Schmahl v. Powers , 2013 Ohio 3241 ( 2013 )

[Cite as Schmahl v. Powers, 2013-Ohio-3241.]
Court of Appeals of Ohio
EIGHTH APPELLATE DISTRICT
COUNTY OF CUYAHOGA
JOURNAL ENTRY AND OPINION
No. 99115
SHARON SCHMAHL
PLAINTIFF-APPELLEE
vs.
MICHAEL POWERS
DEFENDANT-APPELLANT
JUDGMENT:
REVERSED AND REMANDED
Civil Appeal from the
Cuyahoga County Court of Common Pleas
Domestic Relations Division
Case No. D-310384
BEFORE: E.A. Gallagher, J., Celebrezze, P.J., and Kilbane, J.
RELEASED AND JOURNALIZED: July 25, 2013
ATTORNEY FOR APPELLANT
John V. Heutsche
John V. Heutsche Co., L.P.A.
Hoyt Block Building, Suite 220
700 West St. Clair Avenue
Cleveland, OH 44113
ATTORNEYS FOR C.S.E.A., n.k.a., CJFS-OCSS
Timothy J. McGinty
Cuyahoga County Prosecutor
By: Farah Emeka
Assistant County Prosecutor
CJFS-OCSS
P.O. Box 93923
Cleveland, OH 44101
FOR APPELLEE
Sharon Schmahl, pro se
1186 Bell Street
Chagrin Falls, OH 44022
EILEEN A. GALLAGHER, J.:
{¶1} Michael Powers appeals from the decision of the trial court dismissing his
motion to show cause and for attorney fees. Powers argues the trial court erred when it
dismissed his motions, when it sua sponte found a provision of the divorce decree
unenforceable and when it failed to allow an opportunity to file objections pursuant to
Civ.R. 53. Finding merit to the instant appeal, we reverse the decision of the trial court
and remand the matter for proceedings consistent with this opinion.
{¶2} This matter began in 2006 as a divorce action between Sharon Schmahl
and Michael Powers. It is now before this court on an appeal of the lower court’s
denial of Powers’ motions to require the CSEA (Child Support Enforcement Agency)
n.k.a. Cuyahoga County Job and Family Services to show cause why it should not be
held in contempt and for attorney fees.
{¶3} In 2009, the court filed its entry of divorce, which was signed by both
parties’ legal counsel. The entry of divorce includes the following pertinent language:
IT IS FURTHER ORDERED, ADJUDGED, AND DECREED that there
exists and the Defendant Michael P. Powers, has support arrearage in the
amount of One Hundred Seventeen Thousand Dollars ($117,000). CSEA
shall correct its records to reflect this amount of arrearage ($117,000), and
that there exists no credit toward said arrearage in the amount of One
Hundred Seventeen Thousand Dollars ($117,000); and this amount of
arrearage ($117,000) includes and takes into account any and all credits
which exist in CSEA’s records, including but not limited to, the credit in
the amount of approximately Fifty Two Thousand Dollars ($52,000).
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that the
Defendant, Michael P. Powers’ support arrearage of One Hundred
Seventeen Thousand Dollars ($117,000) shall be paid as follows:
1. Plaintiff, Sharon R. Schmahl, shall receive Thirty One Thousand
Dollars ($31,000) from the Defendant, Michael D. Powers’ one-half (1/2)
share of the joint account held by Fifth Third Bank * * * total account
balance of approximately Sixty-Two Thousand Dollars ($62,000), as set
forth below; * * *
2. On or before September 16, 2009, the Defendant, Michael P. Powers,
shall pay directly to the Plaintiff, Sharon R. Schmahl, the amount of Fifteen
Thousand Dollars ($15,000); and,
3. The remaining balance of Seventy-One Thousand Dollars ($71,000)
shall be paid by the Defendant, Michael P. Powers, continuing to pay to the
Plaintiff, Sharon R. Schmahl, the amount of One Thousand Five Hundred
Dollars ($1,500) per month, plus two percent (2)% processing fee, after the
emancipation of a child, until the arrearage in the amount of Seventy-One
Thousand Dollars ($71,000) is paid in full. The Defendant, Michael P.
Powers may at any time pay the entire balance then due and owing to the
Plaintiff, Sharon R. Schmahl, directly to the Plaintiff, Sharon R. Schmahl.
