[Cite as Hicks v. Cadle Co., 2014-Ohio-872.]

IN THE COURT OF APPEALS

ELEVENTH APPELLATE DISTRICT 

TRUMBULL COUNTY, OHIO 

KERRY R. HICKS, : O P I N I O N 

 Plaintiff-Appellant, :

CASE NO. 2013-T-0017

 - vs - :

THE CADLE COMPANY, et al., :

 Defendants-Appellees, :

THE HOME SAVINGS AND LOAN 

COMPANY OF YOUNGSTOWN, OHIO, 

:

:

 Intervening Defendant. 

Civil Appeal from the Trumbull County Court of Common Pleas. 

Case No. 2011 CV 01148. 

Judgment: Affirmed. 

Kris J. Kostolansky, Lewis Roca Rothgerber, LLP, 1200 Seventeenth Street, Suite 

3000, Denver, CO 80202; Christopher S. Williams, Ronald M. McMillan, and John J. 

Eklund, Calfee, Halter & Griswold, LLP, The Calfee Building, 1405 East Sixth Street,

Cleveland, OH 44114 (For Plaintiff-Appellant). 

Victor O. Buente, Jr., Cadle Company, 100 North Center Street, Newton Falls, OH 

44444-1321; F. Dean Armstrong, Armstrong Law Firm, 1324 Dartmouth Road, 

Flossmoor, IL 60422 (For Defendants-Appellees). 

TIMOTHY P. CANNON, P.J. 

{¶1} Appellant, Kerry R. Hicks, appeals the February 22, 2013 judgment of the 

Trumbull County Court of Common Pleas denying his motion to compel arbitration with 
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regard to the amended counterclaims filed by appellees, The Cadle Company (“TCC”), 

Daniel C. Cadle (“Cadle”), and United Joint Venture Limited Partnership (“United”). 

Cadle is the former president and current owner and director of TCC, a debt collection 

company. TCC is the only general partner and registered agent of United, which is also 

a debt collection company. Based on the following, we affirm the judgment of the trial 

court. 

{¶2} The counterclaims at issue alleged that appellant violated Ohio’s Pattern 

of Corrupt Activities Act (R.C. 2923.31, et seq.), intentionally inflicted emotional distress, 

and tortiously interfered with the business relations of appellees and The Home Savings 

and Loan Company of Youngstown, Ohio (“Home Savings”). 

{¶3} Litigation between the parties began in September 2003, when Buckeye 

Retirement Co., LLC (“Buckeye”)1 sued appellant and his business partner, Mr. Jaeckle, 

in federal district court in Tennessee seeking to collect the outstanding debt on a 

promissory note. The various claims included allegations of tortious conduct on both 

sides. A history of litigation between the parties is detailed in three opinions of the 

United States Court of Appeals for the Tenth Circuit: Hicks v. Bank of Am. N.A. (“Hicks 

I”), 218 Fed.Appx. 739 (10th Cir.2007); Hicks v. Cadle Co. (“Hicks II”), 355 Fed.Appx. 

186 (10th Cir.2009); and Hicks v. Cadle (“Hicks III”), 436 Fed.Appx. 874 (10th Cir.2011). 

{¶4} Appellant and others obtained a loan from Bank of America (“BOA”) in 

1999; appellant was one of the signators on the note and two renewed versions thereof. 

However, appellant contended he was not liable on the balance of $1,000,000.00 

pursuant to an oral, collateral agreement with BOA—the amount that was outstanding 

 

1. Buckeye is another debt collection company and an alter ego of TCC and Cadle. Although Buckeye 

was involved at the beginning of the dispute between the parties, it is not a party to this appeal. 
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when Buckeye purchased the note from BOA in 2002. The note contains a provision 

requiring binding arbitration of: 

Any controversy or claim between or among the parties hereto 

including but not limited to those arising out of or relating to this 

instrument, agreement or document or any related instruments, 

agreements or documents, including any claim based on or arising 

from an alleged tort[.] 

{¶5} The note also contained a venue provision that any litigation would take 

place in Tennessee. In proceedings before the Tenth Circuit, the parties agreed that 

Tennessee law governed. 

{¶6} Shortly after Buckeye purchased the note, TCC, acting on behalf of 

Buckeye, attempted to collect the debt from appellant in an action filed in Tennessee. 

