Patel v. Strategic Group, L.L.C.

2020 Ohio 4990, 161 N.E.3d 42
Ohio Court of Appeals·Decided October 22, 2020·No. 109043·Published·Cited by 17 cases

Opinion

COURT OF APPEALS OF OHIO

EIGHTH APPELLATE DISTRICT COUNTY OF CUYAHOGA

BIPIN PATEL, :

Plaintiff-Appellee, :

No. 109043

v. :

STRATEGIC GROUP, L.L.C., :

Defendant-Appellant. :

JOURNAL ENTRY AND OPINION

JUDGMENT: AFFIRMED IN PART AND VACATED IN PART RELEASED AND JOURNALIZED: October 22, 2020

Civil Appeal from the Cuyahoga County Court of Common Pleas Case No. CV-18-897461

Appearances:

Kenneth J. Fisher, Co., L.P.A., Kenneth J. Fisher, and Dennis A. Nevar, for appellee.

The Law Office of Jaye M. Schlachet, Eric M. Levy, and Jaye M. Schlachet, for appellant.

RAYMOND C. HEADEN, J.:

Defendant-appellant Strategic Group, L.L.C. (“Strategic Group”)

appeals the trial court’s order entering judgment in favor of plaintiff-appellee Bipin

Patel (“Patel”) and against Strategic Group on Patel’s claims of breach of contract and conversion, with an award of damages in the amount of $50,000. For the reasons that follow, we affirm in part and vacate in part. I. Factual and Procedural History On February 13, 2018, Strategic Group purchased the commercial real estate located at 1877 Triplett Boulevard, Akron, Ohio for $95,000 (“real property”). Strategic Group then advertised the real property for sale through the online website BizBuySell.

Patel, a resident of Alabama, communicated several times with Shadi Taha (“Taha”), a co-manager of Strategic Group, to discuss the real property. On March 5, 2018, Taha indicated via text message that the convenience store located on the real property had been subject to a lease agreement. According to Patel, Taha advised him that the underlying lease agreement was expiring, and Patel could either renew the lease or opt to run the convenience store on his own. Taha’s text message read “renew the lease or take over!!!” Patel’s intent was to purchase the real property and to personally operate the convenience store — he did not want the convenience store subject to an underlying lease agreement.

Taha provided differing testimony. Taha claimed he informed Patel the lease agreement was in place with a few years remaining on the underlying lease. Per Taha, Patel asked if Strategic Group would negotiate with the current tenant and attempt to terminate the lease agreement. Taha notified Patel that Strategic Group would not attempt such negotiations, but Patel could pursue those options once he owned the real property.

Patel, along with three other individuals, traveled to Ohio to inspect the real property in early March 2018. On March 10, 2018 (“the March meeting”), Patel and his associates met Taha at a local Starbucks. Patel had not retained an attorney at that point in time.

The parties provided contrary testimony regarding the documents exchanged at the March meeting. Patel denied that Taha provided him with a purchase agreement or lease agreement at that time. Patel claimed he first received copies of the purchase agreement and lease agreement, by email, following the March meeting. Conversely, Taha stated he presented the proposed purchase agreement — that represented the sale of the real property from Strategic Group to Patel for the sum of $550,000 — as well as a copy of the underlying lease at the March meeting. Taha testified that Patel and his associates examined the documents for approximately one hour.

All parties agree that the purchase agreement noted Patel’s remittance of $50,000 earnest money. Patel paid the earnest money at the March meeting with three personal checks. Patel’s father and two of Patel’s friends each provided a check; the checks were made payable to Strategic Group. Strategic Group did not place the earnest money in escrow, as required under the purchase agreement, but deposited the funds in its personal bank account.

Patel provided conflicting testimony as to why he submitted the earnest money at the March meeting, prior to execution of the purchase agreement. Patel first testified that Taha required payment of the earnest money before he executed the purchase agreement. Patel later conceded he was anxious to purchase the real property and informed Taha that he would pay the earnest money and subsequently have the documents reviewed by his attorney.

Patel and Taha did not meet again following the March meeting, but exchanged copies of the relevant documents by email. While Taha asserted he provided the purchase agreement and lease agreement at the March meeting, Patel claimed receipt of the purchase agreement on March 11, 2018, and a partial lease on March 12, 2018. The partial lease agreement did not contain the pages that would have shown the lessee agreed to the available options, thereby committing to a lease extension until November 2020.

According to Taha, he provided Patel with duplicate copies of the lease on March 13, 2018, and March 20, 2018, and Patel should have known the real property was subject to the underlying lease. The entire lease agreement was over 70 pages and Taha admitted he never read the document in full. Patel maintained he did not receive the entire lease agreement until after his receipt of the title commitment.

The parties negotiated the purchase agreement by adding to the existing, printed paragraphs with hand-written language that was initialed by both buyer and seller. The document was executed on March 13, 2018. Taha then contacted Barristers Title of Ohio (“Barristers”) on March 14, 2018, to complete the title work associated with the purchase agreement.

Patel received a copy of the title commitment from Barristers on March 19, 2018. The title commitment included a handwritten notation that the buyer and seller — Patel and Strategic Group — would handle the assignment of the lease outside of escrow. This was Patel’s first notice that the underlying lease agreement was not expired.

Upon receipt of the title commitment, Patel provided his attorney, Christian Pereyda (“Pereyda”), with the documents relative to the purchase agreement. Pereyda penned a letter to Strategic Group, on Patel’s behalf, stating Patel would not go forward with the contract because the property was not satisfactory for its intended purpose. The letter requested the return of Patel’s earnest money. Patel may also have contacted Strategic Group directly and indicated that because the lease was not expired, he was terminating the agreement and requested the return of his earnest money.

Taha asserted that he was contacted by Patel after March 19, 2018, and asked to renegotiate the purchase agreement for a lower selling price. Patel conceded he attempted to negotiate a lower price after Taha refused to return the earnest money, but the parties did not agree upon alternate terms.

Patel insisted he terminated the purchase agreement as permitted by the document’s express terms and demanded repayment of his $50,000 earnest money. Strategic Group refused to accept Patel’s termination notice and, instead, argued it was entitled to the earnest money because Patel breached the contract when he failed to complete the purchase of the real property.

Due to Strategic Group’s refusal to return the earnest money, Patel filed suit against Strategic Group on May 5, 2018, claiming breach of contract, conversion, fraudulent misrepresentation, negligent misrepresentation, and fraudulent inducement. Strategic Group filed an answer on June 7, 2018. Strategic Group and Patel filed motions for summary judgment on January 23, 2019, and March 21, 2019, respectively. The trial court denied both summary judgment motions on June 4, 2019.

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Patel v. Strategic Group, L.L.C., 2020 Ohio 4990, 161 N.E.3d 42 (Ohio Ct. App. 2020).

2020 Ohio 4990 (Patel v. Strategic Group, L.L.C.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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