[Cite as Vandercar, L.L.C. v. Port of Greater Cincinnati Dev. Auth. , 2022
- Ohio

- 3148.] 

### IN THE COURT OF APPEALS FIRST APPELLATE DISTRICT OF OHIO HAMILTON COUNTY, OHIO

VANDERCAR, LLC , Plaintiff

- Appell ee/Cross

Appellant ,

vs. THE PORT OF GRE ATER CINCIN NATI DEVELOPMENT AUTHORITY , Defend ant

- Appell ant/Cross

Appellee. :

:

:

:

:

:

: APPEAL NO S

. C

- 210 643 C

- 210665 C

- 2 20130 TRIAL NO. A

- 200 900

O P I N I O N

.

Civil Appeal s From: Hamilton County Court of Common Pleas Judgment s Appealed From Are : Affirmed in P art, Reversed in Part, and Cause Remanded Date of Judgment Entry on Appeal: September 9, 2022

T aft Stettinius & Hollister LLP , W. Stuart Dornette , Russell S. Sayre and Beth A. B ryan , for Plainti f

f

- Appel lee/Cross

- Appellant , C alf ee, Halter & Griswold LLP , Mitchell G. Blair , Matthew A. Chiri costa and David T. Bules , for Defendant

- Appell ant/Cross

- Appellee

.OHIO FIRST DISTRICT C OURT OF APPEA LS

2 M YER S , Presiding J udge. 

### {¶1} The deterioration of the Millennium H o tel in dow n town Cincinnati h ad long been an obsta cle to the city ’ s effo rts to att ract convention bu siness. In 2019, Vandercar , LLC, entered into a $36 million p urchase contract with the hotel ’ s f orme r

owners in order to facilitate the redevelopment of the hotel “ as a four

- star (or b ette r) convention center hotel

. ” Several m onths later, Vandercar assigned i ts int erest in the contract to the Port of Greater Cincinnati Development Authority ( “ the P o rt ” ) in exchan ge for two potential fees tot al ing $7.5 million

. The Po rt acquired the ho tel property and paid Vandercar one o f its potential fees, in the amount of $2.5 million

. However, a lthough dem olition on the Mill en n ium Hotel was completed in 2022, the dust has not yet se ttled on the parties ’ dispute over the Port ’ s ob ligation to pay Va nde r car the second fee of $5 million

. 

### {¶2} Va ndercar sued the Port for breach of contract and bad faith , claiming it was owed additional fees when the Port issued revenue bonds that included funds for demolition of the hotel and other activ ities that Vande rc ar claimed were for redevelopment . The tr i a l court granted summary judgment in Vandercar ’ s favor on it s breach

- of

- contract claim in the amount of $5 million , but denied its motion for prejudg ment interest. The court granted the P ort ’ s motion for parti al judgment on the pleadings on Vandercar ’ s b ad

- faith claim. Both parties have appealed

. 

### {¶3} Because we find that the contract is clear and unambiguous in re quiring
t he Port to pay V andercar i ts $5 million fee , we affirm the trial court ’ s g rant of
summary ju dgment in favor of Vandercar o n its breach

- of

- contract claim. And because prejudgment interest cannot be assessed against the P ort as an arm of the
state in the absen ce of statut ory or contractual authority, we affirm the trial court ’ s d enial of Vanderc ar ’ s m otion for prejudgment interest. Finall y, because Vandercar ’ sOHIO FIRST DISTRICT C OURT OF APPEA LS

3 bad

- faith claim was sub sumed in its breach

- of

- contract claim, w e hold t hat the trial court properly dismissed the bad

- fait h claim as a separate, stand

- alone cause of action

. However, beca us e we find that Va ndercar has alleged that the Port acted in bad faith, we reverse the trial court ’ s gra nting of judgment on the pleadings as to the recovery of attorney fees and remand for further proceedings

. Factual B

ackground 

### {¶4} On Ju ly 1, 2019, Vand e r car ente red into a Purchase and Sale Agreement ( “ the Purchase Contrac t ” ) with Cincinnati S.I. Co., the owner of the Millennium Hot el , to purchase the p roperty for $36 million

. The Pur chase Contract was amended on August 27, 2019 , and on S eptember 13, 20 1 9
. 

### {¶5} On October 4, 2019, Vanderc ar assigned its rig hts under the Pu rchase
Contrac t to the Port in an Assignment and Assumption Agreement, and the parties

e ntered into an Agreement Regarding Assignment ( “ the A greement ” )

. The Agreement provid ed : TH IS AGR E E ME NT REGARDING ASSIGNMENT (the “ Agreement ” ) is entered into effective as of the 4th day of October, 2019 (the “ Ef fective
Date ” ), by and between VANDERCAR, LLC, an Ohio limited liability
company ( “ Vandercar ” ), and THE PORT OF GRE ATER CINCINN ATI
DEVELOPMEN T AU THO RITY , a port autho rity and p olitical subdivision and body corporate and poli tic duly organized and validly

e xist ing u nder the laws of the State of Ohio ( “ Port ” ), under the following circumstanc es: A

. Vandercar is a party to th at certa in Purchase an d Sa le Agreement with Cincinnati S.I. Co ., an Ohio limited partne rship ( “ Seller ” ) dated as of July 1, 2019 , as amen ded by that cert ain First Amendment to Purchase and Sale Agreement date d as of August 27, 2019, and as furt her amended by that Second Amend m e n t to Purchase and SaleOHIO FIRST DISTRICT C OURT OF APPEA LS

4 Agreement da ted as of September 13, 2019 (as so amended , and as may be further amended and /or supplemented from time to time, together, the “ Contract ” ). A true , correct, and co mplete copy of the Contract is attached hereto as Exhi b i t A and incorporated herein. B. Under the Contract, among other things, Vandercar has ag reed to purchase, and Se ller has agre ed to sell, certain Real Pro perty (as such term is de fined in th e Contract) 1 located in the City of Cincinnati,
Ha milton County, O hi o, on which is located the Millen nium Hotel Cincinnati.
C. Port wishes to acquire th e R eal Prop erty in order to re develop , o r
cause to be re de veloped , the Real Property for a new hotel (the

“ Project ” ) , which such acq uisition of the Real Property may b e fi na nced with t he proceeds of revenue bonds issued by the Port Authority (the

“ Property Ac quisition Bonds ” ), and s uch redevelop ment will be financed with the proceeds of revenue bond s issued by th e Port Authority (the “ Redevelopment Bonds ” ) . The Propert y Ac qu is ition Bonds and the Redevelopment Bonds may be issue d at the same time as part of on e issuance of bonds or , alternatively , may be i ss ued on separate dates as determined by the Port. 

### {¶6} After setting forth certain obligations of the p arti es, the Agreem e n t provide d for certain payments to Vandercar. One of these w as to occur upon th e closing of the property ( “ Development Fee ” ), and another was to be paid upon the iss u ance of Redevelopment Bonds ( “ Redevelopment Fee ” ). Speci fically, the Agr eement provi d ed in rel evant part :

1 The “ Real Property ” referr ed to in the A greeme nt was defined in the July 1 , 2019 P urch ase C ontract to include the L and and I m provement s at the Millen nium Ho tel site.OHIO FIRST DISTRICT C OURT OF APPEA LS

5 D. Port desi res to a ssume V andercar ’ s rights and obligations under the Contract, and Vandercar desi res to assign s uch rights and obligations to Port, subject, however , to the terms, conditions, and provisions of this Agre ement.



