Granada v. Rojas ( 2024 )

[Cite as Granada v. Rojas, 2024-Ohio-1272.]
COURT OF APPEALS OF OHIO
EIGHTH APPELLATE DISTRICT
COUNTY OF CUYAHOGA
ADRIANA GRANADA, :
Plaintiff-Appellant, :
No. 112622
v. :
ISRAEL ROJAS, :
Defendant-Appellee. :
JOURNAL ENTRY AND OPINION
JUDGMENT: AFFIRMED
RELEASED AND JOURNALIZED: April 4, 2024
Civil Appeal from the Cuyahoga County Court of Common Pleas
Domestic Relations Division
Case No. DR-20-383315
Appearances:
David J. Horvath, for appellant.
Baron Family Law, LLC, and Alexis M. Gacey, for
appellee.
FRANK DANIEL CELEBREZZE, III, J.:
Adriana Granada (“Granada”) appeals from the final decree issued by
the domestic relations court following her divorce from Israel Rojas (“Rojas”). After
a thorough review of the record and law, we affirm.
I. Factual and Procedural History
The parties do not dispute that they married on July 1, 2015, and that
no children were born as issue of the marriage. During that time, the parties jointly
established a business, Just Right Environmental LLC (“Just Right”). In November
2020, Granada filed a complaint for divorce against Rojas, who answered and
counterclaimed with his own complaint for divorce.
In September 2021, Rojas filed a motion for leave to file an amended
counterclaim, seeking annulment of the marriage. The amended counterclaim
alleged that “[d]uring the pendency of the case, [Rojas] obtained evidence that
[Granada] entered into the marriage with [Rojas] as a fraudulent means to obtain
U.S. citizenship[.]” Rojas attached an affidavit executed by Jeremy Dinardo,
alleging that prior to meeting Rojas, Granada sought marriage from Dinardo for the
same reason. Rojas also attached the transcript of a conversation that he had with
Granada, translated from Spanish, where Grenada admitted that she married Rojas
for citizenship purposes.
The parties tried the matter before a magistrate on January 3, 2022.
Pertinent to this appeal, both parties presented experts who testified regarding the
valuation of Just Right. Granada’s expert, Terri Lastovka (“Lastovka”), testified that
the fair market value of Just Right was $840,000. Rojas’s expert, C. Clay Miller
(“Miller”) opined that the fair market value of Just Right was in the neighborhood
of $290,000.
The magistrate issued a decision on July 22, 2022. Both parties timely
filed objections and the trial court overruled all except for Rojas’s second objection
that disputed the magistrate’s finding that the parties jointly owned a boat and two
jet skis, awarded Rojas ownership, and found that Rojas owed Granada $11,000 for
the watercrafts. The trial court found that the evidence only established ownership
as to a boat and a single jet ski and therefore, Rojas only owed Granada $9,000. The
trial court adopted the magistrate’s decision and issued a final decree on April 6,
2023.
Granada timely appealed; Rojas attempted to cross-appeal, but was
untimely in his efforts. We therefore proceed to review Granada’s four assignments
of error.
I. The trial court abused its discretion in dividing marital property
when it adopted the appellee’s expert report and “[expressly] rejected”
the more advanced, [thorough] and competent expert report of Terry
[Lastovka], a seasoned expert and court witness.
II. The trial court committed error in its division of property when it
adopted the report of Miller and rejected the report of Lastovka and in
failing [to] address over $350,000[] in marital funds taken by the
appellee.
III. The trial court [committed] reversable [sic] error in not taking into
account the vast [disparity] in income of the parties as well as their
lifestyle in denying appellant spousal support.
IV. Regarding tax liabilities of the parties, the trial court [committed]
reversible error in not addressing the potential tax liabilities of the
parties for appellee’s underreporting of income.
II. Law and Analysis
A. Valuation of Just Right
In her first assignment of error, Granada argues that the trial court
erred in determining the fair market value of Just Right when it found Rojas’s expert
credible and rejected Granada’s expert.
A trial court’s decision regarding the admission of expert testimony is
afforded broad discretion and thus, will not be disturbed absent an abuse of
discretion. Brown v. Brown, 2014-Ohio-2402, 14 N.E.3d 404, ¶ 62 (8th Dist.),
citing Chattree v. Chattree, 8th Dist. Cuyahoga No. 99337, 2014-Ohio-489, ¶ 45.
