Kingston of Miamisburg v. Maute , 2018 Ohio 2855 ( 2018 )

[Cite as Kingston of Miamisburg v. Maute, 2018-Ohio-2855.]
IN THE COURT OF APPEALS OF OHIO
SECOND APPELLATE DISTRICT
MONTGOMERY COUNTY
KINGSTON OF MIAMISBURG :
:
Plaintiff-Appellant : Appellate Case No. 27877
:
v. : Trial Court Case No. 17-CV-1394
:
KEVIN MAUTE, et al. : (Civil Appeal from
: Common Pleas Court)
Defendant-Appellee :
:
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OPINION
Rendered on the 20th day of July, 2018.
...........
W. CORY PHILLIPS, Atty. Reg. No. 0082489 and JOSEPH F. PETROS, III, Atty. Reg.
No. 0088363, 30100 Chagrin Boulevard, Suite 350, Cleveland, Ohio 44124
Attorney for Plaintiff-Appellant
GARY C. SHAENGOLD, Atty. Reg. No. 007144, 4 East Schantz Avenue, Dayton, Ohio
45409
Attorney for Defendant-Appellee
.............
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FROELICH, J.
{¶ 1} Kingston of Miamisburg appeals from a judgment of the Montgomery County
Court of Common Pleas, which granted summary judgment to Kevin and Ann Maute (“the
Mautes”) on Kingston’s claims of fraudulent transfer, promissory fraud, civil conspiracy,
promissory estoppel, and unjust enrichment. For the following reasons, the trial court’s
judgment will be affirmed.
I. Facts and Procedural History
{¶ 2} Construing the evidence in the light most favorable to Kingston, the record
establishes the following facts.
{¶ 3} Kingston of Miamisburg operates a licensed skilled-nursing facility in
Miamisburg, Ohio. On August 6, 2015, Kevin Maute’s mother, Macushla Maute, entered
into an agreement with Kingston to reside and receive services there. Macushla 1
passed away on October 26, 2015. At the time of her death, she owed a principal
balance of $11,206.77 to Kingston.
{¶ 4} According to Janet Reitz, central billing specialist for Kingston, on November
16, 2015, Kingston “sent a notice of its claim” to Ann Maute, Kevin’s wife and Macushla’s
daughter-in-law.2 On January 22, 2016, Ann “represented to [Kingston] via telephone
that she and/or the family of Macushla Maute would be opening an estate for Macushla
Maute in March or April, 2016, and that [Kingston] would be notified once an estate was
opened.” On February 15, 2016, Ann told Kingston by telephone that she had received
1 Because several individuals share the same last name, we will refer to them by their
first names for clarity.
2
An account statement showing the principal balance due is attached to Reitz’s affidavit,
but nothing labeled “notice of claim” is identified and attached to the affidavit.
Accordingly, it is unclear from the record what was sent from Kingston to Ann.
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Kingston’s “notice of its claim” and that she and/or the family “intended to pay” the claim
from Macushla’s estate. Neither Kevin, Ann, nor Kingston opened an estate in the
probate court within six months of Macushla’s death.
{¶ 5} On July 13, 2016, Kevin, the sole child of Macushla, filed an “application to
relieve estate from administration” with the Montgomery County Probate Court. The
application indicated that the estate had total assets of $24,948.47. The assets were
later transferred to Kevin. Reitz states that Kingston was not notified that an estate had
been opened, and its claim was not paid from Macushla’s estate.
{¶ 6} Counsel for the Mautes stated in his affidavit in support of summary judgment
that the docket records of the Montgomery County Probate Court do not reflect any other
estate proceedings for Macushla. Kingston alleged that it had relied on Ann’s
representations in failing to take such action.
{¶ 7} On March 20, 2017, Kingston filed an action in the General Division of the
Montgomery County Court of Common Pleas against the Mautes, alleging that the assets
of Macushla’s estate were fraudulently transferred to them. The Mautes denied the
allegations and moved for summary judgment. Kingston subsequently filed an amended
complaint, which raised claims of (1) fraudulent transfer against Kevin and Ann,
(2) promissory fraud against Ann, (3) civil conspiracy to commit promissory fraud against
Kevin, (4) promissory estoppel against Ann, and (5) unjust enrichment against Kevin and
Ann. Kingston sought damages of $11,206.77. The Mautes again denied the
allegations and renewed their motion for summary judgment.
