Zimmerview Dairy Farms, L.L.C. v. Protege Energy III., L.L.C. , 2022 Ohio 1282 ( 2022 )

[Cite as Zimmerview Dairy Farms, L.L.C. v. Protege Energy III., L.L.C., 2022-Ohio-1282.]
IN THE COURT OF APPEALS OF OHIO
FOURTH APPELLATE DISTRICT
WASHINGTON COUNTY
ZIMMERVIEW DAIRY FARMS, :
LLC, ET AL., :
: Case No. 21CA1
Plaintiffs-Appellees, :
:
v. : DECISION AND JUDGMENT
: ENTRY
PROTÉGÉ ENERGY III :
LLC, :
:
Defendant-Appellant. :
_____________________________________________________________
APPEARANCES:
J. Kevin West, Dallas F. Kratzer, III, Steptoe & Johnson PLLC, Columbus,
Ohio, Robert L. Paddock, Buck Keenan LLP, Houston, Texas, Pro Hac
Vice, for Appellant.
Matthew C. Carlisle, Adam J. Schwendeman, Thiesen Brock, LPA,
Marietta, Ohio, for Appellees.
_____________________________________________________________
Smith, P.J.
{¶1} Defendant-Appellant Protégé Energy III LLC, “Protégé,”
appeals the December 18, 2020 Decision and Judgment Entry of the
Washington County Court of Common Pleas. Protégé conducted gas and oil
operations on property owned by Plaintiffs-Appellees Zimmerview Dairy
Farms, LLC and Zimmerview Properties, LLC, collectively “Zimmerview,”
Washington App. No. 21CA1 2
in 2015. Later, Zimmerview brought various claims against Protégé,
including breach of contract, conversion, and trespass.
{¶2} After a bench trial, the trial court found in favor of Zimmerview
and awarded Zimmerview $819,093.00 on the above claims. Protégé
challenges the trial court’s findings on Zimmerview’s claims and the
damage awards. However, based upon basic principles of contract law in
Ohio and our review of the evidence presented at trial, we find no merit to
the arguments offered in Protégé’s five assignments of error. We find there
is competent and credible evidence to support the trial court’s judgment in
this matter. Accordingly, we overrule all assignments of error and affirm the
judgment of the trial court.
FACTUAL AND PROCEDURAL BACKGROUND
{¶3} The following facts were adduced at a bench trial in the
Washington County Court of Common Pleas on September 29, 2020. Dean
Zimmer and his brother Brent Zimmer are the members of Zimmerview
Dairy Farm, LLC. Zimmerview owns land and maintains a farming
operation at 700 Zimmer Road in Washington County. The farm has been in
the Zimmer family since 1926. Dean Zimmer has worked the family farm
his entire life, and before that, his father and grandfather worked and
managed the farm. The farm started out as a dairy farm, switched to beef,
Washington App. No. 21CA1 3
and currently is a beef-feeding operation. The Zimmers grow corn,
soybeans, hay, and alfalfa.
{¶4} In January 2014, Dean Zimmer, on behalf of Zimmerview, and
MNW Energy LLC, entered into an Oil and Gas Lease. James Vuksic, who
testified at trial, owned shares in MNW Energy LLC. The Oil and Gas
Lease was eventually assigned to Protégé.
{¶5} Tarah Fagan represented Protégé’s interests in the subsequent
contract negotiations. Due to difficulty in the negotiations, Dean Zimmer
asked James Vuksic to mediate the contract negotiations. Vuksic had
assisted Protégé with negotiations in the past. Vuksic has been involved in
the oil and gas industry for 30 to 40 years. In addition to the original Oil and
Gas Lease, the parties eventually entered into three additional contracts:
1. The Supplemental Agreement of the Parties;
2. The Surface and Subsurface Use Agreement1; and,
3. The Damage Release Agreement.
The above four contracts were admitted as joint exhibits at trial. Additional
information regarding the pertinent contract negotiations will be set forth
below.
1
Testimony indicates the Surface and Subsurface Use Agreements simply provided for an easement to
construct the well pad on the Zimmerview property.
Washington App. No. 21CA1 4
{¶6} Protégé used 13.5 acres of the Zimmer farm during construction
of what became known as the Caywood well pad, five for the well pad and
8.5 for the hillside. Core drilling began in January 2015. Brush and tree
removal began in March 2015. Fences were constructed in April 2015.
Topsoil removal began in May 2015. Huge trucks moved the topsoil to a
stockpile at an agreed-upon location.
{¶7} In June 2015, there were multiple extremely heavy rains. Dean
Zimmer identified a photo exhibit showing the extreme runoff of brown
water which took topsoil with it. The topsoil ran into a creek which
bordered the Zimmer farm. Dean Zimmer identified several photographs
which showed how the hillside looked after every rain with the topsoil
stockpile running downhill.
{¶8} Protégé hired Great Lakes Construction Company, “Great
Lakes,” to re-seed the area. However, the rains washed the seed away and
gullies formed. During these efforts, topsoil was not replaced. The topsoil
continued to flow downhill. There were three initial attempts to re-seed the
hillside.2 Each time the rains washed the seed away and gullies formed.
2
Protégé witness Brian Plautz testified that hydroseeding is the process of applying grass seed and fertilizer
mixed together with water to slopes using a truck.
Washington App. No. 21CA1 5
{¶9} Mr. Zimmer and his brother spoke to Protégé’s CEO about their
concerns in August 2015. Great Lakes left the site in early fall 2015, leaving
some gullies behind. Within a month or two, Zimmer testified there were
four-foot canyons and gullies running through the hillside. Zimmer also
testified that large boulders were left behind.
{¶10} The Zimmers also contacted the Ohio Department of Natural
Resources, “ODNR.” ODNR inspected the well pad area and issued a notice
to Protégé that they needed to reclaim the area.3 On the fourth attempt at
reclamation, Protégé used a company called Hydrogreen.
{¶11} Hydrogreen repositioned some of the boulders and moved them
into piles. Hydrogreen “tracked” the rough spots in the gullies and sprayed
the hillside again. Hydrogreen left in June 2016. After the first rain, the
gullies reappeared even deeper. Zimmer testified that gullies create
problems in farming because animals can get hurt and because it is
dangerous to use farm or heavy equipment near gullies.
3
Oil and gas reclamation begin long before the completion of operations at an oil and gas site. Rather it is
an ongoing process, beginning before site construction and continuing through the life of an oil and gas
production well and its associated facilities. Following reclamation, an inspector checks for proper re-
contouring of the site, the return of topsoil to disturbed areas, and completion of proper re-seeding.
Reclamation is successful when it has established a self-sustaining, vigorous, diverse, native plant
community that will control erosion and non-native plant invasion. See U.S.Department of the Interior,
Bureau of Land Management, Reclamation. https://www.blm.gov/programs/energy-and-minerals/oil-and-
gas/reclamation. Accessed December 14, 2021.
Washington App. No. 21CA1 6
{¶12} When Protégé left the jobsite, erosion and landscaping issues
still existed.4 Protégé left parts of fence behind. Both water and telephone
lines were exposed. There was unsightly vegetation. Mr. Zimmer described
the well pad area as an “inconvenience and an eyesore.”
{¶13} Zimmer testified he had to remove a three-strand fence placed
by the contractors. When cattle attempted to go through the fence they were
injured. Zimmer testified the water line was exposed four to five hundred
feet. Prior to the construction, Zimmer never had Marestail, “an invasive
weed that spreads extremely fast.” He testified the weeds do not hold the
topsoil. Zimmer testified the property was not usable for farming.
{¶14} Through their attorney, the Zimmers made Protégé aware of the
issues with the condition of the property. Protégé sent Dean Zimmer a
check but Zimmer was advised to send it back. Subsequently, Zimmerview
filed its complaint against Great Lakes and Protégé for breach of contract,
conversion, trespass, additional trespasses, and misappropriation of images
and intellectual property on September 20, 2018. Protégé filed an Answer
denying all claims.5
4
One of Protégé’s witnesses, Benjamin Wright, testified that water running across bare soil causes it to
move or “erode.” A “slip” is when water saturates a slope to the point that the soil becomes too heavy to
stay on a slope and then a large chunk of soil breaks off the slope.