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that CSEA
shall not collect on the amount of arrearage except as set forth herein
and/or further Court Order. CSEA shall not engage in any administrative
actions to suspend the Defendant, Michael P. Powers’ professional and/or
drivers’ license(s) unless the Defendant, Micahel P. Powers fails to pay the
support and arrearages as set forth herein.
{¶4} A copy of the judgment entry was sent to CSEA who, almost immediately,
took action to collect the arrearages. CSEA sent letters to Powers informing him of
the arrearages; it sent a notice of default and added an additional twenty percent payment
obligation towards the arrearages; it intercepted Powers’ 2009 federal income tax return
and lastly; CSEA reported to the three credit reporting agencies that Powers was
delinquent on his support obligations.
{¶5} Because of CSEA’s involvement, Powers moved to add the CSEA as a
party, and the trial court granted the motion. Powers also filed motions to show cause
why CSEA should not be held in contempt and for attorney fees. After Powers properly
served both CSEA and Schmahl with the motions, the court ordered Powers and CSEA
to brief the issue of whether the court had “jurisdiction to order CSEA not to pursue
collection of support arrears owed by a party in a Domestic Relations case.” The parties
filed their respective briefs and, in a judgment entry prepared by the magistrate and
signed by the court, the court denied Powers’ motions. In particular, the court
determined that CSEA is mandated by Federal, Ohio and Administrative law to enforce
all child support orders, including the collection of arrears. The court determined that it
had no jurisdiction to order CSEA not to do that which it is mandated by law to do. The
court then found the provisions in the divorce decree ordering CSEA not to collect on
arrears to be void and unenforceable. The court determined that because it lacked
jurisdiction to order CSEA not to collect the arrears, Powers failed to state a claim upon
which relief could be granted and denied both motions.
{¶6} Powers appealed, raising the following four assigned errors:
ASSIGNMENT OF ERROR I
The trial court committed error prejudicial to Powers when it dismissed his
motions for “failure to state a claim upon which relief can be granted.”
ASSIGNMENT OF ERROR II
The trial court committed error prejudicial to Powers when it, sua sponte,
found the provision of the divorce decree “to be void and unenforceable.”
ASSIGNMENT OF ERROR III
The trial court committed error prejudicial to Powers when it denied his
motion to show cause and his motion for attorney fees.
ASSIGNMENT OF ERROR IV
The trial court committed error prejudicial to Powers when, after referring
the matter to its magistrate, circumvented Civil Rule 53 by allowing the
magistrate to prepare an “order” for the court’s approval. In doing so, it
denied Powers due process by eliminating his ability to file objections as
allowed pursuant to Civil Rule 53.
{¶7} In his first assignment, Powers finds error with the trial court’s dismissal of
his motions for failure to state a claim upon which relief can be granted. Powers
demonstrates that even though CSEA failed to raise any affirmative defenses in its brief
in opposition, the trial court determined, on its own initiative, that Powers’ motions for
contempt and attorney fees failed to state a claim upon which relief could be granted.
Powers argues that this determination was in error as CSEA never raised the affirmative
defense and his motion for contempt has merit. We agree although for different reasons
as will be articulated below.
{¶8} Initially, we note that 12(B)(6) of the Rules of Civil Procedure deals with
dismissal of complaints for failure to state a claim upon which relief can be granted, not
dismissal of individual motions. We find the trial court’s use of Civ.R. 12(B)(6)
language to dismiss Powers’ motions to show cause and for attorney fees problematic.
A normal course of review of a trial court’s Civ.R. 12(B)(6) dismissal is to conduct a de
novo review of the complaint to determine whether the dismissal was appropriate.
Monroe v. Forum Health, 11th Dist. No. 2012-T-0026, 2012-Ohio-6133.
{¶9} To apply the Civ.R. 12(B)(6) standard of review to the present case would
be entirely inappropriate. In particular, Powers’ motions to show cause and attorney
fees do not stand in a vacuum. For this court to conduct a proper review of the motions,
we are required and duty bound to review other documents in the record, including but
not limited to the divorce decree. We cannot limit our review to the “material
allegations contained in the complaint [motion]” because a review of Powers’ motions
demands a review of the remainder of the record.
