[Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
COURT OF APPEALS DELAWARE COUNTY, OHIO FIFTH APPELLATE DISTRICT
PHAM CONSTRUCTION AND : JUDGES: COMPANY, LLC : : : Hon. W. Scott Gwin, P.J. Plaintiff-Appellant : Hon. Patricia A. Delaney, J. : Hon. Andrew J. King, J. -vs- : : Case No. 23 CAE 02 0018 : HUY D. TRAN, ET AL. : : : Defendants-Appellees : OPINION
CHARACTER OF PROCEEDING: Appeal from the Delaware County Court of Common Pleas, 21 CV H 06 0305
JUDGMENT: AFFIRMED
DATE OF JUDGMENT ENTRY: February 20, 2024
APPEARANCES:
For Plaintiff-Appellant: For Defendants-Appellees:
MICHAEL J. ANTHONY MICHAEL T. COX VINCENT P. ZUCCARO 4930 Reed Road, Suite 220 978 S. Front St. Columbus, OH 43220 Columbus, OH 43206 [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
Delaney, J.
{¶1} Plaintiff-Appellant Pham Construction and Company, LLC appeals the
December 14, 2022 and January 23, 2023 judgment entries of the Delaware County Court
of Common Pleas.
FACTS AND PROCEDURAL HISTORY
{¶2} Plaintiff-Appellant Pham Construction and Company, LLC (“PCC”) is a
limited liability company that specializes in interior buildouts for commercial clients.
Defendants-Appellees Huy D. Tran and Linh T. Quach are the co-owners of a business
known as Perfect 10 Nail Salon. Tran and Quach owned and operated Perfect 10 as a
general partnership (hereinafter “Perfect 10”). PCC and Perfect 10 entered into a contract
on April 18, 2018 for an expansion buildout of a leased commercial property located in
Delaware, Ohio.
Complaint, Counterclaim, and Pre-Trial Proceedings
{¶3} On June 28, 2021, PCC filed a complaint with the Delaware County Court
of Common Pleas naming Tran and Quach dba Perfect 10 as defendants. The complaint
alleged four causes of action: breach of contract, promissory estoppel, civil theft, and
fraud.1 While PCC acknowledged that Perfect 10 had made a first contracted payment of
$20,000 on August 29, 2018 and a second contracted payment of $38,722 on October
25, 2018, PCC claimed Perfect 10 failed to make a third contracted payment of $30,000.
PCC alleged that Perfect 10 breached the 2018 Contract when it refused to pay the
1 On July 19, 2022, the trial court granted summary judgment in favor of Perfect 10 on PCC’s claims for promissory estoppel and fraud. On October 10, 2022, the trial court granted a directed verdict in favor of Perfect 10 on PCC’s claim for civil damages for the criminal act of passing bad checks. PCC does not raise those judgments in its appeal. We will focus our recitation of the facts on the remaining causes of action at issue in the appeal. [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
remaining contractual balance of $39,858 and $14,470 for additional work not covered by
the 2018 Contract.
{¶4} Perfect 10 filed a motion to dismiss PCC’s claims for civil theft and fraud,
which the trial court denied on September 17, 2022. It also filed its answer to the complaint
and raised counterclaims for breach of contract, conversion, and civil theft based on the
authorized use of property and theft by deception pursuant to R.C. 2307.60 and 2307.61.
The breach of contract counterclaim alleged that PCC had breached the 2018 Contract
when it failed to complete the improvements to the property within the agreement’s five-
month deadline. Perfect 10 also alleged it had made a $30,000 payment and PCC refused
to credit that payment to Perfect 10’s balance under the 2018 Contract; thereby, Perfect
10 raised a counterclaim for civil damages for the criminal act of theft by deception.
{¶5} Perfect 10 filed a motion for summary judgment seeking judgment as a
matter of law on all of PCC’s causes of action. The trial court granted summary judgment
in favor of Perfect 10 on PCC’s claims for promissory estoppel and fraud. It denied
summary judgment on PCC’s claims for breach of contract and civil theft.
