Marion Forum, L.L.C. v. Lynick Ents., Inc. ( 2012 )

[Cite as Marion Forum, L.L.C. v. Lynick Ents., Inc., 2012-Ohio-5947.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
MARION COUNTY
MARION FORUM, LLC,
PLAINTIFF-APPELLANT, CASE NO. 9-12-13
v.
LYNICK ENTERPRISES, INC., ET AL.,
OPINION
DEFENDANTS-APPELLEES.
Appeal from Marion County Common Pleas Court
Trial Court No. 09-CV-0487
Judgment Affirmed
Date of Decision: December 17, 2012
APPEARANCES:
Kevin P. Collins for Appellant
Brent M. Harraman for Appellee
Case No. 9-12-13
PRESTON, J.
{¶1} Plaintiff-appellant, Marion Forum, LLC, appeals the Marion County
Court of Common Pleas’ jury verdict finding that Marion Forum breached its
contract with defendant-appellee Lynick Enterprises, Inc., and awarding Lynick a
total of $304,411.96 in damages, attorney fees, costs, and prejudgment interest.
Marion Forum contends the jury’s verdict is against the manifest weight of the
evidence, is supported by insufficient evidence, that Lynick failed to establish its
lost profits with sufficient certainty, and that the trial court erred by awarding
Lynick prejudgment interest and expert witness fees. For the reasons that follow,
we affirm.
{¶2} On January 7, 2009, Marion Forum filed a complaint against Lynick
in the Marion Municipal Court. (Doc. No. 1). Marion Forum alleged Lynick had
breached the terms of its lease agreement by failing to pay rent and late charges
amounting to $5,263.16. (Id.).
{¶3} On March 17, 2009, Lynick filed its answer and counterclaim. (Id.).
Lynick alleged that Marion Forum had breached the terms of the lease agreement
by failing to properly maintain the common area. (Id.). Lynick sought damages in
excess of $25,000. (Id.).
{¶4} On May 12, 2009, Lynick filed a motion to transfer the case to the
Marion County Court of Common Pleas because its counterclaim exceeded the
-2-
Case No. 9-12-13
Marion Municipal Court’s monetary jurisdiction. (Id.). On June 8, 2009, the
Marion Municipal Court granted Lynick’s motion and ordered the clerk of courts
to transfer the case to the Marion County Court of Common Pleas. (Id.).
{¶5} On January 24, 2011, Marion Forum filed a motion to exclude an
expert report and testimony by Howard Cannon, whom Lynick had identified as
its expert witness. (Doc. No. 41). On February 10, 2011, Lynick filed its motion
in response. (Doc. No. 45).
{¶6} The matter proceeded to a jury trial on March 14-17, 2011, where the
trial court admitted Cannon’s expert testimony and report. (Tr. Vol. I at 1); (Tr.
Vol. III at 461). On March 17, 2011, the jury found in favor of Lynick and
awarded Lynick $225,000 in damages. (Doc. No. 69).
{¶7} On March 21, 2011, Lynick filed a motion requesting attorney fees
and costs based on the parties’ lease agreement. (Doc. No. 70). On April 6, 2011,
Marion Forum filed its motion in response. (Doc. No. 77). On June 7, 2011, the
parties waived any right they had to a hearing on the issue of attorney fees and
costs and requested that the trial court make its ruling based on their motions.
(Doc. No. 79). On June 9, 2011, the trial court issued its judgment entry
confirming the jury’s verdict of $225,000 and granting Lynick’s motion for
attorney fees of $36,370.52 and expert witness fees of $20,619.58. (Doc. No. 80).
-3-
Case No. 9-12-13
The trial court granted judgment in favor of Lynick for a total of $281,990.10.
(Id.).
{¶8} On June 10, 2011, Lynick filed a motion for an award of prejudgment
interest. (Doc. No. 82). On June 27, 2011, Marion Forum filed its motion in
response. (Doc. No. 86).
{¶9} On July 5, 2011, Marion Forum filed a notice of appeal of the trial
court’s June 9, 2011 judgment. (Doc. No. 88). This Court dismissed that appeal,
finding that the trial court’s judgment was a non-final order since there were issues
the trial court still needed to resolve. (Doc. No. 91).
{¶10} On October 13, 2011, the trial court held a hearing on Lynick’s
motion for prejudgment interest. (Doc. No. 96). On November 15, 2011, the trial
court filed its judgment entry granting Lynick’s motion for prejudgment interest.
(Id.). On November 30, 2011, the trial court issued a judgment entry awarding
Lynick prejudgment interest in the amount of $22,421.86. (Doc. No. 97).
{¶11} Marion Forum timely appealed. Marion Forum now raises seven
assignments of error for our review. For the purposes of our discussion, we will
address the assignments of error out of the order presented in the briefs and
consolidate them where appropriate.
-4-
Case No. 9-12-13
Assignment of Error No. I
The manifest weight of the evidence established that defendant-
appellee was in default of the contract and was liable for
damages
Assignment of Error No. III
The manifest weight of the evidence establishes that plaintiff-
appellant was not in default under the contract
{¶12} In its first and third assignments of error, Marion Forum argues the
jury’s verdict was against the manifest weight of the evidence. Marion Forum
contends that the manifest weight of the evidence established that Lynick was in
default under the contract. Marion Forum argues the jury lost its way because
Marion Forum was not in default according to the terms of the lease. Marion
Forum also contends that Lynick failed to give appropriate notice pursuant to the
lease, so Marion Forum could not have breached the contract because proper
notice was required prior to default.
