Layannoor, Inc. v. United Ohio Ins. Co.

Opinion

[Cite as Layannoor, Inc. v. United Ohio Ins. Co., 2026-Ohio-2939.]

COURT OF APPEALS OF OHIO

EIGHTH APPELLATE DISTRICT COUNTY OF CUYAHOGA

LAYANNOOR, INC., :

Plaintiff-Appellee, : No. 115844 v. :

UNITED OHIO INSURANCE CO., ET AL.:

Defendants-Appellants. :

JOURNAL ENTRY AND OPINION

JUDGMENT: REVERSED RELEASED AND JOURNALIZED: July 30, 2026

Civil Appeal from the Cuyahoga County Court of Common Pleas Case No. CV-24-998708

Appearances:

Shapero & Green, LLC, Brian Green, and Sean Burke, for appellee.

Ritzler, Coughlin, & Paglia, Ltd., Robert J. DuBois, and Jonathon Angarola, for appellant.

SEAN C. GALLAGHER, J.:

United Ohio Insurance Co. (“United Ohio”) appeals the granting of

Layannoor, Inc.’s motion for relief from judgment filed under Civ.R. 60. For the

following reasons, we reverse that decision and reinstate the final judgment. In June 2024, Layannoor, Inc., filed the underlying action against

United Ohio and its agent, Alan S. Hanlin & Associates, Inc. (“Hanlin”), asserting

breach of contract and other related claims arising from an insurance dispute.

Layannoor operates a convenience store in a leased building that incurred fire

damage. Its policy listed Layannoor as the owner of the building instead of reflecting

its status as a tenant and including the owner as an additional insured under the

policy, as is generally required to obtain the policy in question. Layannoor was

represented by attorneys John Spellacy and Sean Allan from the inception of the

lawsuit. United Ohio filed an answer and counterclaim seeking $100,000 in

reimbursement for an initial payment issued to Layannoor under the belief it owned

the property.

Spellacy, with leave of court, withdrew from the case in December

2024. In mid-March 2025, Allan sought to withdraw from the case because of the

lack of contact with either principal of Layannoor, Amal Saleh or Loay Odeh, a

married couple both of whom reside at 3387 Napa Boulevard in Avon, Ohio.

According to the filing, Allan had been unable to reach his client in three months,

impeding his ability to respond to the then-ongoing discovery.

In April 2026, the trial court granted Allan leave to withdraw and

ordered Layannoor, a corporate entity, to retain new counsel as required by Ohio

law for participation in the ongoing litigation. The court documents granting leave

to withdraw and setting a scheduling conference were served to Layannoor through

Federal Express at the 3387 Napa Boulevard address. The following month, with no contact from any representative of Layannoor, the trial court set the matter for a

default hearing on United Ohio’s counterclaim. United Ohio’s motion for default

was also sent to Layannoor at the 3387 Napa Boulevard address. Following the

default hearing in June 2026, a hearing that no representative of Layannoor

attended, Layannoor’s claims were dismissed without prejudice for failure to

prosecute. On July 2, 2025, default judgment was granted in United Ohio’s favor

declaring the insurance policy void based on the misidentification of the owner and

a judgment was entered in the amount of $100,000 for reimbursement of monies

forwarded.

Finally in September 2026, ten months since any representative for

Layannoor had been in contact with its attorney or the trial court and more than two

months following the granting of final judgment, Layannoor retained new counsel

to file a motion for relief from judgment under Civ.R. 60(B), claiming its

disappearance was because of excusable neglect. According to the evidence

presented, Saleh claims to have never received any of the notices, documents, or

correspondence sent to their home or business address beginning in March 2025.

Saleh conceded that there were no issues with mail at the 3387 Napa Boulevard

address, but Odeh claimed to have issues with receiving mail at the business

address. The notice of default judgment issued in July was sent to Layannoor’s

business address.

