Moyer v. Abbey Credit Union, Inc. , 2020 Ohio 5410 ( 2020 )

[Cite as Moyer v. Abbey Credit Union, Inc., 2020-Ohio-5410.]
IN THE COURT OF APPEALS OF OHIO
SECOND APPELLATE DISTRICT
MONTGOMERY COUNTY
JUDA MOYER :
:
Plaintiff-Appellee : Appellate Case No. 28759
:
v. : Trial Court Case No. 2019-MSC-127
:
ABBEY CREDIT UNION, INC. : (Appeal from Probate Court)
:
Defendant-Appellant :
:
...........
OPINION
Rendered on the 25th day of November, 2020.
...........
R. MICHAEL OSBORN, Atty. Reg. No. 0065347, 33 West First Street, Suite 600, Dayton,
Ohio 45402
Attorney for Plaintiff-Appellee
STEPHEN D. MILES, Atty. Reg. No. 0003716 and VINCENT A. LEWIS, Atty. Reg. No.
0071419, 18 West Monument Avenue, Dayton, Ohio 45402
Attorneys for Defendant-Appellant
.............
WELBAUM, J.
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{¶ 1} Defendant-Appellant, Abbey Credit Union, Inc., (“Abbey”) appeals from a
judgment on the pleadings rendered in favor of Plaintiff-Appellee, Juda Moyer, executor
of the Estate of Shirlee A. Garringer (“Moyer”). According to Abbey, the probate court
erred in granting judgment on the pleadings because such a disposition was not permitted
under Civ.R. 12(C). Abbey further contends that it was entitled to use the self-help right
of setoff against an estate account upon discovering that it had mistakenly transferred
funds to the estate, when the estate was not entitled to the funds. Abbey also contends
that Moyer failed to sustain any damages and was not entitled to the money that was
deposited into the estate account.
{¶ 2} We conclude that the probate court erred in rendering judgment on the
pleadings because the damages were not supported by any evidence. Although Abbey
incorrectly exercised the right of setoff, Moyer was not legally entitled to the money.
Moyer, therefore, had to establish that she detrimentally relied on Abbey’s actions and
that damages resulted. Since no proof was presented on these points, the probate court
had no basis for awarding Moyer the entire amount of money that had been mistakenly
transmitted. Accordingly, the judgment of the probate court will be affirmed in part and
reversed in part, and this cause will be remanded for further proceedings concerning
damages.
I. Facts and Course of Proceedings
{¶ 3} This case arose from Abbey’s mistaken payment of funds in a decedent’s
account to the executor of the decedent’s estate. Specifically, the decedent’s account
designated a payable on death (“POD”) beneficiary to whom the funds should have been
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paid, rather than being paid to the executor.
{¶ 4} According to the facts in the complaint (which Abbey mostly admitted),1 the
decedent, Shirlee Garringer, owned a share savings account with Abbey at the time of
her death. On June 25, 2018, an attorney representing Juda Moyer (Garringer’s
executor) sent Abbey a letter, requesting date of death balance for Garringer’s account,
as well as the “ ‘name of the beneficiary [listed on the account] if applicable.’ ” Complaint
at ¶ 6.
{¶ 5} On June 29, 2018, Abbey responded, stating that it had closed Garringer’s
account on June 6, 2018, and had issued a check payable to the Estate of Shirlee A.
Garringer. Subsequently, Moyer, as executor, opened a checking and savings accounts
for the estate at an Abbey branch location on July 2, 2018; at that time, Moyer deposited
Abbey’s cashier’s check in the amount of $26,239.97 into the estate’s accounts. This
check was the same one that Abbey had issued to the estate. When the check was
deposited, Moyer told Abbey to deposit $10,000 into the estate’s checking account, and
the rest into the estate’s savings account. Id. at ¶ 6-10.
{¶ 6} After the money was deposited, Moyer began administering the estate’s
financial affairs, including depositing funds received from other banks. She also began
writing checks to pay estate expenses. At some point after the cashier’s check was
initially deposited, Abbey discovered that Garringer’s account contained a POD
designation. As a result, Abbey executed a “transfer” or “charge back” of $26,239.97
from the estate’s checking and savings accounts. Id. at ¶ 11-13.