### 1. Develo

pme nt F ee and Expenses in Connection with the P roperty Acquisit ion and the Con tract

.
a. On the Cl osing Dat e of the a cquisition of the Real Property, Port sh all p ay Vandercar: i. a “ Development Fee ” of $2,500,000.00 ; ii. A n amount of $250,000 .00 to re im burse Vanderc ar fo r its payment to the Seller of the Initial Deposit re quired under the Contract; iii. An amoun t not to exceed $175,000.00 to reimburse Vandercar f

or the fees and expenses incurred by Vandercar in connection with t he initial due diligence with r espect to the Co nt ract, such amount to be paid to be evidenced by in voi ces provided to the Port with sufficient detail as to th e wor k performed; and iv. An amount not to exceed $47,5 00.00 to reimburse Vandercar for the fees and expenses of Gover nmen t Solutions in connectio n w it h the Contract

.

* * *



### 2. A dditional Vanderc ar Redevelopment Fee

. The Port sha ll use commercially reason able efforts to issue the Redeve lopment Bonds within one year from the date of the closing of the purchase of the Real Property[.] * * * The Port shal l n ot use or allow to be used any other method of financing the de velopment of t he Pro ject unless suchOHIO FIRST DISTRICT C OURT OF APPEA LS

6 financing causes and allows for the payment of the $5,000,000.00 redevelopment fee described below. If the cl osing of the Redevelopmen t
B on ds occurs wit hi n t hat one

- year p eriod (as may be e xtend (sic) due to force majeure even t), on such date of closing of the Redevelopment Bonds[,] the Port shall pay Vandercar an additional amount of $5,000,000.00. (Emp hasis sic.) 

### {¶7} On J anuary 15, 202 0 , the P ort ado pted Reso lu tion No. 2020

- 04 ( “ the January Res olution ” ) , authorizing the issuance and sale of revenue bonds. The January Resolution provided : WHEREAS, the Port of Grea ter Cincinnati Dev elopment Authority (the

“ Port ” ), * * *, authorized and empowered * * * ( 1) to is su e revenue bonds in one or more series for the p urpose of financing costs of acquiring, constructing, installing, equipping or im proving “ port authority fac il ities, ” as def

ined in Section 4582.21 , Ohio Revised Code

* * * WHEREAS, pursuant to Boar d Resolu ti on No. 2019

- 26 ado pted on September 27, 2019, the Port entered into an Agre ement Regarding Assignment dated as of O ctober 4, 2019, with Vandercar, LLC ( “ Vandercar ” ), under whic h the Port accepted an assignment of Vandercar ’ s rights, inte r ests and obligat io ns under a Purchase and Sale Agreement dated as of July 1, 2019 (the “ PSA ” ) with Cincinnati , S. I. Co.,

as am ended, and pursuant thereto, the Port intends to ac quire and demolis h 2 (i) the Millennium Hotel, Cincinnati, Hamilton County, Ohio

2 We note that “ ac quire a nd demolish ” does not modify the second phrase of th i s sen tence and have i n terpreted the plain language to be: the Port int ends (1) to acquire and demolish the Millennium Hotel and (ii) to evaluate the t iming , scope and size of ne w convention facilities, in clud ing a new hotel. This is consiste nt with bo th parti es ’ arguments.OHIO FIRST DISTRICT C OURT OF APPEA LS

7 and cer t ain oth er buildings and improv em ents located upon the Project Site (define d herein ), and (ii) to evaluate the timing , scope and size of the construction of new convention facilities, inc luding a new hotel, and an expansion of the convention center on all o r a por ti on of the Project Site ( collectively , t he “ Project ” ) ; and WHEREAS, upon advi ce from the Port ’ s sta ff, this Board has determined that it is necessary and proper an d in the best i nterest of the Port to issue revenue bonds in one or more ser ies in t h e maxim um
aggre ga te principal amount of $59,000,000 ( “ Bonds ” ) in anticipation of the issuance of addi tional revenue bonds to pay for the costs of the Project[.] 

### {¶8} The January Resolution then authorized the issuance of the bonds. In it , the Port ag re e d to use the bo nd proceeds to pay a portion of the Proj ect ’ s costs. The Project is defined in the January Resolution as acquisition, demolition, and evaluation of the site. 

### {¶9} Spec ifically, the January Resolution provided: The Port will use the proceeds of the Bonds to pa y a portion of the costs of the Project and pay or reimburse related costs, to pa y c ertain costs of issuance of the Bo nds, to make the capit alized interest deposit , if any, and to fund a debt service f und if required by the Original Purch as e r. 

### {¶10} On Februar

y 12, 20 20, the Port adopted Resolution No. 2020

- 11 ( “ the Februa ry Resolution ” ) authorizing it s president to enter into contracts for the remediation, d emolition, an d preconstru ction at the Millennium Hotel site an d for the development and co nstruction o f ne w conv ention facilities, including a convention center hote l, at the site. The February Resolution reitera ted that th e revenue bonds authorized by th e January Resolution woul d be used to “ pay the cost of acquiri ng the Project Site and de molis hing th e Mill en nium Hotel and evaluating the timing, scopeOHIO FIRST DISTRICT C OURT OF APPEA LS

8 and size of the construction of new convention facilities, inclu ding a new hotel, an d an expansion o f the convention center [. ] ” 

### {¶11} On February 1 3 , 2020, the Port iss ued revenue bonds ( “ the Febr ua ry

revenue b onds ” ) i n the a mount of $52 .855 million, whi ch were titled “ Port of Greater Cincinnat i D evelopment Authority Revenue Bon ds, Series 2020 (Convention Center Hotel Acquisition and Demoliti on Project). ” 

### {¶12} On February 14, 2020, the Por t c losed on it s acqui sitio n of t he r eal
p roperty and paid Vandercar i ts $2.5 million Development Fee (plus exp ens es) , pursuant to Par agr aph D(4) o f the A greement

. 

### {¶13} On Febru ary 18, 2020, Vandercar s ubmitted an in v oice to the Port for the $5 million A dditiona l Vander ca r Redevelopmen t Fe e described in Paragraph D(5) of the A greement

. In its letter accompanying the invoice, Vandercar ass erted that the Febr uary revenue bonds wer e issued for purpo ses other than simply property acquisi tion and were Rede v el opment Bonds issue d within one y ear of closing , which triggered the Port ’ s obligation to pay Vandercar ’ s R edevelopment F ee. 

### {¶14} On February 24, 2020, Van dercar su ed the Port after it did no t pay the
Re development F ee. Procedural His tory 

### {¶15} In its complain t, Va ndercar alleg ed tw o ca uses of ac tion: breach of contract and bad faith. Vandercar alleged that the $5 2.855 million February r evenue bonds issued by th e Port included approximatel y $39 million to acquire t he Project sit e and to pay Vander car ’ s $2.5 milli o n Development Fee , a nd the balan ce to begin redevelop ment activities, including demolition of the Mille nnium Hotel

. It alleged that the Port breached t he Agreement when it faile d to pay t h e $5 million Rede velop ment Fee owed to Vand ercar when the Port issu ed “ Re de velopment Bo nds , as defi n ed un der the A greement , ” as part of t he February r evenue bond issuance

. Vandercar also alleged that the Port acted in bad faith by refusing to pay theOHIO FIRST DISTRICT C OURT OF APPEA LS

9 Re dev elopment Fee and by structur ing t he bond i ssue to disguise the dem ol itio n and other re development activ i ty as something othe r than redevelopment. 

### {¶16} After the Port filed its Answer, Vandercar moved for judgment on the ple ad ings , seeking judgment in its favor on both its breach

- of

- contract and ba d

- fa ith

c laims. Vandercar as ked the court to a wa rd it $5 mil lion i n damages as well as its attorney fees. The tri al court denied the motion, finding that genuine issues of
mat eria l fact remained to be determined. 

