Father's House Internatl., Inc. v. Kurguz , 2016 Ohio 5945 ( 2016 )

[Cite as Father's House Internatl., Inc. v. Kurguz, 2016-Ohio-5945.]
IN THE COURT OF APPEALS OF OHIO
TENTH APPELLATE DISTRICT
The Father's House International, Inc., :
Plaintiff-Appellee, :
No. 15AP-1046
v. : (C.P.C. No. 13CV-8622)
Timothy M. Kurguz, : (REGULAR CALENDAR)
Defendant-Appellant. :
D E C I S I O N
Rendered on September 22, 2016
On brief: Doucet & Associates Co., L.P.A., and Andrew J.
Gerling, for appellee. Argued: Andrew J. Gerling.
On brief: John L. Onesto, for appellant. Argued: John L.
Onesto.
APPEAL from the Franklin County Court of Common Pleas
SADLER, J.
{¶ 1} Defendant-appellant, Timothy M. Kurguz, appeals from a judgment of the
Franklin County Court of Common Pleas in favor of plaintiff-appellant, The Father's
House International, Inc. For the reasons that follow, we affirm.
I. FACTS AND PROCEDURAL HISTORY
{¶ 2} Appellant is the owner of certain commercial real estate in the city of
Columbus, Ohio ("city"). Appellee is a non-profit organization. On September 29, 2010,
the parties entered into a land installment sales contract ("contract") whereby appellant
agreed to purchase certain commercial land and buildings located at 511 Industrial Mile
Road in Columbus, Ohio for a total purchase price of $550,000. The contract provided
that appellee was to pay 12 monthly installments of $2,500, followed by 48 monthly
No. 15AP-1046 2
installments of $3,300, and a balloon payment for the remaining purchase price on the
61st month. (Pl.'s Ex. 2, paragraph 2.1.) Appellee was also responsible for the payment of
taxes and utilities.
{¶ 3} On or about September 29, 2010, appellee took possession of the property.
Pursuant to a subsequent agreement between appellee and the city, the city's Community
Shelter Board ("Shelter Board") provided more than $100,000 in grant funding to
appellee for improvements to the property required by the Shelter Board in order to
sublease the property to the Y.M.C.A. for the operation of a homeless shelter.1 In October
2012, appellant, as the property owner, submitted an application to the city for a
certificate of zoning compliance, commercial construction, wherein appellant identified
the intended use of the property as "social services/overflow homeless shelter." (Pl.'s Ex.
9.) Appellee subsequently made more than $128,000 worth of improvements to the
property over the next two years.
{¶ 4} According to appellee, on or about August 2011, appellee, by and through
Pastor Bobby Mitchell and Pastor John Hensley, met with appellant regarding a proposed
modification to the terms of the contract. According to appellee, as a result of that
meeting, the parties agreed to an oral modification of the contract whereby the monthly
installment payments were to remain at $2,500 per month after the initial 12-month
period with a corresponding increase in the balloon payment on the 61st month. Appellee
further claims that, pursuant to the modified contract, if appellee failed to pay the full
balance of the contract on or before November 2013, appellant would regain possession of
the property including the improvements. Appellant has denied that such a modification
occurred.
{¶ 5} In September 2012, the Shelter Board began leasing the premises from
appellee at a monthly rent of $5,500. On April 12, 2013, appellant sent a letter to appellee
entitled "Notice of Forfeiture and Notice to Leave," wherein appellant declares a default of
the contract and demands payment as follows: "[n]on-payment of water services * * * in
excess of $2,700.00"; "[n]on-payment of electric services * * * of $9,227.85, for which the
vendor has threatened to file a mechanic's lien"; and "[n]on-payment of monthly
1 The city of Columbus is not a party to this action.
No. 15AP-1046 3
installment[s] * * * in the mount of $13,600..00" (Pl.'s Ex. 13.) In June 2013, when the
parties could not reconcile their differences, appellee stopped making payments under the
contract. In August 2013, the lease between appellee and the city terminated and the
Y.M.C.A. vacated the premises.
{¶ 6} On or about August 5, 2013, appellant filed an eviction action against
appellee captioned Kurguz v. Father's House, Franklin Cty. M.C. No. 2013 CVG 0249858.
