EAC Properties, L.L.C. v. Brightwell , 2014 Ohio 2078 ( 2014 )

[Cite as EAC Properties, L.L.C. v. Brightwell, 2014-Ohio-2078.]
IN THE COURT OF APPEALS OF OHIO
TENTH APPELLATE DISTRICT
EAC Properties, L.L.C., :
Plaintiff-Appellant, :
v. : No. 13AP-773
(C.P.C. No. 08CV-17284)
Robert R. Brightwell, D.O., :
(REGULAR CALENDAR)
Defendant-Appellee. :
D E C I S I O N
Rendered on May 15, 2014
Murray, Murphy, Moul + Basil, LLP, Brian K. Murphy, and
Robert H. Miller, for appellant.
Innis & Barker Law, LLC, and Larry D. Barker, for appellee.
APPEAL from the Franklin County Court of Common Pleas
CONNOR, J.
{¶ 1} Plaintiff-appellant, EAC Properties, L.L.C. ("EAC"), appeals from a
judgment of the Franklin County Court of Common Pleas granting the motion for
attorney's fees filed by defendant-appellee, Robert R. Brightwell, D.O. EAC assigns the
following sole assignment of error for our review:
The trial court erred as a matter of law in awarding
attorney's fees to a non-prevailing party contrary to the
parties' agreement.
{¶ 2} Because the trial court correctly determined that Brightwell was the
prevailing party, and thus entitled to attorney's fees, we affirm.
No. 13AP-773 2
I. FACTS & PROCEDURAL HISTORY
{¶ 3} EAC filed a complaint against Brightwell on December 4, 2008. EAC
asserted that Brightwell, a tenant in a building owned by EAC, owed EAC $33,045.60 in
unpaid rent and $5,226.92 in unpaid fees for utilities, maintenance, insurance, and
other related charges. The trial court ultimately determined that EAC had waived its
right to the rent payments, but that Brightwell owed EAC $3,703.97 for unpaid utility
expenses.
{¶ 4} This is the third appeal arising from the underlying action. See EAC
Properties, LLC v. Brightwell, 10th Dist. No. 10AP-853, 2011-Ohio-2373; EAC
Properties, LLC v. Brightwell, 10th Dist. No. 12AP-347, 2012-Ohio-5385 ("EAC
Properties II"). The instant action concerns the trial court's second ruling on
Brightwell's motion for attorney's fees, following this court's reversal of the trial court's
first ruling on the motion for attorney's fees in EAC Properties II. As we have thoroughly
set forth the facts of the action in our prior decision, we adopt the statement of facts
presented in EAC Properties II which follows:
This matter arises from a dispute over rent and utility
payments due on property owned by EAC and leased by
Brightwell. EAC filed a complaint against Brightwell in
December 2008, alleging breach of the lease agreement. A
magistrate of the trial court held a bench trial. Important for
our purposes here, during the trial, counsel for the parties
addressed the issue of awarding attorney fees upon a finding
of a prevailing party. The parties agreed that they would not
submit evidence on fees at the trial, but would submit the
fees by affidavit once a prevailing-party determination had
been made. The magistrate said: "Great. Then we will not
take any evidence on fees. I will not make a decision on fees.
I will merely put who is the prevailing party. And, then,
hopefully, the parties can work that out without any
additional hearing." (Tr. 66.)
Following the trial, in his decision, the magistrate concluded
that the parties had modified the terms of the lease, and
EAC's conduct waived its ability to recover the back-rental
payments it sought from Brightwell. The magistrate also
concluded, however, that Brightwell owed EAC $3,703.97 for
unpaid utility expenses. Because EAC held Brightwell's
security deposit of $3,147.30, the magistrate awarded EAC
No. 13AP-773 3
$556.67 for the unpaid utilities. The magistrate's decision
also stated the following:
Claim for Attorney Fees:
Both parties have asserted that the lease between the parties
contained a fee shifting provision awarding attorney fees to
the 'prevailing party'. The undersigned finds that both sides
have prevailed in part.
EAC objected to the magistrate's findings of fact and
conclusions of law, including the magistrate's finding that
both parties had prevailed. EAC contended that it "was
awarded damages and should be deemed the prevailing party
under the terms of the Lease and should be awarded
attorney's fees." In response, Brightwell argued that EAC's
"point is difficult to understand when clearly the Magistrate
provided that [Brightwell] won on the issue of rent and that
[EAC] won on the issue of utilities. Therefore, the attorney
fees portion of the agreement has been nullified."
The trial court overruled EAC's objections and adopted the
magistrate's decision. On the issue of prevailing-party status,
the court stated:
The Supplemental Objection regarding prevailing party for
the purpose of attorneys' fees fails. The Plaintiff's primary
claim for additional rent failed. Plaintiff waived the lease
terms which entitled her to additional rent by her conduct in
spite of the Lease provision which prohibited waiver. Lease
¶ 24. The Magistrate awarded a small sum for utilities, but
deducted that from the security deposit. Dec. at 11. To bring
suit and request over $30,000 and be awarded roughly $550
is by any definition a win [sic]. Plaintiff did not prevail, and
is not entitled to attorneys fees.