The debt collection activities of TCC and Buckeye are intertwined. TCC employees 

were, at times, also Buckeye employees. TCC employees, including Cadle, made 

collection calls and participated in collection-related correspondence in Buckeye’s 

name. TCC computer systems and phones were also used in Buckeye’s name. Three 

separate arbitrations in Colorado followed Buckeye’s efforts to collect from appellant. 

Appellant was successful in all three arbitrations and eventually obtained a large award 

against Cadle. The amount due on the note itself, if any, was assigned back to BOA in 

2003. 

{¶7} This Ohio action between appellant and appellees began in May 2011 

when appellant sought declaratory judgment and injunctive relief to prevent appellees 

from transferring assets belonging to Cadle, a principle of TCC and United. Cadle, 

TCC, and United were in negotiations with Home Savings to refinance an outstanding 

debt. Appellant was apparently concerned that funds from Cadle’s IRA account would 
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be used to pay Home Savings and would therefore not be available to satisfy the 

arbitration award. Appellant registered his arbitration award in the United States District 

Court for the Northern District of Ohio and brought suit in Trumbull County seeking to 

enforce the award. A temporary restraining order was issued, and the matter was set 

for hearing on appellant’s request for a preliminary injunction. Appellees then filed an 

answer, counterclaims, and a jury demand. 

{¶8} At a June 28, 2011 hearing, appellant’s request for a preliminary injunction 

was denied, and the temporary restraining order was dissolved. Thereafter, the 

arbitration award was paid, and appellant voluntarily dismissed his claims. With regard 

to appellees’ counterclaims, appellant filed a motion to stay litigation and compel 

arbitration or, in the alternative, to dismiss for failure to state a claim. While the motion 

was pending, appellees filed amended counterclaims. Cadle alleged violations of 

Ohio’s Pattern of Corrupt Activities Act (R.C. 2923.31, et seq.) and intentional infliction 

of emotional distress; furthermore, appellees together alleged tortious interference with 

business relationships. Appellees’ amended counterclaims cover conduct alleged to 

have occurred between 2007 and 2011. The trial court denied appellant’s motion to 

compel arbitration finding that appellees’ counterclaims were not subject to the note’s 

arbitration provision. 

{¶9} Appellant appealed this order and asserts a single assignment of error: 

{¶10} “Whether the Trial Court erred in denying Mr. Hicks’ Motion to Compel by 

finding that the Amended Counterclaims do not ‘arise out of’ or ‘relate to’ the Note and 

that Defendants are not bound by the Note’s broad arbitration provision.” 

{¶11} Under this assignment, appellant frames two issues for our determination: 
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[1] Whether Defendants’ Amended Counterclaims, which seek 

adjudication of factual allegations relating to the Note that were 

decided by or occurred in arbitration, “arise out of” or “relate to” the 

Note. 

[2] Whether Defendants are bound by the Note’s broad arbitration 

provision where TCC is an assignee of the Note and all prior courts 

and arbitration tribunals have held that Mr. Cadle and his agents 

and alter ego entities are so bound. 

{¶12} A trial court’s ruling denying a motion to compel arbitration is a final, 

appealable order. R.C. 2711.02(C); EMCC Inv. Ventures, LLC v. Rowe, 2012-Ohio4462, 11th Dist. Portage No. 2011-P-0053, 2012-Ohio-4462, ¶17. Generally, this court 

reviews a trial court’s ruling on a motion to compel arbitration for an abuse of discretion. 

Id. at ¶18. However, “this court reviews de novo a trial court’s legal conclusion as to 

whether a party is contractually bound by an arbitration clause.” Liberty Credit Servs. 

Assignee of or Successor in Interest to Capital One v. Yonker, 11th Dist. Portage No. 

2012-P-0096, 2013-Ohio-3976, ¶12. When deciding motions to compel arbitration, we 

look to the scope of the arbitration clause to determine whether the parties actually 

agreed to arbitrate the issue. Taylor v. Ernst & Young, L.L.P., 130 Ohio St.3d 411, 417 

(2011). 

