Enervest Operating, L.L.C v. JSMB0912, L.L.C.

2018 Ohio 3322

• Court: Ohio Court of Appeals
• Decided: August 20, 2018
• Docket: 2016-P-0080
• Status: Published

Opinion

[Cite as Enervest Operating, L.L.C v. JSMB0912, L.L.C., 2018-Ohio-3322.]

IN THE COURT OF APPEALS

ELEVENTH APPELLATE DISTRICT

PORTAGE COUNTY, OHIO

ENERVEST OPERATING, L.L.C., : OPINION

Plaintiff, : CASE NO. 2016-P-0080 BRAD CROMES, PORTAGE : COUNTY TREASURER,

Intervenor-Appellee, :

- vs - :

JSMB0912 LLC, :

Defendant/Third Party : Plaintiff-Appellant,

CAG PROPERTY 101, LLC, :

Third Party Defendant. :

Civil Appeal from the Portage County Court of Common Pleas, Case No. 2013 CV 00604.

Judgment: Affirmed.

Victor V. Vigluicci, Portage County Prosecutor, and Denise L. Smith, Chief Assistant Prosecutor, 241 South Chestnut Street, Ravenna, OH 44266 (For Intervenor-Appellee).

Warner D. Mendenhall, The Law Offices of Warner Mendenhall, 190 North Union Street, Suite 201, Akron, OH 44304 (For Defendant/Third Party Plaintiff-Appellant).

COLLEEN MARY O’TOOLE, J. {¶1} JSMB0912, LLC appeals from the grant of summary judgment by the

Portage County Court of Common Pleas to Brad Cromes, Portage County Treasurer, on

the latter’s action for delinquent property taxes. For the reasons that follow, we affirm.

{¶2} This case involves two adjoining pieces of property in Suffield Township,

Portage County, Ohio. One evidently contains a manufacturing plant and office building.

It was purchased by EnerVest Operating L.L.C. in 2010. The other contains a small

sewage treatment plant, servicing the EnerVest facilities. In 2012, EnerVest attempted

to purchase the sewage treatment plant from its then owner, CAG Property 101, LLC.

The deal fell through, and CAG sold the property to JSMB0912.

{¶3} Evidently, JSMB0912 demanded additional money from EnerVest to use

the sewage treatment plant, which EnerVest denied it owed, citing to a 1995 agreement

between prior owners of the two properties, which set a perpetual fee running with the

land. June 11, 2013, EnerVest filed an action for declaratory judgment and breach of

contract against JSMB0912. Eventually, JSMB0912 answered and counterclaimed, and

filed a third party action against CAG, the prior owner of the sewage treatment plant, for

indemnity and to quiet title.

{¶4} On or about April 25, 2014, EnerVest and JSMB0912 entered a settlement

agreement, whereby EnerVest would purchase that portion of the JSMB0912 property

containing the sewage treatment plant for $135,000. In September 2014, EnerVest

moved the trial court to enforce the settlement. The trial court granted this motion in

March 2015. As JSMB0912 continued to balk in fulfilling its obligations under the

settlement, the trial court appointed Attorney James Masi as receiver to execute

JSMB0912’s obligations.

2 {¶5} October 6, 2015, Attorney Masi filed his first report, in which he informed

the trial court that the JSMB0912 property had been partitioned, and EnerVest had paid

the purchase price. Attorney Masi had recorded the appropriate deeds on or about

September 18, 2015. Attorney Masi reported that, after paying certain expenses, he

retained $131, 232.73, and requested an order from the trial court regarding its

disbursement. JSMB0912 owed $80,218.80 in delinquent taxes, plus interest, fees and

penalties on the property in question. The county treasurer moved to intervene in the

case in March 2016. JSMB0912 opposed the motion to intervene, which the trial court

granted in May 2016. The county treasurer filed his complaint, which JSMB0912

answered.

{¶6} June 21, 2016, EnerVest and JSMB0912 finally entered an agreed

judgment entry, whereby each dismissed, with prejudice any and all claims they

possessed against each other. This judgment entry contained appropriate findings and

language under Civ.R. 54(B), and was final and appealable when entered. Neither party

appealed.

{¶7} July 19, 2016, the country treasurer moved for summary judgment.

