Claycraft Motors, L.L.C. v. Bulldog Auto Sales, Inc. ( 2014 )

[Cite as Claycraft Motors, L.L.C. v. Bulldog Auto Sales, Inc., 2014-Ohio-2086.]
COURT OF APPEALS
FAIRFIELD COUNTY, OHIO
FIFTH APPELLATE DISTRICT
JUDGES:
CLAYCRAFT MOTORS, LLC. : Hon. W. Scott Gwin, P.J.
: Hon. John W. Wise, J.
Plaintiff-Appellant : Hon. Patricia A. Delaney, J.
:
-vs- :
: Case No. 13-CA-70
BULLDOG AUTO SALES, INC.,ET AL :
:
Defendants-Appellees : OPINION
CHARACTER OF PROCEEDING: Civil appeal from the Fairfield County Court
of Common Pleas, Case No. 2011 CV
01002
JUDGMENT: Affirmed
DATE OF JUDGMENT ENTRY: May 12, 2014
APPEARANCES:
For Plaintiff-Appellant For Defendants-Appellees
DAVID A. SKROBOT STEVEN KOKENSPARGER
JOHN RIDGE KOKENSPARGER & RYAN, LLC
BRETT SHERAW 140 Mill Street, Suite B
FISHER, SKROBOT & SHERAW, LLC Gahanna, OH 43004
471 East Broad St., Ste. 1810
Columbus, OH 43215
[Cite as Claycraft Motors, L.L.C. v. Bulldog Auto Sales, Inc., 2014-Ohio-2086.]
Gwin, P.J.
{¶1} Appellant appeals the May 8, 2012 judgment entry by the Fairfield County
Court of Common Pleas and the September 13, 2013 judgment entry clarifying the May
8th judgment entry and granting appellees’ motion to vacate judgment.
Facts & Procedural History
{¶2} On October 5, 2011, appellant Claycraft Motors, LLC, filed a complaint
against appellees Bulldog Auto Sales, Inc. and its owner, Theodore Johnson
(“Johnson”), for monies due and owing over the sale of motor vehicles to appellees.
Appellant alleged appellees agreed to purchase five motor vehicles from appellant and
appellees failed to pay for the vehicles after appellant delivered them. On October 7,
2011, certified mail receipts were returned to the Fairfield County Clerk of Courts and
the notation on the docket indicates the signature was illegible on each receipt.
Appellant filed a motion for default judgment on November 17, 2011 and included the
affidavit of James Hornberger, a member of appellant’s LLC. Hornberger stated
appellant entered into several contracts where appellees agreed to purchase motor
vehicles from appellants. Further, appellant delivered the vehicles to appellees and
appellees failed to pay for five vehicles for a total of $39,800. By judgment entry filed
the same date, the trial court granted the motion and found in favor of appellant in the
amount of $39,800, plus interest and costs.
{¶3} In January of 2012, the trial court issued an order setting a judgment
debtor examination for February 27, 2012. On February 23, 2012, Johnson filed a pro
se motion to continue the debtor’s exam to obtain counsel. The trial court granted the
motion to continue on February 24, 2012.
Fairfield County, Case No. 13-CA-70 3
{¶4} On April 20, 2012, appellees filed a motion to vacate judgment pursuant to
Civil Rule 60(B). In their motion, appellees argued no certified or personal service was
completed on appellees and that they had a meritorious defense, i.e. payment, to the
complaint. Attached to appellees’ motion was the affidavit of Johnson. Johnson stated
he did not receive actual notice of the filing of the complaint that led to the default
judgment and was never notified of a hearing on the complaint or damages. Johnson
said he was unaware of the filing of the complaint or the default judgment until January
of 2012. Johnson alleged he and Bulldog Auto Sales, Inc. had a meritorious defense to
the complaint because he paid appellant for the vehicles. Appellant filed a
memorandum in opposition to appellees’ motion to vacate on May 7, 2012.
{¶5} The trial court held an evidentiary hearing on May 7, 2012. Johnson
testified at the hearing and stated he did not sign for the complaint and was not sure
who did. Further, that the service to him personally was sent to the business address
and not his home address. Johnson stated, at the time the complaint would have been
served on him, he was involved in a contested divorce and was served with multiple
legal papers with regard to the divorce case. Johnson testified the 2003 BMW M3 was
never delivered to him by appellant, the 2003 Chevrolet diesel truck was a title swap so
no checks were exchanged between the parties, he paid for both a 2008 Ford Escape
and a 2000 Chevy Tahoe, and appellant refused to pick up a 2008 ATV after appellees
determined they were not going to purchase the vehicle.
