BWIP Recreation Owner, L.L.C. v. Applewood Village Condominium Assn., Inc.

2016 Ohio 1430

• Court: Ohio Court of Appeals
• Decided: April 4, 2016
• Docket: CA2015-07-141
• Status: Published

Opinion

[Cite as BWIP Recreation Owner, L.L.C. v. Applewood Village Condominium Assn., Inc., 2016-Ohio-1430.]

IN THE COURT OF APPEALS

TWELFTH APPELLATE DISTRICT OF OHIO

BUTLER COUNTY

BWIP RECREATION OWNER, LLC, : CASE NO. CA2015-07-141 Appellee, : OPINION : 4/4/2016 - vs - :

APPLEWOOD VILLAGE CONDOMINIUM : ASSOCIATION, INC., et al., : Appellants. :

CIVIL APPEAL FROM BUTLER COUNTY COURT OF COMMON PLEAS Case No. CV2014-01-0050

Roetzel & Andress, LPA, John J. Rutter and Zachary D. Prendergast, 250 East Fifth Street, Suite 310, Cincinnati, Ohio 45202, for appellee

Brandabur & Bowling Co., LPA, Kyle M. Rapier, 315 Monument Avenue, Hamilton, Ohio 45011, for appellant, Applewood Village Condominium Association, Inc.

Rex Wolfgang, 246 High Street, Hamilton, Ohio 45011, for appellants, English Meadows Condominium Association, Inc., Quail Meadows Condominium Association, Inc., and Twin Lakes Homeowners' Association

S. POWELL, J.

{¶ 1} Defendants-appellants, Applewood Village Condominium Association, Inc.

("Applewood Village"), English Meadows Condominium Association, Inc. ("English Butler CA2015-07-141

Meadows"), Quail Meadows Condominium Association, Inc. ("Quail Meadows"), and Twin

Lakes Homeowners' Association ("Twin Lakes"), appeal from the decision of the Butler

County Court of Common Pleas granting summary judgment to plaintiff-appellee, BWIP

Recreation Owner, LLC ("BWIP"), in an action for breach of contract. For the reasons

outlined below, we affirm.

Facts and Procedural History

{¶ 2} As the trial court noted, the parties to this action have a long and litigious

history that stems from an agreement initially entered into in 1991 for the use of recreational

facilities now owned by BWIP. This includes previous litigation regarding that same

agreement, thereby rendering the material facts generally not in dispute. Those undisputed

facts are as follows.

The Agreement

{¶ 3} The recreational facilities at issue were developed in 1973 by Wildwood

Management, Inc. ("Wildwood Management"), a wholly owned subsidiary of Towne

Properties, Inc. ("Towne Properties"), on a portion of land located in Fairfield, Butler County,

Ohio. The recreational facilities consist of two buildings available for social events and

meetings, as well as a swimming pool and tennis courts. The property is also home to

numerous condominium units that have been grouped into several separate condominium

associations, including Applewood Village, Quail Meadows, Twin Lakes, and English

Meadows' predecessor, Wellington Green Condominium Unit Owners' Association

("Wellington Green"). During its ownership of the recreational facilities, Wildwood

Management entered into separate "easement agreements" with the respective associations

that granted the individual residents of those associations the right to utilize the recreational

facilities in exchange for a fee. These "easements" were then recorded in the Butler County

Recorder's Office. -2- Butler CA2015-07-141

{¶ 4} Sometime after entering into these agreements, Wildwood Management

conveyed the recreation facilities to another subsidiary of Towne Properties, Wildwood

Recreational Facilities, LLC ("Wildwood Recreational"). Subsequently, on January 1, 1991,

Wildwood Recreational entered into an agreement with Applewood Village, Quail Meadows,

Twin Lakes, and Wellington Green, among others, to modify the prior "easement

agreements" that each had entered into with Wildwood Management. This new agreement

provided for the use of the recreational facilities by the individual residence owners in each

association in exchange for the payment of a $15 monthly fee per residence. The agreement

also provided, in pertinent part, the following:

Section 4.7. Successors and Assigns.

