Whittle v. Davis

[Cite as Whittle v. Davis, 2013-Ohio-1950.]
IN THE COURT OF APPEALS
TWELFTH APPELLATE DISTRICT OF OHIO
BUTLER COUNTY
ANTONIO WHITTLE, JR., :
CASE NO. CA2012-08-169
Plaintiff-Appellee, :
OPINION
: 5/13/2013
- vs -
:
DANIELLE DAVIS, et al., :
Defendants-Appellants. :
CIVIL APPEAL FROM BUTLER COUNTY COURT OF COMMON PLEAS
Case No. CV2011-11-3900
Ronald L. Burdge, 2299 Miamisburg-Centerville Road, Centerville, Ohio 45459, for plaintiff-
appellee
Richard L. Hurchanik, 110 North Third Street, Hamilton, Ohio 45011, for defendants-
appellants
S. POWELL, J.
{¶ 1} Defendants-appellants, Danielle Davis, Mohammed T. Al Barbarawi, Falcon
Automobile Sales, Inc., and Falcon Auto Sales, Inc. (collectively, "Falcon Auto Sales"),
appeal a decision of the Butler County Common Pleas Court awarding damages in the
amount of $20,999.60 to plaintiff-appellee, Antonio Whittle, Jr., upon a finding of default
judgment.
Butler CA2012-08-169
{¶ 2} On November 3, 2011, Whittle filed a complaint against Falcon Auto Sales
alleging several violations of the Ohio Consumer Sales Practices Act, R.C. 1345.01, et seq.
("CSPA"), and violations of the Ohio Motor Vehicle Sales Rule, Ohio Admin.Code 109:4-3-16,
et seq., regarding the sale of a 2003 BMW 325 motor vehicle (the "BMW") from Falcon Auto
Sales.
{¶ 3} According to the complaint, in July 2011, Whittle entered into a consumer
transaction and financing agreement with Falcon Auto Sales for the purchase of the BMW.
Falcon Auto Sales represented to Whittle that financing for the transaction had been
approved and that he could pay off the balance owed on the BMW over a period of time.
However, according to the complaint, Whittle later learned that financing had never been
approved for the transaction.
{¶ 4} Also as part of the transaction, Falcon Auto Sales agreed to accept Whittle's
2005 Lexus IS300 motor vehicle (the "Lexus") as a trade-in, giving Whittle a trade-in
allowance of $2,000 towards the purchase of the BMW. Falcon Auto Sales also agreed to
pay off the balance owed on the loan for the Lexus totaling $8,000. Importantly, Whittle
never attached a copy of the sales contract or financing agreement to the complaint, stating
that Falcon Auto Sales "ha[d] a copy" or "ha[d] access to a copy" and that one could be
"provided upon request."
{¶ 5} The complaint further stated that Barbarawi represented to Whittle that the
BMW was in good mechanical condition and free from malfunctions and defects when, in
reality, the BMW was defective and unfit to drive. Specifically, the complaint alleged the
BMW had brakes that were "not effective in stopping the vehicle," one of the BMW's windows
"fell off track," and noises "emanated from under the vehicle."
{¶ 6} On August 4, 2011, Whittle returned the BMW to Falcon Auto Sales due to its
defective condition and the lack of financing. Falcon Auto Sales accepted the return of the
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vehicle but refused to give Whittle back his $2,000 trade-in value or return the Lexus,
claiming the Lexus had already been sold. According to the complaint, however, Whittle
discovered the Lexus was not sold until October 2011 for a purchase price of $12,872, which
was $2,872 more than what Falcon Auto Sales had paid Whittle for the Lexus.
{¶ 7} Whittle's complaint further stated that he was forced to go without a vehicle for
almost five months and had to borrow his mother's vehicle when it was available. This
caused him "significant stress and frustration" due to worrying about how he was going to get
to work and other places. As such, Whittle sought "not more than $25,000 [in] actual
damages or $200 [in] statutory damages or three times actual damages, whichever is
greater" for one violation of the CSPA and an additional damage award of "not more than
$25,000 [in] actual damages or $200 [in] statutory damages or three times actual damages,
whichever is greater" for "violation of the Motor Vehicle Sales Rule and the [CSPA]."
