[Cite as Shalash v. Shalash, 2014-Ohio-3317.]
COURT OF APPEALS DELAWARE COUNTY, OHIO FIFTH APPELLATE DISTRICT
IMAN SHALASH : JUDGES: : Hon. William B. Hoffman, P.J. Plaintiff-Appellee : Hon. Sheila G. Farmer, J. : Hon. John W. Wise, J. -vs- : : HATEM SHALASH, ET AL. : Case No. 14 CAF 02 0014 : Defendants-Appellants : OPINION :
CHARACTER OF PROCEEDING: Appeal from the Court of Common Pleas, Domestic Relations Division, Case No. 10 DRA 03 140
JUDGMENT: Reversed and Remanded
DATE OF JUDGMENT: July 28, 2014
APPEARANCES:
For Plaintiff-Appellee For Defendants-Appellants:
ROBERT C. PETTY RONALD B. NOGA 270 Bradenton Avenue 1010 Old Henderson Road Suite 100 Suite 1 Dublin, OH 43017 Columbus, OH 43220 Delaware County, Case No. 14 CAF 02 0014 2
Farmer, J.
{¶1} On June 23, 1995, Hatem Shalash and appellee, Iman Shalash, were
married. On March 16, 2010, appellee filed a complaint for divorce.
{¶2} Mr. Shalash owned a corporation, 1925 Express Business, Inc. In 2007,
the corporation had purchased a drive thru for approximately $200,000.00. On March
23, 2010, Mr. Shalash sold 1925 Express Business for approximately $56,500.00 to his
mother, appellant, Fatheih Shalash. Appellant-mother formed a corporation named
Satsha Express, Inc., another appellant herein. Both appellants were named
defendants in the divorce action.
{¶3} Hearings on the divorce complaint were held in June 2012. By judgment
entry filed June 11, 2012, the trial court found the sale of 1925 Express Business was a
sham transaction and the new business entity known as Satsha Express was a marital
asset, and ordered appellant-mother to hold the business in a constructive trust for the
parties. By judgment entry filed June 19, 2012, the trial court found fifty percent of the
proceeds from a $60,000.00 sale of another business, Frebis Beer Dock, Inc., sold by
Mr. Shalash and his brother to appellant-mother in 2011 in violation of a restraining
order, constituted a marital asset to be divided between the parties. The trial court
ordered appellant-mother to place Mr. Shalash's share into a separate bank account,
distribution of which was subject to a final decree of divorce.
{¶4} By judgment entry decree of divorce filed October 18, 2012, the trial court
found Mr. Shalash engaged in financial misconduct and assigned to him all of the
marital debt. The trial court also ordered distribution to appellee of the funds in the bank
account from the Frebis Beer Dock sale. In a separate judgment entry filed same date, Delaware County, Case No. 14 CAF 02 0014 3
the trial court reiterated its decision of June 11, 2012, that the sale of 1925 Express
Business was a sham transaction and the new business entity was a marital asset, and
ordered appellant-mother to transfer the business known as Satsha Express, Inc. to
appellee by November 1, 2012. The transfer included all equipment, fixtures, inventory,
and rights to existing liquor permits, but not any debts or liabilities. Mr. Shalash was
granted thirty percent of the net profits of which any tax assessments against Satsha
Express were to be paid.
{¶5} Appellants filed an appeal. This court reversed the case, finding the trial
court was correct in finding financial misconduct on the part of Mr. Shalash, but erred in
vacating the sale of 1925 Express Business and ordering the business and liquor
license transfers from appellant-mother to appellee. The trial court instead should have
considered the value of the business as a marital asset and awarded appellee a
distributive award or a greater share of the marital property. Shalash v. Shalash, 5th
Dist. Delaware No. 12 CAF 11 0079, 2013-Ohio-5064.
{¶6} Upon remand, the trial court issued an amended judgment entry decree of
divorce on January 24, 2014, finding the business value to be $56,500.00, and awarded
said amount to appellee. The trial court ordered appellant-mother to pay her monthly
payment to appellee until the sale price was paid in full. Any down payment and
monthly payments previously paid to Mr. Shalash shall be deducted from the value and
shall be paid by Mr. Shalash to appellee. If appellant-mother failed to provide
documentation of paying the down payment and any monthly payments to Mr. Shalash,
she was to pay the amounts to appellee. Delaware County, Case No. 14 CAF 02 0014 4
{¶7} Appellants filed an appeal and this matter is now before this court for
consideration. Assignment of error is as follows:
I
{¶8} "THE DOMESTIC RELATIONS COURT'S ORDER CREATING A NEW
PERSONAL OBLIGATION BETWEEN APPELLANT AND PLAINTIFF'S WIFE BELOW
WAS OUTSIDE THE JURISDICTION OF THE DIVISION OF DOMESTIC RELATIONS
AS IT DETERMINES A COLLATERAL CLAIM AND THE RIGHTS OF A THIRD
PARTY."
{¶9} Appellant-mother claims the trial court erred in creating a new obligation
between her and appellee. We agree.
{¶10} In Shalash v. Shalash, 5th Dist. Delaware No. 12 CAF 11 0079, 2013-
Ohio-5064, ¶ 29, this court found the following:
Under R.C. 3105.171(E)(4), the trial court has two remedies to
compensate a spouse for the other spouse's financial misconduct: (1) a
distributive award or (2) a greater award of marital property. 1925
Express Business, Inc. was a marital asset through which Husband
engaged in financial misconduct in disposing of that asset via sale to his
Mother. Pursuant to the guidance of Albaugh [v. Albaugh, 10th Dist.