{¶6} The trial court granted appellees’ motion on May 8, 2012 and vacated the
default judgment. The trial court found the Rule 60(B) motion to be timely and found
appellees have meritorious defenses to the claims presented. Further, the interests of
Fairfield County, Case No. 13-CA-70 4
justice warrant the use of the Civil Rule 60(B)(5) catch-all provision. The trial court
found it did not need to address Civil Rule 60(B)(1) since appellees were entitled to
relief pursuant to Civil Rule 60(B)(5). Appellant appealed the May 8, 2012 judgment
entry to this Court. In Claycraft Motors, LLC, v. Bulldog Auto Sales, Inc., Delaware No.
12-CA-29, 2013-Ohio-1048, we reversed the trial court’s decision and remanded the
matter to the trial court to clarify which defendant[s] was granted relief. On September
13, 2013, the trial court issued a judgment entry clarifying that it was the trial court’s
intention to vacate the default judgment as to both Johnson and Bulldog Auto Sales,
Inc.
{¶7} Appellant appeals the May 8, 2012 and September 13, 2013 judgment
entries of the Fairfield County Court of Common Pleas and assigns the following as
error:
{¶8} “I. THE TRIAL COURT ERRED IN GRANTING THEODORE JOHNSON
AND BULLDOG AUTO SALES, INC.’S MOTION TO VACATE JUDGMENT BECAUSE
CIV.R. 60(B)(5) WAS USED BY THE TRIAL COURT TO GRANT RELIEF EVEN
THOUGH APPELLEES FAILED TO PROTECT THEIR INTERSTS OR PARTICIPATE
IN THE LEGAL PROCESS, NO EXTRAORDINARY CIRCUMSTANCES WERE
ALLEGED AND THE MOTION TO VACATE WAS NOT TIMELY FILED.”
I.
{¶9} The order from which appellant has appealed vacated the earlier judgment
granted by the trial court. This Court, therefore, has jurisdiction pursuant to Section
2505.02(B)(3) of the Ohio Revised Code. The decision whether to grant a motion for
relief from judgment under Civ.R. 60(B) lies within the trial court’s sound discretion.
Fairfield County, Case No. 13-CA-70 5
Griffey v. Rajan, 33 Ohio St. 3d 75, 514 N.E.2d 1122 (1987). In order to find abuse of
discretion, we must determine the trial court’s decision was unreasonable, arbitrary, or
unconscionable. Blakemore v. Blakemore, 5 Ohio St. 3d 217, 450 N.E.2d 1140 (1983).
{¶10} Civil Rule 60(B) provides, “on motion and upon such terms as are just, the
court may relieve a party * * * from a final judgment, order or proceedings for the
following reasons: (1) mistake, inadvertence, surprise or excusable neglect; * * * or (5)
any other reason justifying relief from judgment. The motion shall be made within a
reasonable time, and for reasons (1), (2), and (3) not more than one year after the
judgment * * * was entered to taken.” Civil Rule 60(B). A party seeking relief from
judgment pursuant to Civ.R. 60(B) must show: “(1) a meritorious defense or claim to
present if relief is granted; (2) entitlement to relief under one of the grounds set forth in
Civ.R. 60(B)(1)-(5); and (3) the motion must be timely filed.” GTE Automatic Electric,
Inc. v. ARC Industries, Inc., 47 Ohio St. 2d 146 at paragraph two of syllabus, 351 N.E.2d
113 (1976). Further, “where timely relief is sought from a default judgment and the
movant has a meritorious defense, doubt, if any, should be resolved in favor of the
motion to set aside the judgment so that cases may be decided on their merits.” Id.
{¶11} In this case, there is no dispute that appellees set forth a meritorious
defense. Johnson testified he paid for the vehicles at issue, either by check or with a
title swap, and introduced Exhibit A, a check for payment of one of the vehicles at issue.
Timeliness of Motion
{¶12} Appellant argues appellees’ motion was not timely because the motion
was filed more than six months after the complaint and summons were served and
more than five months after default judgment was granted. We disagree.
Fairfield County, Case No. 13-CA-70 6
{¶13} A Civ.R. 60(B)(5) motion must be made within a reasonable time, but the
rule does not specify what qualifies as a reasonable time. Zwahlen v. Brown, 1st Dist.
Hamilton No. C-070263, 2008-Ohio-151. The determination as to what constitutes
reasonable time is for the trial court to determine in the exercise of sound discretion.
Robinson v. Miller Hamilton Venture, LLC, 12th Dist. Butler No. CA2010-09-226, 2011-
Ohio-3017.
