Normandy Place Associates v. Beyer , 2 Ohio St. 3d 102 ( 1982 )

Clifford F. Brown, J.

The issue presented herein is whether the filing of a Civ. R. 53(E) objection to a referee’s report is a prerequisite for appellate review of a finding or recommendation made by a referee and adopted by a trial court. For the following reasons we hold that it is not.

Appellants contend that appellee’s failure to specifically object to certain language contained in the referee’s report precludes review of that question at the appellate level. Such an argument is predicated on the well-established rule regarding the preservation of a claim of error:

“Ordinarily, errors which arise during the course of a trial, which are not brought to the attention of the court by objection or otherwise, are waived and may not be raised upon appeal.” Stores Realty Co. v. Cleveland (1975), 41 Ohio St. 2d 41, 43 [70 O.O.2d 123]. See, also, State v. Glaros (1960), 170 Ohio St. 471 [11 O.O.2d 215], paragraph one of the syllabus.

This general principle, however, must be read in conjunction with Civ. R. 53(E)(2), which sets forth the procedure to be followed when a party elects to file objections to a referee’s report. It states as follows:

“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.)

Clearly, this rule does not mandate the filing of objections to a referee’s report. Had the drafters of the Civil Rules intended that the failure to file objections would preclude appellate review, they could easily have stated so explicitly. Instead, they chose to employ the word “may,” which has traditionally been interpreted as merely conferring a right or privilege on a party rather than imposing on him an obligation to act. In view of the permissive construction customarily afforded the word “may” and in the absence of a clear warning of the consequences entailed in the failure to file objections, this court is reluctant to deprive a party of such a substantial right as the right of appeal.

Our determination in this matter is further prompted by the high regard in which we hold the function of the judiciary. It is the primary duty of the court, and not the referee, to act as a judicial officer. Indeed, the court must approve the referee’s report and enter it upon its own record in order for that report to have any validity or binding effect. Civ. R. 53(E)(5). As was stated in the 1970 Staff Note to Civ. R. 53:

“* * * Rule 53 contemplates that a referee shall aid the court in the expedition of the court’s business and not be a substitute for the functions of the court.” (Emphasis added.)

In order for the trial court to maintain its independence, it is of utmost importance that it carefully examine any report before it for errors. Accordingly, we reject any concept which would suggest that a trial court may in any way abdicate its function as judge over its own acts. We therefore hold that,.even in the absence of an objection to a referee’s report, the trial court has the responsibility to critically review and verify to its own satisfaction the correctness of such a report.

Although we agree with the court of appeals’ resolution of the question certified for review, we find error in the manner in which that court determined the rights of the parties under the contract, under App. R. 12(B), “as a • matter of law.”¹

The substantive issue in the present case centered around the referee’s finding that “[u]nder Ohio law, an agreement to make an agreement in the future is not an enforceable contract.” This is clearly an erroneous statement.

As correctly noted by the court of appeals, Ohio has long recognized the general validity of preliminary agreements to lease. See Rhodes v. Baird (1866), 16 Ohio St. 573; Kirkland v. Wolf (1878), 7 Dec. Rep. 436. It is thus not the law that an agreement to make an agreement is per se unenforceable. The enforceability of such an agreement depends rather on whether the parties have manifested an intention to be bound by its terms and whether these intentions are sufficiently definite to be specifically enforced. See, generally, Restatement of Contracts 2d 75, Section 26; 1 Corbin on Contracts 97, Section 30.

The referee in the case at bar precluded resolution of these issues when he concluded that all agreements to lease are per se unenforceable. The fact that the referee misstated the prevailing law, however, did not entitle appellee “to have judgment or final order rendered in [its] favor as a matter of law” within the meaning of App. R. 12(B).² Whether the parties intended a contract remains a factual question, not a legal one, and as such is an issue to be resolved by the finder of fact. Arnold Palmer Golf Co. v. Fuqua Industries, Inc. (C.A. 6, 1976), 541 F. 2d 584, 588. App. R. 12(B) does not authorize a reviewing court to reverse the decision of a trial court and enter final judgment under these circumstances.

Because the issue of the parties’ intent to be bound is a proper one for resolution by the trier of fact, we reverse that part of the judgment of the court of appeals which determined the rights of the parties under the contract. Accordingly, we remand this cause to the trial court for further proceedings consistent with this opinion.

Judgment affirmed in part, reversed in part, and cause remanded.

Celebrezze, C.J., Sweeney and Holmes, JJ., concur. W. Brown, J., concurs in paragraphs one and two of the syllabus and in the judgment. Locher and Krupansky, JJ., dissent.

1 The court of appeals did not find that the trial court’s decision was against the manifest weight of the evidence, but that the lower court applied the wrong law in reaching its conclusion. Acting presumably under App. R. 12(B), the court then proceeded to weigh the evidence in the record and determine the rights of the parties under the contract.

2 App. R. 12(B) provides in pertinent part:

“* * * When the court of appeals determines that the trial court committed error prejudicial to the appellant and that the appellant is entitled to have judgment or final order rendered in his favor as a matter of law, the court of appeals shall reverse the judgment or final order of the trial court and render the judgment or final order that the trial court should have rendered, or remand the cause to the court with instructions to render such judgment or final order. * * *” (Emphasis added.)