Court Opinion

ID: 2742195
Source: CourtListenerOpinion
Date Created: 2014-10-14 20:14:09.24333+00
Date Added: 2024-06-11T09:55:17.139054
License: Public Domain

[Cite as Lumber Yard, Inc. v. Lasure, 2014-Ohio-4556.]

                                       COURT OF APPEALS
                                     LICKING COUNTY, OHIO
                                   FIFTH APPELLATE DISTRICT

LUMBER YARD, INC.                                           JUDGES:
                                                            Hon. William B. Hoffman, P.J.
        Plaintiff-Appellee                                  Hon. W. Scott Gwin, J.
                                                            Hon. John W. Wise, J.
-vs-
                                                            Case No. 14-CA-14
KENNETH D. LASURE, ET AL.

        Defendants/Third-Party                              OPINION
        Plaintiffs-Appellants

-vs-

ABLE BUILDING SERVICE, INC.,

        Third-Party Defendant-Appellee

CHARACTER OF PROCEEDING:                                 Appeal from the Licking County Court of
                                                         Common Pleas, Case No. 11 CV 00433

JUDGMENT:                                                Reversed

DATE OF JUDGMENT ENTRY:                                  October 10, 2014

APPEARANCES:

For Third-Party                                          For Defendants/Third-Party
Defendant-Appellee                                       Plaintiffs-Appellants

DANIEL O. BARHAM                                         DAVE LACKEY
Barham Legal, LLC                                        Scherner & Sybert LLC
2670 N. Columbus St., Ste F                              153 S. Liberty St.
Lancaster, Ohio 43130                                    Powell, Ohio 43065
[Cite as Lumber Yard, Inc. v. Lasure, 2014-Ohio-4556.]

Hoffman, P.J.

         {¶1}   Defendants/Third-Party Plaintiffs-Appellants Kenneth D. Lasure and Debra

L. Lasure appeal the February 26, 2014 Judgment Entry entered by the Licking County

Court of Common Pleas granting the motion for relief from judgment in favor of Third-

Party Defendant-Appellee Able Building Service, Inc.

                                        STATEMENT OF THE CASE1

         {¶2}   On March 28, 2011, the Lumber Yard, Inc. filed a complaint seeking

foreclosure of its affidavit for mechanics' lien. Appellants, Kenneth D. and Debra L.

Lasure filed an answer, counterclaim, cross-claim, and third-party complaint.              The

cross-claim asserted a cause of action against Able Building Service, Inc. The third-

party complaint added a cause of action as to Jed Dawson, individually. Jed Dawson

and his wife, Judith Dawson, are each fifty-percent shareholders in Able Building

Service, Inc. Judith Dawson is an officer of Able Building Service, and was authorized to

handle all of Able Business Service's business affairs.

         {¶3}   On June 8, 2012, Appellants Kenneth and Debra Lasure filed a motion for

partial summary judgment as to their claims against Able Building Service, Inc. and Jed

Dawson, Individually. On September 4, 2012, Lumber Yard dismissed its complaint

after voluntarily releasing its mechanic's lien.

         {¶4}   The trial court scheduled the remaining claims between Able Building

Service, Inc., Dawson, and Appellants for trial on February 26, 2013.

1
    A full rendition of the underlying facts is unnecessary for our resolution of the appeal.
Licking County, Case No. 14-CA-14                                                3

      {¶5}   Via Judgment Entry of January 22, 2013, the trial court granted counsel of

record for Able Building Service, Inc. and Dawson the opportunity to withdraw as

counsel.

      {¶6}   A bench trial was conducted on February 26, 2013, and Able Building

Service, Inc. and Jed Dawson appeared without representation of legal counsel.

      {¶7}   Via Judgment Entry of March 14, 2013, the trial court awarded judgment in

favor of Appellants, including findings of fact and conclusions of law. The trial court

found Able Building Service, Inc. in default for failure to appear at trial with legal

counsel. The trial court further awarded judgment in favor of Appellants against Jed

Dawson, individually.

      {¶8}   On October 15, 2013, Able Building Service, Inc. moved for relief from

judgment, pursuant to Civil Rule 60(B). On the same date, Jed Dawson also moved for

relief from judgment pursuant to Civil Rule 60(B). Appellants filed a memorandum

contra. The trial court scheduled the matter for hearing on January 24, 2014.

      {¶9}   Jed Dawson transferred all of his shares in Able Business Service, Inc. to

Judith Dawson. On December 13, 2013, Jed Dawson withdrew his motion for relief from

judgment.

      {¶10} Via Judgment Entry of February 26, 2014, the trial court granted Able

Building Service's motion for relief from judgment.

      {¶11} Appellants now appeal, assigning as error:

      {¶12} "I. THE TRIAL COURT ABUSED ITS DISCRETION IN GRANTING

ABLE'S MOTION FOR RELIEF FROM JUDGMENT."
Licking County, Case No. 14-CA-14                                                 4

                                                I

       {¶13} In Fifth Third Bank v. Labate, Stark App. 2005CA00180, 2006-Ohio-4239,

this Court held,

       {¶14} "Civil Rule 60(B) represents an attempt to 'strike a proper balance

between the conflicting principles that litigation must be brought to an end and justice

should be done.' Colley v. Bazell (1980), 64 Ohio St.2d 243, 248, 416 N.E.2d 605

(Citation omitted). The grant or denial of a motion for relief from judgment under Civ.R.

