Court Opinion

ID: 3701020
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:39:43.0181+00
Date Added: 2024-06-11T15:39:30.202438
License: Public Domain

In this case we have the issue of whether the making of a Civ. R. 53(E) objection by appellants' counsel is of such mandatory nature as to deprive the Court of Appeals of the right to consider plain error in the referee's Findings of Fact and Conclusions of Law as adopted by the court. The position taken in the majority opinion is that Civ. R. 53(E) requirements are of such mandatory nature as to require affirmance of the judgment, *Page 202 
irrespective of the nature of the error appearing on the face of the judgment entry appealed from.
In this cause the record contains the Findings of Fact, Conclusions of Law, Recommendation of the referee, and a transcript of the proceedings.
To demonstrate the error which in my opinion is plain error rendering the judgment contrary to law on its face, as appears from both the findings, conclusions and judgment appealed from, it is necessary to set forth said Findings of Fact, Conclusions of Law and Recommendation of the referee, which read as follows:
 "FINDINGS OF FACT:
"1. The Plaintiff, Hobert B. Keatley on December 2, 1966 entered in to a contractual relationship, in writing, for the rental of a safe deposit box, known as S-33 with The Canton National Bank, Main Office, Canton, Ohio, n.k.a. the United National Bank  Trust Co., * * *.
"2. The Plaintiff, Ronald H. Keatley, in the name of ABC Venetian Blind Co., on March 20, 1967 entered into a contractual relationship, in writing, for the rental of a safe deposit box, known as S-59 with The Canton National Bank, Main Office, Canton, Ohio, n.k.a. the United National Bank  Trust Co. * * *.
"3. The Plaintiff, Ronald H. Keatley, on December 1, 1970 borrowed $2,500.00 from the United National Bank  Trust Co., securing the loan with collateral contained in safe deposit box S-59, to-wit: a coin collection * * *.
"4. The Plaintiff, Ronald H. Keatley, on or about December 29, 1972, borrowed $5,049.47 from the United National Bank 
Trust Co., securing it with collateral contained in a safe deposit box, S-59, to-wit: a coin collection * * *.
"5. The Plaintiff, Hobert B. Keatley, made several loans from the United National Bank  Trust Co., in 1973, 1974 and 1976 * * *.
"6. The Plaintiff, Ronald H. Keatley, to secure the loans set forth in paragraphs 3 and 4 hereinabove, by letter, relinquished his key and/or keys to the consumer loan department as agents * * *.
"7. The loans made by both Plaintiffs, either as makers and/or co-makers, herein were secured by Financing Statements *Page 203 
duly filed in the Stark County Recorder's Office in Canton, Ohio, showing the personal property securing the loans, including coin collections, without specifying the location of the coin collections * * *.
"8. The evidence established by bank records was that the only box which had a `Caution' and/or notice on its paper work was that rented by ABC Venetian Blind Co., (Ronald H. Keatley), as authorized by letter of December 1, 1970 from Ronald H. Keatley * * *.
"9. The bank records established that the only safe deposit box that was entered was S-59, the property of Ronald H. Keatley, and that S-33, the property of Hobert B. Keatley, was never entered except by the Plaintiff himself * * *.
"10. The evidence established that there was never an inventory of the items in either S-33 or S-59 safe deposit boxes prior to any loans being made to the Plaintiffs and that after a loan was made, only a partial inventory was made of one of the boxes and/or both boxes.
 "CONCLUSIONS OF LAW
"1. The lease of the safety deposit boxes by the Plaintiffs herein created a lessor-lessee relationship and not a bailment situation. The rules of contract law govern the interpretation of this relationship, and not the law of bailment. * * * The lease agreement, having been in writing, makes the contract an express contract between the parties, both executory and an express conveyance. The parties are therefore bound by its terminology which provides, in paragraph 3, that `. . . unauthorized access shall not be inferred from the loss or destruction of any property located or thought to be located in the leased space, nor shall the landlord be liable for the wrongful acts of any person having right to access hereunder.' And paragraph 4 of the lease provides that `. . . it is agreed that possession and control of the property deposited in the leased space is vested exclusively in the tenant and the persons having access thereto, and the landlord shall not become a bailee of any of the property located in the leased space.'
"2. The pledging of the keys to the safe deposit box with the consumer loan department of the same bank in which the safe deposit boxes are located does not create a bailment, but rather an agency between the Plaintiffs and the Defendant *Page 204 
bank. The Plaintiffs must show that the agent bank was negligent and the mere allegations that there was a loss, which is unexplained, does not create any liability. See Hauck v. FirstNational Bank, 55 N.E.2d 565.
