Russell v. McDonalds, Inc. 3737

2020 Ohio 4300

• Court: Ohio Court of Appeals
• Decided: September 3, 2020
• Docket: 109112
• Status: Published

Opinion

[Cite as Russell v. McDonalds, Inc. #3737, 2020-Ohio-4300.]

COURT OF APPEALS OF OHIO

EIGHTH APPELLATE DISTRICT COUNTY OF CUYAHOGA

URSULA WASHINGTON RUSSELL, :

Plaintiff-Appellee, : No. 109112 v. :

McDONALDS INC. #3737 :

Defendant-Appellant. :

JOURNAL ENTRY AND OPINION

JUDGMENT: AFFIRMED RELEASED AND JOURNALIZED: September 3, 2020

Civil Appeal from the Euclid Municipal Court Case No. 18-CVI-03687

Appearances:

Manchester Newman & Bennett, L.P.A., and Karly B. Johnson, for appellant.

LARRY A. JONES, SR., J.:

Plaintiff Ursula Washington Russell (“Russell”) alleged she was

assaulted by an employee of a McDonald’s in Euclid, Ohio. The McDonald’s was

owned by defendant H.L.W. Fast Track, Inc. d.b.a. McDonald’s (“Fast Track”).

Russell filed a complaint at the Small Claims Division of the Euclid Municipal Court, seeking $6,000 for the injury she sustained from the incident. Fast Track did not

appear at the hearing set for the small claims matter. The trial court entered a

judgment of $6,000 in favor of Russell. Fast Track subsequently filed a Civ.R. 60(B)

motion to set aside judgment. The trial court denied the motion. Fast Track now

appeals from the judgment. After a review of the record and the applicable law, we

conclude that the trial court did not abuse its discretion in denying Fast Track’s

motion to set aside judgment.

Background

Russell and Consuela Wilson had a prior dispute before the instant

assault incident. Wilson believed Russell’s husband was the father of Wilson’s child,

and both Russell and her husband had a restraining order against Wilson. Russell

alleged that, on February 21, 2017, she went to the drive-through window at the

McDonald’s located at 22291 Euclid Avenue in Euclid. Unbeknown to her, Wilson

was working at the drive-through window. When Wilson saw Russell, Wilson tried

to pull Russell through the drive-through window, and then came out of the building

to attack her. While running away from Wilson, Russell sprained her ankle. Russell

later went through two surgical procedures to repair her ankle. Wilson was

subsequently charged with assault and, because she was on probation for a prior

unrelated criminal case, she violated her probation and was returned to prison.

After the incident, Russell notified the Euclid McDonald’s. She also

called a McDonald’s complaint hotline to report the incident. According to Fast

Track, its insurance carrier determined that Wilson had been terminated several days before the incident. On October 23, 2018, Russell, pro se, filed a complaint in

the Small Claims Division of Euclid Municipal Court, naming “McDonald # 3737” as

defendant. She sought $6,000 for her ankle injury.

The trial court’s docket reflects that the summons and complaint were

sent by certified mail to 22291 Euclid Avenue, Euclid, Ohio. The certified mail was

addressed to “McDonald’s Inc. #3737 c/o Herbert Washington, 22291 Euclid Ave.,

Euclid, OH 44117.” Herbert Washington (“Washington”) is the owner and operator

of the Euclid McDonald’s. The court’s docket reflects a signed receipt of the certified

mail and also a notice to defendant for the hearing scheduled for this matter.

On the scheduled date, the magistrate held a hearing on the matter.

No one appeared on behalf of “McDonald’s Inc. #3737.” The magistrate took

evidence from Russell at the hearing and later issued a decision awarding plaintiff a

judgment of $6,000. The magistrate found Russell sustained a severe ankle fracture

that required two surgical procedures as a result of being assaulted by Wilson, and

she incurred significant medical expenses and was still receiving therapy. The

magistrate’s decision was sent to defendant at the Euclid address and it was not

returned to the court. On December 26, 2018, the trial court entered judgment

against “McDonald’s Inc. #3737.” The judgment was also sent to defendant at the

same address and it was similarly not returned to the court.

Civ.R. 60(B) Motion to Set Aside Judgment

On March 8, 2019, Fast Track, through counsel, filed a Civ.R. 60(B)

motion to set aside judgment. It argued that it was not served with the summons and complaint and, furthermore, even if it was aware of the lawsuit, its failure to

take any action regarding this matter constituted excusable neglect.

