Crawford v. Stan

2012 Ohio 3624

• Court: Ohio Court of Appeals
• Decided: August 6, 2012
• Docket: 2011CA00197
• Status: Published

Opinion

[Cite as Crawford v. Stan, 2012-Ohio-3624.]

COURT OF APPEALS STARK COUNTY, OHIO FIFTH APPELLATE DISTRICT

HOWARD R. CRAWFORD : JUDGES: : : Hon. Patricia A. Delaney, P.J. Plaintiff-Appellant : Hon. William B. Hoffman, J. : Hon. Sheila G. Farmer, J. -vs- : : Case No. 2011CA00197 TERRY M. STAN : : : Defendant-Appellee : OPINION

CHARACTER OF PROCEEDING: Appeal from the Canton Municipal Court, Case No. 2011CVI3621

JUDGMENT: AFFIRMED

DATE OF JUDGMENT ENTRY: August 6, 2012

APPEARANCES:

For Appellant: For Appellee:

HOWARD R. CRAWFORD, PRO SE MICHAEL P. ZIRPOLO 9981 E. Lincoln Way Suite 206 Belden Village Tower Orrville, OH 44667 4450 Belden Village St., NW Canton, OH 44718

Delaney, P.J. {¶1} Plaintiff-Appellant Howard R. Crawford appeals the August 12, 2011

judgment entry of the Canton Municipal Court. Defendant-Appellee is Terry M. Stan.

FACTS AND PROCEDURAL HISTORY

{¶2} Defendant-Appellee Terry M. Stan (“Seller”) purchased a 2003 Chevy

Blazer on July 11, 2009 from Bobs Auto Sales. The vehicle had 52,364 miles on it

and Seller paid $7,346.70 to purchase the vehicle. The vehicle’s buyers order

contains the following language: “VEHICLE SOLD AS IT. NO WARRANTY. IT HAS

BEEN FULLY DISCLOSED TO TERRY M. STAN THAT THE 2003 S10 BLAZER

STK.# 9870 WAS A MANUFACTURER BUY BACK.” The note is followed by the

signature of Seller.

{¶3} R.C. 1345.71(G) defines a “buyback” motor vehicle as follows:

“Buyback” means a motor vehicle that has been replaced or

repurchased by a manufacturer as the result of a court judgment, a

determination of an informal dispute settlement mechanism, or a

settlement agreed to by a consumer regardless of whether it is in the

context of a court, an informal dispute settlement mechanism, or

otherwise, in this or any other state, in which the consumer has asserted

that the motor vehicle does not conform to the warranty, has presented

documentation to establish that a nonconformity exists pursuant to

section 1345.72 or 1345.73 of the Revised Code, and has requested

replacement or repurchase of the vehicle.

{¶4} Seller testified he learned the buyback occurred in August 2004 because

the original purchaser encountered difficulties with the brakes and a leak in the driver’s side door. The manufacturer took the vehicle back, repaired the defects, and resold

the vehicle. The vehicle had 7,854 miles at the time it was taken back by the

manufacturer. Since purchasing the vehicle, Seller testified the vehicle had no major

repairs.

{¶5} R.C. 1345.76(C) states that a buyback vehicle may not be resold unless

the manufacturer obtains a new certificate of title for the vehicle, which designates the

vehicle as a buyback. The clerk shall issue a buyback certificate of title for the vehicle

on a form, prescribed by the registrar of motor vehicles, that bears or is stamped on its

face with the words, “BUYBACK: This vehicle was returned to the manufacturer

because it may not have conformed to its warranty” in black boldface letters in an

appropriate location as determined by the registrar. Id. “Every subsequent certificate

of title, memorandum certificate of title, or duplicate copy of a certificate of title or

memorandum certificate of title issued for the buyback also shall bear or be stamped

on its face with the words ‘BUYBACK: This vehicle was returned to the manufacturer

because it may not have conformed to its warranty.’ in black boldface letters in the

appropriate location.” Id.

{¶6} The Stark County Clerk of Courts issued a Certificate of Title for the

vehicle on July 15, 2009. The Certificate of Title does not contain any language that

the vehicle was a buyback vehicle.

{¶7} In 2011, Seller listed the vehicle for sale on Craig’s List. Plaintiff-

Appellant Howard R. Crawford (“Buyer”) saw the advertisement and contacted Seller

about the vehicle. Seller did not tell Buyer the vehicle was a buyback vehicle and

Buyer did not ask. Buyer asked Seller questions about the repair history vehicle, but Buyer did not do any prior independent research on the vehicle, such as obtaining a

Carfax report. Buyer took the vehicle for a test drive. After the test drive, Buyer

offered $7,000.00 cash to purchase the vehicle and Seller accepted. The transaction

between the parties lasted 45 minutes. On May 16, 2011, the parties entered into a

Bill of Sale that stated, “SALE IS FINAL AND CONDITION IS ‘AS IS.’”