{¶10} Although we note that the Rules of Civil Procedure neither expressly permit
a court to, or forbid a court from, sua sponte, dismissing complaints, we find the trial
court’s use of Civ.R. 12(B)(6) to dismiss Powers’ individual motions to show cause and
attorney fees to be in error. State ex rel. Edwards v. Toledo City School Dist. Bd. of
Edn., 72 Ohio St.3d 106, 1995-Ohio-251, 647 N.E.2d 799.
{¶11} Powers’ first assignment of error is sustained.
{¶12} We also find merit to Powers’ second assigned error in which he argues
the court was without authority to sua sponte vacate a portion of a judgment. The trial
court’s October 1, 2012 judgment entry finds void and unenforceable all provisions
ordering CSEA to not “collect on arrears.”
{¶13} Our analysis in the second assignment of error is governed by our recent
decisions in State v. Thomas, 8th Dist. No. 98377, 2012-Ohio-507; In re R.T.A., 8th Dist.
No. 98498, 2012-Ohio-5080; In re D.M., 8th Dist. No. 98633, 2012-Ohio-5422; In re
M.W., 8th Dist. No. 98886, 2013-Ohio-170. “A trial court does not have the authority
to sua sponte vacate its own final orders; rather, the trial court’s authority can come only
through a motion filed under Civ.R. 60(B).” In re R.T.A.
{¶14} In the present case, the divorce decree journalized September 30, 2009,
was a final order from which neither party filed a Civ.R. 60(B) motion for relief from
judgment nor asked the court to vacate any provision of the court’s judgment.
Accordingly, the trial court erred in its October 1, 2012 order when it sua sponte vacated
the earlier order.1
{¶15} We therefore sustain Powers’ second assigned error.
{¶16} Lastly, we find merit to Powers’ assertion that CSEA failed to comply
with a valid and enforceable court order as asserted in his first and third assigned error.
R.C. 3123.22 permits CSEA to collect an arrearage on a child support obligation unless
the obligee and obligor agree in a writing signed by the obligee and obligor and approved
by the court by journal entry that the actions taken by CSEA be limited to R.C.
3121.03(C), the collection of any federal or state income tax return.
{¶17} That is exactly what Powers and Schmahl attempted to accomplish with
pages 9 and 10 of the divorce decree. The parties attempted to limit the authority of
1
Although CSEA argues the instant case is distinguishable from the above-cited authority, we
find no merit to CSEA’s argument that the court’s September 30, 2009 journal entry was void for lack
of jurisdiction. We address this issue in the remainder of the opinion.
CSEA to collect on the arrearage because Powers and Schmahl agreed, with the court’s
consent, as to how the arrearage would be paid. Specifically, the parties agreed that
Powers’ child support obligation would remain at $1,500 for each of his two children and
that Powers would continue to pay that $1,500 per month, per child even after the
children reached the age of majority, until the arrearage of $71,000 was paid in full.
{¶18} We note that the divorce decree makes no mention of CSEA’s authority
to seize Powers’ income tax returns and, that Powers initially objected to the seizure of
his 2009 federal tax return. Nonetheless, during oral argument before the court, Powers
acknowledged that CSEA was within its authority to seize the return, that it was a proper
exercise of authority and that he was no longer objecting to the seizure.
{¶19} It is clear from the intent of the divorce decree that the parties agreed on
both the amount of child support owed and the manner of repayment. It is also equally
clear that the parties intended to limit the CSEA’s authority to collect on that arrearage
unless, and until, Powers failed to pay as outlined in the agreement. This is the exact
fact scenario governed by R.C. 3123.22 and thus, we find that R.C. 3123.22 applies in
the present case.
{¶20} We find no merit to the trial court’s conclusion that it was without
jurisdiction to order CSEA not to collect on the arrearages. R.C. 3123.22 provides a
vehicle to deviate from CSEA’s standard methodology of collecting arrearages, which is
what the parties agreed to with the court’s approval. Powers is not arguing or
advocating for the court to order CSEA not to collect arrearages, he is simply advocating
for compliance with the agreed-upon order. Therefore, we find that the trial court erred
in determining (1) that it lacked jurisdiction and (2) that the portions of the judgment
entry dealing with the collection of arrearages were void.
{¶21} Based on the foregoing, Powers’ first, second and third assignments of
error are sustained. Our analysis of the first three assigned errors renders Powers’
fourth and final assignment of error moot. The judgment of the trial court is reversed
and the case is remanded for a hearing on Powers’ motions for contempt and for attorney
fees.