{¶ 8} In their renewed summary judgment motion, the Mautes argued that Kingston
was trying to circumvent the six-month statute of limitations for presenting claims against
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an estate, set forth in R.C. 2117.06. They noted that, even if Kingston’s allegations were
true, Kingston had two months from Ann’s last representation to take appropriate action
to protect its claim. They further argued that no assets were transferred during
Macushla’s lifetime to trigger the applicability of R.C. Chapter 1336, the Ohio Uniform
Fraudulent Transfer Act, and that Kingston’s attempt to have the Mautes answer for the
debt of Macushla violated the Statute of Frauds.
{¶ 9} Kingston opposed the summary judgment motion. It argued that the Statute
of Frauds did not apply, because Ann promised to pay the debt from the estate’s assets,
not her own, and that the transfer of assets under R.C. Chapter 1336 includes transfers
during the probate process. Finally, Kingston argued that the Mautes presented no
evidence to create a genuine issue of material fact that they did not administer Macushla’s
estate with the intent to hinder, delay, or defraud Kingston.
{¶ 10} On August 10, 2017, a magistrate ruled in favor the Mautes, focusing on
Kingston’s obligations under R.C. 2117.06. The magistrate concluded:
In the case at bar, construing the evidence in a light most favorable
to Plaintiff, Plaintiff gave notice of its claim to a person who was not the
administrator. It is undisputed that an estate was not opened within the
six-month statutory time. It [is] also undisputed that Plaintiff at no time
initiated an estate and for the appointment of an administrator. All of
Plaintiff’s contact was with Defendant Ann Maute who was not responsible
for the bill nor has she been appointed as administrator in the estate. It
was Plaintiff’s obligation to protect its own interests. Plaintiff had no
contact with Defendants after February 2015 [sic]. With the six-month
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statute ticking away, Plaintiff still failed to initiate the filing of an estate.
As a result, Plaintiff’s claims must fail pursuant to O.R.C. 2117.06.
Defendant Ann Maulte [sic] owed no duty to Plaintiff. Plaintiff relies
on Defendant Ann Maute’s statement that an estate would be opened and
the claim paid to attempt and establish there was an attempt to hinder or
delay payment of the claim. Even if, arguably, this were true, Plaintiff’s
remedy, and in fact its obligation, was to file to open the estate itself.
Having found Plaintiff’s own inaction to be the cause of its damage, there
remains no genuine issue of material fact on Plaintiff’s claims, and
Defendants are entitled to Judgment as a matter of law.
{¶ 11} Kingston objected to the magistrate’s ruling. On January 9, 2018, the trial
court overruled Kingston’s objections, affirmed the magistrate’s findings of facts and
conclusions of law, and entered judgment in favor of the Mautes.
{¶ 12} Kingston appeals, claiming that the trial court erred in granting summary
judgment to the Mautes.
II. Summary Judgment Standard
{¶ 13} Pursuant to Civ.R. 56(C), summary judgment is proper when (1) there is no
genuine issue as to any material fact, (2) the moving party is entitled to judgment as a
matter of law, and (3) reasonable minds, after construing the evidence most strongly in
favor of the nonmoving party, can only conclude adversely to that party. Zivich v. Mentor
Soccer Club, Inc., 82 Ohio St.3d 367, 369-370, 696 N.E.2d 201 (1998). The moving
party carries the initial burden of affirmatively demonstrating that no genuine issue of
material fact remains to be litigated. Mitseff v. Wheeler, 38 Ohio St.3d 112, 115, 526
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N.E.2d 798 (1988). To this end, the movant must be able to point to evidentiary materials
of the type listed in Civ.R. 56(C) that a court is to consider in rendering summary
judgment. Dresher v. Burt, 75 Ohio St.3d 280, 292–293, 662 N.E.2d 264 (1996).
{¶ 14} Once the moving party satisfies its burden, the nonmoving party may not
rest upon the mere allegations or denials of the party’s pleadings. Dresher at 293; Civ.R.
56(E). Rather, the burden then shifts to the nonmoving party to respond, with affidavits
or as otherwise permitted by Civ.R. 56, setting forth specific facts that show that there is
a genuine issue of material fact for trial. Id. Throughout, the evidence must be
construed in favor of the nonmoving party. Id.{¶ 15} We review the trial court’s ruling on a motion for summary judgment de
novo. Schroeder v. Henness, 2d Dist. Miami No. 2012 CA 18, 2013-Ohio-2767, ¶ 42.
