[Cite as Am. Ins. & Monetary, L.L.C. v. Holiday Park Condominium Owners Assn., Inc., 2016-Ohio-2977.]
IN THE COURT OF APPEALS OF OHIO
SIXTH APPELLATE DISTRICT
WOOD COUNTY
American Insurance & Monetary, LLC Court of Appeals No. WD-15-045
Appellant Trial Court No. 2013CV0673
v.
Holiday Park Condominium Owners
Association, Inc., et al. DECISION AND JUDGMENT
Appellees Decided: May 13, 2016
*****
Kevin R. Eff, for appellant.
Thomas E. Puffenberger II and Howard B. Hershman, for appellees.
*****
PIETRYKOWSKI, J.
{¶ 1} This case is before the court on appeal of the Wood County Court of
Common Pleas’ June 9, 2015 judgment granting appellees’ motion to dismiss and the
January 20, 2015 judgment denying appellant’s motion for partial summary judgment.
For the reasons set forth herein we reverse, in part.
{¶ 2} Appellant, American Insurance & Monetary, LLC, is owner of two of six
commercial units (A and F) in the Holiday Park Condominiums (“Holiday Park”) located
in Perrysburg, Wood County, Ohio. Appellees include unit owners RSMM Healthcare,
LLC (“RSMM”) (Unit B), UMG Investments, LLC (Units C and D), and Physical Rehab
Properties, LLC (Unit E). The Holiday Park Condominium Owners Association, Inc.
(Association) was also named in the action. Appellant commenced this declaratory
judgment action based upon the Third Amendment, recorded on November 29, 2012, to
the Declaration of Condominium Property and Ownership (“Declaration”), recorded on
November 29, 2005, which appellant claims grants exclusive use of certain common
areas to owners of Units C and D to the exclusion of the other unit owners. Appellant
requested that the court declare that the Third Amendment is void in that it violated
Article I(B)(4) of the Declaration which prohibited partitioning of the common areas; it
violated V(C) of the Declaration which prohibited exemption from liability for
contribution toward the common expenses; it was not unanimously adopted as required in
the Declaration; and the Third Amendment violates R.C. 5311.04 and is also inequitable.
{¶ 3} The action also requested that the defendants be enjoined from placing
vending machines in the common areas or refusing to make “safety-related and structure-
related” repairs in the common areas. Appellant further contended that the refusal to
fund repairs violated R.C. 5311.19(A). Finally, appellant alleged bad faith in failing to
abide by the Declaration.
2.
{¶ 4} On July 18, 2014, appellant filed a motion for partial summary judgment on
the issue of whether the Third Amendment “facially and materially” lacked the
unanimous approval as required under the Declaration and R.C. 5311.04(E). On
September 8, 2014, appellees filed their opposition to the motion. The court denied the
motion finding that because the term unanimous approval as used in R.C. 5311.04 is not
defined, issues of fact remained as to whether the condominium owners unanimously
approved the Third Amendment.
{¶ 5} On March 6, 2015, the court ordered that the joint pretrial statement be filed
by May 4, 2015. At a May 11, 2015 settlement pretrial conference, the court was
informed that a stipulation of facts had been reached and that issues of law would be
submitted to the court. The court then ordered that the joint pretrial statement and
stipulated facts be submitted by May 26, 2015. Thereafter, on May 26, 2015, the court
granted a joint motion for an extension of time to file the joint pretrial statement. The
court ordered that the statement be submitted by May 28, 2015, and that no further
extensions would be considered.
{¶ 6} On June 9, 2015, at approximately 11:00 a.m., appellees filed a motion to
dismiss appellant’s complaint, with prejudice. Appellees argued that appellant’s failure
to file the joint pretrial statement, despite several extensions and the court’s final order
that it be filed by May 28, 2015, warranted dismissal. Appellees stated that following the
due date, counsel had attempted to contact appellant’s counsel multiple times though
email and telephone but “with no adequate response.” The motion further stated that
3.
plaintiff’s counsel finally contacted the court on June 5, 2015, and indicated that the
pretrial statement would be filed by June 8, 2015. As of the motion’s filing, it had not
been filed.
{¶ 7} On the same date, at about 2:30 p.m., the trial court granted the motion
without explanation. The following morning, in an attempt to supersede the dismissal’s
journalization, appellant filed a notice of voluntary dismissal under Civ.R. 41(A)(1)(a).
The order, however, had been journalized on the date it was filed. Appellant then
commenced the instant appeal.
{¶ 8} Appellant raises four assignments of error for our review:
A. The trial court erred in dismissing appellant’s case with prejudice
a mere three-and-a-half (3.5) hours after the appellees filed their motion
seeking such dismissal and before appellant had either notice of such
motion or a chance to defend against the possibility of such dismissal.
B. The trial court erred in disregarding its own Local Rule 4.04 in
considering and granting, ex parte, the appellees’ motion to dismiss
appellant’s claims with prejudice.