On August 6, 2013, appellee filed the instant action against appellant in the Franklin
County Court of Common Pleas alleging statutory violations, unjust enrichment, quantum
meruit, and breach of contract. On August 20, 2013, appellee's legal counsel sent a letter
to appellant notifying appellant that appellee was rescinding the contract and vacating the
property. 2 As of the date of the letter, appellee had made installment payments under the
contract totaling $80,000. On October 16, 2013, appellant filed an answer to the
complaint and a counterclaim seeking damages for breach of contract and declaratory
relief.
{¶ 7} On January 10, 2014, the trial court issued a decision on appellant's motion
for partial summary judgment whereby the trial court cancelled the contract and
extinguished any equitable interest appellee may have had in the property. The parties
subsequently filed cross-motions for summary judgment on the remaining claims in the
case. On October 27, 2014, the trial court issued a decision and entry partially granting
both motions. The trial court determined that the only reasonable conclusion to draw
from the evidence submitted in connection with the motion for summary judgment was
that the parties orally modified the contract with regard to the monthly installment
payments and that appellant breached the contract by demanding installment payments
in excess of the amount required by the contract, as modified. Additionally, the trial court
determined that the only reasonable conclusion to draw from the evidence submitted in
connection with the motion for summary judgment was that appellee also breached the
contract by failing to timely pay taxes and utilities. The trial court held that genuine
2 Appellant claims that appellee's lease agreement with the city terminated due to appellee's decision to
rescind the contract.
No. 15AP-1046 4
issues of material fact existed as to which of the parties first committed a breach of the
contract and whether that breach was material to the contract.3
{¶ 8} The case was subsequently tried to a jury. The jury found in favor of
appellee as to the claim for breach of contract set out in the complaint and awarded
damages of $62,000. The jury found in appellee's favor on the counterclaim. In
responding to interrogatories, the jury found that appellant had materially breached the
contract and that appellee had substantially performed the contract. On October 22,
2015, the trial court entered judgment in favor of appellee in accordance with the jury
verdict. In its judgment entry, the trial court expressly found "no just cause for delay."4
{¶ 9} Appellant filed a notice of appeal to this court from the judgment of the trial
court.
II. ASSIGNMENTS OF ERROR
{¶ 10} Appellant assigns the following as error:
I. It was error for the Trial Court to refuse to charge the jury
with the Defendant/Appellant's requested instruction that the
measure of damages for breach of a land contract is the
difference between the contract price and the value of the real
estate at the time of the breach.
II. It was error for the trial court to overrule
Defendant/Appellant's motion for directed verdict based on
Plaintiff/Appellee's failure to prove its damages to a
reasonable certainty. Further, the Trial Court overruled
Defendant/Appellant's motion notwithstanding the verdict
after the jury returned its verdict.
III. It was error for the Trial Court to give the instruction … "If
you find by the greater weight of the evidence that the plaintiff
elected to rescind the contract or cancel the contract.…"
IV. If it was not error for the Trial Court to give the instruction
stated in Assignment of Error III, above, regarding whether
Father's House rescinded the contract, the Trial Court erred
by not giving the instruction that the jury could award Kurguz
the fair rental value of Father's House occupancy of the real
3 The trial court further determined that R.C. Chapter 5313 did not apply to the contract and that appellant
was entitled to judgment as a matter of law as to appellee's claim predicated on statutory violations.
4 The trial court had earlier determined that, pursuant to Civ.R. 42, appellee's equitable claims would be
tried separately.
No. 15AP-1046 5
estate minus the payment's Father's House had made by
virtue of the land contract.
III. STANDARD OF REVIEW
{¶ 11} A trial court is obligated to provide jury instructions that correctly and
completely state the law. Cromer v. Children's Hosp. Med. Ctr. of Akron, 142 Ohio St.3d
257, 2015-Ohio-229, ¶ 22, citing Sharp v. Norfolk & W. Ry. Co., 72 Ohio St.3d 307, 312
(1995). The jury instructions must also be warranted by the evidence presented in a case.