{¶13} In determining whether a judgment is against the manifest weight of
the evidence, we cannot substitute our judgment for that of the jury. The jury is in
a better position to observe the demeanor of the witnesses, examine the evidence,
and weigh the credibility of the testimony and evidence. Seasons Coal Co. v.
Cleveland, 10 Ohio St.3d 77, 80 (1984). Instead, we must determine whether the
jury’s verdict is supported by some competent, credible evidence going to all the
-5-
Case No. 9-12-13
essential elements of the case. Id.; C.E. Morris Co. v. Foley Constr. Co., 54 Ohio
St.2d 279, 280 (1978).
{¶14} A complaining party establishes a claim for breach of contract by
proving the following elements by a preponderance of the evidence: “(1) a
contract existed, (2) the complaining party fulfilled its contractual obligations, (3)
the opposing party failed to fulfill its obligations, and (4) the complaining party
incurred damages as a result of this failure.” Langfan v. Carlton Gardens
Company, 183 Ohio App.3d 260, 2009-Ohio-3318, ¶ 25 (3d Dist.), citing Farmers
State Bank v. Followay, 9th Dist. No. 07CA0011, 2007-Ohio-6399, ¶ 13.
{¶15} In the present case, the parties do not dispute the validity of their
lease agreement. Marion Forum simply contends that it did not violate the terms
of the lease agreement, that Lynick did violate the terms of the lease agreement,
and that Lynick did not incur any damage as a result of Marion Forum’s alleged
breach. We will first address Marion Forum’s argument that Lynick cannot
prevail because it did not provide notice according to the terms of the contract,
then address whether the jury’s verdict was against the manifest weight of the
evidence.
A. Notice
{¶16} The parties stipulated that Lynick did not pay its common area
maintenance charges during the summer of 2008. (Tr. Vol. I at 6-7); (Joint Ex. 1).
-6-
Case No. 9-12-13
The parties further stipulated that if Lynick were found liable for the unpaid
common area maintenance charges, that Lynick would owe Marion Forum
$5,263.16. (Id.); (Id.). Lynick argued at trial, and argues on appeal, that it
stopped paying its common area maintenance charges because Marion Forum had
violated the lease agreement by not maintaining the common area as required.
The lease states:
In the event [Marion Forum] defaults in the performance of any of
its obligations, covenants and warranties hereunder and if such
default continues for a period of thirty (30) days after written notice
to [Marion Forum] from [Lynick] specifying the nature of such
default or such additional cure period as is reasonable under the
circumstances if such default is not capable of cure within thirty (30)
days provided [Marion Forum] has commenced to cure the default
within the thirty (30) day period and thereafter diligently completes
same. If [Marion Forum] or its mortgagee does not cure the default
within the aforesaid time periods, [Lynick] may, at its option, and
upon at least an additional ten (10) days written notice to [Marion
Forum] and its mortgagee, cure the same on behalf of [Marion
Forum], whereupon the cost of such curing and any out-of-pocket
expenses reasonably and necessarily arising as a consequence
-7-
Case No. 9-12-13
thereof, shall be due and payable to [Lynick] from [Marion Forum]
upon demand therefor by [Lynick] * * *. The foregoing shall be for
[Lynick’s] protection only and exercisable only at its option. The
foregoing shall not limit or preclude [Lynick] from any other rights
and remedies available at law or in equity.
(D. Ex. T). The notice provision of the lease further states, “[a]ll notices, demands
and communications provided herein shall be sent by United States registered
mail, postage prepaid, return receipt requested, nationally-recognized mail carrier
(such as Federal Express, UPS Next Day Air, etc.) * * *.” (Id.).
{¶17} At trial, Lynick, which operated as CiCi’s Pizza in Marion, alleged
that Marion Forum had failed to address numerous maintenance issues.
Specifically, Lynick claimed Marion Forum did not replace burnt out lights
resulting in inadequate exterior lighting, that Marion Forum failed to remove trash
from the outdoor area, that snow and ice was not adequately cleared from the
sidewalks and parking lot in front of CiCi’s Pizza, that Marion Forum failed to fill
large potholes in a timely manner, and that Marion Forum did not maintain proper
traffic signs, which created a dangerous intersection near CiCi’s Pizza. Mick
McCardle, Lynick’s president and the operator of the CiCi’s Pizza at issue in this
case, testified that he had repeatedly discussed the maintenance issues with Dave
Wakeman, the senior property manager for NAI Ohio Equities. (Tr. Vol. II at
-8-
Case No. 9-12-13
334-335); (Id. at 266). Ohio Equities was the agent for the management of the
Marion Forum Shopping Center. (Id. at 266). McCardle testified that he had a
conversation with Wakeman that was witnessed by the former assistant manager
of CiCi’s Pizza. (Id. at 365-366). McCardle told Wakeman that there were
numerous issues, including grates that needed repaired, problems with the
landscaping, and problems with the lighting. (Id.). McCardle testified that he told
Wakeman that according to the lease, McCardle could fix the problems himself
and deduct the cost from his rent. (Id.). According to McCardle, Wakeman
refused to permit McCardle to fix the maintenance issues because Wakeman
believed it was Ohio Equities’ responsibility. (Id.).