5
Great Lakes was later dismissed from the action. Furthermore, the claims for additional trespasses,
misappropriation of images and intellectual property were also dismissed.
Washington App. No. 21CA1 7
{¶15} Protégé filed a motion for summary judgment which was
denied.6 The parties proceeded to a bench trial on September 29, 2020.
Zimmerview presented the in-person testimony of several witnesses: Dean
Zimmer, James Vuksic, William “Billy” H. Burkhart II, and Larry Lang. As
indicated above, the contracts the parties entered were stipulated as joint
exhibits. In addition, Zimmerview offered Exhibits 1-55 into evidence.
Protégé did not oppose the admission of these exhibits. The 55 exhibits
included letters to Protégé; photographs of invasive weeds after the
Hydroseed application in 2016; photographs of the Zimmer property in
January and September 2020; estimates provided by Billy Burkhart and
Larry Lang; a photograph of the topsoil stockpile; and Dean Zimmer’s out of
pocket expenses.
{¶16} Protégé did not present witnesses in person at trial, but instead
relied on depositions of the following persons: Jason Pugh, Brian Plautz,
Benjamin Wright, and Tarah Fagen.7 Jason Pugh is a petroleum engineer.
6
Zimmerview also filed a motion to join an additional party, Verdun Oil Company, LLC, under Civ.R. 19, a
motion which the trial court granted. However, the record does not reflect that Verdun was subsequently
served and made a party to the proceedings. In State e x rel. Gill v. Winters, 68 Ohio App.3d 497, 589
N.E.2d 68, 73, (4th Dist.1990), this court noted that pursuant to Civ.R. 19(A), the trial court is “vested with
a substantial amount of discretion in determining whether a party is necessary in the sense that in his
absence complete relief cannot be afforded among those already parties.” This court further emphasized
the mandatory language of Civ. R. 19(A). The docket in this case demonstrates that Verdun Oil Company,
LLC was never served and made a party. Neither party has addressed this on appeal. In Gill, this court
also pointed out that joinder may be waived. Given that Zimmerview has not addressed this issue, we
conclude the failure to join Verdun Oil Company, LLC, as ordered by the trial court, has apparently been
waived.
7
Tarah Fagen’s deposition was a discovery deposition while the others were evidentiary depositions. As
observed by the appellate court in the 10th district, we are cognizant that Civ.R. 32, which governs the use
Washington App. No. 21CA1 8
He was previously employed by Protégé as operations manager. He was
responsible for gas production, operations, oil and gas well completion, and
any kind of surface construction that was required for oil and gas operations.
{¶17} Pugh testified that when Great Lakes excavated the hillside,
boulders “popped out.” The workers tried to break them up into smaller
pieces and make them part of the material. Some were removed to a
particular area on the site at Mr. Zimmer’s direction. Protégé also repaired
erosions and “slips,”8 the main issues relating to the well pad. Protégé
monitored and fixed these issues as needed. These issues were expected
surface and subsurface damages.
{¶18} Brian Plautz holds a degree in civil engineering. He was
project manager for Great Lakes Construction Company. Plautz’s job
entailed controlling the documentation and financial aspects of the project.
Plautz testified he was familiar with oil and gas operations at Zimmerview.
He visited the construction site once every two weeks. He testified that at
the end of Great Lakes’ work, there were no extraordinary or unusual issues
with erosions or slips, re-planting or re-seeding, or rocks and boulders.
of depositions, does not distinguish between discovery depositions and evidentiary depositions. See Fifth
Third Bank of Columbus v. Margolis Family Ltd. Partnership, 10th Dist. Franklin No. 97APE-05-693,
1997 WL 770966, at *4. “However, where * * * the credibility of the witness is a vital factor, the use of a
pretrial discovery deposition ‘is an inadequate substitute for the presence of that witness.’ ” Id. quoting
Loinez v. E.G. & G., Inc. (C.A.1 1990), 910 F.2d 1, 8.
8
Pugh testified a slip is where an embankment fails and the material of the embankment becomes dislodged
because of a weak point.
Washington App. No. 21CA1 9
Furthermore, neither Protégé nor Zimmerview informed Great Lakes that
they were not satisfied with Great Lakes’ work.
{¶19} Benjamin Wright holds degrees in environmental science and
watershed management. He is owner and manager of Hydrogreen. Wright
testified he was familiar with aspects of the oil and gas operations at
Zimmerview. However, he was on the site only twice.
{¶20} Tarah Fagen testified she holds a degree in energy management
and finance from the University of Oklahoma. Ms. Fagen is vice president
of land for Protégé. Fagen testified she manages the leasing negotiations,
pre-drilling, and title work. She also handles land owner complaints relating
to ongoing operations. Fagen testified she worked with a team which
included Jason Pugh. Fagen was familiar with the Zimmer well pad.
{¶21} After hearing the evidence presented by the parties, the trial
court granted judgment in favor of Zimmerview and against Protégé on the
breach of contract, conversion, and trespass claims. On the breach of
contract claim for failing to properly reclamate the Zimmer property, the
trial court awarded damages in the amount of $349,093.00. On the claim for
conversion of topsoil, the trial court awarded $450,000.00. On the claim for
breach of contract/trespass relating to the Zimmers’ lack of access to their
Washington App. No. 21CA1 10
property, the court awarded $20,000.00. This timely appeal followed.
Additional facts will be set forth where pertinent.
ASSIGNMENTS OF ERROR
I. THE TRIAL COURT ERRED BY FINDING
PROTÉGÉ HAD A CONTINUING DUTY TO
REMEDY DAMAGES THAT WAS NOT PART
OF THE PARTIES’ AGREEMENTS.
II. THE TRIAL COURT ERRED BY GIVING
“CLEAN-UP OPERATIONS” AND
“EXTRAORDINARY OR UNUSUAL”
DAMAGES DEFINITIONS THAT RENDERED
OTHER PARTS OF THE PARTIES’
AGREEMENTS MEANINGLESS.
III. THE TRIAL COURT ERRED IN FINDING FOR
ZIMMERVIEW ON ITS BREACH OF
CONTRACT AND CONVERSION CLAIMS
RELATED TO TOPSOIL.
IV. THE TRIAL COURT ERRED IN DETERMINING
THE AMOUNT OF DAMAGES TO AWARD
ZIMMERVIEW BECAUSE IT DID NOT APPLY
THE PROPER MEASURE OF DAMAGES AND
RELIED ON SPECULATION.
V. THE TRIAL COURT ERRED BY FINDING
PROTÉGÉ HAD BREACHED ITS AGREEMENT
WITH ZIMMERVIEW BY FAILING TO PAY
ADDITIONAL RENTS, BY IGNORING THE
PLAIN LANGUAGE OF THE AGREEMENT
AND RELYING ON EXTRINSIC EVIDENCE.
STANDARD OF REVIEW FOR
CONTRACT INTERPRETATION
Washington App. No. 21CA1 11
{¶22} This appeal involves questions regarding interpretation of the
contracts which governed the relationship and work of the parties. Legal
issues involving contract interpretation are subject to a de novo standard of
review. See S. P. Drilling Services Inc. v. Cooper Excavating, LLC, 4th
Dist. Adams No. 17CA1058, 2019-Ohio-55, at ¶ 14; Taylor Bldg. Corp. of
Am. v. Benfield, 117 Ohio St.3d 352, 2008-Ohio-938, 884 N.E.2d 12, ¶ 37.
See also Wiltberger v. Davis, 110 Ohio App.3d 46, 51-52, 673 N.E.2d 628(1996).