De novo review means that this court uses the same standard that the trial court should
have used, and we examine the evidence, without deference to the trial court, to
determine whether, as a matter of law, no genuine issues exist for trial. Ward v. Bond,
2d Dist. Champaign No. 2015-CA-2, 2015-Ohio-4297, ¶ 8.
III. Analysis
{¶ 16} Kingston raises two issues with respect to the trial court’s ruling. First, it
claims that the trial court erred in concluding that its claims were barred by R.C. 2117.06.
Second, it asserts that the trial court’s determination that Kingston did not reasonably rely
on Ann’s promises and representations was a question of fact that should not have been
resolved on summary judgment.
A. Statute of Limitations
{¶ 17} R.C. 2117.06 provides, in relevant part:
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(A) All creditors having claims against an estate, including claims arising out
of contract, out of tort, on cognovit notes, or on judgments, whether due or
not due, secured or unsecured, liquidated or unliquidated, shall present their
claims in one of the following manners:
(1) After the appointment of an executor or administrator and prior to the
filing of a final account or a certificate of termination, in one of the following
manners:
(a) To the executor or administrator in a writing;
(b) To the executor or administrator in a writing, and to the probate court by
filing a copy of the writing with it;
(c) In a writing that is sent by ordinary mail addressed to the decedent and
that is actually received by the executor or administrator within the
appropriate time specified in division (B) of this section. * * *.
***
(B) Except as provided in section 2117.061 of the Revised Code, all claims
shall be presented within six months after the death of the decedent,
whether or not the estate is released from administration or an executor or
administrator is appointed during that six-month period. Every claim
presented shall set forth the claimant’s address.
(C) Except as provided in section 2117.061 of the Revised Code, a claim
that is not presented within six months after the death of the decedent shall
be forever barred as to all parties, including, but not limited to, devisees,
legatees, and distributees. No payment shall be made on the claim and no
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action shall be maintained on the claim, except as otherwise provided in
sections 2117.37 to 2117.42 of the Revised Code with reference to
contingent claims.
***
(G) Nothing in this section or in section 2117.07 of the Revised Code shall
be construed to reduce the periods of limitation or periods prior to repose in
section 2125.02 or Chapter 2305. of the Revised Code, provided that no
portion of any recovery on a claim brought pursuant to that section or any
section in that chapter shall come from the assets of an estate unless the
claim has been presented against the estate in accordance with Chapter
2117. of the Revised Code.
{¶ 18} Kingston asserts that the trial court erred in applying the statute of
limitations in R.C. 2117.06 to bar its claims, because its claims were not claims against
Macushla’s estate but, instead, “independent claims with an independent bases for relief.”
We agree with Kingston that R.C. 2117.06 does not directly bar all of its claims. This is
not an action by Kingston against the estate of Macushla for the wrongful denial of its
claim, as a creditor of Macushla, for amounts due. And, correspondingly, Kingston is not
arguing that the probate court should allow equitable tolling of the statute of limitations
set forth in R.C. 2117.06 due to the Mautes’ actions. Rather, Kingston has brought
claims in the general division of the common pleas court against parties other than the
estate, and the claims assert wrongful acts by those parties, not the decedent or the
estate.
B. Reasonable Reliance
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{¶ 19} In its complaint, Kingston asserted claims of fraudulent transfer, promissory
fraud, civil conspiracy to commit promissory fraud, promissory estoppel, and unjust
enrichment. While these claims have different elements, they each are based on the
underlying premise that Ann made statements to Kingston upon which Kingston
reasonably relied. For promissory estoppel, Ann’s statements must have constituted a
“clear and unambiguous promise.” Mishler v. Hale, 2014-Ohio-5805, 26 N.E.3d 1260, ¶
28 (2d Dist.). “A clear and unambiguous promise is one that the promisor would expect
to induce reliance; this element is not satisfied by vague or ambiguous references.”
Hitchcock Dev. Co. v. Husted, 12th Dist. Warren No. CA2009-04-043, 2009-Ohio-4459,
¶ 24. For promissory fraud, the promise of a future action must have been made without
the present intention of performing the promise. Patel v. Univ. of Toledo, 2017-Ohio-
7132, 95 N.E.3d 979, ¶ 41 (10th Dist.).