Jury Trial
{¶6} The matter proceeded to a jury trial on October 4, 2022. Prior to sending
the matter to the jury, the trial court granted directed verdicts on PCC’s claim for civil
damages for the criminal act of passing bad checks and Perfect 10’s counterclaims for
conversion and civil damages for the criminal act of unauthorized use of property. The
only claims for the jury to decide were PCC’s claim for breach of contract and Perfect 10’s
counterclaims for breach of contract and civil damages for the criminal act of theft by
deception. The following facts, relevant to this appeal, were adduced at trial. [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
{¶7} On April 18, 2018, Calvin Pham and Thanh Tam Nguyen (partners in Pham
Construction) entered into a contract with Huy Duc Tran for the buildout extension of the
Perfect 10 nail salon in the amount of $98,580. Pham, Nguyen, and Tran signed the 2018
Contract at the Chase Bank before a notary. At the time of the signing, PCC believed that
Perfect 10 was in the process of obtaining a loan from Chase Bank to pay for the
construction. Perfect 10 denied that it told PCC it had applied for a loan with Chase Bank;
rather, it had inquired into a loan and found the terms unacceptable. Article 1 of the 2018
Contract stated the work was divided into three phases, with the work to be completed in
five months. Article 4 of the 2018 Contract outlined the payments:
* * * the Owner shall make progress payments to the Contractor as follows:
1st Payment (50% of $98,580): OR must make this payment to PCC to start
the project.
2nd Payment (30% of $98,580): OR must make this payment to PCC after
the completion of PHASE 1 construction work.
3rd Payment (10% of $98,580): OR must make this payment to PCC after
the completion of PHASE 2 construction work.
4th Payment (Final Payment 10% of $98,580): OR must make this payment
to PCC within 7 days of receiving Certify of Opening from CITY OF
DELAWARE.
Article 15 of the 2018 Contract contained a provision if the Owner failed to make a
payment for a period of 7 days through no fault of the Contractor, the Contractor could,
upon 7 days written notice to the Owner, terminate the contract. PCC admitted that during
its dealings with Perfect 10, it did not always follow the terms of the 2018 Contract. [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
{¶8} On July 1, 2018, Tran gave PCC a check for $49,290. Tran told PCC to hold
the check and not cash it because he did not have the funds to cover the check. He never
told PCC to return the check to Perfect 10. PCC started the construction project a few
days later. On July 2, 2018, Tran testified that he gave Nguyen $30,000 as payment
towards the project ($20,000 in cash from Tran’s mother and a $10,000 money order from
Tran’s brother). Tran testified that he forgot to ask Nguyen for a receipt for the $30,000
payment. Tran’s mother and brother testified at the trial that they provided Tran with the
funds, and he had since paid them back.
{¶9} Prior to beginning the project, PCC informed Perfect 10 that it could work
with Perfect 10’s commercial landlord to receive funds towards the project as a Tenant
Allowance. Perfect 10’s landlord offered $41,000 towards the project for a HVAC system
and demising wall, and 150 days of free rent.
{¶10} PCC completed Phase 1 of the project in August 2018. On August 29, 2018,
the parties agree that Tran gave PCC $20,000 as payment towards the project (a $15,000
check and $5000 in cash). PCC provided Tran with a receipt for the $20,000 payment.
Tran testified that on August 29, 2018, he also asked PCC for a receipt for the $30,000
payment made by him in July 2018. He stated that PCC provided him with a receipt for
the $30,000 payment but Pham testified the August 29, 2018 receipt showing a $30,000
payment was a forgery. Pham testified that he did not keep for his own records the copies
of the receipts he provided to his customers.
{¶11} Phase 2 of the project was completed in October 2018. PCC texted with
Perfect 10 and demanded payment. In one text, PCC stated it had received a first
payment of $50,000, which covered the first payment and partial second payment. When [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
it did not receive a timely payment, PCC stopped work on the project. Pham testified that
while the 2018 Contract contained provisions for non-payment, Pham did not want to
waste time writing a letter and was not obligated to follow the terms of the contract. On
October 25, 2018, Perfect 10 paid PCC $38,722 via wire transfer.
{¶12} The City of Delaware issued a Certificate of Occupancy for the project on
March 5, 2019. Tran testified that the expanded nail salon space was supposed to open
in November 2018 under the terms of the 2018 Contract. While Perfect 10’s landlord
provided it with 150 days of free rent as part of the Tenant Allowance, because the project
took longer than five months, Perfect 10 was required to pay rent for the expanded leased
space even though the business was not open. Perfect 10 argued that it had paid PCC
$88,722 and admitted at trial that it still owed PCC $9,858 under the final payment
provision of the 2018 Contract.
