Opinion
No. 107536
04-18-2019
RAE-ANN SUBURBAN, INC., Plaintiff-Appellee/Cross-Appellant, v. ARNOLD WOLFE, ET AL., Defendants-Appellants/Cross-Appellees.
Appearances: Richard A. Myers, Jr. & Associates, L.L.C., Jacob L. Davidson, for appellant/cross-appellee. Rolf Goffman Martin Lang L.L.P., W. Cory Phillips and David S. Brown, for appellee/cross-appellant.
JOURNAL ENTRY AND OPINION JUDGMENT: DISMISSED Civil Appeal from the Cuyahoga County Court of Common Pleas
Case No. CV-17-887761
Appearances:
Richard A. Myers, Jr. & Associates, L.L.C., Jacob L. Davidson, for appellant/cross-appellee. Rolf Goffman Martin Lang L.L.P., W. Cory Phillips and David S. Brown, for appellee/cross-appellant. EILEEN A. GALLAGHER, J.:
{¶ 1} Defendant-appellant/cross-appellee Elaine Mathews and plaintiff-appellee/cross-appellant Rae-Ann Suburban, Inc. ("Rae-Ann") appeal from a decision of the Cuyahoga County Court of Common Pleas granting partial summary judgment in favor of Rae-Ann on its claim for fraudulent conveyance against Mathews and awarding Rae-Ann compensatory damages in the amount of $102,933.37, plus statutory interest from the date of the judgment and costs. Mathews contends that there are genuine issues of material fact both as to liability and damages and that the trial court, therefore, erred in granting partial summary judgment in favor of Rae-Ann on its fraudulent conveyance claim against Mathews. Rae-Ann contends that the trial court erred in awarding it interest at the statutory rate rather than the contract rate and in failing to award Rae-Ann its attorney fees and punitive damages. For the reasons that follow, we dismiss this appeal for lack of jurisdiction.
{¶ 2} In March 2017, Arnold and Ruth Wolfe (collectively, "the Wolfes") became residents of Rae-Ann, a long-term care facility in Westlake, Ohio. Diane Seman, one of the Wolfes' daughters, allegedly signed the admission agreements with Rae-Ann as her parents' "representative." On July 19, 2017, the Wolfes transferred their former residence, a home located on Misty Meadow Drive in North Ridgeville, Ohio, by quitclaim deed to another daughter, Mathews.
{¶ 3} On October 20, 2017, Rae-Ann filed suit against the Wolfes and Seman, seeking to recover the unpaid balance due for the care and services it had provided to the Wolfes under the admission agreements. On November 17, 2017, Rae-Ann filed an amended complaint, adding Mathews as a defendant and asserting additional claims against the Wolfes. Rae-Ann alleged that it had not been paid for the care and services it had provided to the Wolfes pursuant to the admission agreements, that it had reasonably relied on Seman's promises to pay for the care and services provided or to apply for Medicaid if the Wolfes could not afford to pay and that the Wolfes had transferred the only asset from which they could pay Rae-Ann to Mathews for "zero consideration." Rae-Ann asserted claims for breach of an implied-in-fact contract, action on account, unjust enrichment, necessaries under R.C. 3103.03(C) and fraudulent conveyance against the Wolfes, claims for breach of contract and promissory estoppel against Seman and a claim for fraudulent conveyance against Mathews. Rae-Ann requested that judgment be entered "jointly and severally" against the defendants, seeking to recover (1) the lesser of the "amount of the underlying debt" or the value of the transferred real property, plus punitive damages and attorney fees, against the Wolfes and Mathews on the fraudulent conveyance claims and (2) the amount due under the admission agreements, including interest and attorney fees, from Seman and the Wolfes on the remaining claims.
{¶ 4} The defendants filed a joint answer to the amended complaint. The defendants admitted that the Wolfes had transferred their former home to Mathews and that Mathews had a "familiar relationship" with the Wolfes, but denied any wrongdoing. They also asserted various affirmative defenses.