Id., citing Estate of Hall v. Akron Gen. Med. Ctr., 125 Ohio St.3d 300, 2010-Ohio-1041,
¶ 26. The question of whether a jury instruction is legally correct and factually warranted
is subject to de novo review. Id. An inadequate instruction that misleads the jury
constitutes reversible error. Marshall v. Gibson, 19 Ohio St.3d 10, 12 (1985). Our
standard of review when it is claimed that improper jury instructions were given is to
consider the jury charge as a whole and determine whether the charge misled the jury in a
manner affecting the complaining party's substantial rights. Dublin v. Pewamo Ltd., 194
Ohio App.3d 57, 2011-Ohio-1758, ¶ 28 (10th Dist.), citing Kokitka v. Ford Motor Co., 73
Ohio St.3d 89, 93 (1995).
{¶ 12} A trial court, however, has discretion whether to give a requested jury
instruction based on the dispositive issues presented during trial. Renfro v. Black, 52
Ohio St.3d 27, 31 (1990). An appellate court reviews a trial court's refusal to provide a
requested jury instruction for an abuse of discretion. State v. Norman, 10th Dist. No.
12AP-505, 2013-Ohio-1908, ¶ 36, citing State v. Wolons, 44 Ohio St.3d 64, 68 (1989).
"However, '[t]he trial court need not give a proposed instruction in the precise language
requested by its proponent, even if it properly states an applicable rule of law. The court
retains discretion to use its own language to communicate the same legal principles.' " Id.
at ¶ 46, quoting Youssef v. Parr, Inc., 69 Ohio App.3d 679, 691 (8th Dist.1990).
"Ultimately, we need not disturb a trial court's refusal to give a requested jury instruction
absent an abuse of discretion." Id., citing Wolons at 68.
IV. LEGAL ANALYSIS
{¶ 13} Because appellant's second assignment of error challenges the trial court's
rulings on appellant's motion for directed verdict and motion for judgment
notwithstanding the verdict ("JNOV"), we will consider it last.
No. 15AP-1046 6
A. First Assignment of Error
{¶ 14} In appellant's first assignment of error, appellant argues that the trial court
erred when it failed to instruct the jury that the proper measure of damages for the breach
of a land installment contract is the difference between the contract price and the value of
the real estate at the time of the breach. Appellee contends that appellant waived any trial
court error regarding the court's failure to give the instruction at issue because appellant
failed to object to the trial court's jury instructions.5
{¶ 15} "It is well settled that the 'failure to timely advise a trial court of possible
error, by objection or otherwise, results in a waiver of the issue for purposes of appeal.' "
Westerville v. Taylor, 10th Dist. No. 13AP-806, 2014-Ohio-3470, ¶ 12, quoting Goldfuss
v. Davidson, 79 Ohio St.3d 116, 121 (1997). Civ.R. 51(A) provides:
On appeal, a party may not assign as error the giving or the
failure to give any instruction unless the party objects before
the jury retires to consider its verdict, stating specifically the
matter objected to and the grounds of the objection.
(Emphasis added.)
{¶ 16} In response to appellee's waiver argument, appellant points to the decision
of the Supreme Court of Ohio in Krischbaum v. Dillon, 58 Ohio St.3d 58 (1991), wherein
the court discussed the purpose of the waiver rule under Civ.R. 51(A) as follows:
Where the record affirmatively shows that a trial court has
been fully apprised of the correct law governing a material
issue in dispute, and that the complaining party has
unsuccessfully requested the inclusion of that law in the trial
court's charge to the jury, that party does not waive his
objection to the court's charge by failing to make a formal
objection to the charge as actually given by the trial court.
Presley v. Norwood (1973), 36 Ohio St. 2d 29, 65 O.O. 2d 129,
303 N.E. 2d 81, paragraph one of the syllabus. The purpose of
Civ. R. 51(A) is to provide a trial court with an opportunity to
correct any errors in the instructions as given, and that
purpose is fully served where the appellant has formally
requested an instruction to the contrary, and the issue has
been argued to the trial court.
5 The written jury instructions are not part of the record on appeal. However, in response to appellant's
assignments of error, appellee does not dispute appellant's representations as to the instruction given to the
jury and those that the trial court omitted. The trial transcript does evidence the trial court's oral
instructions to the jury.
