Swan v. Villas Condominium Unit Owners Assn. ( 2024 )

[Cite as Swan v. Villas Condominium Unit Owners Assn., 2024-Ohio-2313.]
IN THE COURT OF APPEALS
FIRST APPELLATE DISTRICT OF OHIO
HAMILTON COUNTY, OHIO
DARYL SWAN, : APPEAL NO. C-230517
TRIAL NO. A-2101811
GWENDOLYN BOGGS,
:
MARY EASON, O P I N I O N.
CLEOPIES OLINGER,
:
DOROTHY WITTE,
and :
HELEN BINFORD
Plaintiffs-Appellants, :
VS.
:
THE VILLAS CONDOMINIUM UNIT
OWNERS’ ASSOCIATION,
:
PAUL THYBERG,
NANCY THYBERG,
:
PATRICK FLOWERS,
and :
DENISE LYNCH,
Defendants-Appellees. :
OHIO FIRST DISTRICT COURT OF APPEALS
Civil Appeal From: Hamilton County Court of Common Pleas
Judgment Appealed From Is: Affirmed
Date of Judgment Entry on Appeal: June 18, 2024
The Williamson Law Firm LLC, Anisa A. Williamson and Jesse Jackson, Jr., for
Plaintiffs-Appellants,
BatesCarey LLP, Agelo L. Reppas, Marshall Dennehey and Ray C. Freudiger, for
Defendants-Appellees.
2
OHIO FIRST DISTRICT COURT OF APPEALS
CROUSE, Judge.
{¶1} In this appeal, we are asked to determine whether the trial court erred
in enforcing a settlement agreement that, while written, was not signed by all parties
to the agreement. Because the record does not establish that the parties intended for
the binding nature of the agreement to be contingent upon the execution of a formal,
signed writing, and because the parties reached a meeting of the minds as to all
essential terms of the agreement, we hold that the trial court did not err in enforcing
the settlement agreement and we affirm its judgment.
I. Litigation is Filed and a Settlement is Reached
{¶2} Plaintiffs-appellants Daryl Swan, Gwendolyn Boggs, Mary Eason,
Cleopies Olinger, Dorothy Witte, and Helen Binford (collectively “the unit owners”)
each own an interest in a condominium unit in The Villas condominium complex. On
May 26, 2021, the unit owners filed suit against defendants-appellees The Villas
Condominium Unit Owner’s Association (“the Villas”) and four members of the Villas
Board of Directors, namely Paul Thyberg, Nancy Thyberg, Patrick Flowers, and Denise
Lynch (collectively “the Board”). The Board governs the Villas.
{¶3} The complaint generally alleged that a contract existed between the unit
owners and the Villas, and that the Villas and the Board breached that contract by
failing to maintain complete and accurate books and records of expenses paid for work
done on condominium property, failing to allow the unit owners to inspect the books,
and failing to maintain common spaces at the Villas, which allowed the property to fall
into disrepair. The complaint asserted claims for breach of contract, breach of
fiduciary duty, and negligence. It also sought a declaratory judgment that the unit
owners are entitled to inspect the Villas’ records and that the Villas is required to
3
OHIO FIRST DISTRICT COURT OF APPEALS
maintain the property in accordance with the contract between the Villas and the unit
owners.
{¶4} The parties attended a settlement conference in September of 2022.
They left that conference having reached an agreement to settle the unit owners’
claims. The settlement agreement included the Villas’ and the Board’s agreement to
hold meetings three times a year and the time limits and “atmosphere guidelines”
governing the meetings, including the unit owners’ ability to submit issues to be
discussed and the Board’s authority to discontinue a meeting if the participants did
not behave in a respectful manner.
{¶5} The parties reported to the trial court that a settlement agreement had
been reached. The trial court’s law clerk emailed counsel for both parties stating, “It is
the Court’s understanding this case has settled and that the parties are working on a
final agreement. I have set this case for final entry on 12/16/22 at 1 PM. No one needs
to call or appear on this date. The Court will just be checking for final paperwork. The
Court is not vacating the pretrial or jury trial at this time.”