1The only fact not admitted was the date of Garringer’s death, which was alleged to have
occurred on May 23, 2018. See Complaint at ¶ 4, and Answer at ¶ 2.
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{¶ 7} On December 7, 2018, Moyer’s attorney sent Abbey a demand letter
requesting that Abbey return the funds it had debited. However, Abbey did not return
the funds. Id. at ¶ 14-17. As a result, Moyer filed a complaint in the Montgomery County
probate court in April 2019, seeking relief on four grounds: breach of contract, conversion,
failure to exercise ordinary care under R.C. 1304.03, and failure to comply with R.C.
2117.06. Abbey filed an answer on May 5, 2019, denying liability and asserting
affirmative defenses.
{¶ 8} On August 7, 2019, Moyer moved for judgment on the pleadings, and Abbey
filed a response. In addition, Abbey filed a motion seeking leave to amend its answer to
allege the affirmative defenses of extrajudicial setoff and self-help. The probate court
granted Abbey’s motion to amend on October 29, 2019. The following day, the court
granted Moyer’s motion for judgment on the pleadings. Abbey then filed a timely notice
of appeal from the judgment, which was docketed as Montgomery App. No. 28620.
{¶ 9} In January 2020, we issued a show cause order which asked the parties to
explain why the appeal should not be dismissed for lack of a final appealable order. We
then dismissed the appeal on that basis, because the probate court’s judgment had not
addressed the issue of damages. See Moyer v. Abbey Credit Union, 2d Dist.
Montgomery No. 28620, p. 2 (Decision and Final Judgment Entry, Feb. 13, 2020).
{¶ 10} After the appeal was dismissed, the probate court filed an entry and order
on February 24, 2020, ordering Abbey to deposit and/or return the sum of $26,239.97
(the amount of the cashier’s check made payable to the Estate of Shirlee Garringer) into
the estate’s checking and/or savings accounts at Abbey Credit Union within 30 days.
Abbey then appealed from both judgments on March 19, 2020.
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II. The Motion for Judgment on the Pleadings
{¶ 11} Abbey’s sole assignment of error states that:
The Trial Court Erred in Granting the Plaintiff’s Motion for Judgment
on the Pleadings.
{¶ 12} Abbey raises several issues under this assignment of error. For purposes
of clarity, we will discuss the issues separately, beginning first with the procedural posture
of the case.
A. Was the Probate Court’s Procedure Appropriate?
{¶ 13} Abbey’s first argument is that the probate court should not have decided
this matter based on the pleadings because Civ.R. 12(C) motions are to be used
offensively, not defensively. In response, Moyer argues that Abbey failed to raise this
point below. Moyer further notes that Civ.R. 12(C) allows “any party” to move for
judgment on the pleadings, not just defendants.
{¶ 14} As an initial point, we agree that Abbey failed to challenge the process used
by the probate court. In responding to Moyer’s Civ.R.12(C) motion, Abbey did note that
Civ.R.12(C) is typically invoked by defendants. Memorandum Opposing Plaintiff’s
Motion for Judgment on the Pleadings (“Memo Opposing Judgment on the Pleadings”),
p. 4. However, Abbey did not object to having the court consider the merits of the case;
instead, Abbey argued that the standard (of construing the facts most favorably to the
nonmovant) “cuts the other way” when the plaintiff is the movant. Id.
{¶ 15} The parties’ agreement to a particular procedure does not mean that a court
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is correct in following their lead if the parties’ analysis is, in fact, incorrect. Therefore, we
look to Civ.R. 12(C) and caselaw to decide this point. Civ.R. 12(C) provides that “[a]fter
the pleadings are closed but within such time as not to delay the trial, any party may move
for judgment on the pleadings.” Although defendants typically file these motions, that is
not always the case.