JSMB0912 did not oppose. November 28, 2016, the trial court granted the motion for

summary judgment. JSMB0912 timely appealed, assigning five errors.

{¶8} “Summary judgment is a procedural tool that terminates litigation and thus

should be entered with circumspection. Davis v. Loopco Industries, Inc., 66 Ohio St.3d

64, 66, 1993 Ohio 195, (***) (1993). Summary judgment is proper where (1) there is no

genuine issue of material fact remaining to be litigated; (2) the movant is entitled to

judgment as a matter of law; and (3) it appears from the evidence that reasonable minds

3 can come to but one conclusion, and, viewing the evidence in the non-moving party’s

favor, that conclusion favors the movant. See e.g. Civ.R. 56(C).

{¶9} “When considering a motion for summary judgment, the trial court may not

weigh the evidence or select among reasonable inferences. Dupler v. Mansfield Journal

Co., 64 Ohio St.2d 116, 121, (* * *) (1980). Rather, all doubts and questions must be

resolved in the non-moving party's favor. Murphy v. Reynoldsburg, 65 Ohio St.3d 356,

359, (* * *) (1992). Hence, a trial court is required to overrule a motion for summary

judgment where conflicting evidence exists and alternative reasonable inferences can be

drawn. Pierson v. Norfork Southern Corp., 11th Dist. No. 2002-A-0061, 2003-Ohio-6682,

¶36. In short, the central issue on summary judgment is, ‘whether the evidence presents

sufficient disagreement to require submission to a jury or whether it is so one-sided that

one party must prevail as a matter of law.’ Anderson v. Liberty Lobby, Inc., 477 U.S. 242,

251-252, (* * *) (1986). On appeal, we review a trial court's entry of summary judgment

de novo. Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 105, (* * *) (1996). (Parallel

citations omitted.) Meloy v. Circle K Store, 11th Dist. Portage No. 2012-P-0158, 2013-

Ohio-2837, ¶5-6.

{¶10} We consider JSMB0912’s fourth assignment of error first, since it

challenges our jurisdiction. It reads: “The court’s order granting summary judgment for

Brad Cromes did not contain the language required by Civ.R. 54(B).” Ohio courts of

appeal only possess jurisdiction over final appealable orders. Gaydosh v. Trumbull Cty.,

11th Dist. Trumbull No. 2016-T-0109, 2017-Ohio-5859, ¶15. Civ.R. 54(B) provides:

{¶11} “When more than one claim for relief is presented in an action whether as

a claim, counterclaim, cross-claim, or third-party claim, and whether arising out of the

same or separate transactions, or when multiple parties are involved, the court may enter

4 final judgment as to one or more but fewer than all of the claims or parties only upon an

express determination that there is no just reason for delay. In the absence of a

determination that there is no just reason for delay, any order or other form of decision,

however designated, which adjudicates fewer than all the claims or the rights and

liabilities of fewer than all the parties, shall not terminate the action as to any of the claims

or parties, and the order or other form of decision is subject to revision at any time before

the entry of judgment adjudicating all the claims and the rights and liabilities of all the

parties.”

{¶12} As JSMB0912 points out, the trial court’s judgment entry in favor of the

treasurer does not contain the findings and language required by Civ.R. 54(B).

JSMB0912 contends it should have, since its third party complaint against CAG remains

pending.

{¶13} We respectfully disagree. JSMB0912’s claims against CAG were for

indemnification, in case JSMB0912 was found liable to EnerVest, and to quiet title

regarding the property on which the sewage treatment plant stands. However, in the June

21, 2016 agreed judgment entry between EnerVest and JSMB0912, each party

dismissed, with prejudice, any claim it had against the other. JSMB0912 did not appeal

that judgment entry, which did contain Civ.R. 54(B) findings and language.

{¶14} In Noll v. Am. Tel. and Tel. Co., 63 Ohio App.3d 646, 648 (1st Dist.1989),

the court held:

{¶15} “We note the trial court did not expressly dispose of appellant’s claim for

injunctive relief, and that the judgment entry does not contain a Civ.R. 54(B) certification.