{¶13} On February 20, 2019, PCC submitted an invoice to Perfect 10 for
additional work outside the contract in the amount of $14,470 that included $5,600 for
additional tile installation, $4,200 for ceiling painting, and $4,670 for installing a tankless
water heater. Perfect 10’s landlord communicated with PCC for a status update on the
project and PCC responded that it had never received a $30,000 payment from Perfect
10. Pham testified that when the landlord responded with an emailed copy of a receipt for
the $30,000 payment from Perfect 10, this was the first time he became aware of the
alleged receipt and/or payment for $30,000. On February 6, 2020, Perfect 10’s landlord
paid Perfect 10 in the amount of $37,955 for the Tenant Allowance. When PCC became
aware that Perfect 10 had been paid the Tenant Allowance, PCC cashed Perfect 10’s
check for $49,290. The check did not clear. [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
{¶14} At the conclusion of the parties’ cases, the parties moved for directed
verdicts. The trial court granted Perfect 10’s motion for directed verdict on PCC’s claim
for civil damages for the criminal act of passing bad checks. PCC moved for a directed
verdict on Perfect 10’s counterclaims, which the trial court granted as to conversion and
civil damages for the criminal act of unauthorized use of property. The only claims sent
to the jury were PCC’s claim for breach of contract and Perfect 10’s counterclaims for
breach of contract and civil damages for the criminal act of theft by deception.
{¶15} The parties discussed the jury instructions and made their objections to the
instructions on the record. Perfect 10 had no objection to the jury instructions. PCC raised
only one objection to the instruction for the jury to treble the damages if it found PCC
liable for the criminal act of theft. The trial court overruled the objection.
{¶16} On the issue of Perfect 10’s breach of contract claim, the trial court
instructed the jury as to the measure of damages. The trial court stated,
If you find by a preponderance of the evidence that Mr. Tran and Ms. Quach
proved their counterclaim for breach of contract, you must determine
whether Mr. Tran and Ms. Quach suffered any damages as a result of the
breach. If you find that they have suffered damages, they are entitled to
damages in an amount sufficient to place them in the same position in which
they would have been in had the contract been fully performed by Pham
Construction, so long as the damages are reasonably certain and
reasonably foreseeable.
For either claim of breach of contract, you may only award damages the
existence and the amount of which are reasonably certain and which have [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
been proved to you by the greater weight of the evidence. You may not
award damages that are remote are [sic] speculative.
You may award only those damages that were the natural and probable
result of the breach of the contract or that were reasonably within the
contemplation of the parties as the probable result of the breach of the
contract. This does not require that the breaching party actually be aware
of the damages that would probably result from the breach of contract, so
long as the damages were reasonably foreseeable at the time the parties
entered into the contract.
(T. 607-608).
{¶17} The jury was provided with multiple interrogatories. In Jury Interrogatory
(“JI”) #1A and #9, the jury found there was a contract between PCC and Perfect 10 to
construct improvements to Perfect 10 nail salon. In JI #1B, the jury found there was a
contract between PCC and Perfect 10 for additional construction work to Perfect 10 nail
salon. In JI #2, the jury found that Perfect 10 breached the contract by failing to pay PCC
for construction of the improvements to the nail salon. In JI #3, the jury found that PCC
proved by a preponderance of the evidence that, at the time of the breach, it had
substantially performed its duties under the contract(s). In JI #4, the jury found that PCC
was entitled to $15,458 in damages for its claim of breach of contract. The jury wrote
“$9858.00 10%” and “$5600.00 Tile Installation” on the interrogatory.
{¶18} In JI #10, the jury found that Perfect 10 proved by a preponderance of the
evidence that PCC materially breached the contract. In JI #11, the jury found that Perfect
10 substantially performed its duties under the contract. JI #12 asked the jury what [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
amount it found that Perfect 10 was damaged as a natural and probable result of PCC’s
breach of contract, or what damages were reasonably within the contemplation of the
parties as the probable result of PCC’s breach. It further stated that Perfect 10 was
entitled to damages in an amount sufficient to place them in the same position that they
would have been in had the contract been fully performed. The jury awarded Perfect 10
$18,201.96 and wrote “4 months rent” next to the award.
{¶19} As to Perfect 10’s counterclaim for civil damages for a criminal act (theft),
the jury found in JI #13 and #14 that PCC knowingly obtained or exerted control over a
payment of $30,000, which was not credited to Perfect 10’s account and that PCC acted
with purpose to deprive Perfect 10 of the $30,000 payment when PCC obtained or exerted
control over the payment by accepting the payment and not crediting it to Perfect 10’s
account. In JI #15, the jury found that PCC obtained or exerted control over the $30,000
payment by deception. JI #16 asked the jury to write a number that was three times the
amount of damages that it found were caused to Perfect 10 by the criminal act of theft by
PCC. The jury awarded Perfect 10 the amount of $0.33 in damages, which was trebled
per statute to $1.00. In JI #17A, the jury found Perfect 10 was entitled to punitive damages
and awarded $27,302.94 in punitive damages. The jury found PCC should pay the
attorney fees for Perfect 10 in JI #17B.