{¶23} Further, when a trial court makes factual findings supporting its
legal conclusions regarding a contract, those factual findings must be
reviewed with great deference and upheld if some competent credible
evidence exists to support them. See S.P. Drilling Services Inc. at ¶ 14;
Taylor at ¶ 38, and Wiltberger at ¶ 52. “The underlying rationale of giving
deference to the findings of the trial court rests with the knowledge that the
trial judge is best able to view the witnesses and observe their demeanor,
gestures and voice inflections, and use these observations in weighing the
credibility of the proffered testimony.” GM Gas Exploration, Inc. v
McClain, 4th Dist. Athens No. 1438, 1991 WL 163644 (Aug. 13, 1991), at
*2. In our review, we look to see if the facts and the resulting judgment are
both supported by the weight of the evidence. Patton v. Patton, 4th Dist.
Washington App. No. 21CA1 12
Adams No. 01CA712, 2001-Ohio-2599, *2. Furthermore, appellate courts
will not reverse judgments as being against the weight of the evidence when
those judgments are supported by some competent and credible evidence.
Id. (internal citations omitted).
I. THE TRIAL COURT ERRED BY FINDING PROTÉGÉ
HAD A CONTINUING DUTY TO REMEDY
DAMAGES THAT WAS NOT PART OF THE
PARTIES’ AGREEMENTS.
II. THE TRIAL COURT ERRED BY GIVING “CLEAN-UP
OPERATIONS” AND “EXTRAORDINARY OR
UNUSUAL” DAMAGES DEFINITIONS THAT
RENDERED OTHER PARTS OF THE PARTIES’
AGREEMENTS MEANINGLESS.
LEGAL ANALYSIS
{¶24} Because we find these assignments of error to be interrelated,
we consider them jointly. The trial court found that Protégé had a
continuing duty to fix and repair gully and erosion issues. The court further
determined that cleanup operations encompassed activities which occurred
in the process of returning the land to Zimmerview in a similar condition as
it was prior to construction, and that the failures in cleanup operations led to
the current damaged state of the property. Thus, the court awarded
judgment in favor of Zimmerview and against Protégé in the amount of
$349,093.00, plus interest, due to Protégé’s breach of contract for failure to
Washington App. No. 21CA1 13
properly reclamate and return the property to Zimmerview in a similar
condition as prior to construction of the well pad.
{¶25} Under the first assignment of error, Protégé contends that
neither the Oil and Gas Lease, nor the Damage Release Agreement contain
provisions creating a continuing duty to correct erosion issues. Protégé
asserts that the trial court went outside of the plain language of the
agreements to “invent” a continuing duty to remedy damages caused to the
Zimmerview property. According to Protégé, the trial court then concluded
that Protégé had breached its agreements with Zimmerview by failing to
fulfill the “newly-invented duty.” Protégé asserts the trial court thereby
erred as a matter of law.
{¶26} Under the second assignment of error, Protégé argues that the
trial court erred with regard to its interpretation of “cleanup operations” and
“extraordinary” or “unusual” damage, as contained in the Damage Release
Agreement. At trial, Zimmerview argued that Protégé failed to clean up the
property after it concluded oil and gas operations and that the remaining
damages were “extraordinary or unusual.” Protégé contends that the trial
court erred by its interpretation of “extraordinary or unusual,” and then by
relating these terms to the trial court’s “newly-created duty.” Protégé argues
that this court should find that Zimmerview is not entitled to damages under
Washington App. No. 21CA1 14
the “clean-up operations” and “extraordinary or unusual” provisions of the
Damage Release Agreement.
{¶27} “ ‘In construing a written instrument, the primary and
paramount objective is to ascertain the intent of the parties so as to give
effect to that intent.’ ” Lang, supra, at ¶ 17, quoting Shafer v. Newman Ins.
Agency, 4th Dist. Highland No. 12CA11, 2013-Ohio-885, at ¶ 10, citing
Aultman Hosp. Assn. v. Community Mut. Ins. Co., 46 Ohio St.3d 51, 53, 544
N.E.2d 920 (1989). “ ‘When the terms of a contract are unambiguous,
courts will not, in effect, create a new contract by finding an intent not
expressed in the clear language employed by the parties.’ ” Waina v.
Abdallah, 8th Dist. Cuyahoga No. 86629, 2006-Ohio-2090, at ¶ 31, quoting
Shifrin v. Forest City Ents., 64 Ohio St.3d 635, 597 N.E.2d 499 (1992).
“ ‘Courts must give common words their ordinary meaning unless manifest
absurdity would result or some other meaning is clearly evidenced from the
face or overall contents of the written instrument.’ ” Shafer at ¶ 10, quoting
In re All Kelley & Ferraro Asbestos Cases, 104 Ohio St.3d 605, 2004-Ohio-
7104, 821 N.E.2d 159, ¶ 29.
{¶28} “ ‘If a contract is clear and unambiguous, the court need not go
beyond the plain language of the agreement to determine the parties' rights
and obligations; instead, the court must give effect to the agreement's
Washington App. No. 21CA1 15
express terms.’ ” Lang, supra, at ¶ 18, quoting Uebelacker v. Cincom Sys.,
Inc., 48 Ohio App.3d 268, 271, 549 N.E.2d 1210 (1st Dist.1988).
“Ambiguity exists only when a provision at issue is susceptible of more than
one reasonable interpretation.” Lager v. Miller–Gonzalez, 120 Ohio St.3d
47, 2008-Ohio-4838, 896 N.E.2d 666, ¶ 16. “Extrinsic evidence is
admissible to ascertain the intent of the parties only when the contract is
unclear or ambiguous, or where surrounding circumstances give plain
language special meaning.” Highland Drilling, Inc. v. McAlester Fuel Co.,
4th Dist. Washington No. 99CA08, 1999 WL 1058785, *3 (Nov. 16, 1999).
{¶29} As indicated, the trial court specifically found a continuing duty
to repair the erosion issues on the Zimmerview property. Paragraph 31 of
the Oil and Gas Lease provides:
Surface Restoration: Removal of Lessee’s Property.
Lessee shall construct or install all well sites, access roads,
pipelines, structures and other facilities, in a manner that
would reasonably minimize any related soil erosion.
Should Lessee materially damage any part of the surface,
* * *, it is expressly agreed and understood that Lessee
shall use commercially reasonable efforts to repair and
restore such damaged portion of the surface of the Leased
Premises as nearly as practicable to the condition in
which said land existed before the commencement of
operations within one hundred eighty (180) days after well
completion or pipeline installation. (Emphasis added.) * *
* All restoration work shall be done at the sole expense of
Lessee.
{¶30} Paragraph Five of the Damage Release Agreement
Washington App. No. 21CA1 16
provides:
Grantor does hereby discharge and release Grantee, * * *,
from all actions, causes of actions, suits, claims and
demands whatsoever for and on account of any damages
to the appurtenances to the Property or to growing crops
or timber thereon; for and on account of any interference
with livestock operations caused by or as a result of
Grantee’s exploration and drilling for and operation and
production of oil and gas and related substances; and any
surface and subsurface damages caused by or incurred in
connection with the construction of the [well pad at issue].
{¶31} In response to the first assignment of error, Zimmerview asserts
that the Oil and Gas Lease is ambiguous as to Protégé’s agreement to restore
the property using commercially reasonable efforts. Therefore, the trial
court did not err when it admitted extrinsic evidence and, based on the
evidence, found a continuing duty to repair the property. For the reasons
which follow, we agree with Zimmerview.
{¶32} We start by examining the testimony the trial court heard on the
above issues. Dean Zimmer testified that shortly after the Oil and Gas Lease
was signed Protégé wanted to put a well pad on his property so discussions
ensued. Zimmer insisted on a Supplemental Agreement because he did not
want the well pad on his property. Zimmer testified that initially the parties
could not agree where the well pad was to be located. He later agreed to the
requested location with multiple stipulations because the location was “in
Washington App. No. 21CA1 17
the middle of good property,” and very close to Zimmer’s personal
residence.
{¶33} Dean Zimmer also testified that early on negotiations “broke
down” with Protégé’s representative, Tarah Fagan. Zimmer asked James
Vuksic to mediate. Mr. Zimmer testified at length as to his expectations that
the Zimmerview property would be fully restored after the well pad was
constructed. Mr. Zimmer testified:
The number one agreement we - - stressed very strongly
from day one, was we want it to look nice and be able to
go back and be able to farm like it was before, and after
the well had - - you know, was finished. Our family,
neighbors, whatever, I think kind of everybody in the area
takes pride in the looks of our farm, and we do too, and we
work hard at it. And we didn’t want the well to be an
eyesore.