{¶ 20} Kingston asserts that summary judgment cannot be granted on its claims,
because the reasonableness or justifiability of its reliance on Ann’s statements is a
question of fact. While we agree that reasonableness or justifiability are factual
questions, this does not mean that summary judgment can never be granted on a claim
of promissory estoppel or promissory fraud. If the factual materials, construed in the
alleged promisee’s (Kingston’s) favor, do not support a finding of reasonable or justifiable
reliance, summary judgment in the alleged promisors’ (the Mautes’) favor is appropriate.
See Mischler at ¶ 37.
{¶ 21} The reasonableness of the reliance requires an inquiry into the relationship
between the parties. Buckeye Retirement Co., LLC v. Busch, 2017-Ohio-4009, 82
N.E.3d 66, ¶ 47 (2d Dist.). We have stated with respect to fraud:
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* * * “Reliance is justifiable if the representation does not appear
unreasonable on its face and if there is no apparent reason to doubt the
veracity of the representation under the circumstances. * * * However,
reliance and responsibility must be balanced * * *.” (Citation omitted.)
Lapos Constr. Co. v. Leslie, 9th Dist. Lorain No. 06CA008872, 2006-Ohio-
5812, ¶ 21.
We stressed these points in Amerifirst Savings Bank of Xenia v.
Krug, 136 Ohio App.3d 468, 495, 737 N.E.2d 68 (2d Dist.1999). We further
noted that “ ‘[t]he rule of law is one of policy and its purpose is, while
suppressing fraud on the one hand, not to encourage negligence and
inattention to one’s own interests. There would seem to be no doubt that
while in ordinary business transactions, individuals are expected to exercise
reasonable prudence and not to rely upon others with whom they deal to
care for and protect their interests, this requirement is not to be carried so
far that the law shall ignore or protect positive, intentional fraud successfully
practiced upon the simple-minded or unwary.’ ” Id. at 495-496, 737 N.E.2d
68, quoting 50 Ohio Jurisprudence 3d, Fraud and Deceit, Section 132
(1984).
Buckeye Retirement Co. at ¶ 47-48.
{¶ 22} Although R.C. 2117.06 does not bar Kingston’s claims, the statute’s
provisions are pertinent to the obligations and reasonable expectations of the parties.
R.C. 2117.06 requires creditors of a decedent to present all claims in writing within six
months after the death of the decedent, regardless of whether the estate has been
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released from administration or an executor or administrator has been appointed during
that six-month period.
{¶ 23} The Ohio Supreme Court has strictly construed the requirements of R.C.
2117.06. In Wilson v. Lawrence, 150 Ohio St.3d 368, 2017-Ohio-1410, 81 N.E.3d 1242,
the supreme court held that a claimant did not comply with R.C. 2117.06(A) when he
delivered his claim to individuals who had not been appointed by a probate court to serve
as the executor or administrator of the estate, even though those individuals forwarded
the written claim to the executor. In so holding, the supreme court noted that the Ohio
legislature’s “commands in the statutory scheme were intended to be met with strict
compliance.” Id. at ¶ 14. The court explained:
In reaching this conclusion, we recognize that the requirements of
R.C. 2117.06 are not arbitrary ones that elevate form over substance.
Rather, they protect the vital interests of the estate and its beneficiaries, as
well as the estate’s creditors, by ensuring the orderly, efficient, and legally
proper administration of the estate by “a probate fiduciary, an officer of the
Probate Court.” Beacon Mut. Indemn. Co. v. Stalder, 95 Ohio App. 441,
445, 447, 120 N.E.2d 743 (9th Dist.1954) * * *.
***
“The statute places the burden upon the claimant to present his claim
with the probate officer.” (Emphasis sic.) Id. at 446, 120 N.E.2d 743. If a
creditor fails through indifference, carelessness, delay, or lack of diligence
to identify the administrator or executor, or to procure the appointment of
one so that a claim can be presented, the law should not come to the
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creditor’s aid. Accord Reid v. Premier Health Care Servs., Inc., 2d Dist.
Montgomery No. 17437, 1999 WL 148191, *5 (Mar. 19, 1999), citing Wrinkle
v. Trabert, 174 Ohio St. 233, 236, 188 N.E.2d 587 (1963).
(Emphasis in original.) Wilson at ¶ 15, ¶ 17.