{¶20} On October 10, 2022, the trial court journalized the jury verdict.
Post-Trial Proceedings
{¶21} On November 1, 2022, PCC filed a Motion for Judgment Notwithstanding
the Verdict and a Motion for Remittitur, or in the alternative, for a New Trial. On November [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
7, 2022, Perfect 10 filed a Motion for Judgment Notwithstanding the Verdict, or in the
alternative, Additur, or in the alternative, for New Trial.
{¶22} A hearing on attorney’s fees was held before the magistrate on November
28, 2022. The magistrate awarded attorney’s fees and costs in the amount of $48,658.96
to Perfect 10. The parties filed objections to the magistrate’s decision.
{¶23} On December 14, 2022, the trial court issued its judgment entry on the
parties’ motions for JNOV, remittitur, additur, and new trial. The only subject of this appeal
is whether the trial court erred when it granted Perfect 10’s motion for JNOV in part and
denied PCC’s motion for JNOV in part. We focus on those issues discussed in the trial
court’s December 14, 2022 judgment entry. The trial court first addressed Perfect 10’s
post-trial motions. Perfect 10 sought judgment on the issue of damages for its
counterclaim for civil theft whereby it requested the trial court to increase damages to the
full value of the $30,000 payment, which would be trebled to $90,000. In the alternative,
Perfect 10 requested it be awarded the statutory minimum of $200. The trial court found
that pursuant to R.C. 2307.61(A), Perfect 10 was entitled to the statutory minimum of
$200 in damages as a matter of law for its civil theft counterclaim.
{¶24} The trial court next addressed PCC’s arguments. PCC argued it was
entitled to JNOV on Perfect 10’s counterclaim for civil theft because Perfect 10 could not
recover compensatory damages for civil theft under the economic loss doctrine. PCC
argued that Perfect 10’s damages sounded in contract, not in tort. PCC pointed to the
jury’s damages award for $15,458 on its claim for breach of contract, which demonstrated
that Perfect 10’s harm from PCC’s theft of the $30,000 payment was the result of the
conduct governed by the 2018 Contract. Relying on this Court’s decision in Windsor [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
Medical Center, Inc. v. Time Warner Cable, Inc., 2021-Ohio-158, 167 N.E.3d 23 (5th
Dist.), the trial court found that while Perfect 10 owed $30,000 under the 2018 Contract,
the jury found that PCC engaged in a separate tortious act of theft by deception in regard
to the $30,000 payment whereby the jury awarded damages for the harm caused by the
deceptive conduct. The trial court then agreed with PCC to reduce Perfect 10’s punitive
damage award to $400 to comply with R.C. 2315.21. Finally, the trial court found the jury
correctly calculated Perfect 10’s damages on its breach of contract counterclaim. PCC
contended the jury used the incorrect measure of damages when it awarded Perfect 10
damages for $18,201.96, which was the equivalent of four months’ rent. PCC argued the
jury used “loss of use” damages. The trial court found that however the damages were
characterized, the 2018 Contract included terms specifying the duration of the
construction and the evidence demonstrated the construction was finished after that
agreed upon term. The jury had sufficient evidence to conclude the parties contemplated
the damages caused by PCC’s delay.
{¶25} On January 23, 2023, the trial court issued its judgment on the issue of
attorney’s fees. It overruled the parties’ objections to the December 8, 2022 magistrate’s
decision and adopted the award of $48,658.96 in attorney’s fees and costs to Perfect 10.
{¶26} PCC filed its Notice of Appeal of the trial court’s judgments on February 21,
2023.
ASSIGNMENTS OF ERROR
{¶27} PCC raises two Assignments of Error:
I. THE TRIAL COURT ERRED IN DENYING PLAINTIFF-APPELLANT’S
MOTION FOR JUDGMENT NOTWITHSTANDING THE VERDICT AS TO [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
THE JURY VERDICT AWARDING DEFENDANT-APPELLEE DAMAGES
FOR CIVIL THEFT, PUNITIVE DAMAGES, AND ATTORNEY’S FEES.
II. THE TRIAL COURT ERRED IN DENYING PLAINTIFF-APPELLANT’S
MOTION FOR JUDGMENT NOTWITHSTANDING THE VERDICT AS TO
FOR BREACH OF CONTRACT.
ANALYSIS
{¶28} PCC argues the trial court erred when it denied in part its motion for JNOV.2
For the reasons outlined below, we disagree.