The Wolfes, Seman and Mathews are collectively referred to herein as the "defendants." --------
{¶ 5} On February 27, 2018, Rae-Ann filed a motion for partial summary judgment "as to Defendant Elaine M. Mathews only." Rae-Ann argued that it was undisputed: (1) that as of February 26, 2018, a total of $102,933.37, plus interest and attorney fees, remained due and owing to Rae-Ann under the admission agreements; (2) that the Wolfes had transferred their real property via quitclaim deed to their daughter Mathews, an "insider," on July 19, 2017; (3) that prior to the transfer, the Wolfes owed Rae-Ann over $41,000 in unpaid charges; (4) that after the transfer, the Wolfes incurred an additional $82,573.66 in unpaid charges; (5) that the transferred real property was substantially all of the Wolfes' assets; (6) that the Wolfes received nothing of value in exchange for the transfer and became insolvent after the transfer; and (7) that the transfer occurred both shortly before and shortly after debt was incurred to Rae-Ann. Rae-Ann further contended that, based on these undisputed facts, the transfer of the property to Mathews was a fraudulent transfer under R.C. 1336.04(A)(1), (A)(2)(b) and 1336.05(A) and that Rae-Ann was entitled to judgment against Mathews, as the first transferee of the asset, in the amount of the principal balance due of $102,933.37, plus interest, attorney fees and punitive damages in an amount "to be determined."
{¶ 6} Mathews opposed the motion for partial summary judgment, arguing that there were genuine issues of material fact (1) as to whether the Wolfes were obligated under the admission agreements because neither of the Wolfes signed the agreements and Seman signed the agreements as the Wolfes' "daughter," not as their attorney-in-fact, (2) as to the amount of Rae-Ann's damages, asserting that Rae-Ann had been paid $21,000 after the property at issue was transferred to Mathews and (3) as to whether the Wolfes transferred their real estate with actual intent to hinder, delay or defraud a creditor because the Wolfes transferred their property to their disabled daughter in order to become eligible for Medicaid and the transfer of property to a disabled child is not an improper transfer under Medicaid rules.
{¶ 7} On July 12, 2018, the trial court issued a journal entry granting Rae-Ann's motion for partial summary judgment as to Mathews only. The trial court concluded that there were no genuine issues of material fact and that Rae-Ann was entitled to judgment as a matter of law "on Count 15 of its complaint [the fraudulent conveyance count] against Defendant Elaine M. Mathews." The trial court awarded judgment in favor of Rae-Ann and against Mathews "in the amount of $102,933.37, plus interest at the applicable statutory rate from the date of the judgment, plus costs of this action." The trial court did not address Rae-Ann's prayer for punitive damages or attorney fees. However, the trial court stated that "[p]ursuant to Civ.R. 54(B), this [sic] is no just reason for delay." Mathews appealed, raising the following single assignment of error for review:
The Cuyahoga County Court of Common Pleas erred in granting plaintiff's motion for partial summary judgement [sic] pursuant to Ohio Civil Rule 56.
{¶ 8} Rae-Ann cross-appealed, raising the following three cross-assignments of error:
Cross-assignment of Error No. 1: The trial court erred when it entered judgment by finding "interest at the applicable statutory rate from the date of judgment . . . " where the written contracts between the parties provided for a rate of interest of 1.5% per month, or 18% per annum.
Cross-assignment of Error No. 2: The trial court's judgment erred by not awarding Rae-Ann its attorney fees where the written contracts between the parties allow for recovery of Rae-Ann's attorney fees incurred.
Cross-assignment of Error No. 3: The trial court's judgment erred by not awarding Rae-Ann punitive damages.
