Court Opinion

ID: 9943009
Source: CourtListenerOpinion
Date Created: 2024-02-22 16:12:13.050626+00
Date Added: 2024-06-11T13:45:50.763402
License: Public Domain

[Cite as Stare v. Grange Indemnity Ins. Co., 2024-Ohio-654.]

             IN THE COURT OF APPEALS OF OHIO
                             SEVENTH APPELLATE DISTRICT
                                 MAHONING COUNTY

                                      JERRY STARE ET AL.,

                                        Plaintiffs-Appellants,

                                                      v.

             GRANGE INDEMNITY INSURANCE COMPANY, ET AL.,

                                       Defendants-Appellee.

                        OPINION AND JUDGMENT ENTRY
                                         Case No. 23 MA 0027

                                     Civil Appeal from the
                       Court of Common Pleas of Mahoning County, Ohio
                                   Case No. 2020 CV 01824

                                            BEFORE:
            William A. Klatt, Retired Judge of the Tenth District Court of Appeals,
                                     Sitting by Assignment,
                           Cheryl L. Waite, Mark A. Hanni, Judges.

                                               JUDGMENT:
                                                 Affirmed.

 Atty. J. Michael Goldberg, Law Office of J. Michael Goldberg LLC, for Plaintiffs-
 Appellants and

 Atty. Belinda S. Barnes and Atty. James R. Gallagher, Gallagher, Gams, Tallan, Barnes
 & Littrell LLP, and Atty. Andrew J. Kielkopf, for Defendant-Appellee.

                                      Dated: February 21, 2024
                                                                                     –2–

 KLATT, J.

        {¶1}    Appellants, Jerry and Karen Stare (together “the Stares”), appeal from the
January 23, 2023 judgment of the Mahoning County Court of Common Pleas awarding
them prejudgment interest upon jury verdicts against Appellee, Grange Indemnity
Insurance Company (“Grange”), on an uninsured motorist (“UM”) policy involving an
automobile accident. On appeal, the Stares argue the trial court erred in choosing the
wrong accrual date for purposes of calculating prejudgment interest. Specifically, the
Stares posit the date of the accident (November 10, 2017) must be the date upon which
prejudgment interest began calculating, not the date they refiled their complaint in
Mahoning County (November 10, 2020), as found by the trial court. Finding no reversible
error, we affirm.

                             FACTS AND PROCEDURAL HISTORY

        {¶2}    This case arises from a November 10, 2017 automobile accident in
Columbus, Franklin County, Ohio. An uninsured motorist, Desiree Neal (“Neal”), rear-
ended the Stares’ vehicle. Jerry was the driver and Karen was the front seat passenger.
The Stares suffered bodily injuries as a result of the accident caused by Neal’s
negligence.
        {¶3}    The Stares were covered under an automobile insurance policy issued by
Grange which provided UM/UIM (underinsured) coverage.             There was no dispute
regarding coverage nor any denial that Neal was the sole cause of the accident. Rather,
at issue was the nature and extent of the injuries claimed by the Stares and the valuation
thereof.
        {¶4}    On November 8, 2019, two days before the two-year statute of limitations
ran as to Neal, the Stares filed a complaint against Grange and Neal in Cuyahoga
County.1       On January 10, 2020, the Cuyahoga County Court of Common Pleas
determined Cuyahoga County to be an improper venue and transferred the case to
Franklin County. While the case was pending in Franklin County, the Stares filed a motion
on April 21, 2020 to transfer the matter to Mahoning County. On August 20, 2020, the

1 Neal later filed for bankruptcy and was discharged.

Case No. 23 MA 0027
                                                                                        –3–

