Vitantonio v. Am. Constr. Group, L.L.C. , 2024 Ohio 325 ( 2024 )

[Cite as Vitantonio v. Am. Constr. Group, L.L.C., 2024-Ohio-325.]
STATE OF OHIO ) IN THE COURT OF APPEALS
)ss: NINTH JUDICIAL DISTRICT
COUNTY OF SUMMIT )
TERESA VITANTONIO C.A. No. 30522
Appellant
v. APPEAL FROM JUDGMENT
ENTERED IN THE
AMERICAN CONSTRUCTION GROUP COURT OF COMMON PLEAS
LLC, et al. COUNTY OF SUMMIT, OHIO
CASE No. CV 2019 11 4436
Appellee
DECISION AND JOURNAL ENTRY
Dated: January 31, 2024
CARR, Judge.
{¶1} Appellant, Teresa Vitantonio, appeals the judgment of the Summit County Court
of Common Pleas. This Court affirms.
I.
{¶2} This dispute arises out of a construction project at Vitantonio’s Avon residence.
The project entailed the installation of a luxury inground swimming pool, a stamped concrete pool
deck, a pool house, a raised terrace area, as well as other related structures and features. In
February 2018, Vitantonio entered into a contract with a Hudson company called American
Construction Group, LLC (“ACG”), to perform the work necessary to complete the project.
Tensions arose between the parties over the course of the following year as numerous aspects of
the project went awry.
{¶3} On November 19, 2019, Vitantonio filed a civil complaint setting forth numerous
causes of action, including breach of contract, fraud, engaging in a pattern of corrupt activity, and
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violations of the Home Construction Services Suppliers Act and the Consumer Sales Practices Act.
The named defendants in the complaint were ACG, American Pools & Fountains, MDF
Development Group, APF Enterprises, Cincinnati Insurance Company, as well as William H.
Foster, Erica Perez, and Dennis Artino in their individual capacities (“the Defendants”).
Vitantonio subsequently filed an amended complaint wherein she asserted several additional
claims.
{¶4} On October 8, 2021, Vitantonio and the Defendants filed a joint notice of settlement
indicating that they had reached a settlement and release as to all claims in the case. 1 The
settlement agreement set forth various deadlines to ensure that the project would be completed.
{¶5} On June 24, 2022, Vitantonio filed a motion to enforce the settlement agreement
and to award liquidated damages. The Defendants filed a brief in opposition to the motion. The
matter proceeded to a hearing where Vitantonio, Foster, and Perez gave testimony and the parties
presented a number of exhibits, including a copy of the settlement agreement. The trial court
permitted the parties to file supplemental briefs after the hearing.
{¶6} The trial court subsequently issued a journal entry granting Vitantonio’s motion in
part and denying it in part. First, the trial court granted Vitantonio’s request for liquidated damages
in the amount of $10,000 on the grounds that the defendants failed to cure certain defects within
the allotted time frame after receiving a written notice of breach, as was mandated by the parties’
settlement agreement. Second, the trial court denied Vitantonio’s motion as it related to her claim
for specific performance because the defendants completed the construction work on the pool
features by the date specified in the settlement agreement. Finally, the trial court denied
1
After a telephone status conference in January 2022, the case was transferred to the trial
court’s inactive docket.
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Vitantonio’s request for attorney fees on the basis that there was not a provision pertaining to
attorney fees in the settlement agreement and Vitantonio had not demonstrated that the Defendants
acted in bad faith.
{¶7} On appeal, Vitantonio raises one assignment of error.
II.
ASSIGNMENT OF ERROR
THE TRIAL COURT ERRED IN DETERMINING THAT ATTORNEY’S FEES
COULD NOT BE AWARDED TO A PREVAILING PARTY ON A MOTION TO
ENFORCE A SETTLEMENT AGREEMENT IN THE ABSENCE OF AN
EXCEPTION TO THE AMERICAN RULE.
{¶8} In her sole assignment of error, Vitantonio contends that the trial court erred in
denying her request for attorney fees on the basis that she had failed to demonstrate an exception
to the American Rule. This Court disagrees.
{¶9} It is well-settled that Ohio adheres to the American Rule regarding attorney fees,
meaning that the prevailing party is generally not entitled to recover attorney fees as a part of the
costs of litigation. Nottingdale Homeowners' Assn., Inc. v. Darby, 33 Ohio St.3d 32, 33-34 (1987).
Ohio courts have recognized exceptions to the American rule under circumstances where either
(1) a statute or an enforceable contract specifically provides for the losing party to pay attorney
fees, or (2) the prevailing party demonstrates bad faith on the part of the losing party. Wilborn v.
Bank One Corp., 121 Ohio St.3d 546, 2009-Ohio-306, ¶ 7; Technical Constr. Specialties, Inc. v.
New Era Builders, Inc., 9th Dist. Summit No. 25776, 2012-Ohio-1328, ¶ 26 (“As exceptions to
[the American Rule], recovery of attorney fees may be permitted if (1) a statute creates a duty to
pay fees, (2) the losing party has acted in bad faith, or (3) the parties contract to shift fees.”).