### {¶17} The Port then mo ved for partial judgment on the pleadi ngs as to
V and er car ’ s bad

- faith cl ai m , arguing t hat th e claim was not a legally cognizable, free

standing c ause of action under Ohio law. 

### {¶18} Before the court ruled on the Port ’ s motion , and following discovery, Vande rcar moved for summary jud gment on its breach

- of

- contract c laim. Then the
Po rt moved fo r s ummary judgment on bot h the breac h

- o f

- contract and bad

- faith clai ms. Both parties ar gued that the Agreement was cle ar and unambiguous. Vandercar argued that it was entit led to its $5 mil li on Redevelo pment Fee because t he February revenu e bond s included b oth Pr operty Acquisitio n Bonds and Redev elopment Bonds. The Port argued that the February revenue bonds consi sted

o nly of Property Acquisition Bonds , and that it was not o bl ig at ed to pay the Rede velopment Fee because i t did not issue Red evelop ment Bonds t o cons truct a new hotel. In addition, the Port argued that Vandercar ’ s bad

- faith claim fail ed as a matter of law be cause there was no evidence of bad faith. 

### {¶19} T he trial court he a rd a rguments on the Port ’ s motion for partia l judgment on the plead ings and on both m otions for s ummary j ud gment. A t the end of the hearing, the trial c o urt orally announced its decision g rantin g summary judgment in favor of Vandercar on its breach

- of

- co ntract claim and awa rding Vanderc ar i ts $5 mi llion Re d evelopme nt F ee , denying th e Port ’ s mot ion for summary judgment, and gran ting the Port ’ s motion for pa rtial judgment on the pleadin gs as toOHIO FIRST DISTRICT C OURT OF APPEA LS

10 Van dercar ’ s bad

- faith claim

. Before the court issued a judgmen t entry , Van dercar filed a motion for pre

judg ment interest. 

### {¶20} The tr ial court th en iss ued a judgment entry d isposi ng of the mo tions. In granting summary judgment in favo r of Vandercar on its brea ch

- of

- contra ct c

laim , and denying summary judgment to the P ort on that claim, the trial court stated : T he Court finds that there is no dispu ted is sue of material fact that the Port issued reve nue bonds to acquire the property, and also redevelop the proper ty b y beginn ing demo lition of the Millennium Hotel. As such, Vandercar is entitled to judgment as a ma tt er of law on Coun t One of the Compl aint. The $5

- Million

- Dollar Redevelopment Fee defin ed in the con tract was triggered, and is owed

. 

### {¶21} The court rejecte d the Port ’ s con tention that demo li tion of the Millennium Hotel “ was paid for by issu ance of P roperty Acq u isition Bonds, w hich

w ou l d not tri gger t he Redevelopment Fee. ” The court explained th at it considered no extrin sic evidence in reaching its deci sion , and it foun d th at the langua ge in the
A greement was unambiguous

. After looking t o the dictionar y defini tions of

“ a cqui si tion ” and “ r edevel opment ” to find the plain meaning of the te rms used in the
A greem ent, the court s tate d : The Cour t reads a cquisition to re fer solely to the gaining possession of the property . The term Redevelopment would be applie d to e v erything else aft er ac q uisition lea ding u p to construction of a new hotel. This includes demol ition of the previous b uilding. 

### {¶19} In dismissing Vandercar ’ s bad

- fai th claim, the court stated that , al though it was clear that the parties disagreed as to whether the Redevelopment Fee

w as owed, “ a disput e with re gard to contract interpretation is not bad faith in this

case. ”OHIO FIRST DISTRICT C OURT OF APPEA LS

11 

### {¶20} Aft er t he court i ssued its judgment entry dis posi ng o f the motions , the
Port appealed in t he case numbered C

- 210643. Vandercar filed a cross

- appeal in the

ca se num bered C

- 210 6 6 5, bu t asserted that the Port ’ s appeal was premature under App.R. 4(B)(2) (f) because Vandercar ’ s motion for prejudg ment interes t remained pending in the trial court

. 

### {¶21} This court stayed the appeal s and r emanded this case t o the trial court
to re solv e the pr ejudgm e nt

- interest motion. The trial court de nied the motion . The court found that prejudgment interest could not be le vi ed upon the s tate in the absence of a st atute requiring it . The court found that the Port was an arm or inst rument ali ty of the state becau se it was created by, and its powers and authorities are defined by, the R e vised Code. Because the court foun d that no statute required the imposition of prejudgment in terest on an arm or inst rumentality of the sta te, t he court ref used t o award prej udgmen t interest against the Port. 

### {¶22} Following t h e trial court ’ s denial of the motion for prejudgment interest , Vande rcar filed the appeal in the case numbered C

- 220130
. The Port

’ s Appe al 

### {¶23} In two assignment s of error, the P o rt c hallenge s th e tria l court ’ s
gr anting of summary ju dgment in Vande rcar ’ s favor on the breach

- of

- contract claim and d enying the Port ’ s summary - judgm ent motion on the same claim. The Port argues that it did not breac h the A greement with Vandercar b y not payi ng the $5 mi llion Redevelopmen t Fe e. According to th e Port, i t did not issue Redevelopment Bonds that

wo uld trigger its obligation to pay the Red evelopment Fee , because the A greement defined “ Redevelopment Bonds ” as revenue bonds issued to construct a new hotel

. 

### {¶24} We rev ie w a trial co urt ’ s ruling on a motion for summary judgment de

nov o . Grafton v. Ohio Edison Co

. , 77 Ohio St.3d 102, 105, 671 N.E. 2d 2 41 (1996). Summary j udgment is appropriately granted when th ere e xists no genuine issue of material fac t, the party m o ving for summary judgme nt i s entitled to judgment as aOHIO FIRST DISTRICT C OURT OF APPEA LS

12 matter of law, and the evidence, when viewed in favor of the nonmoving party, permit s only one reasonable conclusion that is adverse to that pa rty. State ex rel. Howard v

. Ferreri , 7 0 O hio St.3d 587, 5 89, 639 N.E.2d 1 189 (1 994 ). 

### {¶25} In interpret ing a contract, our role is “ to give effect to the inte nt of the
p arties to the agreement

. ” Motor ists Mut. Ins. Co. v. Ironics, In c ., Slip O pinion No.

20 22
- Ohio

- 841, ¶ 8, qu oting Westfield Ins. Co. v . Galatis , 100 Ohio St.3d 216, 2 003
- Oh io

- 5849, 797 N.E.2d 1256, ¶ 11. We m ust “ examine the contract as a w hole and presume that th e intent of th e parties is reflected in th e language of the contract. ”
Sun oco, Inc. (R&M) v. Toledo Edison Co ., 129 Oh io St. 3d 397, 201 1
- Ohio

- 27 20, 953 N.E. 2d 285 , ¶ 37. Contract terms that are clea r and una mbiguous “ s hould be applied as written. ” Sutton Bank v. Prog ressive P olymers, L

. L

. C

. , 161 O hio St.3d 387, 2020
- Ohio

- 5101, 16 3 N.E.3d 546, ¶ 18. “ [C]ommon words appe ar ing in a writte n instrum ent will be given their or dinary meaning unless manifest a bsurdity results, or unless some other meaning is clearly evidenced from the face or overall conte nts of the i ns trument. ” Id. at ¶ 15, quoting Alexan der v. Buckeye Pipe L i ne Co ., 53 Ohio S t.2d
241, 374 N.E.2d 146 (1 9 78), parag rap h two of the syllabus. 