This Agreement and the obligations of the parties concerned shall bind the property of the Grantor and inure to the benefit of the parties and their respective successors and assigns, and shall continue in full force and effect for a term of ten (10) years from the date on which this Agreement is recorded in the Recorders Office's (sic) of Butler County, Ohio. Thereafter this Agreement shall automatically [be] renewed for successive ten (10) year periods unless amended or terminated by the parties or their respective successors and assigns.

{¶ 5} The agreement was then recorded with the Butler County Recorder's Office on

February 4, 1992. The agreement was subsequently extended, by default, for another ten

year period beginning on February 4, 2002 after attempts to modify the terms of the

agreement were unsuccessful.

The Litigation

{¶ 6} On April 12, 2002, Wildwood Recreational notified the various associations that

it intended to sell the recreational facilities to Connor & Murphy, Ltd. ("Connor & Murphy").

Shortly after receiving this notice, all of the associations stopped paying their required

monthly user fees. Connor & Murphy then closed on the property on January 29, 2003, and

on April 7, 2004, filed suit against the associations to collect the delinquent fees. Following a -3- Butler CA2015-07-141

lengthy legal battle, which included the filing of numerous motions for summary judgment, the

matter was eventually tried to the bench. After taking the matter under advisement, the trial

court issued a decision on August 3, 2007 that it then incorporated into a final judgment entry

on August 27, 2007 finding in favor of Connor & Murphy and awarding it a money judgment

for the unpaid assessments against the associations, including Applewood Village, Quail

Meadows, Twin Lakes, and Wellington Green. The associations then appealed.

The Appeal

{¶ 7} On March 30, 2009, this court issued a decision in Connor & Murphy, Ltd. v.

Applewood Village Homeowners' Assn., 12th Dist. Butler No. CA2007-09-213, 2009-Ohio-

1447, that addressed the validity and enforceability of the disputed agreement, finding the

agreement was a "whole and complete contract binding all the parties thereto."1 Id. at ¶ 50.

In so holding, this court stated, in pertinent part:

The 1991 Agreement sets forth the parties, the terms, and the consideration. In short, as previously stated, it permits the residents of the Association members to utilize the recreational facilities in exchange for a fee. The Agreement also imposes, upon Connor, the obligations of providing insurance and maintenance for the facilities. Although the Agreement states that it is intended to modify the prior easements executed by the Associations, it also specifically states that it is controlling with regard to any conflict between it and the easements. Simply put, regardless of whether it claims to modify the underlying easements, this Agreement sets forth all terms, and contains all elements, necessary to create a valid, binding contract. Therefore, we cannot say that the trial court erred in determining that the 1991 Agreement is legal and binding in its own right and without regard to the validity of any prior easements.

Id. at ¶ 53.

{¶ 8} This court further determined that the agreement did not constitute an

easement, but was actually a license to the members of the various associations for the use

1. This court's decision was authored by a panel of judges from the Second District Court of Appeals, sitting by assignment of the Chief Justice of Ohio, pursuant to Section 5(A)(3), Article IV, of the Ohio Constitution. -4- Butler CA2015-07-141

of the recreational facilities in exchange for a fee. Id. at ¶ 67 and 69. As this court stated,

"[s]hould the Associations fail to pay the requisite fee, the privilege of utilizing the recreational

facilities can be suspended[.]" Id. at 68. It is undisputed that no appeal was taken from this

decision.

The Fall of Wellington Green and the Rise of English Meadows

{¶ 9} While the appeal was pending, on January 2, 2008, the owners of Wellington

Green terminated that association and contemporaneously established a new condominium

association, English Meadows. Wellington Green, therefore, never paid on the money

judgment rendered against it by the trial court on August 27, 2007 and subsequently affirmed

by this court on March 30, 2009. As a result, on February 22, 2012, the Connor Group, a

Real Estate Investment Firm, LLC ("Connor Group"), the successor to Connor & Murphy,

filed suit against Wellington Green, English Meadows, and the 41 individual condominium

owners, seeking to collect upon that money judgment based on a theory of successor liability.