{¶10} Under circumstances involving a motion to enforce a settlement agreement, this
Court has observed that, absent a statute or an explicit clause pertaining to the payment of attorney
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fees, “[a] party seeking fees because the opposing party acted in bad faith must be the prevailing
party and must prove that the opposing party acted in bad faith.” (Internal quotations omitted.)
Clark v. Corwin, 9th Dist. Summit No. 28455, 2018-Ohio-1169, ¶ 20.
{¶11} The trial court held a hearing on the motion to enforce the settlement agreement.
Vitantonio testified in support of her motion. William Foster and Erica Perez testified on behalf
of the Defendants. The testimony at the hearing focused on the events that had transpired in the
months that had elapse d since the parties had reached a settlement. Vitantonio maintained that
the Defendants were unwilling to commit the resources necessary to complete the project in the
time frame specified by the agreement. Vitantonio further testified that she had incurred a variety
of expenses due to the Defendants’ failure to complete the project, including additional legal fees.
In response, the Defendants insisted that the delays in completing the project were due to inclement
weather. The Defendants further argued that any functionality problems with the various features
associated with the project were due to maintenance issues, not construction flaws.
{¶12} The parties addressed the issue of attorney fees both during closing arguments at
the hearing and in their post-hearing briefs. Vitantonio argued that attorney fees should be part of
the compensatory damages awarded upon the finding that there was a material breach of the
settlement agreement. Vitantonio reasoned that attorney fees should not be considered part of
litigation costs given that “the litigation stops at the time of the settlement.” In response, the
Defendants stressed that there was not a provision pertaining to attorney fees in the parties’
settlement agreement that would allow for an exception to the American Rule.
{¶13} The trial court denied Vitantonio’s request for attorney fees. In reaching this
conclusion, the trial court found that the settlement agreement did not contain a provision that
would allow for an award of attorney fees to a party that prevailed on a motion to enforce a
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settlement agreement. The trial court further found that the evidence presented at the hearing did
not support the conclusion that the Defendants had acted in bad faith.
{¶14} On appeal, Vitantonio argues that she should not have been required to show bad
faith or prove any other exception to the American Rule on attorney fees because this matter
involved a motion to enforce a settlement agreement. Vitantonio points to several decisions,
including this Court’s decision in Niederst v. Niederst, 9th Dist. Summit No. 28846, 2018-Ohio-
5320, in support of the proposition that a party who prevails on a motion to enforce a settlement
agreement is entitled to attorney fees.
{¶15} Vitantonio’s argument is without merit. As noted above, this Court has recognized
that a party seeking to recover attorney fees for enforcing a settlement agreement is generally
required to prove bad faith. See Clark, 2018-Ohio-1169, ¶ 20; LEH Properties, Inc. v. Pheasant
Run Assn., 9th Dist. Lorain No. 10CA009780, 2011-Ohio-516, ¶ 22. Although Vitantonio points
to this Court’s decision in Niederst, that case involved a scenario where an award of attorney fees
was challenged on public policy grounds. Niederst at ¶ 27. This Court rejected that argument and
stressed that the parties had specifically included a provision pertaining to attorney fees in the
settlement agreement. Id. Unlike Niederst, the instant matter involved a settlement agreement
that contained a liquidated damages clause and no provision pertaining to attorney fees. In the
absence of both a showing of bad faith and a specific clause in the settlement agreement regarding
attorney fees, the trial court did not err in denying Vitantonio’s request for attorney fees in this
case.
{¶16} Vitantonio’s assignment of error is overruled
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III.
{¶17} Vitantonio’s assignment of error is overruled. The judgment of the Summit County
Court of Common Pleas is affirmed.
Judgment affirmed.
There were reasonable grounds for this appeal.
We order that a special mandate issue out of this Court, directing the Court of Common
Pleas, County of Summit, State of Ohio, to carry this judgment into execution. A certified copy
of this journal entry shall constitute the mandate, pursuant to App.R. 27.
Immediately upon the filing hereof, this document shall constitute the journal entry of
judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the period
for review shall begin to run. App.R. 22(C). The Clerk of the Court of Appeals is instructed to
mail a notice of entry of this judgment to the parties and to make a notation of the mailing in the
docket, pursuant to App.R. 30.
Costs taxed to Appellant.
DONNA J. CARR
FOR THE COURT
SUTTON, P. J.
FLAGG LANZINGER, J.
CONCUR.
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APPEARANCES:
BRIAN C. MULHALL and NATHAN B. ZION, Attorneys at Law, for Appellant.
JOHN SEBASTIAN, Attorney at Law, for Appellee.
JOSEPH A. PFSUNDSTEIN, Attorney at Law, for Appellee.
THOMAS W. WRIGHT and MATTHEW BARINGER, Attorneys at Law, for Appellee.
ELLEN L. FORNASH, Attorney at Law, for Appellee.