Court Opinion

ID: 4690733
Source: CourtListenerOpinion
Date Created: 2021-05-27 18:13:12.131334+00
Date Added: 2024-06-11T08:05:02.175574
License: Public Domain

[Cite as Figgie v. Figgie, 2021-Ohio-1812.]

                               COURT OF APPEALS OF OHIO

                              EIGHTH APPELLATE DISTRICT
                                 COUNTY OF CUYAHOGA

SUSAN A. FIGGIE, ET AL.,                           :

                 Plaintiffs-Appellants,            :
                                                                No. 109834
                 v.                                 :

BETSY FIGGIE, ET AL.,                              :

                 Defendants-Appellees.              :

                                JOURNAL ENTRY AND OPINION

                 JUDGMENT: AFFIRMED
                 RELEASED AND JOURNALIZED: May 27, 2021

             Civil Appeal from the Cuyahoga County Court of Common Pleas
                                     Probate Division
                                Case No. 2019ADV242885

                                              Appearances:

                 Benesch, Friedlander, Coplan & Aronoff L.L.P., Yelena
                 Boxer and Kristen-Elise F. DePizzo, for appellant Susan
                 A. Figgie, through her conservator Harry E. Figgie IV.

                 Baker & Hostetler L.L.P., Michael K. Farrell, Robert R.
                 Galloway, and Corey N. Barnes, for appellee Betsy Figgie,
                 Trustee.

                 Calfee Halter & Griswold, L.L.P., and Mitchell G. Blair,
                 Colleen M. O’Neil, Kelly A. Callam, and Alexandra
                 Forkosh; Ulmer & Berne, L.L.P., Steven S. Kaufman,
                 Robin M. Wilson, and Ashtyn N. Saltz, for appellee Brent
                 Ballard, in his capacity as Co-Trustee for the Harry E.
                 Figgie, Jr. Trust, Trustee for the Nancy F. Figgie Trust, and
                 Trustee for the Matthew P. Figgie Trust.
EMANUELLA D. GROVES, J.:

              Plaintiff-appellant, Susan A. Figgie (“Susan”), through her conservator,

Harry E. Figgie, IV (“Harry IV”), 1 appeals the probate court’s decision granting the

Civ.R. 12(B)(6) motion to dismiss filed by defendant-appellee Brent Ballard

(“Ballard”), as co-Trustee of the Harry E. Figgie II Trust Agreement dated

July 15, 1976, as amended; Trustee of the Nancy F. Figgie Trust Agreement dated

September 7, 1976, as amended; and Trustee of the Matthew P. Figgie Trust

Agreement dated October 20, 1985, as amended (collectively, the “Trust

Defendants”). Appellant contends that she sufficiently pled claims for fraud, tortious

interference with expectancy of inheritance, unjust enrichment, conversion, and

constructive trust arising out of a 2001 stock redemption against the Trust

Defendants and that the probate court, therefore, erred in granting the Trust

Defendants’ motion to dismiss.    For the reasons that follow, we affirm the probate

court’s decision.

                    Procedural History and Factual Background

              In the companion appeal of the underlying case, Figgie v. Figgie, 8th

Dist. Cuyahoga No. 109829, 2021-Ohio-1195, we accurately and comprehensively set

forth the factual background and procedural history. For consistency, we adopt that

summary and recount as follows:

       Nancy Figgie (“Nancy”) and Harry E. Figgie, Jr. (“Harry II”) had three
       children — Harry E. Figgie, III (“Harry III”), Mark P. Figgie (“Mark”),

       1Susan is developmentally disabled and her brother, Harry IV, serves as her
conservator. For purposes of this appeal, we will use “Appellant” where we would
normally refer to Susan.
     and Matthew P. Figgie (“Matthew”). On August 23, 1983, Harry III
     executed a trust agreement that established the Figgie Family Trust
     (the “Harry III Trust”), of which his three children, Harry IV, Katie, and
     [Susan], were beneficiaries.2

     Harry III died on December 21, 1999. Among the assets of the Harry
     III Trust at the time of Harry III’s death were classes of voting and
     nonvoting shares of Clark Reliance Corporation (“CRC”), a closely held
     corporation built by the Figgie family. Harry II had conveyed the CRC
     stock to the Harry III Trust while Harry III was alive.