{¶22} Judgment reversed and the cause remanded for further proceedings
consistent with this opinion.
It is ordered that appellant recover of said 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 lower 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.
EILEEN A. GALLAGHER, JUDGE
MARY EILEEN KILBANE, J., CONCURS;
FRANK D. CELEBREZZE, JR., P.J., CONCURRING
IN PART AND DISSENTING IN PART (WITH
SEPARATE OPINION)
FRANK D. CELEBREZZE, JR., P.J., CONCURRING IN PART AND DISSENTING
IN PART:
{¶23} I concur in the resolution of appellant’s first assignment of error, but
dissent with the rest of the majority opinion. I disagree with the holding that R.C.
3123.22 applies to limit CSEA’s ability to collect child support arrearages in this case.
{¶24} R.C. 3123.22 provides a specific mechanism to allow parties to work out
an agreement about how child support arrearages will be paid. It provides in part that
if an obligor is paying off an arrearage owed under a support order
pursuant to a withholding or deduction notice or order issued under section
3121.03 of the Revised Code, a support order newly issued or modified, or
any other order issued to collect the arrearage, the child support
enforcement agency administering the notice or order may also take any
action * * * to collect any arrearage amount that has not yet been collected
under the notice or order, unless the obligee and obligor agree in a writing
signed by the obligee and obligor and approved by the court by journal
entry that the additional actions be limited to [the collection of federal and
state tax refunds] * * *.
(Emphasis added.)
{¶25} The majority opinion indicates the parties intended to invoke R.C.
3123.22 to limit CSEA’s ability to collect the arrearage. The parties failed to invoke
R.C. 3123.22 to limit CSEA’s role.
{¶26} The intentions of the parties may be discerned “by use of the rules of
construction, the language of the contract, the subject matter of the contract, the parties’
respective situations, the circumstances surrounding the transaction * * *, and the
conduct of the parties that demonstrates the construction they themselves placed upon
the contract.” (Emphasis added.) Newell v. Marc W. Lawrence Bldg. Corp., 5th Dist.
Case No. 94-CA-292, 1995 Ohio App. LEXIS 3595, *5-6 (May 8, 1995), citing Toledo
Police Patrolmen’s Assn. v. Toledo, 94 Ohio App.3d 734, 740, 641 N.E.2d 799 (1994),
citing Huntington & Finke Co. v. Lake Erie Lumber & Supply Co., 109 Ohio St. 488, 143
N.E. 132 (1924).
{¶27} The failure to invoke R.C. 3123.22 is demonstrated by the contract
provision and Powers’s motion to show cause itself. The contract provision in the
divorce decree attempts to wholly prevent CSEA from attempting to satisfy the
arrearage. In Powers’s show cause motion, he argued in part that CSEA was in
contempt because it intercepted his tax returns. Neither Powers nor the court has any
authority to limit CSEA’s ability to intercept federal and state tax returns as a means of
satisfying child support arrearages. The court order limiting CSEA’s ability to collect
child support arrearages is invalid as beyond the court’s authority to grant. The
majority overlooks this required language and rewrites the provision of the decree to
incorporate it. This court has no authority to rewrite this provision of the divorce
decree, and the trial court has no authority to require CSEA to comply with the invalid
provision. “Courts apply clear and unambiguous contract provisions without regard to
the relative advantages gained or hardships suffered by parties. * * * Courts may not
rewrite clear and unambiguous contract provisions to achieve a more equitable result.”
(Citations omitted.) Cent. Allied Enters. v. Adjutant Gen. Dept., 10th Dist. No.
10AP-701, 2011-Ohio-4920, ¶ 19.
{¶28} The provision in the divorce decree attempting to wholly limit CSEA’s
ability to collect on the arrearage is invalid. R.C. 3123.22 does not apply to the present
situation because the language in the decree did not comply with this statute. However,
the procedural mechanism used by the magistrate and trial court to dismiss the case,
including the magistrate’s failure to issue a decision for the trial court to review, as set
forth in Powers’s fourth assignment of error, was improper. I therefore concur that the
case must be remanded to the trial court, but I find no error in the magistrate and trial
court’s logic that the provision of the divorce decree wholly limiting CSEA’s ability to
collect child support arrearages is invalid and void.