Standard of Review
{¶29} Civil Rule 50(B) governs motions for judgment notwithstanding the verdict
(“JNOV”). When ruling on a motion for JNOV, a trial court applies the same test as in
reviewing a motion for a directed verdict. Windsor Med. Ctr., Inc. v. Time Warner Cable,
Inc., 2021-Ohio-158, 167 N.E.3d 23, ¶ 23 (5th Dist.) citing Ronske v. Heil Co., 5th Dist.
Stark No. 2006-CA-00168, 2007-Ohio-5417; Pariseau v. Wedge Products, Inc., 36 Ohio
St.3d 124, 522 N.E.2d 511 (1988). In reviewing a motion for JNOV, courts do not consider
the weight of the evidence or the witness credibility; rather, courts consider the much
narrower legal question of whether sufficient evidence exists to support the verdict. Texler
v. D.O. Summers Cleaners & Shirt Laundry Co., 81 Ohio St.3d 677, 693 N.E.2d 271
(1998). In other words, if there is evidence to support the nonmoving party's side so that
reasonable minds could reach different conclusions, the court may not usurp the jury's
2 While PCC states in its notice of appeal that it is appealing the January 23, 2023 judgment entry that determined the amount of attorney’s fees to be awarded, PCC has not raised any assignment of error as to the trial court’s determination of the amount of attorney’s fees. [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
function and the motion must be denied. Osler v. City of Lorain, 28 Ohio St.3d 345, 504
N.E.2d 19 (1986). Appellate review of a ruling on a motion for JNOV is de novo. Meredith
v. All. Castings Co., LLC, 5th Dist. Stark No. 2020 CA 00143, 2021-Ohio-2565, ¶ 10 citing
Midwest Energy Consultants, L.L.C. v. Utility Pipeline, Ltd., 5th Dist. Stark No.
2006CA00048, 2006-Ohio-6232.
I.
{¶30} In its first Assignment of Error, PCC argues the trial court erred in its
determination as to Perfect 10’s counterclaims for civil theft, punitive damages, and
attorney’s fees.
{¶31} Perfect 10 brought its counterclaim for civil theft based on R.C.
2307.60(A)(1), which states, “[a]nyone injured in person or property by a criminal act has,
and may recover full damages in, a civil action unless specifically excepted by law, may
recover the costs of maintaining the civil action and attorney's fees if authorized by any
provision of the Rules of Civil Procedure or another section of the Revised Code or under
the common law of this state, and may recover punitive or exemplary damages if
authorized by section 2315.21 or another section of the Revised Code.” Perfect 10
alleged that it suffered damages that were proximately caused by PCC’s deceptive
conduct as to the crime of theft of the $30,000 payment that was not credited to their
account. The jury concluded the greater weight of the evidence demonstrated that PCC
engaged in theft as to the $30,000 payment.
{¶32} The trial court instructed the jury pursuant to R.C. 2307.61(A)(1)(b)(ii) as to
the measure of damages on the counterclaim for civil theft: [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
(A) If a property owner brings a civil action pursuant to division (A) of section
2307.60 of the Revised Code to recover damages from any person who
willfully damages the owner's property or who commits a theft offense, as
defined in section 2913.01 of the Revised Code, involving the owner's
property, the property owner may recover as follows:
(1) In the civil action, the property owner may elect to recover moneys as
described in division (A)(1)(a) or (b) of this section:
***
(b) Liquidated damages in whichever of the following amounts is greater:
(i) Two hundred dollars;
(ii) Three times the value of the property at the time it was willfully damaged
or was the subject of a theft offense, irrespective of whether the property is
recovered by way of replevin or otherwise, is destroyed or otherwise
damaged, is modified or otherwise altered, or is resalable at its full market
price. This division does not apply to a check, negotiable order of
withdrawal, share draft, or other negotiable instrument that was returned or
dishonored for insufficient funds by a financial institution if the check,
negotiable order of withdrawal, share draft, or other negotiable instrument
was presented by an individual borrower to a licensee under sections
1321.35 to 1321.48 of the Revised Code for a loan transaction.
The jury awarded Perfect 10 the amount of $1.00, which was three times $0.33.
