Smith v. Ohio Edison Co.

[Cite as Smith v. Ohio Edison Co., 2015-Ohio-4540.]
IN THE COURT OF APPEALS
ELEVENTH APPELLATE DISTRICT
TRUMBULL COUNTY, OHIO
C. RICHARD SMITH, : OPINION
Plaintiff-Appellant, :
CASE NO. 2014-T-0093
- vs - :
OHIO EDISON COMPANY, :
Defendant-Appellee. :
Civil Appeal from the Trumbull County Court of Common Pleas, Case No. 2012 CV
1528.
Judgment: Affirmed.
Michael D. Rossi, Guarnieri & Secrest, P.L.L., 151 East Market Street, P.O. Box 4270,
Warren, OH 44482 (For Plaintiff-Appellant).
John T. Dellick, Harrington, Hoppe & Mitchell, LTD., 1200 Sky Bank Building, 26
Market Street, Suite 1200, P.O. Box 6077, Youngstown, OH 44501 (For Defendant-
Appellee).
DIANE V. GRENDELL, J.
{¶1} Plaintiff-appellant, C. Richard Smith, appeals the May 8, 2014 Judgment
Entry of the Trumbull County Court of Common Pleas, granting defendant-appellee,
Ohio Edison Company’s, Motion to Dismiss with respect to his claim for Spoliation of
Evidence on the grounds of res judicata. The issue before this court is whether a
conclusive determination that a certain claim was waived in an administrative
proceeding bars that claim from being raised in a separate action filed in common pleas
court. For the following reasons, we affirm the decision of the court below.
{¶2} On July 3, 2012, Smith filed a Complaint against Ohio Edison in the
Trumbull County Court of Common Pleas, setting forth claims for Inadequate Service
(Count I), Spoliation of Evidence (Count II), and Termination of Service without Proper
Notice (Count III).
{¶3} On October 29, 2013, Ohio Edison filed a Motion to Dismiss on the
following grounds: “[P]ursuant to Civ.R. 12(B)(1) and 12(B)(6), Count II and Count III
must be dismissed, as they were resolved at the Public Utilities Commission of Ohio
(‘PUCO’) and Plaintiff’s subsequent appeal to the Ohio Supreme Court. Count I must
also be dismissed due to the lack of recoverable damages.”
{¶4} On May 8, 2014, the trial court granted the Motion to Dismiss with respect
to the claims for Spoliation and Termination of Service on the grounds of res judicata.
The court denied the Motion with respect to the claim for Inadequate Service.
{¶5} On May 14, 2014, Ohio Edison filed an Answer.
{¶6} On October 6, 2014, the parties entered into a Stipulation and Judgment
Entry, whereby they stipulated that Smith’s damages for Inadequate Service were
nominal and agreed that judgment in the amount of $10 should be entered in Smith’s
favor.
{¶7} On October 17, 2014, Smith filed a Notice of Appeal. On appeal, Smith
raises the following assignment of error: “The trial court erred in dismissing Count II
(Spoliation of Evidence) of the Complaint.”
2
{¶8} “The doctrine of res judicata involves both claim preclusion (historically
called estoppel by judgment in Ohio) and issue preclusion (traditionally known as
collateral estoppel).” Grava v. Parkman Twp., 73 Ohio St. 3d 379, 381, 653 N.E.2d 226
(1995). “A valid, final judgment rendered upon the merits bars all subsequent actions
based upon any claim arising out of the transaction or occurrence that was the subject
matter of the previous action.” Grava at syllabus. “[R]es judicata and collateral
estoppel relieve parties of the cost and vexation of multiple lawsuits, conserve judicial
resources, and, by preventing inconsistent decisions, encourage reliance on
adjudication.” Allen v. McCurry, 449 U.S. 90, 94, 101 S. Ct. 411, 66 L. Ed. 2d 308 (1980).
“[R]es judicata, whether claim preclusion or issue preclusion, applies to administrative
proceedings that are ‘of a judicial nature and where the parties have had an ample
opportunity to litigate the issues involved in the proceeding.’” (Internal citation omitted.)
Grava at 381, citing Set Prods., Inc. v. Bainbridge Twp. Bd. of Zoning Appeals, 31 Ohio
St.3d 260, 263, 510 N.E.2d 373 (1987); Office of Consumers’ Counsel v. Pub. Util.
Comm. of Ohio, 16 Ohio St. 3d 9, 10, 475 N.E.2d 782 (1985).
{¶9} The application of the principles of res judicata and collateral estoppel is
not mandatory in every case. Castorr v. Brundage, 674 F.2d 531, 536 (6th Cir.1982).
The Ohio Supreme Court has recognized “that res judicata is not a shield to protect the
blameworthy.” Davis v. Wal-Mart Stores, Inc., 93 Ohio St. 3d 488, 491, 756 N.E.2d 657
(2001).
