Schutte v. DiCello , 2018 Ohio 5118 ( 2018 )

[Cite as Schutte v. DiCello, 2018-Ohio-5118.]
STATE OF OHIO ) IN THE COURT OF APPEALS
)ss: NINTH JUDICIAL DISTRICT
COUNTY OF SUMMIT )
ROBERT SCHUTTE, et al. C.A. No. 28807
Appellants
v. APPEAL FROM JUDGMENT
ENTERED IN THE
ROBERT DICELLO, et al. COURT OF COMMON PLEAS
COUNTY OF SUMMIT, OHIO
Appellees CASE No. CV-2016-09-3822
DECISION AND JOURNAL ENTRY
Dated: December 19, 2018
CARR, Judge.
{¶1} Plaintiffs-Appellants Robert and Susan Schutte (“the Schuttes”) appeal from the
judgment of the Summit County Court of Common Pleas which granted the motion for summary
judgment of Defendants-Appellees Robert DiCello, Esq., Mark Abramowitz, Esq., Justin Hawal,
Esq., the DiCello Law Firm, and Robert DiCello, LPA (collectively “DiCello”). This Court
affirms.
I.
{¶2} In 2012, the Schuttes sold a subdivided portion of their property on Berna Road in
the City of Green to their daughter. The sale of that land caused the Schuttes’ to seek alternate
access to Berna Road, as their daughter’s land contained a gravel road that the Schuttes’ had
previously used to access Berna Road. Subsequently, the Schuttes began primarily using an
unimproved, City-owned drive, known as Tim Drive to access Berna Road. The Schuttes’ use of
Tim Drive led to conflicts with the neighboring landowners concerning use of the drive.
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Ultimately, Robert Schutte was charged with a third-degree misdemeanor for spreading gravel
on Tim Drive without a permit. That charge allegedly resulted in Robert Schutte losing his
position with the Summit County Sheriff’s Office. The prosecutor later dismissed the charge
against Robert Schutte. In 2014, the City of Green passed an ordinance whereby it vacated the
public land where Tim Drive was situated and burdened the Schuttes’ daughter’s land with an
easement to be used by the neighboring land owners.
{¶3} Thereafter, the Schuttes and their daughter retained the DiCello Law Firm to
represent them. Attorneys from the DiCello Law Firm then filed a complaint (henceforth
referred to as “the land dispute”) on behalf of the Schuttes and their daughter. The complaint
sought to resolve the land dispute between the Schuttes, their daughter, the City of Green, and
the neighboring landowners. Subsequently, attorneys with the DiCello Law Firm filed a second
complaint on behalf of Robert Schutte (“the labor dispute”) which alleged claims of malicious
prosecution, selective prosecution, abuse of process, and wrongful discharge. The allegations
related to the misdemeanor charge filed against Robert Schutte and his termination from the
Summit County Sheriff’s Office.
{¶4} As part of the litigation of the land dispute, an attorney or attorneys from the
DiCello Law Firm represented to the opposing counsel of one of the neighboring landowners that
the Schuttes had agreed to settle their dispute with the landowner and buy that neighboring
landowner’s home for $200,000. The Schuttes denied that they had reached such an agreement.
On July 31, 2015, Robert Schutte sent an email addressed to Robert DiCello. In that email,
Robert Schutte stated that they could not come to terms on the purchase of the home and it was
“a dead issue.” He requested that the law firm pursue an alternate strategy. In an August 3, 2015
email, Robert Schutte wrote Robert DiCello informing him that the Schuttes did not agree to
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purchase the property for $200,000 and did not agree to release the landowner from suit.
Thereafter, in an email dated August 3, 2015, Robert DiCello sent Robert Schutte an email
stating that “[i]n light of recent events and correspondence, The DiCello Law Fim has decided to
end its representation of you, your wife, and your daughter effective immediately.”
Subsequently, formal motions to withdraw were filed in both cases and were later granted.
