Court Opinion

ID: 4112214
Source: CourtListenerOpinion
Date Created: 2016-12-29 19:12:05.051085+00
Date Added: 2024-06-11T14:37:15.404160
License: Public Domain

[Cite as Thomas v. Laws, 2016-Ohio-8491.]

                Court of Appeals of Ohio
                              EIGHTH APPELLATE DISTRICT
                                 COUNTY OF CUYAHOGA

                             JOURNAL ENTRY AND OPINION
                                     No. 104710

                             JOAN JACOBS THOMAS
                                                  PLAINTIFF-APPELLANT

                                            vs.

                                       BRIAN LAWS
                                                  DEFENDANT-APPELLEE

                              JUDGMENT:
                  AFFIRMED IN PART, REVERSED IN PART,
                            AND REMANDED

                                    Civil Appeal from the
                           Cuyahoga County Court of Common Pleas
                                  Case No. CV-16-857961

        BEFORE: E.T. Gallagher, P.J., Laster Mays, J., and Celebrezze, J.

        RELEASED AND JOURNALIZED: December 29, 2016
FOR APPELLANT

Joan Jacobs Thomas, pro se
31040 Lorain Road
North Olmsted, Ohio 44070

FOR APPELLEE

Brian Laws, pro se
3332 Virginia Avenue
Cleveland, Ohio 44109
EILEEN T. GALLAGHER, P.J.:

       {¶1} This cause came to be heard on the accelerated calendar pursuant to App.R.

11.1 and Loc.R. 11.1.        Plaintiff-appellant, Joan Jacobs Thomas, Esq. (“Thomas”),

appeals an order granting default judgment in her favor in the amount of $12,500.13.

She raises two assignments of error:

       1.     The decision of the trial court to not award interest on
       plaintiff/appellant’s claim is against the manifest weight of the evidence
       and contrary to law.

       2. The decision of the trial court to award post-judgment interest at the
       statutory rate as opposed to the rate specified in the written contract of the
       parties was against the manifest weight of the evidence and contrary to law.

       {¶2} We find some merit to the appeal, affirm the principal amount of the

judgment, but remand the case to the trial court to award post-judgment interest at the

contract rate instead of the statutory rate.

                             I. Facts and Procedural History

       {¶3} Defendant-appellee, Brian Laws (“Laws”), retained Thomas to represent him

in custody matters in the juvenile division of the Cuyahoga County Common Pleas Court.

 The parties signed an attorney fee agreement wherein Laws agreed to pay Thomas for

legal services at the rate of $250 per hour, and Laws paid a retainer of $2,500. The

attorney fee agreement also provided that “[a]ll past due charges w[ould] be charged a

1.5% per month charge on the unpaid balance.”

       {¶4} Thomas later filed a complaint against Laws in the general division of the

Cuyahoga County Common Pleas Court, alleging that he breached the parties’ attorney
fee agreement by failing to pay for legal services rendered. Thomas further alleged that

Laws owed her a total of $25,201.40, including interest, pursuant to the terms of the

agreement. (Complaint ¶ 5-6.)

       {¶5} Laws failed to plead or otherwise defend himself, and Thomas filed a motion

for default judgment, requesting judgment in the amount of $25,201.40, “along with

statutory interest,” as well as costs of the action. (Default Judgment at 1.) The court

called the case for a default hearing at which Thomas appeared through counsel. Laws

failed to appear even though he was properly served with process. Accordingly, the

court granted Thomas’s motion for default and entered judgment in her favor “in the

amount of $12,500.13 together with interest at the statutory rate from the date of

judgment and court costs.” (Judgment Entry.) Thomas now appeals the trial court’s

judgment.

                                  II. Law and Analysis

                             A. Accrued Contract Interest

       {¶6} In the first assignment of error, Thomas argues the trial court erred in failing

to award the appropriate rate of interest on her damages claim. She contends the court

erroneously failed to include interest at a rate of “1.5% per month” on the unpaid balance

as provided in the parties’ agreement.

       {¶7} R.C. 1343.03, which governs interest rates on contracts and other written

instruments, provides, in relevant part:

       (A) In cases * * * when money becomes due and payable upon any bond,
       bill, note, or other instrument of writing, upon any book account, upon any
       settlement between parties, upon all verbal contracts entered into, and upon
       all judgments, decrees, and orders of any judicial tribunal 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, unless a written contract provides
       a different rate of interest in relation to the money that becomes due and
       payable, in which case the creditor is entitled to interest at the rate
       provided in that contract.

(Emphasis added.)

       {¶8} Thus, where a contract provides an interest rate on money due and owing to a

creditor, the interest rate provided in the contract is the applicable interest rate to be

applied according to the terms of the contract. In this case, Laws agreed to pay interest

at the rate of 1.5% per month on unpaid attorney fees. Therefore, Thomas is entitled to

interest at that rate.