Even though all claims are not expressly adjudicated by the trial court, if the effect of the

judgment as to some of the claims is to render the remaining claims moot, then

5 compliance with Civ.R. 54(B), providing for a determination that there is no just reason

for delay, is not required to make the judgment final and appealable. General Acc. Ins.

Co. v. Insurance Co. of North America (1989), 44 Ohio St.3d 17, * * *; Wise v. Gursky

(1981, 66 Ohio St.2d 241, * * *.”

{¶16} In In re Guardianship of Weller, 2d Dist. Montgomery No. 24337, 2011-

Ohio-5816, ¶7, the court held:

{¶17} “‘The doctrine of mootness is rooted in the “case” or “controversy” language

of Section 2, Article III of the United States Constitution and in the general notion of judicial

restraint.’ James A. Keller, Inc. v. Flaherty (1991, 74 Ohio App.3d 788, 791, * * *. ‘While

Ohio has no constitutional counterpart to Section 2, Article III, the courts of Ohio have

long recognized that a court cannot entertain jurisdiction over a moot question.’ Id. ‘It

has been long and well established that it is the duty of every judicial tribunal to decide

actual controversies between parties legitimately affected by specific facts and to render

judgments which can be carried into effect. It has become settled judicial responsibility

for courts to refrain from giving opinions on abstract propositions and to avoid the

imposition by judgment of premature declarations or advice upon potential controversies.’

Fortner v. Thomas (1970), 22 Ohio St.2d 13, 14, * * *. In other words, an issue is moot

when it has no practical significance, being instead merely hypothetical or academic.”

(Parallel citations omitted.)

{¶18} By dismissing all of its claim against EnerVest, JSMB0912 rendered its

claims against CAG moot, and the judgment entry granting the treasurer summary

judgment did not require Civ.R. 54(B) findings or language to be final and appealable.

{¶19} The fourth assignment of error lacks merit.

6 {¶20} JSMB0912’s first assignment of error reads: “The receiver exceeded the

scope of his power by settling the claims between EnerVest and JSMB, and the trial court

erred by approving this action without a prior order.” It’s second assignment of error

reads: “TheReceiver exceeded the scope of his authority by withholding funds from

JSMB, and the trial court erred by continuing the receivership without any cognizable

reason to do so.” The receiver was appointed by the trial court to carry out JSMB0912’s

contractual obligations under the settlement agreement with EnerVest. If JSMB0912

wished to contest any aspect of his conduct, it was required to appeal from the June 21,

2016 agreed judgment entry dismissing all claims between EnerVest and JSMB0912.

JSMB0912 failed to appeal that judgment entry.

{¶21} The first and second assignments of error lack merit.

{¶22} JSMB0912’s fifth assignment of error reads: “The trial court erred by

ordering the June 11, 2013 (Dkt. 5) Temporary Restraining Order, which ordered JSMB

to continue to provide an illegal service.” In conjunction with its complaint, EnerVest

requested a temporary restraining order to prevent JSMB0912 from cutting off its use of

the sewage treatment plant. The trial court granted the TRO. JSMB0912 objects that no

operator of the sewage treatment plant (or EnerVest) had the proper certifications.

{¶23} Again, this assignment of error goes solely to the dispute between EnerVest

and JSMB0912, and the latter was required to appeal from the June 21, 2016 agreed

judgment entry settling the parties’ disputes if it had any objections.

{¶24} The fifth assignment of error lacks merit.

{¶25} JSMB0912’s third assignment of error reads: “The trial court erred in

allowing Brad Cromes, Portage County Treasurer, to intervene in the action.”

7 {¶26} The treasurer had moved to intervene pursuant to Civ.R. 24(A)(2),

“Intervention as of right,” which provides:

{¶27} “Upon timely application anyone shall be permitted to intervene in an action:

* * *; or (2) when the applicant claims an interest relating to the property or transaction

that is the subject of the action and the applicant is so situated that the disposition of the

action may as a practical matter impair or impede the applicant’s ability to protect that

interest, unless the applicant’s interest is adequately represented by existing parties.”

{¶28} In support of its assignment of error, JSMB0912 argues (1) that the

treasurer’s interest in payment of delinquent taxes would not have been impaired, since

JSMB0912 had entered a payment plan with the county; and (2) that the intervention was

untimely. JSMB0912 notes that the receiver received payment from EnerVest on or about

September 18, 2015, and had filed the necessary deeds regarding partition that same

day, but that the treasurer did not move to intervene until March 2, 2016.

