BT Environmental Solutions, Inc. v. BT Energy Group, Inc. , 2015 Ohio 4147 ( 2015 )

[Cite as BT Environmental Solutions, Inc. v. BT Energy Group, Inc., 2015-Ohio-4147.]
STATE OF OHIO, COLUMBIANA COUNTY
IN THE COURT OF APPEALS
SEVENTH DISTRICT
BT. ENVIRONMENTAL SOLUTIONS )
LLC, )
)
PLAINTIFF-APPELLANT, ) CASE NO. 14 CO 44
)
V. ) OPINION
)
B.T. ENERGY GROUP, INC. et al., )
)
DEFENDANTS-APPELLEE )
COUNTERCLAIMANTS AND )
THIRD PARTY PLAINTIFFS, )
)
V. )
)
DAVID TOD, JR., )
)
THIRD PARTY DEFENDANT- )
COUNTERCLAIMANT AND )
CROSS-CLAIMANT. )
CHARACTER OF PROCEEDINGS: Civil Appeal from Court of Common
Pleas of Columbiana County, Ohio
Case No. 2013 CV 524
JUDGMENT: Reversed and Remanded
JUDGES:
Hon. Gene Donofrio
Hon. Cheryl L. Waite
Hon. Carol Ann Robb
Dated: September 30, 2015
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APPEARANCES:
For Plaintiff-Appellant Attorney Charles E. Dunlap
7330 Market St.
Youngstown, Ohio 44512
For Third Party Appellant Attorney Dean S. Hoover
5 Atterbury Boulevard
Hudson, Ohio 44236
For Defendant-Appellee Attorney Timothy A. Barry
600 East State Street, P.O. Box 590
Salem, Ohio 44460
[Cite as BT Environmental Solutions, Inc. v. BT Energy Group, Inc., 2015-Ohio-4147.]
DONOFRIO, P.J.
{¶1} Plaintiff-appellant, BT Environmental Solutions, LLC, appeals from a
Columbiana County Common Pleas Court judgment granting summary judgment in
favor of defendant-appellee, Lizabeth Beight.
{¶2} Appellant is an Ohio limited liability company. Steven Beight and David
Tod, Jr. formed appellant in 2012. Steven Beight and David Tod, Jr. also formed B.T.
Energy Group, Inc. Appellee is Steven Beight’s wife. Appellee never worked for
appellant.
{¶3} Steven Beight initially invested $100 in appellant. David Tod, Sr.
invested $50,000 and Daniel J. and Daniel P. O’Horo invested $500,000.
{¶4} During 2012, Steven Beight purchased four trucks for appellant.
Appellant’s money was used to purchase the trucks. Three of the trucks were titled
in Steven Beight’s name and the third truck was titled in appellee’s name. Steven
Beight later sold all of the trucks.
{¶5} On August 13, 2012, Steven Beight issued a check to appellee for
$939.96 using appellant’s funds with the memo “2 F350 truck payments.” Beight
stated that appellee had made two truck payments with her personal funds and he
reimbursed her.
{¶6} During the approximately 14 months appellant was in business, Steven
Beight received $2,200 per week and deposited it into his joint checking account with
appellee.
{¶7} On August 26, 2013, appellant filed a complaint against appellee,
Steven Beight, and B.T. Energy Group alleging conversion of appellant’s funds and
assets and also asserting a civil RICO claim. Also named in the complaint were
Clearwater Shale Services, LLC, and Water-N-Hole, LLC, two companies that
appellee was involved with. Steven Beight filed a third-party complaint against David
Tod, Jr. raising various claims. Tod, Jr. then asserted various cross-claims in
response against Steven Beight, appellee, and the other defendants, including claims
for fraud and conversion.
{¶8} Next, appellee, along with Clearwater Sales and Water-N-Hole, filed a
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motion for summary judgment on the original complaint and Tod, Jr.’s cross-claims.
They argued that they never exercised dominion and control over appellant’s money
and assets.
{¶9} Appellant filed a response stating that it did not oppose summary
judgment as to Clearwater and Water-N-Hole. But it did oppose summary judgment
as to appellee, as it alleged she conspired with Steven Beight in committing illegal
and fraudulent acts against it.