{¶ 16} In Portfolio Recovery Assocs., L.L.C. v. VanLeeuwen, 2d Dist. Montgomery
No. 26692, 2016-Ohio-2962, we considered a situation in which the plaintiff, an assignee
of a credit card issuer, brought suit against a defendant and was then granted judgment
on the pleadings. Id. at ¶ 2. In discussing the plaintiff’s motion, we commented that:
“In the determination of a Civ.R. 12(C) motion, the nonmoving party
is entitled to have all of the material allegations in the pleading, with all
reasonable inferences to be drawn therefrom, construed in his favor as
true.” Am. Tax Funding L.L.C. v. Miamisburg, 2d Dist. Montgomery No.
24494, 2011-Ohio-4161, ¶ 31. In the review of a motion for judgment on
the pleadings to dismiss a complaint, the Supreme Court of Ohio has
declared that, “entry of judgment pursuant to Civ.R. 12(C) is only
appropriate ‘where a court (1) construes the material allegations in the
complaint, with all reasonable inferences to be drawn therefrom, in favor of
the nonmoving party as true, and (2) finds beyond doubt, that the plaintiff
could prove no set of facts in support of his claim that would entitle him to
relief.’ “ Hester v. Dwivedi, 89 Ohio St.3d 575, 577-78, 733 N.E.2d 1161(2000), citing State ex rel. Midwest Pride IV, Inc. v. Pontious, 75 Ohio St.3d
565, 570, 664 N.E.2d 931 (1996). This high burden is not lessened when
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a motion for a judgment on the pleadings is filed to obtain judgment, as the
movant must prove, beyond a doubt, the absence of any genuine issue of
fact and that it is entitled to judgment as a matter of law. We have held that
a summary judgment “is to be awarded only with great caution, with all
doubts resolved in favor of the nonmoving party, because it deprives the
nonmoving party of his day in court.” Smith v. Five Rivers MetroParks, 134
Ohio App.3d 754, 764, 732 N.E.2d 422 (2d Dist.1999), citing Norris v. Ohio
Std. Oil Co. 70 Ohio St.2d 1, 2, 433 N.E.2d 615 (1982). The same degree
of caution must be exercised when considering a motion for judgment on
the pleadings.
Id. at ¶ 15.
{¶ 17} As Moyer notes, Civ.R. 12(C) refers to “any” party, not just to plaintiffs.
Thus, while granting a plaintiff’s motion for judgment on the pleadings is somewhat rare,
it is not inappropriate. With that in mind, we will consider the next point that Abbey has
raised.
B. Alleged Right of Setoff
{¶ 18} Abbey’s second argument is that it was entitled to use its right of setoff to
retrieve money from Moyer’s account. The probate court rejected this contention, stating
that no mutuality of obligation or debtor-creditor relationship existed between the bank
and the estate. Entry Granting Plaintiff’s Motion for Judgment on the Pleadings (“Entry”),
p. 8-9.
{¶ 19} We review decisions on motions for judgment on the pleadings de novo,
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because these motions present only questions of law. “De novo review mandates an
independent decision, without deference to a trial court's determination.” Howard v.
HCR ManorCare, Inc., 2018-Ohio-1053, 99 N.E.3d 429, ¶ 23 (2d Dist.).
{¶ 20} “Bank setoff is an extrajudicial self-help remedy based on general principles
of equity. It allows a bank to apply general deposits of a depositor against a depositor's
matured debt. Courts have found that this right arises from the contractual debtor-
creditor relationship created between depositor and bank when an account is opened.”
Daugherty v. Cent. Tr. Co. of Northeastern Ohio, 28 Ohio St.3d 441, 446, 504 N.E.2d
1100 (1986). “Setoff is not strictly limited by statute, and the courts can allow setoff upon
equitable principles where necessary to prevent clear injustice.” Walter v. Natl. City
Bank of Cleveland, 42 Ohio St.2d 524, 330 N.E.2d 425 (1975), paragraph one of the
syllabus.