Whether an expert’s opinion is admissible depends on whether the principles and
methods employed by the witness to reach his opinion are reliable and not
necessarily whether his conclusions are correct. Chattree at ¶ 48, citing Miller v.
Bike Athletic Co., 80 Ohio St.3d 607, 611, 687 N.E.2d 735 (1998). Further, a decision
regarding a business valuation “involves factual inquiries, requiring an appellate
court to apply a manifest weight of evidence standard of review.” Haynes v. Haynes,
8th Dist. Cuyahoga No. 92224, 2009-Ohio-5360, ¶ 14, citing Wright v. Wright, 4th
Dist. Hocking No. 94CA02, 1994 Ohio App. LEXIS 5207,12 (Nov. 10, 1994). “An
appellate court will not reverse a trial court’s valuation if it is supported by some
competent, credible evidence.” Id., citing Seasons Coal Co. v. Cleveland, 10 Ohio
St.3d 77, 80, 461 N.E.2d 1273 (1984).
When Granada raised this objection to the magistrate’s decision, the
trial court overruled it, finding that
[Rojas] is the owner of a remediation and environmental cleanup
service called Just Right Environmental, LLC. The parties agree that
the business is a marital asset. [Granada and Rojas] each retained an
expert to prepare a report and testify at trial to an estimated valuation
of the business. [Granada’s] expert determined that as of December 31,
2020, the business had a value of approximately $840,000. [Rojas’s]
expert determined that as of August 31, 2021, the business had an
estimated value of $291,100.
Both experts submitted valuation reports and testified to their
credentials and to how they determined the value of the business. Both
experts used a Capitalized Earning Method and Market Data Method
to reach their conclusions. Both experts considered the marketability
of the business and applied a discount to their valuations accordingly.
After hearing the testimony and reviewing the records, the Magistrate
determined that [Rojas’s] expert provided a more accurate valuation,
and expressly rejected the valuation of [Granada’s] expert.
Upon review of the record, transcripts, and other supporting
documents, the Court agrees with the Magistrate. [Granada’s] and
[Rojas’s] experts came to significantly different conclusions of the
business’s value. [Just Right] is a small business with few employees
that was started in 2018 by [Rojas], only two years prior to [Granada]
filing her complaint for divorce. Further, [Just Right] offers a niche
service indicating a lack of secondary market should [Rojas] choose to
sell the business. Taking into consideration the business’s revenues,
expenditures, and marketability, [Rojas’s] expert’s valuation is more
reasonable and credible. [Granada’s] first objection is overruled.
Granada points us to several portions of the transcript where she
merely disagrees with Miller. Some of Granada’s most significant claims are that
Miller (1) admitted that Just Right cannot be evaluated by its book value; (2) only
reviewed tax returns, some financial statements, pay stubs, check registers from the
preceding three years, and a balance sheet; (3) admitted to using limited and
outdated outside sources for comparable sales and valuation; (4) only spoke to the
owner and office manager of Just Right; (5) did not use any hypothetical
considerations or evaluations, nor take into account the strengths or weaknesses of
the business that might have influenced the valuation; and, (6) was not aware of
Rojas’s personal expenses placed on the business credit card nor Rojas’s cash
withdrawals from the bank account. Granada argues that by contrast, Lastovka
reviewed the corporate bank statements that did not correspond to the tax returns
and realized that Rojas withdrew large amounts of cash in 2019 and 2020, and used
these in computing the valuation. Granada also attacks the credibility and
qualifications of Miller as compared to Lastovka.
We note that all of this information was available to the magistrate and
trial court via the transcript and admitted exhibits. Both Miller and Lastovka
testified as to the strengths and limitations of their review, recognized that a
business of this type is difficult to value, and testified as to their qualifications and
background in performing their respective evaluations. Both experts revealed
exactly what information was made available to them by the parties and whether it
was considered in their reports and valuation calculations, therefore demonstrating
the confines of each of their reports.
The trial court considered all of the factors that Granada raises as
questionable. As the trial court did, we note that this is a fairly new business with
limited records and is family-run with few employees, making valuation difficult.
Nonetheless, these difficulties were spelled out for the trial court by both experts,
whether on direct or cross-examination. The trial court was therefore entitled to
accept Miller’s opinion as to the valuation over Lastovka’s, and the record indicates
that Miller set forth competent, credible evidence from which the trial court could
determine that Miller’s computations were closer to the exact value of Just Right.
We therefore conclude that there was no abuse of discretion.