Franklin County Court of Common Pleas denied the Stares’ motion.               The Stares
subsequently voluntarily dismissed the case.
       {¶5}   On November 10, 2020, three years after the accident, the Stares refiled
their complaint in Mahoning County alleging negligence, loss of consortium and effect on
family relationships, and first party insurance coverage and bad faith. Grange filed an
answer and a cross-claim against Neal on December 11, 2020. On January 20, 2021,
Grange voluntarily dismissed its cross-claim against Neal without prejudice.
       {¶6}   Throughout this action, the Stares refused to negotiate from their initial
demands of $100,000 each (the “each person” UM coverage limit) despite attending
mediation. Numerous documented delays occurred at the trial court level.
       {¶7}   On January 25, 2021, Grange filed a motion to bifurcate the bad faith cause
of action and stay bad faith discovery. On February 8, 2021, the day their memorandum
contra was due, the Stares moved for an extension to respond, which was sustained. On
February 17, 2021, the Stares filed a brief in opposition and a supplement four days later.
       {¶8}   On March 1, 2021, Grange filed a motion for summary judgment. On March
24, 2021, the Stares filed a brief in opposition and a partial motion for summary judgment.
On May 18, 2021, by unanimous consent of the parties, a jury trial on all issues and
motions were referred to the magistrate and the summary judgment motions were
withdrawn.
       {¶9}   Mediations and a pretrial were scheduled. On January 18, 2022, three days
after their discovery deadline, the Stares moved to extend the expert report deadlines
and to reset the non-expert fact deadlines, which was sustained. Mediation was at an
impasse.
       {¶10} A final pretrial conference was held on June 22, 2022. The Stares still
refused to lower their demands under the policy limits. As a result, Grange had no
meaningful ability to work toward a settlement with the Stares for nearly five years.
       {¶11} A jury trial on the contractual claims commenced on August 8, 2022. The
jury found in favor of the Stares. Jerry was awarded $8,000 and Karen $70,000 in
compensatory damages against Grange. On August 15, 2022, the magistrate filed an
entry upon jury’s verdicts and indicated that the Stares’ bifurcated claims for bad faith
remain pending against Grange for further adjudication upon the merits. That same date,

Case No. 23 MA 0027
                                                                                           –4–

the trial court filed an entry indicating that its final judgment is entered consistent with the
magistrate’s entry upon jury’s verdicts.
       {¶12} On September 12, 2022, the Stares filed a motion for prejudgment interest
pursuant to R.C. 1343.03(A) on the contractual UM damages verdicts, and an amended
motion the following day. Karen requested a prejudgment interest award of $13,601.39
and Jerry requested an award of $1,554.44. The Stares argued the date of the accident
(November 10, 2017), nearly five years prior to the jury award, must be the date upon
which prejudgment interest began calculating. Grange disagreed and argued the trial
court was within its right to select a more appropriate date for the accrual of prejudgment
interest. On October 4, 2022, the day after it was due, the Stares requested a three-day
extension to file their reply to their motion for prejudgment interest which was granted.
On October 7, 2022, the Stares moved for an additional seven-day extension which was
granted. The Stares filed their reply on October 14, 2022.
       {¶13} Following a hearing, on November 3, 2022, the magistrate filed an entry and
award of prejudgment interest.          The magistrate found the following: “to award
prejudgment interest from the date of the accident would be unjust”; the Stares’ “conduct
in prosecuting this litigation caused unusual and unnecessary delay as a result of which
they should not experience a windfall”; “the appropriate accrual date for purposes of
calculating an award of prejudgment interest is November 10, 2020[,]” the date the case
was refiled in Mahoning County; “the Magistrate utilized the Tax Commissioner’s
determination of interest rates provided by [the Stares]”; the magistrate found in favor of
Jerry and against Grange in the amount of $423.60 and in favor of Karen and against
Grange in the amount of $4,000; and the magistrate further indicated that the Stares’
“bifurcated claims for bad faith remain pending against [Grange] for further adjudication
upon the merits.” (11/3/2022 Magistrate’s Entry and Award of Prejudgment Interest, p. 2-
3).
       {¶14} On November 21, 2022, the trial court filed an entry indicating that “the Final
Judgment Entry of this Court is entered consistent with the Magistrate’s Entry and Award
of Prejudgment Interest filed on November 3, 2022.” (11/21/2022 Judgment Entry).
       {¶15} On December 22, 2022, Grange filed a notice of tender. On January 18,
2023, the Stares filed a notice of dismissal of Neal. On January 19, 2023, the trial court