{¶ 21} “[T]hree conditions must be satisfied before a bank may set off a customer's
deposits against his indebtedness to the bank: (1) the existence of mutuality of obligation,
(2) the debtor's ownership of the funds used for setoff, and (3) the ripeness of the existing
indebtedness for collection at the time of the setoff.” Citizens Fed. Bank, FSB v. Zierolf,
119 Ohio App.3d 46, 49, 694 N.E.2d 496 (2d Dist.1997).
{¶ 22} After considering the law and the record, we agree with the probate court
that mutuality of obligation did not exist here. We explained in Zierolf that “[t]he mutuality
of obligation which must be shown to entitle a bank to a setoff must exist as between the
bank and its customer. As the term implies, the bank must hold funds on behalf of the
customer which it is obligated to pay to the customer, and the customer must be obligated
in some way to the bank, such as through a promissory note.” Id. at 51.
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{¶ 23} In Zierolf, the party to whom setoff was applied was a bank customer who
had signed a $160,000 promissory note to the bank and had defaulted on the note. The
bank then placed a hold on a CD of which the debtor was a co-owner. Id. at 48.
Similarly, in Walter, a bank attempted to set off the amount of a promissory note that its
customer had signed. However, in that case, the court rejected setoff because the loan
had not yet matured. Walter, 42 Ohio St.2d at 527, 330 N.E.2d 425. Likewise, in Kopp
v. Bank One, NA, 11th Dist. Lake No. 2002-L-025, 2003-Ohio-64, a bank set off the
amount of a defaulted car loan that it held against a joint and survivorship account of
which the debtor was a joint owner. Id. at ¶ 2-4.
{¶ 24} In the case before us, there was no such mutuality of obligation. Moyer did
not borrow money from Abbey. Instead, Abbey mistakenly paid money from another
account holder to Moyer. The fact that Moyer later deposited the money at Abbey was
a mere coincidence. Accordingly, setoff did not apply to the situation in the case before
us, and the probate court did not err in rejecting that theory.
B. Charge-Back
{¶ 25} Abbey also argues that the probate court erred in focusing on the issue of
whether Abbey was entitled to take a “charge-back” of the funds in the account.
According to Abbey, it never asserted that it was entitled to a charge-back under R.C.
1304.24(A). Instead, Abbey argues that its claim was one for money paid by mistake.
Abbey also argues that Moyer was not entitled to the money, as it did below. Memo
Opposing Judgment on the Pleadings at p. 4.
{¶ 26} One of the matters the probate court discussed was whether Abbey was
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entitled to revoke or “charge-back” the credits it made to the estate’s account. The court
answered this negatively, concluding that because Abbey paid Moyer by cashier’s check,
this payment, being the equivalent of cash, was final when the check was given to Moyer,
and Abbey was not entitled to a charge-back under R.C. 1304.24(A). Entry at p. 5-6.
{¶ 27} Again, due to the nature of a judgment on the pleadings, we review the
probate court’s decision on a de novo basis, which means that we do not defer to the
lower court’s decision. Howard, 2018-Ohio-1053, 99 N.E.3d 429, at ¶ 23.
{¶ 28} R.C. 1304.24(A) provides that:
If a collecting bank has made provisional settlement with its customer
for an item and fails by reason of dishonor, suspension of payments by a
bank, or otherwise to receive settlement for the item which is or becomes
final, the bank may revoke the settlement given by it, charge back the
amount of any credit given for the item to its customer's account, or obtain
refund from its customer whether or not it is able to return the items if by its
midnight deadline or within a longer reasonable time after it learns the facts
it returns the item or sends notification of the facts. If the return or notice
is delayed beyond the bank's midnight deadline or a longer reasonable time
after it learns the facts, the bank may revoke the settlement, charge back
the credit, or obtain a refund from its customer, but it is liable for any loss
resulting from the delay. These rights to revoke, charge-back, and obtain
refund terminate if and when a settlement for the item received by the bank
is or becomes final.
{¶ 29} The settlement here was made by a cashier’s check on which Abbey was
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both the drawer and drawee. A cashier’s check is defined as “a draft with respect to
which the drawer and drawee are the same bank or branches of the same bank.” R.C.
1303.03(G). See also R.C. 1304.01(C) (which indicates that the definition of a cashier’s
check as used in R.C. 1304.01 to 1304.40 has the same meaning as in R.C. 1303.03).
