Rutan v. Kelly

2025 Ohio 4765

• Court: Ohio Court of Appeals
• Decided: October 10, 2025
• Docket: 25 CO 0005
• Status: Published

Opinion

[Cite as Rutan v. Kelly, 2025-Ohio-4765.]

IN THE COURT OF APPEALS OF OHIO SEVENTH APPELLATE DISTRICT COLUMBIANA COUNTY

DENISE RUTAN ET AL.,

Plaintiffs-Appellants,

v.

RONALD KELLY ET AL.,

Defendants-Appellees.

OPINION AND JUDGMENT ENTRY Case No. 25 CO 0005

Civil Appeal from the Court of Common Pleas of Columbiana County, Ohio Case No. 2023 CV 435

BEFORE: Cheryl L. Waite, Mark A. Hanni, Katelyn Dickey, Judges.

JUDGMENT: Affirmed.

Atty. Frank J. Witschey, Witschey, Witschey & Firestine Co., LPA, Atty. Christopher J. Van Blargan, Kisling, Nestico & Redick, LLC, and Atty. Nomiki P. Tsarnas, Kisling, Nestico & Redick, LLC, for Plaintiffs-Appellants

Atty. Scott C. Essad, for Defendants-Appellees Ronald Kelly, Erin Kelly Miller, Amanda Fry, Cheryl Pierce, David Pierce, Yellow Creek Casting Co. Inc., Jeannie Parker, Emmet Hughes and Sandra Kelly Hughes.

Atty. Matthew M. Ries, Harrington, Hoppe & Mitchell, Ltd., for Defendant-Appellee Byler, Wolfe, Lutsch, Kampfer, CPAs, Inc. –2–

Atty. David S. Barbee and Atty. Robert Buch, Roth, Blair, Roberts, Strasfeld & Lodge LPA, for Defendant-Appellee Dan Wolfe.

Dated: October 10, 2025

WAITE, J.

{¶1} This case involves a complaint filed in the general division of the

Columbiana County Court of Common Pleas for fraud, conversion, misappropriation,

undue influence, conspiracy, and intentional interference with expectancy of inheritance

(“IIEI”). Appellants/Plaintiffs Denise Rutan and Danny Kelly were named in the will of

their mother Lois Kelly who died in 2019. Lois was preceded in death by her husband

Gerald, who died in 2014. Appellants claim that their siblings, as well as other defendants

connected to a family business, squandered their parents' personal and business assets,

and in doing so deprived Appellants of any inheritance from their parents. The factual

underpinning of all the claims is an allegedly fraudulent transfer in 2010 of shares of stock

of the family business. The defendants to the trial action filed motions for summary

judgment, and Appellants responded. The court characterized all of Appellants’ causes

of actions as arising from fraud, and the court granted Appellees’ (who are Appellants’

siblings) motions for summary judgment on the ground that the four-year statute of

limitations for fraud found in R.C. 2305.09(C) had expired prior to the filing of the 2023

lawsuit. The court also held that, although the discovery rule for fraud contained in R.C.

2305.09(E) applied, Appellants discovered or should have discovered the alleged fraud

by at least 2014, thus, the statute of limitations expired in 2018.

{¶2} Appellants raise three arguments on appeal. First, they contend that the

court failed to apply a reasonable person standard in its application of the discovery rule.

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They claim that a reasonable person would not have discovered the fraud until 2019, after

their mother died and they found out they would not receive an inheritance from either

parent. The standard for applying the discovery rule for fraud is that the statute of

limitations begins to run when the plaintiff discovered or should have discovered the

alleged injury. The trial court correctly applied this rule based on the allegations of fraud

that Appellants admittedly knew as early as the 1990s and were thoroughly aware of by

2014. Applying the discovery rule, the statute of limitations for fraud began to run at least

by 2014, and Appellants' 2023 complaint is time barred.

{¶3} Second, Appellants argue that they did not have standing to file an IIEI

action until 2019 when Lois died, so their causes of action were not ripe until 2019. They

argue that the statute of limitations could not have started to run until standing and

ripeness were both satisfied. This argument, however, was not made to the trial court

and is waived.

{¶4} Third, Appellants argue that counts eight and nine of the complaint should

not have been dismissed because they were independent of the the other counts. The

record shows that counts eight and nine were dependent on the court making particular

findings in the first seven counts, and because the first seven counts were appropriately

dismissed due to the running of the statute of limitations, the court properly dismissed

counts eight and nine as well. The court correctly granted summary judgment to

Appellees, and the judgment is affirmed.

Facts and Procedural History

{¶5} The Plaintiffs/Appellants in this case are siblings Denise Rutan (“Denise”)

and Danny Kelly (“Danny”). Defendants/Appellees Ronald Kelly, Cheryl Pierce, Sandra

Kelly Hughes, and Jeannie Parker are also siblings. The parents of these six siblings

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were Gerald Kelly (“Gerald”) and Lois Kelly (“Lois”), who died in 2014 and 2019

respectively.

{¶6} Gerald and Lois were founders of a company called Yellow Creek Casting

Co., Inc. (“YCC”) in Wellsville, Ohio, a cast-iron and steel manufacturing business. They

each owned one-half of the total 750 shares of common stock. In addition to Appellants’

siblings, YCC and persons who worked for it are also Appellees in this matter.

{¶7} Appellant Danny resided primarily in the State of New York since first

moving there in 1971. In the mid 1990s, he commuted from New York to work at YCC

and also ran a foundry located across the street from YCC. While working at YCC, Danny

became versed in both the production side of the business as well as the financial side.

In 1992 Danny intended to buy the assets of YCC and reincorporate under a new name.

He was encouraged to do this by Lois, but Gerald did not approve of Danny’s plan. In

1997 Danny stopped working at YCC altogether. After he left YCC, Danny had very little

contact with his parents.

{¶8} While working at YCC in the 1990s, Danny uncovered questionable

activities taking place in the business. He described his sister Cheryl Pierce and her

husband David Pierce as "no show" employees, and he fired them. He also suspected

Sandra Kelly Hughes, who began working at YCC in 1995, of engaging in financial

misconduct.