Attached to Fast Track’s motion was an affidavit from Thomas Micco

(“Micco”). He stated that Washington is the owner of H.L.W. Fast Track, Inc. that

owned 23 McDonald’s franchises at the time, including the Euclid McDonald’s, and

that Washington conducts his work primarily at the company’s corporate office in

Youngstown, Ohio. Micco, the company’s controller, further averred that no one at

Fast Track received the summons or the complaint in this case. Washington was

unaware of the lawsuit until March 27, 2018, when a manager of the Euclid

McDonald’s forwarded a picture of the judgment to Washington.

Micco stated that Fast Track’s records show that Russell called

McDonald’s complaint hotline on February 22, 2017, to report that on February 20,

2017,1 Wilson “spit on her and kicked her car.” McDonald’s hotline notified Fast

Track and York Insurance (“York”), Fast Track’s insurance carrier, of the alleged

incident. York then contacted Fast Track and requested the employee time records.

After an investigation, York determined that Wilson had been terminated on

February 15, 2017, several days before the alleged incident. Micco also averred that

its Employee Handbook prohibits any “discourtesy” towards customers and any

unlawful acts toward customers are terminable offenses.

1Russell’s complaint did not specify the date of the incident. At the hearing before the magistrate, Russell stated the date of the incident was February 21, 2017. On May 7, 2019, the magistrate held a hearing on Fast Track’s motion

to set aside judgment. At the hearing, the magistrate inquired regarding the

possibility of settlement and urged the parties to engage in settlement discussion.

Before the hearing was concluded, the magistrate offered Fast Track’s counsel an

opportunity to present additional evidence. Counsel replied that the brief

accompanying the motion had addressed all the issues and did not put on additional

evidence beyond the exhibits attached to the motion.

The settlement negotiations were unsuccessful. Subsequently, on

June 4, 2019, the magistrate issued a decision denying Fast Track’s motion to set

aside judgment. The magistrate noted that Fast Track did not deny that the

summons and complaint as well as the magistrate’s decision were all served at the

business location where the assault allegedly occurred, and that these legal

documents were sent in care of Washington, the owner of the business. The

magistrate found it difficult to comprehend why the management team at the Euclid

McDonald’s would sign for a certified letter from the municipal court in care of the

business’s owner and then ignore it. The magistrate noted that the mail from the

court containing his decision was also ignored.

Fast Track filed objections to the magistrate’s decision. The trial court

overruled the objections and adopted the magistrate’s decision. This appeal follows.

On appeal, Fast Track raises the following error for our review:

The trial court erred in denying Defendant-Appellant’s Motion to Set Aside Judgment. Fast Track first argues the trial court’s judgment was void because

Fast Track was not properly served with the complaint and summons. It claims that,

without effective service of process, the court did not have jurisdiction over it.

Service

Civ.R. 4.2(F) governs service of process on a corporation. It states

that a corporation may be properly served in any of the three ways: “by serving the

agent authorized by appointment or by law to receive service of process; or by

serving the corporation at any of its usual places of business by a method authorized

under Civ.R. 4.1 (A)(1); or by serving an officer or a managing or general agent of

the corporation.” Civ.R. 4.1(A)(1) provides for service by certified mail.

“In general, the test for determining whether a party was properly

served is whether service of process was ‘reasonably calculated, under all the

circumstances, to apprise interested parties of the pendency of the action and afford

them an opportunity to present their objections.’” Madorsky v. Radiant Telecom,

Inc., 8th Dist. Cuyahoga No. 87231, 2006-Ohio-6409, ¶ 7, quoting Akron-Canton

Regional Airport Auth. v. Swinehart, 62 Ohio St.2d 403, 406, 406 N.E.2d 811

(1980). “A determination of whether notice was reasonably calculated to reach the

interested party requires a case-by-case examination of the particular facts.” Id.

citing Nowak v. Nowak, 8th Dist. Cuyahoga No. 80724, 2003-Ohio-1824, ¶10.

Pursuant to Civ.R. 4.2(F), a corporation may be properly served at

“any of its usual places of business.” Here, Russell served the summons and

complaint by certified mail in care of Washington — who owned Fast Track — at one of its usual places of business, the Euclid McDonald’s, where the subject incident

occurred. The court’s docket reflected the certified mail was signed.