{¶ 10} On August 31, 2012, the trial court issued a decision finding English Meadows

could not be held liable under the successor liability doctrine as a matter of law. The Connor

Group, a Real Estate Investment Firm, LLC v. Wellington Green Condominium Unit Owners

Assn., Butler C.P. No. CV2012 02 0718 (Aug. 31, 2012). In so holding, the trial court stated:

Application of the successor liability doctrine to this case initially requires a finding that English Meadows purchased all or substantially all of Wellington Green's assets. Plaintiffs did not allege such a purchase in their complaint, and have not addressed this requirement in their memorandum. Indeed, there is no evidence whatever in the record that English Meadows "purchased" anything from Wellington Green. This court has conducted substantial research on this issue and has uncovered no case where the doctrine of successor liability was applied outside the context of an acquisition of all or substantially all of the assets by the alleged successor. Because that did not occur here, plaintiffs' claim for successor liability must fail.

Continuing, albeit in dicta, the trial court then stated that "[i]f the doctrine did apply, the court

-5- Butler CA2015-07-141

would agree that English Meadows is liable as a successor to Wellington Green because the

'mere continuation' exception to non-liability applies." It is undisputed that no appeal was

taken from this decision.

The Litigation Returns

{¶ 11} On January 29, 2013, BWIP purchased the recreational facilities from Connor

Group, a transaction that once again prompted the various associations to stop paying their

required monthly user fees. Approximately one year later, on January 6, 2014, BWIP filed

suit against Applewood Village, Quail Meadows, and Twin Lakes to collect the unpaid

assessments alleging a breach of contract. In response, Applewood Village, Quail Meadows,

and Twin Lakes, all of whom were original signatories to the agreement, claimed they were

not liable for the unpaid assessment since a license is not assignable, thereby rendering the

agreement void upon BWIP's purchase. BWIP also filed suit against English Meadows, who

admitted in its answer to being a "successor association" to Wellington Green, seeking to

collect the unpaid assessments it had not paid to BWIP after BWIP purchased the

recreational facilities. The parties then filed competing motions for summary judgment.

{¶ 12} On April 21, 2015 and July 2, 2015, the trial court issued two separate

decisions that collectively granted summary judgment to BWIP. In reaching this decision, the

trial court found Applewood Village, Quail Meadows, and Twin Lakes were still bound by the

agreement even after BWIP's purchase since the agreement entered into by the parties was

a valid contract that established an assignable license that was intended to bind their

successors and assigns. In addition, as it relates to BWIP's claims against English

Meadows, the trial court found English Meadows made a judicial admission in its answer that

it was a "successor association" to Wellington Green, thereby also rendering it liable to BWIP

under the agreement for the unpaid assessments it had not paid to BWIP after BWIP

purchased the recreational facilities. -6- Butler CA2015-07-141

{¶ 13} Applewood Village, English Meadows, Quail Meadows, and Twin Lakes now

appeal from the trial court's decision granting summary judgment to BWIP, raising three

assignments of error for review.

Summary Judgment Standard of Review

{¶ 14} Summary judgment is a procedural device used to terminate litigation when

there are no issues in a case requiring a formal trial. Roberts v. RMB Ents., Inc., 197 Ohio

App.3d 435, 2011-Ohio-6223, ¶ 6 (12th Dist.). On appeal, a trial court's decision granting

summary judgment is reviewed de novo. Moody v. Pilot Travel Ctrs., L.L.C., 12th Dist. Butler

No. CA2011-07-141, 2012-Ohio-1478, ¶ 7, citing Burgess v. Tackas, 125 Ohio App.3d 294,

296 (8th Dist.1998). In applying the de novo standard, the appellate court is required to

"'us[e] the same standard that the trial court should have used, and * * * examine the

evidence to determine whether as a matter of law no genuine issues exist for trial.'" Bravard

v. Curran, 155 Ohio App.3d 713, 2004-Ohio-181, ¶ 9 (12th Dist.), quoting Brewer v.