{¶9} Appellant Denise Rutan was employed at YCC for a brief period in the

1980s. In 2007 she did some cleaning work at YCC. In 2010, Denise spoke with Gerald

about his concerns that the company should have been making more money. She

suggested that the company books be audited. Gerald and Lois agreed, but the audit did

not take place. At some point in 2010, Gerald told Denise that the common shares of

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stock would be equally transferred to her siblings Cheryl Pierce, Sandra Kelly Hughes,

and Ronald Kelly. The other three siblings would receive no common stock. After 2010,

Gerald and Lois were no longer listed in the corporate records or tax filings as

shareholders, and they were not paid salaries, bonuses, or dividends.

{¶10} In 2012, Sandra Kelly Hughes discussed with Denise the common stock

transfer. Sandra Kelly Hughes started working at YCC in the 1990s, became the office

manager, and left in 2012. Also in 2012, Denise obtained shares of preferred stock in the

company. She was later told by Appellee Dan Wolfe, a CPA who performed services for

YCC, that the preferred shares were worthless and would not generate dividend

payments. At about that same time, Sandra Kelly Hughes told Appellant Danny about

the stock transfer and that Dan Wolfe was involved in the stock transactions.

{¶11} During 2012, Sandra Kelly Hughes told Appellant Denise that she had been

keeping two sets of accounting books at YCC, and that Gerald was only shown one set

of books. Sandra Kelly Hughes opined that if Gerald knew how much money the company

had been making, he would have taken that money out of the company. Sandra Kelly

Hughes also told Denise that improper tax documents were prepared, assets were

concealed, and company records were altered. Denise learned that Sandra Kelly Hughes

was ousted from her job at YCC in 2012, despite being a major shareholder. Denise

learned that her siblings were allegedly converting YCC funds for personal use, and

personal expenses were being charged to the company. Denise suspected at that time

that Sandra Kelly Hughes was also likely involved in the conversion of YCC funds and

assets.

{¶12} In Denise's deposition, she admitted that in 2012 Sandra Kelly Hughes

confessed to these bad acts in writing. The confession includes details of alleged

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misappropriation of funds by Sandra Kelly Hughes, Cheryl Pierce, and Ronald Kelly.

Appellant Danny received the same information by email. He referred to Appellees’

activities as embezzlement.

{¶13} In 2013, Appellant Danny had a conversation with Gerald and Lois

regarding obtaining a loan from them. They told him at that time they had no money and

that Jeannie Parker was in charge of their finances.

{¶14} In 2014, Appellant Denise learned that her siblings were allegedly emptying

their parents' bank accounts. This information again came from Sandra Kelly Hughes.

Denise testified that she tried to stop her siblings from draining the accounts prior to Lois's

death in 2019.

{¶15} On October 14, 2014, Appellant Denise purchased one-half of Sandra Kelly

Hughes' stock in YCC for $1. The sales agreement stated that Hughes owned 50% of

the YCC stock, thus making Denise a 25% owner. Denise never discussed this stock

purchase with Gerald or Lois, or with Appellee Wolfe. It was not until 2023 that Denise

first asked the YCC Board of Directors to honor her ownership interest.

{¶16} Appellants' complaint alleges that Gerald Kelly died testate on December

16, 2014 and Lois Kelly died testate on December 1, 2019. Appellants allege that

Gerald's will was not admitted to probate, and the primary or sole beneficiary was Lois

Kelly. They allege that Lois's will was dated December 30, 2014 and was likewise not

admitted to probate, and that all six of her children, including Appellants, are listed as

beneficiaries of the will. These allegations are not disputed.

{¶17} Appellants filed a complaint in the Columbiana County Court of Common

Pleas General Division on July 31, 2021 (“2021 complaint”). It named 20 defendants and

contained claims of interference with inheritance, conversion, fraud, conspiracy, and a

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request for an accounting. The complaint was extensively litigated and entered the

summary judgment stage, but was voluntarily dismissed with prejudice on July 28, 2023.

{¶18} On September 22, 2023, Appellants filed a second complaint in the

Columbiana County Court of Common Pleas General Division (“2023 complaint”). This

complaint contained somewhat different defendants, contained modified allegations, and

sets forth additional factual circumstances. It named seventeen defendants, some of

which were not named in the 2021 complaint, such as YCC.

{¶19} The 2023 complaint has nine counts: (1) intentional interference with

inheritance; conversion and misappropriation; (2) intentional interference with expectancy

of inheritance: fraud; (3) intentional interference with expectancy of inheritance: illegality

of transaction; (4) undue influence; (5) alteration of documents; (6) conspiracy; (7) request

for accounting; (8) declaratory judgment; and (9) conversion of stock and capital account.

{¶20} On October 25, 2023, Appellees Sandra Kelly Hughes and Emmet Hughes

filed a motion to dismiss. The remaining defendants followed with their own motions to

dismiss. On March 13, 2024, the trial court denied the motions to dismiss, and in a lengthy

judgment entry ruled that the general division of the court, rather than the probate division,

had jurisdiction over the complaint. The court ruled that dismissal under Civ.R. 12(B)(1)

for lack of subject matter jurisdiction was not appropriate as the actual nature and

essential character of Appellants' complaint was fraud, and that Appellants “do not dispute

this characterization of their claims.” The court cited Appellants' brief in opposition to the

motions to dismiss: “Plaintiffs' primary and core causes of action in this case center on

Defendant's attempts to defraud and otherwise illegally cause decedents to transfer their

stock shares to the Defendants, Sandra Kelly Hughes, Ronald Kelly, and Cheryl Pierce.”

(12/15/23 Brief in Opposition, p. 2). The next sentence of the brief in opposition states:

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“The primary causes of action allege those stock transfers never happened.” (12/15/23

Brief in Opposition, p. 2-3). The court determined that the complaint was divided into

claims of intentional interference with expectancy of inheritance through conversion,

misappropriation, fraud, illegal transaction, undue influence, fraudulent alteration of

documents, conspiracy, and fraudulent conversion of stock and capital account. The trial

court held that, as a matter of law, these causes of action were governed by the four-year

statute of limitations for fraud pursuant to R.C. 2305.09. The court also held that the

discovery rule for fraud in R.C. 2305.09(E) applied, and that there were factual matters in

dispute that prevented dismissal under Civ.R. 12(B)(6).