{¶ 30} Concerning tender of cashier’s checks, R.C. 1304.23(A)(2)(a) states that
the time of settlement is “when the cash or check is sent or delivered.”2 The time of
settlement, therefore, would have been on June 6, 2018, when Abbey closed the
Garringer account and sent or delivered the certified check to Moyer.
{¶ 31} R.C. 1304.23(C) further provides that:
If settlement for an item is made by cashier's check or teller's check,
both of the following apply:
(1) If the person receiving settlement, before its midnight deadline,
presents or forwards the check for collection, settlement is final when the
check is finally paid.
(2) If the person receiving settlement, before its midnight deadline,
fails to present or forward the check for collection, settlement is final at the
midnight deadline of the person receiving settlement.
{¶ 32} And finally, R.C. 1304.25 states that:
(A) An item is finally paid by a payor bank when the bank has done
any of the following:
(1) Paid the item in cash;
2 This provision applies in the absence of prescription by “federal reserve regulations or
circulars, clearing house rules, and similar rules and documents, or agreement.” R.C.
1304.02(A). No evidence was presented to indicate that these prescriptions existed.
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(2) Settled for the item without having a right to revoke the settlement
under statute, clearing house rule, or agreement;
(3) Made a provisional settlement for the item and failed to revoke
the settlement in the time and manner permitted by statute, clearing house
rule, or agreement.
{¶ 33} Again, the parties did not provide information below concerning whether any
clearing house rules or agreements applied. However, reading the above statutes
together, payment would have been final at the time of Abbey’s midnight deadline for July
2, 2018, which is when the estate’s accounts were opened and the cashier’s check was
deposited and was accepted by Abbey. The revocation of settlement did not occur until
September 9, when Abbey debited the amount of the cashier’s check from Moyer’s
account. Therefore, if R.C. 1304.24(A) had been the basis for debiting the account,
Abbey’s right to terminate ended when the payment was final.
{¶ 34} As noted, Abbey contends that R.C. 1304.24(A) does not apply because its
claim was for “money paid in mistake,” and was not for a “bounced check” as
contemplated by R.C. 1304.24(A). In support of this argument, Abbey cites Soc. Bank,
NA v. Kuntz, 2d Dist. Montgomery No. 12637, 1991 WL 213874 (Sept. 17, 1991). In
Kuntz, we held that a bank was entitled to a constructive trust over a customer’s account
where the customer had been unlawfully and unjustly enriched by the bank’s mistake.
Id. at *3, citing R.C. 1303.28(A) and (B).
{¶ 35} As a preliminary point, it is not completely clear that R.C. 1304.24(A) applies
only to “bounced checks.” The statute references situations in which “a collecting bank
has made provisional settlement with its customer for an item and fails by reason of
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dishonor, suspension of payments by a bank, or otherwise to receive settlement * * *.”
(Emphasis added.) The statute does not define what “otherwise” means, and the
situation here conceivably could have arisen under the statute, although it appears to
apply primarily to situations in which a check is dishonored or refused after being
presented for collection.
{¶ 36} We do agree that Abbey did not rely on R.C. 1304.24(A) in the probate
court. This was an argument that Moyer raised and that the probate court used to
conclude that Abbey did not have a statutory right under R.C. 1304.24(A) to “charge-
back” the account.
{¶ 37} Concerning the application of a constructive trust and R.C. 1303.28, this
statute was repealed in 1994 and was amended and recodified as R.C. 1303.23. See
Amendment Note to R.C. 1303.23. After recodification, the statute no longer mentions
“constructive trust.” Furthermore, unlike the bank in Kuntz, Abbey elected to use self-
help rather than to place a hold on the funds and file suit, or simply file suit against Moyer.
Specifically, after making mistakes in paying a check presented by an unauthorized party,
the bank in Kuntz paid the wronged party and filed suit against the party it had mistakenly
paid. Id. at *1.