On appeal, this court affirmed. See EAC Properties v.
Brightwell, 10th Dist. No. 10AP-853, 2011-Ohio-2373. EAC
did not raise, and this court did not address, the issue of
prevailing-party status or attorney fees. The Supreme Court
of Ohio declined jurisdiction to review the decision.
On October 24, 2011, Brightwell submitted to the trial court
a motion for reasonable attorney fees and costs. He asked for
judgment in the amount of $8,868 pursuant to Section 36 of
the Lease Agreement. That section, he argued, provided that,
if one of the parties were required to enforce any provision of
No. 13AP-773 4
the lease agreement, then " 'the prevailing party shall be
entitled to its reasonable attorney fees and costs in
connection with such action.' "
On November 23, 2011, EAC filed a memorandum in
opposition to Brightwell's motion. In it, EAC contended that
Brightwell was not entitled to fees and costs because he did
not prevail.
On March 20, 2012, the trial court issued a decision and
entry granting Brightwell's motion for attorney fees and
costs. In it, the trial court stated: "The Defendant's Motion is
not opposed." Upon determining that the fees were
reasonable, the court stated: "The Court previously found the
Defendant prevailed. Trial court's August 5, 2010 Decision at
page 8. The Court therefore grants Defendant's Motion and
awards Defendant $8,868.00 in attorney's fees and costs."
EAC Properties II at ¶ 2-9.
{¶ 5} In EAC Properties II, we reversed the trial court's March 20, 2012 decision
and entry finding numerous inconsistencies in the trial court's orders which required
clarification. We noted that the trial court stated in the March 20, 2012 decision and
entry that Brightwell's motion for attorney's fees was unopposed, but the record
demonstrated that EAC had filed a memorandum in opposition to Brightwell's motion
on November 23, 2011. We also noted the inconsistency in the trial court's August 9,
2010 decision and entry overruling EAC's objections to the magistrate's decision,
wherein the court stated that the award to EAC of roughly $550 was "by any definition a
win," but then further stated that "[EAC] did not prevail, and [was] not entitled to
attorneys fees." (Aug. 9, 2010, Decision and Entry, 8.)
{¶ 6} Following remand, the trial court again granted Brightwell's motion for
attorney's fees. The court noted that it had specifically considered EAC's memorandum
in opposition, and clarified that the August 9, 2010 decision and entry contained "the
mistaken misnomer referring to 'win.' " (August 7, 2013, Decision and Entry, 1.) The
court concluded that Brightwell had prevailed in this action, as Brightwell had prevailed
on its defense of waiver. Accordingly, the court held that Brightwell "prevailed on its
defense regarding * * * [EAC's] primary claim which was for back rent, and is entitled to
No. 13AP-773 5
an award of attorney's fees pursuant to the Lease." (August 7, 2013, Decision and Entry,
2.)
II. BRIGHTWELL WAS THE PREVAILING PARTY
{¶ 7} EAC asserts that, for purposes of the fee-shifting provision in the lease
agreement, Brightwell was not a prevailing party in this action. EAC bases its argument
on the fact that Brightwell was ordered to pay EAC $556.67 in unpaid utilities expenses.
EAC thus asserts that, as it received a monetary judgment in its favor, there can be no
argument that Brightwell prevailed in this action. For the reasons that follow, we
disagree.
{¶ 8} Ohio courts follow the so-called "American rule," which requires that each
party involved in litigation pay his or her own attorney fees. McConnell v. Hunt Sports
Ent., 132 Ohio App.3d 657, 699 (10th Dist.1999), citing Sorin v. Bd. of Edn. of
Warrensville Hts. School Dist., 46 Ohio St.2d 177, 179 (1976). There are three well-
recognized exceptions to this rule: (1) where statutory provisions specifically provide
that a prevailing party may recover attorney fees, (2) where there has been a finding of
bad faith, and (3) where the contract between the parties provides for fee shifting. Id.,citing Pegan v. Crawmer, 79 Ohio St.3d 155, 156 (1997). Fee-shifting contractual
provisions are generally enforceable " 'so long as the fees awarded are fair, just and
reasonable as determined by the trial court upon full consideration of all of the
circumstances of the case.' " Southeast Land Dev., Ltd. v. Primrose Mgt., L.L.C., 193
Ohio App.3d 465, 2011-Ohio-2341, ¶ 15 (3d Dist.), quoting Wilborn v. Bank One Corp.,
121 Ohio St.3d 546, 2009-Ohio-306, ¶ 8.
{¶ 9} "When an award of attorney fees is not authorized by statute or by
contract, the award is a matter of the trial court's sound discretion." Keal v. Day, 164
Ohio App.3d 21, 2005-Ohio-5551, ¶ 7 (1st Dist.). The interpretation of a written contract,
however, is a question of law. Id., citing Alexander v. Buckeye Pipe Line Co., 53 Ohio
St.2d 241 (1978), paragraph one of the syllabus. Accordingly, here, the trial court's
interpretation of the fee-shifting provision in the lease agreement is subject to de novo
review. See Long Beach Assn., Inc. v. Jones, 82 Ohio St.3d 574, 576 (1998), citing Ohio
Bell Tel. Co. v. Pub. Util. Comm., 64 Ohio St.3d 145, 147 (1992). Absent ambiguity in the
No. 13AP-773 6
language of the contract, the parties' intent must be determined from the plain language
of the document. See Hybud Equip. Co. v. Sphere Drake, 64 Ohio St.3d 657, 665 (1992).