Cleveland Bd. of Edn., 122 Ohio App.3d 378, 383 (8th Dist.1997).

{¶ 15} Assignment of Error No. 1:

{¶ 16} THE TRIAL COURT ERRED WHEN IT INTERPRETED THE ASSIGNMENT

LANGUAGE IN FINDING THE CONTRACT IN QUESTION WAS A TRANSFERABLE

LICENSE.

{¶ 17} Assignment of Error No. 2:

{¶ 18} THE TRIAL COURT ERRED WHEN IT FOUND THAT A LICENSE THAT IS

NOT COUPLED WITH AN INTEREST CAN BE TRANSFERRED.

{¶ 19} In the first and second assignments of error, the associations argue the trial

court erred by granting summary judgment to BWIP upon finding the disputed agreement

was a valid contract that established an assignable license. The trial court's decision,

-7- Butler CA2015-07-141

however, properly complies with this court's holding in Connor & Murphy, Ltd. v. Applewood

Village Homeowners' Assn., 12th Dist. Butler No. CA2007-09-213, 2009-Ohio-1447. We

stand by the analysis employed in reaching that decision and decline the associations'

invitation to reconsider this court's decision on the matter. We also decline the associations'

alternative request to treat that decision as an "amendment to the agreement," thereby

eliminating the automatic renewal provision contained in Section 4.7 of the agreement. In

reaching this decision, we reiterate that no appeal was ever taken from that decision, a

decision that has now served as the law of the case for over seven years. Accordingly,

finding no error in the trial court's decision, the first and second assignments of error are

overruled.

{¶ 20} Assignment of Error No. 3:

{¶ 21} THE TRIAL COURT ERRED WHEN IT FOUND THAT THE CLAIMS AGAINST

ENGLISH MEADOWS ARE NOT BARRED BY COLLATERAL ESTOPPEL AND RES

JUDICATA.

{¶ 22} In the third assignment of error, English Meadows argues the trial court erred by

finding BWIP's claims against it were not barred by collateral estoppel and res judicata when

considering the trial court's earlier decision in The Connor Group, a Real Estate Investment

Firm, LLC v. Wellington Green Condominium Unit Owners Assn., Butler C.P. No. CV2012 02

0718 (Aug. 31, 2012).

{¶ 23} However, as a simple review of the record reveals, that case dealt with the

issue of whether Connor Group could hold English Meadows liable under the successor

liability doctrine in order to collect upon the money judgment rendered against its

predecessor, Wellington Green. On the other hand, this case deals with the issue of whether

BWIP could collect unpaid assessments from English Meadows that English Meadows had

not paid to BWIP after BWIP purchased the recreational facilities. These are two separate -8- Butler CA2015-07-141

issues relating to two separate claims for which neither collateral estoppel nor res judicata

would apply.

{¶ 24} Moreover, contrary to English Meadows' claim otherwise, simply because the

trial court previously determined that the successor liability doctrine did not apply to English

Meadows as a matter of law does not mean English Meadows was not a "successor" to

Wellington Green as that term is used within Section 4.7 of the agreement. Again, as that

section specifically states, the agreement shall "bind the property" and "inure to the benefit of

the parties and their respective successors and assigns[.]" A "successor," as defined by

Black's Law Dictionary (10th Ed.2014), is defined as "[s]omeone who succeeds to the office,

rights, responsibilities, or place of another; one who replaces or follows a predecessor."

Therefore, because English Meadows admitted to being a "successor association" to

Wellington Green in its answer to BWIP's complaint, we find no error in the trial court's

decision awarding summary judgment to BWIP. Accordingly, the third assignment of error is

also overruled.

{¶ 25} Judgment affirmed.

PIPER, P.J., and HENDRICKSON, J., concur.

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