Case No. 23 MA 0027
                                                                                                         –5–

entered its final judgment consistent with the magistrate’s entry upon jury’s verdicts filed
on August 15, 2022, in favor of Jerry in the amount of $8,000 and in favor of Karen in the
amount of $70,000. The court again noted the Stares’ “bifurcated claims for bad faith
remain pending against [Grange] for further adjudication upon the merits.” (1/19/2023
Judgment Entry, p. 2).
          {¶16} Because the trial court failed to include “no just reason for delay” language
in its November 21, 2022 entry, the Stares requested that Civ.R. 54(B) language be
added. The court complied and filed a final appealable order on January 23, 2023.
          {¶17} The Stares filed a timely notice of appeal and raise one assignment of
error.2

                                      ASSIGNMENT OF ERROR

          THE TRIAL COURT COMMITTED REVERSIBLE ERROR BY DEPRIVING
          APPELLANTS OF PREJUDGMENT INTEREST THEY WERE ENTITLED
          TO UNDER R.C. 1343.03(A).

          {¶18} In the Stares’ sole assignment of error, they argue the trial court erred in
choosing the wrong accrual date for purposes of calculating prejudgment interest.
Specifically, the Stares claim the date of the accident (November 10, 2017) must be the
only date upon which prejudgment interest began calculating, not the date they refiled
their complaint in Mahoning County (November 10, 2020), as found by the trial court. The
Stares contend this court must apply a de novo standard of review and claim that Landis
v. Grange Mutual Ins. Co., 82 Ohio St.3d 339 (1998) “has no precedential value.”
(9/5/2023 Appellants’ Reply Brief, p. 2). We disagree.

          In Ohio, the leading case on the issue of prejudgment interest in an UM/UIM
          claim is Landis v. Grange Mutual Ins. Co. (1998), 82 Ohio St.3d 339, 695

2 In addition to the numerous documented delays at the trial court level, delays occurred at this court’s level

as well, including motions by the Stares for extensions to file the trial transcripts and motions by the Stares
for extensions to file their appellate brief. Ultimately, when the Stares had not filed their brief by July 31,
2023, Grange filed a motion to dismiss the appeal for failure to prosecute. Following a status conference,
this court granted a final extension and the Stares finally filed their brief on August 4, 2023.

Case No. 23 MA 0027
                                                                                          –6–

      N.E.2d 1140. In Landis, the Supreme Court of Ohio recognized that UM/UIM
      claims are contractual in nature and therefore subject to R.C. 1343.03(A)
      with respect to the award and calculation of interest. Id. at 341, 695 N.E.2d
      1140. R.C. 1343.03(A) provides in pertinent part: “(W)hen money becomes
      due and payable upon any (* * *) instrument of writing (* * *) and upon all
      judgments (* * *) for the payment of money arising out of tortious conduct or
      a contract or other transaction, the creditor is entitled to interest at the rate
      per annum determined pursuant to section 5703.47 of the Revised Code(.)”

      In Landis, the insured was covered by the UM provisions of his employer’s
      automobile insurance policy, with limits of $1,000,000. The insured was
      walking in Sandusky, Ohio, when he was struck by an underinsured
      motorist. The tortfeasor’s insurer paid the liability limit of $100,000 to Mr.
      Landis, and he presented a UM claim to Grange. Grange denied the claim,
      and Mr. Landis filed a declaratory judgment action to determine coverage.
      The trial court eventually ruled in Mr. Landis’ favor and the case was
      submitted to an arbitrator to determine damages pursuant to the terms of
      the insurance policy. The arbitrator awarded the full policy limits as
      damages. Mr. Landis then filed a motion for prejudgment interest, which
      was denied. The prejudgment interest issue was appealed to the Ohio
      Supreme Court.