{¶ 8} Falcon Auto Sales failed to timely respond to the complaint and default
judgment on the issue of liability was entered against them on August 2, 2012. Also on
August 2, 2012, and based upon the affidavits of Whittle and his attorney attached to
Whittle's motion for default judgment (the "affidavits"), the trial court awarded Whittle the
amount of $20,999.60 plus court costs and interest due to Falcon Auto Sales' unfair and
deceptive breach of contract in violation of the CSPA. The damages award was broken
down as follows: (1) $2,000 as a result of Falcon Auto Sales' breach of contract, trebled
pursuant to R.C. 1345.09(B) for a total of $6,000; (2) $2,872, the difference between
Whittle's trade-in allowance and the market value of the Lexus, due to Falcon Auto Sales'
violation R.C. 1345.03(B)(6); (3) $5,000 in noneconomic damages for Whittle's stress and
frustration pursuant to R.C. 1345.09(B); (4) five awards of $200 each for various "additional"
CSPA violations totaling $1,000; and (5) $6,127.60 in attorney's fees and court costs.
{¶ 9} From the trial court's final judgment entry, Falcon Auto Sales appeals, raising
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four assignments of error.
{¶ 10} Assignment of Error No. 1:
{¶ 11} THE [TRIAL] COURT ABUSED ITS DISCRETION WHEN IT PROCEEDED TO
ISSUE A JUDGMENT WITHOUT A DAMAGE HEARING BASED UPON A BREACH OF
CONTRACT AND [WHITTLE] ALLEGED A WRITTEN CONTRACT EXISTED AND
[WHITTLE]'S REASON FOR THE NOT (sic) ATTACHING THE CONTRACT TO THE
COMPLAINT WAS "[FALCON AUTO SALES] HAD A COPY" SO THAT THE [TRIAL]
COURT DID NOT EVER HAVE A COPY OF THE CONTRACT TO REVIEW.
{¶ 12} In its first assignment of error, Falcon Auto Sales argues the trial court erred by
awarding damages to Whittle where the trial court was unable to review the contract at issue
and failed to hold a damages hearing pursuant to Civ.R. 55(A).
{¶ 13} "It is well established that even though a party defaults and admits the
allegations of the complaint or stipulates to liability, a plaintiff must still prove his or her
damages." Henry v. Richardson, 193 Ohio App. 3d 375, 2011-Ohio-2098, ¶ 8 (12th Dist.),
citing McIntosh v. Willis, 12th Dist. No. CA2004-03-076, 2005-Ohio-1925. Civ.R. 55(A)
provides, in pertinent part:
If, in order to enable the court to enter judgment or to carry it into
effect, it is necessary to take an account or to determine the
amount of damages or to establish the truth of any averment by
evidence or to make an investigation of any other matter, the
court may conduct such hearings or order such references as it
deems necessary and proper * * *.
Thus, Civ.R. 55(A) "'clearly indicates that a court may conduct a hearing when it deems that
it is necessary. A hearing is permissive, not mandatory.'" (Emphasis sic.) Am.
Communications of Ohio, Inc. v. Hussein, 10th Dist. No. 11AP-352, 2011-Ohio-6766, ¶ 15,
quoting Nationwide Mut. Fire Ins. Co. v. Barrett, 7th Dist. No. 08 MA 130, 2008-Ohio-6588, ¶
26. Due to the discretionary nature of the trial court's authority to hold a hearing on
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damages, we review the trial court's decision under the abuse of discretion standard of
review. Id. An abuse of discretion is more than an error of judgment; it means the trial court
was unreasonable, arbitrary, or unconscionable in its ruling. Blakemore v. Blakemore, 5 Ohio
St.3d 217, 219 (1983).
