RPC Elec., Inc. v. Wintronics, Inc. , 2012 Ohio 1202 ( 2012 )

[Cite as RPC Elec., Inc. v. Wintronics, Inc., 2012-Ohio-1202.]
Court of Appeals of Ohio
EIGHTH APPELLATE DISTRICT
COUNTY OF CUYAHOGA
JOURNAL ENTRY AND OPINION
No. 97511
RPC ELECTRONICS, INC.
PLAINTIFF-APPELLANT
vs.
WINTRONICS, INC.
DEFENDANT-APPELLEE
JUDGMENT:
REVERSED AND REMANDED
Civil Appeal from the
Cuyahoga County Common Pleas Court
Case No. CV-753980
BEFORE: Boyle, P.J., S. Gallagher, J., and E. Gallagher, J.
RELEASED AND JOURNALIZED: March 22, 2012
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ATTORNEYS FOR APPELLANT
Brittney L. Cogan
Peter Turner
Meyers, Roman, Friedberg & Lewis
28601 Chagrin Boulevard
Suite 500
Cleveland, Ohio 44122
ATTORNEYS FOR APPELLEE
Matthew T. Fitzsimmons III
R. Christopher Yingling
Nicola, Gudbranson & Cooper, LLC
Republic Building, Suite 1400
25 West Prospect Avenue
Cleveland, Ohio 44115
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MARY J. BOYLE, P.J.:
{¶1} This case came to be heard upon the accelerated calendar pursuant to
App.R. 11.1 and Loc.R. 11.1.
{¶2} Plaintiff-appellant, RPC Electronics, Inc. (“Electronics”), appeals the trial
court’s decision granting defendant-appellee’s, Wintronics, Inc., Civ.R. 12(B)(6) motion
to dismiss. We reverse the decision of the trial court and remand for further
proceedings.
Procedural History and Facts
{¶3} In April 2011, Electronics commenced the underlying action against
Wintronics, asserting two counts for breach of contract. With regard to the first count,
Electronics alleged that “[b]eginning in July 2006 to August 2006, [it] contracted with
[Wintronics] for the assembly of 90 printed circuit board assembly units (‘PCBA’).” It
further alleged that, during this same time period, it sent Wintronics “purchase orders for
90 Printed Circuit Boards (‘PCBs’) plus labor, which involve [Wintronics] affixing
[Electronics’] pre-shipped component kits (‘Kits’) to PCBs acquired by [Wintronics]
from a third party company to create PCBAs.” Electronics alleged that Wintronics
“affixed 90 of [Electronics’] Kits to 90 defective PCBs, thereby destroying 90 of
[Electronics’] Kits.”
{¶4} As for the second count, Electronics alleged that Wintronics was
“responsible for the conversion of 5 PCBAs (from Omnia 5 boards to Omnia 6 boards)
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(‘Converted Boards’)” and the delivery of the Converted Boards to Electronics’
customer. Electronics alleged that Wintronics failed to ship the Converted Boards to its
customer.
{¶5} Based on these alleged breaches, Electronics sought $50,494.20 in
damages.
{¶6} In response to the complaint, Wintronics filed a motion for a more definite
statement, requesting that Electronics attach the purchase orders to the complaint that
gave rise to the claims. The trial court granted Wintronics’ motion, and Electronics
subsequently submitted invoices and purchase orders relating to the claims. Wintronics
then moved to dismiss the complaint on the grounds that the purchase orders related to
the sale of goods, not services, and therefore the Uniform Commercial Code’s (“UCC”)
more restrictive four-year statute of limitations governed the contract. Electronics
opposed the motion, arguing that it had stated a claim that which relief could be granted.
It argued that the contract was a mixed purpose contract for the sale of goods and services
and that, based on the purchase orders, the sale of services predominate the contract,
thereby invoking a fifteen-year statute of limitations.
{¶7} The trial court ultimately granted Wintronics’ motion to dismiss, finding
that “[t]he underlying contract * * * between the two parties was for the sale of goods.”
The court found that the purpose of the contract “was for the defendant to supply
[plaintiff’s] customer with a working finished product” and therefore the claims were
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time barred under the statute of limitations.
{¶8} Electronics appeals, raising a single assignment of error:
{¶9} “The trial court erred as a matter of law in granting appellee’s motion to
dismiss.”
Civ.R. 12(B)(6) Standard
{¶10} “A motion to dismiss for failure to state a claim upon which relief can be
granted * * * tests the sufficiency of the complaint.” State ex rel. Hanson v. Guernsey
Cty. Bd. of Commrs., 65 Ohio St.3d 545, 548, 605 N.E.2d 378 (1992). A motion made
under Civ.R. 12(B)(6) only determines whether the pleader’s allegations set forth an
actionable claim; indeed, a court “may not use the motion to summarily review the merits
of the cause of action.” Ward v. Graue, 12th Dist. No. CA2011-04-032,
2012-Ohio-760, ¶ 9.