C. The trial court erred, as a matter of law, in failing to read R.C.
5311.04(E) in pari materia with R.C. 5311.05(A).
D. The trial court erred in denying appellant’s motion for summary
judgment as to the validity of the Third Amendment to the Declaration of
Condominium Ownership of Holiday Park Condominiums.
4.
{¶ 9} Appellant’s first and second assignments of error are related and will be
jointly addressed. Appellant argues that the trial court erred by granting appellees’
motion to dismiss without affording appellant notice or an opportunity to defend. We
note that the decision to dismiss a claim pursuant to Civ.R. 41(B)(1) is normally left to
the discretion of the trial court. Jones v. Hartranft, 78 Ohio St.3d 368, 371, 678 N.E.2d
530 (1997). Thus, a reviewing court will not reverse the decision absent an abuse of
discretion. An abuse of discretion implies an unreasonable or arbitrary attitude on the
part of the trial court. Blakemore v. Blakemore, 5 Ohio St.3d 217, 219, 450 N.E.2d 1140
(1983). In determining whether a court abused its discretion in dismissing a claim, a
reviewing court must be mindful the tenet that disposition of cases on their merits is
favored in the law. Jones at 371.
{¶ 10} Appellant argues that the fact that it had no notice of the court’s intent to
dismiss combined with the harshness of the sanction, demonstrates the trial court’s error
in granting appellees’ motion. Conversely, appellees contend that the court was within
its discretion to dismiss the case under Loc.R. 4.01(D)(4) and Loc.R. 4.04(D)(16); and
that, based on these rules and the court’s indication that there would be no further
extensions granted, appellant was on notice of the potential that the case could be
dismissed.
{¶ 11} Relevant to this case, Civ.R. 41(B)(1) provides: “(1) Failure to prosecute.
Where the plaintiff fails to prosecute, or comply with these rules or any court order, the
5.
court upon motion of a defendant or on its own motion may, after notice to the plaintiff’s
counsel, dismiss an action or claim.”
{¶ 12} Loc.R. 4.01(D) of the Court of Common Pleas of Wood County, General
Division, the case management section, provides the procedure for joint pretrial
statements in civil cases. The section reads, in relevant part:
3. The deadline for filing of the joint pretrial statement is firm and
may be extended only by leave of Court for good cause shown.
4. Failure to submit the joint pretrial statement in a timely manner
may result in the imposition of appropriate sanctions, including exclusion
of testimony or exhibits, denial of claims, directed verdicts, dismissal of the
case or contempt of court.
{¶ 13} Loc.R. 4.04(D) provides that the court may consider an ex parte motion in
certain limited circumstances; a motion to dismiss is not enumerated. However,
4.04(D)(16) provides for “Any other motion, for good cause shown.” Section E states
that “[f]or all motions not specified in (D) above, opposing counsel shall serve any
desired response within 14 days after service of the initiating filing unless otherwise
ordered.”
{¶ 14} The notice required prior to a dismissal with prejudice was explained as the
requirement that the court give the offending party the opportunity to justify or correct
the default and explain why the case should not be dismissed. Franklin v.
6.
DaimlerChrysler Corp., 6th Dist. Lucas No. L-05-1244, 2006-Ohio-5620, ¶ 10, quoting
Asres v. Dalton, 10th Dist. Franklin No. 05AP-632, 2006-Ohio-507, ¶ 14.
{¶ 15} Appellees argue that appellant had implied notice under Loc.R. 4.01(D);
however, we find that this “notice” is not sufficient when juxtaposed against the harshest
sanction of a dismissal with prejudice. Further, Loc.R. 4.01(D) listed several possible
lesser sanctions.
{¶ 16} Regarding the opportunity to respond, the Supreme Court of Ohio reviewed
an action where the motion for sanctions was granted and the action was dismissed only
two days following its filing. Hillabrand v. Drypers Corp., 87 Ohio St.3d 517, 721
N.E.2d 1029 (2000). The court concluded that the party opposing the dismissal must be
given “the opportunity to respond at least within the time frame allowed by the
procedural rules of the court.” Id. at 519-520.
{¶ 17} This court has similarly and repeatedly found that a trial court is required to
provide notice prior to an involuntary dismissal. Buettner v. Horton, 6th Dist. Lucas No.
L-95-230, 1996 WL 139693 (Mar. 29, 1995). Such notice may be “where a party or his
or her counsel is present for a hearing or trial and is notified of the possibility of
dismissal by the court or by the opposing party’s motion to dismiss.” Id. at *2, citing
Carr v. Green, 78 Ohio App.3d 487, 491, 605 N.E.2d 431 (10th Dist.1992). See Torsok
v. Wesson, 6th Dist. Lucas No. L-98-1421, 1999 WL 576029, *5 (Aug. 6, 1999);
Montgomery v. Tenneco Automotive Operating, Inc., 183 Ohio App.3d 164, 2009-Ohio-
3394, 916 N.E.2d 530 (6th Dist.).
7.