### {¶26} Wh ere the terms in a contra ct are clear and una mbiguous, courts

“ can not in e ffect create a new contract by finding an intent not expr essed in the clear language e mployed by the partie s. ” Al e xander a t 246. Wher e term s are not defined in the contract , court s rely upon dict ionary definitions of the terms to determine their plain an d ord inary meaning. Id. at 247

- 248 (a pplying dict ionary def initions of

unam biguous contract term s ) ; Mr. Pu lpstone , LLC v. Shops on 58, LLC , 9th Dist. Lorain No

. 21CA011718, 2021

- Ohio

- 4467, ¶ 11 ; Sunoco at ¶ 38

- 39 (cou rt look ed to diction ary defini t ions of “ arrangement ” because the term was not defined in the
pa rties ’ a greem ent); Nationwide Mut. Fire Ins. Co. v. Gu man Bro s. Fa rm , 73 Ohio St.3d 107, 109, 652 N.E. 2d 684 (1995) (cou rt applied Black ’ s Law Dictionary defini tion of “ employee ” w here the te rm was not defined in parties ’ contra c t)

.OHIO FIRST DISTRICT C OURT OF APPEA LS

13 

### {¶27} In this case, b oth part ies asse rt that t he A greement ’ s t erms ar e clear and unamb iguou s , a nd that the A greem ent contemplated two types of re venue bonds: Property Acquisition Bonds and Redev elopment Bonds

. They agr ee that , pursuant to Paragraph D(4) of the Agreement , the Po rt paid Van dercar ’ s $2.5 million Develop ment Fee on the closin g date of the acquisi tion o f the Real Property. The y di sagree , however , on the mea ning of the term “ Redevelopment Bonds ” in the Agree ment and whether the February revenue bond issuance incl uded Re d e velopmen t
B onds

. 

### {¶28} The Port argues that th e Februa ry revenu e bonds w ere solely P ropert y Ac quisition Bonds, which it issued t o finance acquisition , site stud ies, and demolition of the o ld Millen nium Hotel. Vandercar argues that the February revenue bonds consisted of both Property Acquisition Bond s and Re de vel opme nt Bon ds

. In sup port of th eir respect ive positions, b oth parties point to Paragraph C of the A greemen t , which we set forth again:
C. Port wishes to acquire the Real Property 3 in order to redevelop, or cause to be rede ve loped, the Re al Pr operty for a new hotel ( th e

“ Project ” ) , whic h such acquisition of the Real Property may be financed with the proceed s of revenue bonds iss ued by the Po rt Authority (the

“ Property Acqu isition Bonds ” ), and such redevelopment will be finan ce d with the pr oceed s of revenue bond s issued by the Port Author ity (the “ Redevelopment Bonds ” ). The P roperty Acquisition Bonds and the Redev el opment Bonds may be issued at the same time as part of one issuance of bonds or , alternatively, may be issued o n separate dates as d etermined by t he Port. (Em p hasis sic.)

3 The Real Property referred to in the A greeme nt was defined in the July 1, 2019 P urch ase C ontract to include the L a nd and I m provement s at the Millen nium Ho tel site.OHIO FIRST DISTRICT C OURT OF APPEA LS

14 

### {¶29} The A

greemen t is clear and unamb iguous. It provi des f or Property Acquisition Bonds to acquire the property and R e development Bonds to redevelop the
pro perty. The only re maining question is whether demo lition and site studies are par t of “ acq uisition ” or “ rede velopment. ” 

### {¶30} Vandercar argues that “ acquisition ” means what it says, and doe s not include dem olition. Rat her, demolition and site studies are part of “ redevelopment. ” 

### {¶31} The Port claims that demolition is part of acquisition, an d not

re d evelopment. The Po rt co ntends that the only rea sonable construction of “ such red evelopment ” in th e conte xt of the Agreement is “ re develop[ing ] the Real Property for a new hotel ”

— the explicit antece dent in the first clause of the sentence. The Por t contend s that Redev elopme nt Bonds can on ly be those issued to finance “ a n ew hotel , ”

an d do not include bonds issued for acqui sition, dem olition of the old hotel, or other

ac tivities that do not re sult directly in “ a new hotel. ” The Port claim s that not hing in
P aragraph C p revent ed its use of Pro perty Acqu isition Bonds to finance both acquisition and what it calls “ pre - development activities, ” such as site stud ies and demolition, without triggering t he Redevelopment F ee. 

### {¶32} The Port also argues that the fin al senten ce of Paragr aph C me an s that the parties inten ded either one issu ance of bonds to pay for everything from acquisition to new hotel construction, or t wo sepa rate issuances of bonds in am ounts sufficient to cover acquisition and construction of a ne w hotel, respectively

. Thi s sentence provided th at “ The Property Acquisition Bond s and the Rede vel o pment Bonds may be issued at the same time as part of one issu ance of bonds or, alternatively, may be issued on separate dates as determined by the Port. ” Ho wever, nothing in t he fin al sentence l imits the Port to a single issuance of Red evelopment Bonds. Under t he clear language of the contract, the Port could issue Property Acquis ition Bonds and Redevelop ment Bonds “ at the same time as part of one issu an ce of bond s , ” or “ onOHIO FIRST DISTRICT C OURT OF APPEA LS

15 se parate dates

. ” So , as Vandercar correctly asserts, a single bond issuance cou ld include only Property Acquisition Bonds, only Redevelopment Bonds, or som e of each. 

### {¶33} The Agreement did not define “ acquisition ” or “ redevelopment, ” and def ined “ Pro perty Acquis ition Bonds ” only as bonds issued to acquire th e Real Property and “ R e development Bonds ” as those issue d for redevelopment of the Real
Pro perty. Because the A greement did not define the terms “ Property Acquisiti on Bonds ” or “ Redevelop ment Bond s ” beyond th is gen eral descri ption , we turn , as the trial court d id, t o dictionary defini tions of the terms to determine their plain and ordinary meaning. T he A greement allowed the proceeds o f Property Acqui siti on Bonds t o finance “ such acquisiti on of the R eal Proper ty

. ” The word “ such ” refers back
to the opening clau se ’ s reference to the Port ’ s wish to “ acquire the Real Property. ” The plain an d ordinary meaning of “ a cquis ition ” is “ [t]he gaining of possession or control

ov er something; esp. , th e a ct of ge tting land , po we r, money, etc. ” B lack ’ s Law Dictionary (11th Ed.2019). Thus, the Property Acquisition Bonds are limited to the acquiring of t he property and nothing more. 

### {¶34} That leads us then to what is a Redev elopment Bond

. The A greement
pro vided tha t the procee ds o f Redevelopment B onds were to be used to finance “ such

r edevelopment , ” referring to the introd uctory clause “ Port wishes to acquire t he Real Property in order to redevelop, or cause to be redeveloped, the Real Property for a new ho tel[.] ” The plain an d or d i nary mea ning of “ Redevelopment ” r efer s to

“ [r] ehabilit ation of an urban

- residential or comme r cial section that is subje ct to blig ht or in decline, esp. by erecting new bu ildings or renovating the ol d ones, often with public finan cing or t ax - increment f in an cing. ” Black ’

s Law Dictionary (1 1th Ed.2019). 

### {¶35} Applying these dictionary definition s , we agree with the trial cour t that , as used in the A greement, “ a cquisitio n ” refers only to the Port ’ s gaining of possession or contro l o f the Rea l Property. We fi nd that redevel opment andOHIO FIRST DISTRICT C OURT OF APPEA LS

16 rehabilitation include demoli tion, site st udies, and the like. Thus, the revenue bonds were issued by the Port for both acquisition and redevelopment of the site. 