At the hearing on the motion for relief from judgment, Saleh

acknowledged, in regard to a question about receiving mail at their home address, that “[m]aybe some mail came in, but it was not — at some there was, like, a lot of

mail coming in, and I thought that we gave all the papers necessary for them, so

probably not, like, looked at.” Tr. 13:6-10. Thus, Saleh testified that it was not

necessarily a failure of receipt, but a failure to review all documents received. Odeh,

for his part, conceded that they were aware of the documents Allan sent regarding

his motion to withdraw. Tr. 30:10-18; tr. 31:14-17; tr. 37:8-22; tr. 38:12-18. He

disregarded that information because he agreed with letting Allan withdraw after

their last meeting in December 2024. In his view, Allan unreasonably requested

repair invoices that Layannoor was unable to obtain and Odeh disagreed with

Allan’s including Hanlin as a defendant in the original complaint filed months

earlier. He explained that there was no further contact with Allan because

Layannoor intended to retain new counsel.

Coupled with Allan’s statement in seeking to withdraw, Odeh’s

testimony confirmed that Layannoor had no contact with its counsel starting in mid-

December 2024. More important, after receiving the information regarding Allan’s

April withdrawal from the litigation, Odeh testified that he intended to not take any

steps to find replacement counsel for Layannoor until the final pretrial set for mid-

October 2025, a date set in the trial court’s December 5, 2024 scheduling order that

included earlier pretrial deadlines. Tr. 39:2-4.

The trial court deemed Layannoor’s systemic disregard of the

proceeding excusable neglect based on what the trial court deemed to be “confusion”

from Layannoor’s attorneys withdrawing from the matter. The trial court then vacated the final judgment and sua sponte reinstated Layannoor’s dismissed claims,

which were not subject to a Civ.R. 60(B) motion for relief from final judgment. This

appeal timely followed.

Under the second assignment of error, which resolves all issues in

this appeal, United Ohio claims the trial court erred by granting Layannoor’s

motion.1 To prevail on its motion, Layannoor needed to establish “(1) a

meritorious claim or defense in the event relief is granted, (2) entitlement to relief

under one of the provisions of Civ.R. 60(B)(1) through (5), and (3) timeliness of

the motion.” State ex rel. Hatfield v. Miller, 2023-Ohio-429, ¶ 8, citing Strack v.

Pelton, 70 Ohio St.3d 172, 174 (1994). “Failure to meet any one of [these] factors

is fatal, as all three factors must be satisfied in order to grant relief.” In re L.D.M.,

2021-Ohio-1853, ¶ 28 (12th Dist.), citing Pelton at 174; see also Smith v. Hines,

2023-Ohio-107, ¶ 17 (6th Dist.).

“An appellate court reviews a decision on a Civ.R. 60(B) motion for

abuse of discretion.” State ex rel. Jackson v. Ohio Adult Parole Auth., 2014-Ohio-

2353, ¶ 21, citing Rose Chevrolet v. Adams, 36 Ohio St.3d 17, 21 (1988). An abuse

of discretion occurs when a court exercises “its judgment, in an unwarranted way,

in regard to a matter over which it has discretionary authority” or commits an error

of law. Johnson v. Abdullah, 2021-Ohio-3304, ¶ 35. “The abuse-of-discretion

1 In the first assignment of error, United Ohio challenges the trial court’s decision

sua sponte reinstating Layannoor’s claims that were dismissed without prejudice for the failure to prosecute. standard extends to the question whether a movant has demonstrated excusable

neglect.” State ex rel. Jackson at ¶ 22.

The Ohio Supreme Court has previously defined “excusable neglect”

in the negative, stating that “the inaction of a defendant is not ‘excusable neglect’

if it can be labeled as a ‘complete disregard for the judicial system.’” Kay v. Marc

Glassman, 76 Ohio St.3d 18, 20 (1996), quoting GTE Automatic Electric v. ARC

Industries, Inc., 47 Ohio St.2d 146, 153 (1976). “[T]he determination of whether

excusable neglect occurred ‘. . . must of necessity take into consideration all the

surrounding facts and circumstances.’” Rose Chevrolet at 21, quoting Colley v.

Bazewell, 64 Ohio St.2d 243, 249 (1980). In this regard, it has been concluded that

“[t]he failure to keep informed of the progress of an ongoing case does not qualify

as excusable neglect.” See Garrett v. Gortz, 2008-Ohio-4369 (8th Dist.) (“The

failure to ensure proper mail delivery and keep informed of the progress of an

ongoing case does not qualify as excusable neglect.”). This is because “[c]ases

finding excusable neglect typically involve special circumstances that justify the

neglect. Neglectful conduct is not excusable if the party seeking relief could have

prevented the circumstances from occurring.” Twymon v. Eagle Auto Parts, Inc.,

2022-Ohio-2360, ¶ 51 (8th Dist.), citing Dispatch Printing Co. v. Recovery Ltd.