{¶21} On May 10, 2024, Appellees Sandra Kelly Hughes and Emmet Hughes filed

a motion for summary judgment. The remaining defendants then filed their own summary

judgment motions. The depositions of Appellants Danny Kelly and Denise Rutan were

made part of the record in support of the motions, along with depositions from many other

defendants.

{¶22} On February 20, 2025, the court filed a judgment entry granting summary

judgment to all defendants on the first seven counts in the complaint, on the basis that

the statute of limitations for fraud had expired at the latest by 2018, long before the 2023

complaint was filed. The judgment entry sets forth an extensive factual exposition citing

to Appellants’ deposition and other evidence of record showing that Appellants knew or

should have known the basis for all seven causes of action by 2014, at the latest.

{¶23} Appellants filed a notice of appeal on March 21, 2025. On March 25, 2025

Appellants filed a motion for stay and limited remand for the trial court to clarify whether

its ruling included counts eight and nine of the complaint. We granted the motion and

remanded the case for the limited purpose of clarifying the disposition of counts eight and

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nine in the final judgment entry. On April 30, 2025, the trial court issued another judgment

entry holding that counts eight and nine sprang from the first seven causes of action. The

court held that counts eight and nine were moot after the dismissal of the first seven

claims, or in the alternative were barred by the four-year statute of limitations for fraud.

The appeal was returned to active status and Appellants filed their brief. Three different

Appellee briefs were filed. Appellants filed a single reply brief. Appellants assert three

assignments of error.

Summary Judgment Standard

{¶24} An appellate court conducts a de novo review of a trial court's decision to

grant summary judgment, using the same standards as the trial court set forth in Civ.R.

56(C). Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 105 (1996). Before summary

judgment can be granted, the trial court must determine that: (1) no genuine issue as to

any material fact remains to be litigated, (2) the moving party is entitled to judgment as a

matter of law, (3) it appears from the evidence that reasonable minds can come to but

one conclusion, and viewing the evidence most favorably in favor of the party against

whom the motion for summary judgment is made, the conclusion is adverse to that party.

Temple v. Wean United, Inc., 50 Ohio St.2d 317, 327 (1977). Whether a fact is “material”

depends on the substantive law of the claim being litigated. Hoyt, Inc. v. Gordon & Assoc.,

Inc., 104 Ohio App.3d 598, 603 (8th Dist. 1995).

{¶25} “[T]he moving party bears the initial responsibility of informing the trial court

of the basis for the motion, and identifying those portions of the record which demonstrate

the absence of a genuine issue of fact on a material element of the nonmoving party's

claim.” (Emphasis deleted.) Dresher v. Burt, 75 Ohio St.3d 280, 296 (1996). If the

moving party carries its burden, the nonmoving party has a reciprocal burden of setting

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forth specific facts showing that there is a genuine issue for trial. Id. at 293. In other

words, when presented with a properly supported motion for summary judgment, the

nonmoving party must produce some evidence to suggest that a reasonable factfinder

could rule in that party's favor. Brewer v. Cleveland Bd. of Edn., 122 Ohio App.3d 378,

386 (8th Dist. 1997).

{¶26} The evidentiary materials to support a motion for summary judgment are

listed in Civ.R. 56(C) and include the pleadings, depositions, answers to interrogatories,

written admissions, affidavits, transcripts of evidence, and written stipulations of fact that

have been filed in the case. In resolving the motion, the court views the evidence in a

light most favorable to the nonmoving party. Temple, 50 Ohio St.2d at 327. A party

cannot create a genuine issue of material fact by ignoring or contradicting their own

deposition testimony. Byrd v. Smith, 2006-Ohio-3455, ¶ 28 (a party's affidavit that

contradicts their deposition testimony does not create a genuine issue of material fact);

Isaac v. Alabanza Corp., 2007-Ohio-1396, ¶ 41 (7th Dist.) (self-contradictory statements

by the plaintiff in a deposition cannot be used to overcome defendant's motion for

summary judgment).

ASSIGNMENT OF ERROR NO. 1

THE TRIAL COURT ERRED IN GRANTING SUMMARY JUDGMENT ON

DENISE AND DANNY'S CLAIMS OF INTENTIONAL INTERFERENCE

WITH EXPECTANCY OF INHERITANCE ASSERTED IN THE FIRST

THROUGH SIXTH CAUSES OF ACTION AND FINDING THEY WERE

BARRED BY APPLICABLE STATUTES OF LIMITATIONS WHERE,

CONTRARY TO THE COURT'S RULING, REASONABLE MINDS COULD

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DIFFER AS TO WHEN A "REASONABLE" PERSON SHOULD HAVE

DISCOVERED THE ALLEGED ACTIONABLE CONDUCT AND INJURIES,

AND THUS, WHEN THE STATUTE OF LIMITATIONS ACCRUED UNDER

THE DISCOVERY RULE.

{¶27} Appellants argue that the trial court failed to properly apply the discovery

rule when it determined that the statute of limitations for fraud set forth in R.C. 2305.09(C)

applied to the claims in their complaint. Appellants do not dispute that R.C. 2305.09(C),

the four-year statute of limitations for fraud, applies (at least in part) to this case, but they

believe their 2023 complaint overcame any statute of limitations problem that may have

existed in their 2021 complaint. Appellants contend that they are now arguing they first

discovered the facts giving rise to their claims after Lois's death in 2019. They argue that

even though they knew about the alleged fraudulent activities surrounding the 2010 YCC

stock transfer, they still believed Gerald and Lois had substantial assets apart from YCC

that would pass to Appellants through Lois's will.