     Prior to his death, Harry III had a “bitter falling out” with his parents
     (Harry II and Nancy) and brother Matthew. This estrangement
     continued until Harry III died. Pursuant to the terms of the trust
     agreement, after Harry III died, Harry II served as the trust advisor for
     the Harry III Trust, charged with decisions relating to the investment,
     sale, and purchase of stock for the trust. Wilmington Trust Co. was the
     trustee of the Harry III Trust.

     Following Harry III’s death, the Harry III Trust owned 4,000 shares of
     Class A CRC stock and 76,000 shares of Class B CRC stock (collectively,
     the “CRC stock”). On October 21, 2001, CRC redeemed the CRC stock
     from the Harry III Trust for a purchase price of $1,909,007 “through a
     transaction that was initiated and directed by [Harry II]” (the “2001
     CRC stock redemption”). At the time of the 2001 CRC stock
     redemption, Harry II, Nancy, Mark, and Matthew were all
     shareholders of CRC. Harry II was also an officer of CRC or a member
     of its board of directors. At the time of the 2001 CRC stock redemption,
     Harry IV was 18, Katie was a minor, and Susan was “cognitively and/or
     medically disabled.”

     Harry II died on July 14, 2009. Prior to their deaths, Harry II, Nancy,
     and Matthew each executed trust agreements establishing separate
     trusts — the Harry E. Figgie II Trust Agreement dated July 15, 1976, as
     amended (the “Harry II Trust”), the Nancy Figgie Trust Agreement
     dated September 7, 1976, as amended (the “Nancy Trust”), and the
     Matthew P. Figgie Trust Agreement dated October 20, 1985, as
     amended (the “Matthew Trust”).

     2 The trust agreement for the Harry III Trust was not attached to the first amended

complaint. Accordingly, we assume, but cannot confirm, that the first amended
complaint accurately sets forth the terms of the trust agreement.
On December 20, 2018, Katie and Harry IV, individually and as
conservator of [Susan], filed suit in the Cuyahoga County Court of
Common Pleas, Probate Division, against (1) defendant-appellee Betsy
Figgie (“Betsy”), as co-trustee of the Harry E. Figgie II Trust Agreement
dated July 15, 1976, as amended, (2) Ballard, as co-Trustee of the Harry
E. Figgie II Trust Agreement dated July 15, 1976, as amended, Trustee
of the Nancy F. Figgie Trust Agreement dated September 7, 1976, as
amended, and Trustee of the Matthew P. Figgie Trust Agreement dated
October 20, 1985, as amended and (3) CRC related to the 2001 CRC
stock redemption (Case No. 2018ADV239801).

On April 20, 2019, appellants filed a first amended complaint in Case
No. 2018ADV239801, asserting claims for declaratory judgment,
fraud, tortious interference with expectancy of inheritance, unjust
enrichment, constructive trust, and civil conspiracy against CRC and
the Trust Defendants (collectively, “defendants”).

 In the first amended complaint, [Appellant] alleged that as trust
advisor of the Harry III trust, Harry II owed fiduciary duties, including
an “undivided duty of good faith and loyalty,” to the Harry III Trust and
to the beneficiaries of the trust, and that, at the time of the 2001 CRC
stock redemption, Harry II “was operating under several serious and
insurmountable conflicts of interest.” [Appellant] further alleged that
CRC and Harry II’s conduct in connection with the 2001 CRC stock
redemption was “misleading, in bad faith and/or fraudulent in nature”
and that the purchase price the Harry III Trust received for its CRC
stock during the 2001 CRC stock redemption was “well below market
value,” resulting in losses to the Harry III Trust and to appellants as
beneficiaries of the trust. Specifically, [Appellant] alleged that Harry II
and CRC (1) “did not properly, fairly or adequately secure or evaluate a
valuation of the CRC [s]tock,” (2) relied on a valuation of CRC prepared
by a non-independent person/company, (3) did not secure an
independent valuation of the CRC stock, (4) manipulated or relied on
known and unreasonably manipulated data to reduce the valuation of
the CRC stock, and (5) “maliciously combined” to secure the
redemption of CRC stock at a substantial savings to CRC in order to
benefit CRC and other Figgie family shareholders at the expense of the
Henry III Trust and its beneficiaries.