{¶8} Shortly after purchasing the vehicle, Buyer was looking in the glove

compartment and found documentation stating the vehicle was a buyback vehicle.

Buyer contacted the Seller and demanded Seller refund half of the purchase price.

Seller refused based on the “as is” language of the Bill of Sale.

{¶9} Buyer filed a Smalls Claims Complaint with the Canton Municipal Court

on May 27, 2011. Buyer alleged Seller engaged in consumer fraud in the purchase of

the vehicle and demanded $3,000 in damages.

{¶10} The matter went to trial before the magistrate. At trial, Buyer testified

and presented evidence, including a Carfax report that listed the vehicle as a buyback

vehicle. (Plaintiff’s Exhibit 5.) Seller testified and presented one witness. On June

29, 2011, the magistrate concluded Buyer failed to establish Seller engaged in fraud in

the transaction, Buyer failed to establish he had suffered damages, and therefore

recommended the complaint be dismissed.

{¶11} Buyer filed objections to the magistrate’s recommendation. Seller did

not file a response.

{¶12} On August 12, 2011, the trial court overruled Buyer’s objections and

adopted the recommendation of the magistrate. The trial court found Seller had no duty to disclose the buyback status of the vehicle to Buyer based on the business

transaction between two private parties and the “as is” language in the Bill of Sale.

{¶13} It is from this decision Buyer now appeals.

ASSIGNMENTS OF ERROR

{¶14} Buyer raises two Assignments of Error:

{¶15} “I. THE TRIAL COURT ERRED IN HOLDING THAT THE DEFENDANT

DID NOT HAVE A DUTY TO DISCLOSE THAT THE VEHICLE WAS A ‘BUYBACK’

VEHICLE, JUDGMENT ENTRY P. 5.”

{¶16} “II. THE TRIAL COURT ERRED IN HOLDING THAT THERE WAS NO

REPRESENTATION MADE IN THIS CASE ABOUT THE BUYBACK STATUS OF THE

TRUCK, JUDGMENT ENTRY P. 3.”

ANALYSIS

DUTY TO DISCLOSE

{¶17} Buyer argues in his first Assignment of Error the trial court erred by

finding Seller had no duty to disclose the vehicle was a buyback vehicle. We

disagree.

{¶18} Buyer’s first Assignment of Error raises a question of law as to the duty

to disclose. Questions of law are reviewed by the court de novo. Erie Ins. Co. v.

Paradise, 5th Dist. No. 2008CA00084, 2009-Ohio-4005, ¶ 12.

{¶19} Buyer brought his complaint against Seller arguing Seller engaged in

fraud.1 To prove a common law claim of fraud, a plaintiff must establish the following

elements: (1) a representation or, where there is a duty to disclose, concealment of a

1 Buyer did not bring an action pursuant to the Consumer Sales Practices Act, R.C. Chapter 1345, et al. fact, (2) which is material to the transaction at hand, (2) made falsely, with knowledge

of its falsity, or with such utter disregard and recklessness as to whether it is true or

false that knowledge may be inferred, (4) with the intent of misleading another into

relying upon it, (5) justifiable reliance upon the representation or concealment, and (6)

a resulting injury proximately caused by the reliance. Burr v. Stark County Board of

Commissioners, 23 Ohio St.3d 69, 491 N.E.2d 1101 (1986), paragraph two of the

syllabus.

{¶20} The elements of fraud must be established by clear and convincing

evidence. Clear and convincing evidence is that measure or degree of proof that will

produce in the mind of the trier of facts a firm belief or conviction as to the allegations

sought to be established. Cross v. Ledford, 161 Ohio St. 469, 120 N.E.2d 118 (1954).

The burden to prove fraud rests upon the party alleging the fraud. First Discount

Corp. v. Daken, 75 Ohio App. 33, 60 N.E.2d 711 (1st Dist. 1944), paragraph seven of

the syllabus.

{¶21} There is no dispute the evidence demonstrates Seller knew the vehicle

was a buyback vehicle. During the sale of the vehicle between Buyer and Seller,

Seller did not tell Buyer the vehicle was a buyback vehicle nor did Buyer ask about the

title status of the vehicle. With this evidence, Buyer does not present this Court with

the issue of a misrepresentation by the Seller, but rather this case involves a failure to

disclose by the Seller.