{¶33} In its motion for JNOV, PCC argued the jury’s award of $1.00 for the
counterclaim of civil theft was barred because the jury credited the $30,000 payment [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
Perfect 10 claimed was stolen against PCC’s award of damages on its breach of contract
claim. In arguing so, PCC provided the trial court with its interpretation of the jury’s award
of damages. The parties agreed Perfect 10 contracted to pay PCC $98,580 under the
2018 Contract. The jury found Perfect 10 owed PCC for additional work in the amount of
$5,600 and a final payment of $9,858 and awarded PCC $15,458 on its breach of contract
claim. PCC argued the jury’s award under its claim for breach of contract equaled the
following:
2018 Contract $98,580 Additional Tile Work + 5,600 Payment - 30,000 Payment - 20,000 Payment - 38,722 Jury Award $15,458
The jury then found PCC liable for civil theft of the $30,000 payment and awarded Perfect
10 statutory damages. PCC contends the jury provided Perfect 10 with a double recovery
by crediting it $30,000 on PCC’s breach of contract claim and awarding Perfect 10
damages on its counterclaim for civil theft. Upon our de novo review, we conclude the
trial court did not err in overruling PCC’s motion for JNOV on this issue.
{¶34} In Ohio, the existence of a contract action generally excludes the
opportunity to present the same case as a tort claim. Textron Fin. Corp. v. Nationwide
Mut. Ins. Co., 115 Ohio App.3d 137, 151, 684 N.E.2d 1261, 1270 (9th Dist.1996). “A tort
claim based upon the same actions as those upon which a claim of contract breach is
based will exist independently of the contract action only if the breaching party also
breaches a duty owed separately from that created by the contract, that is, a duty owed
even if no contract existed.” Id. PCC contends that Perfect 10’s civil theft counterclaim [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
must fail as a tort because its essence is derived from contract. See STE Investments,
LLC v. Macprep, Ltd., 6th Dist. Ottawa No. OT-21-036, 2022-Ohio-2614, ¶ 42. According
to PCC, the jury’s “credit” of the $30,000 payment in its determination of damages for its
breach of contract claim demonstrates that Perfect 10’s damages from the alleged theft
of the $30,000 payment were the result of conduct governed by the 2018 contract and
not an independent tort.
{¶35} In support of its argument, PCC cites STE Investments LLC v. Macprep,
Ltd., 6th Dist. Ottawa No. OT-21-036, 2022-Ohio-2614. In STE Investments, the Sixth
District Court of Appeals found that a property management group could not be liable for
a claim of civil theft brought by the condominium owners. The condominium owners filed
suit and brought claims of conversion, civil theft, and racketeering based on the property
management group’s alleged misuse and improper allocation of funds. The condominium
owner’s claim for civil theft stated as follows:
89. Revised Code Section 2307.60(A)(1) clearly states that any person who
has been injured by criminal act may bring a civil action for the recovery of
damages. Such damages include punitive or exemplary damages.
90. That individual and entity Defendants through a pattern of collusion,
fraudulent conduct, and intentional behavior did deprive the Plaintiffs of
money and use of their property which constitutes theft and embezzlement
under the Ohio Revised Code.
91. The Plaintiffs have been damaged financially in amounts to be
determined at trial for the inappropriate expenses and diversion of funds as [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
set forth above as well as by way of the deprived use of their property and
value associated therewith.
Id. at ¶ 39.
{¶36} The Sixth District affirmed the trial court’s judgment to dismiss the claim for
civil theft under Civ.R. 12(B)(6). It found the relationship between the property
management group and condominium owners was regulated by condominium
declarations and bylaws. Id. at ¶ 6. R.C. 2307.60(B)(1)(a) defines a “tort action” as “a civil
action for damages for injury, death, or loss to person or property other than a civil action
for damages for a breach of contract or another agreement between persons.” The court
found the claim for civil theft essentially alleged mismanagement and improper
assessments that breached the terms of the condominium declarations and bylaws,
therefore a claim for civil theft would not lie. Id. at ¶ 42.
{¶37} PCC’s reliance on STE Investments intertwines with its argument that the
economic loss doctrine precludes Perfect 10’s recovery for civil theft. We examine our
decision in Windsor Medical Center, Inc. v. Time Warner Cable, Inc., 2021-Ohio-158, 167
N.E.3d 23 (5th Dist.), which thoroughly discusses the economic loss doctrine.
{¶38} In that case, Windsor Medical, a skilled nursing and senior living center,
brought an action against Time Warner Cable, nka Spectrum, which by a contractual
agreement provided the facility's telephone, internet, and cable service. Id. at ¶ 2. Despite
reassurances from Spectrum that Windsor Medical would not have international calling
capabilities under the contract, Spectrum billed Windsor Medical for international calls.
Spectrum acknowledged the error and offered a partial credit for the billing error.
