The World’s Most Expensive Refrigerator

Argument over appliances leads to expensive lesson in conflict escalation.

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In the 1980s and 90s, Robin Leach, host of Lifestyles of the Rich and Famous, gave viewers a glimpse into the (allegedly) real lives of the ultra-wealthy. At the time, there were few competitors to this conspicuous consumption on parade. Before social media democratized self-adulation, if Joe Sixpack wanted to explore the opulent world of the American social elite–their gold-encrusted tea sets, exotic sports cars, and panoramic views of Central Park–then Leach’s program was the way to do it. Aside from the occasional magazine spread, Lifestyles was the path to voyeurism of celebrity and wealth.

Aside from Leach’s distinctive vocal style (imagine Piers Morgan with an air horn stuck in his throat), the takeaway from Lifestyles was, “Wow. I can’t believe how much that thing costs!” or “How could someone pay that much money for one of those?” That was the show’s gimmick and it kept people watching.  Like viewers of MTV Cribs or later celebrity-strewn Twitter and Instagram, some people are fascinated with the way other people live and the choices they make. The more these choices and lifestyles contrast from the everyday lives of the viewers, the more they watched.

If Robin Leach were still doing his schtick today, do you think it would feature a segment about a $256,000 refrigerator in Michigan City, Indiana?  Maybe not. Still, we’d ask the same question: How could someone pay that much money for a refrigerator? 

Carney v. Patino is how. It’s a October 31, 2018 Indiana Court of Appeals decision. If nothing else, it’s an object lesson in the cost of choices.

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Photo by rawpixel.com on Pexels.com

Background

The Court’s opinion explains that Mr. Carney purchased a Michigan City house at a sheriff’s sale, following a foreclosure. He went to the house and learned that Mr. Patino was still residing there. By all accounts, their first meeting was civil and Carney gave Patino additional time to move out.  So far so good.

But Carney and Patino disagreed about their second meeting. Patino said that Carney became angry when he saw Patino removing appliances from the property, blocked the door and refused to let him remove a refrigerator and washing machine that he had purchased. Carney maintained that the second meeting occurred on a different day altogether, and that Patino removed fixtures in the house and damaged the interior.

Carney reported to the police that Patino also stole light fixtures, a screen door, and other items that he believed should not have been removed from the house. Patino denied this, but the police believed Carney and charged Patino with theft.

Getting Attached

At this point, Carney and Patino’s behavior (or alleged behavior) raises a question that is not uncommon in real estate law: When does an appliance or other home amenity become part of the real estate?

To the disappointment of many armchair litigators, this is not a legal question with a one-size-fits-all-answer. Facts matter. In lawyerspeak, “it depends.” Here, it depends on the intent of the owner when the appliance was put into the home. This often involves  examining how much the item has been adapted to the home’s use, and whether damage would result from its removal. If the facts suggest the appliance was intended to be part of the home and damage would occur if the item were removed, then the appliance is part of the real estate–an attachment.  Typically, furnaces are attachments and toasters are not. But other appliances, like refrigerators, sometimes pose murkier issues.

Obviously, the police were convinced that Patino had removed attachments. As attachments, they reasoned, these items belonged to the home that Carney purchased at tax sale, and Patino committed theft by removing them.

We the Jury – Verse 1

The theft case against Patino dragged on for nearly five years, but eventually was tried to a jury. The jury found Patino not guilty.

Imagine being accused of a crime you did not commit. Not only by a single person–but by the State. For five long years. Former Secretary of Labor Raymond Donovan once faced federal charges so weak that his lawyers didn’t call a single witness and still won the case. Following the long ordeal and blistering scrutiny from the press, Donovan quipped, “Which office do I go to to get my reputation back?”

Mr. Patino’s answer was to head back to court.  After Patino’s acquittal, he sued Carney for defamation. Defamation occurs when someone (1) maliciously (2) publishes (3) a statement with defamatory imputation which (3) damages the subject of the statement. A statement that accuses someone of a crime automatically defamatory. Defamation is the legal umbrella for the more common terms libel and slander.

Patino argued that Carney’s report of the alleged crime was false and malicious and damaged Patino’s reputation through filing of criminal charges. Part of his damages were the attorney fees he had to pay to defend the criminal case, as well as the damage to his reputation.

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Agreeing to disagree is a lost art.

We the Jury – Verse 2

At trial in this civil case, the jury found in Patino’s favor, and the trial court entered a judgment of $256,000 against Carney.

Carney challenged this determination on appeal, arguing that his report to the police should not be eligible to be considered as defamation.  Essentially, Carney argued that he should be immune from liability for reporting what he believed to be a crime.  This type of “qualified privilege” is recognized in the law, and acknowledges that even if a statement is defamatory in nature, there’s no way it can be made with “malice” if it is a good faith report of a crime. However, the appellate court found that the jury could have legitimately found that Carney’s actions went beyond merely reporting the crime, thereby losing the protection of the qualified privilege. The Court explained:

Patino presented sufficient evidence to show that Carney was not being truthful when he told police that  . . . he witnessed Patino removing various fixtures from the premises[.]

I believe it’s likely jury also called Carney’s motives into question when it heard that he appeared at Patino’s place of business the month after Patino moved out, demanding he return appliances, stating “When we’re done with you, we’re sending you back where you came from.”  Of Mexican ancestry, Patino took the statement to believe that Carney was suggesting Patino should be deported.

Finally, Carney argued that the jury’s award was excessive and should have been reduced by the trial court.  Again, the Court of Appeals disagreed. It noted that the law gives juries’ great deference when deciding the value of “pain, suffering, fright, humiliation, and mental anguish” because juries are in the best position to judge the evidence and credibility of witnesses. In this case, the Court explained, there was ample evidence that Patino suffered greatly from the “highly publicized” charge and arrest, the five years it took to get to trial, and the ongoing impact on his personal and professional life.

Champagne Wishes and Caviar Dreams!

Hindsight is never just 20/20. It’s better than that. It’s mental clairvoyance and historic x-ray vision. It’s emotional time-traveling. It’s the echo of regret.  I regret every time I eat BBQ wings wearing a tie.

I suspect Mr. Carney regrets making a big deal about some household appliances.

A great many legal battles are not worth having. Choose peace. It’s impossible to lose a fight that never happened.