{¶28} Put another way, Appellants contend they had a sense that their parents

had significant assets including YCC stock, that their parents wanted to give some of their

assets to Appellants when they died, and that they did not know Appellees had

squandered both the company assets as well as their parents' personal assets until after

Lois died. They argue that Appellees fraudulently claimed that they owned all the

company stock, fraudulently managed the company without authority to do so, and

fraudulently dissipated Gerald and Lois's personal assets. Thus, the overall claim made

in Appellants' complaint is one of intentional interference with the expectation of

inheritance (“IIEI”) based on fraud.

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{¶29} The Ohio Supreme Court recognized the tort of IIEI in Firestone v.

Galbreath, 67 Ohio St.3d 87 (1993). The elements are:

(1) an existence of an expectancy of inheritance in the plaintiff; (2)

an intentional interference by a defendant(s) with that expectancy of

inheritance; (3) conduct by the defendant involving the interference which

is tortious, such as fraud, duress or undue influence, in nature; (4) a

reasonable certainty that the expectancy of inheritance would have been

realized, but for the interference by the defendant; and (5) damage resulting

from the interference.

Id. at 88.

{¶30} Normally these claims are litigated in probate court under that court's

plenary jurisdiction because initial questions about the expectancy of inheritance are

dependent on the terms of a will and the contents of the probate estate. "The general

division of the court of common pleas would normally need to wait for these issues to be

resolved before proceeding with a related tort action." In re Estate of Goehring, 2007-

Ohio-1133, ¶ 66 (7th Dist.). The trial court in this case, in ruling on motions to dismiss for

lack of jurisdiction, held that it did have proper jurisdiction because neither Gerald's nor

Lois's will had been probated. Both Appellants could have opened a probate estate if, as

they allege, they are mentioned in the wills and as such are heirs and interested parties

in the probate estate. R.C. 2721.05. Some of the Appellees raise this jurisdictional issue

on appeal, but Appellees did not file cross-appeals, and as the issues raised by Appellants

only address questions regarding the statute of limitations this issue has been waived.

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{¶31} Appellants' arguments in this matter are, to say the least, very muddled.

They do not plead a typical claim of IIEI, in which the alleged fraud is some type of

tampering with the creation of a will or invalidating testamentary documents. Many, if not

most, IIEI cases involve claims arising from fraud in the creation or destruction of a will or

estate planning document, thus depriving the plaintiff of a testamentary inheritance. See,

e.g., Vondrasek v. Heiss, 2024-Ohio-3061 (11th Dist.) (fraud in manipulating transfer on

death designations and changing beneficiaries); Carpenter v. Carpenter, 2023-Ohio-274

(7th Dist.) (fraud based on improper creation of Medicaid protection trust); Widok v. Estate

of Wolf, 2020-Ohio-5178 (8th Dist.) (fraud perpetrated by the intentional destruction of the

will); Krohn v. Ostafi, 2020-Ohio-1536 (6th Dist.) (defendant induced father to make

transfer on death changes to exclude the plaintiff). Appellants simply complain that they

believed their parents had substantial personal assets during their lives and that

Appellants did not receive any of that money after their parents died, as they had hoped.

They believe Appellees are responsible for that situation. They do not argue that

Appellees exerted any influence over the content of Gerald and Lois's wills.

{¶32} It is very difficult to uncover a consistent line of argument from Appellants'

briefs. They allege fraud by the Appellees going back to the 1990s, but contend their

claims, based on fraud, only arose after 2019. Denise claims she both owns stock and

does not own stock, that it is valuable stock and that it is worthless, that there were stock

transfers in 2010, 2012, and 2014, and that there were no such transfers. Despite the

extensive citations in the trial court's final judgment that contradict their arguments,

Appellants maintain that it was reasonable for them not to act on the evidence of fraud

they had been aware of since the 1990s, and that the discovery rule preserves their

causes of action.

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{¶33} R.C. 2305.09(C) provides for a four-year statute of limitations in which to

bring causes of action alleging fraud. R.C. 2305.09(E) applies a discovery rule for a claim

of fraud. "The discovery rule tolls the statute of limitations only until the plaintiff has an

'indication' of the defendant's wrongful conduct." Doane v. Givaudan Flavors Corp., 2009-

Ohio-4989, ¶ 14 (1st Dist.), citing Norgard v. Brush Wellman, Inc., 2002-Ohio-2007. The

Ohio Supreme Court has interpreted the discovery rule to mean that the statute of

limitations commences when the complainant has discovered, or should have discovered

in the exercise of reasonable diligence, the alleged fraud. Investors REIT One v. Jacobs,

46 Ohio St.3d 176, (1989), paragraph 2b of the syllabus (referring to an earlier version of

R.C. 2305.09):

For example, if the cause of action is for fraud, the cause does not

accrue until either the fraud is discovered, or in the exercise of reasonable

diligence, the fraud should have been discovered. [ ] Thus, the applicable

statute of limitations is triggered by the “constructive knowledge of facts,

rather than actual knowledge of their legal significance . . .”

Id. quoting Flowers v. Walker, 63 Ohio St.3d 546, 549 (1992); see also Doe v.

Archdiocese of Cincinnati, 2006-Ohio-2625, ¶ 21.

{¶34} We have similarly described this rule: "Under the discovery rule, the statute

of limitations does not begin to run until the plaintiff discovered, or through the exercise

of reasonable diligence, should have discovered, the complained of injury." Porter v.

Probst, 2014-Ohio-3789, ¶ 24 (7th Dist.).

{¶35} Appellants urge that a reasonable person standard applies to the use of the

discovery rule, and that a reasonable person would not have been looking for fraudulent

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activity until after Lois's death, since that is when Appellants would have expected to

inherit. Appellants argue that the trial court should not have relied on proof as to when

they actually learned about the alleged fraud and should only have considered when a

reasonable person would have tried to uncover it, which they believe would only occur

after the testator has died.

{¶36} Although a reasonable person standard applies to the discovery rule in

certain circumstances, it does not supplant the fact that an actual knowledge standard

also applies. Thus, the discovery rule operates both subjectively (actual knowledge) and

objectively (knowledge that could have been gained using reasonable diligence).

Although the trial court relied on what Appellants "should have known" and the objective

aspect of the discovery rule, Appellants' actual knowledge of events from the 1990s

through 2014 contributes to any analysis as to what they should have known using

reasonable diligence.