The doctrine of res judicata is not a mere matter of practice or
procedure inherited from a more technical time, but rather a rule
of fundamental and substantial justice, or public policy and of
3
private peace. The doctrine may be said to adhere in legal
systems as a rule of justice. Hence, the position has been
taken that the doctrine of res judicata is to be applied in
particular situations as fairness and justice require, and that it is
not to be applied so rigidly as to defeat the ends of justice or so
as to work an injustice.
(Internal citations omitted.) Id.
{¶10} The application of res judicata is reviewed de novo on appeal. McGowan
v. McDowell, 11th Dist. Portage No. 2008-P-0112, 2009-Ohio-5891, ¶ 18; Zamos v.
Zamos, 11th Dist. Portage No. 2008-P-0021, 2009-Ohio-1321, ¶ 14.
{¶11} In the present case, Smith’s Spoliation claim arose out of a complaint filed
against Ohio Edison with the Public Utilities Commission (Case No. 10-340-EL-CSS).
Complaint at ¶ 3.
[O]n March 17, 2010, Smith filed a pro se complaint against
Ohio Edison with the commission pursuant to R.C. 4905.26.
Smith subsequently retained counsel and filed an amended
complaint on August 9, 2010. The amended complaint alleged,
among other things, that Smith had established residential
electric service to his Mahoning Avenue property through his
repeated phone calls to Ohio Edison. Smith further alleged that
Ohio Edison had terminated the electric service to this property
without warning or proper notification to him, in violation of the
4
Ohio Administrative Code. Smith claimed injury and requested
that Ohio Edison pay damages.
Smith v. Ohio Edison Co., 137 Ohio St. 3d 7, 2013-Ohio-4070, 996 N.E.2d 927, ¶ 17.
{¶12} “The commission held an evidentiary hearing on February 23, 2011.” Id.
at ¶ 18. “At the February 23, 2011 hearing before the Public Utilities Commission, Ohio
Edison Company played Exhibit G [which] was a CD containing eleven recorded
telephone conversations between C. Richard Smith and Ohio Edison Company
representatives.” Complaint at ¶ 44.
{¶13} “Smith * * * sought rehearing before the commission.” Smith at ¶ 20.
45. After the hearing, C. Richard Smith submitted a digital
copy of Exhibit G, that he obtained from Ohio Edison Company,
to an expert in the analysis of audio recordings, and based upon
the review of only one of the eleven telephone conversations,
the expert found 13 areas of concern.
46. Based upon the expert evaluation of Exhibit G, C.
Richard Smith believes that Ohio Edison Company altered the
evidence that was submitted to the Public Utilities Commission
at the February 23, 2011 hearing.
Complaint at 7.
{¶14} The Commission denied Smith’s application for rehearing on August 31,
2011, and Smith appealed to the Ohio Supreme Court. Smith at ¶ 20; Complaint at ¶ 6.
{¶15} Among the propositions of law presented before the Supreme Court,
Smith “claim[ed] that the commission should have granted his rehearing application
5
because he provided ‘some evidence’ to support his claim that the recordings were
altered.” Smith at ¶ 46. The Supreme Court found no error in the Commission’s
decision to deny rehearing.
First, Smith’s counsel completely ignores that he signed
a stipulation before the hearing that the recordings were
authentic. The stipulation states that “[t]he tape recorded
telephone conversations between C. Richard Smith and Ohio
Edison personnel * * * are authentic recordings of those
conversations made at the time of the telephone conversations
in the ordinary course of business by Respondent Ohio Edison
Company.” Yet on appeal, Smith’s counsel makes no mention
of the stipulation, let alone offers an explanation that would
serve as a reason to invalidate the stipulation at this late date.
Second, the commission did not deny rehearing based
on a lack of evidence. Rather, it found that the alleged error
had been waived. We agree with this conclusion. As noted,
Smith did not raise any complaint regarding the audio
recordings until he filed his application for rehearing, long after
the evidentiary hearing where those recordings were played.
Smith did not object to the fact that he received the compact
discs only six days before the hearing or argue that he had
insufficient time before the hearing to review the recordings. He
also waited until after the hearing to hire an audio expert,
6
instead of seeking to have the hearing continued so he could
retain an expert to review the recordings before the hearing. By
failing to take any of these steps, Smith deprived the
commission of an opportunity to cure any error when it
reasonably could have. Therefore, the commission correctly
found that the issue had been waived. See Parma v. Pub. Util.
Comm., 86 Ohio St. 3d 144, 148, 712 N.E.2d 724 (1999) (“we
do not accept * * * objections” when appellant has “deprived the
commission of an opportunity to redress any injury or prejudice
that may have occurred”); In re Application of Am. Transm. Sys.,
Inc., 125 Ohio St. 3d 333, 2010-Ohio-1841, 928 N.E.2d 427, ¶
31 (same).
Smith at ¶ 47-48.
{¶16} Smith’s argument on appeal in the present case is that the application of
res judicata works an injustice and rewards the offending party (Ohio Edison) for
misrepresenting or destroying evidence. We disagree.