{¶5} On September 7, 2016, the Schuttes filed a complaint against DiCello containing
two claims: one for legal malpractice and a second for common law fraud. DiCello ultimately
moved for summary judgment on the basis that the complaint was filed outside the applicable
statute of limitations and that the Schuttes lost their cases because they lacked evidence to
support their claims, not because of any malpractice. DiCello argued that the complaint was
governed by the one-year statute of limitations contained in R.C. 2305.11. DiCello asserted that
the attorney-client relationship terminated on August 3, 2015 and that that same date also was a
day of a cognizable event. Additionally, DiCello argued that the one-year statute of limitations
also controlled the claim that the Schuttes had labeled as a fraud claim as it was in essence a
legal malpractice claim.
{¶6} The Schuttes opposed the motion arguing that DiCello had committed malpractice
as shown through the evidentiary materials they submitted. Additionally, in a cursory fashion,
the Schuttes argued that “even if the legal malpractice claims were to fail, the common law fraud
claim could stand alone * * *.” The brief in opposition does not mention the statute of
limitations let alone develop an argument explaining how the claims were filed in a timely
manner. DiCello filed a reply brief arguing that the fraud claim was a malpractice claim and thus
all of the claims were filed outside the statute of limitations. Additionally, DiCello for the first
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time argued that the Schuttes’ fraud claim failed to allege that DiCello made a material
misrepresentation to the Schuttes.
{¶7} The trial court granted DiCello’s motion for summary judgment. The trial court
concluded that the Schuttes’ claim for common law fraud was in actuality a claim for
malpractice. In so concluding, the trial court relied on a Tenth District case which held that,
where the gist of the complaint sounds in legal malpractice, plaintiffs must specifically allege
that defendants committed the acts for their own personal gain. See DiPaulo v. DeVictor, 51
Ohio App.3d 166, 173 (10th Dist.1988). The trial court found that the one-year statute of
limitations applied to the Schuttes’ claims, that the attorney-client relationship terminated on
August 3, 2015, and that the cognizable event occurred on that date as well. Accordingly, the
trial court determined that the Schuttes filed their complaint outside the statute of limitations.
{¶8} The Schuttes have appealed, raising four assignments of error, which will be
addressed out of sequence to facilitate our review.
II.
ASSIGNMENT OF ERROR III
THE TRIAL COURT ERRED AS A MATTER OF LAW WHEN IT
DECLARED THAT COMMON [LAW] FRAUD IS NOT ACTIONABLE
UNLESS THE COMPLAINT ALLEGES THAT THE TORTFEASOR
ACTUALLY RECEIVED A PECUNIARY GAIN.
{¶9} The Schuttes argue in their third assignment of error that the trial court erred in
determining that, in the setting of a legal malpractice case, common law fraud is not actionable
unless the complaint alleges that the defendants actually received a pecuniary gain. Because we
cannot conclude that the trial court determined the foregoing, we overrule the Schuttes’
assignment of error.
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{¶10} This Court reviews an award of summary judgment de novo. Grafton v. Ohio
Edison Co., 77 Ohio St.3d 102, 105 (1996). This Court applies the same standard as the trial
court, viewing the facts in the case in the light most favorable to the non-moving party and
resolving any doubt in favor of the non-moving party. Viock v. Stowe-Woodward Co., 13 Ohio
App.3d 7, 12 (6th Dist.1983).
{¶11} Pursuant to Civ.R. 56(C), summary judgment is proper if:
(1) No genuine issue as to any material fact remains to be litigated; (2) the
moving party is entitled to judgment as a matter of law; and (3) it appears from
the evidence that reasonable minds can come to but one conclusion, and viewing
such evidence most strongly in favor of the party against whom the motion for
summary judgment is made, that conclusion is adverse to that party.
Temple v. Wean United, Inc., 50 Ohio St.2d 317, 327 (1977).
{¶12} The party moving for summary judgment bears the initial burden of informing the
trial court of the basis for the motion and pointing to parts of the record that show the absence of
a genuine issue of material fact. Dresher v. Burt, 75 Ohio St.3d 280, 292-293 (1996).
