Inserra v. J.E.M. Building Corp., Unpublished Decision (11-22-2000)

CourtOhio Court of Appeals
DecidedNovember 22, 2000
DocketC.A. No. 2973-M.
StatusUnpublished

This text of Inserra v. J.E.M. Building Corp., Unpublished Decision (11-22-2000) (Inserra v. J.E.M. Building Corp., Unpublished Decision (11-22-2000)) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law.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
Inserra v. J.E.M. Building Corp., Unpublished Decision (11-22-2000), (Ohio Ct. App. 2000).

Opinion

Defendants J.E.M. Building Corporation and Joseph Pitzulo appeal from the judgment of the Medina Court of Common Pleas, following a jury trial, which found them liable for breach of contract and for violating Chapter 1345 of the Revised Code, Ohio's Consumer Sales Practices Act. This court affirms.

I.
On April 1, 1997, Thomas and Nancy Inserra contracted to buy a home at 4945 Shady Brooke Run in Medina from J.E.M. Building Corporation, a.k.a. JEM Homes ("J.E.M."), a closely-held Ohio Ccorporation. At all times, the couple dealt primarily with Joseph Pitzulo, who is a shareholder and principal of J.E.M. The Inserras lived in Chicago at the time of the purchase. Mr. Inserra had already begun work with a new employer in Medina, and the family was in the process of relocating here. When the Inserras viewed the home, it was approximately ninety-five percent complete.1 However, the Inserras decided that they wanted to have three-quarters of the basement "finished" with drywall, carpeting, an extra room, and a bathroom. They also included some upgrades in the rest of the house in the purchase agreement. The total purchase price was $365,000.

The initial agreement listed a closing date of April 25, 1997, but the contract was contingent upon the Inserras' sale of their Chicago home. When an initial sale of the Chicago home fell through, J.E.M. and the Inserras signed an addendum to the original contract. The addendum was signed on April 16, 1997, and it provided that all contingencies would be removed by May 25, 1997. The closing date, as set by the addendum, was July 11, 1997. The contract provided that J.E.M. would deliver to the Inserras a habitable home, with the included appointments.

The Inserras selected most of the options for the house in early April, before Mrs. Inserra had to return to Chicago. From April to July, Mr. Inserra visited the homesite frequently, to check on its progress. Prior to returning to Chicago for the closing on their Chicago house, Mr. Inserra contacted Mr. Pitzulo to confirm that the family could close on and move into the Medina home on July 11. Mr. Pitzulo repeatedly assured Mr. Inserra that the house would be completed by that time. The Inserras closed on the Chicago home on July 10, and immediately drove to Medina to close on the new house. The movers had packed the household furnishings and were en route to Medina.

When the Inserras arrived at the new home for the closing on July 11, they found that the house was not finished. There were no commodes; the kitchen appliances were not installed; the carpet was not installed; the deck was not completed; there was no landscaping; the water line was not in service; and the housing inspector had not conducted a final inspection or approved the house for occupancy. In short, the house was not habitable. Virtually no work had been done on the basement remodeling. Both parties agreed to a closing on July 18. Mr. Pitzulo assured the couple that the house would be completed by that date and he advised them that in the meantime he would leave the garage unlocked so the movers could store the furniture in the garage. However, when the movers arrived, the garage was locked and the Inserras had to arrange to have the furniture placed in storage. The Inserras and their two young children moved into the one-bedroom apartment in Cuyahoga Falls where Mr. Inserra had resided since his job transfer.

On July 18, the parties closed on the house. However, much of the work was still incomplete. In fact, the house was virtually the same condition as it had been the week before. There were no doors on the bathrooms, because much of the carpet had not yet been installed, thus delaying the installation of the doors. Part of the counter in the kitchen was not yet installed. The basement was in essentially the same condition as it had been the week before. The air conditioning did not work, and there were screens on only two windows. However, the city housing inspector granted a temporary residency permit and the family began to occupy the house on July 18.

Because of the large amount of work yet to be completed, Mr. Inserra insisted that $18,750 of the purchase money be held in escrow by Norwest Escrow, Inc. ("Norwest"). Mr. Inserra and Mr. Pitzulo signed a repair escrow agreement that assigned dollar amounts to the various portions of the construction yet to be completed. The agreement stated that upon the determination of an independent appraiser that Mr. Pitzulo had completed portions of the work, Mr. Pitzulo would be compensated in the amount assigned to the various tasks, in two "draws" or payments. The agreement provided for the work to be completed by August 15, 1997. Mr. Pitzulo determined that he was entitled to $11,000 of the escrow amount, and on August 7, he applied to Norwest for a "draw" of that amount. On August 8, Norwest's appraiser evaluated the work, and determined that Mr. Pitzulo was entitled to $5,750. However, upon being denied the requested $11,000, Mr. Pitzulo filed a mechanic's lien with the Medina County recorder's office, and left the job site.

On August 20, 1997, the Inserras filed the instant suit against J.E.M. Building Corporation, Mr. Pitzulo and Norwest Escrow Inc.2 Their claims against J.E.M. were for breach of contract on the original purchase, breach of contract on the escrow agreement, fraud, and violation of Ohio's Consumer Sales Practices Act (CSPA). The claim against Mr. Pitzulo was based on his alleged CSPA violations. On October 1, 1997, Mr. Inserra filed with the county recorder's office an affidavit which alleged that Mr. Pitzulo had "diverted resources" from the Inserra house to other properties owned by J.E.M. Mr. Pitzulo and J.E.M. counterclaimed for breach of the escrow agreement, defamation, slander of title, and Mr. Pitzulo filed a claim of harassment against the Inserras for naming him personally in their lawsuit. The Inserras hired another contractor to complete the work at a cost of $22,000. They incurred $7,239 in moving, storage and rental costs.

The case proceeded to a jury trial. The witnesses included: the Inserras, Mr. Pitzulo, his business partner Mrs. Bixler, the Norwest appraiser, the Norwest escrow officer, a supplier, and the Inserras' second contractor.

Mr. Pitzulo was vague on details, and his testimony was often contradicted by other evidence or his own inconsistent statements. For example, he denied that the meeting at the house on July 11 was intended to be a closing. However, the Norwest appraiser, who needed to conduct a final inspection for closing, was at the house on July 11 to conduct an inspection for that very purpose. Mr. Pitzulo also claimed that the Inserras continuously made changes to the original plans, and it was the constant changing of plans that caused the delay in completing the house. Mr. Pitzulo implied that one of the changes involved the carpeting, which was a Berber type with a definite pattern. However, the original sales contract of April 1 called for Berber carpet throughout, Mrs. Inserra testified that she made most of the selections in April and that she never changed the carpet ordered, and Mrs. Bixler of J.E.M. who handled these details testified that Mrs. Inserra chose the Berber carpeting when she was in town in April. Mrs. Bixler did not testify that the Inserras made changes to the original carpeting order. Mr. Pitzulo testified that the Inserras changed the basement plans to include a separate room, in addition to the bath. He later contradicted that statement and testified that the separate room was part of the original basement plan.

When asked about his request for the $11,000 draw, Mr. Pitzulo's testimony was vague.

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Bluebook (online)
Inserra v. J.E.M. Building Corp., Unpublished Decision (11-22-2000), Counsel Stack Legal Research, https://law.counselstack.com/opinion/inserra-v-jem-building-corp-unpublished-decision-11-22-2000-ohioctapp-2000.