{¶10} The trial court granted summary judgment in favor of appellee,
Clearwater, and Water-N-Hole. In doing so it found that appellee’s and Steven
Beight’s affidavits were unopposed on two facts. First, appellee was not and never
had been an owner, officer, manager, or employee of appellant. Second, the only
connection between appellee and appellant was a Ford truck that was purchased
and used for appellant’s business that was registered in appellee’s name so that
Steven Beight could retain a personalized license plate. Therefore, the court found
that appellee demonstrated she did not convert, receive, transfer, or steal money or
assets from appellant. It further found that other than being listed as the title owner
of the Ford truck, appellee had no connection with appellant.
{¶11} On appellant’s motion, the trial court subsequently entered another
judgment severing appellee as a party, stating that its order was final and
appealable, and adding the language “no just reason for delay.” Appellant then filed
a timely notice of appeal on October 22, 2014.
{¶12} Appellant now raises a single assignment of error. It states:
THE TRIAL COURT ERRED WHEN IT GRANTED SUMMARY
JUDGMENT TO DEFENDANT LIZABETH BEIGHT.
{¶13} Appellant argues that, contrary to the trial court’s finding, it did carry its
reciprocal burden and established a genuine issue of material fact. Specifically,
appellant points to citations in Steven Beight’s deposition in its response to the
motion for summary judgment. Appellant asserts the deposition established that the
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2012 Ford truck was paid for using appellant’s money and was titled in appellee’s
name. It further asserts it established that Steven Beight paid $202,094.50 in wages
to himself, his son, and his friends in 2012, without the authority to do so. And it
established that Steven Beight personally received $90,000 of those wages, which
he deposited into a joint checking account with appellee. Additionally, appellant
states the deposition established that when the truck was sold, Steven reimbursed
himself and appellee and opened a new checking account. Finally, appellant states
the deposition revealed that appellee received some of the money from the sale of
the truck. Based on this evidence, appellant argues, the trial court should have found
a genuine issue of material fact as to whether appellee participated in the defalcation
of her husband and shared in the illegal proceeds.
{¶14} In reviewing a trial court's decision on a summary judgment motion,
appellate courts apply a de novo standard of review. Cole v. Am. Industries &
Resources Corp., 128 Ohio App. 3d 546, 552, 715 N.E.2d 1179 (7th Dist.1998).
Thus, we shall apply the same test as the trial court in determining whether summary
judgment was proper. Civ.R. 56(C) provides that the trial court shall render summary
judgment if no genuine issue of material fact exists and when construing the
evidence most strongly in favor of the nonmoving party, reasonable minds can only
conclude that the moving party is entitled to judgment as a matter of law. State ex
rel. Parsons v. Fleming, 68 Ohio St. 3d 509, 511, 628 N.E.2d 1377 (1994). A
“material fact” depends on the substantive law of the claim being litigated. Hoyt, Inc.
v. Gordon & Assoc., Inc., 104 Ohio App. 3d 598, 603, 662 N.E.2d 1088 (8th
Dist.1995), citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-248, 106 S. Ct.
2505, 91 L. Ed. 2d 202 (1986).
{¶15} In this case, appellant raised claims against appellee for conversion
and a civil RICO violation.
{¶16} Conversion is the wrongful exercise of dominion over property to the
exclusion of the property owner or withholding property from the owner's possession
under a claim inconsistent with the owner's rights. Joyce v. Gen. Motors Corp., 49
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Ohio St.3d 93, 96, 551 N.E.2d 172 (1990). The elements of a conversion action are:
(1) the plaintiff had ownership or right of possession of the property at the time of
conversion; (2) the defendant's conversion of plaintiff's property by a wrongful act or
disposition; and (3) resulting damages. Dice v. White Family Cos., Inc., 173 Ohio
App.3d 472, 878 N.E.2d 1105, 2007-Ohio-5755, ¶17 (2d Dist.).
{¶17} A valid civil RICO claim must allege that the defendant committed one
or more of the violations set forth in R.C. 2923.32. Salata v. Vallas, 159 Ohio App.