{¶34} Mr. Zimmer testified the land around the pad never had erosion
issues or water drainage issues before the pad construction. There were no
issues with invasive vegetation. He testified, “It was lush grass, pasture.
* * * And it was very fertile.”
{¶35} Mr. Zimmer testified that the landscaping was the subject of
Paragraph 11 of the Oil and Gas Lease. He requested that trees be planted to
block the view of the well pad and tanks. Mr. Zimmer reiterated, “[W]e
wanted it returned to look good and be farming and usable, very usable
property.”
Washington App. No. 21CA1 18
{¶36} Mr. Zimmer testified he does not like looking at the well pad
outside his back window. He is no longer able to use the five acres where
the well pad is located. Rocks and boulders were left in the area after
construction ceased.
{¶37} Jason Pugh, Protégé’s project manager at the time, testified he
was familiar with the Oil and Gas Lease between Protégé and Zimmerview.
Pugh testified that he “provided limited input on certain terms but did not
negotiate” the Oil and Gas Lease, the Supplemental Agreement, the Surface
Use Agreement, and the Damage Release Agreement. He testified his role
was to “opine to our land department about the terms we could and couldn’t
agree to.” Pugh identified the Damage Release Agreement and testified that
this agreement released Protégé from damages incurred as a result of oil and
gas operations on the site. The Damage Release Agreement did not stipulate
any particular work to be performed.
{¶38} Generally, Pugh testified that Protégé agreed to restore the
slopes on the Zimmerview property as part of the Supplemental Agreement,
and that Protégé had fulfilled this requirement. He identified the final as-
built survey performed by Great Lakes after construction was substantially
completed. He testified the slopes conformed with what Protégé agreed to
do and there were no unusual issues.
Washington App. No. 21CA1 19
{¶39} Pugh testified that after the construction was complete, Protégé
“continued to maintain any instances of erosion * * * until the site was
completely vegetated and re-seeded.” Pugh also identified the Daily Reports
prepared by the construction inspector. The reports documented erosions
located on the property and recorded efforts to mitigate and manage the
erosions until the construction was complete. Pugh testified that the reports
reflected that re-seeding and re-planting was performed as required.
{¶40} Pugh testified there are unique aspects about every job and well
pad. In this case, it took several re-seeding attempts to get the grass to grow.
He explained that a bare hillside exposed to weather conditions is more
susceptible to erosion.
{¶41} Pugh also identified a notice from the ODNR regarding erosion
issues that needed remedied. Pugh testified they repaired the issues as
required. Great Lakes used Penn Line twice to do the re-seeding. The first
seeding in July 2015 did not establish well so Penn Line returned, as a
warranty repair, and re-seeded parts of the side that did not germinate.
{¶42} Pugh testified Protégé hired Hydrogreen because seed on the
south slope did not establish and was causing erosion issues of the topsoil as
documented by the ODNR. Protégé developed a restoration plan with
Hydrogreen. Hydrogreen performed the re-seeding work in April 2016.
Washington App. No. 21CA1 20
Pugh identified Hydrogreen Daily Reports which documented the re-seeding
and re-planting efforts performed by Hydrogreen. Pugh testified
Hydrogreen was successful in re-planting and re-seeding. None of the slips
were extraordinary or unusual issues. Protégé satisfied the obligation of the
ODNR demand letter. Pugh identified Exhibit D10, pictures of the well pad
site taken in Spring 2016, which documented Hydrogreen’s work. He
testified there were no erosions or slips in the pictures because they had been
remedied before or during the operation.
{¶43} Pugh testified that the rocks or boulders were moved as directed
by Mr. Zimmer. He testified there were no issues with rocks or boulders
considered to be extraordinary or unusual. Pugh admitted that possibly large
rocks were missed during the final cleanup operations and left behind in the
embankment. Pugh testified Protégé did leave telephone or waterlines
exposed, however, Protégé did not have an agreement making it responsible
to bury the lines.
{¶44} Exhibit D9 was the final punch list kept in the course of
Protégé’s business. Pugh described the cleanup efforts in detail. Pugh
testified all the items were completed and he initialed the document. Pugh is
not aware of any erosion happening after the site was re-seeded in spring
2016. The last time Pugh was at the Zimmerview property was April 12,
Washington App. No. 21CA1 21
2019. He viewed the property from the roadside and did not see any
additional erosions or slips that needed repaired.
{¶45} Pugh testified that he is unfamiliar with the exact definition of
unusual or extraordinary in this circumstance. To his knowledge, there’s no
standard industry definition. Pugh disagreed that the gullies developing
quickly would be considered unusual or extraordinary because the nature of
the property changed significantly when the embankment supporting the
well pad was built. Importantly, Pugh testified that if gullies appeared, it
was the pad owner’s responsibility to fix erosion and gully issues. He
further testified that up to the time Protégé sold the well pad and well site,
Protégé was responsible for fixing erosion and gully issues. If re-seeding
failed, it was still the pad owner’s responsibility. This testimony was key to
the trial court’s analysis.
{¶46} Finally, during Tara Fagen’s testimony, she agreed that the
Zimmer property was restored to “industry standards” and that restoration
occurred “no later than June 21st, 2016.” She testified Protégé spent a great
deal of time and money making repairs due to Dean Zimmer’s constant
complaints about the slopes, drainage, seeding, and temporary lines.
However, Fagen also admitted that she relies on the people in the field doing
Washington App. No. 21CA1 22
the work. She does not have a personal or professional opinion for what
constitutes acceptable industry standards for reclamation.
{¶47} In the Findings of Fact beginning at Page 3, the trial court wrote
as follows in paragraphs 15, 16, and 48:
15. Dean Zimmer testified that he sought other specific
assurances from Protégé regarding slope issues, slip
repair, fencing, guards and gates, as well as landscaping.
16. Prior to the construction of the drilling unit,
Zimmerview, via Dean Zimmer[,] and Tarah Fagan of
Protégé, entered into negotiations regarding the previously
described issues.
48. Protégé did not present any evidence regarding the
intent of the parties regarding the Damage Release
Agreement in Exhibit J-4.
{¶48} In the Conclusions of Law, beginning at Page 23, the trial court
further stated as follows in paragraphs 30-42 regarding claims for damage
related to cleanup/reclamation:
30. All the evidence presented by Zimmerview indicates
that the property has suffered substantial erosion and
damage issues that have never been corrected by Protégé.
31. Protégé did not present any evidence disputing the
severity of the property damage. Instead, as to these
damage issues, Protégé’s entire argument rests upon the
Damage Release Agreement.
34. The Damage Release Agreement was not an all-
encompassing release, there were exceptions in the
agreement that exempted the release from clean up
responsibilities and operations that Protégé was required
Washington App. No. 21CA1 23
to complete. Further, there was an exemption for
extraordinary or unusual damages.
35. The terms “cleanup operations” and “extraordinary or
unusual damages” are not defined in the Damage Release
Agreement.
38. The definition of these terms is not an argument that
needs to be addressed by this Court because Protégé has
acknowledged that there is a continuing duty and
obligation to correct erosion issues. Jason Pugh testified
to this duty.
39. This continuing duty regarding these issues also
makes sense in light of the history to attempt to repair the
land. The evidence showed that Protégé made four
attempts to correct issues with the property. During those
four attempts, Protégé never attempted to utilize the
Damage Release Agreement to state it no longer had a
responsibility to correct the erosion issues.
40. The issues that Protégé previously corrected in its
prior four attempts are the same issues that currently exist
with the property.
41. The Court hereby determines that the duties of Protégé
have not changed and are the same as what they were in
the prior four attempts to correct the issues. Therefore,
Protégé has an obligation to correct the erosion issues that
it previously failed to address. Protégé breached its
general contractual obligations to Zimmerview as
generally outlined in [exhibits] by failing to properly
cleanup/reclamate the land.
