Gissentaner v. Buckeye Sauce Corp.

2022 Ohio 468
CourtOhio Court of Appeals
DecidedFebruary 17, 2022
Docket110678
StatusPublished

This text of 2022 Ohio 468 (Gissentaner v. Buckeye Sauce Corp.) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Gissentaner v. Buckeye Sauce Corp., 2022 Ohio 468 (Ohio Ct. App. 2022).

Opinion

[Cite as Gissentaner v. Buckeye Sauce Corp., 2022-Ohio-468.]

COURT OF APPEALS OF OHIO

EIGHTH APPELLATE DISTRICT COUNTY OF CUYAHOGA

RONEE GISSENTANER, ET AL., :

Plaintiffs-Appellants, : No. 110678 v. :

BUCKEYE SAUCE CORPORATION, ET AL., :

Defendants-Appellees. :

JOURNAL ENTRY AND OPINION

JUDGMENT: AFFIRMED RELEASED AND JOURNALIZED: February 17, 2022

Civil Appeal from the Cuyahoga County Court of Common Pleas Case No. CV-18-899474

Appearances:

Leslie Murray Law and John T. Murray, for appellants.

Eloff and Willson, LLP, Kathryn Gonser Eloff, and James Matthew Willson, for appellee the Estate of Essie Williams and Wanda Robinson.

Seeley, Savidge, Ebert & Gourash Co., LPA, Daniel F. Gourash, and Jeffrey S. Moeller, for appellee Buckeye Sauce Corporation. CORNELIUS J. O’SULLIVAN, JR., J.:

In this interlocutory appeal, plaintiffs-appellants, Ronee Gissentaner, et

al. (at times collectively referred to as “plaintiffs” or “appellants”), appeal the trial

court’s ruling that the proceeds of a policy of life insurance interpled to the court

should be paid to the estate of deceased shareholder Essie Williams. We affirm.

I. Procedural History and Facts

This appeal involves a family dispute between two branches of the

Williams family and the ownership and control of Hot Sauce Williams, which were

well-known Cleveland BBQ restaurants. Hot Sauce Williams was founded by the

Williams patriarch and passed down to the five brothers of the Williams family.

Defendant-appellee Buckeye Sauce Corporation (“Buckeye Sauce”) is an Ohio

corporation that operated the restaurants and has been closely held by members of

the Williams family since its incorporation in 1979.

In 1987, the five shareholders of Buckeye Sauce entered into a

“Memorandum of Buy-Sell Agreement” (“Buy-Sell Agreement”) funded by

$250,000 “key man” life insurance policies on each shareholder. The agreement

encumbered the sale of all shares of Buckeye Sauce during the lives of each

shareholder and required the corporation to purchase and “the estate of the

deceased shareholder (or any other recipient of the stock of the deceased

(s)hareholder)” to sell to Buckeye Sauce all the shares owned by the shareholder at

the time of his or her death. The two family branches in dispute in this case are the descendants of

brother James Williams (“James”), and the descendants of brother Willie Williams

(“Willie”) and his wife, Essie Williams (“Essie”).

From 1987 until November 2014, Buckeye Sauce maintained a life

insurance policy with National Life Insurance in force to fund its obligation to

redeem James’s shares upon his death. Buckeye Sauce made the premium

payments over the life of the policy with exception of two payments, which James

himself remitted. Essie’s key man life insurance policy was also with National Life

Insurance.

At the time of James’s death in November 2014, he had 100 shares of

Buckeye Sauce stock. The other living shareholders, Essie, and brother Herbert

Williams (“Herbert”) also each had 100 shares.1

Pursuant to the Buy-Sell Agreement, upon the death of a shareholder of

Buckeye Sauce, that shareholder’s shares were to be cashed out by Buckeye Sauce

pursuant to the terms of the agreement, leaving the surviving shareholders to

operate the company. In exchange for payment as provided, the shareholder’s estate

(or his or her heirs) were required by the agreement to surrender their stock

certificates, and their shares would be retired. Shortly before his death, James

signed a request for policy-ownership form and a beneficiary-change form

1 At some point, Herbert took ownership of his insurance under the agreement, cashed it out, and remitted his shares to Buckeye Sauce. His estate is not a party to this appeal. designating his granddaughter Ronee Gissentaner (“Ronee”), daughter Sandra

Gissentaner, and son Michael Williams as beneficiaries.2

James’s estate was filed in the Cuyahoga County Probate Court in

December 2014. See Estate of James Williams, Cuyahoga P.C. No. 2014-EST-

203117. In December 2017, the probate court approved the in-kind distribution of

James’s 100 shares of Buckeye Sauce to his heirs. In March 2018, the executor of

the James’s estate transferred 10.202 and 54.09 shares of Buckeye Sauce stock to

Ronee and James’s minor great-granddaughter, C.G., respectively.

A dispute arose between Ronee and Essie regarding the ownership and

management of the Hot Sauce Williams restaurants. Ronee and the other plaintiffs

filed this action as a minority shareholder action, alleging a breach of fiduciary duty,

breach of the duties of care and loyalty, self-dealing, conversion, and unjust

enrichment against various defendants, including Essie, both individually and as an

agent for Buckeye Sauce. Of note, plaintiffs alleged in their complaint that they were

bringing a “derivative action on behalf of corporate defendants.” Defendants

counterclaimed against Ronee for tortious interference of contract.

Herbert and Essie died days apart in January 2019. Prior to her death,

Essie changed her life insurance policy to name her daughter Wanda Robinson

(“Wanda”) and Willie’s children as beneficiaries.

2 This beneficiary change form was the subject of an interpleader action following James’s death. Natl Life Ins. Co. v. Michael Williams, Cuyahoga C.P. No. CV-15-842728. In May 2019, certain members of James’s branch of the family held a

shareholder meeting where Ronee was purportedly elected president and chair of

board of directors of Buckeye Sauce. According to National Life Insurance, Ronee

represented herself to the insurer as Buckeye Sauce’s president and chief operating

officer and made a claim for the policy proceeds of Essie’s estate. National Life

Insurance issued a check in the amount of $254,099.32 to Buckeye Sauce. National

Life Insurance quickly learned that Ronee was not the president of Buckeye Sauce

and that “another board of directors of the company” had met and elected Wanda

president and chief executive officer of Buckeye Sauce. National Life Insurance

voided the check it had issued to Ronee and filed a complaint for interpleader in the

trial court, stating that it had received multiple competing claims for the policy

proceeds from Essie’s estate by multiple persons and multiple board of directors of

Buckeye Sauce.

It was at this point that Wanda, both individually and in her role as

executor of Essie’s estate, and Willie’s children — Cameron Robinson, Kennedy

Robinson, and Warren Cooper — were added to the proceedings. National Life

Insurance moved to deposit the funds with the court, which the trial court granted,

and dismissed the insurer from the case. The defendants filed a counterclaim,

alleging breach of contract and tortious interference; they sought specific

performance and a declaratory judgment that the plaintiffs were not shareholders

of Buckeye Sauce. Plaintiffs, through motions for summary judgment, sought a

declaration that they were indeed shareholders in Buckeye Sauce and should be

allowed to proceed as management of the corporation pursuant to the May 2019

shareholder meeting (that was attended by members of only James’s branch of the

family). Buckeye Sauce argued that the plaintiffs were not shareholders because the

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2022 Ohio 468, Counsel Stack Legal Research, https://law.counselstack.com/opinion/gissentaner-v-buckeye-sauce-corp-ohioctapp-2022.