter asserted. Ind. Evidence Rule 801(c)(2). Hearsay is not admissible unless our Evidence Rules or other law provides otherwise. Evid. R. 802.
Kizer is a state-licensed civil engineer. He received his engineering degree from Valparaiso University in 1978. Tr. p. 37. At the time of the hearing, Kizer had worked in NIPSCO's transmission-line department for thirty-five years. Id. His focus is on design and ordering of materials, including steel structures, transmission lines, and wood and steel poles. Id.
During the hearing, the Duneland Entities did not challenge Kizer's qualifications as an expert engineer. In fact, the Duneland Entities did not object when Kizer
Kizer then testified how Plaintiff's Exhibit 5 was prepared:
Id. at 48. Counsel for Lambert
Id. at 50. Counsel for Lambert then voir dired Kizer about his personal knowledge of the costs of materials and labor:
Id. at 51-52 (emphasis added).
We find that Kizer was entitled to base his estimate on NIPSCO's internal computer software using the current labor index for labor costs and its purchasing ledger for material costs. Indiana Evidence Rule 703 provides:
This rule is based on the assumption that truly qualified experts are capable of evaluating the information of a sort normally relied on by others in their field. 13 Robert Lowell Miller, Jr., Indiana Practice, Indiana Evidence, § 703.108 (3rd ed.2007).
Miller v. State, 575 N.E.2d 272, 274 (Ind. 1991). However, such hearsay is inadmissible where it is merely a restatement of another's conclusion "as a conclusory answer to an ultimate fact in issue," such that the veracity of the statement is not "subject to the test of cross-examination." Barrix v. Jackson, 973 N.E.2d 22, 26 (Ind. Ct.App.2012), trans. denied,
Here, Kizer, who has been designing and ordering materials at NIPSCO for "many years" as part of his engineering job, testified that he relies on data from other NIPSCO departments so that he can complete material and labor estimates, which are then used in building power lines. Kizer therefore reasonably relied on the current labor index, NIPSCO's purchasing ledger, and other materials — even if hearsay and not falling within any exception — when completing Plaintiff's Exhibit 5. Notably, Kizer brought his own engineering expertise to bear in preparing this estimate, as he testified that the computer program does not perform any engineering functions. Rather, Kizer performs that aspect. Accordingly, the trial court did not abuse its discretion in admitting Plaintiff's Exhibit 5.
Affirmed.
NAJAM, J., and BROWN, J. concur.
Appellants' App. p. 13 (emphasis added).