### {¶36} Our conclusion is bolstered by the Por t ’ s own d escription o f the bo nds. The issuance was described as “ Convention Center Hotel Acquisition and Demolition Project. ” The Port itself made a dis tinc tion between “ Acquisition ” and “ Demolition. ” And it also did so in the Januar y Res o lution where i t used th e separate t erms o f

“ acquis ition ” and “ de molition. ” 

### {¶37} If we were to adopt the Port ’ s position as to the meanings of “ Property Acquisit ion Bonds ” and “ R e development Bonds, ” we would effectively be rewriting the parties ’ agreement , whic h we will not d o. See B e verage Hold ings, L.L.C. v. 5701 Lombardo, L.L.C. , 159 Ohio St.3d 194, 2019

- Ohio

- 4716, 150 N.E. 3d 28 , ¶ 25 , qu oting Foster Wheeler E nvi respon se, Inc. v. Franklin Cty . Convention Facili ties Auth. , 78 Ohio St.3d 353, 362, 678 N.E.2d 5 19 (1997) ( “ To t h e exten t that [ one of the parties ] may be dissa tis fied with the purchase price th at resulted from the plain language agreed to by the parti es, ‘ [i]t is not the responsibility or fu nction of this court to rewrite the parties ’ contract in or der to provide for a mor e equitable result ’ ” )

. 

### {¶38} We hold that the trial court properly entered summary judgment in favor of Vandercar on its breach

- of

- contract claim (and denied summary judgment to the Port on the same claim) because no gen uine issue of fa c t remained

— un der the
p lain meaning of th e terms used in the partie s ’ Agreement , the February revenue bonds included Redevelopment Bonds which triggered the Po rt ’ s obligation to pay Vandercar ’ s $5 million Redevelopment Fee. Therefore, we o verrule the Port ’ s first and

s econd ass ignments of error. V andercar

’ s Appeal 

### {¶39} In two assignments of error, Vandercar argues that the trial court erred by grant ing the Port ’ s Ci v.R. 12(C) motion for judgment on the pleadings on its bad

-OHIO FIRST DISTRICT C OURT OF APPEA LS

17 faith claim and by denying its motion for prej udgmen t interes t on its awa r d for the breach

- of

- contract claim.
A. Bad - Faith Claim 

### {¶40} Dismissal on a Civ.R. 12(C) motion for judgment on the plea dings is
pr oper when a court construes as true the material alle gations in the complaint , along with all reasonable infere nces to b e drawn ther e f rom, and finds, beyond doubt, that the plaintiff can prove no set of f acts that would entitle the plaintiff to relief. Re ister

v. Gardner , 164 Ohio St.3d 546, 2020
- Ohio

- 548 4, 174 N.E.3d 713 , ¶ 17, citing State ex rel. Midwest Pride IV, Inc. v. Pontious , 75 Oh io St.3d 565, 570, 664 N .E.2d 931 (199 6). A Civ.R. 12(C) motion permits the court to consider the complaint and the a nswer in deciding whether the movant is entitled to judgment as a mat ter of law

. State ex re l. Fire Rock, Ltd. v. Ohio Dept. of C om merce , 163 Ohio St.3d 277, 2021

- Ohio

- 673, 169 N.E.3d 665 , ¶ 6 , citing Ponti ous at 569

. We review a trial court ’ s rulin g on a Civ. R. 12(C) motion f

or judgment on the pleadings de novo. Re ister at ¶ 17. 

### {¶41} Vandercar alleged in its complai nt th at t he Port was liabl e for Vandercar ’ s attorney fees because the Port acted in bad faith by refusing to pay the Redevelopment Fee and by str ucturing the February revenue bonds to make i t appear that they were not issued for re development t o a void havi ng to pay the fee

. V anderc ar pled this as a separate cause of action in its complaint. 

### {¶42} We address the bad

- faith attorney

- fee issue both as a separate c ause of action and as a request to include an aw ard of attorney fees as costs. As to the former,

w e aff irm the t rial court ’ s deter mination that no separate claim exists. But as to the la t ter, we return the case to the trial court.
i. Bad Faith as a Separate Claim 

### {¶43} Ohio recog nizes that i mplied in every contract is a duty of good faith and fai r deal ing

. Luc arell v. Nation wide M ut . In s. Co. , 152 Ohio St.3d 453, 2018

- Ohio

- 15, 97 N.E.3d 458, ¶ 42

. Howe ver, Ohio law is clear that it does not give rise to a stand

-OHIO FIRST DISTRICT C OURT OF APPEA LS

18 alone claim. “[T ]he duty of good faith an d fair dealing does not stand alone from the contract but is a part of it. ” Gr eat Wa ter Capital Partn ers, LLC v. Down

- Lite
Int ernat l., Inc

. , 1st Di st. Hamilton No s . C

- 150015 and C

- 150023 , 2015
- Ohio

- 4877 , ¶
14. Therefore , a breach

- of

- contract claim subsumes a n accompanying claim for the breach of the duty of good fai th a nd fair deal ing. Sherto k v. Wallace Gr ou p Gen.
Dent istry for Today, Inc. , 1st Dist. Hamilton Nos. C

- 190457 and C

- 1904 64, 2020

- Ohio

- 4369, ¶ 40. As a result, t here i s no indepen dent cause of action for a breach of the duty of good fai th separate from the u nderlying breach

- o f

- co ntract claim. Id.
ii. Bad Faith as B

asis for

Award of Attorney Fees as Costs 

### {¶44} B ut Vandercar does not simply claim that it is entitle d to attorney fees under the doctrine of go od faith and fair dealing. Ra ther, it relies on our decis ion in SST Bearing Cor

p. v. Twin City Fan Cos. , 1st Dist. Hamilton No. C

- 110611, 2012

- Ohio

2490, which pe rmit s the re cover y of attorney fees in a breach

- of

- contract case where

a plaintiff can establish bad faith by the breaching party

. 

### {¶45} Ohio courts generall y follow the “ Amer ican rule ” with respect to attorney fees : “ a prevailing party in a civil action may not recover att orney fees as part of the costs of litigation. ” Wilborn v. Bank One Corp. , 121 Ohio St.3d 546, 2009

- Ohio

306, 906 N.E.2d 396, ¶ 7, ci ti ng Nottingdale Ho me ow ners ’ Assn., Inc. v. Darby , 33 Ohio St.3d 32, 33
- 34, 514 N.E.2d 702 (1987) , and State ex rel. Beeb e v. Cowley , 116 Ohio St. 377, 382, 156 N.E. 214 (1927)

. But there are three well

- recognized exception s to this rule: (1) where a statut e s pecifically provid es th at a prevailing party may recover attorney fees ; (2) where the parties ’ contract pro vides for fee shiftin g ; and (3) where there has been a finding of bad faith

. SST Bearing at ¶ 28, citing Keal v. Day , 164 Ohio App.3d 21, 2005
- Ohio

- 5551, 840 N.E.2d 1 139, ¶ 5 (1s t Dist.)

. 

### {¶46} “ A party seeking attorney fees based on the bad

- faith exception to the American rule ‘ m ust be the prevailing party in the litigation, and then must prov e that his opponent acted in bad faith

. ’ ” Co venant Dove Hold ing Co., LLC v. Ma riner HealthOHIO FIRST DISTRICT C OURT OF APPEA LS

19 Care, Inc. , 1st Dist. Hamilton No. C

- 120878 , 2013
- Ohio

- 3824 , ¶ 7, quoti ng Strum v.
Strum , 63 Ohio St.3d 671, 675, 590 N.E.2d 1214 ( 1991). “ Bad faith ” generally im plies

“ a dishonest purpose, moral obliquity , conscious wrongdo ing, breach of a k nown duty due to ulterior motive , ill will comparable to fraud, or an actual intent to mislead or deceive anot her

. ” Id. a t ¶ 7
. Althoug h an award of attorney fees may be gra nted in a
contract action upon a finding by the tri al court of bad

- faith conduct, a tr ial court err s by awarding attorney fees where it has made no f inding of bad faith. Id. at ¶ 8; Wright

v . Fleming , 1 st Dist. Hamilton No. C

- 070121 , 2008

- Ohio

- 1435, ¶ 5. W e emphas ize that an award of attor ney fees is generally not a vailable in contra ct ac tions and will be warranted only in an e xceptional case. 