"3. The Plaintiff[s] herein having the burden of proof in this case, and having failed to go forward with the evidence by proving the contents of the safe deposit boxes; the value of the contents of the safe deposit boxes; and the negligence of the defendant bank in this matter.
"IT IS THEREFORE RECOMMENDED:
"That judgment be awarded to the Defendant, United National Bank  Trust Co., at Plaintiffs' costs.
[Signed by the referee]
 "NOTICE
"A copy of the foregoing `Findings of Fact; Conclusions of Law; and Recommendation to the Judge', was mailed to George M. Davidson, Jr., and Harry W. Schmuck, Attorneys for the Plaintiff, 401 Central Trust Tower, Canton, Ohio 44702, and Amerman, Burt  Jones Co., L.P.A., Attorneys for Defendant, 250 Peoples-Merchants Trust Building, Canton, Ohio 44702, this 27th day of June, 1979.
[Signed by the referee]"
The court's judgment entry reads as follows:
                             "JUDGMENT ENTRY
"The Complaint of Plaintiffs Hobert B. Keatley and Ronald Keatley against Defendant United National Bank  Trust Co. came on for hearing before * * * [the] Referee appointed by the Court, with agreement of all parties.
"On June 28, 1979, [the] Referee * * * filed with the Court his findings of facts; conclusions of law; and recommendation to the judge. The Court finds those findings and conclusions to be well taken, and judgment is hereby awarded to Defendant United National Bank  Trust Co., with costs being taxed to the Plaintiffs. Such Findings of Fact, Conclusions of Law, Recommendations to the Judge are attached hereto and made a part of this entry.
[Signed by the Judge and
filed with the Clerk]" *Page 205 
With respect to the objections to the referee's report, Civ. R. 53(E)(2) reads:
"A party may, within fourteen days of the filing of the report, serve and file written objections to the referee's report. Such objections shall be considered a motion. Objections shall be specific and state with particularity the grounds therefor. Upon consideration of the objections the court may: adopt, reject or modify the report; hear additional evidence; return the report to the referee with instructions; or hear the matter itself." (Emphasis added.)
I do not interpret this rule which provides that an objectionmay be filed to have the encompassing effect given to it by the majority opinion in this case.
As to plaintiff Ronald H. Keatley, the referee's Findings of Fact, supra, as adopted by the court in the judgment entry, discloses that on March 20, 1967, Ronald H. Keatley entered into a contractual relationship, in writing, with the United National Bank and Trust Company for the rental of a safe deposit box known as "S-59" which created a lessor-lessee relationship as of that time and that thereafter Ronald H. Keatley on December 1, 1970 borrowed $2,500 from the bank, securing the loan with collateral contained in safe deposit box S-59, to wit, a coin collection; in concurrence with which, the letter which reads as follows was delivered to the bank:
"For the purpose of obtaining a loan in the amount of $2,500.00 from The Canton National Bank for a period of 24 months, I hereby pledge U.S. Coins and Currency (Collectors Items) in the face amount of $3,200.00 as security.
"The Coins and Currency are to be kept in the Safe Deposit Department, Safe #59, and the keys to the compartment will be retained by the Consumer Credit Department of the bank until the loan is paid in full.
"I hereby waive any right to access to the compartment for the duration of the loan; however, the contents described above shall be released to me by the bank when the loan is paid off."
Further, the referee's Findings of Fact indicates that plaintiff Ronald H. Keatley, on or about December 29, 1972, borrowed $5,049.47 from the United National Bank and Trust Company, securing the loan with collateral contained in Safe Deposit Box S-59, to wit, a coin collection; in concurrence with *Page 206 
which, the letter which reads as follows was delivered to the bank:
"For the purpose of obtaining a loan in the amount of $5,049.47, from the United National Bank  Trust Company for a period of 18 months, I hereby pledge U.S. Coins and Currency (Collectors Items) in approximately the face amount of $3,200.00, as security.
"The Coins and Currency are to be kept in the Safe Deposit Department, Safe #59, and the keys to the compartment will be retained by the Consumer Credit Department of the bank until the loan is paid in full.
"I hereby waive any right of access to the compartment for the duration of the loan; however, the contents described above shall be released to me by the bank when the loan is paid off."