{¶6} Donielle S. Willis, an attorney representing the Villas and the Board, put
the terms that the parties had agreed upon in a writing titled “Affidavit and Full and
Final Release/Covenant not to Sue.” She emailed the agreement and a stipulation of
dismissal to Darlene Smith, then counsel for the unit owners. Smith responded with
proposed changes to the agreement, including the elimination of defense-and-
indemnification language concerning related lawsuits filed by future condominium
owners against the Villas and the Board. Willis objected to the elimination of that
language and the following email exchange between counsel occurred:
4
OHIO FIRST DISTRICT COURT OF APPEALS
12/1/22 (9:12 a.m. email from Willis to Smith): Darlene, We have
reviewed your comments and there are a few changes we still need on
our end. We do not want to get rid of/add language about future owners
suing for the same thing. My client obviously wants to make sure no
future liability or claims arise from one, two, or however many other
units down the road for this exact same thing. We need to keep this
language. Let me know if you need to discuss further. My comments are
in green and yellow. Thanks[.]
12/1/22 (11:41 a.m. email from Smith to Willis): Hi Donielle: My Clients
cannot speak for future owners. This suit was not a class action. It is
unreasonable and would put my Clients in a position of liability to have
them speak for persons who were not a part of this suit and with whom
they were not in privity of contract at the time of this suit. Under what
legal theory are your Clients requesting this broad indemnification?
12/1/22 (3:30 p.m. email from Willis to Smith): Darlene, We want to
keep this language. I understand your position, and we aren’t asking
about future individuals per se not suing, but we don’t want you going
and representing another set of individuals who would ask for the same
thing when we are already in agreement to do something that applies to
all those individuals. Does this make sense? If not, feel free to call my
cell [phone number]. Thanks.
12/6/22 (1:07 p.m. email from Smith to Willis): Hi Donielle: Yes I would
like to speak with you to see regarding this. What is your availability for
today?
5
OHIO FIRST DISTRICT COURT OF APPEALS
{¶7} It is evident from the emails in the record that counsel eventually
discussed the issue on a phone call. After the call, the following email exchange took
place:
12/13/22 (11:19 a.m. email from Smith to Willis): Good morning
Donielle: With the looming Court deadline of this Friday, I am checking
in for an update after our conversation on December 6, 2022, regarding
the addition of: “and with which Releasees have substantially complied”
to the end of the last full paragraph on Page 3. Please advise.
12/13/22 (12:09 p.m. email from Willis to Smith): Darlene, Yes. My
clients are confirming the language and I think I can have to you by end
of business tomorrow. Do you think you could get it signed by Friday?
If not, my office can ask for a week extension. We want to get everything
finalized by the 21st to allow my clients ample time to start scheduling
the agreed January meeting. Does this work?
12/13/22 (12:31 p.m. email from Smith to Willis): Thanks Donielle. I
will be out of Ohio beginning 12/20/22 through the first week of
January. I would love to get the document signed, if not by Friday,
certainly by Monday. Therefore, a week’s extension would work, giving
me time to get it back to you by Monday, [at] the latest.
12/13/22 (12:40 p.m. email from Willis to Smith): Great, thank you. I
will do my best to get the release to you by end of tomorrow.
12/14/22 (3:08 p.m. email from Willis to Smith): Darlene, We have a
good to go release. I’m attaching a clean copy and a copy that shows
where the last edits were made just for your ease of reference. You’ll see
6
OHIO FIRST DISTRICT COURT OF APPEALS
there were a few other minor edits I made, but they do not affect
substance. Once you get this signed by all your clients, please send back
to me with the signed dismissal and we will get the dismissal filed.
Thanks. Let me know if you have questions.
{¶8} After adding Smith’s proposed addition to the defense-and-
indemnification language, the defense-and-indemnification provision read: “The
Undersigned agree to defend and indemnify Releasees if the Undersigned or other unit
owners in the community sue Releasees for the same or substantially the same or
related claims that have been alleged in this lawsuit and to which the releasees have
substantially complied.”
{¶9} Willis obtained an extension from the trial court to file the agreement
and dismissal. After receiving no email response from Smith with a signed agreement
and dismissal, Willis sent two follow-up emails. One week later, Smith responded via
email that said: “My Clients have decided to voluntarily dismiss the case, without
prejudice. I will prepare and file the voluntary dismissal no later than this Friday.”