      Landis held that a UM/UIM claim sounds in contract rather than tort and is
      governed by the section of the prejudgment interest statute dealing with
      contract claims, R.C. 1343.03(A). The Landis Court further reasoned that
      whether prejudgment interest “should be calculated from the date coverage
      was demanded or denied, from the date of the accident, from the date at
      which arbitration of damages would have ended if Grange had not denied
      benefits, or some other time based on when Grange should have paid
      Landis is for the trial court to determine.” (Emphasis added.) Id. at 342, 695
      N.E.2d 1140. * * *

Case No. 23 MA 0027
                                                                                       –7–

      ***

      Landis further explained that “(* * *) (insurance companies) will be subject
      to a prejudgment interest award, not as a punishment but as a way to
      prevent them from using money then due and payable to another for their
      own financial gain.” Id. at 341, 695 N.E.2d 1140.

      A motion for prejudgment interest is committed to the discretion of the trial
      court. Pruszynski v. Reeves, 117 Ohio St.3d 92, 2008-Ohio-510, 881
      N.E.2d 1230, ¶ 14. Therefore, a reviewing court may not reverse that
      decision absent an abuse of discretion by the trial court. Abuse of discretion
      * * * implies that the trial court’s attitude is unreasonable, arbitrary, or
      unconscionable. Blakemore v. Blakemore (1983), 5 Ohio St.3d 217, 219, 5
      OBR 481, 450 N.E.2d 1140.

      An award of prejudgment interest is intended to encourage prompt
      settlement and discourage defendants from opposing and prolonging,
      between injury and judgment, the resolution of legitimate claims. Royal
      Elec. [Constr. v. Ohio State Univ.,] 73 Ohio St.3d [110] at 116, 652 N.E.2d
      687 [(1995)]. A party seeking interest under R.C. 1343.03(A) need not
      demonstrate that the insurer acted in bad faith. Craig v. Grange Ins. Co.
      (Nov. 5, 1999), 2d Dist. No. 17675. Prejudgment interest is not intended to
      punish the party responsible for the underlying damages. Rather, it acts to
      compensate and ultimately to make the aggrieved party whole. See,
      McCormick, Damages (1935), 205, Section 50 et seq.; 3 Restatement of
      the Law 2d, Contracts (1981), 150-151, Section 354(2).

      To determine the amount of prejudgment interest warranted in a particular
      case, the trial court must inquire whether the aggrieved party has been fully
      compensated. Royal Elec. at 116, 652 N.E.2d 687. The award of
      prejudgment interest is intended to compensate the plaintiff for the period
      of time between accrual of the claim and judgment. Id. at 117, 652 N.E.2d
      687. R.C. 1343.03(A) applies even when the judgment arises from a

Case No. 23 MA 0027
                                                                                         –8–

       disputed claim and when the sum due was not capable of being ascertained
       until determined by the court. Yuhanick v. Cooper (March 14, 2001), 7th
       Dist. 99 CO 37.

Persello v. Allstate Ins. Co., 7th Dist. Mahoning No. 10 MA 18, 2011-Ohio-3230, ¶ 7-9,
12-15.

       {¶19} In this case, the trial court did not abuse its discretion in determining that
the date of accrual for prejudgment interest should be the date the Stares refiled their
complaint in Mahoning County (November 10, 2020) as trial courts have discretion in
determining a reasonable date of accrual. Landis, supra, at 342 (Whether prejudgment
interest should be calculated from the date coverage was demanded or denied, from the
date of the accident, or from some other time is for the trial court to determine.); Persello,
supra, at ¶ 9, 13.
       {¶20} As stated, the trial court determined the following: “to award prejudgment
interest from the date of the accident would be unjust”; the Stares’ “conduct in prosecuting
this litigation caused unusual and unnecessary delay as a result of which they should not
experience a windfall”; and “the appropriate accrual date for purposes of calculating an
award of prejudgment interest is November 10, 2020[,]” the date the case was refiled in
Mahoning County. (11/3/2022 Magistrate’s Entry and Award of Prejudgment Interest, p.
2); (11/21/2022 Judgment Entry).
       {¶21} The automobile accident occurred on November 10, 2017 in Columbus,
Franklin County, Ohio. On November 8, 2019, two days before the two-year statute of
limitations ran as to Neal, the Stares filed a complaint in Cuyahoga County, an improper
venue. The case was subsequently transferred to Franklin County. The Stares later
voluntarily dismissed the case. On November 10, 2020, three years after the accident,
the Stares refiled the case in Mahoning County. As addressed, throughout this action,
numerous documented delays occurred at the trial court level. The Stares refused to
negotiate from their initial demands of $100,000 each (the “each person” UM coverage
limit) despite attending mediation. Even at the final pretrial conference held on June 22,
2022, the Stares still refused to lower their demands under the policy limits. As a result,
Grange had no meaningful ability to work toward a settlement with the Stares for nearly
five years.