{¶ 9} Before we can review the merits, we must first consider whether we have jurisdiction to hear this appeal. Our appellate jurisdiction is limited to reviewing orders that are both final and appealable. See Article IV, Section 3(B)(2), Ohio Constitution; R.C. 2505.02, 2505.03. '"If an order is not final and appealable, then an appellate court has no jurisdiction to review the matter and the appeal must be dismissed."' Scheel v. Rock Ohio Caesars Cleveland, L.L.C., 8th Dist. Cuyahoga No. 105037, 2017-Ohio-7174, ¶ 7, quoting Assn. of Cleveland Firefighters, # 93 v. Campbell, 8th Dist. Cuyahoga No. 84148, 2005-Ohio-1841, ¶ 6. This court has a duty to examine, sua sponte, potential deficiencies in jurisdiction. See, e.g., Scheel at ¶ 7; Arch Bay Holdings, L.L.C. v. Goler, 8th Dist. Cuyahoga No. 102455, 2015-Ohio-3036, ¶ 9; see also Scanlon v. Scanlon, 8th Dist. Cuyahoga No. 97724, 2012-Ohio-2514, ¶ 5 ("In the absence of a final, appealable order, the appellate court does not possess jurisdiction to review the matter and must dismiss the case sua sponte.").
{¶ 10} To that end, we ordered the parties to submit supplemental briefs addressing the issue of whether the order appealed from constitutes a final, appealable order as follows:
Even though the trial court's journal entry includes Civ.R. 54(B) language, the claim decided against appellant is the same or similar
claim that remains pending against defendants Ruth Wolfe and Arnold Wolfe. Therefore, the parties should address whether the order satisfies the requirements of R.C. 2505.02 such that the inclusion of Civ.R. 54(B) language makes the order capable of invoking appellate jurisdiction.
{¶ 11} Mathews and Rae-Ann each filed supplemental appellate briefs addressing the issue. Mathews contends that the trial court's July 12, 2018 journal entry is not a final, appealable order and that the trial court abused its discretion in certifying that there was "no just reason for delay" because (1) the fraudulent conveyance claims against the Wolfes "cannot be effectively separated from the claim that was determined" on Rae-Ann's motion for partial summary judgment and (2) "[t]he nature of the claim before the court is such that an appellate court may have to decide the same issue more than once during subsequent appeals." Rae-Ann asserts that the trial court's journal entry is a final, appealable order, satisfying both Civ.R. 54(B) and R.C. 2505.02(B)(1), because it (1) "include[d] language that there was no just reason for delay," (2) resulted in a judgment against Mathews and the imposition of a judgment lien against Mathews' properties, (3) "resolves" all of Rae-Ann's claims against Elaine Mathews, (4) "fully adjudicates the fraudulent transfer claim" "with no additional remedies available to Rae-Ann" and (5) "prevents a judgment in favor of Elaine Mathews."
{¶ 12} Where, as here, a matter involves multiple claims and parties, "[a]n order which adjudicates one or more but fewer than all the claims or the rights and liabilities of fewer than all the parties must meet the requirements of R.C. 2505.02 and Civ.R. 54(B) in order to be final and appealable." Noble v. Colwell, 44 Ohio St.3d 92, 540 N.E.2d 1381 (1989), syllabus.
{¶ 13} Pursuant to Civ.R. 54(B), "[w]hen more than one claim for relief is presented in an action * * * or when multiple parties are involved, the court may enter final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay." A trial court's use of Civ.R. 54(B) certification is "within its sound discretion." Noble at 97 and fn. 7.
{¶ 14} Simply because a trial court includes Civ.R. 54(B) language in its journal entry does not mean that it is a final, appealable order. "No just reason for delay" "is not a mystical incantation which transforms a nonfinal order into a final appealable order." Wisintainer v. Elcen Power Strut Co., 67 Ohio St.3d 352, 354, 617 N.E.2d 1136 (1993), citing Chef Italiano Corp. v. Kent State Univ., 44 Ohio St.3d 86, 541 N.E.2d 64 (1989). "Such language can, however, through Civ.R. 54(B), transform a final order into a final appealable order." Wisintainer at 354.