No. 15AP-1046 7
Krischbaum did not formally object to the trial court's failure
to give the proposed jury instructions at issue or to the
instructions the trial court gave the jury prior to retiring.
However, the trial court and counsel for the parties engaged in
a lengthy discussion regarding the proposed instructions at
issue, making their positions clear to the trial court.
Therefore, we agree with the court of appeals that Krischbaum
did not waive his objections to the trial court's refusal to give
the proposed instructions when he did not formally object to
the given charge.
Id. at 61.
{¶ 17} Here, as was the case in Krischbaum, appellant failed to formally object to
the omission of a jury instruction regarding market value before the jury retired to
consider its verdict. Nor did appellant provide the trial court with a proposed jury
instruction on the issue. Nevertheless, the trial transcript does reveal that the parties
debated the inclusion of such an instruction:
THE COURT: Mr. Onesto [appellant's counsel], is there
something you want to add to all this?
MR. ONESTO: Well, Your Honor, I have three proposals,
really, after I looked at these instructions more closely. And
one has to do with what I brought up before. When a
purchaser or seller defaults on a contract, the sale of real
estate, the proper measure of damages is the difference
between the contract price and the market value of the
property at the time of the breach.
And the citations I'm going to give you are Roesch against
Bray, 1988, 46 Ohio App. 3d 49, and Roth v. Habansky, 2003-
Ohio-5378. That's number one.
(Tr. at 456-57.)
{¶ 18} Here, the parties debated the inclusion of the market value instruction in
open court during proceedings to determine the proper jury charge. Appellant cited Ohio
case law allegedly supporting the argument that the evidence required a market value
instruction. The transcript reveals that the trial court refused to instruct the jury on the
fair market value "because we didn't have appropriate testimony with regards [to] fair
market value, and so I recognize to a certain extent one of the things I am concerned
No. 15AP-1046 8
about is making sure that the jury is not confused." (Tr. at 444-45.) On this record, we
cannot say that appellant waived the right to challenge the omission of a market value
instruction for purposes of this appeal. Accordingly, we shall address the argument raised
by appellant's first assignment of error.
{¶ 19} As a general rule, "when a purchaser defaults upon a contract for the sale of
real estate, the seller may recover the difference between the contract price and the
market value of the property at the time of the breach." Roesch v. Bray, 46 Ohio App.3d
49, 50 (6th Dist.1988), citing 54 Ohio Jurisprudence 2d, Vendor and Purchaser, Section
181 at 731 (1962); 77 American Jurisprudence 2d, Vendor and Purchaser, Section 491 at
616 (1975); McCarty v. Lingham, 111 Ohio St. 551 (1924), paragraph three of the syllabus.
This court has applied the general rule of damages whenever a buyer defaults on an
installment land contract. Mildred Hine Trust v. Buster, 10th Dist. No. 07AP-277, 2007-
Ohio-6999; MacDonald v. Authentic Invests., LLC, 10th Dist. No. 15AP-801, 2016-Ohio-
4640.
{¶ 20} Appellant claims that the difference between the contract price and the
market value of the property at the time of the breach represents the exclusive measure of
damages when a seller defaults on a real estate purchase contract. However, the only case
cited by appellant applying the market value analysis when the seller defaults on a real
estate purchase agreement is Roth v. Habansky, 8th Dist. No. 82027, 2003-Ohio-5378, a
case involving the sale of a residential home. There is no dispute that the property at issue
in this case is commercial real estate, and there is evidence in the record that appellee
made substantial improvements to the property. The evidence also shows that appellee
sublet the property to the Shelter Board for $5,500 per month. Consequently, the
difference between the contract price and the market value of the property at the time of
the breach does not represent a true measure of appellee's expectation damages under the
facts of this case, let alone the exclusive measure of appellee's damages as a result of
appellant's material breach of the contract.
{¶ 21} This court discussed the purpose of contract damages in Alternatives
Unlimited-Special, Inc. v. Ohio Dept. of Edn., 10th Dist. No. 12AP-647, 2013-Ohio-3890:
The purpose of contract damages is to compensate the non-
breaching party for the losses suffered as a result of a breach.
