Court Opinion

ID: 6699353
Source: CourtListenerOpinion
Date Created: 2022-07-20 22:04:48.031704+00
Date Added: 2024-06-11T16:01:21.905560
License: Public Domain

Kline, J.,
dissenting.
{¶ 18} I respectfully dissent.
{¶ 19} First, I believe that we may review the trial court’s denial of the McClures’ motion for summary judgment. I agree that the denial of a motion for summary judgment does not constitute a final, appealable order. However, in this case, we may review the denial of the McClures’ motion for summary judgment because it is an interlocutory order that has merged into the final judgment. See Hendrickson v. JGR Properties, Inc., Butler App. No. CA200802-056, 2008-Ohio-6192, 2008 WL 5053440, ¶ 8, citing Nayman v. Kilbane (1982), 1 Ohio St.3d 269, 271, 1 OBR 379, 439 N.E.2d 888 (“A trial court’s entry denying a motion for summary judgment is an interlocutory order and subject to reconsideration any time before the entry of final judgment in the case”); Beatley v. Knisley, No. 08AP-696, 183 Ohio App.3d 356, 2009-Ohio-2229, 917 N.E.2d 280, *34¶ 9, citing Grover v. Bartsch, 170 Ohio App.3d 188, 2006-Ohio-6115, 866 N.E.2d 547, ¶ 9 (“Interlocutory orders merge into the final judgment, and thus, an appeal from a final judgment allows an appellant to challenge both the final judgment and any interlocutory orders merged with it”). See also Peebles Elderly Hous. Ltd. Partnership v. Titan Indem. Co. (Sep. 15, 1997), Adams App. No. 96CA631, 1997 WL 578735, citing Balson v. Dodds (1980), 62 Ohio St.2d 287, 16 O.O.3d 329, 405 N.E.2d 293 (“Although it is unusual for this court to review the denial of a motion for summary judgment, the Ohio Supreme Court has held that a movant may appeal the denial of such a motion after a subsequent adverse final judgment”); McCoy v. Usuani, Hamilton App. No. C-080635, 2009-Ohio-3095, 2009 WL 1830734; Rodgers v. Pahoundis, 178 Ohio App.3d 229, 2008-Ohio-4468, 897 N.E.2d 680; Monastero v. Novak, Cuyahoga App. No. 89656, 2008-Ohio-1947, 2008 WL 1822418; Schwenke v. Wayne-Dalton Corp., No. 07-CA-003, 2008-Ohio-1412, 2008 WL 795380; Bobb Forest Prods., Inc. v. Morbark Industries, Inc., 151 Ohio App.3d 63, 2002-Ohio-5370, 783 N.E.2d 560, ¶ 40. Therefore, I believe that we have the authority to review the McClures’ assignment of error “as is.” We need not construe it as something else.
{¶ 20} Further, like the trial court, I believe that the clause at issue is a prepayment penalty clause. The contract states that “[t]he Borrowers agree that without prior consent they will not in any one calendar year pay an amount in excess of ten percent of the principle [sic] balance of the promissory note and if they should pay an amount in excess of ten per cent of the remaining principal they agree to pay a penalty equal to sixteen per cent (16%) of the amount of principal that exceeds the ten per cent allowance.” As a general rule, “[c]ommon words appearing in a written instrument will be given their ordinary meaning.” Skirvin v. Kidd, 174 Ohio App.3d 273, 2007-Ohio-7179, 881 N.E.2d 914, ¶ 14, citing Alexander v. Buckeye Pipe Line Co. (1978), 53 Ohio St.2d 241, 7 O.O.3d 403, 374 N.E.2d 146, at paragraph two of the syllabus. The ordinary meaning of “penalty” is “the suffering or the sum to be forfeited to which a person subjects himself by covenant or agreement in case of nonfulfillment of stipulations.” (Emphasis added.) Webster’s Third New International Dictionary, Unabridged (2002).
(¶ 21} Here, under the McClures’ interpretation of the contract, Davis could not have completed the contract without incurring the 16 percent penalty at least, once. By definition, paying off the remaining principal would have required paying an amount in excess of 10 percent of the “principal balance.” Therefore, I believe that the McClures’ interpretation of the contract ignores the ordinary meaning of the word “penalty.” Davis could not have failed to fulfill a stipulation and thereby owe a penalty if the stipulation itself was impossible to fulfill.
*35{¶ 22} In contrast, I would give meaning to the word “penalty” by interpreting the clause as a prepayment penalty clause. This interpretation comports with the reality of the contract. Namely, if Davis adhered to the stipulations of the agreement, there would necessarily be a balance remaining when the note matured. And in my view, one cannot be penalized for adhering to the terms of a contract. Thus, I believe that the penalty provision must be interpreted as a prepayment penalty clause. This is the only way that this payment, a payment equal to 16 percent of the amount of principal that exceeds the 10 percent allowance, could be considered a penalty instead of a mandatory additional payment.
{¶ 23} Further, I note that the McClures misstate the nature of the contract. In their appellate brief, the McClures write, “In fact, Appellee[] could have completely avoided any additional interest payments if he had paid ten percent each year from 1992-2002.” However, this statement does not accord with (1) the realities of the contract, as mentioned above, or (2) the McClures’ own actions in this case. Here, every payment on the principal would have decreased the principal balance. Thus, if Davis had paid 10 percent of the principal each year, he would have had approximately $15,690.53 left on the principal balance at the end of the original ten-year contract. In the present case, the McClures are seeking $6,480 in addition to Davis’s lump-sum payment of $45,000. Presumably, the McClures would have also sought the “penalty payment” in addition to a lump-sum payment of $15,690.53.
{¶ 24} For these reasons, I respectfully dissent and would affirm the judgment of the trial court.