{¶10} The Villas and the Board filed a motion to enforce the settlement
agreement on December 27, 2022. No response was filed by the unit owners, nor was
a voluntary dismissal ever filed. However, on December 30, 2022, counsel for the unit
owners filed a motion to withdraw as counsel, stating that an attorney-client
relationship was no longer possible.
{¶11} The trial court held a hearing on these two pending motions on January
23, 2023. At the hearing, the court first heard and granted counsel for the unit owner’s
motion to withdraw. It then heard argument from counsel on the motion to enforce
the settlement agreement. The court entered an order on January 24, 2023, granting
7
OHIO FIRST DISTRICT COURT OF APPEALS
the motion to enforce, but giving the unit owners ten days to file objections to the
order. It further stated that if no objections were filed during the ten-day period, its
order granting the motion would stand. The unit owners did not file any objections.
Instead, they retained new counsel, who filed an appeal of the order granting the
motion to enforce the settlement agreement on February 22, 2023. This court
dismissed the appeal after determining that the trial court’s order was not final and
appealable.
{¶12} On August 22, 2023, approximately five months after the appeal was
dismissed, five of the unit owners, seemingly acting pro se, filed affidavits stating that
they were not in agreement with the terms contained in the settlement agreement
purportedly negotiated on their behalf and that they had not signed any document
evidencing their agreement. The unit owners further alleged that they were not
represented by counsel at the January 23 hearing and were not properly served with
the trial court’s order granting the motion to enforce the settlement agreement. The
affidavit further requested that a hearing be scheduled for the unit owners to be heard
on their “Motions.”
{¶13} On August 29, 2023, the trial court issued an “order denying
affidavits/motions.” The order stated that that the affidavits contained insufficient
grounds to set a hearing or otherwise set aside the order granting the motion to enforce
the settlement agreement, and it noted that the “motions” were filed nearly seven
months after the court’s order was issued and five months after the appeal was
dismissed. It further stated “the Court finds all matters in this case resolved or
otherwise dismissed. This is a final and appealable order and there is no just cause for
delay.”
8
OHIO FIRST DISTRICT COURT OF APPEALS
{¶14} On September 4, 2023, the unit owners, by and through counsel, filed a
Civ.R. 60(B) motion requesting relief from the trial court’s January 2023 order
granting the motion to enforce the settlement agreement. The trial court denied the
motion, stating that it was moot after the court’s final and appealable order issued on
August 29, 2023. The unit owners then appealed the August 29 order.
II. Enforcement of the Settlement Agreement
{¶15} In a single assignment of error, the unit owners argue that the trial court
erred in enforcing the settlement agreement.
{¶16} Settlement agreements are contracts between the parties “to terminate
a claim by preventing or ending litigation.” Kinnett v. Corporate Document Solutions,
Inc., 1st Dist. Hamilton No. C-180189, 2019-Ohio-2025, ¶ 18. They are highly favored
by the law as an efficient means to resolve litigation. Id.{¶17} Settlement agreements present issues of contract law. Turoczy Bonding
Co. v. Mitchell, 2018-Ohio-3173, 118 N.E.3d 439, ¶ 16 (8th Dist.). Accordingly, to be
enforceable a settlement agreement must include “an offer, acceptance, contractual
capacity, consideration (the bargained for legal benefit and/or detriment), a
manifestation of mutual assent and legality of object and of consideration.” Kostelnik
v. Helper, 96 Ohio St.3d 1, 2002-Ohio-2985, 770 N.E.2d 58, ¶ 16, quoting Perlmuter
Printing Co. v. Strome, Inc., 436 F.Supp. 409, 414 (N.D.Ohio 1976); see Kinnett at ¶
28. A meeting of the minds regarding the essential terms of the agreement is also
necessary. Kostelnik at ¶ 16; Kinnett at ¶ 28.
{¶18} While it is preferable that a settlement agreement be put in writing, “an
oral settlement agreement may be enforceable if there is sufficient particularity to
form a binding contract.” Kostelnik at ¶ 15. The terms of an oral agreement will be
9
OHIO FIRST DISTRICT COURT OF APPEALS
determined based on the parties’ “words, deeds, acts, and silence.” Id., quoting
Rutledge v. Hoffman, 81 Ohio App. 85, 75 N.E.2d 608 (12th Dist.1947), paragraph one
of the syllabus.
{¶19} The standard of review applicable to a trial court’s ruling on a motion to
enforce a settlement agreement depends on the issue presented for review on appeal.