Spectrum, however, did not correct the billing error, did not give Windsor Medical the [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
credit, sent the matter to collections, and threatened to disconnect the phone service if
the disputed charge was not paid. Id. at ¶ 30. Windsor Medical paid the charges to
maintain phone service. Spectrum then offered Windsor Medical an opportunity to replace
its internet service with a better internet speed at a lower rate. Windsor Medical signed a
new internet contract and Spectrum agreed to disconnect the old service, but Spectrum
never disconnected the old service. It proceeded to bill Windsor Medical for the old service
and the new service. Windsor Medical repeatedly notified Spectrum of the error, which
Spectrum stated it would resolve. Spectrum did not resolve the error, continued to double-
bill Windsor Medical, sent the matter to collectors, and disconnected Windsor Medical’s
phone system due to non-payment. Id. at ¶ 31-34. Windsor Medical paid the disputed
charges to restore its phone service.
{¶39} Windsor Medical sought damages for fraud and violations of Ohio's
Deceptive Trade Practices Act. Id. at ¶ 4. The jury found in favor of Windsor Medical on
the fraud claim and awarded compensatory and punitive damages. Id. at ¶ 19. The jury
found in favor of Spectrum on Windsor Medical's claim for deceptive trade practices. Id.
Spectrum filed a motion for judgment notwithstanding the verdict, which the trial court
denied. Id. at ¶ 20.
{¶40} On appeal, Spectrum argued the economic loss rule barred Windsor
Medical's fraud claim as such claim sounded in contract. Id. at ¶ 24. We disagreed,
finding:
There are exceptions, however, to the application of the economic loss rule
to bar recovery in tort of purely economic loss. A plaintiff may pursue such
a tort claim if it is “based exclusively upon [a] discrete, preexisting duty in [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
tort and not upon any terms of a contract or rights accompanying privity.”
Corporex [Dev. & Constr. Mgt., Inc. v. Shook, Inc., 106 Ohio St.3d 412,
2005-Ohio-5409, 835 N.E.2d 701] supra at ¶ 9. These types of exempt
claims may include negligent misrepresentation, breach of fiduciary duty,
fraud, and conversion. Potts v. Safeco Ins. Co., 5th Dist. No. 2009 CA 0083,
2010-Ohio-2042, 2010 WL 1839738, ¶ 21; Morgan v. Mikhail, 10th Dist. No.
08AP-87, 2008-Ohio-4598, 2008 WL 4174063, ¶ 69.
Therefore, a tort claim can proceed where “the facts of the case show an
intentional tort committed independently, but in connection with a breach of
contract * * *.” Burns v. Prudential Securities, Inc., 167 Ohio App.3d 809,
2006-Ohio-3550, 857 N.E.2d 621, ¶ 99. Accordingly, where a tort claim
alleges a duty was breached independent of the contract, the economic loss
rule does not apply. See, Campbell v. Krupp, 195 Ohio App.3d 573, 2011-
Ohio-2694, 961 N.E.2d 205, ¶ 16 (6th Dist.) See also, Eysoldt v. ProScan
Imaging, 194 Ohio App.3d 630, 2011-Ohio-2359, 957 N.E.2d 780, ¶21 (1st
Dist.) (finding the economic loss rule does not apply to intentional torts, as
they are breaches of duties beyond those created by contract). Where the
tort claim alleges a breach of an independent duty, it must also allege
damages that are separate and distinct from the breach of contract.
Strategy Group for Media, Inc. v. Lowden, 5th Dist. Delaware No. 12 CAE
03 0016, 2013-Ohio-1330, 2013 WL 1343614, ¶ 30.
Id. at ¶ 27-28 [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
{¶41} In accordance with our decision in Windsor Medical, we find the economic
loss rule does not apply to bar Perfect 10’s counterclaim for civil theft of the $30,000
payment. We likewise find STE Investments to be unpersuasive under the facts of the
present case. Pursuant to the 2018 Contract, Perfect 10 was to pay PCC for the
construction of improvements on the nail salon. The evidence presented at trial, however,
demonstrated that as to the $30,000 payment, there was sufficient evidence to support
that PCC engaged in deceptive conduct independent of the parties’ obligations under the
2018 Contract. Tran testified he made the $30,000 payment on July 2, 2018 but forgot to
ask for a receipt. On August 29, 2018, when Tran made the $20,000 payment, he asked
for a receipt for the $20,000 payment and the previous $30,000 payment. At trial, Perfect
10 presented receipts for a $20,000 payment and $30,000, both dated August 29, 2018.
Pham testified that he did not keep copies of his own receipts. He stated the August 29,
2018 receipt for $30,000 was a forgery. Nguyen was presented with a text he sent to Tran
on October 22, 2018 that stated PCC received the first payment of $50,000, which only
covered the first payment and partial second payment. Nguyen testified he was referring
to the check for $49,000 and the $20,000 payment.