{¶18} McCardle also testified that he wrote multiple letters regarding the
maintenance issues to Ohio Equities. (Id. at 358-359). McCardle sent the first
letter to Sherry Howard, the Controller for Ohio Equities, on March 29, 2008.
(Id.); (D. Ex. P). In that letter, McCardle informed Ohio Equities of the
maintenance issues he felt were negatively impacting his business, including the
exterior lighting, traffic signs, potholes, parking lot conditions, and semi-trucks
parked in front of the restaurant. (Id.); (Id.). McCardle testified that he did not
receive a response to his first letter. (Tr. Vol. II at 358-359).
{¶19} McCardle testified that following that conversation, he sent a second
letter to Howard on April 29, 2008. (Id.); (D. Ex. P). In the second letter,
-9-
Case No. 9-12-13
McCardle stated he was following up on his previous letter, noted that the
maintenance problems had not been resolved, and stated that he was going to seek
whatever remedies he could to address the issues. (Id.); (Id.). In that letter,
McCardle informed Ohio Equities that he would be withholding his common area
maintenance payment and had informed his attorney of the problem. (D. Ex. P).
{¶20} McCardle testified that he sent a third letter on May 28, 2008, but
sent the letter to Wakeman instead of Howard. (Tr. Vol. II at 367); (D. Ex. P). In
that letter, McCardle repeated the ongoing issues he was having with the quality of
the maintenance and that he believed the maintenance was negatively affecting his
business. (Id.); (Id.). McCardle also stated that he had contacted his attorney and
enclosed the first two letters. (D. Ex. P). On cross examination, McCardle
admitted that he had not sent any of the letters by certified mail. (Id. at 421).
{¶21} Wakeman testified that he had met with McCardle to discuss the
maintenance issues with him, but did not recall the exact conversation or when it
took place. (Id. at 274). Wakeman also testified that Ohio Equities had received
McCardle’s May 2008 letter, and that he had sent McCardle a letter in response
informing him that he had breached the lease by failing to pay his maintenance
fees. (Id. 275-276). Wakeman testified that the letters McCardle sent Ohio
Equities regarding the maintenance issues were not sent by certified mail, even
though that was what the lease required. (Id. at 304-305).
-10-
Case No. 9-12-13
{¶22} “Although courts generally should give effect to the plain meaning of
the parties’ unambiguously expressed intentions, in some circumstances, courts
will not strictly enforce contractual language requiring notice in writing.”
Gollihue v. Natl. City Bank, 10th Dist. No. 11AP-150, 2011-Ohio-5405, ¶ 22,
citing Hackman v. Szczygiel, 10th Dist. No. 06AP-187, 2006-Ohio-5872. In those
cases, a failure to provide notice according to the terms of the contract may not
preclude recovery on the contract where the party has received actual notice.
Gollihue at ¶ 22-23; Adair v. Landis Properties, 10th Dist. No. 08-AP-139, 2008-
Ohio-4593, ¶ 13; Terreri & Sons, Inc. v. Mahoning Cty. Bd. of Commrs., 152 Ohio
App.3d 95, 2003-Ohio-1227, ¶ 76 (7th Dist.). “The purpose of requiring written
notice is not to be hypertechnical but, instead, to create certainty.” McGowan v.
DM Group IX, 7 Ohio App.3d 349, 353 (10th Dist.1982).
{¶23} In the present case, the record demonstrates that Marion Forum did
receive actual notice of McCardle’s maintenance issues through its agents,
Wakeman and Howard. In fact, Marion Forum does not dispute that it received
written notice, only that the notice was not properly provided through certified
mail. We cannot find that McCardle’s failure to send notice through certified mail
precludes him from recovering for any breach of the contract where Marion Forum
had actual notice. We will now review the evidence presented at trial to determine
-11-
Case No. 9-12-13
if the jury’s verdict was against the manifest weight of the evidence as Marion
Forum contends.
B. Manifest Weight of the Evidence
{¶24} The lease agreement between Marion Forum and Lynick states,
“[Marion Forum] shall operate, maintain, and repair the Common Area in such a
manner as [Marion Forum] in its sole discretion determine using, however first-
class community shopping center practices.” (D. Ex. T). The lease further
provides that:
The term ‘Common Area Maintenance Costs’ shall mean all costs,
expenses and other charges incurred in connection with the
ownership, operation, insurance, maintaining and repair of the
Common Area, and shall include, but not be limited to, the costs and
expenses of the following:
(i) Removal of trash and garbage, excluding all garbage or trash of
which the removal is regulated to be handled by others by any
federal, state or local rule, law, statute, regulation, ordinance or code
and all garbage and trash of any other tenant use in the Shopping
Center;
(ii) Exterior planting, replanting, replacing and upkeep of grass,
flowers, shrubbery, plant, trees and other landscaping;
-12-
Case No. 9-12-13
(iii) Maintenance, repair, replacement and substitution of all
portions of the Common Area, including signs, planters, benches,
common fire exits, doors and hardware, parking lot surfaces and
traffic control systems * * *.