{¶ 18} In the present case we must conclude that the trial court abused its
discretion by granting appellees’ motion to dismiss, with prejudice. As stated above,
appellees filed their motion on June 9, 2015, at approximately 11:00 a.m. The “Proof of
Service” indicated that the copy was mailed to appellant’s attorney on the same date. The
motion was granted less than four hours later. Certainly, appellant had not received the
mailing when the motion was decided and thus was neither on notice that the court could
dismiss its action nor had an opportunity to respond. Appellant’s first and second
assignments of error are well-taken.
{¶ 19} Appellant’s third assignment of error argues that the trial court erred, as a
matter of law, in failing to read R.C. 5311.04(E) in pari materia with R.C. 5311.05(A).
Similarly, in appellant’s fourth assignment of error it contends that because fewer than all
the unit owners signed the Third Amendment, there were no issues of fact precluding
summary judgment on the issue of unanimous approval. Appellant argues that reading
the two sections together necessitates a finding that the “unanimous approval” required
for amendments must be facially evident on the recorded instrument.
{¶ 20} R.C. Chapter 5311, Ohio’s Condominium Act, was enacted to address the
cooperative form of condominium ownership, the respective interest of owners in the
common areas, and the condominium administration. Belvedere Condominium Unit
Owners’ Assn. v. R.E. Roark Cos., Inc., 67 Ohio St.3d 274, 279, 617 N.E.2d 1075 (1993).
8.
{¶ 21} R.C. 5311.04(E) provides:
Except as provided in sections 5311.031 to 5311.033 and 5311.051
of the Revised Code, the undivided interest in the common elements of
each unit as expressed in the original declaration shall not be altered except
by an amendment to the declaration unanimously approved by all unit
owners affected. The undivided interest in the common elements shall not
be separated from the unit to which it appertains and is deemed conveyed
or encumbered with the unit even though that interest is not expressly
mentioned or described in the deed, mortgage, lease, or other instrument of
conveyance or encumbrance.
{¶ 22} R.C. 5311.05(A) states that “[a] declaration submitting property to the
provisions of this chapter shall be signed and acknowledged by the owner before a judge
or clerk of a court of record, county auditor, county engineer, notary public, or mayor,
who shall certify the acknowledgment and subscribe the certificate of acknowledgment.”
{¶ 23} The plain language of these provisions reveals no writing requirement for
an amendment to a condominium owners’ declarations; the requirement is that there be
unanimous approval. This fact was noted in a Second Appellate District case which
examined the validity of an amendment raising unit owners’ maintenance fees. Howley
v. Wythe Parish Homeowners Assn., Inc., 2d Dist. Montgomery No. 12506, 1991 WL
228708 (Oct. 2, 1991). In Howley, the amendment was approved and implemented in
9.
1985, but was not reduced to writing and recorded until 1989. Twenty of the 21 voting
owners signed the writing with the final member deceased. Id. at *1.
{¶ 24} The court examined R.C. 5311.04(D) which, though worded differently
than the current version, likewise required that an amendment to the declaration be
“unanimously approved by all the unit owners affected.” The court determined that the
section did not require that the amendment be in writing. Id. The court further found that
the statute did not require that the “amendment be filed either contemporaneously or
within a certain time.” Id. at *2.
{¶ 25} Reviewing the above-quoted statutes, we conclude that there is no
requirement that the unanimous approval be in writing or that it be filed within a certain
amount of time. Reviewing the matter de novo, Grafton v. Ohio Edison Co., 77 Ohio
St.3d 102, 105, 671 N.E.2d 241 (1996), we agree with the trial court that the affidavit of
the single unit owner who, due to a scheduling conflict, was not able to sign the
amendment is sufficient to raise an issue of fact as to whether the Third Amendment was
unanimously approved as required by statute. Appellant’s third and fourth assignments
of error are not well-taken.
{¶ 26} On consideration whereof, we find that substantial justice was not done the
party complaining and the June 9, 2015 judgment of the Wood County Court of Common
Pleas dismissing the action is reversed and the matter is remanded for further
proceedings. Pursuant to App.R. 24, appellees are ordered to pay the costs of this appeal.
Judgment reversed.
10.
Am. Ins. & Monetary, LLC v.
Holiday Park Condominium
Owners Assn.
C.A. No. WD-15-045
A certified copy of this entry shall constitute the mandate pursuant to App.R. 27.
See also 6th Dist.Loc.App.R. 4.
Mark L. Pietrykowski, J. _______________________________
JUDGE
Stephen A. Yarbrough, J.
_______________________________
James D. Jensen, P.J. JUDGE
CONCUR.
_______________________________
JUDGE
This decision is subject to further editing by the Supreme Court of
Ohio’s Reporter of Decisions. Parties interested in viewing the final reported
version are advised to visit the Ohio Supreme Court’s web site at:
http://www.sconet.state.oh.us/rod/newpdf/?source=6.
11.
Am. Ins. & Monetary, L.L.C. v. Holiday Park Condominium Owners Assn., Inc.
Combined Opinion