       {¶9} Thomas attached a single unverified invoice to the complaint showing

accrued interest in the amount of $5,173.28. She provided neither an affidavit verifying

the amount of the interest nor an itemization of services performed, hours worked, or bills

sent to Laws for payment. Although a defaulting party admits liability by forfeiting a

defense to liability, the plaintiff must nevertheless establish damages. Reinbolt v. Kern,

183 Ohio App. 3d 287, 2009-Ohio-3492, 916 N.E.2d 1100, ¶ 27 (6th Dist.); McIntosh v.

Willis, 12th Dist. Butler No. CA2004-03-076, 2005-Ohio-1925, ¶ 10.

       {¶10} Thomas requested damages in the amount of $25,201.40 plus interest. The

trial court awarded $12,500.13, plus “interest at the statutory rate from the date of

judgment and court costs.” The trial court did not make any findings regarding the
damages in the record.1 Although the docket shows the court held a default hearing,

there is no transcript of the hearing in the record from which we can evaluate the trial

court’s calculations. The record is also devoid of any dates on which services were

rendered or on which bills were sent to Laws in order to determine the accuracy of the

amount of claimed interest.

       {¶11} The appellant bears the burden of demonstrating error on appeal by

reference to the record of the proceedings below. Knapp v. Edwards Laboratories, 61
Ohio St. 2d 197, 199, 400 N.E.2d 384 (1980); see also Stancik v. Hersch, 8th Dist.

Cuyahoga No. 97501, 2012-Ohio-1955. In the absence of a complete and adequate

record, a reviewing court must presume the regularity of the trial court proceedings and

the presence of sufficient evidence to support the trial court’s decision. Tisco Trading

USA, Inc. v. Cleveland Metal Exchange, Ltd., 8th Dist. Cuyahoga No. 97446,

2012-Ohio-1646, ¶ 6.

       {¶12} We find no evidence in the record demonstrating that the trial court’s

damages determination was against the manifest weight of the evidence because there

exists no evidence in the record apart from the parties’ fee agreement and an unverified

invoice that does not even show an itemized break down of the charges and interest.

       {¶13} Accordingly, the first assignment of error is overruled.

           A trial court rendering a default judgment pursuant to Civ.R. 55 is not required to support
       1

its damages award with findings. Henry v. Richardson, 193 Ohio App. 3d 375, 2011-Ohio-2098, 951
N.E.2d 1123, ¶ 9 (12th Dist.). Civ.R. 52, which governs findings of the court, states that “[f]indings
of fact and conclusions of law required by this rule and by Rule 41(B)(2) are unnecessary upon all
other motions including those pursuant to Rule 12, Rule 55 and Rule 56.”
                               B. Post-judgment Interest

       {¶14} In the second assignment of error, Thomas argues the trial court erred in

awarding post-judgment interest at the statutory rate as opposed to the rate specified in

the parties’ contract. She contends the court’s order charging interest at the statutory rate

is contrary to law.

       {¶15} Where two parties have contractually agreed to a percentage of interest to be

paid on money due and payable under a contract, that percentage is also applicable to any

interest accruing on a judgment arising from the underlying transaction.              Shelly

Materials, Inc. v. Great Lakes Crushing, Ltd., 11th Dist. Portage No. 2013-P-0016,

2013-Ohio-5654, ¶ 59; see also Hobart Bros. Co. v. Welding Supply Serv., Inc., 21 Ohio

App.3d 142, 144, 486 N.E.2d 1229 (10th Dist.1985). Thus, “a judgment creditor is

entitled to an interest rate in excess of the statutory rate when (1) the parties have a

written contract, and (2) that contract provides an interest rate for money that becomes

due and payable.” Shelly Materials, Inc., citing Ohio Neighborhood Fin. Inc. v. Massey,

10th Dist. Franklin Nos. 10AP-1020 and 10AP-1121, 2011-Ohio-2165, ¶ 19.

       {¶16} The trial court’s journal entry granting the default judgment ordered interest

on the judgment at the statutory rate instead of the rate provided in the parties’ agreement.

 This mistake is contrary to law. We therefore sustain the second assignment of error.

                                     III. Conclusion

       {¶17} The trial court’s award of $12,500.13 is not against the manifest weight of

the evidence even though the parties’ agreement provided a monthly interest rate of 1.5
percent on any delinquent attorney fee bills. Although the trial court held a default

hearing, there is no transcript of the hearing in the record, and the record contains no

verified evidence on which to evaluate the trial court’s calculations. We must, therefore,

presume regularity.       Tisco Trading USA, Inc., 8th Dist. Cuyahoga No. 97446,

2012-Ohio-1646, at ¶ 6.

       {¶18} The trial court erred, however, in awarding post-judgment interest at the

statutory rate instead of the interest rate agreed to by the parties as provided in the parties’

agreement.

       {¶19} Accordingly, we affirm that trial court’s award of $12,500.13, reverse the

court’s award of interest at the statutory rate, and remand the case to the trial court to

award post-judgment interest at the rate of 1.5 percent per month as provided in the

parties’ attorney fee agreement.

       It is ordered that appellee and appellant share costs herein taxed.

       The court finds there were reasonable grounds for this appeal.

       It is ordered that a special mandate be sent to said court 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.

EILEEN T. GALLAGHER, PRESIDING JUDGE

ANITA LASTER MAYS, J., and
FRANK D. CELEBREZZE, JR., J., CONCUR