{¶14} In this case, Johnson testified he learned of the default judgment against
him in January of 2012 and, soon after he got the notice of the debtor’s exam, filed a
motion to continue the February 2012 debtor’s exam in order to obtain counsel and
determine how to address the complaint filed in October of 2011 and the default
judgment in November of 2011. Counsel for appellees subsequently filed the motion to
vacate on April 20, 2012, less than two months after appellees’ motion to continue the
debtor’s exam. Johnson testified that, during this time, he was going through a
complicated divorce proceeding. Upon review of the record and in light of the evidence
presented for the trial court’s consideration, we find appellant failed to establish the trial
court’s conclusion that appellees’ motion to vacate was made within a reasonable time
constituted an abuse of discretion.
60(B)(5)
{¶15} Appellant contends the trial court improperly utilized Civ.R. 60(B)(5) as a
substitute for a specific provision in Civ.R. 60(B)(1)-(4), appellees failed to defend their
interests, and the failure to timely file an answer in this case does not rise to the level of
extraordinary circumstances as required by Civ.R. 60(B)(5). We disagree.
Fairfield County, Case No. 13-CA-70 7
{¶16} Civil Rule 60(B)(5) operates as a catch-all provision and “reflects the
inherent power of a court to relieve a person from the unjust operation of a judgment.”
Dutton v. Potroos, 5th Dist. No. 2010CA00318, 2011-Ohio-3646. However, it is not to
be used as a substitute for any of the other more specific provisions of Civ.R. 60(B) and
the grounds for invoking Civ.R. 60(B)(5) should be substantial. Caruso-Ciresi, Inc. v.
Lohman, 5 Ohio St. 3d 64, 448 N.E.2d 1365 (1983). It is to be used in extraordinary and
unusual cases when the interests of justice warrant it. Adomeit v. Baltimore, 39 Ohio
App.2d 97, 316 N.E.2d 469 (8th Dist. 1974). Some courts have granted relief under
Civ.R. 60(B)(5) for failure of service. Lade v. Wheeler, 12th Dist. Clermont No. CA99-
10-096, 2000 WL 525717 (May 1, 2000); Steinhoff v. Nyerghes, 8th Dist. Cuyahoga No.
76096, 2000 WL 336521 (March 30, 2000); Rafalski v. Oates, 17 Ohio App. 3d 65, 477
N.E.2d 1212 (8th Dist. 1984); Rogers v. United Presidential Life Ins. Co., 36 Ohio
App.3d 126, 521 N.E.2d 845 (10th Dist. 1987).
{¶17} In this case, appellees attached to their motion to vacate the sworn
affidavit of Johnson stating he did not receive service of the complaint against him. At
the evidentiary hearing on appellees’ motion, Johnson testified he was not properly
served with the complaint and he did not receive any actual notice of the action against
him at the time the default judgment was granted. Johnson stated he was going
through a difficult and contested divorce at the time appellant’s complaint was filed and
the default judgment was granted. Johnson was being served with multiple documents
on a regular basis for his divorce, but stated he did not receive notice of appellant’s
complaint. Johnson could not tell who signed for the complaint and the Clerk of Courts
Fairfield County, Case No. 13-CA-70 8
noted on the docket that the signatures on the certified mail return receipts for appellees
were illegible.
{¶18} Appellant opposed the motion to vacate and stated it obtained valid
service on appellees because they complied with the civil rules. However, appellant did
not contradict Johnson’s testimony that appellees never received actual service of the
complaint and were unaware of the pendency of the case until January of 2012. The
trial court was faced with competing interests in ruling on the motion. “On one hand is
the principle of finality of judgment and the non-moving party’s right to have his
judgment enforced. On the other hand is the principle that cases should be decided on
their merits and the right of all parties to be heard.” Robinson v. Miller Hamilton
Venture, LLC, 12th Dist. Butler No. CA2010-09-226, 2011-Ohio-3017. The trial court
was in the best position to balance these competing interests. Further, the trial court’s
reference to Civ.R. 60(B)(5) pertained to a ground not contained in Civ.R. 60(B)(1). See
American Select Ins. Co. v. Riggs, 10th Dist. Franklin No. 01AP-380, 2007-Ohio-1808.
Based on the facts and circumstances in this case, we find the trial court did not abuse
its discretion in finding an extraordinary or unusual situation to warrant the application of
Civ.R. 60(B)(5).
Fairfield County, Case No. 13-CA-70 9
{¶19} Accordingly, because the trial court did not abuse its discretion by granting
relief from judgment, appellant’s assignment of error is overruled. The May 8, 2012
judgment entry by the Fairfield County Court of Common Pleas and the September 13,
2013 judgment entry clarifying the May 8th judgment entry are affirmed.
By Gwin, P.J.,
Wise, J., and
Delaney, J., concur