{¶ 15} The "general purpose" of Civ.R. 54(B) is "to accommodate the strong policy against piecemeal litigation with the possible injustice of delayed appeals in special situations." Noble at 96, citing Alexander v. Buckeye Pipe Line Co., 49 Ohio St.2d 158, 160, 359 N.E. 2d 702 (1977). Thus, a trial court should make a Civ.R. 54(B) determination only when an immediate appeal would serve the interests of judicial economy. See, e.g., Third Fed. S. & L. v. Krych, 8th Dist. Cuyahoga No. 99762, 2013-Ohio-4483, ¶ 7, citing Sullivan v. Anderson, 122 Ohio St.3d 83, 2009- Ohio-1971, 909 N.E.2d 88, ¶ 11 ("In the ordinary case, Civ.R. 54(B) certification demonstrates that the trial court has determined that an order, albeit interlocutory, should be immediately appealable, in order to further the efficient administration of justice and to avoid piecemeal litigation or injustice attributable to delayed appeals."), and Wisintainer at 355. A trial court's determination under Civ.R. 54(B) that there is "no just reason for delay" is comparable to a factual finding. Wisintainer at 355. "[W]here the record indicates that the interests of sound judicial administration could be served by a finding of 'no just reason for delay,' the trial court's certification determination must stand." Id. Where, however, the interests of judicial economy are not served by immediate appeal, a trial court's Civ.R. 54(B) finding is "subject to reversal." Third Fed. S. & L. at ¶ 7, citing Hill v. Hughes, 4th Dist. Ross No. 06CA2917, 2007-Ohio-3885, ¶ 8.
{¶ 16} A partial final order is not appealable pursuant to Civ.R. 54(B) if pending unresolved claims "touch upon the very same facts, legal issues and circumstances" as the resolved claims. Altenheim v. Januszewski, 8th Dist. Cuyahoga No. 105860, 2018-Ohio-1395, ¶ 3-7, 10-13 (dismissing care facility's appeal of order granting summary judgment to defendant on facility's claims relating to the admission and care of her late father on the ground that it was not a final, appealable order because defendant's counterclaims against facility had not yet been adjudicated; even if order had included a certification under Civ.R. 54(B), it "would not be sufficient to render that order final and appealable" because "the unresolved counterclaims touch on the same facts, legal issues, and circumstances as the claims presented on appeal"); see also Salata v. Vallas, 159 Ohio App.3d 108, 2004-Ohio-6037, 823 N.E.2d 50, ¶ 18-24 (7th Dist.) (where claims that remained pending before the trial court were based on the same facts and circumstances as adjudicated claim, trial court order granting partial summary judgment was not a final, appealable order despite the inclusion of Civ.R. 54(B) language); Third Fed. S. & L. at ¶ 8-10 (trial court's judgment was not a final, appealable order where judicial economy would not be served by separating claims for review because claims that were pending were "interrelated" to the claims on which the trial court granted summary judgment); Portco, Inc. v. Eye Specialists, Inc., 173 Ohio App.3d 108, 2007-Ohio-4403, 877 N.E.2d 709, ¶ 10-11 (4th Dist.) ("trial court should not have included" Civ.R. 54(B) language where it did not serve "sound judicial administration" because the adjudicated claim and unresolved counterclaims all touch upon on the same facts, legal issues and circumstances).
{¶ 17} As this court stated in Third Fed. S. & L.:
"An order that disposes of fewer than all of the claims in an action, and contains a Civ.R. 54(B) determination that there is no just reason for delay, is appealable if the claim or claims disposed of are entirely disposed of and either of the following applies. First, are the disposed of claims factually separate and independent from the remaining claims? An example would be claims that are based on different transactions or occurrences such as one claim for slander and another for negligence because of an automobile accident. Second, if the claims are not factually separate and independent, do the legal theories presented in the disposed of claims require proof of substantially different facts and/or provide for different relief from the remaining claims?"Third Fed. S. & L., 2013-Ohio-4483, at ¶ 8, quoting Walker v. Firelands Community Hosp., 6th Dist. Erie No. E-06-023, 2006-Ohio-2930, ¶ 23.