Fast Track, however, argues the service of process was not reasonably

calculated to alert it of the lawsuit, claiming that Russell should have served the

summons and complaint either through its statutory agent or at Fast Track’s

Youngstown corporate office. In support of its claim, Fast Track points to evidence

suggesting that Russell had searched the company in the Ohio Secretary of State

website and also points to the prelitigation communication Russell had with Fast

Track’s corporate office, which presumably reflected her awareness of its corporate

location in Youngstown.

We find no merit to Fast Track’s claim. Regardless of whether Russell

knew of Fast Track’s corporate office or its statutory agent, the question was whether

the service made at the Euclid McDonald’s, where the incident occurred, was

reasonably calculated to apprise Fast Track of pendency of the instant action. The

record shows Fast Track was aware of the incident at the Euclid McDonald’s. Its

insurance carrier had also requested records of its employees at that location for an

internal investigation. Under these circumstances, it defies common sense for Fast

Track to claim that the service of process made at its place of business where the

subject incident occurred was not reasonably calculated to alert it to the lawsuit. Excusable Neglect

Fast Track also claims that even if the service was proper, its failure to

respond to the lawsuit constituted excusable neglect because the summons and

complaint was never forwarded to “an appropriate party.”

“A motion for relief from judgment under Civ. R. 60(B) is addressed

to the sound discretion of the trial court, and that court’s ruling will not be disturbed

on appeal absent a showing of abuse of discretion.” Griffey v. Rajan, 33 Ohio St.3d

75, 77, 514 N.E.2d 1122 (1987).

To prevail on a motion for relief from judgment under Civ.R. 60(B),

the moving party must demonstrate that: (1) the party has a meritorious defense or

claim to present if relief is granted; (2) the party is entitled to relief under one of the

grounds stated in Civ.R. 60(B)(1) through (5); and, (3) the motion is made within a

reasonable time. GTE Automatic Elec., Inc. v. ARC Industries, Inc., 47 Ohio St.2d

146, 351 N.E.2d 113 (1976), paragraph two of the syllabus. If any of these three

requirements is not met, the motion should be overruled. Svoboda v. Brunswick, 6

Ohio St.3d 348, 351, 453 N.E.2d 648 (1983). Regarding the second requirement,

Civ.R. 60(B) states that “[o]n motion and upon such terms as are just, the court may

relieve a party or his legal representative from a final judgment, order or proceeding

for the following reasons: (1) mistake, inadvertence, surprise or excusable neglect

* * *.”

“[T]he 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.’” Colley v. Bazell, 64 Ohio St.2d 243, 248, 416 N.E.2d

605 (1980), quoting 11 Wright & Miller, Federal Practice & Procedure 140, Section

2851. In determining whether excusable or inexcusable neglect has occurred, a court

“must of necessity take into consideration all the surrounding facts and

circumstances.” Griffey v. Rajan, 33 Ohio St.3d 75, 79, 514 N.E.2d 1122 (1987).

A defendant’s inaction is not “excusable neglect” if it can be

characterized as a “complete disregard for the judicial system.” Kay v. Marc

Glassman, Inc., 76 Ohio St.3d 18, 20, 665 N.E.2d 1102 (1996). 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.” Emery v. Smith, 5th Dist. Stark Nos.

2005CA00051 and 2005CA00098, 2005-Ohio-5526, ¶ 16.

“While unusual or special circumstances can justify neglect, if a party

could have controlled or guarded against the happening or event he later seeks to

excuse, the neglect is not excusable.” Natl. City Bank v. Kessler, 10th Dist. Franklin

No. 03AP-312, 2003-Ohio-6938, ¶ 14.

In Sycamore Messenger, Inc. v. Cattle Barons, Inc., 31 Ohio App.3d

196, 509 N.E.2d 977 (1st Dist.1986), the First District upheld the trial court’s finding

of excusable neglect where a bookkeeper failed to forward a complaint to the

appropriate person and was later fired for the mishap. Subsequently, the appellate courts have elaborated on Sycamore’s holding and explained that it is not essential

that the specific identity of the person responsible for the mishap be revealed;

rather, an affidavit to support proof of excusable neglect is sufficient if it establishes

the following: “(1) that there is a set procedure to be followed in the corporate

hierarchy for dealing with legal process, and (2) that such procedure was,

inadvertently, not followed until such time as a default judgment had already been

entered against the corporate defendant.” Hopkins v. Quality Chevrolet, Inc., 79

Ohio App.3d 578, 583, 607 N.E.2d 914 (4th Dist.1992). See also, e.g., Perry v. Gen.