60(B) rests within the sound discretion of the trial court and will not be disturbed absent

an abuse of discretion. Griffey v. Rajan (1987), 33 Ohio St.3d 75, 77, 514 N.E.2d 1122.

An abuse of discretion connotes more than an error of law or judgment; it implies the

court's attitude is unreasonable, arbitrary or unconscionable. Blakemore v. Blakemore

(1983), 5 Ohio St.3d 217, 219, 450 N.E.2d 1140. Further, in examining the trial court's

denial of a motion for relief from judgment this Court does not review the correctness of

the original judgment from which relief is sought, but rather we are limited to

determining whether the trial court abused its discretion in failing to grant relief from

judgment. Kochalko v. Kochalko, Guernsey App. No. 04CA15, 2004-Ohio-7098

(Citations omitted).

       {¶15} "In order to prevail on a motion brought pursuant to Civ.R. 60(B), ' * * * the

movant must demonstrate that (1) the party has a meritorious defense or claim to

present if relief is granted; (2) the party is entitled to relief under one of the grounds

stated in Civ.R. 60(B)(1) through (5); and (3) the motion is made within a reasonable

time, and, where the grounds of relief are Civ.R. 60(B)(1), (2) or (3), not more than one

year after the judgment, order or proceedings was entered or taken.' Argo Plastic
Licking County, Case No. 14-CA-14                                                     5

Products Co. v. Cleveland (1984), 15 Ohio St.3d 389, 391, 474 N.E.2d 328, citing GTE

Automatic Electric v. ARC Industries (1976), 47 Ohio St.2d 146, 351 N.E.2d 113,

paragraph two of the syllabus. If any prong of this requirement is not satisfied, relief

shall be denied. Argo at 391, 474 N.E.2d 328."

        {¶16} At the hearing on Able's motion for relief from judgment, Jed Dawson

testified,

        {¶17} "Q. So when did you become aware that your counsel had withdrawn?

        {¶18} "A. It would have been sometime shortly after this date; probably late - -

late in January I'm guessing.

        {¶19} "Q. Okay. And what was your understanding that that meant?

        {¶20} "A. That they were basically done providing any service to me.

        {¶21} "Q. What about Able?

        {¶22} "A. The same.

        {¶23} "Q. So what did you do after that?

        {¶24} "A. Just waited for the date to come to court.

        {¶25} "Q. Did you seek out any other counsel?

        {¶26} "A. No sir.

        {¶27} "Q. Did you advise Mrs. Dawson of the situation?

        {¶28} "A. No, I did not.

        {¶29} "Q. Did you check to see whether you could represent Able?

        {¶30} "A. No. No, I didn't even know there was - - that I couldn't legally.

        {¶31} "* * *
Licking County, Case No. 14-CA-14                                                      6

         {¶32} "Q. All right. We'll pick up where we left off. I don't recall if I asked this

question. I'll just go ahead and ask you. To your knowledge, when did Judith Dawson

become aware of these - - these letters that we've just discussed, 3, 4, 5, and 6?

         {¶33} "A. Not until late August.

         {¶34} "Q. Okay.      What were the circumstances in late August where she

became aware of it?

         {¶35} "A. The - - the findings from the Court, and I - - I told her all the - - kind of

laid everything out and told her what was going on, what had happened, and revealed

all that to her in late August.

         {¶36} "Q. Is it your testimony there'd been no other discussions about - -

         {¶37} "A. Correct.

         {¶38} "Q. No other discussions about the case with Judith Dawson until that

point?

         {¶39} "A. Correct.

         {¶40} "Q. Why not?

         {¶41} "A. It's hard to say. I thought - - I thought that if I came in and told my side

of the story to the Judge, and you know, that things would be, you know, he would hear

and, you know, things would come out in a good way, and that she didn't - - she just

didn't need to know and be concerned. She gets very upset about things that are out of

control and her control. I - - I don't know why not.

         {¶42} "Q. How long have you been married to Mrs. Dawson?

         {¶43} "A. Thirty-four years.
Licking County, Case No. 14-CA-14                                                7

        {¶44} "Q. Based on what you know and your time together and what you know

of Mrs. Dawson, what do you think her reaction would have been if she had been made

aware of this matter prior to trial?

        {¶45} "MR. LACKEY: Objection.

        {¶46} "THE COURT: Response?

        {¶47} "MR. BARHAM: Based on his knowledge of being married to the woman

for 34 years. He's observed her for that long, and I'll ask what he thinks her reaction

would have been.

        {¶48} "MR. LACKEY: It's speculative at this point for him to guess what her

reaction would have been. She can testify later what her reaction might have been.

        {¶49} "THE COURT: Isn't it speculation for it - - to ask it?

        {¶50} "THE BARHAM: I think it goes to his motivation for - - to concealing it and

what he - - and also goes to his active concealment of it being a breach of his fiduciary

duty.