Granada’s first assignment of error is overruled.
B. Withdrawals from Business Account
In her second assignment of error, Granada argues that the trial court
erred in failing to address the alleged $350,000 in cash that Rojas withdrew from
Just Right at the beginning of the divorce proceedings in determining the valuation
of Just Right. As in her first assignment of error, Granada alleges that the trial court
erred in accepting Rojas’s expert’s testimony as to the withdrawals over Granada’s
expert, who took them into account when completing her evaluation. Moreover,
both Rojas and Granada testified regarding these distributions and made the trial
court aware of them. Granada does not contest “any other distributions of property”
and instructs that she is only appealing the valuation of Just Right rather than the
trial court’s entire determination on the division of marital property.
Because Granada limits this assignment of error to merely the
valuation of Just Right, we note that it is almost identical to her first assignment of
error: a disagreement with the magistrate and trial court’s choice to adopt the
valuation posed by Rojas’s expert over Granada’s expert. We once again reiterate
that the trial court had these arguments before it, heard the testimony of both
experts, heard the testimony of the parties, and ultimately decided to accept Miller’s
valuation of the company over Lastovka’s. Further, the trial court concluded that
“any distributions from [Rojas’s] business taken by [Rojas] during the marriage was
income to [Rojas] and not subject to division under R.C. 3105.171(A)(3)(a).” There
is competent, credible evidence in the record that Miller’s proposed value of Just
Right was reliably supported, and that the cash withdrawals made by Rojas could
have been income pursuant to R.C. 3105.171(A)(3)(a).
Granada’s second assignment of error is therefore overruled.
C. Spousal Support
In Granada’s third assignment of error, Granada argues that the trial
court erred in denying her spousal support. In support of this assignment of error,
Granada claims that the trial court acted arbitrarily and unreasonably in its
determination that spousal support was neither appropriate nor reasonable.
Granada premises her argument upon the disparity in earnings between the parties
and the opportunities that Rojas’s business would provide for him.
A determination as to whether spousal support should be awarded
requires a trial court to consider the factors enumerated in R.C. 3105.18(C)(1)(a)-(n)
and has broad discretion in determining whether spousal support is appropriate.
Friedler v. Friedler, 8th Dist. Cuyahoga No. 92402, 2009-Ohio-4719, ¶ 13, citing
Cooper v. Cooper, 8th Dist. Cuyahoga No. 86718, 2006-Ohio-4270, ¶ 8. Decisions
regarding spousal support will not be disturbed on appeal absent a showing that the
trial court abused its discretion. Blakemore v. Blakemore, 5 Ohio St.3d 217, 218,
450 N.E.2d 1140 (1983).
As the appellant in Friedler also argued, Granada claims that the trial
court failed to discuss the findings of fact that led it to deny spousal support, and
thus abused its discretion. Friedler, however, found that the magistrate and trial
court’s discussion of the marital assets, including the real property, debts, and
financial assets along with the length of the marriage were sufficient as findings of
fact to support the trial court’s decision to refrain from awarding spousal support.
Id. at ¶ 16-17.
In the instant matter, the magistrate found that the duration of the
marriage was July 1, 2015, through December 20, 2021, and that Rojas had owned
two properties prior to the marriage that are separate property. The magistrate
made findings regarding the parties’ interest in jointly owned real estate and equity,
personal property, vehicles, watercrafts, financial accounts, pensions, annuities,
Just Right, the proceeds of a civil lawsuit settlement, and debts; all of which were
divided equally among the parties. After discussing these assets, the magistrate
denied spousal support, noting that “[a]fter considering all of the statutory factors
set forth above, it is neither appropriate nor reasonable for spousal support to be
paid[.]”
After Granada raised the denial of spousal support in her objections,
the trial court reviewed the record and determined that the magistrate did not
commit an abuse of discretion, finding that
[o]n February 16, 2021, [Granada] filed a Motion for Temporary
Support requesting an order of temporary spousal support. On
May 25, 2021, * * * upon review of the parties’ affidavits and submitted
financial documents, determined that an order of temporary support
was not appropriate.
On June 1, 2021, [Granada] filed a Motion for [Civ.R. 75(N)] hearing
regarding the Magistrate’s Order denying Temporary Support. On
September 2, 2021, prior to the [Civ.R. 75(N)] hearing[,] the parties
filed an Agreed Judgment Entry stating that [Rojas] agreed to pay
[Granada] a sum of $1,500 monthly as for spousal support during the
pendency of the divorce.