{¶29} We review a trial court’s decision to grant or deny intervention pursuant to

Civ.R. 24(A)(2) for abuse of discretion. Freedom Mtge. Corp. v. Milhoan, 7th Dist.

Columbiana No. 13 CO 15, 2014-Ohio-881, ¶34. Intervention is to be granted liberally.

Id. The term “abuse of discretion” is one of art, connoting judgment exercised by a court

which neither comports with reason, nor the record. State v. Ferranto, 112 Ohio St. 667,

676-678 (1925). An abuse of discretion may be found when the trial court “applies the

wrong legal standard, misapplies the correct legal standard, or relies on clearly erroneous

findings of fact.” Thomas v. Cleveland, 176 Ohio App.3d 401, 2008-Ohio-1720, ¶15 (8th

Dist.)

{¶30} We do not find the trial court abused its discretion by allowing the treasurer

to intervene. The treasurer had an interest in the funds in the hands of the receiver, since

8 JSMB owed years of delinquent taxes. The trial court could reasonably find that the

treasurer’s interest in those funds might be impaired if the funds went directly to

JSMB0912, which had a history of not paying obligations. Neither EnerVest nor JSMB

adequately represented the treasurer’s interests. The former’s sole interest was to obtain

control of the sewage treatment facility. The latter had no particular interest in collecting

monies for the treasurer.

{¶31} Nor do we find the intervention untimely. The Supreme Court of Ohio set

forth the test for whether intervention is timely in State ex rel. First New Shiloh Baptist

Church v. Meagher, 82 Ohio St.3d 501, 503 (1998):

{¶32} “Whether a Civ.R. 24 motion to intervene is timely depends on the facts and

circumstances of the case. Norton v. Sanders (1989), 62 Ohio App.3d 39, 42, * * *;

NAACP v. New York, 413 U.S. 345, 366, * * *. The following factors are considered in

determining timeliness: ‘(1) the point to which the suit had progressed; (2) the purpose

for which intervention is sought; (3) the length of time preceding the application during

which the proposed intervenor knew or reasonably should have known of his interest in

the case; (4) the prejudice to the original parties due to the proposed intervenor’s failure

after he knew or reasonably should have known of his interest in the case to apply

promptly for intervention; and (5) the existence of unusual circumstances militating

against or in favor of intervention.’ Triax Co. v. TRW, Inc. (C.A.6, 1984), 724 F.2d 1224,

1228.”

{¶33} Consideration of these factors show that the motion to intervene in this case

was timely. The underlying lawsuit between EnerVest and JSMB0912 would not settle

until June 21, 2016, whereas the treasurer sought intervention March 2, 2016. The

intervention was sought for the proper purpose of procuring delinquent taxes. The earliest

9 the treasurer could have known that the receiver had funds available to satisfy JSMB’s

tax delinquencies was September 18, 2015: the treasurer sought intervention five and

one-half months later. The original parties, EnerVest and JSMB0912 suffered no

prejudice due to the intervention. The fact that JSMB0912 had owed taxes for a period

of years militated in favor of intervention.

{¶34} At oral argument, JSMB0912 argued that the motion to intervene was

untimely, and prejudiced it, because it resulted in a foreclosure action against is property.

We have searched the record diligently for evidence of this, but find nothing. If this in

happened, JSMB0912 was required to bring it to the notice of the trial court, and place

evidence in the record. We are bound by the record, and cannot decide matters not

raised in the trial court.

{¶35} JSMB0912 relies on the opinion in Heiney v. Godwin, 9th Dist. Summit No.

21784, 2004-Ohio-2117, for the proposition that a four month delay in seeking

intervention is unreasonable. Id. at ¶2-3, 8. That case is distinguishable: appellants only

sought intervention four days prior to trial. Id. at ¶8-11.

{¶36} The third assignment of error lacks merit.

{¶37} The judgment of the Portage County court of Common Pleas is affirmed.

DIANE V. GRENDELL, J.,

CYNTHIA WESTCOTT RICE, J.,

concur.