{¶37} Appellees raise several rebuttal arguments that go beyond the trial court's

statute of limitations rationale. Appellee Dan Wolfe (the CPA who did work for YCC,

including the preparation of tax documents) argues that Appellants presented insufficient

evidence to support any of their claims, including failing to provide evidence of any

monetary damage. This is significant, because the trial court's basis for retaining

jurisdiction over the case (despite a clear preference in the law for jurisdiction in the

probate court) was Appellants' claim for money damages that a probate court would be

unable to award.

{¶38} The joint brief of Appellees Ronald Kelly, Erin Kelly Miller, Amanda Fry,

Cheryl Pierce, David Pierce, Jeannie Parker, Sandra Kelly Hughes, Emmet Hughes, and

YCC argues that use of a reasonable person standard for the discovery rule is

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unnecessary here, because Appellants were on actual notice of the allegedly fraudulent

and tortious behavior prior to 2014. All of Appellants' claims are governed by various

four-year statutes of limitation and those statutes expired, at the latest, by 2018 based on

actual knowledge of Appellants’ claimed injuries.

{¶39} The Appellee brief of Byler, Wolfe, Lutsch & Kampfer, CPAs, Inc. (Appellee

Byler) agrees with these arguments: that all of the claims in the complaint are subject to

a four-year statute of limitations, and that actual subjective knowledge of the claimed

injuries partly determines the application of the discovery rule. Appellee Byler argues that

even when the discovery rule is applied, the reasonableness of a plaintiff's actions are

not examined in a vacuum. The court must look at what the plaintiff actually knew, and

in that light, what action that plaintiff would take using reasonable diligence. Here,

Appellants testified they discovered various fraudulent acts (whether it related to stock

transfers, Appellees' alleged mismanagement of the company and improper use of YCC

funds, improper filing of tax returns, using multiple sets of accounting books, the spending

of Gerald and Lois's money, etc.) over the course of several years, but at the latest, by

2014.

{¶40} Despite Appellants' attempt to complicate this case, the answer to the

statute of limitations question is quite simple. This case is about fraud involving the

personal and corporate assets of Gerald and Lois Kelly. The extent of the fraud in this

case was known, or should have been known by Appellants by 2014 at the latest, by their

own admissions. Hence, they were required to file their lawsuit by 2018 at the latest.

Even though the lawsuit was framed as an IIEI claim, the essence and root of the

complaint was fraud and Appellants’ claims were consistently presented in that manner

to the trial court. The trial court's judgment entry carefully set out the undisputed evidence

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regarding Appellants' knowledge of this alleged fraud prior to 2014, almost all of which is

found in Appellants' own deposition testimony.

{¶41} Appellant Denise Rutan testified at deposition testimony that she knew she

was named as a beneficiary in her parents' wills as early as 2009 or 2010. (Denise Depo.,

pp. 23-24.) She was aware in 2012 that Sandra Kelly Hughes believed she was being

forced out of YCC. Sandra Kelly Hughes told Denise that various siblings were misusing

YCC funds to buy personal items. (Denise Depo., p. 44.) They would buy a car or a

countertop and charge it to the YCC capital spending account. (Denise Depo., p. 45.) As

early as 2012, Denise was told that Sandra Kelly Hughes was keeping multiple sets of

accounting books to conceal certain expenditures and that Gerald Kelly was being shown

only one set. (Denise Depo., p. 58.) She had information that tax returns were being

altered to conceal the expenditures. (Denise Depo., p. 62.) At that time, Denise talked

to her parents about some of the accusations and suggested conducting an audit.

(Denise Depo., p. 49.) Denise chose not to tell her parents about the accounting

manipulation because she did not think they would listen to her. (Denise Depo., p. 53.)

She believed many of her parents' assets were being concealed by her siblings, including

cash, a house in North Lima, treasury bills, certificates of deposit, vehicles, and the

contents of safe deposit boxes. (Denise Depo., p. 64.) Denise was aware of all these

actions in 2012, according to her own testimony. Denise also testified that Sandra Kelly

Hughes sold Denise her shares of stock in 2014 amounting to a 25% share of YCC.

(Denise Depo., p. 192.). Hence, Appellant Denise became a major stockholder in the

company, or at least believed she was at that time.

{¶42} Appellant Danny provided contradictory deposition testimony as to whether

he had any expectation of an inheritance at all. At first, he stated unequivocally that he

Case No. 25 CO 0005 – 18 –

had no expectation of any inheritance. (Danny Depo., pp. 41, 42.) Then he testified that

he did have some expectation of inheritance in 1991, namely, that he would inherit

enough to help pay for the cost of building his house and his barn. (Danny Depo., p. 43.)

Danny worked at YCC until 1997 and learned all of the aspects of the business. (Danny

Depo., pp. 27-28, 45, 219, 223-224.) He knew that Cheryl Pierce and David Pierce were

being paid, but were not doing any work, and so he fired them. (Danny Depo., p. 231;

Cheryl Pierce Depo., p. 16.) He knew in 2013 that Jeannie Parker was solely in control

of the finances of Gerald Kelly and Lois Kelly and that they had very little money left at

that time. (Danny Depo., p. 60.) He knew that Sandra Kelly Hughes had been the office

manager of YCC since the 1990s, that she left in 2012, but had remote access to all of

the company’s records. (Danny Depo., pp. 53-54.) When Sandra Kelly Hughes tried to

reinstate herself into the company, Danny was aware that Sandra Kelly Hughes had

knowledge of "lots of nefarious activities which were documented by her paperwork."

(Danny Depo., p. 54.) This included evidence of employees writing personal checks from

office accounts, buying houses and cars with company money, and directly moving

money from business accounts to personal accounts. (Danny Depo., pp. 54-55.)