        {¶51} "THE COURT: Okay. I'm going to allow it. Over-ruled.

        {¶52} "A. I - - I think that she would have been thorough in preparation for the

trial; made sure that I would have come in with an attorney. If indeed I wasn't allowed

to, I think she would have found out the things that I - - the answers that I didn't have,

she would have tried to find those out before the trial.

        {¶53} "Q. How did any concerns for your marriage figure into your decision to

either conceal or not - - or eventually tell her?
Licking County, Case No. 14-CA-14                                                  8

       {¶54} "A. Well, it's definitely been difficult on our marriage that the whole - - the

whole case, the problems, and the case, and then the subsequent judgment has been

extremely difficult. Does that answer your question?

       {¶55} "Q. Not really, but I think that's fine. After you finally told Mrs. Dawson,

how did she react?

       {¶56} "A. We went and hired a new attorney.

       {¶57} "Q. Did she do anything else?

       {¶58} "A. Well, there was, you know, the - - the moments of upset and unbelief

and, you know, why - - why wouldn't - - why wouldn't you, that kind of thing.

       {¶59} Tr. at 20-21; 29-32

       {¶60} The testimony evidences Jed Dawson's assumption he could represent

both himself and the corporation at trial, and hope the trial court "would see his side of

the story." His intention was to testify on behalf of himself and Able Building Service,

Inc. and he did not intend to present expert witnesses.

       {¶61} Judith Dawson testified at the time of the trial, she was an equal

shareholder in Able Building Service, Inc. and an officer of the company. She stated her

title is Secretary of the corporation. Tr. at 43.

       {¶62} Judith Dawson testified she first learned of the judgment in August of

2013. Tr. at 44. She further testified,

       {¶63} "Q. Before suit was filed, were you aware that a dispute had arisen with

the Lasures?

       {¶64} "A. I knew that Jed - - I knew that they owed him money and that he and

the Lumber Yard were trying to collect, and I knew that there had been a countersuit in
Licking County, Case No. 14-CA-14                                               9

terms of, you know, that's - - that's what you expect. When you sue somebody, they

sue you, and that's about the extent of what I knew was going on.

       {¶65} "Q. When did you know that?

       {¶66} "A. Once he walked off the job. Once he was no longer working in Licking

County, I knew why. I knew that he was - - and so that's when I would have known.

That was why we weren't finishing that house.

       {¶67} "Q. You knew at that point there was a dispute. When did you know about

the suit being filed and the countersuit?

       {¶68} "A. I don't know.

       {¶69} "Q. Were you - -

       {¶70} "A. You know, honestly I don't know that he - - I don't know that Jed ever

said to me. I think - - I think I know that much about when someone's - - when you sue

somebody.

       {¶71} "Q. Okay. Were you aware that Jed walked off the job after the Lasures

had simply asked him to correct some of the past mistakes before they issued further

draws?

       {¶72} "A. Let me think back. I - - I - - Jed was very distressed. He found - - I

know he had a lot of difficulty working for these particular clients. There was a lot

tension on the job, a lot of inability to communicate. I'm recalling, and I think at some

point, I remember him just saying, 'I - - I just - - I can't go on. I just can't. I can't

continue,' and so - - yeah, he didn't.

       {¶73} "Q. Were you aware that he filed a mechanics' lien? And I'm asking your

awareness at that time, prior to the suit, but were you aware?
Licking County, Case No. 14-CA-14                                                  10

       {¶74} "A. I don't know that I would have known to call it that. I knew they owed

us money. I knew that part of what they owed us the company needed to pay to the

Lumber Yard, and I thought that that first contacting the lawyer was sort of a joint, you

know, we - - we couldn't just take our losses and - -- and stop because we owed the

Lumber yard for materials in their home."

       {¶75} Tr. at 53-55.

       {¶76} Ohio law clearly sets forth ignorance of the law is not an excuse for civil

litigants. Kier v. Kier, 2007-Ohio-4190. Failure to properly defend an action because of

a failure to understand the law cannot serve as justification for relief from judgment

under Civil Rule 60(B). National City Bank v. Poling, 2005-Ohio-585.

       {¶77} Here, Jed Dawson's mistaken belief the trial court would look past his

inability to represent Able Business Service, Inc. at trial cannot serve as justification for

relief from judgment under Civil Rule 60(B). In addition, Judith Dawson testified she

was aware of a dispute between the Lasures and the corporation and the

commencement of litigation as soon as Jed Dawson walked off the job. She knew of a

dispute between the corporation and Appellants. She knew a lawyer had been retained.

Therefore, Jed and Judith Dawson, as fifty-percent shareholders of Able Building

Service, Inc., knew of the lawsuit. While Jed Dawson may have breached his fiduciary

duty to the corporation and its other shareholder, his alleged breach does not provide

grounds to vacate Appellants' judgment against Appellee.
Licking County, Case No. 14-CA-14                                         11

      {¶78} Appellants' sole assignment of error is sustained, and the February 26,

2014 Judgment Entry of the Licking County Court of Common Pleas is reversed.

By: Hoffman, P.J.

Gwin, J. and

Wise, J. concur