[Cite as Lucas Contracting, Inc. v. Altisource Portfolio Solutions, Inc., 2016-Ohio-474.]
COURT OF APPEALS
STARK COUNTY, OHIO
FIFTH APPELLATE DISTRICT
LUCAS CONTRACTING, INC. : JUDGES:
: Hon. William B. Hoffman, P.J.
Plaintiff - Appellee : Hon. Patricia A. Delaney, J.
: Hon. Craig R. Baldwin, J.
-vs- :
:
ALTISOURCE PORTFOLIO : Case No. 2015CA00102
SOLUTIONS, INC. :
:
Defendant - Appellant : OPINION
CHARACTER OF PROCEEDING: Appeal from the Stark County Court
of Common Pleas, Case No. 2014-
CV-01361
JUDGMENT: Affirmed
DATE OF JUDGMENT: February 9, 2016
APPEARANCES:
For Plaintiff-Appellee For Defendant-Appellant
SIDNEY N. FREEMAN MICHAEL J. ZBIEGIEN, JR.
12370 Cleveland Avenue, N.W. JENNIFER B. ORR
P.O. Box 867 Taft Stettinius & Hollister, LLP
Uniontown, Ohio 44685 200 Public Square, Suite 3500
Cleveland, Ohio 44114-2302
ROBERT MCNAMARA
McNamara, Demczyk Co., LPA
12370 Cleveland Ave., N.W.
P.O. Box 867
Uniontown, Ohio 44685
Stark County, Case No. 2015CA00102 2
Baldwin, J.
{¶1} Defendant-appellant Altisource Portfolio Solutions, Inc. appeals from the
February 23, 2015 and April 23, 2015 Judgment Entries of the Stark County Court of
Common Pleas.
STATEMENT OF THE FACTS AND CASE
{¶2} On June 9, 2014, appellee Lucas Contracting, Inc. brought an action against
Berghorst Enterprises, LLC and Heritage Home Solutions, LLC for statement on an
account, breach of contract, promissory estoppel, implied contract and alter ego liability.
The complaint related to property preservation services that appellee alleged the two had
purchased from appellee. Appellee, in its complaint, alleged that neither Berghorst
Enterprises nor Heritage Home had ever had a separate corporate existence from the
other and that it was owed a total of $65,187.75.
{¶3} On July 29, 2014, appellee filed a motion seeking to add appellant
Altisource Portfolio Solutions, Inc. as a new party defendant. Appellee, in its motion,
alleged that while it had contact with Berghorst Enterprises, LLC and Heritage Homes
Solutions, LLC, the services that appellee had performed on foreclosed properties were
actually ordered by appellant. The trial court granted such motion as memorialized in a
Journal Entry filed on July 29, 2014 and an Amended and Supplemental Complaint
adding appellant as a new party defendant was filed on July 31, 2014. Appellant filed an
answer on October 6, 2014. A pretrial was scheduled for November 10, 2014.
{¶4} The trial court, as memorialized in an Order filed on November 13, 2014,
dismissed the case after it was represented to the court at the November 10, 2014 pretrial
Stark County, Case No. 2015CA00102 3
that the matter was settled by agreement of the parties. The trial court ordered the parties
to file a final agreed upon judgment entry approved by all counsel within thirty (30) days.
{¶5} Thereafter, on December 10, 2014, appellee filed a Motion to Enforce
Settlement. Appellant filed a response to the same on December 26, 2014. The trial court
scheduled an oral hearing on such motion for February 6, 2015.
{¶6} The trial court, pursuant to a Judgment Entry filed on February 23, 2015,
found that a full settlement and compromise had been made in this case and instructed
appellee to prepare “a Final Judgment Entry according to the terms that were exchanged
on November 10, 2014 as outlined in this entry and submit it for signatures and to the
Court for approval within thirty (30) days of the date of this Entry.” A Settlement
Agreement approved by the trial court and counsel for appellee, but not for appellant, was
then filed on April 23, 2015.
{¶7} Appellant now raises the following assignments of error on appeal:
{¶8} I. THE TRIAL COURT ERRED AS A MATTER OF LAW IN ITS FEBRUARY
23, 2015 JUDGMENT ENTRY GRANTING LUCAS CONTRACTING’S MOTION TO
ENFORCE SETTLEMENT BECAUSE THERE WAS CLEAR EVIDENCE
DEMONSTRATING THAT THE PARTIES DID NOT INTEND TO BE BOUND UNTIL A
FORMALIZED WRITTEN DOCUMENT WAS SIGNED BY BOTH PARTIES AND
BECAUSE IT ENFORCED A SETTLEMENT AGREEMENT AGAINST AN ENTITY,
ALTISOURCE PORTFOLIO SOLUTIONS, INC., WHO WAS NOT AN INTENDED
PARTY TO ANY ALLEGED SETTLEMENT AGREEMENT.