 [Appellant] claimed that as a result of the 2001 CRC stock redemption,
CRC and its remaining shareholders recognized “a significant increase”
in the value of their shares and that this appreciated value could be
traced to assets currently held by CRC, the Harry II Trust, the Nancy
Trust, and the Matthew Trust. [Appellant] alleged that [she] had been
       deprived of the CRC stock (or its fair value in assets) as part of their
       inheritance, that the defendants had been unjustly enriched by the
       “wrongful, fraudulent conduct” that led to the 2001 CRC stock
       redemption and that [Appellant] was, therefore, entitled to the
       imposition of a constructive trust over “the improper benefits, gains,
       appreciation, profits and unjust enrichment derived from the 2001
       redemption of the CRC [s]tock.”

        [Appellant] claimed that [she] did not discover, and had no way of
       discovering, “the false, flawed and concealed data and valuation
       process” that was used in the 2001 CRC stock redemption until
       November 25, 2018.3 [Appellant] requested an order declaring (1) that
       the 2001 redemption of the CRC stock was “below value,” (2) that
       “improper benefits and proceeds” from the 2001 CRC stock
       redemption exist in the Harry II Trust, the Nancy Trust, the Matthew
       Trust, and CRC, (3) the amount of the lost value, and (4) that
       defendants are “equitably estopped from denying liability” or denying
       the “claims stemming from the fraudulent conduct” alleged in the first
       amended complaint. [Appellant] also sought compensatory and
       punitive damages, attorney fees, costs, and expenses and an order
       imposing a constructive trust over the defendants’ assets “derived or
       traced from the improper benefits, gains, appreciation [or] profits”
       from the 2001 CRC stock redemption.

       On May 24, 2019, CRC and the Trust Defendants filed separate motions
       to dismiss the first amended complaint pursuant to Civ.R. 12(B)(6).
       The Trust Defendants argued that the first amended complaint failed
       to state a claim for which relief could be granted against the Trust
       Defendants because: (1) it contained no allegations of actionable
       conduct by the Trust Defendants; (2) any liability on the part of Harry
       II could not be imputed to the Trust Defendants; (3) appellants’ claims
       were barred by the applicable statute of limitations, including R.C.

       3 It is unclear from the first amended complaint how appellants allegedly
discovered these facts. The first amended complaint simply avers that certain,
unidentified “disclosures” were made “in late November 2018” regarding the 2001 CRC
stock redemption and that appellants “discovered” certain “information” on
November 25, 2018 “that led them to later find out” about the circumstances surrounding
the 2001 CRC stock redemption.
       [In Appellant’s first amended complaint, filed as conservator for Susan, it is alleged
that because of Susan’s disability, she was unable to understand or consent to the
transaction in 2001. Further, that due to Susan’s disability, she has, to this day, not
discovered, and had no way to discover the allegedly false, flawed, and concealed data and
valuation used when the CRC stock was redeemed by CRC from the Harry III Trust.]
2117.06, 2305.09(c), (d), and 2305.14; (4) appellants failed to plead
their fraud claim against the Trust Defendants with particularity as
required under Civ.R. 9(B); (5) appellants could not establish essential
elements of their unjust enrichment claim against the Trust
Defendants, and (6) the imposition of a constructive trust is a remedy,
not an independent cause of action.

[Appellant] filed an opposition and maintained that the allegations of
the first amended complaint — describing how the 2001 CRC stock
redemption was fraudulent, “detail[ing] the concealment of material
facts relating to the value of the stock transaction, ‘with the knowledge,
acquiescence and/or assistance of all Defendants (or their
predecessors)’” and asserting that the Trust Defendants “knew about
the fraud,” “participated in it” and “retained the benefit of
misrepresentations” that caused [Appellant] “substantial damages” —
were sufficient to state a claim for which relief could be granted under
Civ.R. 12(B)(6). [Appellant] denied that the statute of limitations set
forth in R.C. 2117.06 applied to [her] claims, argued that all applicable
statutes of limitations were tolled through application of the discovery
rule and asserted that constructive trust was a “stand-alone claim” or
was “properly joined” pursuant to Civ.R. 18.