{¶ 14} "'[W]hen the complaint and the motion for default judgment clearly set forth the
amount of [liquidated] damages,' and reveal the amount to be ascertainable, 'the trial court
does not abuse its discretion in relying on the amount asserted' in the complaint." Hussein at
¶ 16, quoting Barrett at ¶ 26. "If, by contrast, 'the determination of damages necessarily
requires consideration of information outside a written instrument, the trial court abuses its
discretion in failing to hold an evidentiary hearing to determine the exact amount of
damages.'" Id., quoting L.S. Industries v. Coe, 9th Dist. No. Civ.A 22603, 2005-Ohio-6736, ¶
20, appeal not allowed, 109 Ohio St. 3d 1457, 2006-Ohio-2226.
{¶ 15} "Liquidated damages" are defined as "[a]n amount contractually stipulated as a
reasonable estimation of actual damages to be recovered by one party if the other party
breaches." Coe at ¶ 22, citing Black's Law Dictionary (7 Ed.1999) 395. "'A liquidated claim is
one that can be determined with exactness from the agreement between the parties or by
arithmetical process or by the application of definite rules of law.'" Id., quoting Huo Chin Yin
v. Amino Prods. Co., 141 Ohio St. 21, 29 (1943).
{¶ 16} Here, the trial court did not hold a damages hearing, even though the written
instrument upon which the damages award was based was not attached to the complaint in
compliance with Civ.R. 10(D). Civ.R. 10(D) provides that "[w]hen any claim or defense is
founded on an account or other written instrument, a copy of the account or written
instrument must be attached to the pleading. If the account or written instrument is not
attached, the reason for the omission must be stated in the pleading."
{¶ 17} Whittle claims in the complaint that the reason he did not attach the contract
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was because Falcon Auto Sales "has a copy" or has "access to a copy" of the contract and
that Whittle would "provide a copy" of the contract upon request. However, this reason for
omission does not satisfy the requirements of Civ.R. 10(D) and fails to provide the trial court
with a copy of the contract. Point Rental Co. v. Posani, 52 Ohio App. 2d 183, 185 (10th
Dist.1976) (holding that a plaintiff's "statement of belief that the defendant has a copy" of the
written instrument is "an insufficient reason" for the failure to attach the written instrument to
the complaint). It should be noted that the failure of Whittle to properly attach a copy of the
contract to the complaint pursuant to Civ.R. 10(D) does not bar a grant of default judgment
as to liability, as the remedy for a Civ.R. 10(D) violation is to file a motion for more definite
statement pursuant to Civ.R. 12(E). See Denlinger, Rosenthal & Greenberg, LPA v. Cohen,
12th Dist. No. CA2012-03-019, 2012-Ohio-4774, ¶ 14, fn. 2; Hudson & Keyse, LLC v.
Carson, 10th Dist. No. 07AP-936, 2008-Ohio-2570, ¶ 10; Campbell v. Aepli, 5th Dist. Nos.
CT06-0069, CT06-0063, 2007-Ohio-3688, ¶ 43.
{¶ 18} Nevertheless, in addressing the issue of damages upon a finding of default
judgment, the trial court was without the written instrument necessarily required to determine
the amount of liquidated and non-liquidated damages owed to Whittle. Instead, the trial court
relied solely upon the complaint and the affidavits of Whittle and his trial counsel. The
complaint and affidavits allege that Whittle suffered actual damages in the amount of $2,000
for Falcon Auto Sales' breach of contract and failure to return the Lexus or reimburse Whittle
his trade-in value, as well as $2,872 for Falcon Auto Sales' misrepresentation that the Lexus
had already been sold when it had not been sold. The complaint and affidavits also allege
that Falcon Auto Sales' breach of contract was an unfair and deceptive act in violation of the
CSPA. The affidavit of Whittle's trial counsel provides that Whittle spent $522.10 on court
costs and $5,605.50 on attorneys' fees. Whittle's own affidavit asserts that he suffered "a
significant amount of frustration and stress" for five months when he was without a vehicle
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and was required to rely upon his mother for rides to work and other places. Yet, Whittle's
affidavit is uninformative as to the distance between Whittle's home and his mother's, how
often he was forced to use his mother's vehicle, and how often he was without a vehicle
altogether. Finally, the complaint concludes that Whittle seeks "no more than $25,000 [in]
actual damages or $200 [in] statutory damages or three times actual damages, whichever is
greater" for two CSPA violations and for a violation of the Ohio Motor Vehicle Sales Rule.