No. 15AP-1046 9
Thus, money damages awarded for breach of contract are
designed to place the non-breaching party in the same
position it would have been in had the contract not been
violated. That position can be defined two different ways.
First, a non-breaching party may recover a damage award that
places it in the position it would have been had the contract
been fully performed. Second, a non-breaching party may
recover a damage award that places it in the position it was in
before the contract was made. Placing the non-breaching
party in the first position protects that party's expectation
interest, i.e., its interest in having the benefit of the bargain.
Placing the non-breaching party in the second position
protects that party's reliance interest, i.e., its interest in being
reimbursed for loss caused by reliance on the contract.
Expectation damages and reliance damages are
fundamentally different: "[t]he expectancy recovery affirms
the existence of a contract; the reliance recovery tries to deny
it." Hunter, Modern Law of Contracts, Section 14:4 (2013).
(Citations omitted.) Id. at ¶ 29.
{¶ 22} Remedies for a breach of contract also include restitution, which is the non-
breaching party's interest in recovering the benefit conferred on the other party.
Restatement 2d of Contracts, § 344(c). "It is well-established that 'where there has been a
material breach of contract by one party, the other party may treat the contract as
terminated and rescind it or may sue for damages.' " Zito v. Tamborski, 11th Dist. No.
2003-L-178, 2005-Ohio-1799, ¶ 23, quoting McDonagh v. Cortland Sav. & Banking Co.,
11th Dist. No. 2002-T-0138, 2004-Ohio-1146, ¶ 38. Consequently, even if the difference
between the contract price and the market value of the property at the time of the breach
was an appropriate method for determining appellee's expectation damages in this case, it
was not the exclusive measure of such damages, nor was it the exclusive remedy available
to appellee. See Habansky (specific performance is an available remedy for the purchaser
where the seller defaults on a real estate purchase agreement).
{¶ 23} The trial court instructed the jury as to expectation damages as follows:
[I]f you find by the greater weight of the evidence that either
party breached the contract, then the party is entitled – that
party is entitled to damages in the amount sufficient to place
him, her, or it in the same position in which he, she, or it
would have been if the contract had been fully performed by
No. 15AP-1046 10
the breaching party to the extent that the damages are
reasonably certain and reasonably foreseeable.
[Y]ou can only award damages where the existence and the
amount of which are reasonably certain and have been proven
to you by the greater weight of the evidence. You may not
award damages that are remote or damages that are
speculative.
(Tt. at 527-28.)
{¶ 24} We find that the instruction given by the trial court properly states the law
as it relates to expectation damages for breach of contract. See Alternatives Unlimited-
Special. We disagree with appellant's contention that damages measured by the
difference between the contract price and the market value of the property at the time of
the breach was the exclusive remedy available to appellee. Moreover, on this record, we
hold that the trial court did not abuse its discretion when it refused to give a market value
instruction. Appellant's first assignment of error is overruled.
B. Third Assignment of Error
{¶ 25} In appellant's third assignment of error, appellant contends that the trial
court erred when it instructed the jury on rescission and restitution even though
appellant, before the case was submitted to the jury, expressly elected to seek expectation
damages based on an alleged material breach of contract by appellant. We disagree.
{¶ 26} " '[I]n order that an election of one remedial right shall be a bar to the
pursuit of another, or other remedial rights, the same must be inconsistent and the
election made with knowledge and intention and purpose to elect, and that there must be
an actual election in fact made; that the mere bringing of a suit is not determinative of
that right, but the party against making the election must have received some benefit
under his election, or have caused detriment or loss to the other party, or pursued his
remedy to final judgment.' " Mike Castrucci Ford Sales, Inc. v. Hoover, 12th Dist. No.
CA2007-02-022, 2008-Ohio-1358, ¶ 17, quoting Frederickson v. Nye, 110 Ohio St. 459,
466 (1924). " '[A]n action in rescission and one in money damages are different and
inconsistent remedies as a matter of law.' " Id. at ¶ 16, quoting Williams v. Banner Buick,
Inc., 60 Ohio App.3d 128, 130 (12th Dist.1989).
No. 15AP-1046 11
{¶ 27} "The party asserting the affirmative defense of election of remedies has the
burden of proving that an election has occurred." Id. at ¶ 17. "Whether [a party has]
elected the remedy of rescission is a question of fact." Id. at ¶ 19.