 On June 18, 2020, the probate court granted the Trust Defendants’
motion to dismiss, dismissing all six counts against the Trust
Defendants. With respect to [Appellant’s] fraud claim, the probate
court held that although [Appellant] had sufficiently pled a fraud claim
against CRC — based on CRC’s alleged concealment of information
material to the 2001 CRC stock redemption — [Appellant] had not
sufficiently pled a fraud claim against the Trust Defendants. The
probate court explained:

The Court finds that the essence of Plaintiff’s fraud claim alleges that
[CRC] and [Harry II] had a duty to disclose information which was
concealed from the Plaintiff regarding the 2001 redemption of CRC
stock. Specifically, Plaintiff assert that CRC, [Harry II], and, upon
information and belief, all other Defendants (or their predecessors in
interest), knew the 2001 redemption of CRC stock was fraudulent,
deflated, and manipulated, and that such information was concealed
from Plaintiff. Upon review of the allegations in the First Amended
Complaint, Plaintiff has sufficiently alleged with particularity that CRC
had a duty to disclose, but instead concealed information, which was
material to the transaction of the redemption of CRC stock, and that
Plaintiffs justifiably relied upon the false and misleading information
provided by CRC which resulted in an alleged monetary injury to the
Plaintiff. This Court cannot find, however, that Plaintiff has sufficiently
plead the allegations of fraudulent conduct against [the Trust
Defendants], as Plaintiffs have not plead with particularity any alleged
fraudulent conduct by the Trust Defendants in the redemption of CRC
stock.

Plaintiff allege that the Trust Defendants, or their predecessors in
interest, knew of the allegedly fraudulent and/or manipulative
redemption of CRC stock in 2001. As such, Plaintiff assert that upon
their information and belief, the Defendants, or their predecessors in
interest, knew the 2001 redemption of CRC stock was fraudulent.
Plaintiffs have failed to identify any specific representations or
concealment of facts made by the Trust Defendants upon which
Plaintiffs relied. Plaintiff further request that this Court hold the Trust
Defendants liable for alleged fraudulent conduct and actions, not of the
named Trust Defendants, but of their predecessors in interest. The
allegations asserted against the Trust Defendants, or their predecessors
in interest, do not rise to the level of particularity as required by Civ.R.
9. Consequently, upon review of the First Amended Complaint, the
Court finds that Plaintiff has failed to plead the claim of fraud with
particularity as to the Trust Defendants[.]

With respect to [Appellant’s] claim for declaratory judgment, the
probate court held that [Appellant’s] request for an order declaring that
“improper benefits and proceeds” from the 2001 CRC stock
redemption are in the Harry II Trust, the Nancy Trust, and the Matthew
Trust and that defendants are “equitably estopped from denying
liability” or denying the “claims stemming from the fraudulent
conduct” asserted in the complaint were not “justiciable controversies
between adverse parties which fall under R.C. Chapter 2721” and,
therefore, dismissed that claim as to the Trust Defendants.

The probate court determined that [Appellant’s] claims of tortious
interference with expectancy of inheritance, unjust enrichment,
constructive trust, and civil conspiracy against the Trust Defendants
failed as well. The probate court held that [Appellant] could not
establish the expectancy-of-inheritance or causation elements for its
tortious interference claim because appellants’ expectancy of
inheritance “occurred in 1999 when they inherited the trust assets upon
Harry III’s death.” The probate court held that [Appellant’s] unjust
enrichment claim was barred by the statute of limitations and that any
alleged benefit conferred upon the Trust Defendants as a result of the
2001 CRC stock redemption was an indirect benefit that could not
support a claim for unjust enrichment against them. The probate court
       further held that constructive trust is “a form of equitable relief” in
       cases of fraud and unjust enrichment, not an independent claim, and
       that [Appellant] could not prevail on their civil conspiracy claim against
       the Trust Defendants because the Trust Defendants had not been
       named in the civil conspiracy count and the underlying fraud claim
       against the Trust Defendants had been dismissed. The probate court
       also determined that there was no just reason for delay pursuant to
       Civ.R. 54.

 Id. at ¶ 3-17.

              Appellant now appeals and assigns the following errors for our

review:

                           Assignment of Error No. 1
       The probate court improperly dismissed appellant’s constructive trust
       claim against the Trust Defendants.

                          Assignment of Error No. 2
       The probate court also incorrectly dismissed appellant’s claim for
       unjust enrichment against the Trust Defendants.

                           Assignment of Error No. 3
       The probate court incorrectly determined that appellant failed to state
       a claim of fraud against the Trust Defendants.

                           Assignment of Error No. 4
       The probate court incorrectly dismissed appellant’s claim for tortious
       interference with expectancy of inheritance.

                           Assignment of Error No. 5
       The probate court incorrectly dismissed appellant’s claim for conversion. 4

                                 Law and Analysis

                  The probate court dismissed the complaint pursuant to Civ.R.