42. With Jason Pugh’s testimony regarding the ongoing
duties of the pad owner, the Court determines that the
Damage Release Agreement is inapplicable for the
damages claimed by Zimmerview. The Release is also
inapplicable due to exceptions contained in the release.
Washington App. No. 21CA1 24
{¶48} While the trial court did not make an explicit finding that the
Oil and Gas Lease was ambiguous, the trial court’s other findings support
this conclusion. The lease addresses surface restoration at Paragraph 31 and
generally provides that the Lessee “shall use commercially reasonable
efforts to repair and restore such damaged portion of the surface of the
Leased Premises as nearly as practicable to the condition in which said land
existed before commencement of operations.” Paragraph 31 further
provides that “[a]ll restoration work shall be done at the sole expense of
Lessee.” The lease does not define “commercially reasonable efforts” nor
state how many efforts are required to restore the property. The trial court
likely viewed this language, especially “commercially reasonable efforts,”
as open-ended and ambiguous. Given the ambiguity surrounding Protégé’s
duty to restore the property using commercially reasonable efforts, the trial
court properly allowed extrinsic evidence which explained the parties’
intent, and which described the restoration efforts. The trial court appears to
have relied heavily on Protégé’s own witness, Jason Pugh, in reaching its
conclusions.
{¶49} Here, the trial court judge served as the trier of fact. Weight
and credibility of the evidence are issues that the trier of fact must
determine. See Cooper, supra, at ¶ 28; State v. Frazier, 115 Ohio St.3d 139,
Washington App. No. 21CA1 25
2007-Ohio-5048, 873 N.E.2d 1263, ¶ 106; State v. Dye, 82 Ohio St.3d 323,
329, 695 N.E.2d 763 (1998). A trier of fact may choose to believe all, part
or none of the testimony of any witness who appears before it. See State v.
Colquitt, 188 Ohio App.3d 509, 2010-Ohio-2210, 936 N.E.2d 76, ¶ 10, fn. 1
(4th Dist.); State v. Nichols, 85 Ohio App.3d 65, 76, 619 N.E.2d 80 (4th Dist.
1993). Based on our review of the trial testimony, we find the trial court had
some competent credible evidence to support its determination that Protégé
had an ongoing duty to restore the Zimmerview property. Accordingly, we
find no merit to the first assignment of error. It is hereby overruled.
{¶50} Under the second assignment of error, Protégé argued that the
trial court erred with regard to its interpretation of the terms “cleanup
operations” and “extraordinary or unusual” damages. Dean Zimmer
considered the damage left by Protégé to be unusual and extraordinary. He
testified:
The production of the ground is very limited to none. The
- - washed gullies is a severe problem, safety and cattle-
wise. And production is - - has continued not to - - growth
is not - - has not continued to - - growth is not- - of grass
has not returned to where we could even, this whole length
of time, to have any production farm-wise off of it.
{¶51} The trial court observed as set forth above that the terms
“cleanup operations” and “extraordinary or unusual damages” are not
defined in the Damage Release Agreement. In response to the second
Washington App. No. 21CA1 26
assignment of error, Zimmerview argues that the trial court did not err in its
interpretation of the contract terms as the court used a reasonable, logical,
and plain application of the terms based on the evidence presented.
{¶52} Both parties somewhat mischaracterize the trial court’s
findings. As indicated above, the court further determined that cleanup
operations encompassed activities occurring in the process of returning the
land to Zimmerview in a similar condition as it was prior to construction,
and that the failures in cleanup operations led to the current damaged state of
the property. Id. at 36. In the Conclusions of Law, Page 24, the trial court
further observed:
37. Both parties had differing views on what was
considered extraordinary or unusual. Protégé appeared to
apply an unknown industry standard. Zimmerview
applied a standard related to operations on the property
since 1927 * * *. The Court determines that the
development of 4-foot gullies where [none] had existed
before is unusual and extraordinary.
38. However, the definition of these terms is not an
argument that needs to be addressed by this court because
Protégé has acknowledged that there is a continuing duty
to correct erosion issues.
{¶53} Based on our review of the trial transcript, we agree with the
trial court’s conclusion. The definition of the pertinent terms is unnecessary
given the court’s finding that Protégé’s failure to properly cleanup and
restore the Zimmerview property led to its current damaged state, and that
Washington App. No. 21CA1 27
Protégé had a continuing obligation to correct the erosion issues.
Accordingly, we find no merit to Protégé’s second assignment of error and it
is hereby overruled.
III. THE TRIAL COURT ERRED IN FINDING FOR
ZIMMERVIEW ON ITS BREACH OF
CONTRACT AND CONVERSION CLAIMS
RELATED TO TOPSOIL.
{¶54} “ ‘In order to succeed on a breach of contract claim, a party
must prove the existence of a contract, the party's performance under the
contract, the opposing party's breach, and resulting damage.’ ” Martin v.
Jones, 2015-Ohio-3168, 41 N.E.3d 123, at ¶36 (4th Dist.), quoting
DePompei v. Santabarbara, 8th Dist. Cuyahoga No. 101163, 2015-Ohio-18,
at ¶ 20; Spectrum Benefit Options, Inc. v. Med. Mut. of Ohio, 174 Ohio
App.3d 29, 2007-Ohio-5562, 880 N.E.2d 926, ¶ 25 (4th Dist.).
{¶55} To prevail on a claim for conversion, a plaintiff must prove “(1)
plaintiff’s ownership or right to possession of the property at the time of the
conversion; (2) defendant’s conversion by a wrongful act or disposition of
plaintiff’s property rights; and (3) damages,” Key Realty, Ltd. V. Hall, 2021-
Ohio-1868, 173 N.e.3d 831, at ¶ 95 (6th Dist.).
{¶56} The Supplemental Agreement executed by the parties herein
provides at Paragraph 3:
Washington App. No. 21CA1 28
Top Soil. The top soil piled as part of the pad construction
site which is generally set forth in the area set forth in
Exhibit 1 hereto shall be retained by Zimmerview.
(Emphasis added.) It shall be placed in a mutually agreed
upon location not to exceed 500 (five hundred) feet from
the area noted on Exhibit 1 unless otherwise agreed upon.
{¶57} Protégé argues that there was no breach of contract regarding
the topsoil and no conversion of the topsoil stockpile. Protégé contends that
the trial court improperly relied upon extrinsic evidence to find a breach of
the contract and a conversion because the evidence presented at trial did not
support a finding that the topsoil had been converted. Therefore, the trial
court erred by finding for Zimmerview on these claims.
{¶58} In response, Zimmerview seems to assert that the trial court
relied upon the plain language of the Supplemental Agreement but also
acknowledges that the trial court did examine extrinsic evidence in
construing the ambiguous topsoil clause. Furthermore, Zimmerview asserts
the court relied upon competent and credible evidence to determine that
there was both a breach of contract and a conversion of the topsoil. For the
reasons which follow, we find the topsoil clause was ambiguous. While the
trial court did not make an explicit finding of ambiguity, the trial court
properly relied upon competent and credible extrinsic evidence in reaching
its conclusion that the contract was breached and the topsoil converted.
Washington App. No. 21CA1 29
{¶58} During his testimony, Mr. Zimmer explained the
importance of topsoil and that lack of topsoil interferes with farming
operations because crops need the organic material and nutrients
within the topsoil. Prior to the project, the Zimmers had over six
inches or more of topsoil on their properties. Mr. Zimmer testified:
The topsoil was to be retained by us. * * * We wanted it at
the bottom of the LOD9 area, just because of being easier
access whenever it was used on our properties in the
future. They said that was too far to move it. So we kind
of went back and forth on where to—to put it, and then
we—we did agree on the site that they did originally
stockpile it, on top of the hill.
{¶59} Mr. Zimmer further testified that there was a large gully
at the bottom of the LOD construction area which he asked Protégé to fill,
because Zimmerview would completely lose five acres for pasture and
farmland. Zimmer wanted the gully filled so it would be farmable. Instead
of a monetary agreement for the loss, Protégé agreed to give Zimmerview
the topsoil in place of filling in the gully.