{¶ 38} Nonetheless, whether or not R.C. 1304.24(A) applies is essentially
irrelevant, because the probate court failed to consider R.C. 1304.24(E), which states that
“[a] failure to charge-back or claim refund does not affect other rights of the bank against
the customer or any other party.” R.C. 1301.103(B) also provides that “[u]nless
displaced by the particular provisions of Chapters 1301., 1302., 1303., 1304., 1305.,
1307., 1308., 1309. , and 1310. of the Revised Code, the principles of law and equity,
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including the law merchant and the law relative to capacity to contract, principal and
agent, estoppel, fraud, misrepresentation, duress, coercion, mistake, bankruptcy, and
other validating or invalidating cause supplement their provisions.” (Emphasis added.)
{¶ 39} The Ohio Supreme Court has stressed that “ ‘the general assembly will not
be presumed to have intended to abrogate a settled rule of the common law unless the
language used in a statute clearly supports such intention.’ ” Mandelbaum v.
Mandelbaum, 121 Ohio St.3d 433, 2009-Ohio-1222, 905 N.E.2d 172, ¶ 29, quoting State
ex rel. Hunt v. Fronizer, 77 Ohio St. 7, 16, 82 N.E. 518 (1907). Accord Cheatham I.R.A.
v. Huntington Natl. Bank, 157 Ohio St.3d 358, 2019-Ohio-3342, 137 N.E.3d 45, ¶ 21.
{¶ 40} Thus, even if Abbey was not entitled to remove the funds based on setoff
or charge-back, that does not mean that common law principles cannot apply here.
Before the probate court’s decision was issued, Abbey amended its answer to include
affirmative defenses, including the fact that the estate had no right to the funds and that
a lack of consideration existed. In addition, Abbey previously had raised the issue of
mistake, citing Firestone Tire & Rubber Co. v. Cent. Nat. Bank of Cleveland, 159 Ohio St.
423, 112 N.E.2d 636 (1953). Memo Opposing Judgment on the Pleadings at p. 2. And,
as noted, Abbey further raised the fact that Moyer could not claim damages, as the estate
was never entitled to the money.
{¶ 41} In the case before us, Moyer's complaint was based on breach of contract,
conversion, failure to exercise ordinary care under R.C. 1304.03, and failure to comply
with R.C. 2117.06. In its original decision, the probate court did not indicate the ground
on which its judgment was issued; the court primarily discussed the remedies of setoff
and charge-back and concluded that Abbey was not entitled to use these remedies to
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deduct the money from Moyer’s accounts. While this may be true, the issue of damages
for Abbey’s acts must be considered. However, the probate court did not specifically
address the damages issue. Instead, after we remanded the case for lack of a final
appealable order, the court simply ordered Abbey to pay Moyer the entire amount of the
claim, without any discussion at all.
{¶ 42} “In a breach of contract claim, the plaintiff must prove the existence of a
contract, the plaintiff's performance under the contract, the defendant's breach, and
damages.” Meeker R & D, Inc. v. Evenflo Co., 2016-Ohio-2688, 52 N.E.3d 1207, ¶ 41
(11th Dist.), citing Doner v. Snapp, 98 Ohio App.3d 597, 600, 649 N.E.2d 42 (2d
Dist.1994). There is no question that a contractual relationship existed here by virtue of
the fact that Moyer opened up checking and savings accounts with Abbey. However, no
contract terms were provided to the probate court, and as indicated, the court did not give
any reasons for its decision on damages.
{¶ 43} “To recover on a breach-of-contract claim, the claimant must prove not only
that the contract was breached, but that the claimant was thereby damaged.”
Metropolitan Life Ins. Co. v. Triskett Illinois, Inc., 97 Ohio App.3d 228, 235, 646 N.E.2d
528 (1st Dist.1994). Accord Daniel v. Walder, 2d Dist. Montgomery No. 27558, 2017-
Ohio-8914, ¶ 13. “ ‘As a general rule, an injured party cannot recover damages for
breach of contract beyond the amount that is established by the evidence with reasonable
certainty, and generally, courts have required greater certainty in the proof of damages
for breach of contract than in tort.’ ” Walder at ¶ 13, quoting Rhodes v. Rhodes
Industries, Inc., 71 Ohio App.3d 797, 808-809, 595 N.E.2d 441 (8th Dist.1991). “ ‘The
normal remedy for a breach of contract claim is to give the injured party such relief as will
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put him in as good a position as if the contract had been performed.’ ” Id., quoting Tucker
v. Young, 4th Dist. Highland No. 04CA10, 2006-Ohio-1126, ¶ 30.