{¶ 28} In appellant's April 27, 2015 motion in limine, appellant sought an order
preventing appellee from offering evidence of its expectation damages because appellee
expressly elected to rescind the contract in its August 20, 2013 letter to appellant. In the
trial court's July 7, 2015 decision denying appellant's motion, the trial court concluded
that the question whether appellant had elected the remedy of rescission and restitution
was a question of fact for the jury. The trial court subsequently instructed the jury as
follows:
If you find by the greater weight of the evidence that the
plaintiff elected to rescind the contract or cancel the contract,
and if you find that either, A, the plaintiff received some
benefit under its election of that remedy or, B, caused the
defendant a detriment, or a loss, then the plaintiff is entitled
to recovery of the reasonable value of the work, services, and
materials furnished by the plaintiff to the defendant. The
reasonable value is not limited by the contract price and may
be greater or less than the contract price, but that reasonable
value is limited to the extent that the plaintiff has conferred a
benefit upon the defendant by way of part performance or
reliance.
If you find by the greater weight of the evidence that the
plaintiff is entitled to damages and that the plaintiff did not
elect to rescind or cancel the contract as set forth above, then
the plaintiff should be entitled to its expectation damages.
(Emphasis added.) (Tr. at 527.)6
{¶ 29} Our de novo review of the trial court's instruction reveals that the trial court
properly instructed the jury on the law as it relates to rescission and restitution. Hoover;
Fredrickson. We also find that the trial court did so in a manner that was designed to
avoid double recovery. Because there is evidence in the record to support a finding that
appellant elected to rescind the contract, the trial court did not abuse its discretion by
6 The trial court went on to instruct the jury on expectation damages as set out in connection with appellant's
first assignment of error.
No. 15AP-1046 12
giving the instruction at issue. Accordingly, appellant's third assignment of error is
overruled.
C. Fourth Assignment of Error
{¶ 30} In appellant's fourth assignment of error, appellant argues that the trial
court erred by instructing the jury regarding rescission and restitution without also
instructing the jury that appellee was entitled to a reduction in the amount of restitution
based on the reasonable rental value of the property during appellee's occupancy.
Appellee contends that appellant waived this challenge for purposes of appeal by failing to
formally object to the jury instructions before the jury retired to consider its verdict. We
agree.
{¶ 31} On June 14, 2015, appellant submitted a request for jury instructions.
Appellant did not request the instruction at issue in this assignment of error. The trial
transcript also reveals the following discussion regarding the instruction on rescission and
restitution:
THE COURT: Okay. Then the last paragraph or the second
paragraph under election of remedies/restitution before we to
get expectation damages said, hey, if they didn't rescind it,
then you go into expectation damages, so that's covered.
MR. GERLING: That's covered, but we still have the problem
of right in the beginning it says rescind and if the instruction
is to say and it's going to use the word rescind, I would just
like some additional language.
THE COURT: Write it out and I'll consider it.
MR. GERLING: Okay. That's fine.
MR. ONESTO: Would you like some additional language like
in the cases here, a party rescinding, it causes the contract
from the very beginning to be null and void? Would you like
that language in there?
MR. GERLING: Sure. Then they get $80,000 worth of
payments.
MR. ONESTO: No. It doesn't say that. No. It means you
have no rights under the contract because there was never a
contract to begin with.
No. 15AP-1046 13
THE COURT: Well, rather than debate that right now, you
write your proposed language out. If you have something that
you wish to add in that regard, you write that out as well, and,
as I say, I will consider that. Okay?
MR. ONESTO: Okay.
THE COURT: All right. Any other objections with regards to
the instructions?
MR. GERLING: Nothing from Father's House, Your Honor.
THE COURT: How about from you?
MR. ONESTO: None, Your Honor.
(Tr. at 449-50.)
{¶ 32} There is nothing in the record showing that appellant followed up on the
trial court's invitation to supplement the instructions regarding rescission and restitution.
Appellant did not object to the trial court's failure to give an instruction regarding the
reasonable rental value before the jury retired to consider its verdict. Moreover, appellant
did not expressly raise reasonable rental value as a basis for appellant's motions for
directed verdict or for JNOV.