{¶60} Mr. Zimmer denied Protégé’s arguments that Zimmerview did
in fact “retain” the stockpile of topsoil. He testified the topsoil stockpile had
washed away into a nearby creek while Protégé was in control of the LOD
9
LOD was not defined by any of the witnesses. The photographic exhibits reference the LOD area, which
depict the construction area on the Zimmerview property.
Washington App. No. 21CA1 30
construction area. Furthermore, the evidence in this matter demonstrates
that Protégé used some of the stockpile of topsoil for purposes of its
reclamation of the area.
{61} James Vuksic testified that he assisted in negotiating
Paragraph 3 regarding the topsoil:
[W]e asked them to fill the - - the gully, and so that would
be farmable. They said they could not do that. And
instead of, you know, a monetary agreement on that, the
topsoil, they agreed to give us the topsoil in place of that,
in place of filling the gully.
{¶62} Vuksic continued:
So the long and the short is, they agreed that in lieu of
either filling a ravine or in lieu of money- - I don’t - - and
I honestly don’t recall which - - Dean agreed to take the
top - - a pile of topsoil that was sitting there, in lieu of all
that. They agreed to give it to him. And back and forth it
went, as to how much it was, where it was going to be
piled. Dean wanted it moved down close to the house or
down to the bottom of the hill and they refused and said
they would move it no more than 500 feet, and - - and
pointed to the area where they would pile it for Dean, or
for the Zimmers. And I went back to Dean and said, that’s
all the farther they’re going to haul it. Do you want the
dirt? And he said, Ok. We can move it ourself. [sic] And
that was that.
{¶63} When asked about his understanding of what was supposed to
happen to the topsoil at the end once Protégé left the site, Vuksic testified:
[L]ater he said, you know, they took the dirt and spread it
over the hill, and I said well, then send them a bill for the
Washington App. No. 21CA1 31
topsoil, because they took away your property. * * * They
- - they stole his property. That was his.
{¶64} Jason Pugh also testified regarding the agreement pertaining to
the topsoil. Pugh testified that one of the first things done to begin
construction is that all the topsoil from a particular site is stripped and
gathered at a particular location so it can be kept. The topsoil is preserved
so that it can then be reused at the end of the well pad construction to be re-
spread over the entire site that is to be seeded. In this case as well, the
topsoil that was excavated was put into the stockpile. The stockpile of
topsoil was used per standard general construction practice, to re-spread over
the entire site and used as the subgrade for seed that was applied to the site.
{¶65} Jason Pugh testified the Supplemental Agreement did not
prohibit Protégé from using the stockpile of topsoil in this manner. He
agreed that the extra topsoil not used for the actual pad acreage was used on
the reclamation of the property. Pugh also admitted that the word “retained”
was not defined by the agreement. However, Pugh testified that “retained”
meant that the topsoil did not leave the site and was retained by the owner on
the property. Protégé did not remove the stockpile of topsoil from the
property but moved it to a mutually agreed upon location.
{¶66} Pugh agreed that in Paragraph 3 there is nothing addressing
whether topsoil can be removed from the stockpile. There is nothing in
Washington App. No. 21CA1 32
Paragraph 3 that allows the soil to be used for reclamation. He testified he
did not know if the stockpile was gone at the end of construction.
{¶67} Pugh testified that Great Lakes Daily Reports provide
additional information regarding re-spreading of the topsoil. Pugh testified
at the end of operations, Protégé and its contractors restored the topsoil to its
former condition. He testified there were no extraordinary or unusual issues
with the topsoil.
{¶68} Brian Plautz reviewed the Great Lakes Daily Reports. As part
of the agreement with Protégé, Great Lakes replaced topsoil stripped from
the area around the well pad. Great Lakes spread the topsoil on the slopes
when finished. The topsoil was taken off site and put in a pile and then re-
spread. Any remaining topsoil would have been left at the stockpile location.
He testified that Great Lakes restored the slopes after construction.
{¶69} Plautz testified he did not have a role in negotiating the
contracts. He is not aware of the agreement between Zimmerview and
Protégé regarding the topsoil stockpile.
{¶70} Tarah Fagan’s testimony supported the argument that no
breach occurred. She testified no topsoil was removed from the
grounds. There was an agreement for the topsoil to be stockpiled in a
certain area. It was to stay on Zimmer property and be stockpiled for
Washington App. No. 21CA1 33
reclamation. The stockpile was not for Zimmer’s personal use. Fagan
testified there were no negotiations about that. Fagan admitted that
the formal agreement did not specifically spell out that the topsoil was
to be used for reclamation. However, the topsoil was never removed
from Zimmer’s property but was used to reclaim the property. In her
opinion, the topsoil was still Zimmer’s property.
{¶71} No one on behalf of Zimmerview testified as to what “retained”
meant in the Supplemental Agreement. Clearly, Dean Zimmer’s testimony
demonstrated that he expected to have all the topsoil stockpile and did not
contemplate the topsoil stockpile would be re-spread and thus, considered to
have been “retained” by him.
{¶72} In the Findings of Fact and Conclusions of Law, the trial
court recited many of the facts as set forth in the testimony above.
Specifically, in the Conclusions of Law, Paragraph 8, the trial court
observed that Protégé did not present any testimony or evidence regarding
the intent of the topsoil provision contained in Exhibit J-2. The trial court
analyzed as follows:
10. There is specific language in Paragraph 3 regarding a
specific location for the topsoil stockpile. * * * The
language in Paragraph three regarding the specific location
as well as evidence of negotiations regarding the location
indicate the intent that the topsoil stockpile was to be left
for Zimmerview after construction was completed. There
Washington App. No. 21CA1 34
would be no need for this location language if Protégé was
simply going to utilize the topsoil stockpile for
cleanup/reclamation shortly after excavation.
11. Paragraph 2 of Exhibit J-2 indicates that the topsoil
was to be a form of consideration.
12. The topsoil has no value as a form of consideration
unless Zimmerview is allowed to retain the topsoil
stockpile for its use. Further, the topsoil has no value as
consideration if Protégé is allowed to use it for their own
purposes.
13. There is no language in Paragraph 3 of the
Supplemental Agreement which allows further use of the
topsoil stockpile.
15. Protégé’s arguments regarding compliance with
Paragraph three by utilizing the topsoil in
cleanup/reclamation efforts lack merit. Without Paragraph
3, Protégé was already required to use commercially
reasonable efforts to repair and restore the surface of
Zimmerview’s property as nearly as practical to the
condition in which the land existed before commencement
of operations. Protégé was already operating under a
contractual requirement to reclaim the land, thus
Paragraph 3 would have no meaning pursuant to Protégé’s
interpretation.
17. Lastly Paragraph 3 indicates that the topsoil stockpile
was not to be removed from its location “unless otherwise
agreed upon.” This indicates at a minimum, that both
parties would be required to have input before the
stockpile could be moved from the agreed upon location.
Protégé’s actions indicate that they utilized the stockpiled
topsoil without seeking approval or agreement from
Zimmerview. They utilized the topsoil at their own
direction for their own needs on the construction site.
There would be no need for language regarding mutual
Washington App. No. 21CA1 35
agreement prior to removal of the stockpile unless it was
intended that the stockpile remain intact for Zimmerview.
18. Therefore, Protégé’s failure to leave the topsoil
stockpile for Zimmerview constitutes a breach of contract.
The actions of Protégé also indicate that Protégé converted
the topsoil for its own use to complete
cleanup/reclamation efforts for which it was already
contractually obligated to complete, i.e., it used
Zimmerview’s property to complete its contractual duties.
{¶73} Upon our de novo review, we agree with the trial court’s sound
reasoning which found Zimmerview had proven all elements of the breach
of contract and conversion claims. The trial court implicitly found the
contract language in the topsoil clause to be ambiguous and properly
admitted extrinsic evidence regarding the intent of the parties. The trial
court’s analysis of the contract language relating to the topsoil is well-
reasoned. Accordingly, we find no merit to the third assignment of error. It
is hereby overruled.