Partnership, 2015-Ohio-1368, ¶ 13 (10th Dist.), and Stuller v. Price, 2003-Ohio-

583, ¶ 52 (10th Dist.).

A principal for Layannoor expressly stated that Layannoor had no

intention of retaining new counsel until the final pretrial, which was set for October 2025 — nearly a year after Layannoor first determined that Allan would not be its

attorney, and six months following Allan’s withdrawal of representation. Tr. 39:2-

4. All of this occurred during a time that discovery and other pretrial matters were

ongoing. Odeh, a designated representative for Layannoor, also admitted to

receiving Allan’s correspondence notifying of the withdrawal, meaning Layannoor,

a corporate entity, was aware it was unrepresented by a licensed Ohio attorney as is

required by Ohio law for it to continue to prosecute and defend against the claims.

See Lenz v. Kerr Bldg., 2022-Ohio-1427, ¶ 14 (6th Dist.), citing Union Sav. Assn.

v. Home Owners Aid, Inc., 23 Ohio St.2d 60 (1970). It is not apparent that there

was any confusion regarding the withdrawal of Allan, who represented Layannoor

from the inception of the action. Instead, the record demonstrates that Layannoor’s

representative consciously disregarded the ongoing litigation in which nothing

could occur until Layannoor retained new counsel to enter an appearance on its

behalf.

It has been held that a party’s incomprehension of the proper legal

procedures and the necessity for a corporate entity to be represented by a licensed

attorney in a judicial proceeding does not constitute inadvertence or excusable

neglect under Civ.R. 60(B)(1). Sunshine Ltd. v. Kidztown Early Learning Ctr.,

2013-Ohio-2092, ¶ 16 (8th Dist.), quoting Chase Bank United States, N.A. v.

Courey, 2010-Ohio-246, ¶ 26 (8th Dist.). Layannoor’s disregard for the proceeding

cannot be considered excusable neglect. The “[t]otal disregard for the judicial

system” has been described with the hypothetical “litigant who obstinately refuses to attend a deposition or a lawyer who repeatedly misses court dates.” State ex rel.

Jackson v. Ohio Adult Parole Auth., 2014-Ohio-2353, ¶ 35.

In this case, Odeh described himself as the main point of contact

between Layannoor and its attorney. Layannoor’s self-serving evidence of not

receiving any of the court notices is not relevant to the question before the trial court

in this case. This is not a case in which Layannoor was unaware of the proceedings

such that the failure to receive notices as to the default was dispositive as to the

question of excusable neglect. See Dispatch Printing, 2015-Ohio-1368, at ¶ 15 (10th

Dist.) (providing examples of when courts have determined that “excusable neglect

may exist when a party has neither knowledge nor actual notice of the lawsuit”),

citing Moore v. Emmanuel Family Training Ctr., 18 Ohio St.3d 64 (1985);

Doddridge v. Fitzpatrick, 53 Ohio St.2d 9 (1978); and Miami Sys., Corp. v. Dry

Cleaning Computer Sys., Inc., 90 Ohio App.3d 181 (1st Dist. 1993); Weaver v.

Colwell Fin. Corp., 73 Ohio App.3d 139 (8th Dist. 1992).

But regardless, as to that point, there is no dispute that Layannoor,

through its agent, received notice and approved of Allan’s withdrawal from

representing Layannoor. Layannoor, through Odeh, also made a conscious decision

to forgo retaining new counsel, leaving the corporate entity unrepresented in

ongoing litigation for nearly a year after Layannoor determined that new counsel

was desired and six months after Layannoor was left unrepresented. Layannoor

could not prosecute or defend claims without a licensed attorney. During this time,

no discovery or any other pretrial preparation could take place. Layannoor, as the party seeking relief, could have guarded against the

default outcome by simply retaining new counsel, or by at least attempting to contact

the court to request additional time. See, e.g., Smith v. Hines, 2023-Ohio-107, ¶ 25

(6th Dist.) (no excusable neglect where pro se litigant exhibited a complete lack of

attention to the process of the court after counsel withdrew). Instead, Layannoor,

through its agent, expressed an intent to consciously ignore the proceeding for

nearly a year, with no intention of retaining new counsel until before the mid-

October final pretrial conference. See, e.g., Delitoy v. I. Stylez Hair & Nails Design,