{¶22} This Court has held that fraud is committed by a failure to disclose only

when the person is under a duty to disclose, and the duty to disclose arises when one

party has information that the other party is entitled to know because of a fiduciary or another similar relation of trust and confidence between them. Advanced Production

Center, Inc. v. EMCO Maier Corp., 5th Dist. No. 2003CAE03020, 2003-Ohio-6206, ¶

14 citing Fed. Mgt. Co. v. Coopers & Lybrand, 137 Ohio App.3d 366, 383-384, 738

N.E.2d 842 (10th Dist. 2000). A “fiduciary relationship” is a relationship in which

special confidence and trust is reposed in the integrity and fidelity of another and there

is a resulting position of superiority or influence, acquired by virtue of this special trust.

Ed Schory & Sons, Inc. v. Soc. Natl. Bank, 75 Ohio St.3d 433, 442, 662 N.E.2d 1074

(1996). In business transactions where parties deal at arm’s length, each party is

presumed to have the opportunity to ascertain relevant facts available to others

similarly situated, and therefore, generally neither party has a duty to disclose material

information to the other. Advanced Production Center, Inc., supra, citing Blon v. Bank

One (1988), 35 Ohio St.3d 98, 101, 519 N.E.2d 363.

{¶23} In order to demonstrate fraud, Buyer must establish by clear and

convincing evidence the elements of fraud. The first element to establish is whether

there was a failure to disclose. In this case, Seller did not disclose the buyback status

of the vehicle to Buyer. However, the failure to disclose becomes an issue only if

there was a duty to disclose based upon a fiduciary relationship between the parties.

In this case, there is no evidence that a fiduciary relationship existed between the

parties. The undisputed evidence shows the sale of the vehicle was a business

transaction where the parties conducted the transaction at arm’s length. Accordingly,

we agree with the trial court’s thoroughly analyzed judgment that Seller did not have a

duty to disclose the buyback status of the vehicle to Buyer during the sales transaction

of the vehicle. {¶24} Buyer’s first Assignment of Error is overruled.

EVIDENCE OF MISREPRESENTATION

{¶25} Buyer argues in his second Assignment of Error the trial court erred in

finding that Seller did not misrepresent the history of the vehicle.

{¶26} We determined above that Buyer failed to establish Seller had a duty to

disclose the buyback status of the vehicle. Buyer argues in the alternative that the

facts establish Seller misrepresented the buyback status of the vehicle. Buyer argues

that by Seller telling Buyer during the sales transaction that the vehicle had no

problems, Seller misrepresented the status of the vehicle as a buyback vehicle.

{¶27} As an appellate court, we are not fact finders; we neither weigh the

evidence nor judge the credibility of witnesses. Our role is to determine whether there

is relevant, competent, and credible evidence upon which the fact finder could base

his or her judgment. Peterson v. Peterson, 5th Dist. No. CT2003–0049, 2004–Ohio–

4714, ¶ 10, citing Cross Truck v. Jeffries, 5th Dist. No. CA–5758, 1982 WL 2911 (Feb.

10, 1982).

{¶28} The facts in this case show that before Seller purchased the vehicle, the

mechanical problems that caused the vehicle to be bought back by the manufacturer

were repaired. Seller purchased the repaired vehicle and did not experience any

significant mechanical problems with the vehicle, due to the original problems or

otherwise, while Seller owned the vehicle. Seller stated to Buyer he experienced no

problems with the vehicle. We find Seller’s representations to Buyer as stated within

the record before us support the trial court’s conclusion that Seller did not make a

false representation to Buyer as to the buyback status of the vehicle. {¶29} Buyer’s second Assignment of Error is overruled.

CONCLUSION

{¶30} For these reasons, Appellant’s first and second Assignments of Error are

overruled.

{¶31} The judgment of Canton Municipal Court is affirmed.

By: Delaney, P.J.

Hoffman, J. and

Farmer, J. concur.

HON. PATRICIA A. DELANEY

HON. WILLIAM B. HOFFMAN

HON. SHEILA G. FARMER

PAD:kgb IN THE COURT OF APPEALS FOR STARK COUNTY, OHIO FIFTH APPELLATE DISTRICT

: HOWARD R. CRAWFORD : : Plaintiff - Appellant : JUDGMENT ENTRY : : -vs- : : Case No. 2011CA00197 TERRY M. STAN : : Defendant - Appellee : :

For the reasons stated in our accompanying Opinion on file, the judgment of the

Canton Municipal Court is affirmed. Costs assessed to Appellant.