{¶11} In order to prevail on a Civ.R. 12(B)(6) motion, it must appear beyond
doubt from the complaint that the plaintiff can prove no set of facts entitling plaintiff to
recover. Hester v. Dwivedi, 89 Ohio St.3d 575, 733 N.E.2d 1161 (2000). A court is
confined to the averments set forth in the complaint and cannot consider outside
evidentiary materials. Id.; see also Greeley v. Miami Valley Maintenance Contrs. Inc.,
49 Ohio St.3d 228, 551 N.E.2d 981 (1990). Moreover, a court must presume that all
factual allegations set forth in the complaint are true and must make all reasonable
inferences in favor of the nonmoving party. Mitchell v. Lawson Milk Co., 40 Ohio St.3d
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190, 532 N.E.2d 753 (1988). Therefore, “as long as there is a set of facts, consistent
with the plaintiff’s complaint, which would allow the plaintiff to recover, the court may
not grant a defendant’s motion to dismiss.” York v. Ohio State Hwy. Patrol, 60 Ohio
St.3d 143, 145, 573 N.E.2d 1063 (1991).
{¶12} We review the trial court’s decision granting a motion to dismiss under a de
novo standard of review. Perrysburg Twp. v. Rossford, 103 Ohio St.3d 79,
2004-Ohio-4362, 814 N.E.2d 44, ¶ 5.
{¶13} The gravamen of Wintronics’ motion to dismiss was that Electronics’
claims were time barred because the predominant purpose of the underlying contract, as
evidenced by the purchase orders, was for the sale of goods. While we recognize that
the trial court could consider the purchase orders that were submitted in response to
Wintronics’ Civ.R. 12(E) motion for a more definite statement, we do not find that the
purchase orders and invoices conclusively answer the question. It is not apparent on the
face of these documents whether the predominant purpose of the parties’ underlying
contract was for the sale of goods or the sale of services.
{¶14} Notably, Electronics alleged that it contracted with Wintronics “for the
assembly” of 90 PCBA units that involved Wintronics using Electronics’ pre-shipped
Kits to affix to another component for the purpose of creating PCBAs. Electronics
further alleged that it contracted with Wintronics for the conversion of converter boards
to be delivered to Electronics’ customer. These allegations support a theory of a breach
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of contract based on services. But the resolution of this issue is not amenable to a
motion to dismiss. From the face of the complaint and the attached purchase orders, it is
not apparent that the predominant purpose of the contract is the sale of goods or the sale
of services. Indeed, both parties contend that the purchase orders support its respective
position. Electronics argues that the purchase orders and invoices reveal 80 percent of
services and 20 percent of goods. Conversely, Wintronics argues that the purchase
orders involve solely the sale of goods. But the parties’s respective positions are merely
argument and conjecture and are not apparent from the face of the documents.
{¶15} We are limited to reviewing the complaint and the documents submitted in
response to the motion for a more definite statement. And based on these documents,
we find that Electronics has satisfied its burden to withstand a motion to dismiss. “A
complaint may not be dismissed under Civ.R. 12(B)(6) for failing to comply with the
applicable statute of limitations unless the complaint on its face conclusively indicates
that the action is time-barred.” Harris v. Pro-Lawn Landscaping, Inc., 8th Dist. No.
97302, 2010-Ohio-498, ¶ 7. Here, we cannot say that it is apparent that the predominant
purpose of the contract is the sale of goods, therefore invoking a four-year statute of
limitations under the UCC (as codified in R.C. 1302.01 et seq.).
{¶16} And to the extent that both parties seek this court to make a determination
of the applicable statute of limitations, this issue is not ripe for review. Nor do we find
sufficient evidence in the record to do so. We do note, however, that Wintronics bears
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the burden of establishing that the UCC applies. See Renaissance Technologies, Inc. v.
Speaker Components, Inc., 9th Dist. No. 21183, 2003-Ohio-98, ¶ 15. And whether a
transaction predominantly involves goods or services is ordinarily a question of fact for
the jury. Mecanique C.N.C., Inc. v. Durr Environmental, Inc., 304 F. Supp.2d 971(S.D.Ohio 2004). Under certain circumstances, however, the matter may be resolved by
the court as a matter of law under Civ.R. 56 if there is no factual dispute. But even then,
Wintronics bears the burden of demonstrating this and providing the court with evidence
to support its position.
{¶17} Accordingly, having found that the trial court erred in granting Wintronics’
motion to dismiss, we sustain the sole assignment of error and remand for further
proceedings.
{¶18} Judgment reversed and case remanded to the lower court for further
proceedings consistent with this opinion.
It is ordered that appellant recover from appellee 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.
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MARY J. BOYLE, PRESIDING JUDGE
SEAN C. GALLAGHER, J., and
EILEEN A. GALLAGHER, J., CONCUR