Specifically, the moving party must support the motion by pointing to some evidence in the
record of the type listed in Civ.R. 56(C). Id. Once a moving party satisfies its burden of
supporting its motion for summary judgment with acceptable evidence pursuant to Civ.R. 56(C),
Civ.R. 56(E) provides that the non-moving party may not rest upon the mere allegations or
denials of the moving party's pleadings. Id. at 293. Rather, the non-moving party has a
reciprocal burden of responding by setting forth specific facts, demonstrating that a “genuine
triable issue” exists to be litigated at trial. State ex rel. Zimmerman v. Tompkins, 75 Ohio St.3d
447, 449 (1996).
{¶13} In its judgment entry, the trial court found that
[i]n the instant case, Plaintiffs allege Defendants knowingly conveyed false
information about an agreement to purchase real estate with the purpose of
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settling a lawsuit filed by Defendants on behalf of Plaintiffs. This alleged
conveyance of information occurred during Defendants’ representation of
Plaintiffs in [the land dispute]. In order for Plaintiffs to overcome the
presumption Defendants acted in good faith during their representation of
Plaintiffs, Plaintiffs are required to specifically allege Defendants engaged in this
conduct for their own personal gain. Here, Plaintiffs failed to make any such
specific allegations in their complaint.
{¶14} In so doing, the trial court relied on language in DiPaulo, 51 Ohio App.3d at 173.
Therein, the Tenth District stated that, “[i]n order to rebut that presumption and sufficiently
allege a cause of action for fraud against attorneys in a situation where the gist of the complaint
involves legal malpractice,* * * plaintiffs must have specifically alleged that defendants
committed the actions for their own personal gain. To hold otherwise would be to undermine the
purpose and focus of the malpractice statute. Moreover, such requirement is in keeping with the
particularity generally necessary to have a well-pleaded complaint in fraud.” Id. at 173. We
note that the Tenth District and the trial court referred to “personal gain” not pecuniary gain. See
DiPaulo, 51 Ohio App.3d at 173. The two are not synonymous. Pecuniary gain is gain
“consisting of or measured in money[,]” while personal gain is gain that is “of, relating to, or
affecting a particular person[.]” Merriam-Webster’s Collegiate Dictionary 912, 924 (11th
Ed.2004).
{¶15} Irrespective of whether we agree with the Tenth District’s holding in DiPaulo, we
do not read either the Tenth District or the trial court as requiring plaintiffs to allege that
defendants received a pecuniary gain. Instead, the trial court concluded that the Schuttes had to
allege that the Defendants “engaged in th[e] conduct for their own personal gain.” Accordingly,
as the Schuttes’ stated assignment of error is limited to arguing that the trial court erred in
determining something we conclude it did not determine, we overrule the Schuttes’ assignment
of error on that basis. See State v. Jackson, 9th Dist. Summit No. 28691, 2018-Ohio-1285, ¶ 14
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(“This Court will not address arguments that fall outside the scope of an appellant’s captioned
assignment of error.”). Moreover, as we conclude below that the trial court did not err in
merging the fraud claim into the malpractice claim, we see no basis to further address this
assignment of error. The Schuttes’ third assignment of error is overruled.
ASSIGNMENT OF ERROR IV
THE TRIAL COURT ERRED AS A MATTER OF LAW WHEN IT FOUND
THAT COMMON LAW FRAUD MERGES WITH THE TORT OF LEGAL
MALPRACTICE.
{¶16} In their fourth assignment of error, the Schuttes argue that the trial court erred in
concluding that the fraud claim merged into their claim for legal malpractice.
{¶17} “The Ohio Supreme Court has defined malpractice as ‘professional misconduct,
i.e., the failure of one rendering services in the practice of a profession to exercise that degree of
skill and learning normally applied by members of that profession in similar circumstances.’”