Motors Corp., 113 Ohio App.3d 318, 324, 680 N.E.2d 1069 (10th Dist.1996); Settlers

Bank v. Burton, 4th Dist. Washington Nos. 12CA36 and 12CA38, 2014-Ohio-335;

Replex Mirror Co. v. Solar Tracking Skylights, Inc., 5th Dist. Knox No. 10 CA 23,

2011-Ohio-2650; and Cooperider v. OK Cafe & Catering, Inc., 3d Dist. Marion No.

9-09-28, 2009-Ohio-6715. There is no requirement that the affidavit actually

describes the procedure in detail; it must merely state that a procedure exists and

that it was not followed. Kinter v. Giannaris, 11th Dist. Geauga No. 93-G-1781, 1994

Ohio App. LEXIS 1245, 11 (Mar. 25, 1994).

Here, Fast Track’s controller Micco’s affidavit stated that neither its

statutory agent nor any employee at Fast Track’s corporate office received the

summons or complaint, and Fast Track did not know what happened to the

summons and complaint. The affidavit further averred the following:

The vast majority of the employees at the franchises owned by H.L.W. Fast Track, Inc. are trained only on how to handle day-to-day fast food operations. Those same employees are not trained to handle summons, complaints, or other legal documents.

Micco’s affidavit, rather than establishing that there was a certain

procedure to be followed in the corporate hierarchy for dealing with important court

documents, actually acknowledged there was a lack of any such procedure. As the

magistrate noted, subsequent mails containing legal documents from the court were

similarly ignored. Having been made aware of the alleged incident at the Euclid

McDonald’s, Fast Track failed to respond to the action filed in the court regarding

the incident. The neglect reflects its own carelessness, inattention, or willful

disregard of the process of the court; it is not a result of some “unexpected or

unavoidable hindrance or accident.” Emery, supra.

Fast Track relied on Hopkins, supra, that held that “relief from default

judgment may be granted on the basis of excusable neglect when service is properly

made on a corporation but a corporate employee fails to forward the summons and

complaint to the appropriate person.” Id. at 582. In Hopkins, however, the affidavit

submitted by defendant averred that in the ordinary course of its business all legal

matters were to be referred to the company’s general manager or president. Here,

Micco’s affidavit did not establish any such corporate procedure; neither did it set

forth any facts explaining why a certified letter from a court sent in care of the owner

of the business failed to be reported up the chain of command.2

2Fast Track also cites Enhanced Sys., Inc. v. CBM Computer Ctr., 8th Dist. Cuyahoga No. 56978, 1989 Ohio App. LEXIS 2870 (July 20, 1989) to support its claim. There, defendant corporation submitted affidavits showing that its controller received the Because Fast Track fails to demonstrate excusable neglect, we do not

reach the issue of whether it has a meritorious defense in the underlying case, or

whether Fast Track’s motion to set aside judgment, filed 72 days after the entry of

the court’s judgment, was made within a reasonable time.

Having reviewed the record and the applicable case law precedents,

we conclude the Euclid Municipal Court did not abuse its discretion in denying Fast

Track’s Civ.R. 60(B) motion to set aside judgment.

Judgment affirmed.

It is ordered that appellee recover of appellant 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

Euclid Municipal Court to carry this judgment into execution.

A certified copy of this entry shall constitute the mandate pursuant to Rule

27 of the Rules of Appellate Procedure.

LARRY A. JONES, SR., JUDGE

PATRICIA ANN BLACKMON, P.J., and RAYMOND C. HEADEN, J., CONCUR

complaint and immediately forwarded it to its general counsel in the corporate office in Kentucky but somehow the corporate office did not receive it. This court determined that defendant sufficiently alleged grounds of excusable neglect: after the complaint was received, the corporation misplaced it during the process of sending the complaint to its general counsel. Enhanced Sys. is also distinguishable.