{¶25} At trial, Lynick presented numerous witnesses who testified about
the lack of maintenance in the common area outside of CiCi’s Pizza. Valerie
Jolley, an employee at the dentist’s office next to CiCi’s Pizza, testified that the
maintenance crews provided landscaping services, such as removing weeds, for
the dentist’s office but not for CiCi’s Pizza. (Tr. Vol. I at 106-108). She had
noticed that, within the last few years, Cici’s Pizza received different treatment
from the dentist’s office because the weeds and snow were not removed from the
area near the restaurant. (Id. at 113).
{¶26} William Doyle, a local mechanic, testified that there was a very large
pothole near the entrance to the shopping center. (Id. at 116). Doyle repaired
McCardle’s vehicle in March 2008 after it hit the pothole, and had to replace the
steering column as a result of the damage. (Id. at 116). Doyle testified that he had
driven through the shopping center and sometimes had difficulty avoiding the
pothole when other vehicles were in the exit lane. (Id. at 119). Doyle testified
that the pothole was three or four feet in diameter. (Id.). Doyle also testified that,
when McCardle first opened his restaurant, the outside area was well maintained,
-13-
Case No. 9-12-13
but as time went on the parking lot went into disrepair. Doyle testified that it was
sometimes so dark in the parking lot that it was difficult to see the neon sign
indicating the restaurant was open. (Id. at 123).
{¶27} Sherry Dewalt, a former CiCi’s customer, testified that she had sent a
letter to McCardle in March 2008. (Id. at 130). In the letter, Dewalt informed
McCardle that her family would no longer be customers because of the state of the
parking lot, specifically the lack of lighting and poor snow removal. (Id. at 131-
136); (D. Ex. E). Dewalt testified, “[t]he parking lot and the building were all
really dark over there and it was hard to see when you would come over, and there
was a lot of- there was a lot of snow piled up in the winter time, and it was hard to
access the building.” (Tr. Vol. I at 131).
{¶28} Connie Jeffries, the manager for the Subway restaurant located in the
Marion Forum Shopping Center, testified that she had observed the maintenance
problems outside of CiCi’s Pizza. (Id. at 138-152). Jeffries testified that the
common area was well maintained when CiCi’s Pizza opened, but it had since
deteriorated. (Id. at 139). Jeffries further testified that in early 2008 the parking
lot lights started failing and a large pothole developed near the shopping center
entrance. (Id.). Jeffries testified that at times avoiding the pothole was dangerous
due to oncoming traffic. (Id.). According to Jeffries, the parking lot in front of
CiCi’s Pizza was roped off and inaccessible for around two weeks while the
-14-
Case No. 9-12-13
parking lot was resurfaced. (Id. at 142). Jeffries testified that Subway’s business
did not suffer, but she believed that was because it was located in a different
section of the shopping center. (Id. at 146).
{¶29} Ben Kelly, the former assistant manager of CiCi’s Pizza, testified
that he worked at CiCi’s Pizza from the summer of 2007 until the summer of
2009. (Id. at 181). Kelly testified that there were consistent problems with the
lighting, including canister lights hanging down on their wires, lights out on the
CiCi’s Pizza sign near the road, and lights out in the parking lot. (Id. at 182-185).
“At night it just- looked desolate to an extent.” (Id. at 189). Kelly also testified
that there were problems with the snow removal, including “numerous incidents *
* * with no salt being laid, the walk just not being shoveled at all to the point of- I
mean, we had numerous complaints from people. * * * had a couple elderly
people that had fell [sic] * * *.” (Id. at 193). According to Kelly, the stop signs
were frequently knocked over rather than standing upright, and that he and the
other employees had to pick up trash in the parking lot because the maintenance
crews did not take care of it. (Id. at 194-196). Kelly testified that he had a
telephone conversation with Wakeman, “he told me on the phone that he
understood that there were some issues that needed attended to, but there were
empty buildings or other tenants that hadn’t been paying their rent and the funds
were not available at that time.” (Id. at 198-199). Kelly also testified that he was
-15-
Case No. 9-12-13
working at CiCi’s Pizza when the parking lot was resurfaced. (Tr. Vol. II at 204).
Kelly testified that the parking lot was supposed to be resurfaced at night, but the
work was done during business hours instead, which prevented people from
accessing the restaurant for four or five days. (Id. at 204-206).
{¶30} McCardle testified that his lease was originally with the Kibbey
family, but that Marion Forum later purchased the property and took over the
lease. (Id. at 325-326). According to McCardle, he did not have any problems
with the maintenance when Marion Forum first took over the property, but the
quality of the care began to change in late 2007. (Id. at 329-332). McCardle
testified that at that point, there was a “[l]ack of landscaping, no one picking up
trash, potholes, and continued problems that had started to manifest themselves
with building lights, signs, et cetera, parking lot lights.” (Id. at 332). McCardle
further testified that he and his wife had to remove weeds because the maintenance
crew would spray them with chemicals and leave the dead weeds. (Id. at 334-
336). McCardle testified that he had a constant problem with water collecting in
front of his restaurant because the drains did not work correctly. (Id. at 340).