IV. THE TRIAL COURT ERRED IN
DETERMINING THE AMOUNT OF
DAMAGES TO AWARD ZIMMERVIEW
BECAUSE IT DID NOT APPLY THE
PROPER MEASURE OF DAMAGES AND
RELIED ON SPECULATION.
{¶74} Dean Zimmer testified that the current state of his property was
“nothing like it use to be.” He testified when Protégé and Great Lakes left
the well pad site in early fall 2015, they left parts of a fence behind. Cattle
Washington App. No. 21CA1 36
attempted to go through the fence and were hurt. There were gullies and
boulders, unsightly vegetation, and invasive weeds. Dean Zimmer made
Protégé aware of the landscaping issues and contacted ODNR. Dean
Zimmer, Billy Burkhart, and Larry Lang provided the only testimony as to
damages at the bench trial.
{¶75} On the claims of breach of contract and conversion of the
topsoil stockpile, the trial court rendered judgment in favor of Zimmerview
and against Protégé in the amount of $450,000.00, plus interest at the
statutory rate as of June 21, 2016, the date Protégé completed its operations
on the Zimmerview property. Further, regarding Zimmerview’s claims for
damages regarding breach of contract for failing to properly reclamate and
return the property to Zimmerview in a similar condition to what it was prior
to construction of the well pad, the trial court rendered judgment in favor of
Zimmerview and against Protégé in the amount of $349,093.00, plus interest
at the statutory rate as of June 21, 2016. Protégé asserts the trial court relied
on speculation and conjecture to determine the amount of damages awarded
for property damages and the topsoil claim. However, Zimmerview
responds that the trial court properly relied on the testimony of Dean
Zimmer, Billy Burkhart, and Larry Lang. Therefore, the trial court did not
abuse its discretion as the trial court’s findings were supported by competent
Washington App. No. 21CA1 37
and credible evidence. For the reasons which follow, we agree with
Zimmerview.
STANDARD OF REVIEW FOR DAMAGES
{¶76} “ ‘The cardinal rule of the law of damages is that the injured
party shall be fully compensated.’ ” GM Gas Exploration, Inc. v. McClain,
4th Dist. Athens No. 1438, 1991 WL 163644, (Aug. 13, 1991), at *5,
quoting Adcock v. Rollins Protective Services Co., 1 Ohio App.3d 160(1981). Trial court awards of damages are reviewed for abuse of discretion.
Green Maple Enterprises, LLC v. Forester, 2021-Ohio-4640, -- N.E. 3d --,
2021 WL 6276316, at ¶ 44 (7th Dist.); Griffin Contracting and Restoration
v. McIntyre, 2018-Ohio-3121, 107 N.E.3d 22 ¶ 35 (12th Dist.), citing and
quoting Roberts v. United States Fid. & Guar. Co., 75 Ohio St.3d 630, 634,
665 N.E.2d 664 (1996) (“[w]e will not disturb a decision of the trial court as
to a determination of damages absent an abuse of discretion”). See also
Hubbard Family Trust v. TNT Land Holdings, LLC, 2014-Ohio-772, 9
N.E.3d 411, at ¶ 63 (4th Dist.)
{¶77} In general, “ ‘ “[t]he measure of damages in a conversion action
is the value of the converted property at the time it was converted.” ’ ”
Acme Co. v. Sanders TopSoil, 7th Dist. Mahoning No. 10MA93, 2011-Ohio-
6523¶ 52, quoting Allied Erecting & Dismantling Co., Inc. v. Youngstown,
Washington App. No. 21CA1 38
151 Ohio App.3d 16, 2002-Ohio-5179, 783 N.E.2d 523, at ¶ 62, quoting
Tabar v. Charlie's Towing Serv., Inc. (1994), 97 Ohio App.3d 423, 428, 646
N.E.2d 1132. However, “[t]here is no inflexible rule as to the measure of
damages for a wrongful conversion.” Modarelli v. Fullerton Transfer &
Storage Limited, Inc. (May 30, 1978), 7th Dist. No. 77 CA 128. See also
Fulks v. Fulks, 95 Ohio App. 515, 121 N.E.2d 180 (1953), at paragraph two
of the syllabus. “ ‘An award of damages must be shown with a reasonable
degree of certainty and in some manner other than mere speculation,
conjecture, or surmise.’ ” Acme, supra at ¶ 52, quoting Elias v. Gammel, 8th
Dist. No. 83365, 2004-Ohio-3464, at ¶ 25. Damages are not speculative
when they can be “computed to a fair degree of probability.” Allied
Erecting & Dismantling Co. at ¶ 65. However, if the appellant
“ ‘ “establishes a right to damages, that right will not be denied because the
damages cannot be calculated with mathematical certainty.” ’ ” Id. at ¶ 64,
783 N.E.2d 523, quoting Hollobaugh v. D & V. Trucking, 7th Dist. No. 99
CA 303, 2001 WL 537058 (May 8, 2001), at *5, quoting Barker v.
Sundberg, 11th Dist. No. 92-A-1756, 1993 WL 489236 (October 25, 1993).
LEGAL ANALYSIS
{¶78} Dean Zimmer testified that his property is non-productive for
farming. The vegetation is “slim to none.” Mr. Zimmer identified
Washington App. No. 21CA1 39
photographs of the Zimmerview property taken in 2020 which show weeds,
mostly Marestail.10 The photographic exhibits depict extensive bare ground
between the weeds and many boulders still needing removed.
{¶79} Mr. Zimmer testified the gullies are major problems and
repairing these issues takes more equipment, time, and money than he has to
invest. He identified a photograph of himself standing inside a gully which
came up to his waist. He identified another photograph which showed the
gully measuring four feet. Zimmer testified the gullies continue to deepen
over time.
{¶80} Mr. Zimmer also explained that the drainage tile used in the
layers of well pad are not working properly and water is seeping out of the
hill even without rain. Water seepage is common in the well pad area. It
was his understanding that Protégé would remove the rock ledges. The land
is impassable with a tractor. One of the rock ledges is over ten feet. Some
of the rocks were pushed to the edge of the LOD area and left behind. The
rock ledges are mostly bare ground.
{¶81} Zimmer testified he sought professional help. Zimmer sought
estimates from Billy Burkhart and Larry Lang. Both men indicated the work
10
“Marestail,” also known as “horseweed,” comes from the sunflower family and can grow as tall as 6 feet.
It is resistant to some herbicides and is a major weed problem in corn and soybean areas. See National
Institute of Agriculture and Natural Resources, https://beef.unl.edu/beefwatch/marestail-horseweed.
Accessed December 15, 2021.
Washington App. No. 21CA1 40
set forth in their estimates will correct the issues depicted in the 2020
photographs of the LOD construction area. The trial court found as follows,
beginning at Page 14:
95. Billy Burkhart testified that he was contacted by Dean
Zimmer to provide an estimate for services to correct the
issues with the property as well as replacing a portion of
the topsoil stockpile that should have been left behind by
Protégé. Mr. Burkhart’s estimate is contained in Exhibit
P-17 and the math and the numbers used to come up with
the numbers in the estimate is contained in Exhibit P-18.
96. Billy Burkhart testified that the amount of topsoil for
approximately 13.5 acres of topsoil at 6 inches deep would
be approximately 1500 truckloads at a cost of $300.00 per
truckload to deliver the topsoil to the property with a final
price of $450,000. The estimate also included $25,000 for
the equipment necessary for the distribution and
placement of the topsoil and an additional $25,000 for the
seeding and mulching of the 8.5 acre hillside for a total
estimate of $500,000.
97. Larry Lang was also contacted by Dean Zimmer for
an estimate to correct the issues. Using the same
parameters as Billy Burkhart, Larry Lang’s estimate
totaled $489,975.
99. Protégé did not present any evidence or witnesses to
dispute the estimates given by both Burkhart and Larry
Lang and further did not dispute the current damaged state
of the land.
{¶82} Based on the foregoing, this court cannot say the trial
court erred in concluding at Page 22:
Washington App. No. 21CA1 41
20. Pursuant to the testimony of Billy Burkhart, the cost to
purchase and deliver 13.5 acres (1,500 truckloads) of topsoil at
the price of $300 per truckload, would cost $450,000.