### {¶47} In SST Bearing , we held that the trial court was within its d iscretion to award attorn ey fees in a breach

- of

- contract action when it made an explicit finding that the breachin g party acted in b a d fa ith. In that ca se , the trial court found that the buyer had used the seller ’ s price to obtain leverage with other competi t ors, had tried
to obt ain trade

- secret information from the seller , had canceled the entire cont ract wit h the s eller prior to t es t ing any of the seller ’ s products and had canceled order s for products for w

hich the buyer could find no fault, and refused to give the seller an
opp ortunity to cure any potential d efects. SST Bearing , 1st Dist. Hamilton No. C

110611, 20 12
- Ohio

- 2490, at ¶ 29. 

### {¶48} Thereafter, we granted the buy er ’ s motion t o certify a conflict between our decision and the decisions of t wo other appellate districts on the f ollowing question: The “ American Rule ” does not pe rmit the prevailing party to recover
at torneys [] fees in the a bsence of a stat utory authori zation. Does Ohio recognize an excep tion to the Amer ican Rule for “ bad faith ” breach of
contract in absence of an award of punitive damages?OHIO FIRST DISTRICT C OURT OF APPEA LS

20 The buyer appealed to the Su preme Court of Ohio , which decline d juris diction

. S ST Be aring Corp. v. Twin City Fan Cos., L td. , 13 3 Ohio St.3d 1413, 2012

- Ohio

- 4650, 975 N.E.2d 1031. On review of the order certifyi ng a conflict, t he Suprem e Court

“ determined that no c onflict exist s, ” and dismissed the matter. SST B e ari ng Corp. v. Twin C ity F an Co s., Ltd. , 133 Ohio St.3d 1408, 2012

- Oh io

- 4650, 975 N .E.2d 1027. The Supreme Court denied a subsequent motion for reconsi deration. SST Bea ring Corp. v. Twin City Fan Cos., Ltd. , 133 Ohio St.3d 1494, 2012

- Ohio

- 5459, 978 N.E.2d 9 12
. 

### {¶49} In examining O hio l aw in a contract action where the plaint iff s ’ complaints included counts seeking attorney fees based on the defendant ’ s bad

- fa ith conduct , the U nited States District Court for the Southern District of Ohio explained the difference be tween a sta nd

- alon e cla im and a recovery of attorney fees for ba d

faith conduct . In Av is Rent a Car Sys., LLC v. City of Dayton , S.D.Ohio No s. 3:12
- cv 399 and 3:12

- cv - 405, 2013 U.S. Dist. LEXIS 119597 , * 7
- 8 (Aug. 2 2, 2013) ( “ Avis I ” ) , the court s tated : [I ] n breach of contr act ca ses, Ohio courts that award attorneys ’ fees after a showing of bad faith conduct do so as an award of costs to the prevailing party, not as an e lemen t of damages. [ (citing SST Bear ing and Col umbus Me d. Equip. Co. v. Watters , 13 Ohio App.3d 149, 468
N .E.2d 343 (10th Dist. 198 3) ] * * * Even though the P laintiffs have pled a separate cou nt for attorneys ’ fees based on allegations of ba d faith conduct, such a claim i s not co gn izable under Ohio law as a fre e standing cause of action, as “ g ood faith i s part of a c ontract claim and does not stand alone. ” Lak ota Local Sch. Dist. v. Brickner , 108 Ohio App.3d 637, 671 N.E.2d 578, 5 84 (Ohio Ct

. App. 1996). T hus, the issue of whether to award attorneys ’ fees to Plainti ffs is entirely a ppropr iate to award post

-

jud gment, or even post

- appeal, after a complete and fi nal resolution of the merits of their case.OHIO FIRST DISTRICT C OURT OF APPEA LS

21 

### {¶50} The court noted that before it entered summary judgment in favor of the plaintiffs on their motions for summary j udgment on their contract clai ms, the plaintiffs had a mended their complaints to include c ounts see king attorney fees, based on alleged “ bad faith ” conduct by the defendant. Id. at * 3
- 4. Because Oh io does not recognize a stand

- a lone cause of action for bad faith in a contract claim, t he court dismis se d the b ad

- faith counts in the plaintiffs ’ complaints and ordered the plaintiffs
to file post

judgment motions for a ttorney fees to pres erve their right s to request attorney fees , should th e court ’ s summary - judgment ruling s be affirmed

. Id

. at * 10
-
11. 

### {¶51} Then the plai ntiffs filed their motions for attorney fees , t he defendant appealed the court ’ s decision, and the Sixth Circu it Co urt of Appea ls affirmed the d ecision. See Avis Re nt A Car Sys., LLC v. City of Dayton , S. D .Ohio No. 3:12

- cv - 399,

2 015 U.S. Dist. LEX IS 12951 6 , * 16 (Sept. 25, 2015) ( “ Avis II ” )

. Thereaf

ter, the district
court addressed the plaintiff s ’ motions for attorney fees , applyi ng Ohio law. Id. at * 17. 

### {¶52} The defendant argued that the court should deny the motions for attorney f

ees because the Su preme Cour t of Ohio had never held that attorney fees are

recov erable for a bad

- faith breach of contract

. Id. at * 22. However, the distr ict court

“ believ e[d] that the Ohio Su preme Court would recognize the exception to the
Amer ican Rule for attorney s ’ fe es based on bad

- f aith conduct giv ing rise to a breac h

o f

- contract claim ” for several reasons. Id. 

### {¶53} First, the dis trict court pointed to o ur decision in S S T Bearing and other Ohio decisions affirm ing such awards in contract cases where no tort or punitive damages pro v ided the basis for attorney fees. See id. at * 25
- 32, citing SST Bearing , 1st Dist. Hamilton No. C

- 1 10611, 2012

- Ohio

- 2490 ; Dodson v. Maines , 6th Dist. Sandusky No. S

- 11
- 012, 20 12
- Ohio

- 254 8 (upholding award of attorney fees for bad

faith conduct i n an unjus t

- en richment action soun ding in contract) ; Hall v. Frantz , 9th Dist. Summit No. 19630 , 2000 Ohio App. LEXIS 2186 (May 24, 2000) (uphold ingOHIO FIRST DISTRICT C OURT OF APPEA LS

22 attor ney - fee award for ba d

- faith conduct in a n action to enforce a set tl e ment

a greement ); and L

EH Proper t ies , I

nc. v. Pheasant Run Assn ., 9th Dist. Lora in No. 10CA009780 , 2011
- Ohio

- 516 (aff irming attorney

- fee award for a pa rty ’ s bad

- faith noncompl iance with a s ettlement agreement). 

### {¶54} Second, the district court viewed as persu a sive the Supreme Court of Ohio ’ s de termination that our decision in SST Bearing was not in conflict with decisions of other appellate districts

. Avis II at * 3 2
- 34. The court stated that the ruling

“ provide[d] an addition reason to believe that [the Supreme Court of Oh io ] m ight recognize t he ex ception to the Amer ican Rule affirmed in that cas e. ” Id. at * 34. 

### {¶55} Finally , the district court pointed to the Supreme Court of Ohio ’ s decision in Sta te ex rel. Chap nick v. East Cleveland City School Dist. , 93 Ohio St.3d
449, 755 N.E.2 d 883 (2001), whic h could “ be re ad to implicitly assume that the plaintiff might have been entitled to attorney s ’ fees based on bad faith ” where “ the conduct in q uestion occurr ed e ntirely befo re he fil ed suit. ” Avis II at * 34
- 35. 