2020-Ohio-3370, ¶ 27 (8th Dist.) (a motion for relief from judgment was properly

denied where the defendant ignored several notices from the trial court and service

of numerous filings were sent to a verified address); Griffey v. Rajan, 33 Ohio St.3d

75, 80 (1987) (“A disregard for the judicial system and the right of appellee does not

necessarily mean an intentional disregard.” (Emphasis deleted.)). That final

pretrial conference was not a preliminary event; it was meant to occur after all other

pretrial proceedings had been completed, including discovery. Thus, Layannoor

ignored the entirety of the proceeding, not just the default.

The trial court found this conduct to be excusable neglect, but without

any other distinguishing fact, that conclusion demonstrates an arbitrariness over the

decision to grant relief — it is not supported by the facts and circumstances

presented as applied through the lens of authority defining the phrase “excusable

neglect.” Importantly, this conclusion is not based on any reweighing of evidence as

Layannoor contends in response. Odeh’s testimony was undisputed, especially as it pertained to the stated intent to leave Layannoor unrepresented in the ongoing

litigation for at least six months while discovery and other pretrial procedural

processes were underway. It was not just the default proceeding that was ignored,

but the entirety of the pretrial proceeding meant to prepare for the final pretrial

conference in October 2025 and the trial set for the following month. Waiting to

retain new counsel until the final pretrial would do nothing but cause unwarranted

delay.

It is understandable at one level how an experienced and

knowledgeable trial judge could feel relief from judgment was warranted. The desire

to decide a case on the merits and not on a procedural twist is a consideration that

should give pause. Granting relief under these facts, however, is a bridge too far in

light of the balance that must be maintained with the finality of judgments.

The apparent harshness of this result is acknowledged, but that is not

a unique feature of our conclusion. All cases in which a party is denied relief from a

final judgment involve upholding judgments. However, “the concept of ‘excusable

neglect’ must be construed in keeping with the proposition that Civ.R. 60(B)(1), is a

remedial rule to be liberally construed, while bearing in mind that Civ.R. 60(B)

constitutes an attempt to ‘strike a proper balance between the conflicting principles

that litigation must be brought to an end and justice should be done.’” Russell v.

McDonalds Inc., 2020-Ohio-4300, ¶ 21 (8th Dist.), quoting Colley v. Bazewell, 64

Ohio St.2d 243, 248 (1980), quoting 11 Wright & Miller, Federal Practice &

Procedure 140, § 2851. “Neglect is not excusable when it is a result of the party’s own ‘carelessness, inattention, or willful disregard of the process of the court’ rather

than a result of some ‘unexpected or unavoidable hindrance or accident.’” Russell

at ¶ 22 (8th Dist.), quoting Emery v. Smith, 2005-Ohio-5526, ¶ 16 (5th Dist.). If a

liberal application of Civ.R. 60(B) were applied to vacate the final judgment on these

facts, the balance between finality and doing justice would be irrevocably upended

— prioritizing the doctrine of resolving cases on the merits over a party’s conscious

disregard for ongoing judicial proceedings. Without more, we cannot condone a

party abandoning a case for nearly a year when the weight of case authority defines

that conduct to be inexcusable.2

The decision of the trial court is reversed, and the final judgment in

favor of United Ohio is reinstated.

It is ordered that appellant recover from appellee costs herein taxed.

The court finds there were reasonable grounds for this appeal.

It is ordered that a special mandate issue out of this court directing the

common pleas court to carry this judgment into execution.

2 Because the more specific provision of Civ.R. 60(B)(1) was identified as the basis

for relief, any arguments pertaining to the catch-all provision under Civ.R. 60(B)(5) are not cognizable. See Simon v. Simon, 2019-Ohio-777, ¶ 8 (9th Dist.), quoting Caruso- Ciresi, Inc. v. Lohman, 5 Ohio St.3d 64 (1983), paragraph one of the syllabus. Importantly, Layannoor does not claim otherwise in this appeal. A certified copy of this entry shall constitute the mandate pursuant to

Rule 27 of the Rules of Appellate Procedure.

______________________ SEAN C. GALLAGHER, JUDGE

MARY J. BOYLE, P.J., and DEENA R. CALABRESE, J., CONCUR