McCardle also testified that his major concern was the lack of lighting because the
lights were not replaced after they went out. (Id. at 341-342). McCardle testified
that the stop signs near the entrance to the shopping center were frequently broken
or covered with snow, which made it dangerous to enter or exit the shopping
-16-
Case No. 9-12-13
center. (Id. at 351). According to McCardle, there was a large pothole, two and a
half to three feet wide and at least a foot deep, near the entrance to the shopping
center. (Id. at 360). McCardle testified that at times the pothole was unavoidable
if there was too much traffic, and that it was there for several months. (Id.).
McCardle further testified that the catch basin near the sewer had caved in and was
a hazard for customers walking and driving by it. (Id. at 361-362). McCardle
testified that semi-trucks often parked in the first and second row of spots in front
of his business, and that the police could not do anything about it unless there were
signs prohibiting the trucks from parking. (Id. at 364). McCardle testified that
when Marion Forum did have the signs made, they placed them on the other side
of the shopping center, which did not prevent the semi-trucks from parking in
front of his restaurant. (Id.). McCardle testified that over a third of his business
occurred at night, so the lack of lighting in the parking lot, the problems with his
sign being lit properly, and lights that were burnt out on the front of the building
were very detrimental. (Id. at 371).
{¶31} McCardle also testified that he had problems with the maintenance
crews failing to remove snow on the sidewalks and in the parking lot near his
restaurant, and that the maintenance crew told him that they would only put salt on
the snow, rather than shoveling it, unless the snow was at least three inches deep.
(Id. at 381). McCardle testified that the salt and snow resulted in customers
-17-
Case No. 9-12-13
dragging slush into his restaurant, which made it impossible to keep clean. (Id.).
McCardle testified about pictures demonstrating that the snow had been cleared
from the sidewalks in the rest of the shopping center, but that the sidewalks in
front of his restaurant remained covered with snow. (Id. at 388). McCardle
further testified that he had a couple of incidents where a customer fell outside of
his restaurant, and that he had to pay for a customer who was treated at an urgent
care facility after falling on the ice. (Id. at 390).
{¶32} In response, Marion Forum presented witnesses who testified that it
provided common area maintenance as required pursuant to the lease agreement.
Wakeman testified about repairs that were done to the lights and potholes at the
shopping center. (Id. at 269-273). Wakeman testified that they could not
resurface the parking lot at night because they needed the temperature to be above
55 degrees to complete the resurfacing and it was too cold at night at the time that
they needed to complete the resurfacing. (Id. at 283, 309). Wakeman did not
recall a conversation with McCardle where McCardle wanted to reduce his rent
payments in exchange for the costs of maintaining the exterior himself. (Id. at
297). Wakeman testified that the shopping center had some electrical problems,
but he did not think such problems were unusual because it was an older center.
(Id. at 307). Wakeman testified that his relationship with McCardle was not very
good, “He is not- he’s not been like other tenants- engaging, I would say in a
-18-
Case No. 9-12-13
respectful manner. He just- and he has been known to be abusive to my
maintenance people that maintain the property and has shooed them away off the
property.” (Id. at 310).
{¶33} Craig Goodwin, a commercial property manager, testified about the
quality of the maintenance at the shopping center. (Tr. Vol. III at 592). Goodwin
testified that he was familiar with the shopping center because he worked for
Kroger when it opened a store at that location. (Id. at 593-594). Goodwin
testified that he believed the maintenance at the shopping center was consistent
with the maintenance performed at similar shopping centers. (Id. at 595-596).
Goodwin testified that some issues are difficult to address because they are
unexpected, such as ice, snow, and burnt out lights. (Id. at 597-598). Goodwin
testified that the cost of bringing a bucket truck out to change parking lot lights is
prohibitive unless several need to be changed at the same time. (Id. at 599).
{¶34} Jason Johnson, an employee at Johnson Property Services, testified
about the shopping center’s maintenance services. (Id. at 612). Johnson testified
that Wakeman at Ohio Equities had hired Johnson Property Services to provide the
ground and facility maintenance. (Id. at 613). Johnson testified that:
Basically we maintain the existing facility, the ground and facility
maintenance and such, from weekly routine things you do at home,
lawn care, landscaping, pulling weeds and such, snow removal, ice
-19-
Case No. 9-12-13
control. We shovel sidewalks, apply de-icers, plow snow. With our
parking lots and street sweeping division, obviously we clean the
sidewalks off, pick up litter, debris, and that’s pretty much the
grounds maintenance side of it, as far as the routine maintenance
goes. With the facility maintenance and building maintenance, we
inspect lighting, repair it as needed. Potholes.
(Id. at 614). Johnson testified that the maintenance condition of the Marion Forum
Shopping Center was above average as compared to the other shopping centers
where they provide service. (Id. at 617). Johnson further testified that the
company holds weekly meetings where the maintenance crew raises any issues
they have observed and they make plans to address them. (Id. at 618-619).
Johnson testified that they train the staff on snow removal, with the goal of
making the businesses accessible and safe. (Id. at 623-624). Johnson testified that
as they clear an area, they also add salt to it. (Id. at 625). Johnson recalled that
McCardle had called his office with concerns about snow removal, and Johnson
testified that he immediately sent his crew to clear the area. (Id. at 627-628).