{¶ 33} The record does not affirmatively show that appellant apprised the trial
court of the correct law regarding the issue of reasonable rental value or that appellant
unsuccessfully requested the inclusion of a reasonable rental value instruction in the trial
court's charge to the jury. Thus, the circumstances surrounding the trial court's omission
of a reasonable rental value instruction are materially different than the circumstances
surrounding the omission of the market value instruction discussed in appellant's first
assignment of error. For the same reasons, the circumstances are distinguishable from
those addressed by the Supreme Court of Ohio in the Krischbaum case.
{¶ 34} Based on the foregoing, the only conclusion to be drawn from the record is
that appellant waived the argument raised in his fourth assignment of error by failing to
object to the omission of a reasonable rental value instruction before the jury retired to
consider its verdict. Accordingly, appellant's fourth assignment of error is overruled.
No. 15AP-1046 14
D. Second Assignment of Error
{¶ 35} In appellant's second assignment of error, appellant argues that the trial
court erred when it denied appellant's motion for directed verdict and for JNOV.
1. Directed Verdict
{¶ 36} In Reeves v. Healy, 192 Ohio App.3d 769, 2011-Ohio-1487, ¶ 64 (10th Dist.),
this court set forth the applicable standard of review of a trial court decision denying a
motion for directed verdict as follows:
When considering a motion for a direct verdict, a court must
construe the evidence most strongly in favor of the party
against whom the motion is directed. Civ.R. 50(A). A motion
for a directed verdict raises questions of law, not factual
issues, because it tests whether the evidence is legally
sufficient to allow the case to be presented to the jury for
deliberation. The court's disposition of the motion thus does
not involve weighing the evidence or the credibility of the
witnesses. The court must deny the motion where any
evidence of substantial probative value favors the nonmoving
party and reasonable minds might reach different conclusions
on that evidence. Because a directed verdict tests only the
sufficiency of the evidence, it presents a question of law that
appellate courts review de novo.
(Internal citations omitted.) Id. at ¶ 37.
{¶ 37} Appellant first contends that the trial court erred when it denied his motion
for directed verdict because appellee failed to present evidence of the market value of the
real estate at the time of the breach. As discussed in connection with appellant's first
assignment of error, monetary damages measured by the difference between the contract
price and the market value of the property at the time of the breach is not the only
measure of appellee's expectation damages in this case, and it is not the only remedy
available to appellee. Alternatives Unlimited-Special. Furthermore, as discussed in
connection with appellant's third assignment of error, the trial court properly instructed
the jury on the available remedy of rescission and restitution. Accordingly, to the extent
that appellant grounded the motion for directed verdict on the lack of evidence as to the
market value of the property at the time of the breach, the trial court did not err by
denying the motion.
No. 15AP-1046 15
{¶ 38} Appellant argued alternatively that appellee did not produce sufficient
evidence to establish either the existence or the amount of expectation damages to a
reasonable degree of certainty. We disagree.
{¶ 39} As a general rule, " 'a party seeking damages for breach of contract must
present sufficient evidence to show entitlement to damages in an amount which can be
ascertained with reasonable certainty.' " J&H Reinforcing & Structural Erectors, Inc. v.
Ohio School Facilities Comm., 10th Dist. No. 12AP-588, 2013-Ohio-3827, ¶ 94, quoting
Tri-State Asphalt Corp. v. Ohio Dept. of Transp., 10th Dist. No. 94API07-986 (Apr. 11,
1995). " 'Contract damages must be shown with certainty and not be left to speculation.' "
Id., quoting Sampson Sales, Inc. v. Honeywell, Inc., 8th Dist. No. 51139 (Dec. 18, 1986).
{¶ 40} Appellee produced evidence that it would have been able to make the
remaining monthly installment payments under the contract, including the upcoming
balloon payment. Appellee's pastor, Bobby Mitchell, testified that appellee would have
been able to make the upcoming balloon payment had appellant not committed a material
breach of the contract by demanding increased monthly installment payments. The
balloon payment would have come due on or about November 2013. Appellant also
produced evidence that it made improvements to the property costing more than
$128,000. The evidence establishes that appellee obtained much of the funding for the
improvements by way of a grant from the Shelter Board. There is no evidence that
appellee was obligated to reimburse the grantor, and the city is not a party to this action.