{¶ 19} Without being able to review the written instrument upon which Whittle's claims
are based, the trial court abused its discretion in awarding damages without holding a
hearing pursuant to Civ.R. 55(A). See Hussein, 2011-Ohio-6766 at ¶ 17 (finding the trial
court abused its discretion in granting default judgment without a damages hearing where the
plaintiff attached an incomplete copy of the contract to the complaint); Coe at ¶ 23 (holding
the trial court abused its discretion in not holding a damages hearing where the plain
language of the complaint and the absence of any note, account, or other contract appended
to the complaint failed to provide that the damages at issue were not liquidated). Without the
contract, it is unclear what economic damages are liquidated and what are not. However, at
the very least, it is clear that Whittle's claim for noneconomic damages due to frustration and
stress are non-liquidated damages, as they cannot be ascertained through the contract or
through a definite rule of law. We note that R.C. 1345.09(B) only provides that "an amount
not exceeding" $5,000 may be awarded for noneconomic damages, not that $5,000 must be
awarded.
{¶ 20} Where, as here, the damages claim is based upon damages which are not
liquidated, or only partially liquidated, it is reversible error for the trial court to enter a default
judgment without holding a hearing on the damages issue. Hull v. Clem D's Auto Sales, 2d
Dist. No. 2011 CA 6, 2012-Ohio-629, ¶ 7, citing Mid-American Acceptance Co. v. Reedy,
11th Dist. Lake No. 89-L-14-072, 1990 WL 94816, *2 (June 29, 1990); see also, e.g.,
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Qualchoice, Inc. v. Brennan, 11th Dist. Lake No.2008-L-143, 2009-Ohio-2533, ¶ 21; W2
Properties, LLC v. Haboush, 1st Dist. No. C-100698, 2011-Ohio-4231, ¶ 29. In this case,
given the nature of the damages sought, coupled with the absence of the written contract, the
trial court should have held a hearing to determine an appropriate damages award. Thus,
Falcon Auto Sales' first assignment of error is well-taken and sustained.
{¶ 21} Assignment of Error No. 2:
{¶ 22} THE [TRIAL] COURT ERRED IN AWARDING DAMAGES AS A DEFAULT
JUDGMENT WITHOUT HAVING A DAMAGE HEARING AND WITHOUT HAVING A COPY
OF THE WRITTEN CONTRACT AND THE ENTRY INCLUDES AMOUNTS AND CLAIMS
NOT IN THE COMPLAINT NOR AFFIDAVIT AND THE ATTORNEY AFFIDAVIT WAS
NOTARIZED BY AN ATTORNEY WHO SEEKS ATTORNEY FEES.
{¶ 23} Assignment of Error No. 3:
{¶ 24} THE [TRIAL] COURT ERRED WHEN IT FOUND A BREACH OF CONTRACT
SO SERIOUS THAT IT WAS UNFAIR AND DECEPTIVE, TO VIOLATE EARNEST V.
CROWN CHEVROLET, INC., WITHIN (sic) ANY EVIDENCE OF THE OFFENDING
BREACH.
{¶ 25} Assignment of Error No. 4:
{¶ 26} THE [TRIAL] COURT ERRED WHEN IT AWARDED A COMPLEX FINAL
ENTRY WITHOUT A DAMAGE HEARING NEEDED TO "MAKE AN INVESTIGATION OF
ANY OTHER MATTER" OR "TO ESTABLISH THE TRUTH OF ANY AVERMENT."
{¶ 27} Having sustained Falcon Auto Sales' first assignment of error, the remaining
assignments of error are rendered moot.
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{¶ 28} Judgment reversed and cause remanded for further proceedings consistent
with this opinion.
HENDRICKSON, P.J. and RINGLAND, J., concur.
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