Kinnett, 1st Dist. Hamilton No. C-180189, 2019-Ohio-2025, at ¶ 19. A de novo
standard of review will be applied to questions of law, including whether the parties
have entered into an enforceable agreement. Id. But if “the question is a factual one,
such as whether an offer and acceptance has been made, a reviewing court will not
overturn the trial court’s finding if there was sufficient evidence in the record to
support the finding.” Id.Reduction of the Agreement to Writing
{¶20} The unit owners first contend that the trial court erred in granting the
motion to enforce the settlement agreement because the parties had an intent to
reduce the agreement to writing and failed to do so.
{¶21} The Villas and the Board, however, contend that memorializing the
agreement in writing was not a material term of the parties’ agreement and that the
parties did not intend for the settlement agreement to only be enforceable upon the
execution of a signed writing.
{¶22} “[W]here all the substantial terms of a contract have been agreed on and
there is nothing left for future settlement, the fact alone that it was the understanding
that the contract should be formally drawn up and put in writing does not leave the
transaction incomplete and without binding force, in the absence of a positive
agreement that it should not be binding until so reduced to writing and formally
10
OHIO FIRST DISTRICT COURT OF APPEALS
executed.” (Emphasis sic.) Turoczy Bonding, 2018-Ohio-3173, 118 N.E.3d 439, at ¶ 22,
quoting Charvat v. Oasis Mtge., Inc., 10th Dist. Franklin No. 02AP-1090, 2003-Ohio-
2879, ¶ 13, quoting 12 American Jurisprudence, Contracts, Section 25, at 522; see PNC
Mtge. v. Guenther, 2d Dist. Montgomery No. 25385, 2013-Ohio-3044, ¶ 15. In cases
where the parties intended that a contract would not be formed until the agreement
was formally reduced to writing and signed, a settlement agreement will not be
enforceable absent such a document. PNC Mtge. at ¶ 15.
{¶23} Padula v. Wagner, 2015-Ohio-2374, 37 N.E.3d 799 (9th Dist.), and
Turoczy Bonding are instructive as we determine whether the parties in this case
intended for the settlement agreement to be contingent upon the execution of a formal,
signed writing. In Padula, the plaintiff filed a lawsuit against the defendant asserting
various claims related to the defendant’s termination of plaintiff’s employment,
including a breach-of-contract claim. Id. at ¶ 2-3. On appeal, plaintiff argued that the
trial court erred in dismissing his claim for breach of contract. He alleged that the
terms of his employment with defendant were set forth in three documents, including
a document referred to as a “term sheet” that he alleged constituted a binding contract.
Id. at ¶ 14. After examining the language of the term sheet, the Ninth District rejected
plaintiff’s claim that the term sheet was a binding contract because the document
stated multiple times that the parties intended to subsequently negotiate and finalize
a formal, binding contract extraneous to the term sheet. Id. at ¶ 16-19. It held that “[a]s
a general rule, agreements in principle and preliminary negotiations that refer to
subsequent, formal agreements are not binding.” Id. at ¶ 18.
{¶24} The Eighth District reached the opposite conclusion with respect to
whether a binding agreement had been reached by the parties in Turoczy Bonding,
11
OHIO FIRST DISTRICT COURT OF APPEALS
2018-Ohio-3173, 118 N.E.3d 439. Turoczy was a registered bail bonds company that
sued Mitchell, an independently contracted bail bond agent, for multiple causes of
action including breach of contract. Mitchell subsequently asserted counterclaims
against Turoczy. Id. at ¶ 3, 5 and 6. During the litigation, counsel for both parties
discussed a potential settlement agreement through a series of emails. Approximately
two weeks after agreeing in an email to draft a release of all claims, counsel for Mitchell
emailed opposing counsel and stated that Mitchell had changed his mind and no
longer wished to enter into a settlement agreement. Id. at ¶ 7-8.
{¶25} Turoczy filed a motion to enforce the settlement agreement, which the
trial court granted. Id. at ¶ 10 and 12. Mitchell appealed, arguing that the settlement
agreement was not enforceable because the parties had contemplated setting forth the
terms of their agreement in a signed, written document. Id. at ¶ 20. The Eighth District
affirmed the trial court’s grant of the motion to enforce. It held that despite the fact
that the settlement offer contemplated a future memorialized agreement, “the email
communications reflect a definite offer and acceptance, bargained for consideration,
and the parties’ clear understanding of the settlement terms” and “did not expressly
state that the agreement would not become binding until it was formally executed.” Id.
at ¶ 23.
