Pottschmidt v. Thomas J. Klosterman, M.D., Inc.

865 N.E.2d 111, 169 Ohio App. 3d 824, 2006 Ohio 6964, 2006 WL 3825206
CourtOhio Court of Appeals
DecidedDecember 29, 2006
DocketNo. 06CA0041-M.
StatusPublished
Cited by22 cases

This text of 865 N.E.2d 111 (Pottschmidt v. Thomas J. Klosterman, M.D., Inc.) 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
Pottschmidt v. Thomas J. Klosterman, M.D., Inc., 865 N.E.2d 111, 169 Ohio App. 3d 824, 2006 Ohio 6964, 2006 WL 3825206 (Ohio Ct. App. 2006).

Opinions

Moore, Judge.

{¶ 1} Appellants, Thomas J. Klosterman, M.D., Inc., Thomas J. Klosterman, M.D., and Klosterman Family Practice, Inc. (collectively “appellants”) appeal the judgment of the Medina County Court of Common Pleas in favor of appellee, Steven A. Pottschmidt, M.D. We affirm.

I

2} In the spring of 2001, appellee, Steven A. Pottschmidt (“Dr. Pottschmidt”) joined the family medical practice of appellant, Thomas J. Klosterman, M.D., Inc. (“original corporation”), a subchapter S corporation, of which appellant, Thomas J. Klosterman, M.D. (“Dr. Klosterman”), was the sole shareholder. Dr. Pottschmidt and the original corporation entered into an employment agreement with a term of one year on June 4, 2001 (“employment agreement”). The employment agreement was amended three times thereafter. The first amendment was on May 3, 2002, and served to extend the term of Dr. Pottschmidt’s employment through December 2002. The second amendment was on January 28, 2003, extended the term of Dr. Pottschmidt’s employment through June 30, 2003, and added a five percent management fee to the expense calculation in the employment agreement. The final amendment was dated September 16, 2003, and served to extend the term of the employment agreement until June 30, 2004. This amendment referred to a potential buy-in agreement and required Dr. Pottschmidt to provide written notice of termination of the contract depending on the number of months remaining on the employment agreement, as amended.

{¶ 3} Around the same time the employment agreement was signed, Dr. Pottschmidt entered into a salary guarantee agreement with Medina General Hospital, which contract supplemented Dr. Pottschmidt’s income from his em *829 ployment with the original corporation (“hospital contract”). The hospital contract was referred to in the employment agreement.

{¶ 4} On July 14, 2004, two weeks after the employment agreement expired, Dr. Pottschmidt resigned from the original corporation and in August 2004 filed suit against the original corporation. The complaint alleged a breach of the employment agreement for failure to pay Dr. Pottschmidt pursuant to the terms of the employment agreement and quantum meruit for the original corporation’s failure to pay Dr. Pottschmidt for the two weeks he worked for the original corporation after the term of the employment agreement expired.

{¶ 5} In September 2004, Dr. Klosterman, upon the advice of counsel, formed Klosterman Family Practice, Inc. (“new corporation”) in order to avoid liability related to Dr. Pottschmidt’s employment. The new corporation continued to exist with the same employees (sans Dr. Pottschmidt) in the same offices, with the same patients, the same letterhead (with Dr. Pottschmidt’s name removed), the same phone number, and the same equipment and office furniture. The new corporation opened a bank account at the same bank (First Merit) where the original corporation held an account, which account was closed in December of 2004. Some receipts from billings issued by the original corporation were deposited into the new corporation’s bank account.

{¶ 6} After the formation of the new corporation, Dr. Pottschmidt amended his complaint to add the new corporation and Dr. Klosterman as parties and to assert claims for successor liability, piercing the corporate veil, and violations of the Uniform Fraudulent Transfers Act (“FTA”), R.C. 1336.01 et seq.

{¶ 7} On August 29 and 30, and September 14, 2005, this matter was tried to a magistrate who issued her decision on October 5, 2005 (the “magistrate’s decision”). On October 13, 2005, appellants filed Civ.R. 53 objections to the magistrate’s decision, to which Dr. Pottschmidt responded on October 21, 2005, and the appellants replied on October 28, 2005. On November 22, 2005, the trial court overruled appellants’ objections and adopted the magistrate’s decision in its entirety (the “judgment entry”).

{¶ 8} On November 30, 2005, appellants filed a motion for a new trial and a motion for judgment notwithstanding the verdict, to which Dr. Pottschmidt responded on December 8, 2005, and the trial court denied on April 28, 2006.

{¶ 9} Appellants filed a timely notice of appeal, raising four assignments of error for our review.

II

ASSIGNMENT OF ERROR I

The magistrate’s findings of fact and conclusions of law, which were adopted in their entirety by the trial court, were against the manifest weight of the *830 evidence where the court erroneuously [sic] determined that (1) appellant Klosterman M.D., Inc. had breached its employment contract with appellee Pottschmidt concerning the maximium [sic] limitation on the amount of expenses that could be deducted from cash receipts generated by appellee, and (2) Klosterman M.D., Inc. And appellee Pottschmidt had not verbally agreed to waive that maximum limitation on expenses provision of the employment contract.

{¶ 10} In their first assignment of error, appellants contend that the original corporation did not breach the employment agreement because Dr. Pottschmidt and the original corporation verbally waived section 2(D)(2) of the employment agreement. Dr. Pottschmidt contends that he did not waive this provision and could not have done so as the employment agreement at section 10 included a no-modification provision.

{¶ 11} We review whether a judgment is against the manifest weight of the evidence in a civil context utilizing the same standard of review as that used in the criminal context. Frederick v. Born (Aug. 21, 1996), 9th Dist. No. 95CA006286, 1996 WL 471219, at *6. This court must, therefore, review the entire record, weigh the evidence and all reasonable inferences, consider the credibility of witnesses, and determine whether, in resolving conflicts in the evidence, the trier of fact clearly lost its way and created such a manifest miscarriage of justice that the judgment must be reversed and a new trial ordered. State v. Otten (1986), 33 Ohio App.3d 339, 340, 515 N.E.2d 1009.

{¶ 12} Further, this court has stated that it “will not reverse the judgment of the trial court as being against the manifest weight of the evidence if the judgment is based upon some competent, credible evidence that speaks to all of the material elements of the case.” Morris v. Andros, 158 Ohio App.3d 396, 2004-Ohio-4446, 815 N.E.2d 1147, at ¶ 18. “This standard is highly deferential and even ‘some’ evidence is sufficient to sustain the judgment and prevent reversal.” Bell v. Joecken (Apr. 10, 2002), 9th Dist. No. 20705, 2002 WL 533399, at *2. It is well established that “the weight to be given the evidence and the credibility of the witnesses are primarily for the trier of the facts.” State v. DeHass (1967), 10 Ohio St.2d 230, 39 O.O.2d 366, 227 N.E.2d 212, paragraph one of the syllabus. The trier of fact is in the best position to judge the credibility of the witnesses, view their demeanor, and weigh the evidence. Akron v. Portman, 9th Dist. No. 22921, 2006-Ohio-2856, 2006 WL 1540839, at ¶ 13; DeHass,

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Bluebook (online)
865 N.E.2d 111, 169 Ohio App. 3d 824, 2006 Ohio 6964, 2006 WL 3825206, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pottschmidt-v-thomas-j-klosterman-md-inc-ohioctapp-2006.