{¶13} We recognize a presumption in favor of arbitration when claims between 

the parties to a contract fall within the scope of an arbitration clause. Id. Under both 

Ohio and Federal law, whether a party may be compelled into arbitration is a matter of 

contract. Id. at 416-417. Because the arbiter derives his power from the contractual 

consent of the parties, a party cannot be compelled to arbitrate a dispute that the party 

never agreed to submit to arbitration. Id. at 417. 

To determine whether the claims asserted in the complaint fall 

within the scope of an arbitration clause, the Court must ‘classify 
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the particular clause as either broad or narrow.’ An arbitration 

clause that contains the phrase ‘any claim or controversy arising 

out of or relating to the agreement’ is considered the paradigm of a 

broad clause. 

(Citations omitted). Academy of Medicine of Cincinnati v. Aetna Health, Inc., 108 Ohio 

St.3d 185, 188 (2006). Even a broad arbitration clause, however, does not render all 

claims subject to arbitration. Id. at 189. 

{¶14} The Ohio Supreme Court has held that whether a cause of action is within 

the scope of an arbitration agreement may be determined by applying the federal 

standard found in Fazio v. Lehman Bros., Inc., 340 F.3d 386 (6th Cir.2003). Academy 

of Medicine, supra, 188 (“[A] state court may rely on a federal standard in applying Ohio 

law on the issue of arbitrability. However, that standard must be consistent with Ohio 

law and must reflect a correct statement of the applicable federal jurisprudence. The 

appellate court’s reliance on Fazio is appropriate in both regards.”). Fazio held that “[a] 

proper method of analysis here is to ask if an action could be maintained without 

reference to the contract or relationship at issue. If it could, it is likely outside the scope 

of the arbitration agreement.” Fazio at 395. Fazio further stated: “Even real torts can 

be covered by arbitration clauses ‘[i]f the allegations underlying the claims “touch 

matters” covered by the [agreement].’” Id. 

{¶15} In Fazio, the Sixth Circuit found that claims relating to the theft of 

investors’ assets by their broker could not be maintained without reference to the 

account agreements, which contained the arbitration clause. Id. 

[I]t is evident that the fraudulent activities were a violation of the 

account agreements and arose out of activities contemplated by 

those agreements—the sale and purchase of securities and the 

management of accounts. The lawsuit by necessity must describe 

why [the defendant] was in control of the plaintiffs’ money and what 
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the brokerage houses’ obligations were. The plaintiffs therefore 

cannot maintain their action without reference to the account 

agreements[.] 

Id. The Fazio Test “allows courts to make determinations of arbitrability based upon the 

factual allegations in the complaint instead of on the legal theories presented. It also 

establishes that the existence of a contract between the parties does not mean that 

every dispute between the parties is arbitrable.” Academy of Medicine, supra, 191. 

{¶16} Furthermore, when the contractual agreement containing the arbitration 

provision has terminated prior to the dispute, the grievance is said to 

arise under the contract only where it involves facts and 

occurrences that arose before expiration, where an action taken 

after expiration infringes a right that accrued or vested under the 

agreement, or where, under normal principles of contract 

interpretation, the disputed contractual right survives expiration of 

the remainder of the agreement. 

 

Litton Fin. Printing Div. v. NLRB, 501 U.S. 190, 205-206 (1991). 

{¶17} Applying these principles, appellees’ claims can be maintained without 

reference to the note; the conduct of which appellees complain occurred, if at all, after 

the note was assigned back to BOA in 2003. Appellant was formally relieved of any 

possibility of liability on the note in 2004, when BOA assigned the note to a third-party, 

acknowledging appellant’s nonliability. Although Cadle controls TCC, United, and 

Buckeye, along with many other debt collection entities, he did not sign the note. The 

assignments indicate that Buckeye purchased the note from BOA and that Buckeye 

sold it back to BOA. Thus, at the very latest, any contractual relationship between 

appellant and appellees based on the note terminated in 2004. These facts are 

distinguishable from Fazio, where the conduct complained of occurred while a 

contractual broker-client relationship was in force. Furthermore, no action alleged 
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“infringe[s] on a right that accrued or vested under” the promissory note, nor is there a 

“disputed contractual right that survives” the note’s expiration. 