12(B)(6). “A Civ.R. 12(B)(6) motion to dismiss for failure to state a claim on which

       4 Appellant does not challenge the probate court’s dismissal of the claims for
declaratory judgment or civil conspiracy. Accordingly, we do not further address those
claims here.
relief can be granted ‘“is procedural and tests the sufficiency of the complaint.”’

Harper v. Weltman, Weinberg & Reis Co., L.P.A., 8th Dist. Cuyahoga No. 107439,

2019-Ohio-3093, ¶ 11, quoting State ex rel. Hanson v. Guernsey Cty. Bd. of

Commrs., 65 Ohio St.3d 545, 548, 605 N.E.2d 378 (1992), citing Assn. for Defense of

Washington Local School Dist. v. Kiger, 42 Ohio St.3d 116, 117, 537 N.E.2d 1292

(1989).

             “A trial court’s review of a Civ.R. 12(B)(6) motion to dismiss is limited

to the four corners of the complaint along with any documents properly attached to,

or incorporated within, the complaint.” Lakeside Produce Distrib. v. Wirtz, 8th Dist.

Cuyahoga No. 109460, 2021-Ohio-505, ¶ 11, citing Glazer v. Chase Home Fin. L.L.C.,

8th Dist. Cuyahoga Nos. 99875 and 99736, 2013-Ohio-5589, ¶ 38. “Within those

confines, a court accepts as true all material allegations of the complaint and makes

all reasonable inferences in favor of the nonmoving party.” Srokowski v. Shay, 8th

Dist. Cuyahoga No. 100739, 2014-Ohio-3145, ¶ 10, citing Fahnbulleh v. Strahan, 73

Ohio St.3d 666, 667, 1995-Ohio 295, 653 N.E.2d 1186.

              “It is a long-standing principle that a plaintiff is not required to prove

his or her case within the complaint at the pleading stage.” Dean v. Cuyahoga Cty.

Fiscal Office, 8th Dist. Cuyahoga No. 107824, 2019-Ohio-5115, ¶ 16, citing York v.

Ohio State Hwy. Patrol, 60 Ohio St.3d 143, 144-145, 573 N.E.2d 1063 (1991).

“‘Consequently, as long as there is a set of facts, consistent with the plaintiff's

complaint, which would allow the plaintiff to recover, the court may not grant a

defendant's motion to dismiss.”’ Id., quoting York at 425.
               An appellate court reviews de novo of a trial court’s decision granting

a motion to dismiss under Civ.R. 12(B)(6). Naiman Family Partners, L.P. v. Saylor,

8th Dist. Cuyahoga No. 108607, 2020-Ohio-4987, ¶ 11, citing Perrysburg Twp. v.

Rossford, 103 Ohio St.3d 79, 2004-Ohio-4362, 814 N.E.2d 44, ¶ 5. “In applying the

de novo standard of review, this court independently reviews the record without

affording deference to the trial court’s judgment.” Penniman v. Univ. Hosps. Health

Sys., 8th Dist. Cuyahoga No. 107406, 2019-Ohio-1673, ¶ 7, citing Bandy v. Cuyahoga

Cty., 8th Dist. Cuyahoga No. 106635, 2018-Ohio-3679, ¶ 10, citing Herakovic v.

Catholic Diocese of Cleveland, 8th Dist. Cuyahoga No. 85467, 2005-Ohio-5985, ¶ 13.

               Preliminarily, as previously noted, this is a companion appeal based

on the same operative facts and circumstances as Figgie, 8th Dist. Cuyahoga No.

109829, 2021-Ohio-1195.5 In the instant matter, assignments of error Nos. 1, 2, 3,

and 4 are identical to the four assignments of error raised in the companion appeal.

Id. at ¶ 18.

               There, following a detailed analysis of the parties’ arguments and

appropriate case law, we found that the probate court did not err in dismissing the

complaint as to the Trust Defendants.        Having addressed the identical errors,

concerning the same operative facts and circumstances, we now, in accordance and

        5
        At footnote 2 in the brief to this court, Appellant stated: “Issues Presented for
Review 1-4 largely mirror those Issues raised by Appellants Harry E. Figgie, IV and
Catherine E. Figgie in their brief filed on September 14, 2020 in companion Appeal No.
109829.” Where appropriate, in the interest of judicial efficiency, the arguments
presented by these appellants are incorporated within.
in harmony with that decision, overrule assignments of error Nos. 1, 2, 3, and 4 of the

present appeal.