### {¶56} In following our prior de cision in SST Bear ing , we also ag ree with the d istrict court ’ s ana lysis in Avis II . We hold that in an exceptional case, a party may recover attorney fees if it can e stablish b ad faith on the part of the breaching party. And the bad faith need not involv e only condu ct occ urring during l itigation. Se e id. It can involve con duct giving rise to a pa rty ’ s claim. S ee S ST B e aring , 1st Dist. Hamilton
No. C

- 110611, 2012

- O hio

- 2490 , a t ¶ 29; Cleveland Fire Fighters, Local 93 of the I.A.F.F. v. City of Cleveland , 8th Dist. Cuyahog a No

. 109136 , 2 020
- Ohio

- 4751, ¶ 37 ( finding no abuse of discretion in trial court ’ s denial o f attorn ey fees upon its finding that defe ndant did not act in bad faith). “ If a trial court makes a finding that the losing party had acted in b ad faith, an d if t hat fi nding is supported by the record, an award of attorney fees is warranted. ” Coven ant Dove , 1st Dist. Hamilton No. C

- 120878 , 2013
- Ohio

- 3824 , at ¶ 7
. Again, we note that this will generally not be available in a breach

- of

- contract ac tion

.OHIO FIRST DISTRICT C OURT OF APPEA LS

23 

### {¶57} In thi s cas e, the trial cour t determined on the face of the compla int that

“ the re is no indi cation of bad faith in the present action. ” However, taking the allegations of the complaint as true , we cannot conclude that there is no set of facts under wh ich Van der car c ould recover. We thus sustain Vandercar ’ s first assignment of error , reverse the trial court ’ s decision in this re gard , and return this matter to the court for a determinat ion of whether the P ort acted in bad faith.

B. Pre

jud gment Intere

st 

### {¶58} In its second assi gnment of error, Vand ercar argues that the trial court erred by denying its motion for prejudgment inter est. It as serts that prejudgment interest is mandat ed by R.C. 1343.0 3(A), and that the t rial court erred by f inding that prejudgment int erest coul d not be imposed upon the Por t because it wa s an arm o r instrumentality of the state

. 

### {¶59} Generally, a party gran ted judgment on an underlying contract claim is entit led to prejudgment interest as a mat ter of law, pursuant to R.C. 1343.03(A)

. Ron ald J. Solomo n, D. D.S., Inc. v. Dav isson , 2018

- Ohi o - 2011, 113 N.E.3 d 1003, ¶ 7 (1s t Dist.)

. R.C. 1343.03(A) provides:
In cases other than those provided for in sections 1343.01 and 1343.02 of the Rev i sed Code, when mon ey becomes due a nd payable upon any b ond , bill, no te, o r other instrumen t of writing, upon an y book acco unt,
upon an y settlement between parties, upon all verb al contracts entered in to, and upon all judgments, decrees, and orders of any judicial
tr ibunal for the payment of money arisin g out o f t ortious co nduct or a
contract or other transaction, the cre ditor is entitled to interest at the rate per annum determin ed pursuant to section 5703.47 of the Revised Code, unless a written contract provides a different r ate of interest in relation to the mo ney that b e come s due and payable , in which case the credito r is entitled to interest at the rate provided in that contr act.OHIO FIRST DISTRICT C OURT OF APPEA LS

24 

### {¶60} Nev ertheless, R.C. 1343.03(A) does not require the paymen t of prejudgment interest b y a n arm or instrumentality of the state in a co ntrac t act ion

. See Beifuss v. W

esterville B d

. of Edn. , 37 Ohio S t.3d 187, 190, 525 N.E.2d 20 (1988) ( in the absence of statutory authority , a public school board cannot b e h e l d l i a b l e f o r
pr ejud gment interest on damages assessed in a contract action)

. As the Supre me Co urt of Ohio expl a ined in Beifuss , “ [ i ] t is well

- es ta blished that ‘ [i]n the absence of a
statu te requiring it, or a promise to pay it, interest cannot be adjudged against the state for delay in t he payment of money. ’ ” 4 Id. at 188

- 189, qu otin g State e x rel . Par rott v. Bd. of Pub

. Works , 3 6 Ohio St. 409 (1 8 8 1), paragraph four of the syllabus. T he court held th at th is “ interest rule ” applied “ to pu blic school boards as it ha s been applied to the s tate and its agencies. ” Id. at 189. 

### {¶61} The Be ifus s court s tated that it refused “ to abandon our long

- sta nding rule in co ntract actions that, in the absence of a statute requiring it, or a pro mise to pay it, interest cannot be assessed a gainst the st ate for delay in the payment of money. ” (Emphasis s ic

. ) I

d. at 190
. The court noted that in its prior cases, “we re fus ed to abandon the interest rule despit e the fact that p rejudgment interest was allo wable in cases filed against the state in the Court of Claim s under R.C. 2743.18. ” Id. at 190, citing S tate ex rel. Home Car e Pharmacy, I n c. v. Creas y , 67 Ohio St.2d 342, 4 23 N.E.2d 482 (1981) , and State ex rel. Montrie Nursing Home v. Creasy , 5 Ohio St.3d

12 4, 449 N.E.2d 763 (1983)

. In construing R.C. 1343.03(A), the court determined that the sta tutory pr ovisi on did n ot “ c lear ly express an y intention of the legis lature to

a ssess prejud gment interest against a public school boar d in this type of action. ” Id. at fn. 1
. ; State ex rel. Stacy v. Batavia Local Sch ool Dis t. Bd. of Edn ., 10 5 Ohio St .3d 476, 2005

- Ohio

- 29 74, 82 9 N.E .2d 298, ¶ 62. T he court found that any expansion of a

4 We note that a ru le that the state is not liable for pr ejudgment in terest in a case where it has delayed payment (i.e., slow pay) makes sense due to the bureaucracy and paperwork that may be involved w

hen the state ma kes payment. The cases, however, go well beyond simply delayed payments and incl uded, as did Be ifuss , c as es whe re the state dis c laims liability alt o g ether.OHIO FIRST DISTRICT C OURT OF APPEA LS

25 publ ic school board ’ s contractual liability to allow prejudgment interest “ should be created th rough clearly expressed legislation by the Gen er al Ass embly or by the parties themselve s at th e barg ainin g table. ” Id. at 190. 

### {¶62} The court held that a public sc hool board is an arm of the state because its d uties an d powers are defined exten sively in R.C. Title 33 an d it is “ ultim ately

m anaged and controlled by the dictates of the Gen eral Ass em bly. ” Id. at 18 9 , quoting Tha xto n v. Medina City Bd. o f Edn. , 21 Ohio St.3d 56, 57, 488 N.E.2d 1 36 (19 8 6). T he court held that a public school board was not liabl e for the payment of prejudgmen t i nterest on an award of back pay because there wa s no sta tute or contr actua l provision requi ri ng it

. Id. at 190. 

### {¶63} T he Supreme Court has also dec lined to award prejudgmen t interest on

a n employee ’ s award of back pay against a county sheriff ’ s department

. S e e S tate ex rel. Carver v. Hull , 70 Ohio St.3d 57 0, 579, 639 N.E.2d 11 75 (1 994 )

. In Carver , the Supr eme Court rej ected the employee ’s argument that she was entitled to prejudgment interest on an award of back pay under R.C. 13 43.03(A) , because the provisio n “d [id] not specifically establish that a count y can be held liabl e for i nterest on a judg ment at all, much less for prejudgment interest. ” Id. at fn. 3

. 

