Live Joyfully, L.L.C. v. PNC Bank, N.A.

2023 Ohio 3275, 224 N.E.3d 674
CourtOhio Court of Appeals
DecidedSeptember 15, 2023
Docket29755
StatusPublished

This text of 2023 Ohio 3275 (Live Joyfully, L.L.C. v. PNC Bank, N.A.) 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
Live Joyfully, L.L.C. v. PNC Bank, N.A., 2023 Ohio 3275, 224 N.E.3d 674 (Ohio Ct. App. 2023).

Opinion

[Cite as Live Joyfully, L.L.C. v. PNC Bank, N.A., 2023-Ohio-3275.]

IN THE COURT OF APPEALS OF OHIO SECOND APPELLATE DISTRICT MONTGOMERY COUNTY

LIVE JOYFULLY, LLC : : Appellant : C.A. No. 29755 : v. : Trial Court Case No. 2022 CV 4744 : PNC BANK, N.A. : (Civil Appeal from Common Pleas : Court) Appellee : :

...........

OPINION

Rendered on September 15, 2023

ANDREW M. ENGEL & MARC E. DANN, Attorneys for Appellant

H. TOBY SCHISLER, Attorney for Appellee

.............

HUFFMAN, J.

{¶ 1} Plaintiff-Appellant, Live Joyfully, LLC (“Live Joyfully”) appeals from the trial

court’s order denying its motion for default judgment and quiet title and dismissing its

claims for failure to state a claim upon which relief may be granted. Live Joyfully contends

that the trial court erred by dismissing its complaint sua sponte, erred by dismissing its

complaint with prejudice, and erred in denying its motion for default judgment. For the -2-

reasons outlined below, we conclude that the trial court erred by not providing Live

Joyfully any prior notice of its intention to dismiss the action or any opportunity to respond

or amend its complaint. We will reverse the trial court’s judgment on this basis. As

such, we need not address the alleged error related to dismissal with prejudice. We also

will not address the denial of Live Joyfully’s motion for default judgment, because it was

an interlocutory order.

I. Factual and Procedural Background

{¶ 2} In 2005, Serena and Bryan Dorsey purchased real property located at 157-

159 Lexington Avenue in Dayton, Ohio, and obtained a mortgage loan from National City

Bank securing the property. In October 2012, the Dorseys transferred the property to

Dennis Marsh. Thereafter, the property was transferred several times, eventually to Joan

Richards Gordon, Live Joyfully’s sole member, by quitclaim deed in December 2020.

Gordon then transferred the property to Live Joyfully, also by quitclaim deed, in February

2022. After acquiring the property, Live Joyfully allegedly discovered that the mortgage

from National City Bank remained unreleased.

{¶ 3} In its complaint, Live Joyfully claimed that it had attempted to arrange for the

release of the mortgage, but PNC Bank, which was National City Bank’s successor in

interest, purportedly refused to discuss the loan with Live Joyfully because it was not a

borrower on the loan. Thereafter, Live Joyfully filed an action to quiet title and for

declaratory judgment, asserting that the unreleased mortgage on the property was an

encumbrance clouding Live Joyfully’s title.

{¶ 4} PNC Bank did not file an answer or otherwise plead in response to Live -3-

Joyfully’s complaint. Live Joyfully then filed a motion for default judgment and quiet title

and subsequently filed a memorandum in support of its motion for default judgment and

quiet title. The trial court denied Live Joyfully’s motion for default judgment and sua sponte

dismissed its claims with prejudice for failure to state a claim upon which relief could be

granted.

{¶ 5} Live Joyfully timely appealed the trial court’s order. In response, PNC Bank

filed a disclaimer in this court, asserting that it had undertaken a diligent search of its

business records and had been unable to locate any open mortgage loan account related

to the property. Live Joyfully later filed a motion to deem conceded error in this court,

arguing that PNC Bank’s disclaimer was dispositive of this matter, seeking an order

deeming PNC Bank’s disclaimer as a notice of conceded error, and asking this court to

decide the matter on the merits.

II. Assignments of Error

{¶ 6} Live Joyfully asserts the following assignments of error:

(1) The trial court erred by overruling Appellant’s motion for default judgment.

(2) The trial court erred by dismissing the complaint sua sponte.

(3) The trial court erred in dismissing the complaint with prejudice.

We will consider the three assignments of error together.