               We turn our attention to the fifth assignment of error, wherein

Appellant argues the probate court erred when it dismissed her claim for conversion.

               “Conversion is “‘the wrongful control or exercise of dominion over the

property belonging to another inconsistent with or in denial of the rights of the

owner.’” Poston ex rel. Poston v. Shelby-Love, 8th Dist. Cuyahoga No. 104969, 2017-

Ohio-6980, ¶ 18, quoting Beavers v. PNC Bank, N.A., 8th Dist. Cuyahoga No. 99773,

2013-Ohio-5318, ¶ 29 “‘“‘“The elements of a conversion are: (1) plaintiff’s ownership

or right to possession of the property at the time of conversion; (2) defendant’s

conversion by a wrongful act or disposition of plaintiff's property rights; and (3)

damages.”’”’” Poston at id., quoting Schiff v. Dickson, 8th Dist. Cuyahoga Nos. 96539

and 96541, 2011-Ohio-6079, ¶ 30, quoting Dream Makers, Inc. v. Marshek, 8th Dist.

Cuyahoga No. 81249, 2002-Ohio-7069, ¶ 19, quoting Haul Transport of Va., Inc. v.

Morgan, 2nd Dist. No. 14859, 1995 Ohio App. LEXIS 2240, 9, quoting 18 American

Jurisprudence 2d, Conversion, Section 2, at 146-147 (1985).

               Further,

       [i]f defendant came into possession of the property lawfully, the
       plaintiff must prove two additional elements to establish conversion:
       (1) that the plaintiff demanded the return of the property after the
       defendant exercised dominion or control over the property; and (2)
       that the defendant refused to deliver the property to the plaintiff.

 6750 BMS, L.L.C. v. Drentlau, 8th Dist. Cuyahoga No. 103409, 2016-Ohio-1385,

¶ 28, citing R&S Distrib., Inc. v. Hartge Smith Nonwovens, L.L.C., 1st Dist.
Hamilton No. C-090100, 2010-Ohio-3992, ¶ 23. “The measure of damages in a

conversion action is the value of the converted property at the time it was

converted.” BMS at id., citing Tabar v. Charlie’s Towing Serv., 97 Ohio App.3d 423,

427-428, 646 N.E.2d 1132 (8th Dist.1994).

              The probate court’s well-reasoned opinion stated in pertinent part as

follows:

       [T]he Court does not find that Plaintiff’s allegations meet the elements
       for a claim of conversion. On October 20, 2001, CRC redeemed from
       the Harry III Trust the CRC shares through a transaction that was
       allegedly directed by Harry Jr. as the Trust Advisor of the Harry III
       Trust. This was a transaction which involved the redemption of the
       shares for a purchase; it was not a wrongful exercise of dominion over
       property in exclusion of the rights of Plaintiff, and CRC was not
       withholding the shares from Plaintiff possession under a claim
       consist[ent] with its rights. Even if the Court were to find the shares
       were purchased for less than their worth due to the allegedly fraudulent
       conduct of CRC, the transfer of Plaintiff’s property rights of the CRC
       Shares during the redemption do not amount to conversion. As such,
       Count II of the First Amended Complaint should be dismissed in its
       entirety.

              As the probate court aptly noted, even if it were to find that the shares

were purchased for less than what they were worth, due to the allegedly fraudulent

conduct of CRC, the transfer of the plaintiff’s property rights of the CRC shares

during the redemption does not amount to conversion. Significantly, here, because

CRC paid the Harry III Trust for the shares it once held, the Harry III Trust was not

dispossessed of its property interest in the CRC shares. Because the Harry III Trust

received proceeds from the redemption of the shares, this was not a wrongful control

or exercise of dominion over property belonging to another.
               Appellant acknowledges as much, positing that “this was a transaction

which involved the redemption of the shares for a purchase price * * * rather than a

wrongful exercise of dominion over property in exclusion of the rights of plaintiff.”

The position is not well taken because it is undisputed that the Harry III Trust was

compensated at the time of the redemption, albeit in an amount not presently

pleasing. As such, the conversion claim cannot be maintained.