21. Therefore, Zimmerview has been damaged in the amount
of $450,000 as a result of the breach of the Supplemental
Agreement of the Parties and conversion by Protégé of the
topsoil stockpile.
The trial court further concluded at Page 25:
43. As to the damages for said breach of contract, both
Billy Burkhart and Larry Lang testified as to what would
need to be done in order to repair the 8.5 acre area. Both
individuals testified to approximately the same manner by
which to repair the land. Pursuant to Exhibit P-19, it will
cost approximately $283,500.00 for the topsoil to
complete the repair on the 8.5 acre hillside, and will cost
$43,000.00 for seeding, mulching, and completion of
erosion control. The total amount necessary to repair the
hillside is $326,500.
44. Dean Zimmer also testified that he took multiple
measures to attempt to mitigate the damages in this matter.
Exhibit P-55 indicates that Mr. Zimmer spent $22,593.00
on behalf of Zimmerview in his attempts to fix the issues
with the land.
45. Total damages for failure to properly perform clean
up reclamation effort are $349,093.00.
{¶83} We have reviewed the record in its entirety and find no abuse of
discretion. The trier of fact is free to believe or disbelieve each and every
one of Zimmerview’s claims for damages. We cannot substitute our
judgment for that of the trier of fact who had the opportunity to hear the
witnesses and observe their demeanor. Ross v. Ross, 64 O. St. 2d 203, 414
Washington App. No. 21CA1 42
N.E.2d 426 (1980); State v. DeHass, 10 O. St. 2d 230, 227 N.E.2d 212(1967). Based on the foregoing, we find no merit to Protégé’s fourth
assignment of error. Accordingly, it is hereby overruled.
V. THE TRIAL COURT ERRED BY FINDING
PROTÉGÉ HAD BREACHED ITS
AGREEMENT WITH ZIMMERVIEW BY
FAILING TO PAY ADDITIONAL RENTS BY
IGNORING THE PLAIN LANGUAGE OF
THAT AGREEMENT AND RELYING ON
EXTRINSIC EVIDENCE.
{¶84} The third count of Zimmerview’s complaint related to
Zimmer’s lack of access to a portion of his pasture land in the amount of
$20,000.00 plus interest. The trial court rendered judgment in favor of
Zimmerview and against Protégé on this claim in the amount of $20,000.00,
plus interest at the statutory rate as of June 21, 2016. The court found
Protégé breached the Supplemental Agreement by preventing Zimmerview’s
access to the property due to construction lasting in excess of one year from
the date construction started. “Additional rents” were provided for in
Paragraph 10 of the Supplemental Agreement as follows:
ADDITIONAL CONSIDERATION: In the event that
Protégé’s operations prevent Zimmerview from obtaining
access to the 3 (three) acres of pasture east of the access
road for a time period exceeding 1 (one) year from the
commencement of site construction operations then
Zimmerview shall be entitled to an annual payment of
$20,000 (Twenty thousand Dollars) as additional
Washington App. No. 21CA1 43
consideration for its inability to access that portion of its
property until access is restored.
{¶85} Protégé contends that the trial court again ignored the plain
language of the agreement and improperly relied on extrinsic evidence in
finding a breach. By contrast, Zimmerview responds that both the plain
language and evaluation of the extrinsic evidence lead to the same
conclusion. For the reasons which follow, we agree with Zimmerview.
{¶86} The trial transcript reflects Dean Zimmer testified three acres of
his land was fenced off from being farmed because of the well pad; the
pasture land could not be used until the well pad was built and fencing was
removed. Zimmer testified that the agreement was if Protégé was there for
more than a year and kept the Zimmers from farming or using the land for
more than a year, Protégé would pay $20,000.00. James Vuksic assisted in
negotiating the term. Zimmer testified there was no discussion at all of a
“pro rata” or “monthly” basis.
{¶87} James Vuksic testified he was familiar with Paragraph 10 of the
Supplemental Agreement. He testified, “No one believed [Protégé] would
be there longer than a year. And if they were, they were to pay whatever the
fee was. That was it. * * * Dean insisted if they were they had to pay it, and
they said no problem.” When questioned about whether the parties
Washington App. No. 21CA1 44
discussed a pro rata distribution, Mr. Vuksic responded, “No. it was a fee. If
you went over the year, you paid a fee.”
{¶88} Jason Pugh testified that Protégé agreed to pay Zimmerview
rents/compensation if they were unable to restore Zimmer’s access to a
certain portion of the site within a specified date. Construction commenced
on May 4, 2015, and the fence was removed according to Hydrogreen’s
daily report on June 21, 2016, two months past one year. However, Pugh
testified that the prorated amount was what was agreed to in Paragraph 10.
{¶89} In the Findings of Fact and Conclusions of Law, at Page 6, the
trial court found:
37. Paragraph 10 of Exhibit J-2 indicates that if Protégé’s
operations prevent Zimmerview from obtaining access to
lands for one year from the commencement of site
construction that Zimmerview is entitled to a $20,000
annual cash payment as additional consideration for
Zimmerview’s inability to access portions of its property.
{¶90} The trial court concluded at Page 22:
23. Both parties acknowledge that Zimmerview was
prevented access to the land for a period of greater than
one year. Therefore, there is no dispute that Protégé is in
breach of Paragraph 1- of the Supplemental Agreement of
the Parties.
25. There exists no pro rata or monthly language contained
in Paragraph 10 of Exhibit J-2. It would have been very
easy for Protégé to have added such language to that
provision if that was their intent.
Washington App. No. 21CA1 45
28. Since there is no contract language contained in
Paragraph 10 that supports Protégé’s position of pro rata
distribution of the $20,000.00 provision, Zimmerview is
entitled to payment of $20,000.00 pursuant to Paragraph
10 of the Supplemental Agreement of the Parties. Thus,
the date construction started is inconsequential since
Paragraph 10 does not call for pro rata or monthly
distribution for periods extending over one year.
29. Therefore, Zimmerview has proven Protégé breached
Paragraph 10 of the Supplemental Agreement of the
Parties by a preponderance of the evidence and
Zimmerview is entitled to judgment on Paragraph 10 in
the amount of $20,000.00.
{¶91} The trial court allowed a great deal of extrinsic
evidence which supported Zimmerview’s claims. The trial court referenced
much of this evidence in the Findings of Fact and Conclusions of Law.
However, as indicated above, the trial court’s decision rested on the court’s
legal interpretation of Paragraph 10. As indicated above, the trial court’s
interpretation of contract language is subject to de novo review.
{¶92} In this case, we find the trial court properly construed the
language contained in Paragraph 10. Paragraph 10 references an “annual
payment,” and does not contain pro rata language. The trial court noted the
absence of pro rata language, which could have been easily included.
Black’s Law Dictionary, Abridged Sixth Edition, defines “annual” as, “[o]f
or pertaining to year; returning every year; coming or happening yearly.”
While the trial court referenced the testimony surrounding the inclusion of
Washington App. No. 21CA1 46
Paragraph 10, the trial court’s legal determination is easily supported by the
clear and unambiguous language of Paragraph 10. Protégé’s fifth
assignment of error is without merit and it hereby overruled.
CONCLUSION
Having found no merit to any of Appellant’s assignments of error, the
judgment of the trial court is affirmed.
JUDGMENT AFFIRMED.
Washington App. No. 21CA1 47
JUDGMENT ENTRY
It is ordered that the JUDGMENT BE AFFIRMED and that costs be
assessed to Appellant.
The Court finds there were reasonable grounds for this appeal.
It is ordered that a special mandate issue out of this Court directing
the Washington County Common Pleas 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.
Hess, J. and Wilkin, J. concur in Judgment and Opinion.
For the Court,
______________________________
Jason P. Smith
Presiding Judge
NOTICE TO COUNSEL
Pursuant to Local Rule No. 14, this document constitutes a final
judgment entry and the time period for further appeal commences from
the date of filing with the clerk.