{¶35} Johnson testified that they respond differently to tenant calls
depending on the issue. (Id. at 629). If it is an urgent issue, they will address it
immediately. (Id.). If it is a larger or more expensive project, then they seek
approval from Wakeman before beginning the work. (Id.). Johnson denied that
-20-
Case No. 9-12-13
the lights in front of CiCi’s were out for an extended period of time, testifying that
his crew would have noticed the problem and brought it to his attention. (Id. at
630). Johnson testified that they did work on some catch basins and sewer grates.
(Id. at 632). Johnson testified that McCardle’s relationship is not good with the
people in his company, “When I was brought up, it’s the thing, you treat people
how you want to be treated. We don’t get treated- I don’t get treated how I would
like to. My guys, especially the sidewalk crew, has been treated very poorly.” (Id.
at 633-634). Johnson also testified that McCardle had complained about how the
maintenance crew was salting the sidewalk. (Id. at 636-637). Johnson testified
that he wanted to keep the tenants happy, but decided to continue salting the
sidewalk because he was concerned about safety. (Id.). Johnson testified that his
crew does spray weeds to kill them, and that they manually remove them if they
are large but leave them if they are small because they are not that unsightly. (Id.
at 647-649). Johnson denied that the maintenance crews treated the area near
CiCi’s Pizza any differently than the rest of the shopping center and further
testified that he has not had any complaints from tenants in the rest of the
shopping center. (Id. at 638- 639).
{¶36} After reviewing the evidence, we find that Lynick presented
competent, credible evidence supporting the jury’s verdict. Although the evidence
was in dispute, Lynick presented witnesses who testified that Marion Forum failed
-21-
Case No. 9-12-13
to replace burnt out lights, fix potholes, timely remove snow and ice, ensure water
was properly draining from the property, remove weeds, landscape the area near
CiCi’s Pizza, and otherwise adequately maintain the property. This evidence, if
credible, supports the jury’s conclusion that Marion Forum did not maintain the
property according to “first-class community shopping center practices” as
required by the lease. (D. Ex. T). The jury is in the best position to make these
credibility determinations. Seasons Coal Co., 10 Ohio St.3d at 80. Consequently,
we cannot find that the jury’s verdict was against the manifest weight of the
evidence.
{¶37} Marion Forum’s first and third assignments of error are, therefore,
overruled.
Assignment of Error No. II
The evidence is insufficient, as a matter of law, to support the
decision that defendant-appellee was not in default of the
contract and was not liable for damages
Assignment of Error No. IV
The evidence is insufficient, as a matter of law, to support the
decision that plaintiff-appellant was liable for damages
{¶38} In its second and fourth assignment of error, Marion Forum argues
the evidence is insufficient to support the jury’s verdict. Marion Forum admits
that it did not move for a directed verdict or judgment notwithstanding the verdict,
but contends that this case is one of the rare exceptions when plain error applies.
-22-
Case No. 9-12-13
{¶39} The plain error doctrine is not favored in appeals of civil cases.
Goldfuss v. Davidson, 79 Ohio St.3d 116, 121 (1997). The plain error doctrine
should only be applied in the extremely rare civil case “involving exceptional
circumstances where error, to which no objection was made at the trial court,
seriously affects the basic fairness, integrity, or public reputation of the judicial
process, thereby challenging the legitimacy of the underlying judicial process
itself.” Id.{¶40} We cannot find any evidence supporting Marion Forum’s assertion
that the present case involves exceptional circumstances requiring this Court to
apply the plain error doctrine. Furthermore, even if Marion Forum had made the
appropriate objections, this Court would not find that the evidence was insufficient
to support the jury’s verdict. In civil cases, “[i]f applying a sufficiency-of-the-
evidence standard, a court of appeals should affirm a trial court [if] ‘the evidence
is legally sufficient to support the [judgment] as a matter of law.’” Bryan-
Wollman v. Domonko, 115 Ohio St.3d 291, 2007-Ohio-4918, ¶ 3, quoting State v.
Thompkins, 78 Ohio St.3d 380, 386 (1997). In the present case, Lynick presented
sufficient evidence that Marion Forum failed to maintain the property according to
“first-class community shopping center practices” as required by the lease.
Consequently, we cannot find that the evidence was insufficient to support the trial
court’s judgment.
-23-
Case No. 9-12-13
{¶41} Marion Forum’s second and fourth assignments of error are,
therefore, overruled.
Assignment of Error No. V
The manifest weight of the evidence fails to establish lost profits
with sufficient certainty
{¶42} In its fifth assignment of error, Marion Forum argues Lynick failed
to establish its lost profits with sufficient certainty. Marion Forum contends that
Lynick’s accountant and expert witness did not include all of Lynick’s costs when
determining the lost profits. Marion Forum also argues that Lynick’s lost profits
could be for reasons other than the common area maintenance, such as increased
unemployment.
{¶43} Generally, a prevailing party may recover lost profits for a breach of
a contract when the “profits were within the contemplation of the parties at the
time the contract was made, the loss of profits is the probable result of the breach
of contract, and the profits were not remote and speculative and may be shown
with reasonable certainty.” Combs Trucking, Inc. v. Internatl. Harvester Co., 12
Ohio St.3d 241, 244 (1984). Evidence of the lost profits must be presented with
supporting information regarding how the profits were calculated based on facts
available or in evidence. Endersby v. Schneppe, 73 Ohio App.3d 212, 216-217 (3d
Dist.1991).