{¶9} II. THE TRIAL COURT ERRED AS A MATTER OF LAW IN ADOPTING
LUCAS CONTRACTING’S PROPOSED SETTLEMENT ENTRY IN ITS APRIL 23, 2015
Stark County, Case No. 2015CA00102 4
SETTLEMENT ENTRY, BECAUSE IN DOING SO, IT ENFORCED SETTLEMENT
TERMS THAT ARE CONTRADICTORY TO THE VERY TERMS THAT THE COURT
FOUND THE PARTIES HAD AGREED TO IN ITS JUDGMENT ENTRY GRANTING
LUCAS CONTRACTING’S MOTION TO ENFORCE SETTLEMENT.
I
{¶10} Appellant, in its first assignment of error, argues that the trial court erred in
granting appellee’s Motion to Enforce Settlement. Appellant specifically argues that there
was clear evidence showing that the parties did not intend to be bound until a formal
written document was signed by both parties and that the trial court erred in enforcing a
settlement agreement against an entity that was not an intended party to any alleged
settlement agreement.
{¶11} A settlement agreement is a particularized form of a contract. Noroski v.
Fallet, 2 Ohio St.3d 77, 79, 442 N.E.2d 1302 (1982). It is a “contract designed to terminate
a claim by preventing or ending litigation, and * * * such agreements are valid and
enforceable by either party.” Continental W. Condominium Unit Owners Assn. v. Howard
E. Ferguson, Inc., 74 Ohio St.3d 501, 502, 1996-Ohio-158, 660 N.E.2d 431. If a contract
encompasses the essential terms of the agreement, it is binding and enforceable. Mr.
Mark Corp. v. Rush, Inc., 11 Ohio App.3d 167, 169, 464 N.E.2d 586 (8th Dist.1983). The
Ohio Supreme Court has stated that the issue of “whether the parties intended to be
bound * * * is a question of fact properly resolved by the trier of fact.” Oglebay Norton Co.
v. Armco, Inc., 52 Ohio St.3d 232, 235, 556 N.E.2d 515 (1990). The parties must have a
“distinct and common intention that is communicated by each party to the other.”
Stark County, Case No. 2015CA00102 5
Champion Gym & Fitness, Inc. v. Crotty, 178 Ohio App.3d 739, 744, 2008-Ohio-5642,
900 N.E.2d 231, ¶ 12.
{¶12} As noted by the court in Klever v. Stow, 13 Ohio App.3d 1, 468 N.E.2d 81
(9th Dist. 1983), a trial court has the authority to conduct a hearing to determine whether
or not a verbal settlement agreement has been reached. The court stated that “when the
parties agree to a settlement offer, this agreement cannot be repudiated by either party,
and the court has the authority to sign a journal entry reflecting the agreement and to
enforce the settlement.” Id at 4. The Ohio Supreme Court has held that “where the
meaning of terms of a settlement agreement is disputed, or where there is a dispute that
contests the existence of a settlement agreement, a trial court must conduct an
evidentiary hearing prior to entering judgment.” Rulli v. Fan Co., 79 Ohio St.3d 374, 377,
1997–Ohio–380, 683 N.E.2d 337.
{¶13} As is stated above, a hearing before the trial court was held on February 6,
2015. While the trial court offered to hear testimony from witnesses, the parties agreed to
rest on their filings and submitted exhibits. The parties thus waived their right to an
evidentiary hearing by failing to request such a hearing or to object to the lack of an
evidentiary hearing. Monea v. Campisi, 5th Dist. Stark No.2004CA00381, 2005–Ohio–
5215.
{¶14} At the February 6, 2015 hearing, an e-mailed faxed letter dated November
10, 2014 from appellee’s counsel to appellant’s counsel was admitted as an exhibit. The
letter states as follows:
Stark County, Case No. 2015CA00102 6
Confirming our telephone conversations this date, we
tentatively have agreed to settle the case, in principle, as
follows:
1. Altisource will pay Lucas Contracting immediately
the full sum of $30,000;
2. Lucas Contracting will assign to Altisource all
claims, rights and causes of action it may possess
against Berghorst Enterprises, LLC, and Heritage
Home Solutions, LLC; and
3. Lucas Contracting will provide reasonable
assistance to Altisource in pursuing claims
Altisource may wish to bring against Berghorst
Enterprises, LLC. And Heritage Home Solutions,
LLC (but this does not include paying the fees of
attorneys or expenses necessary to any litigation
or collection, and does not include any agreement
to warrant, defend or hold harmless Altisource
with regard to any such actions).
Obviously, all of this is subject to approval of settlement
documents. If you could forward same for my review and
approval as soon as possible it would be appreciated, as time
is of the essence in getting this concluded, and is a material
consideration in my client’s decision to settle.
Stark County, Case No. 2015CA00102 7
{¶15} Also admitted as an exhibit was a November 10, 2014 response from
appellant’s counsel to appellee’s counsel stating as follows:
Thank you for the letter. As Jeff Pomeranz [of
Altisource] and I mentioned on the phone, Jeff will send you
the standard settlement and release agreement in the next
day or two. The executed settlement and release agreement
will establish the parties’ respective obligations. In the
meantime, I want to clarify that before Altisource will pay
Lucas Contracting, Lucas must be set up as a vendor in
Altisource’s system (requires a W-9 and other administrative
information such as how to remit payment), in addition to
executing the settlement and release agreement and a
dismissal of the claims. Assuming everything proceeds
smoothly, we anticipate that this process will be completed
within 30 days.