{¶18} As the trial court held, “the [amended] counterclaims all involved alleged 

tortious activities by [appellant] having no relationship to any particular term of the note 

or any right or obligation of any party under the note.” Cadle made the following 

allegations: (1) appellant falsely accused Cadle of stalking appellant’s wife and 

daughter; (2) appellant lured Cadle to a public meeting of company stockholders and 

there embarrassed him by having him detained and removed from the premises by 

police on the basis of an ex parte civil protection order appellant had obtained without 

Cadle’s knowledge; (3) appellant caused to be distributed a false report indicating that 

Cadle had filed for bankruptcy; (4) appellant caused the distribution of a false report that 

Cadle was a threat to the physical safety of appellant’s family and had personality traits 

consistent with a killer; (5) appellant filed duplicative litigation against appellees in 

Cadle’s hometown in order to embarrass Cadle; (6) appellant fraudulently obtained a 

temporary restraining order, which interfered with appellees’ business relations by 

enjoining the refinancing of a longstanding loan; (7) appellant threatened an IRS 

investigation of Cadle’s daughter if the counterclaims were not dismissed. All of these 

events are alleged to have occurred after termination of the relationship between the 

parties liable on the note. Thus, the dispute at issue is not “related” to the note. 

{¶19} On the basis of these allegations, appellees filed claims for intentional 

infliction of emotional distress, tortious interference with business relations, and 

engaging in a pattern of corrupt activity. None of these claims require reference to the 

note, as none seek to enforce any right or obligation or derive any benefit from the note. 
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This also contrasts with the situation in Fazio, where the claims involved theft and 

misuse of money entrusted to the broker. The relationship was based on account 

agreements that contained the arbitration clause. These very account agreements were 

allegedly breached by the broker’s misconduct. 

{¶20} Appellant’s reliance on Alexander v. Wells Fargo Fin. Ohio 1, Inc., 122 

Ohio St.3d 341 (2009), is also misplaced. In Alexander, the Ohio Supreme Court 

consolidated two cases involving statutory rights. Id. at 342. The first involved an 

action for failure to timely file an entry of satisfaction of a mortgage. Id. The second 

involved an action for failure to timely file a termination statement. Id. at 343. The 

underlying contracts—the mortgage and the loan agreement, each of which contained 

an arbitration clause—were necessary to the claims because the statutory right 

underlying the claims can arise only from the execution and satisfaction of such credit 

agreements. Id. at 342, 345-346. Without proving the existence and terms of the 

underlying agreements, neither plaintiff would have been able to demonstrate that their 

creditor had failed to fulfill the statutory obligation to timely file an entry of satisfaction or 

a termination statement. Id. Thus, the claims could not be maintained without 

reference to the underlying agreements. 

{¶21} Here, appellees’ counterclaims do not rely on a statutorily-created right 

that arises only in the presence of a valid and satisfied mortgage or loan agreement. 

Instead, appellees’ claims sound in tort and require no proof that the agreement existed. 

If the alleged conduct occurred, it could be actionable even if there was never an 

agreement between the parties. In Alexander, the claims could not exist unless the 

agreements existed. That is not the case here. 
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{¶22} Appellees further assert that this case is analogous to Dodeka, L.L.C. v. 

Keith, 11th Dist. Portage No. 2011-P-0043, 2012-Ohio-6216. In that case, we found 

that a person who was not shown to have expressly or implicitly assented to a 

contractual arrangement was not subject to an arbitration provision contained within the 

purported contract. Id. at ¶35. We affirm that the claims at issue here do not fall within 

the scope of the arbitration provision. The argument that appellees did not assent to 

being bound by the note’s arbitration provision is moot. 

{¶23} Finally, appellant, in a section of his appellate brief entitled, “Standard of 

Review,” states: “Whether the Trial Court properly denied Mr. Hicks’ request for limited 

discovery as to the relationship between United and Mr. Cadle and TCC is reviewed for 

abuse of discretion. See Wells Fargo & Co. v. Wells Fargo Express Co., 556 F.2d 406, 

430 fn. 24 (9th Cir.1977).” There is some further discussion near the end of appellant’s 

brief that indicates appellant would like further discovery as to the relationship between 

Cadle and United. However, as appellant assigns no error in this regard, we decline to 

address the discovery issue. See, e.g., App.R. 16. 

{¶24} Appellant’s sole assignment of error is without merit. The judgment of the 

trial court is affirmed. 

DIANE V. GRENDELL, J., 

COLLEEN MARY O’TOOLE, J., 

concur.