-24-
Case No. 9-12-13
{¶44} In the present case, Marion Forum acknowledged that the parties
contemplated profits when they entered into the contract as profits are the purpose
for a commercial lease. (Tr. Vol. III at 674). Howard Cannon, a restaurant
consultant and expert witness for Lynick, testified at length regarding the cause of
Lynick’s lost profits. (Id. at 448). Cannon evaluated CiCi’s Pizza and determined
that the restaurant was run very well. (Id. at 484). Cannon testified that he based
his expert opinion on his personal observations and evaluation, CiCi’s Pizza’s
corporate operation and service evaluations, CiCi’s Pizza’s quarterly revenues
from 2005 through 2010, representative sales figures for other CiCi’s Pizza
restaurants in Ohio, and the lease agreement between Lynick and Marion Forum.
(Id. at 448-470). Cannon testified that “[t]he only thing I saw that if I were the
operator, I would have been screaming and shouting about was the exterior of the
facility, which in my opinion was an F, clearly.” (Id. at 484). Cannon further
testified:
I think everyone could argue, well, everybody’s opinion of first class
may be something different, and therefore, there’s some gray area
there, but I don’t think anybody could argue potholes in the parking
lot clearly can’t be first class. Lighting being burnt out or broken
clearly can’t be first class. Signage being broke or burnt out clearly
couldn’t be first class.
-25-
Case No. 9-12-13
(Id. at 487-488). Cannon testified that a positive first impression is vital to attract
customers to a restaurant, “the determination whether to go to a restaurant happens
in a two to 32 second time frame. I mean, it’s literally that quick.” (Id. at 478-
479). Cannon testified that customers may not realize a restaurant is open if the
lighting is inadequate, and may also think that, “if you can’t have your lighting
correct or if you can’t have your parking lot correct or your signage correct,
chances are pretty good you also cannot handle my pizza or my hamburger * * *.”
(Id.). Cannon testified that, based on the poor lighting, he would not have been
surprised if customers did not realize CiCi’s Pizza was open or did not even know
the restaurant was in the shopping center. (Id.).
{¶45} Cannon also testified that the economy was not the source of
Lynick’s lost profits. According to Cannon, well operated restaurants perform
better than poorly operated restaurants during bad economic times. (Id. at 489-
490). Cannon testified that customers will continue to dine at restaurants even
when the economy is bad, but they select restaurants that are well run and
inexpensive. (Id.). Cannon testified that he would expect a restaurant such as
CiCi’s Pizza to do well during a poor economy because it was well operated and
inexpensive. (Id.). Cannon testified that the performance of the CiCi’s Pizza at
issue was unexpected because its profits were lower than comparable restaurants,
-26-
Case No. 9-12-13
even though Cannon could not find any problems with how McCardle operated the
restaurant. (Id. at 492-494). Cannon’s expert opinion was:
it is probable, more than 50 percent certainty, that [Marion Forum]’s
neglect of its common area maintenance duties to [Lynick], doing
business as CiCi’s, directly caused loss of community image,
customers in sales and this common area directly led to a loss of
between 17 and 23 percent of [Lynick]’s annual sales volume in
2008 and 2009 versus its 2007 levels. This figure represents a loss
of somewhere between $121,908 and $164,934 for each year as
stated. I’m also of the opinion that this same significant level of loss
in sales volume will continue to impact the business for a period of
between nine months and up to 18 months after all common area
maintenance obligations are brought back up to total contractual
compliance.
(Id. at 497-498).
{¶46} James Ditmars, Lynick’s certified public accountant, testified
regarding how he calculated the lost profits. (Tr. Vol. II at 245). Ditmars
presented his records reflecting that CiCi’s Pizza had annual sales of $717,003.26
in 2007. (Id. at 254-259); (D. Ex. L-2). In 2008, the annual sales declined to
$540,420.38; in 2009 declined to $486.446.98; and in 2010 sales rose to
-27-
Case No. 9-12-13
$497.330.86. (Id.); (Id.). Ditmars testified that the average sales for the first three
years CiCi’s Pizza was in business was $743,675, and the average for the last three
years, 2008 through 2010, was $508,066. (Id.); (Id.). Ditmars calculated an
average difference of $235,609. (Id.); (Id.). Based on the costs associated with
the goods CiCi’s Pizza sold, Ditmars estimated a gross profit of between 48 and
55 percent of sales. (Tr. Vol. II at 253-257). Ditmars testified that, from 2008
through 2010, CiCi’s Pizza had lost profits of between $339,277 and $409,021,
depending on the percent applied. (Id.).
{¶47} We cannot find that the evidence regarding lost profits was remote or
speculative. Lynick presented evidence that Marion Forum’s failure to properly
maintain the common area was the cause of Lynick’s lost profits through
Cannon’s expert testimony. Lynick also presented evidence regarding how the
lost profits were calculated, along with the business records to support the
testimony. We cannot find that Lynick failed to establish the lost profits with
sufficient certainty, or that the jury erred by awarding $225,000, which is less than
the award calculated by either Cannon or Ditmars. Lynick provided the jury with
documentation of its annual sales as well as all of its costs, and Marion Forum
cross examined each witness at length regarding the basis for their opinions. This
Court cannot find any evidence that the jury failed to take these factors into
account when making its judgment.
-28-
Case No. 9-12-13
{¶48} Marion Forum’s fifth assignment of error is, therefore, overruled.