{¶16} On November 12, 2014, appellee received from appellant its proposed
settlement agreement, which was introduced at the February 6, 2015 hearing as an
exhibit. The proposed settlement agreement contained terms that were not mentioned in
either of the November 10, 2014 e-mails. The agreement, for example, contained
language requiring the personal signature of Jennifer Lucas, who was not a party to the
proceedings.
{¶17} At the hearing, appellant’s counsel indicated to the trial court that the
parties’ settlement provided that Altisource Solutions S.a.r.l., which is not a party to this
Stark County, Case No. 2015CA00102 8
case, would pay the $30,000.00 “in exchange for execution of Altisource’s
standard…settlement and release agreement, which included execution by a principal of
the company,…” Transcript at 15. Counsel for appellant agreed that there was no specific
discussion about Jennifer Lucas signing personally, but contended that “that’s part of the
standard settlement agreement in a release.” Transcript at 17. Counsel for appellee
indicated that personal liability was intended when the parties exchanged e-mails on
November 10, 2014. However, at the hearing, appellee’s counsel agreed that he never
told appellant’s counsel that personal liability was part of appellant’s standard settlement
agreement. When asked by the trial court why he did not fax the standard settlement
agreement to appellee’s counsel, appellant’s counsel stated that he did not have the
agreement printed up and that he personally had never seen the standard settlement
agreement. As noted by the trial court, “[t]herefore, it appears… that [appellant’s counsel]
was not originally aware that Altisource would try to hold Jennifer Lucas to the terms of
the settlement in her individual capacity.”
{¶18} We find that the trial court did not err by granting the Motion to Enforce
Settlement. Appellee clearly set out the terms of the settlement in its November 10, 2014
e-mail and in its response the same day, appellant never contradicted or challenged the
same. We concur with the trial court that the parties, through their respective e-mails,
agreed to the terms of the settlement. In neither of the November 10, 2014 e-mails, was
any mention made that, as part of the agreement, Jennifer Lucas was to be held
personally responsible. While appellant also argues that the settlement was between
appellant and Altisource Solutions S.a.r.l. and not appellant, which was not a party to the
settlement agreement, there is nothing in the November 10, 2014 e-mails so indicating.
Stark County, Case No. 2015CA00102 9
{¶19} Based on the foregoing, appellant’s first assignment of error is, therefore,
overruled.
II
{¶20} Appellant, in its second assignment of error, argues that the trial court erred
in adopting appellee’s proposed settlement agreement in its April 23, 2015 Settlement
Entry. Appellant maintains that the Entry contains provisions that the parties never agreed
on and that were contrary to the trial court’s own findings in its February 23, 2015
Judgment Entry.
{¶21} Appellant first argues that the trial court’s statement in its April 23, 2015
Settlement Entry that “judgment” be granted in favor of appellee and against appellant
improperly constitutes an admission of liability when the parties did not intend such an
admission. We disagree. The trial court, in is April 23, 2015 Settlement Entry, stated
that it found appellee’s Motion to Enforce Settlement to be well-taken and granted
judgment in the amount of $30,000.00. There is no indication of any admission of liability.
{¶22} Appellant also argues that the April 23, 2015 Settlement Entry does not
contain an assignment by appellee of its claims against Berghorst and Heritage. Appellant
notes that the trial court found that this was part of the agreement between the parties.
However, the trial court’s April 23, 2015 Settlement Entry states, in relevant part, as
follows: “It is further Ordered that, conditioned upon, and only at such time as payment in
full of the aforesaid THIRTY THOUSAND AND NO/100 DOLLARS ($30,000.00) is made
by Altisource to Plaintiff, all claims, rights and causes of action that Plaintiff had or may
possess against Berghorst Enterprises, LLC and Heritage Home Solutions, LLC, will
belong to Altisource.” We find that this language constitutes an assignment.
Stark County, Case No. 2015CA00102 10
{¶23} Appellant, in its second assignment of error, further argues that the trial
court’s Settlement Entry did not contain a release of appellee’s claims against appellant,
which appellant argues is a standard term found in a settlement agreement. As noted by
appellant, appellee’s counsel, in a November 21, 2014 e-mail to Jeffrey Pomeranz of
Altisource, stated that the “release should be mutual, with both parties releasing the
other;…” However, in a December 2, 2014 response, Pomeranz stated that the release
provision needed to remain “unilateral.” There is nothing in the parties November 10,
2014 exchanged e-mails requiring appellee to release its claims against appellant as part
of the settlement.
{¶24} Appellant’s second assignment of error is, therefore, overruled.
{¶25} Accordingly, the judgment of the Stark County Court of Common Pleas is
affirmed.
By: Baldwin, J.
Hoffman, P.J. and
Delaney, J. concur.