{¶ 24} Accepting the statements in Reitz’s affidavit as true, the trial court did not
err in concluding that Kingston’s claims must fail as a matter of law. At the outset, Reitz
stated that, on November 16, 2015, Kingston sent a “notice of its claim” to Ann, the
daughter-in-law of Macushla. However, at that time, no estate for Macushla had been
opened and no effort had been made to procure the appointment of an administrator or
executor so that a claim could be presented. And even after an estate was opened, Ann
was never appointed as the executor or administrator. As a matter of law, the November
16, 2015 “notice of claim” did not meet the presentment requirements of R.C. 2117.06(A).
Instead, Kingston had simply informed Ann that Macushla had died with an outstanding
debt.
{¶ 25} Kingston’s claims are based primarily on two sets of representations that
Ann allegedly made to Kingston. First, Reitz states that Ann represented on January 22,
2016 that she or Macushla’s family would be opening an estate for Macushla in March or
April of 2016 (i.e., within six months of Macushla’s death) and would notify Kingston when
an estate was opened. Second, on February 15, 2016, Ann allegedly represented that
she had received Kingston’s claim and that she or the family “intended to pay” Kingston’s
claim from Macushla’s estate.
{¶ 26} Even if these representations had been made (which we will assume for
purposes of reviewing a summary judgment motion), Kingston has not presented any
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evidence that it could reasonably rely on any statements by Ann regarding Macushla’s
estate. It is undisputed that Ann was Macushla’s daughter-in-law; she was not an heir
of Macushla and was not, at any time, the administrator of Macushla’s estate. In other
words, there is no evidence that Ann had actual or apparent authority to speak on behalf
of the estate. Nor was there any evidence that Kingston had prior communications with
Ann regarding Macushla such that it was reasonable for Kingston to communicate with
Ann and rely on Ann’s statements regarding Macushla’s outstanding bill. Contrast Patel,
2017-Ohio-7132, 95 N.E.3d 979 (10th Dist.) (genuine issues of material fact existed about
students’ reasonable reliance on dean’s statements about accreditation when dean was
in charge of the nursing program, touted his expertise and experience in accreditation
process, and was ultimately responsible for making the formal accreditation request).
{¶ 27} Moreover, Kingston had a clear statutory obligation to present its claim
against Macushla’s estate in the manner required by R.C. 2117.06 within six months of
Macushla’s death. According to Reitz, Ann informed Kingston that the Mautes would
open an estate in March or April 2016 and notify Kingston when they did so. However,
even assuming that Ann had no intention of opening an estate within that timeframe,
Ann’s statement was not a “clear and unambiguous” promise, and nothing in Ann’s
statement reasonably relieved Kingston of its obligation to monitor the probate court’s
docket and take action to protect its own interests.
{¶ 28} Ann merely told Kingston that she or the family would be opening an estate;
she did not ask Kingston to forego opening an estate or express an intention to protect
Kingston’s interest. And, nothing in Reitz’s affidavit suggests that Kingston was offered
any inducement to forego the opening of an estate for Macushla or the procurement of
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the appointment of an administrator or executor so that its claim could be presented.
{¶ 29} The same infirmities exist with respect to Kingston’s claims based on Ann’s
February statements. Ann simply told Kingston that the family “intended to pay”
Kingston’s unpaid bill, which had been sent to the Mautes personally, out of Macushla’s
estate. Ann’s statement did not constitute a promise and did not create an obligation on
the Mautes to use assets of the estate to pay the bill. And, because Ann was not the
executor or administrator of Macushla’s estate, Ann did not -- in February 2016 or at any
time -- have any apparent or actual authority to represent how Macushla’s estate assets
would be disbursed.
{¶ 30} In short, even when construing the facts in Kingston’s favor, Kingston did
not, as a matter of law, reasonably rely on Ann’s statements when it failed to open an
estate for Macushla and properly present its claim. Consequently, Kevin did not receive
the assets from Macushla’s estate by fraud or by unjust enrichment. The trial court did
not err in granting summary judgment to the Mautes.
IV. Conclusion
{¶ 31} The trial court’s judgment will be affirmed.
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DONOVAN, J. and HALL, J., concur.
Copies mailed to:
W. Cory Phillips
Joseph F. Petros
Gary C. Schaengold
Hon. Steven K. Dankof