Case No. 23 MA 0027
                                                                                       –9–

       {¶22} The Stares’ position that the date of accrual for an award of prejudgment
interest is always the date of the accident is both misplaced and unfounded under Ohio
law. Landis, supra, at 342 (Whether prejudgment interest should be calculated from the
date coverage was demanded or denied, from the date of the accident, or from some
other time is for the trial court to determine.); Persello, supra, at ¶ 9, 13. Grange aptly
posits the following:

       If, as [the Stares] argue, the date of accrual for an award of prejudgment
       interest is always the date of the accident, plaintiffs in general will be
       afforded an amazing money-making opportunity. By delaying the case for
       years, plaintiffs can take advantage of the statutory interest rate, which
       interest rate currently exceeds the interest offered if the funds were placed
       in a checking or savings account or a certificate of deposit. This is why the
       Ohio Supreme Court and lower appellate courts have expressly rejected
       [the Stares’] argument that prejudgment interest must start from the date of
       the accident and have given the trial courts the discretion to choose a fair
       and equitable date for the accrual of prejudgment interest. In doing so, they
       have struck a balance between encouraging insurance carriers to
       expediently settle meritorious claims while preventing insureds from
       benefiting from their own delay in prosecuting a case.

(8/23/2023 Appellee’s Brief, p. 9-10).

       {¶23} The purpose of prejudgment interest is not to punish a defendant.
“[P]rejudgment interest does not punish the party responsible for the underlying damages
* * *, but, rather, it acts as compensation and serves ultimately to make the aggrieved
party whole.” Royal Elec., supra, at 117. An award of prejudgment interest dating back
nearly five years due to delays the trial court determined were caused solely by the Stares
would certainly serve to punish Grange.
       {¶24} It was within the trial court’s discretion to determine a reasonable date for
prejudgment interest. Landis, supra, at 342; Persello, supra, at ¶ 9, 13. Based on the
facts presented and the record before us, the court did not abuse its discretion in

Case No. 23 MA 0027
                                                                                   – 10 –

determining November 10, 2020, the date the action was refiled in Mahoning County, to
be a fair and equitable date to start the running of prejudgment interest.

                                     CONCLUSION

       {¶25} For the foregoing reasons, the Stares’ sole assignment of error is not well-
taken. The January 23, 2023 judgment of the Mahoning County Court of Common Pleas
is affirmed.

Waite, J., concurs.

Hanni, J., concurs.

Case No. 23 MA 0027
[Cite as Stare v. Grange Indemnity Ins. Co., 2024-Ohio-654.]

         For the reasons stated in the Opinion rendered herein, the assignment of error
 is overruled and it is the final judgment and order of this Court that the judgment of the
 Court of Common Pleas of Mahoning County, Ohio, is affirmed. Costs to be taxed
 against the Appellants.
         A certified copy of this opinion and judgment entry shall constitute the mandate
 in this case pursuant to Rule 27 of the Rules of Appellate Procedure. It is ordered that
 a certified copy be sent by the clerk to the trial court to carry this judgment into
 execution.

                                        NOTICE TO COUNSEL

         This document constitutes a final judgment entry.