{¶17} The Ohio Supreme Court has held that “claims for spoliation of evidence
may be brought after the primary action has been concluded only when evidence of
spoliation is not discovered until after the conclusion of the primary action.” Davis, 93
Ohio St. 3d at 491, 756 N.E.2d 657; Monroe v. Forum Health, 11th Dist. Trumbull No.
2014-T-0015, 2014-Ohio-3974, ¶ 34 (“since the spoliation was discovered during the
trial, it could not be raised in a separate claim”).
7
{¶18} With respect to Smith’s Spoliation claim, the Ohio Supreme Court
conclusively determined that Smith waived it by not raising it during the course of the
proceedings before the Commission. Thus, under the aspect of res judicata known as
issue preclusion, Smith is collaterally estopped from raising his Spoliation claim in an
independent action. Fort Frye Teachers Assn., OEA/NEA v. State Emp. Relations Bd.,
81 Ohio St. 3d 392, 395, 692 N.E.2d 140 (1998) (“[t]he doctrine of issue preclusion, also
known as collateral estoppel, holds that a fact or a point that was actually and directly at
issue in a previous action, and was passed upon and determined by a court of
competent jurisdiction, may not be drawn into question in a subsequent action between
the same parties or their privies, whether the cause of action in the two actions be
identical or different”).
{¶19} Although not raised by the parties, the trial court erred by granting Ohio
Edison’s Motion to Dismiss based on res judicata inasmuch as the Ohio Supreme Court
holds that res judicata is not a proper basis for a Civil Rule 12 motion. Jefferson v.
Bunting, 140 Ohio St. 3d 62, 2014-Ohio-3074, 14 N.E.3d 1036, ¶ 9-10, citing State ex
rel. Freeman v. Morris, 62 Ohio St. 3d 107, 109, 579 N.E.2d 702 (1991). “It is not proper
for a court to grant a motion to dismiss based on res judicata, because res judicata is an
affirmative defense, [Civ.R. 8(C)] * * * and because resolution of a res judicata defense
typically requires resort to materials outside the pleadings.” State ex rel. West v.
McDonnell, 139 Ohio St. 3d 115, 2014-Ohio-1562, 9 N.E.3d 1025, ¶ 16 (cases cited).
“When the res judicata defense depends on documents outside the pleadings, the
proper procedure is for the court to convert the motion to dismiss into a motion for
8
summary judgment and provide the opposing party with notice and an opportunity to
respond.” Jefferson at ¶ 12.
{¶20} In the present case, we find the error harmless. Civ.R. 61 (“no error or
defect in any ruling or order * * * is ground for * * * vacating, modifying or otherwise
disturbing a judgment or order, unless refusal to take such action appears to the court
inconsistent with substantial justice”).
{¶21} “The primary vice of unexpected conversion to summary judgment is that
it denies the surprised party sufficient opportunity to discover and bring forward factual
matters which may become relevant only in the summary judgment, and not the
dismissal, context.” (Citation omitted.) Petrey v. Simon, 4 Ohio St. 3d 154, 155, 447
N.E.2d 1285 (1983).
{¶22} In support of its Motion to Dismiss, Ohio Edison attached copies of the
Commission’s July 6, 2011 Opinion and Order and August 31, 2011 Entry on
Rehearing. Although these documents are outside of the pleadings, neither document
is necessary to establish the applicability of res judicata to bar Smith’s Spoliation claim.
Smith’s Complaint and the Ohio Supreme Court’s decision in Smith v. Ohio Edison Co.
are sufficient to demonstrate that the claim for Spoliation has been passed upon by a
court of competent jurisdiction and, thus, is barred from being raised herein.
{¶23} Moreover, Smith had ample opportunity to respond or object to the
documents attached to Ohio Edison’s Motion to Dismiss. The Motion to Dismiss was
filed on October 29, 2013. Smith responded on November 13, 2013, with a
Memorandum contra Defendant’s Motion to Dismiss and a Motion for Leave to File an
Amended Complaint. Smith sought to dismiss the Termination of Service without
9
Proper Notice (Count III) claim, acknowledging “the finality of certain companion PUCO
proceedings” with respect to this claim. On May 2, 2014, Smith filed a Supplemental
Memorandum contra Defendant’s Motion to Dismiss. The trial court dismissed the
Spoliation claim on May 8, 2014, over six months after the Motion to Dismiss was filed.
See Dietelbach v. Ohio Edison Co., 11th Dist. Trumbull No. 2004-T-4902, 2005-Ohio-
0063, ¶ 11 (“[w]hile the court did not provide any type of formal notice of the conversion
of the Civ.R 12(B)(6) to one under Civ.R. 56, Dietelbach did have a reasonable
opportunity to present evidence outside her complaint in support of her opposition to
Ohio Edison’s motion”).
{¶24} The sole assignment of error is without merit.
{¶25} For the foregoing reasons, the May 8, 2014 Judgment Entry of the
Trumbull County Court of Common Pleas, dismissing Smith’s claim for Spoliation of
Evidence, is affirmed. Costs to be taxed against appellant.
TIMOTHY P. CANNON, P.J.,
THOMAS R. WRIGHT, J.,
concur.
10