{¶ 7} Under its first assignment of error, Live Joyfully contends that the trial court

erred in overruling its motion for default judgment because an invalid mortgage is a cloud

on title and any enforcement of the mortgage was time-barred. However, “[t]he trial court’s

denial of a motion for default judgment is not a final appealable order because the denial -4-

of such a motion neither determines the action nor prevents judgment in the action.” Ohio

Neighborhood Fin., Inc. v. Mackendrick, 2d Dist. Montgomery No. 23978, 2010-Ohio-

6098, ¶ 9, citing Jamestown Village Condo v. Market Media, 96 Ohio App.3d 678, 693,

645 N.E.2d 1265 (8th Dist.1994). Because this assignment of error involves an order that

was not a final appealable order, we will not address its merits, particularly given our

resolution of Live Joyfully’s second assignment of error.

{¶ 8} In its second and third assignments of error, Live Joyfully contends that the

trial court erred in dismissing its complaint with prejudice sua sponte without providing it

with prior notice.

{¶ 9} A trial court’s dismissal of an action is reviewed to determine if the court

abused its discretion. Tarver v. IRS Dept., 2d Dist. Montgomery No. 26741, 2016-Ohio-

3199, ¶ 2, citing State ex rel. Fogle v. Steiner, 74 Ohio St.3d 158, 656 N.E.2d 1288 (1995).

A court abuses its discretion by acting in a manner that is unreasonable, arbitrary, or

unconscionable. Id., citing State ex rel. Askew v. Goldhart, 75 Ohio St.3d 608, 665 N.E.2d

200 (1996). A trial court’s decision is unreasonable if not supported by a sound reasoning

process. Id., citing AAAA Ents., Inc. v. River Place Community Urban Redevelopment

Corp., 50 Ohio St.3d 157, 553 N.E.2d 597 (1990).

{¶ 10} We recognize that a trial court’s dismissal for failure to state a claim is

generally made following a motion to dismiss pursuant to Civ.R. 12(B)(6), which is

reviewed de novo. Perrysburg Twp. v. Rossford, 103 Ohio St. 3d 79, 2004-Ohio-4362,

814 N.E.2d 44, ¶ 5. However, since no motion to dismiss was filed in the trial court, and

because Live Joyfully was given no opportunity to respond to a motion, the issue in this -5-

appeal is the trial court’s exercise of its discretion to sua sponte dismiss the complaint

without prior notice to the parties and an opportunity to be heard.

{¶ 11} We have held that “[t]he court may not sua sponte enter an order dismissing

a case on its merits involuntarily absent prior notice to the affected parties.” Owens v.

Bailar, 2d Dist. Champaign No. 2008-CA-29, 2009-Ohio-2741, ¶ 12, citing Ohio Furniture

Co. v. Mindala, 22 Ohio St.3d 99, 488 N.E.2d 881 (1986). In Ohio Furniture, the Supreme

Court of Ohio stated: “We hold that the notice requirement of Civ.R. 41(B)(1) applies to

all dismissals with prejudice * * *. A dismissal on the merits is a harsh remedy that calls

for the due process guarantee of prior notice.” Ohio Furniture at 101. See also Klaus v.

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Related

State ex rel. Cincinnati Enquirer v. Ronan
2009 Ohio 5947 (Ohio Supreme Court, 2009)
State ex rel. Williams v. Trim (Slip Opinion)
2015 Ohio 3372 (Ohio Supreme Court, 2015)
Tarver v. IRS Dept.
2016 Ohio 3199 (Ohio Court of Appeals, 2016)
Mayrides v. Franklin County Prosecutor's Office
594 N.E.2d 48 (Ohio Court of Appeals, 1991)
Perotti v. Ferguson
454 N.E.2d 951 (Ohio Supreme Court, 1983)
Ohio Furniture Co. v. Mindala
488 N.E.2d 881 (Ohio Supreme Court, 1986)
State ex rel. Fogle v. Steiner
656 N.E.2d 1288 (Ohio Supreme Court, 1995)
State ex rel. Askew v. Goldhart
665 N.E.2d 200 (Ohio Supreme Court, 1996)
Perrysburg Township v. City of Rossford
103 Ohio St. 3d 79 (Ohio Supreme Court, 2004)

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Bluebook (online)
2023 Ohio 3275, 224 N.E.3d 674, Counsel Stack Legal Research, https://law.counselstack.com/opinion/live-joyfully-llc-v-pnc-bank-na-ohioctapp-2023.