{¶ 18} In this case, the claim addressed in the trial court's order granting partial summary judgment to Rae-Ann against Mathews is not factually separate and independent from the claims that remain. The "resolved" fraudulent conveyance claim against Mathews and the remaining claims against the Wolfes and Seman — particularly the virtually identical fraudulent conveyance claims against the Wolfes — are all based on the same set of facts and circumstances and touch upon the same factual and legal issues. Because the "resolved" claim and the claims that remain are intertwined, a piecemeal appeal would not serve the interest of judicial economy. See, e.g., Internatl. Managed Care Strategies, Inc. v. Franciscan Health Partnership, Inc., 1st Dist. Hamilton No. C-010634, 2002-Ohio-4801, ¶ 9 ("Where claims arise from the same alleged conduct, they are inextricably intertwined and not appealable despite Civ.R. 54(B) certification."), citing Ollick v. Rice, 16 Ohio App.3d 448, 452, 476 N.E.2d 1062 (8th Dist.1984). Accordingly, the trial court abused its discretion in certifying the case for immediate appeal under Civ.R. 54(B).
{¶ 19} Furthermore, Civ.R. 54(B) "does not alter the requirement" that an order must be "final" before the "no just reason for delay" language renders it appealable. Altenheim, 2018-Ohio-1395, at ¶ 10, citing Gen. Acc. Ins. Co. v. Ins. Co. of N. Am., 44 Ohio st.3d 17, 21, 540 N.E.2d 266 (1989). '"A final order * * * is one disposing of the whole case or some separate and distinct branch thereof.'" Noble, 44 Ohio St.3d at 94, 540 N.E.2d 1381, quoting Lantsberry v. Tilley Lamp Co., 27 Ohio St.2d 303, 306, 272 N.E.2d 127 (1971). Regardless of the Civ.R. 54(B) language, if an order is not final under R.C. 2505.02, then the appeal must be dismissed because the appellate court lacks jurisdiction.
{¶ 20} In this case, it does not appear that the trial court resolved Ran-Ann's prayer for punitive damages or attorney fees against Mathews in Count 15. "Where a prayer for relief requests a particular type of damages and the court fails to specifically adjudicate that aspect of the damages requested, no final appealable order exists." Adkins v. Bratcher, 4th Dist. Washington No. 06CA53, 2007-Ohio-3587, ¶ 1, 11-12 (trial court's judgment entries on a breach-of-contract claim were not final appealable orders under R.C. 2505.02 because the trial court "never disposed of [plaintiff's] prayers for punitive damages and prejudgment interest as part of his damages award" and, therefore, "did not resolve the entire claim"); Williams v. Waller, 8th Dist. Cuyahoga No. 69069, 1996 Ohio App. LEXIS 5830, 14-15 (Dec. 26, 1996) (where issue of punitive damages remained unresolved, journal entry was not a final, appealable order; "[a]n order which does not determine all of the damage allegations for a single cause of action does not conclude that claim"); State ex rel. Bd. of State Teachers Ret. Sys. v. Davis, 113 Ohio St.3d 410, 2007-Ohio-2205, 865 N.E.2d 1289, ¶ 44-46 (journal entry that left punitive damages claim unresolved did not constitute a final appealable order because a request for punitive damages ""is not a separate claim in itself but rather an issue in the overall claim for damages'"), quoting Horner v. Toledo Hosp., 94 Ohio App.3d 282, 288, 640 N.E.2d 857 (6th Dist. 1993). "When a trial court does not resolve an entire claim, regardless of whether the order meets the requirements of Civ.R. 54(B), the order is not final and appealable." Adkins at ¶ 9, citing Jackson v. Scioto Downs, Inc., 80 Ohio App.3d 756, 758, 610 N.E.2d 613 (10th Dist.1992).
{¶ 21} There being no final appealable order in this case, the appeal and cross-appeal are dismissed for lack of jurisdiction, and the case is remanded to the trial court for further proceedings.
{¶ 22} Appeal and cross-appeal dismissed.
It is ordered that appellant/cross-appellee and appellee/cross-appellant share the costs herein taxed.
A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of the Rules of Appellate Procedure. /s/_________
EILEEN A. GALLAGHER, JUDGE EILEEN T. GALLAGHER, P.J., and
LARRY A. JONES, SR., J., CONCUR