### {¶64} In White v. Summit C ty. Dept. of H uman Serv s . , 9th Dist. Summit Nos.
23740 and 23741 , 2008

- Ohio

- 176, the Ninth District followed the approach taken by the Beifuss cour t and determined that a county department of j ob and family services , like a public school board , is an arm of the s tate because it is “ ultimately managed and controlled by the dictates of the General Ass embly. ” White at ¶ 14, quoting B eifuss , 37 Ohio S t. 3d at 189 , 525 N.E.2d 20
. The court noted t ha t the county department was created under R.C. Chapter 329, which extensively detailed the department ’ s duties and powers. Id. at ¶ 13. The c ourt held that prejudgment interest may not a c cr ue
aga inst the depa rtmen t in the absence of a statute authorizi ng it

. Id. at ¶ 14.OHIO FIRST DISTRICT C OURT OF APPEA LS

26 

### {¶65} And in State ex rel. Mendez v. Pub

. School Emp

. Retirement Sys

. , 10th Dist. Franklin No. 88A P

- 458, 19 89 Ohio App. LEXIS 19 34 , * 10
- 11 (May 23, 1989) , the Tenth District hel d tha t a school emp loy e es retirement boar d , which w as a creatur e of statute and could act only in accordance with its en abling statutory scheme , was a n instrument al ity of the state

. The court held that n o ge neral statute, including R.C.
1343.03, provide d for i nterest to be o rde red against the st ate in actions other t ha n those brought in the Court of Claims , and therefore, prejudgment interest could not be assessed against the retiremen t board. Id. at * 12
- 13
. 

### {¶66} As relevant here, a port authority is a political su bdivision of th e s tate of Ohio create d under R.C

. Chapter 4582. State ex rel. Tol e d o Blade Co. v. Tol e d o - Lucas
C ty

. Port Auth

. , 121 Ohio St.3d 537, 2009

- Ohio

- 1767, 9 05 N.E.2d 1221, ¶ 11. R. C. 4582.21(A) defines a “ port auth ority ” as “ a b ody corporate and politic create d p ursuant to the auth ority of se ctio n 4582 .22 of the Rev ised Code. ” R.C. 4582. 2 2 , in t urn,
pro vides that port authorities ex ercise essential governmental functions of the sta te. That statute provides in relevant part : A p ort auth ority cre ated pursu ant t o t his section is a bo dy corpor at e and politic wh ich may sue and be sued, plead and be i mpleaded, and has the powers and jurisdiction enum erated in sections 4582. 2 1 to 4 582. 59 of the Revised Code. The ex ercise by such port a uthority of the powers conf erre d u pon it shall be con sidered t o be essential gover nmental functions of this state, but no port authority is immune from liability by reason thereof

. R.C. 4582.22(A). A po rt a uthority ’s powers are detailed in R.C. 4582. 31 (A ) (1)

- (27). 

### {¶67} Like t he publ i c schoo l b oar d i n Beifuss , th e county de partment of human services in White , and the retirement board in Mend ez , a port authority is an

a rm of the state because it is a cre ature of st atute and its powers are extensive ly detailed by statute. The ref ore, a port aut hor ity cannot be h eld liable fo r prejudgmentOHIO FIRST DISTRICT C OURT OF APPEA LS

27 interest on damages assessed in a contr act action in the absence of a stat utory or contractual provision requiring it. See Beifuss , 37 Ohio S t.3d at 188

- 189 , 525 N.E.2d

20
. And R.C. 1343.03(A), relied on by Va n de rcar, do es not prov ide stat u to ry au thority
to assess prejudgment interest against the s tate or an a rm of the s tate in a contract action

. See Beifuss at 190 ; Mendez at * 12
- 13
. 

### {¶68} Vandercar seizes on the last clause of the l ast sentence of the statutory
pr ov is ion in R.C. 4582.2 2(A)

— “ n o po rt authority is immun e from liability by reason of ” its performance of “ essent ial governmental functions ”

— and arg ues that “ when the General Ass embly created th is new form of public entity, it gave port autho rities
gove rn men ta

l powers but denied them any fo rm of sovereign immunit y. ” (Emphasis deleted.) Contra ry to Vandercar ’ s assertion, however, the Port never claimed that it

was entitled to tot al sover eign im munity from Vandercar ’ s contract claim. I nstead, the Por t r elied o n the well

- establish ed interest rule, reiterated in Be ifuss , that the state is not lia ble for prejudgment interest in the absence of a statute requiring it or a promise to pa y it. 

### {¶69} Moreover, unlike R.C. 2743.18(A) , which p rovides a statut ory right to
pre ju dgment interest in s uits against the sta te brought in the Court of Claims ( “ [p] rejudgment inter e st shall be allowed wit h respect to any civil action on which a j udgment or de termination is rendered against the state ” ) , R.C . 4582.22(A) mak es no mention of p rejudgmen t interest. A s the Supreme Court held long ago , “ The state is not bound by the terms of a general statute, unless i t be so expr essly enacte d. ” State ex rel. Parrot t v. Bd. of Pub . Works , 36 Ohio St. 409 ( 1881) , paragraph three of the syllabus. 

### {¶70} R ather, like the Supr eme Court ’ s description of R.C. 1343. 03 (A), the cited cla use from R.C. 4582.22(A) does “ not clearly express any intention of the legi s l ature to assess pre judg ment interest ” against an arm of the state

. S ee Beifuss , 37 Ohio St.3d at 1 91 , fn. 1, 525 N.E.2d 20

. Therefore, we d ecline to re ad into the phraseOHIO FIRST DISTRICT C OURT OF APPEA LS

28 “ n o port authority is immun e from liability by reason [of its governmental functions] ”
a stat utory requirement to assess prejudg ment inte rest against a port authority. See
In re I c ebre aker Windpower, I nc. , Slip Opinion No. 2022
- Ohio

- 2742, ¶ 56 ( “ We may not add words to a statute to achieve a desired construction. ” ). If the legis lature intended to ass ess pre

judgme nt interest against a p ort authority in a contract acti o n , it could h ave d one so. 

### {¶71} In the ab senc e of statutory authority allowing prejudgment interest to be assess ed against the Port in this action, or an agreement by the parties to pay it, we hold that pre

judgment interest c anno t be asse ssed against it on the c ontract awa rd beca use it is an arm of the state. Therefore, we hold that t he trial cour t properly denied Vandercar ’ s motion for prejudgment interest. We overrule Vandercar ’ s second assignment of err or . Conclusion 

### {¶72} In summ ary , we h old that the trial cour t properly g ra nted s ummary j udgment i n favor of Vandercar, and denied summary judgment in favor of the Port, on Vandercar ’ s breach

- of

- contract claim. We hold that the trial court properly dismissed Va ndercar ’ s bad

- faith cla im as a stand

- alone claim and deni ed its mot io n for pre judgment inte r est. We hold, howe ver, that the trial court erred in granting judgment on the pl eadings as to Vande rcar ’ s claimed entitleme nt to attorney fees a s a

r esult of claimed ba d faith on the part of the Port. Therefore, we affi rm the tri al court ’ s entry of summ a ry judgment in favor of Vander car on its breac h

- of

- contract claim and its entry d e nying prejudgment interest. We reverse the trial court ’ s judgment on the pleadings on Vanderc ar ’ s ba d

- faith claim and r emand the matter to the trial c ourt f or a determinati o n of whether the Port acted in bad faith , and , if so, whether an award of attorney fees in favor of Vandercar is warranted.
J udg ment a ccordingly

.OHIO FIRST DISTRICT C OURT OF APPEA LS

29 B ERGERON and B OCK , J J ., concur. P lease note:
T he cour t has recorde d it s own entr y this d a te.