At trial, [Granada] requested an award of spousal support in the final
decree of divorce. [Rojas] requested that no spousal support be
awarded. [The subsequent magistrate] determined that an award of
spousal support was not appropriate.
The court has reviewed the record in its entirety and agrees with both
[magistrates]. This was a short term marriage. No children were born
as issue of the marriage. Upon review and in consideration of the
factors in R.C. 3105.18(C)(1), the court finds that an award of spousal
support is neither reasonable nor appropriate.
Upon our own review, we can glean that both the magistrate and the
trial court made explicit findings of fact pursuant to R.C. 3105.18(C)(1)(a), (d), (e),
and (i),1 and also stated that it considered the others. “A trial court is not required
to enumerate each factor in R.C. 3105.18(C)(1), but must merely provide a sufficient
basis to support its award.” Kapadia v. Kapadia, 8th Dist. Cuyahoga No. 94456,
2011-Ohio-2255, ¶ 83, citing Abram v. Abram, 9th Dist. Medina No. 3233-M, 2002-
Ohio-78. Additionally, this court has previously noted that income equalization is
1 These factors are “(a) The income of the parties, from all sources, including, but
not limited to, income derived from property divided, disbursed, or distributed under
section 3105.171 of the Revised Code; * * * (d) The retirement benefits of the parties; (e)
The duration of the marriage; * * * (i) The relative assets and liabilities of the parties,
including but not limited to any court-ordered payments by the parties[.]”
not a factor that must be considered under R.C. 3105.18(C)(1). Walpole v. Walpole,
8th Dist. Cuyahoga No. 99231, 2013-Ohio-3529, ¶ 23.
Granada and Rojas both acquired numerous assets during the
marriage, all of which were divided equally among them, resulting in Granada
receiving a lump sum payment of at least $183,050.2 Granada also retained a 100
percent interest in her residential and commercial cleaning business, as noted in the
final decree. It was not an abuse of discretion, therefore, for the trial court to deny
Granada spousal support.
Granada’s third assignment of error is overruled.
D. Tax Liability and Responsibility
In her final assignment of error, Granada argues that the trial court
erred in failing to address tax responsibility for Just Right and notes that “Mr. Rojas
should be entirely responsible for any tax liability for [Just Right] since its inception
through the present, along with any other misrepresentation of income on his
personal return.”
During the oral argument on this matter, Rojas conceded this
assignment of error, and later filed a supplemental notice, conceding that “[he]
2 Unfortunately, we do not know the exact amount that Granada will receive, and
neither did the trial court. The final decree ordered Rojas to pay $28,500 for her interest
in the marital real estate properties; $9,000 for the boat and jet ski; and $145,550 for her
interest in Just Right. The trial court also ordered Rojas to pay Granada “half of the
amount of the proceeds he received pursuant to the settlement of his civil lawsuit against
Pioneer Environmental in CV-19-923300.” The trial court noted that the amount was
unknown because no evidence was presented to determine the amount of proceeds
received.
agrees to save and hold [Granada] harmless from any liabilities associated with his
tax returns, including the returns of Just Right Environmental, LLC.” Accordingly,
we need not further address this assignment of error because the parties are in
agreement as to tax liability. We also note that there is almost no discussion
regarding tax liability, no evidence of outstanding tax liabilities, and no evidence
that either party will incur tax liabilities on the record before us. We therefore do
not find that the trial court was even required to address the tax liabilities because
neither party demonstrated that tax liabilities needed to be addressed and divided
in the decree.
Granada’s final assignment of error is overruled.
III. Conclusion
We find no merit in any of Granada’s assignments of error. The trial
court’s business valuation, that includes the cash withdrawals made by Rojas, is
supported by competent, credible evidence in the record. The trial court did not
abuse its discretion in determining that spousal support was not warranted based
on the evidence presented in this matter. Finally, the trial court did not abuse its
discretion in failing to address Granada’s potential tax liability where this issue is
not contained in the record as an issue that must be addressed.
Judgment affirmed.
It is ordered that appellee recover from appellant costs herein taxed.
The court finds there were reasonable grounds for this appeal.
It is ordered that a special mandate be sent to said 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.
FRANK DANIEL CELEBREZZE, III, JUDGE
EILEEN A. GALLAGHER, P.J., and
ANITA LASTER MAYS, J., CONCUR