3d 108, 2004-Ohio-6037, 823 N.E.2d 50, ¶10 (7th Dist.). Additionally, the claim must
state with specificity (1) that the defendant was involved in a “corrupt activity,” (2) that
the defendant was involved in a pattern of corrupt activity that consisted of two or
more incidents of corrupt activity, and (3) that an enterprise existed separate and
apart from the defendant through which the defendant acted. Id., citing Universal
Coach, Inc. v. New York City Transit Auth., Inc., 90 Ohio App. 3d 284, 291, 629
N.E.2d 28 (8th Dist.1993).
{¶18} In her affidavit, appellee stated that she has never been appellant’s
owner, officer, manager, or employee. (L. Beight Aff. ¶1). She averred that her only
involvement with appellant was when Steven Beight put the title to a truck that he
purchased with appellant’s funds in her name. (L. Beight Aff. ¶2). She further
averred that she did not drive the truck or use it for personal purposes and that on
February 20, 2013, she transferred the title to Steven Beight. (L. Beight Aff. ¶¶3-4).
Appellee stated that she has not had any involvement with her husband’s business
ventures with appellant or any other business. (L. Beight Aff. ¶14). And she stated
that she was not paid any money by appellant as a salary or for any other reason. (L.
Beight Aff. ¶17).
{¶19} Steven Beight’s affidavit corroborated that of his wife. Steven Beight
averred that he purchased the Ford truck in question for business purposes and used
it solely for business purposes. (S. Beight Aff. ¶¶4, 6). He stated the reason he put
the title to the truck in appellee’s name was so that he could keep the vanity license
plate “BEIGHT1,” which was already in appellee’s name, and transfer it to the truck.
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(S. Beight Aff. ¶¶7-8). Steven stated he was told the only way to keep the vanity
plate that was issued to appellee was to put the title of the truck in her name. (S.
Beight Aff. ¶9). He further stated that he sold the truck to Donnell Ford in March
2013 and placed the funds he received in appellant’s checking account. (S. Beight
Aff. ¶10).
{¶20} Evidence exists in the record, however, that creates genuine issues of
material fact.
{¶21} Steven Beight’s deposition established that the 2012 Ford truck was
paid for using appellant’s money and was titled in appellee’s name. (S. Beight Dep.
33-36). Steven Beight stated that when the truck was sold back to Donnell Ford,
Donnell issued the check to him. (S. Beight Dep. 44). He stated Donnell was able to
do this because the truck was put in either his name or appellant’s name prior to the
sale back to Donnell. (S. Beight Dep. 45). Notably, however, Beight did not have a
copy of this alleged second title to the truck. (S. Beight Dep. 45). The only title to the
truck that was offered as evidence listed appellee as the owner. (S. Beight Dep. Ex.
5, p. 4). This evidence creates a genuine issue of material fact as to who the title
owner was when the truck was sold back to Donnell Ford and who actually received
the proceeds of the sale.
{¶22} Moreover, David Tod, Jr. stated in his deposition that when Steven
Beight sold appellant’s equipment, he deposited that money into a PNC checking
account. (Tod, Jr. Dep. 104). He further stated that this money then went into the
Beight’s personal checking account. (Tod, Jr. Dep. 104). And Steven Beight’s
deposition established that Steven paid himself $90,000 in wages from appellant,
which he deposited into the joint checking account that he held with appellee. (S.
Beight Dep. 67-78, 79, Ex. 11). Additionally, Steven Beight stated that he wrote a
check payable to appellee on August 13, 2012, with the memo “2 F350 truck
payments.” (S. Beight Dep. 94). Steven stated that appellee had made two truck
payments out of her own pocket and he reimbursed her. (S. Beight Dep. 94). This
evidence is sufficient to create a genuine issue of material fact as to whether
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appellee knowingly exerted control over appellant’s funds and assets. While
appellee denies having any involvement with appellant’s funds and assets, there is
evidence to suggest she may have participated to some degree in her husband’s
management of appellant’s monies.
{¶23} In sum, appellant put forth enough evidence to create a genuine issue
of material fact as to whether appellee exercised dominion or control over appellant’s
money or assets and whether she engaged in a pattern of corrupt activity. Therefore,
the trial court should not have granted summary judgment in her favor.
{¶24} Accordingly, appellant’s sole assignment of error has merit.
{¶25} For the reasons stated above, the trial court’s judgment is hereby
reversed. This matter is remanded to the trial court for further proceedings pursuant
to law and consistent with this opinion.
Waite, J., concurs.
Robb, J., concurs.