Sandor v. Marks, 9th Dist. Summit No. 26951, 2014-Ohio-685, ¶ 10, quoting Natl. Union Fire
Ins. Co. v. Wuerth, 122 Ohio St. 3d 594, 2009-Ohio-3601, ¶ 15. This Court has recognized that
“[c]laims arising out of an attorney’s representation, regardless of their phrasing or framing,
constitute legal malpractice claims that are subject to the one-year statute of limitations set forth
in R.C. 2305.11(A).” (Internal quotations and citations omitted.) Sandor at ¶ 10. “When the
gist of a complaint sounds in malpractice, other duplicative claims are subsumed within the legal
malpractice claim. Indeed, malpractice by any other name still constitutes malpractice.”
(Internal quotations and citations omitted.) Id.{¶18} The allegations of the Schuttes’ fraud claim are as follows:
Due to one o[r] more Defendants falsely telling counsel for [a neighboring
landowner in the land dispute] that the Schuttes agreed to “settle” their dispute
with him and agreed to purchase [the landowner’s] house for $200,000, one or
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more Defendants knowingly conveyed false information, and this fraud caused
financial damage to the Schuttes.
During the October 27, 2015 evidentiary hearing, Schuttes’ new counsel produced
emails between the Schuttes and Defendant DiCello proving that DiCello
conveyed false information to [the landowner’s] attorney concerning the “agreed
settlement” to purchase the house for $200,000.
{¶19} Here, there is no doubt that the allegations raised in the Schuttes’ fraud claim
arose out of DiCello’s representation of the Schuttes. The Schuttes even included similar facts in
their allegations in their self-described legal malpractice claim. Further, even the Schuttes’
expert in his report characterized these facts as malpractice; the Schuttes’ expert noted that it was
“a breach of the standard of care to represent an offer that is not an actual offer from a client.”
Given the foregoing, and this Court’s precedent, we conclude that the trial court did not err in
concluding that the fraud claim merged into the malpractice claim and was therefore subject to
the one-year statute of limitations. See R.C. 2305.11(A).
{¶20} The Schuttes’ fourth assignment of error is overruled.
ASSIGNMENT OF ERROR I
THE TRIAL COURT ERRED IN GRANTING SUMMARY JUDGMENT ON
THE LEGAL MALPRACTICE CAUSES OF ACTION WHEN IT FAILED TO
APPLY THE “TERMINATION RULE” PER R.C. 2305.11(A), TO BOTH
CIVIL CASES.
{¶21} The Schuttes argue in their first assignment of error that the trial court erred in
granting summary judgment on the Schuttes’ legal malpractice claim when it failed to apply the
termination rule to both underlying cases. Because the trial court’s entry does not suggest that it
failed to apply the termination rule to both cases, we conclude the Schuttes’ stated assignment of
error is without merit. Instead, it is apparent that the trial court concluded that the attorney-client
relationship terminated in both cases on the same date.
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{¶22} The Supreme Court has held that “[u]nder R.C. 2305.11(A), an action for legal
malpractice accrues and the statute of limitations begins to run when there is a cognizable event
whereby the client discovers or should have discovered that his injury was related to his
attorney’s act or non-act and the client is put on notice of a need to pursue his possible remedies
against the attorney or when the attorney-client relationship for that particular transaction or
undertaking terminates, whichever occurs later.” Zimmie v. Calfee, Halter, & Griswold, 43 Ohio
St.3d 54 (1989), syllabus.
{¶23} In the instant matter the trial court determined that it was clear from the facts that
DiCello “terminated the attorney-client relationship with Plaintiffs on August 3, 2015 and that
Plaintiffs were aware of the termination of that relationship.” August 3, 2015 was the date of the
email sent to the Schuttes which stated in part that the “DiCello Law Firm has decided to end its
representation of you, your wife, and your daughter effective immediately.” That email was
discussed in the trial court’s judgment entry. Additionally, the trial court specifically referenced
in its judgment entry that, during Robert Schutte’s deposition, “he explained he understood
Defendants withdrew from representation in both cases because of his failure to purchase the
[neighboring] property.” (Emphasis added.) Nothing in the trial court’s judgment entry leads
this Court to conclude that the trial court was only determining a termination date for one of the
cases. Thus, the Schuttes’ stated assignment of error is without merit. To the extent the Schuttes
argue that two other termination dates were the appropriate termination dates, such is outside the
scope of their stated assignment of error. See Jackson, 2018-Ohio-1285, at ¶ 14. Additionally,
we note that the Schuttes’ did not argue below that different termination dates applied to their
cases. The Schuttes’ first assignment of error is overruled.