{¶ 44} In the case before us, there is no dispute about the fact that Moyer was not
legally entitled to the funds either when Abbey gave Moyer the check or when Moyer
deposited the check in the bank. Consequently, it is difficult to see what, if any, damages
Moyer sustained as a result of the breach.
{¶ 45} In Firestone, the Supreme Court of Ohio held that “[m]oney paid to another
under the mistaken supposition of the existence of a specific fact which would entitle the
other to the money, which money would not have been paid had it been known to the
payer that the fact did not exist, may be recovered, provided the payment does not result
in such a change in the position of the payee that it would be unjust to require a refund.”
Firestone, 159 Ohio St. 423, 112 N.E.2d 636, paragraph four of the syllabus. The
ultimate summary of these principles, according to the court, is that “[a] payer, even if
negligent in making payment under a mistake of fact, may recover if his act has not
resulted in a change in the position of the innocent payee to his detriment.” Id. at 439.
{¶ 46} Consistent with Firestone, Moyer alleged in the complaint that she had
“detrimentally relied” on the funds to pay estate expenses. Complaint at ¶ 22.
However, beyond this minimal statement in the pleadings, no evidence was ever offered
to show what expenses were paid and why those expenses could not have been paid
with the other funds deposited with the estate. For example, the probate court noted that
Moyer had deposited funds from other institutions into the estate’s account, including
$23,623.67 that was received from Garringer’s account with Wright-Patt Credit Union.
Entry at p. 2. Because this figure was never mentioned in the pleadings (to which the
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court was restricted), we assume the court obtained the figure from documents that were
filed in the probate case involving Garringer’s estate. See Estate of Shirlee A. Garringer,
Montgomery P.C. No. 2018EST01173.3
{¶ 47} Even if the court were permitted to consider the probate court record, it
appears there were no damages. The inventory filed in that case on August 9, 2018,
indicated a $50,706.13 value for the estate. Therefore, the estate had that amount in
assets at the time. The first and partial inventory, covering the period from June 18, 2018
through March 20, 2020, was filed on March 20, 2020. According to the inventory, Abbey
took back its funds on September 9, 2018. Between July 18, 2018 and September 9,
2018, the estate paid only about $5,963 for expenses that it had incurred. Given the
estate’s value, it is hard to imagine how Moyer detrimentally relied on Abbey’s funds
before they were taken back.
{¶ 48} As an example of a situation in which a party was mistakenly paid and
suffered detriment that prevented the payor from obtaining a full recovery of the money,
see WesBanco Bank, Inc. v. Smoked Ribs, Inc., 2016-Ohio-177, 45 N.E.3d 1066, (4th
Dist.). In that case, a bank employee had mistakenly used an incorrect key to code in
American Express transactions at a Comfort Inn. As a result, a restaurant (Smoked
Ribs, Inc.) was paid instead of the hotel, resulting in an overpayment of about $239,000
to Smoked Ribs. Id. at ¶ 4-5. Consistent with Firestone, the bank was allowed to
3 Although the pleadings in the estate case are not part of the current record, courts “may
take judicial notice of judicial opinions and public records accessible through the Internet.”
State v. Bevers, 2d Dist. Montgomery No. 27651, 2018-Ohio-4135, ¶ 13. The probate
records for the Montgomery County Probate Court are accessible over the Internet, and
only one estate in the court’s online records involves Shirlee Garringer’s estate.
However, here, while ruling on the Civ.R. 12(C) motion, the probate court was restricted
to the pleadings.
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recover the overpayments. However, the recovery was limited because Smoked Ribs
was able to prove that it detrimentally relied on the money it had received by using some
of it for property improvements that it otherwise would not have made. Furthermore, the
restaurant made the improvements before receiving notice of the overpayments. Id. at
¶ 48-49.