               Nonetheless, Appellant argues Ohio courts have recognized that a

claim for conversion may be maintained in cases involving the transfer of corporate

stock. In support, Appellant cites Crowe v. FirstEnergy Corp., 5th Dist. Holmes No.

10CA023, 2011-Ohio-5092. However, Crowe is distinguishable from the instant

matter and does not support the position Appellant advances.

               In Crowe, husband and wife were divorced on July 28, 2008. Per the

terms of the parties’ separation agreement, husband agreed to transfer 50 percent of

his shares of common stock in FirstEnergy Corp. to wife. At the time of the divorce,

husband owned 844.137 shares of common stock in FirstEnergy Corp. Husband

subsequently delivered to FirstEnergy’s Shareholder Services Department a stock

power, dated August 28, 2008, requesting a transfer of one-half of his FirstEnergy

shares of common stock to his wife. Because a dividend reinvestment was due to be

made on or about September 1, 2008, FirstEnergy waited until September 13, 2008,

to transfer the shares of the stock, after the reinvested shares were purchased and

posted to all accounts.
               However, FirstEnergy mistakenly permitted the transfer of all of the

husband’s shares of stock to the wife (850.558 shares at that time). At the time of

transfer, the transfer price of the stock was $69.42 per share. On September 26,

2008, the wife, who was unaware that FirstEnergy had mistakenly transferred 100

percent of the husband’s shares of FirstEnergy stock to her, had all 850 shares

deposited into a brokerage account through a direct registration system option. In

March 2009, the wife, still unaware of the mistake, sold the shares of FirstEnergy

stock.

               In April 2009, the husband became aware that FirstEnergy had

transferred 100 percent of his FirstEnergy stock to his wife, notified the wife’s

attorney of the error, and demanded that 50 percent of the shares be transferred back

to his account. The husband also contacted FirstEnergy and informed the company

it had mistakenly transferred all of his FirstEnergy shares of stock to his wife.

               On May 1, 2009, FirstEnergy’s stock closed at $42.38 per share.

FirstEnergy and the wife worked together to transfer 425 shares of FirstEnergy stock

back to the husband. In light of the mistake of the transfer, FirstEnergy offered to

reimburse the husband for the quarterly dividends issued to shareholders during the

period that the shares of stock were not in the husband’s account, but the husband

declined the offer and did not accept a September 1, 2009 dividend check from

FirstEnergy.

               In August 2009, the husband sued both FirstEnergy and the wife for

conversion. The trial court granted summary judgment in favor of FirstEnergy and
the wife and husband appealed. On appeal, the court found that the husband failed

to make a showing of conversion on the part of FirstEnergy or the wife. The court

found that FirstEnergy had provided Civ.R. 56 evidence to show that the shares have

been returned to the husband and FirstEnergy has offered to pay the husband the

missing dividends.

              In this matter, unlike Crowe, 5th Dist. Holmes No. 10CA023, 2011-

Ohio-5092, where the husband was mistakenly dispossessed of the shares, which

were quickly returned once the mistake was discovered, the Harry III Trust

maintained an ownership interest in either the CRC stock or its proceeds, once

redeemed. Having never been dispossessed of its ownership interest in either the

actual CRC shares of stock or the redemptive proceeds, Appellant’s conversion claim

does not survive.

              Finally, although Appellant alleged in the first amended complaint

and also at oral argument, that due to Susan’s cognitive and medical disability, she

was unable to understand or consent to the transaction at issue. However, we find

herein that the conversion claim does not survive because the trust beneficiary was

not dispossessed of an ownership interest in either the CRC shares or the redemptive

proceeds. Since the trust beneficiary always possessed an ownership interest in

either the CRC shares or the redemptive proceeds, Susan’s inability to have

comprehend or to have consented to the transaction is not relevant. As such, the

probate court did not err in dismissing Harry IV’s conversion claim.

              Accordingly, we overrule assignment of error five.
              Judgment affirmed.

      It is ordered that appellees recover from appellant costs herein taxed.

      The court finds there were reasonable grounds for this appeal.

      It is ordered that a special mandate issue out of this court directing the

Cuyahoga County Common Pleas Court, Probate Division, to carry this judgment

into execution.

      A certified copy of this entry shall constitute the mandate pursuant to Rule 27

of the Rules of Appellate Procedure.

_________________________
EMANUELLA D. GROVES, JUDGE

KATHLEEN ANN KEOUGH, P.J., and
EILEEN A. GALLAGHER, J., CONCUR