Pastor Mitchell further related that under the terms of the contract, as orally modified,
once appellee made full payment on the contract appellee would take ownership of the
property including the costly improvements. Such evidence, if believed, supports an
award of expectation damages to appellee, even excluding the potential lost profits from
the sublease to the Shelter Board and/or any future lessee.
2. Judgment Notwithstanding the Verdict
{¶ 41} A motion for JNOV is used to determine whether the evidence is totally
insufficient to support the verdict. Gilson v. Am. Inst. of Alternative Medicine, 10th Dist.
No. 15AP-548, 2016-Ohio-1324, ¶ 94, citing Harper v. Lefkowitz, 10th Dist. No. 09AP-
1090, 2010-Ohio-6527, ¶ 8. The test applied by a trial court in ruling on a motion for
JNOV is the same test to be applied on a motion for a directed verdict. Id., citing Posin v.
No. 15AP-1046 16
A.B.C. Motor Court Hotel, Inc., 45 Ohio St.2d 271, 275 (1976). Appellate review of a
ruling on a motion for JNOV is de novo. Id., citing Kanjuka v. MetroHealth Med. Ctr.,
151 Ohio App.3d 183, 2002-Ohio-6803, ¶ 14 (8th Dist.).
{¶ 42} The trial transcript reveals the following proceedings on appellant's oral
motion for JNOV:
MR. ONESTO: I have a motion.
THE COURT: Okay. Would you like to put that in writing?
MR. ONESTO: I would just like to put it on the record. Save
time.
THE COURT: Go right ahead, sir.
MR. ONESTO: Notwithstanding the verdict, I would move for
verdict in favor of the defendant.
THE COURT: Okay. At this point I would overrule that.
MR. ONESTO: Okay.
THE COURT: Okay? I mean, unless there's something
specific that you have in mind that you want me to hear.
MR. ONESTO: No, just it's against the weight of the evidence.
Let's put that on the record.
THE COURT: Okay. Understood. That will be overruled.
(Tr. at 547-48.)
{¶ 43} Having rejected appellant's argument that the trial court erred when it
denied appellant's motion for directed verdict and applying the same standard in
reviewing the trial court's decision denying appellant's motion for JNOV, we must
determine whether the evidence, when viewed in appellee's favor, supports a jury verdict
in favor of appellee for $62,000. Civ.R. 50(B). As stated above, appellee's evidence, if
believed, supports an award of expectation damages of $62,000, even if the potential lost
No. 15AP-1046 17
profits from the sublease to the Shelter Board and/or any future lessee is excluded and
even if appellee's liability for taxes and utilities is considered.7
{¶ 44} Moreover, the jury verdict forms and jury interrogatories did not ask the
jury to identify the basis of its damage award, just the amount. Because the jury was not
asked to specify whether it found that appellee had elected the remedy of rescission, the
record contains no indication whether the $62,000 verdict represents restitution
damages or expectation damages. Consequently, even if we were to conclude that the
weight of the evidence did not support expectation damages of $62,000, we would be
required to affirm the judgment of the trial court if the evidence in the record, when
viewed in appellee's favor, supports a finding by the jury that appellee elected to rescind
the contract.
{¶ 45} There is no dispute that appellee paid appellant $80,000 under the contract
during its occupancy of the premises and made improvements to the property costing
$128,000, a portion of which were paid for by appellee. Because the evidence, when
construed most strongly in appellee's favor, shows that appellant has retained the
payments made by appellee as well as the improvements to the real property at issue, the
evidence supports an award of restitution damages in the amount found by the jury.
{¶ 46} For the foregoing reasons, appellant's second assignment of error is
overruled.
V. CONCLUSION
{¶ 47} Having overruled appellant's four assignments of error, we affirm the
judgment of the Franklin County Court of Common Pleas.
Judgment affirmed.
DORRIAN, P.J., and BRUNNER, J., concur.
___________________
7The trial court's decision on summary judgment found appellee liable to appellant, as a matter of law, for a
water bill of $2,737.34 and taxes of $2,127.27.