The referee further made a finding, adopted by the court, that plaintiff Ronald H. Keatley, to secure said loans heretofore set forth, relinquished his keys to the bank's Consumer Credit Department, as his agents.
In the Conclusions of Law found by the referee and adopted and included by the court in the judgment entry, it was adjudged that a lease of the safe deposit box by plaintiff Ronald H. Keatley created a lessor-lessee relationship and not a bailment situation, that the requirements of contract law govern the interpretation of this relationship and not the law of bailments, and that by the lease agreement, entered into between the parties when the boxes were originally leased, the parties thereto became bound by its terminology which provides in paragraph No. 3 that:
"* * * unauthorized access shall not be inferred from the loss or destruction of any property located or thought to be located in the leased space, nor shall the landlord be liable for the wrongful acts of any person having right to access hereunder."
In addition, paragraph No. 4 of the lease agreement provides that:
"* * * it is agreed that possession and control of the property deposited in the leased space is vested exclusively in the tenant and the persons having access thereto, and the landlord shall not become a bailee of any of the property located in the leased space." *Page 207 
Further, the referee found that the pledge of the keys to the safe deposit box with the Consumer Credit Department of the same bank in which the safe deposit boxes were located did not create a bailment but an agency between plaintiffs and defendant bank, requiring plaintiffs to show that the agent bank was negligent — the mere allegations that there was an unexplained loss, not creating liability; wherefore, judgment was rendered in favor of defendant bank.
In my opinion the turning over of the keys by plaintiff Ronald H. Keatley and the waiver of any right of access to the safe deposit box for the duration of the loan, with the contents as security, created a bailment, rendering the provisions of paragraph Nos. 3 and 4 of the original lease agreement,supra, inapplicable to the newly created bailment with the bank, as bailee, taking exclusive control of safe deposit box S-59 and the collateral therein.
The transcript discloses that when plaintiff Ronald H. Keatley and an officer of the bank sought entrance to the box, the keys necessary to open the box, all of which had been in possession of the bank, could not be located in the location where keys were normally kept, but were allegedly found in the drawer of the desk of a discharged employee. The record also contains evidence that when box S-59 was opened, the face value of the collection remaining in the box was less than the face amount of that pledged as security.
As to plaintiff Ronald H. Keatley, in my opinion, the assigned error that the trial court erred, in the Conclusions of Law, in failing to conclude that the relationship between the parties was a bailment is well taken. I find the Findings of Fact and Conclusions of Law contained in the report of the referee, which the court adopted and made a part of the judgment entry, that only an agency relationship, rather than a bailment had been created, is contrary to law.
However, the record further discloses that a small balance is still owed on the loans; in the absence of payment, the bank is not obligated to release the collateral pledged as security. Thus, no cause of action by plaintiff Ronald H. Keatley, as bailor, against the United National Bank and Trust Company has accrued; for which reason, the entry of a judgment, which might be considered res judicata to such action when it does accrue, would be prejudicial. *Page 208 
Therefore, a judgment ought to be entered dismissing the action of plaintiff Ronald H. Keatley against the United National Bank and Trust Company, without prejudice to the filing of an action by Ronald H. Keatley against the bank if such cause of action accrues upon payment of the loan in full.
However, I concur in the affirmance of the portion of the judgment rendered in favor of the United National Bank and Trust Company against plaintiff Hobart B. Keatley because the referee's Findings of Fact, to which no objection was made in the Court of Common Pleas, do not indicate that a bailment situation was created as to safe deposit box S-33, which was leased by plaintiff Hobart B. Keatley. Further, I support the Conclusions of Law and the judgment, rendered against plaintiff Hobart B. Keatley, which, upon those findings and conclusions, is not contrary to law.
I am aware of the fact that a Court of Appeals in the exercise of its discretionary power ought not, generally, to consider matters not called to the attention of the trial court; but, I do not read Civ. R. 53(E) to preclude exercise of discretionary power in the instant case because no objection was made to errors, which, in my opinion, as to plaintiff Ronald H. Keatley, appear on the face of the report, and which errors of commission, I feel, to be of such magnitude, that justice requires they be given consideration.
For the reasons set forth I concur in the affirmance of the portion of the judgment rendered in favor of the United National Bank and Trust Company against plaintiff Hobart B. Keatley, but dissent from the affirmance of the portion of the judgment rendered in favor of the United National Bank and Trust Company against plaintiff Ronald H. Keatley. *Page 209