{¶42} While there was a contract between PCC and Perfect 10, the damages
alleged by Perfect 10 based on the $30,000 payment were separate and distinct from the
damages caused by the breach of contract. There was sufficient evidence to support the
jury’s verdict and accordingly, we find the trial court did not err in denying PCC’s motion
for JNOV on Perfect 10’s counterclaim for civil theft. [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
{¶43} Because we find that Perfect 10’s counterclaim for civil theft survives, we
overrule PCC’s argument on appeal that the related award of punitive damages and
attorney’s fees must fail.
{¶44} PCC’s first Assignment of Error is overruled.
II.
{¶45} In its second Assignment of Error, PCC contends the trial court erred when
it denied its motion for JNOV as to the jury’s award of damages to Perfect 10 for its
counterclaim of breach of contract. PCC argues the evidence presented at trial was
insufficient to establish the measure of damages awarded by the jury. We disagree.
{¶46} PCC characterizes the jury’s measure of damages as “loss of use,” which it
contends is the improper measure of damages in a breach of contract claim. The loss of
use measure of damages is used to calculate damages for injury to real property. See
Pingue v. Preferred Real Estate Invests II, LLC, 5th Dist. Delaware No. 15 CAE 01 0008,
2015-Ohio-4751, ¶ 61. “ ‘[T]he general measure of damages in a contract action is the
amount necessary to place the nonbreaching party in the position he or she would have
been in had the breaching party fully performed under the contract.’ ” Westfield Ins. Group
v. Silco Fire & Sec., 5th Dist. Stark No. 2018CA00122, 2019-Ohio-2779, ¶ 63 quoting
Williams v. Williams, 5th Dist. Morrow No. 2010-CA-0006, 2011-Ohio-1200, ¶ 21 quoting
Allied Erecting & Dismantling Co., Inc. v. Youngstown, 151 Ohio App.3d 16, 31–32, 783
N.E.2d 523 (7th Dist.2002), citing F. Enterprises, Inc. v. Kentucky Fried Chicken Corp.,
47 Ohio St.2d 154, 159, 351 N.E.2d 121 (1976). PCC argues that in this breach of contract
counterclaim, lost profits were the proper measure of damages. We note that PCC did [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
not object to the trial court’s jury instructions as to the measure of damages for a claim of
breach of contract.
{¶47} The terms of the 2018 Contract stated PCC would complete the
construction improvements in five months, which Perfect 10 testified would have been
November 2018. The evidence showed that construction took nine months to complete,
and a certificate of occupancy was issued in March 2019. When PCC did not receive a
timely payment from Perfect 10, PCC stopped work on the project. Pham testified that
while the 2018 Contract contained provisions for non-payment, Pham did not want to
waste time writing a letter and was not obligated to follow the terms of the contract.
Evidence was presented that after the 150 days of free rent, Perfect 10 was required to
pay its monthly rent for the expanded space but was unable to utilize the space because
the construction was not completed. On Perfect 10’s counterclaim for breach of contract,
the jury awarded Perfect 10 the amount of $18,201.96 and wrote “4 months rent” next to
the award on the jury interrogatory.
{¶48} A JNOV may be granted only where the evidence is totally insufficient to
support the verdict. Central Ohio Medical Textiles v. PSC Metals, Inc., 10th Dist. Franklin
No. 19AP-167, 2020-Ohio-591, ¶ 30 citing Harper v. Lefkowitz, 10th Dist. Franklin Nos.
09AP-1090, 09AP-1116, 2010-Ohio-6527, ¶ 8 citing McLeod v. Mt. Sinai Med. Ctr., 166
Ohio App.3d 647, 852 N.E.2d 1235, 2006–Ohio–2206, reversed on other grounds, 116
Ohio St.3d 139, 876 N.E.2d 1201. The jury was instructed on the measure of damages
for Perfect 10’s counterclaim for breach of contract: “If you find that they have suffered
damages, they are entitled to damages in an amount sufficient to place them in the same
position in which they would have been in had the contract been fully performed by Pham [Cite as Pham Construction & Co., L.L.C. v. Tran, 2024-Ohio-634.]
Construction, so long as the damages are reasonably certain and reasonably
foreseeable.” Based on the terms of the 2018 Contract, evidence of the breach of the
contract, and the jury instructions as to the measure of damages for breach of contract,
there was sufficient evidence to support the jury’s damage calculation and that calculation
should not be disturbed.
{¶49} PCC’s second Assignment of Error is overruled.
CONCLUSION
{¶50} The judgment of the Delaware County Court of Common Pleas is affirmed.
By: Delaney, J.,
Gwin, P.J. and
King, J., concur.