{¶ 49} Here, Moyer had notice on September 9, 2018, that a dispute existed
concerning the funds. Any actions that Moyer took after that date could not possibly
have been the result of detrimental reliance. Moreover, as we said, Moyer failed to
submit any proof with respect to her alleged detrimental reliance or payments that were
made as a result of her reliance. Although Moyer was not required to include these
matters in the pleadings, granting judgment on the pleadings as to damages was not
appropriate, given this deficiency.
{¶ 50} The remaining claims that Moyer asserted do not provide any basis for
damages. As to conversion, it is “an exercise of dominion or control wrongfully exerted
over property in denial of or under a claim inconsistent with the rights of another.” Dice
v. White Family Cos., 173 Ohio App.3d 472, 2007-Ohio-5755, 878 N.E.2d 1105, ¶ 17 (2d
Dist.). The elements of an action for conversion are: “ ‘(1) plaintiff's ownership or right to
possession of the property at the time of the conversion; (2) defendant's conversion by a
wrongful act or disposition of plaintiff's property rights; and (3) damages.’ ” Id., quoting
Haul Transport of VA, Inc. v. Morgan, 2d Dist. Montgomery No. 14859, 1995 WL 328995(June 2, 1995).
{¶ 51} “The general rule for the measure of damages in a conversion claim is the
value of the property at the time of the conversion.” Windward Ents., Inc. v. Valley City
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Dev. Group LLC, 2019-Ohio-3419, 142 N.E.3d 177, ¶ 16 (9th Dist.). However, in tort
actions, “the measure of damages is that which will compensate and make the plaintiff
whole.” Robinson v. Bates, 112 Ohio St.3d 17, 2006-Ohio-6362, 857 N.E.2d 1195, ¶ 11.
Again, because Moyer was not entitled to the money that was erroneously deposited,
there was no need to make her “whole.”
{¶ 52} More importantly, in Ohio, “[t]he economic-loss rule generally prevents
recovery in tort of damages for purely economic loss.” Corporex Dev. & Constr. Mgt.,
Inc. v. Shook, Inc., 106 Ohio St.3d 412, 2005-Ohio-5409, 835 N.E.2d 701, ¶ 6. “This rule
stems from the recognition of a balance between tort law, designed to redress losses
suffered by breach of a duty imposed by law to protect societal interests, and contract
law, which holds that ‘parties to a commercial transaction should remain free to govern
their own affairs.’ ” Id., quoting Chemtrol Adhesives, Inc. v. Am. Mfrs. Mut. Ins. Co., 42
Ohio St.3d 40, 42, 537 N.E.2d 624 (1989).
{¶ 53} There was no indication here that Moyer suffered anything other than
alleged economic loss – which as we noted, she does not appear to have had. The
economic loss restriction also disposes of any potential tort claim for breach of ordinary
care under R.C. 1304.03, even if that statute applied.
{¶ 54} Finally, concerning R.C. 2117.06, which applies to claims of creditors of an
estate and time limits for filing claims, the probate court concluded that Abbey was not
acting as a creditor of the estate. Entry at p. 8. We agree. As a result, this statute
was inapplicable.
{¶ 55} In summary, while Abbey was not justified in debiting Moyer’s account,
Moyer failed to present proof of damages that she sustained as a result. As a result, the
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probate court erred in granting judgment on the pleadings with respect to damages, which
were required to be proven. Although the outcome of the damages assessment appears
clear, the procedural disposition of the case prevented the presentation of any evidence
on this point. Accordingly, the case must be reversed and remanded in order to allow
the parties to present evidence as to the damages, if any, to be awarded. Abbey’s sole
assignment of error, therefore, is sustained in part and is overruled in part.
III. Conclusion
{¶ 56} Abbey’s assignment of error having been sustained in part and overruled in
part, the judgment of the probate court is affirmed in part and reversed in part, and this
cause is remanded for a hearing on damages.
.............
DONOVAN, J. concurs.
FROELICH, J., concurs:
{¶ 57} I concur in the judgment and note only that, on remand for consideration of
damages, what the evidence will show and the amount of damages, if any, are matters
for the trial court, notwithstanding comments in this opinion.
Copies sent to:
R. Michael Osborn
Stephen D. Miles
Vincent A. Lewis
Hon. Alice O. McCollum