{¶26} The facts of the case at bar are much more similar to those in Turoczy
Bonding than those in Padula. Unlike the document involved in Padula, the
settlement agreement between the unit owners and the Board and the Villas did not
contain any provision stating that the agreement was conditional upon the execution
of a written and signed contract. Rather, as in Turoczy Bonding, counsel for both
parties exchanged a series of emails negotiating the wording of the settlement
12
OHIO FIRST DISTRICT COURT OF APPEALS
agreement, and then one party—in this case, the unit owners—refused to sign the
settlement agreement. The email communications between counsel reflected a definite
offer and acceptance of all terms, including the defense-and-indemnification
provision, and bargained-for consideration. None of the email communications
contained language making a final settlement contingent on execution of a written
document.
{¶27} Further indicative that the parties did not intend for the settlement
agreement to be binding only upon the execution of a signed writing is that counsel for
both parties reported to the trial court that a settlement had been reached before the
settlement document was drafted.
{¶28} On this record, we hold that while the parties intended to memorialize
their agreement in writing, they did not intend for the binding nature of the agreement
to be contingent upon the execution of a signed writing. The trial court did not err in
granting the motion to enforce the agreement in the absence of a writing signed by
both parties.
Meeting of the Minds
{¶29} The unit owners further argue that the trial court erred in granting the
motion to enforce the settlement agreement because the parties never reached a
meeting of the minds as to all of the agreement’s essential terms. We are not
persuaded.
{¶30} A meeting of the minds occurs where the parties have “mutually
assent[ed] to the substance of the exchange.” Turoczy Bonding, 2018-Ohio-3173, 118
N.E.3d 439, at ¶ 18. The settlement agreement in this case contains all material terms
of the parties’ agreement, including the Board’s agreement to hold meetings three
13
OHIO FIRST DISTRICT COURT OF APPEALS
times a year, the length of the meetings, and “atmosphere guidelines” to govern the
meetings. The email exchange between counsel establishes that both parties mutually
assented to all of these terms.
{¶31} The only provision in the settlement agreement that potentially
remained in dispute was the defense-and-indemnification provision. As set forth
above, the unit owners initially objected to the defense-and-indemnification
provision. But the emails between counsel establish that after speaking in a phone call,
the issue was resolved. The unit owners’ counsel emailed counsel for the Villas and the
Board to verify that their suggested language was added to this provision. Counsel for
the Villas and the Board responded affirmatively, confirming the added language and
shortly thereafter sent an updated agreement and dismissal.1
{¶32} The parties dispute whether the defense-and-indemnification provision
is a material term of the settlement agreement. Regardless, the record establishes that
not only the material terms, but all provisions in the settlement agreement, including
the defense-and-indemnification provision, were agreed to by the parties. We
accordingly hold that the trial court did not err in granting the motion to enforce the
settlement agreement. The unit owners’ assignment of error is overruled.
III. Conclusion
{¶33} Because the parties did not intend for the settlement agreement to only
be binding upon the execution of a signed writing, and because the parties reached a
1 The unit owners argued that there was no meeting of the minds because they themselves did not
participate in the settlement negotiations. However, they were represented by counsel who
properly negotiated on their behalf. See Wilson v. Pride, 8th Dist. Cuyahoga No. 107793, 2019-
Ohio-3513, ¶ 34 (“when a client authorizes his or her attorney to negotiate a settlement and the
attorney negotiates a settlement within the scope of that authority, the client is bound by it”);
Bromley v. Seme, 2013-Ohio-4751, 3 N.E.3d 1254, ¶ 25 (11th Dist.) (holding that, in reaching a
settlement agreement, a party may be bound by the conduct of her or his attorney).
14
OHIO FIRST DISTRICT COURT OF APPEALS
meeting of the minds as to all essential terms of the agreement, the trial court’s
judgment granting the motion to enforce the settlement agreement is affirmed.
Judgment affirmed.
ZAYAS, P.J., and WINKLER, J., concur.
Please note:
The court has recorded its entry on the date of the release of this opinion.
15