I have to concur with the rest of the replies.

And I know I may come off bad here, but if your Mom signed a contract before regarding your other dog stating he would be kept indoors, and then did not keep with that, that is just the same as breaking a legal promise. It seems to me that the shelter is very concerned for the dogs' well being. They do not know you personally at all, and they see so many dogs that sit abandoned in a back yard or shed with maybe a bit of food and water and that is how it lives its life. They don't know your family personally, and how are they to take your word that your dog doesn't live that way, when your family has broken their agreement in the first place to keep him inside?

They may have seemed nasty to you, because they were threatening to repossess your other dog, but they are only doing their job. Many many purely outdoor dogs are victims of neglect. Not all, of course, but too many are, and the shelter has to assume the worst, especially if the contract is broken.

*edit* Another thought, when they talk about crating, they do not mean shutting him up in a crate day after day, several hours a day... that WOULD be abuse. I think a really good idea for you would be to research a bit on crating and other behavioral issues. A crate used properly should be a dog's den, and an indication to the dog that it is time to sleep awhile in a safe, secure place. Most after being properly crate trained, prefer to sleep in their crate. When my Tasha was a puppy, she would sleep in there with the door open, of her own choice. It is not to be used like a 'cage' at all.