{¶43} Even if we presume that all of this knowledge was not sufficient to take legal

action at the time and that Appellants needed more evidence, the discovery rule does not

preserve their claims. The discovery rule imputes constructive knowledge, i.e., what

could have been discovered using reasonable diligence. Flowers at 549. If, as they aver,

Appellants knew that Sandra Kelly Hughes had all the necessary records in her

possession to prove that YCC assets were being systematically drained, and they knew

that the company was the basis of Gerald and Lois's wealth, then Appellants should have

fully uncovered or attempted to uncover the fraud, conversion, and any other misdeeds

Case No. 25 CO 0005 – 19 –

when they had the opportunity to do it, which based on this record was no later than 2014

when Denise believed she became a stockholder.

{¶44} All of the foregoing assumes, as the trial court did, that Appellants' claims

are entirely based on fraud. It is the allegation of fraud that triggers application of the

discovery rule. Appellants also contend that the discovery rule directly applies to the tort

of intentional interference with the expectancy of inheritance, absent an allegation of

fraud. It does not. R.C. 2305.09(E) specifically pertains to the tort of fraud. The statute

does not mention or even imply that it applies to intentional torts, such as intentional

interference with an expectancy of inheritance. We came to a similar conclusion in

another case involving an IIEI claim: "Appellants provide no cases where a court has

applied the discovery rule to the tort of intentional interference with the expectancy of

inheritance, and there does not appear to be any such caselaw." In re Estate of Goehring,

2007-Ohio-1133, ¶ 79 (7th Dist.). Other courts have held that claims involving tortious

interference do not invoke the discovery rule. See Wilkerson v. Hartings, 2009-Ohio-

4987, ¶ 11 (1st Dist.) (it does not apply to claims for intentional interference of business

opportunities); Porter v. Probst, 2014-Ohio-3789, ¶ 23 (7th Dist.) (it does not apply to any

claims of tortious interference). We are only aware of one case post-dating Estate of

Goehring where the fraud provision of R.C. 2305.09(E) has been applied to an IIEI claim,

and that was only because the essence of the IIEI claim was fraud, just as in the matter

before us. McDougal v. Vecchio, 2012-Ohio-4287 (8th Dist.).

{¶45} If Appellants now contest characterization of their claims as essentially

fraud, then they cannot avail themselves of the discovery rule. Only because they have

accepted that the essence of all their claims is fraud can they attempt to apply the

Case No. 25 CO 0005 – 20 –

discovery rule. Regardless, it is clear from the undisputed facts that the four-year statute

of limitations expired long before the filing of Appellants’ 2023 complaint.

{¶46} If Appellants believed fraud was taking place from the 1990s through 2014,

as their evidence demonstrates, it was the discovery of this fraudulent activity that

triggered the running of the discovery rule and the statute of limitations. If they contend,

as they now imply, that the fraud did not impact them at the time because they were

waiting to see what their actual inheritance would be, then their causes of action are not

based on fraud and the discovery rule does not apply. Nevertheless, the harm for which

they are seeking redress (and which they admittedly knew about) occurred from the

1990s through 2014, no matter how Appellants now frame the matter.

{¶47} Appellants' arguments in their 2023 complaint shifted from the allegations

raised in their 2021 complaint. They now allege a fraud in the transfer (or attempted

transfer) of shares of YCC to Ronald Kelly, Sandra Kelly Hughes, and Cheryl Pierce while

at the same time concealing the transfer in Cheryl Pierce's bankruptcy proceedings.

Appellants contend that the lack of a signature on the stock certificates, while the parties

acted as if the certificates were signed, was a type of fraud. The 2023 complaint is also

based on fraudulent transfer (or attempted transfer) of "preferred" shares of stock to

Denise and to another sister, Jeannie Parker, shares that were discovered to be worthless

as early as 2012.

{¶48} Appellants try to use the discovery rule which applies to discovery of factual

matters, to somehow apply to their discovery of legal theories once they learned of the

steps necessary to effectuate a gift of stock shares. Appellants argue that they were

ignorant of the details of the board meeting that happened in December of 2010 where

the stock was purportedly transferred from Gerald and Lois to Appellants’ siblings until

Case No. 25 CO 0005 – 21 –

they obtained new information in 2020 and began additional discovery through their 2021

lawsuit. Appellants claim they then discovered the stock certificates were not signed, and

thus, they now believe no real transfer of ownership took place. Appellants argue that

they initially believed Appellees’ fraudulent action was in transferring the stock, but since

2020 they now believe the fraud was in failing to actually transfer the stock while acting

as if they had ownership of the company. Appellants explain that these additional details

allowed them to frame a new complaint in 2023 with better legal theories.

{¶49} Whether or not these allegations are true is irrelevant to the trial court's

decision as to the statute of limitations. Appellees’ exploration of an additional claim of

fraud does not change the factual basis of the fraud, only the legal theory of recovery.

"[T]he discovery rule applies to the 'discovery of facts, not to the discovery of what the

law requires.' (Emphasis deleted.) Lynch v. Dial Finance Co. of Ohio No. 1, Inc. (1995),

101 Ohio App.3d 742, 747, 656 N.E.2d 714." Koe-Krompecher v. City of Columbus,

2005-Ohio-6504, ¶ 15 (10th Dist.). Appellants admittedly knew or should have known by

2014 and earlier the facts that cause them to assert a fraud was taking place, and that

fraud forms the basis of their IIEI tort, as well as the other counts in the complaint. The

endorsement or lack of endorsement on stock certificates raises an interesting legal

question, but does not support a new factual basis on which to review the relevant statute

of limitations question under the facts of this case.

{¶50} The trial court conducted the correct analysis based on the undisputed

evidence in the record to conclude that Appellants knew or should have known of the

tortious activity that underlies all of their claims no later than 2014. Any complaint, then,

was required to be filed by 2018. Appellants’ complaint was filed in 2023. Although our

review is de novo, it is based only on what was actually in front of the trial court, including

Case No. 25 CO 0005 – 22 –

the arguments that were made there. Appellants' argument to the trial court was that the

essential character of all of their claims was fraud. There is no genuine issue of material

fact raised by the evidence and there is no question Appellants failed to satisfy the four-

year statute of limitations for fraud. Appellants' first assignment of error is without merit

and is overruled.