{¶ 10} In this case, the addendum to the parties' lease agreement, signed by the
parties on August 14, 2003, provides that "[i]f either party is required to commence any
action at law or equity against the other party to enforce any provision of this Lease, the
prevailing party shall be entitled to the reasonably attorneys' fees and costs in
connection with such action." (Lease Agreement, Addendum.) The lease thus allowed
for the shifting of attorney's fees. Accordingly, the sole issue in this appeal is whether
Brightwell was the prevailing party in the underlying action.
{¶ 11} "Black's Law Dictionary (9th ed.2009) defines 'prevailing party' as '[a]
party in whose favor a judgment is rendered, regardless of the amount of damages
awarded.' " Hikmet v. Turkoglu, 10th Dist. No. 08AP-1021, 2009-Ohio-6477, ¶ 73,
quoting Black's Law Dictionary (9th Ed.2009). "A 'prevailing party' is generally the
party ' "in whose favor the decision or verdict is rendered and judgment entered." ' " Id.
at ¶ 74, quoting Hagemeyer v. Sadowski, 86 Ohio App.3d 563, 566 (6th Dist.1993),
quoting Yetzer v. Henderson, 5th Dist. No. CA-1967 (June 4, 1981). In Hikmet, this
court further defined "prevailing party" as:
The party to a suit who successfully prosecutes the action or
successfully defends against it, prevailing on the main issue,
even though not necessarily to the extent of his original
contention. The one in whose favor the decision or verdict is
rendered and judgment entered. * * * To be such does not
depend upon the degree of success at different stages of the
suit, but whether, at the end of the suit, or other proceeding,
the party who had made a claim against the other, has
successfully maintained it.
Id. at ¶ 75, citing Moga v. Crawford, 9th Dist. No. 23965, 2008-Ohio-2155, ¶ 6.
{¶ 12} EAC acknowledges that it did not "prevail to the extent of its original
contention," but asserts that, as a monetary judgment of $556.67 was entered in its
favor, Brightwell cannot be considered a prevailing party in this action. (Appellant's
brief, 10.) EAC's argument ignores the fact that Brightwell prevailed on the main issue in
the case, which was over $30,000 EAC claimed it was due in back rent. Brightwell
asserted that EAC had waived its right to those rental payments, and Brightwell
No. 13AP-773 7
prevailed on that affirmative defense. In overruling EAC's objections to the magistrate's
decision, the trial court acknowledged that Brightwell had prevailed, noting that the
"main issue here [was] waiver. The Court agrees [EAC] waived the lease provisions
related [to] rent." (Aug. 9, 2010, Decision and Entry, 8.) Accordingly, as Brightwell
prevailed on the main issue in the action, the court properly concluded that Brightwell
was the prevailing party for purposes of the fee-shifting provision in the lease.
{¶ 13} The fact that EAC received a monetary award for the outstanding utilities
does not alter our conclusion. EAC brought suit against Brightwell alleging that
Brightwell owed EAC over $30,000 in back rent; EAC failed to successfully maintain
that action. Although EAC brought suit requesting over $5,000 for back utilities,
maintenance, and insurance payments, and the court determined that EAC was entitled
to $3,703.97 in utility fees, the utilities award does not alter the fact that Brightwell was
the prevailing party on the main issue in the action. Compare Landefeld v. State Med.
Bd. of Ohio, 10th Dist. No. 99AP-612 (June 15, 2000), quoting Civ.R. 54(D) (concluding
that the appellant-doctor was not a prevailing party for purposes of Civ.R. 54(D), which
provides that " 'costs shall be allowed to the prevailing party unless the court otherwise
directs,' " where, although "some of the charges were found by the trial court to be
unsupported by the evidence, the ultimate outcome in the underlying action was
revocation of appellant's license," and the appellant thus "did not prevail on the main
issue of his appeal"); Kleemann v. Carriage Trace, Inc., 2d Dist. No. 21873, 2007-Ohio-
4209, ¶ 101; Vance v. Roedersheimer, 64 Ohio St.3d 552, 555 (1992) (noting that "[a]
party who goes into such a trial with an [arbitration] award of $10,000 and emerges
with $5,000 can hardly be said to have prevailed" for purposes of Civ.R. 54(D)).
{¶ 14} Based on the foregoing, EAC's sole assignment of error is overruled.
III. DISPOSITION
{¶ 15} Having overruled EAC's sole assignment of error, we affirm the judgment
of the Franklin County Court of Common Pleas.
Judgment affirmed.
TYACK and KLATT, JJ., concur.
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