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ASSIGNMENT OF ERROR II
THE TRIAL COURT COMMITTED REVERSIBLE ERROR WHEN IT
FOUND A SINGLE COGNIZABLE EVENT EXISTED FOR TWO SEPARATE
CASES OF LEGAL MALPRACTICE.
{¶24} In their second assignment of error, in a conclusory fashion, the Schuttes argue
that the trial court erred in finding that a single cognizable event existed for both underlying civil
cases.
{¶25} As noted above, a legal malpractice claim accrues “when there is a cognizable
event whereby the client discovers or should have discovered that his injury was related to his
attorney’s act or non-act and the client is put on notice of a need to pursue his possible remedies
against the attorney or when the attorney-client relationship for that particular transaction or
undertaking terminates, whichever occurs later.” Zimmie at 43 Ohio St.3d 54, at syllabus. “In
assessing the date of a cognizable event, courts employ an objective reasonable person standard,
rather than a subjective standard.” Sandor, 2014-Ohio-685, at ¶ 9. “Specifically, it is enough
that some noteworthy event, the cognizable event, has occurred which does or should alert a
reasonable person that improper legal work has taken place.” (Internal quotations and citations
omitted.) Id. “Courts have considered a client’s dissatisfaction with his or her attorney in
determining whether a cognizable event occurred. Moreover, the injured party need not be able
to assess the extent of his damages due to the questionable legal representation; rather, he need
only be on notice that the attorney’s legal representation was improper.” (Internal citations and
quotations omitted.) Id.{¶26} In its motion for summary judgment, DiCello argued that August 3, 2015
represented the date of the cognizable event. In their brief in opposition to the motion for
summary judgment, the Schuttes made no argument to counter DiCello’s claim that the
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cognizable event occurred August 3, 2015; in fact they did not even mention the statute of
limitations. See Sandor at ¶ 25 (“This Court will not review arguments that are raised for the
first time on appeal.”).
{¶27} In its judgment entry, the trial court opined that, upon receiving the August 3,
2015 email, which also terminated the attorney-client relationship, the “Plaintiffs were put on
notice Mr. DiCello acted beyond his authority (as asserted by Mr. and Mrs. Schutte) by
discussing the $200,000 purchase price of the [neighboring] property with the potential seller. In
their complaint, Plaintiffs complain that this act, specifically, caused them harm.” Thus, the
trial court concluded that August 3, 2015 was the date of the cognizable event.
{¶28} On appeal, the Schuttes have not explained how, in light of the evidence and
argument presented to the trial court, the trial court erred in concluding that the cognizable event
occurred on August 3, 2015. See App.R. 16(A)(7). Nor have they pointed to case law that
would suggest that a trial court is required to determine that there were multiple cognizable
events under the facts of this case. See App.R. 16(A)(7). In fact, much of the Schuttes’
argument in this assignment of error does not even address cognizable events. Thus, we can only
conclude that the Schuttes have not met their burden on appeal to demonstrate that the trial court
erred.
{¶29} The Schuttes’ second assignment of error is overruled.
III.
{¶30} The Schuttes’ assignments of error are overruled. The judgment of the Summit
County Court of Common Pleas is affirmed.
Judgment affirmed.
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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 Appellants.
DONNA J. CARR
FOR THE COURT
SCHAFER, P. J.
CALLAHAN, J.
CONCUR.
APPEARANCES:
DONALD GALLICK, Attorney at Law, for Appellants.
ORVILLE L. REED, III, and DAVID W. HILKERT, Attorneys at Law, for Appellees.