ASSIGNMENT OF ERROR NO. 2

THE TRIAL COURT'S GRANT OF SUMMARY JUDGMENT IS ERROR

BECAUSE DENISE AND DANNY COULD NOT HAVE BROUGHT A CASE

FOR INTENTIONAL INTERFERENCE WITH EXPECTANCY OF

INHERITANCE CASE PRIOR TO LOIS' DEATH BECAUSE THEY DID

NOT HAVE STANDING TO BRING AN INTENTIONAL INTERFERENCE

WITH INHERITANCE CLAIM AND THE CLAIM WAS NOT RIPE.

{¶51} Appellants claim that the statute of limitations for fraud could not start

running until they had standing to file their intentional interference with an expectancy of

inheritance tort. Appellants cite no law in support of this proposition. Appellants also

claim that such torts are not normally ripe until the death of the decedent from whom the

expectancy arises or until the probate proceedings have been exhausted. Sirak v.

Arenstein, 2011-Ohio-5266, ¶ 52 (5th Dist.); Wickline v. Hoyer, 2012-Ohio-945, ¶ 14 (10th

Dist.). Appellants argue that only their parents had standing to bring an interference with

inheritance claim grounded in fraudulent inducement prior to 2019, while Appellants'

claims only became ripe after 2019, when the second parent died.

{¶52} Ripeness and standing are two distinct legal doctrines. "Ripeness focuses

on whether a case is premature or not yet ready for judicial review. It deals with potential

Case No. 25 CO 0005 – 23 –

or anticipated harms that have not yet fully materialized—whether an asserted harm has

matured sufficiently to warrant judicial intervention." Mundy v. Centrome, Inc., 2024-Ohio-

3358, ¶ 41 (12th Dist.). Standing, on the other hand, determines "whether a litigant is

entitled to have a court determine the merits of the issues presented." Moore v.

Middletown, 2012-Ohio-3897, ¶ 20. "Standing does not depend on the merits of the

plaintiff's claim. Rather, standing depends on whether the plaintiffs have alleged such a

personal stake in the outcome of the controversy that they are entitled to have a court

hear their case." (Citations omitted.) ProgressOhio.org, Inc. v. JobsOhio, 2014-Ohio-

2382, ¶ 7.

{¶53} A statute of limitations is yet another separate issue:

A statute of limitations establishes “a time limit for suing in a civil

case, based on the date when the claim accrued (as when the injury

occurred or was discovered).” Black's Law Dictionary 1707 (11th Ed.2019).

A statute of limitations operates on the remedy, not on the existence of the

cause of action itself.

Wilson v. Durrani, 2020-Ohio-6827, ¶ 9.

{¶54} The purposes of a statute of limitations have been expressed as:

(1) ensuring fairness to the defendant, (2) encouraging prompt

prosecution of causes of action, (3) suppressing stale and fraudulent claims,

and (4) avoiding the inconveniences engendered by delay - specifically, the

difficulties of proof present in older cases.

Doe v. Archdiocese of Cincinnati, 2006-Ohio-2625, ¶ 10.

Case No. 25 CO 0005 – 24 –

{¶55} The mere fact that a statute of limitations is running or might expire does

not give a party standing to sue, nor does an unexpired statute of limitation guarantee

that a claim is ripe for review. Appellants are raising arguments on appeal attempting to

link ripeness, standing, and the statute of limitations for fraud. Appellees respond that

this line of argument has been waived because Appellants did not make this argument in

the trial court. Appellees are correct that new arguments or legal theories cannot be

raised for the first time on appeal. "It is axiomatic that a plaintiff cannot change the theory

of his case and present new arguments for the first time on appeal." Snyder v. Lawrence,

2020-Ohio-3358, ¶ 27 (7th Dist.). New arguments raised for the first time on appeal have

already been waived and should not be addressed. Falcon Drilling Co., LLC v. Omni

Energy Group, LLC, 2024-Ohio-2558, ¶ 80 (7th Dist.); In re Criner, 2001-Ohio-3342 (7th

Dist.).

{¶56} In examining Appellants' various responses to the motions for summary

judgment we have determined that Appellants' line of argument in the trial court was that

they did not understand the true nature of Appellees' fraudulent activities until discovery

took place following the filing of their 2021 complaint. These arguments address the

statute of limitations for fraud and the application of the discovery rule. Appellants never

argued that it was impossible to file a lawsuit earlier than 2019 due to some lack of

standing or lack of ripeness. They simply sought to delay the initial date for running the

discovery rule began until 2019 when Lois died (or until 2021, when they uncovered

stronger legal arguments).

{¶57} Appellants' new assertion on appeal that they could not have filed any

actions against the various Appellees until Lois's death in 2019 due to lack of standing or

lack of ripeness does not survive even a superficial scrutiny. There were fraud claims

Case No. 25 CO 0005 – 25 –

that could have been brought as early as 2010 since Denise was, or believed herself to

be, a preferred shareholder of YCC in 2010 and holder of common shares in 2012.

Further, if Appellants were alerted they had an expectancy of inheritance on or before

2014 (which is what both admitted in their deposition testimony) they could have filed an

IIEI suit, since IIEI does not require proof that the expectancy has vested. Brown v.

Ralston, 2016-Ohio-4916, ¶ 20 (7th Dist.). The reality is that Appellants did not attempt

to discover the full details of the alleged fraud or preserve any cause of action for fraud

at the time they learned of it. Whether they had standing or whether their claims were

ripe, and how those issues might overlap with application of the statute of limitations for

fraud, are separate discussions that were not raised at the trial court level. Appellants'

second assignment of error has been waived and is overruled.

ASSIGNMENT OF ERROR NO. 3

COUNTS 8 AND 9 SHOULD NOT HAVE BEEN BARRED BY THE

STATUTE OF LIMITATIONS BECAUSE TOGETHER THE COUNTS SEEK

TO REDRESS CONVERSION OF SHARES, CAPITAL ACCOUNT AND

ATTRIBUTABLE DISTRIBUTIONS THAT TOOK PLACE IN 2019 AND

2020 AND THE CAUSES WERE FILED WITHIN THE 4 YEAR STATUTE

OF LIMITATIONS.