Assignment of Error No. VI
The trial court erred by awarding prejudgment interest to
defendant-appellee
{¶49} In its sixth assignment of error, Marion Forum argues the trial court
erred by awarding Lynick prejudgment interest. Marion Forum contends that
there is no evidence it failed to make a good faith effort to settle pursuant to R.C.
1343.03(C), so prejudgment interest is inappropriate in this case.
{¶50} A trial court’s determination regarding whether to award
prejudgment interest is reviewed for an abuse of discretion. Lynda Hughes
Dawson Lumber, Inc. v. Hummel, 2d Dist. No. 09-CA-07, 2010-Ohio-4918, ¶ 16,
citing Damario v. Shimmel, 8th Dist. Nos. 90760, 90875, 2008-Ohio-5582, ¶ 55.
An abuse of discretion suggests the trial court’s decision is unreasonable,
arbitrary, or unconscionable. Blakemore v. Blakemore, 5 Ohio St.3d 217, 219
(1983).
{¶51} As an initial matter, we note that Marion Forum argues R.C.
1343.03(C) applies in the present case. R.C. 1343.03(C) states:
If, upon motion of any party to a civil action that is based on tortious
conduct, that has not been settled by agreement of the parties, and in
which the court has rendered a judgment, decree, or order for the
payment of money, the court determines at a hearing held
-29-
Case No. 9-12-13
subsequent to the verdict or decision in the action that the party
required to pay the money failed to settle the case, interest on the
judgment, decree, or order shall be computed * * *.
(emphasis added). The present case is based on a breach of a contract, not tortious
conduct. Consequently, R.C. 1343.03(C) is inapplicable.
{¶52} However, R.C. 1343.03 does govern a party’s right to recover
interest. Lamar Advantage GP Co. v. Patel, 12th Dist. No. CA2011-10-105,
2012-Ohio-3319, ¶ 56. R.C. 1343.03(A) provides, “when money becomes due
and payable * * * upon all judgment, decrees, and orders of any judicial tribunal
for the payment of money arising out of * * * a contract * * * the creditor is
entitled to interest * * *.”
{¶53} The Supreme Court of Ohio has held that prejudgment interest “is
compensation to the plaintiff for the period of time between the accrual of the
claim and judgment, regardless of whether the judgment is based on a claim which
was liquidated or unliquidated and even if the sum due was not capable of
ascertainment until determined by the court.” Royal Electric Construction v. Ohio
State Univ., 73 Ohio St.3d 110, 117 (1995). The Court has further stated that “[a]n
award of prejudgment interest encourages prompt settlement and discourages
defendants from opposing and prolonging, between injury and judgment,
legitimate claims.” Id. at 116-117. Prejudgment interest serves the additional
-30-
Case No. 9-12-13
purpose of making the injured party whole by compensating the party for the
period of time between the accrual of the claim and judgment. Id. at 117.
{¶54} We cannot find that the trial court abused its discretion by awarding
prejudgment interest in the present case. The trial court properly considered the
Supreme Court of Ohio’s decision in Royal Electric, and determined prejudgment
interest was appropriate for the purpose of fully compensating Lynick. (Doc. No.
96). Additionally, the trial court awarded Lynick prejudgment interest from the
time it filed its counterclaim on February 26, 2009, rather than from the date
Marion Forum initially breached its contract with Lynick. (Doc. No. 97). The
trial court thus exercised its discretion by limiting Lynick’s recovery. (Id.). As a
result, we cannot find that the trial court’s decision was unreasonable, arbitrary, or
unconscionable.
{¶55} Marion Forum’s sixth assignment of error is, therefore, overruled.
Assignment of Error No. VII
The trial court erred by assessing expert witness fees against
plaintiff-appellant as costs
{¶56} In its seventh assignment of error, Marion Forum argues the trial
court erred by awarding Lynick expert witness fees. Marion Forum contends that
the award of expert witness fees is not supported by any statutory authority or the
parties’ agreement, so the trial court’s award was an error.
-31-
Case No. 9-12-13
{¶57} Marion Forum’s lease agreement with Lynick states, “[a]ny attorney
fees incurred by a successful party to the enforcement of this Lease shall be paid
by the unsuccessful party, which shall include court costs and other reasonable
fees.” (D. Ex. T).
{¶58} We cannot find that the trial court erred in interpreting the plain
meaning of the contract to award Lynick expert witness fees as “other reasonable
fees” in addition to attorney fees and court costs. Nor can we find that the trial
court erred in determining that Lynick’s expert witness fee was an “other
reasonable fee” when expert witness testimony was required to demonstrate that
Marion Forum’s inadequate maintenance was the cause of the decline in CiCi’s
Pizza’s profits in order to recover those lost profits. Consequently, we cannot find
that Lynick’s use of an expert witness was unreasonable given the circumstances
of this case, or that the trial court erred by awarding Lynick expert witness fees in
light of the parties’ agreement.
{¶59} Marion Forum’s seventh assignment of error is, therefore, overruled.
{¶60} Having found no error prejudicial to the appellant herein in the
particulars assigned and argued, we affirm the judgment of the trial court.
Judgment Affirmed
SHAW, P.J. and WILLAMOWSKI, J., concur.
/jlr
-32-