{¶58} Appellants argue that counts eight and nine of the complaint were

alternative to the other claims and should not have been dismissed as dependent on the

survival of the first seven claims. Appellants, oddly, begin their argument by saying that

counts eight and nine are contingent on the court rendering factual findings that arise

from the first seven counts. Appellants argue that, if the court makes a finding on the

Case No. 25 CO 0005 – 26 –

validity of a 2010 stock transfer to Sandra Kelly Hughes, it can then rule on counts eight

and nine. Since the court dismissed the first seven counts due to the expiration of the

statute of limitations, it was not required to make any advisory findings arising out of those

counts, including findings as to fraud or conversion regarding a 2010 stock transfer. In

fact, such findings would be impermissible. This is in essence what the trial court held in

its supplemental judgment entry of April 30, 2025, although the court expressed dismissal

of the claims in the alternative: either they are moot, or they also are barred by the

expiration of the statute of limitations.

{¶59} The trial court's supplemental judgment entry points out that count eight is

premised on the court ruling on one or more of the first seven counts of the complaint.

Count one in particular seeks for the court to rule on the validity of the Appellant Denise's

preferred stock, the validity of the transfer of common stock to Sandra Kelly Hughes, the

validity of the transfer of stock from Sandra Kelly Hughes to Denise, as well as the validity

of various persons acting as owners of YCC by virtue of their ownership of its common

stock. Since count one was dismissed due to the expiration of the statute of limitations,

the trial court correctly declined to make any findings related to that count, and the

derivative count eight fails as well.

{¶60} Count nine is likewise dependent on the trial court making a finding from

count one that Sandra Kelly Hughes was the rightful owner of common stock in 2010 and

that Denise rightfully purchased half those shares for $1 in 2014. Count nine is also

specifically linked to the fraud claim in count two. Since counts one and two have been

dismissed, count nine cannot survive.

{¶61} Nevertheless, Appellants put forward the same argument here that they

made in their second assignment of error: that they had no standing to bring an action

Case No. 25 CO 0005 – 27 –

regarding the 2010 stock transfer until 2020 or later when Denise discovered she was not

being paid dividends on the stock. Denise argues that she believed Sandra Kelly Hughes

was given 375 shares of common stock in 2010, that Sandra Kelly Hughes sold half of

those shares to Denise in 2014, and that both Appellants found out in 2020 that the

transfer of stock to Sandra Kelly Hughes in 2010 was not properly executed. Despite

these allegations, Appellants argue that if Sandra Kelly Hughes did own the stock in 2010,

then Appellant Denise should have been receiving dividends since 2014, and she had

standing to make a claim for unpaid dividends beginning in 2020.

{¶62} As Appellees point out, Appellants simply disregard the statute of limitations

in this argument. Appellants knew about the 2010 stock transfers at the time they

happened. Appellant Denise was aware her preferred shares were worthless and would

not receive dividends at the time she received the shares. She knew the questionable

nature of her purchase of Sandra Kelly Hughes' common stock for $1 when she

purchased the stock in 2014. Denise's failure to examine whether the stock she was

purchasing was actually signed not only impacts her statute of limitations argument, it

negates the cause of action for fraud altogether. "The failure to read the terms of a

contract 'drives a stake into the heart' of a fraud claim." Fertilizer Storage Co., LLC v.

Heartland Bank, 2024-Ohio-4836, ¶ 16 (3d Dist.). The facts that were available to

Appellants from 1990 through 2014 triggered the running of any statute of limitations

Appellants seek to rely upon. The statute of limitations for fraud is the one raised in the

trial court and the one that was relied on by the trial court. This statute ran out in 2018,

precluding Appellants from any recovery for acts arising from all alleged fraudulent activity

regarding the YCC stock.

Case No. 25 CO 0005 – 28 –

{¶63} We agree with the trial court that counts eight and nine became moot once

the first seven counts were dismissed due to the statute of limitations. Appellants' third

assignment of error is unpersuasive and is overruled. Hence, the judgment of the trial

court in this matter is affirmed in total.

Conclusion

{¶64} Appellants raise three arguments on appeal challenging the decision to

grant summary judgment to Appellees in this matter. They argue that the trial court did

not correctly apply the reasonable person standard in applying the discovery rule. They

claim that a reasonable person would not have discovered the fraud they allege until

2019, and using that date, the statute of frauds had not expired when they filed their 2023

complaint. However, the trial court correctly relied on the "knew or should have known"

standard of the discovery rule. The record reveals that Appellants knew or should have

known the full extent of the fraud they believe underlies all their causes of action by at

least 2014, and applying the discovery rule to that date, they had until 2018 to timely file

their complaint, which was not filed until 2023. Appellants also argue that the statute of

limitations for fraud did not begin to run until they had standing to file an IIEI action in

2019 when their mother Lois died, or until their case became ripe. Standing and ripeness

are distinct legal concepts, and their relationship to the statute of limitations for fraud was

not raised in the trial court proceedings, and so are waived on appeal. Finally, Appellants

argue that counts eight and nine of the complaint should not have been dismissed

because they were independent of the other counts. The record shows that counts eight

and nine were clearly dependent on the court making particular findings in counts one

and two, and because those counts were properly dismissed due to the statute of

Case No. 25 CO 0005 – 29 –

limitations, the court dismissed counts eight and nine as moot. The court correctly

granted summary judgment to Appellees, and the judgment is affirmed.

Hanni, J. concurs.

Dickey, J. concurs.

Case No. 25 CO 0005 [Cite as Rutan v. Kelly, 2025-Ohio-4765.]

For the reasons stated in the Opinion rendered herein, Appellants’ assignments of

error are overruled and it is the final judgment and order of this Court that the judgment

of the Court of Common Pleas of Columbiana County, Ohio, is affirmed. Costs to be

taxed against the Appellants.

A certified copy of this opinion and judgment entry shall constitute the mandate in

this case pursuant to Rule 27 of the Rules of Appellate Procedure. It is ordered that a

certified copy be sent by the clerk to the trial court to carry this judgment into execution.

NOTICE TO COUNSEL

This document constitutes a final judgment entry.