Franklin No. 81AP-637, 1982 WL 4296 (July 22, 1982)] and the limitations
of R.C. 3105.171(E)(4), we find the trial court, in compensating Wife for
Husband's financial misconduct, should have considered the value of Delaware County, Case No. 14 CAF 02 0014 5
1925 Express Business, Inc. as part of the marital estate, rather than
vacating the sale of the business and granting Wife the ownership of the
business. Ordering the transfer of the business from Mother to Wife was
an inappropriate extension of the trial court's authority in this case
because the court had alternative remedies to utilize, such as the
application of the financial misconduct statute. The trial court could award
Wife a distributive award or a greater award of marital property from the
total marital estate.
{¶11} Upon remand, the trial court issued an amended judgment entry decree of
divorce on January 24, 2014, finding the following:
The Court determines that despite the transfer of this business to
Co-Defendant, the value of the business shall be considered a marital
asset. Accordingly, as noted supra, the Court issued a restraining order
barring the Co-Defendant from disposing of any of the assets of the
business until further order of the Court.
The Court determines the value of the business to be $56,500.
Due to the financial misconduct of the Defendant, the Court awards the
entire value of this business asset to the Plaintiff Iman Shalash.
Testimony revealed that the Co-Defendant was supposed to have paid the
Defendant a down payment of $5000 and $1000 per month until the Delaware County, Case No. 14 CAF 02 0014 6
purchase price was paid in full. The restraining order of June 11, 2012
prohibited the Co-Defendant from paying any monies to the Defendant.
Therefore the Court orders the Co-Defendant to pay the $1000 per
month payments to the Plaintiff Iman Shalash until the business sale price
is paid in full.
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[Cite as Shalash v. Shalash, 2014-Ohio-3317.]
COURT OF APPEALS DELAWARE COUNTY, OHIO FIFTH APPELLATE DISTRICT
IMAN SHALASH : JUDGES: : Hon. William B. Hoffman, P.J. Plaintiff-Appellee : Hon. Sheila G. Farmer, J. : Hon. John W. Wise, J. -vs- : : HATEM SHALASH, ET AL. : Case No. 14 CAF 02 0014 : Defendants-Appellants : OPINION :
CHARACTER OF PROCEEDING: Appeal from the Court of Common Pleas, Domestic Relations Division, Case No. 10 DRA 03 140
JUDGMENT: Reversed and Remanded
DATE OF JUDGMENT: July 28, 2014
APPEARANCES:
For Plaintiff-Appellee For Defendants-Appellants:
ROBERT C. PETTY RONALD B. NOGA 270 Bradenton Avenue 1010 Old Henderson Road Suite 100 Suite 1 Dublin, OH 43017 Columbus, OH 43220 Delaware County, Case No. 14 CAF 02 0014 2
Farmer, J.
{¶1} On June 23, 1995, Hatem Shalash and appellee, Iman Shalash, were
married. On March 16, 2010, appellee filed a complaint for divorce.
{¶2} Mr. Shalash owned a corporation, 1925 Express Business, Inc. In 2007,
the corporation had purchased a drive thru for approximately $200,000.00. On March
23, 2010, Mr. Shalash sold 1925 Express Business for approximately $56,500.00 to his
mother, appellant, Fatheih Shalash. Appellant-mother formed a corporation named
Satsha Express, Inc., another appellant herein. Both appellants were named
defendants in the divorce action.
{¶3} Hearings on the divorce complaint were held in June 2012. By judgment
entry filed June 11, 2012, the trial court found the sale of 1925 Express Business was a
sham transaction and the new business entity known as Satsha Express was a marital
asset, and ordered appellant-mother to hold the business in a constructive trust for the
parties. By judgment entry filed June 19, 2012, the trial court found fifty percent of the
proceeds from a $60,000.00 sale of another business, Frebis Beer Dock, Inc., sold by
Mr. Shalash and his brother to appellant-mother in 2011 in violation of a restraining
order, constituted a marital asset to be divided between the parties. The trial court
ordered appellant-mother to place Mr. Shalash's share into a separate bank account,
distribution of which was subject to a final decree of divorce.
{¶4} By judgment entry decree of divorce filed October 18, 2012, the trial court
found Mr. Shalash engaged in financial misconduct and assigned to him all of the
marital debt. The trial court also ordered distribution to appellee of the funds in the bank
account from the Frebis Beer Dock sale. In a separate judgment entry filed same date, Delaware County, Case No. 14 CAF 02 0014 3
the trial court reiterated its decision of June 11, 2012, that the sale of 1925 Express
Business was a sham transaction and the new business entity was a marital asset, and
ordered appellant-mother to transfer the business known as Satsha Express, Inc. to
appellee by November 1, 2012. The transfer included all equipment, fixtures, inventory,
and rights to existing liquor permits, but not any debts or liabilities. Mr. Shalash was
granted thirty percent of the net profits of which any tax assessments against Satsha
Express were to be paid.
{¶5} Appellants filed an appeal. This court reversed the case, finding the trial
court was correct in finding financial misconduct on the part of Mr. Shalash, but erred in
vacating the sale of 1925 Express Business and ordering the business and liquor
license transfers from appellant-mother to appellee. The trial court instead should have
considered the value of the business as a marital asset and awarded appellee a
distributive award or a greater share of the marital property. Shalash v. Shalash, 5th
Dist. Delaware No. 12 CAF 11 0079, 2013-Ohio-5064.
{¶6} Upon remand, the trial court issued an amended judgment entry decree of
divorce on January 24, 2014, finding the business value to be $56,500.00, and awarded
said amount to appellee. The trial court ordered appellant-mother to pay her monthly
payment to appellee until the sale price was paid in full. Any down payment and
monthly payments previously paid to Mr. Shalash shall be deducted from the value and
shall be paid by Mr. Shalash to appellee. If appellant-mother failed to provide
documentation of paying the down payment and any monthly payments to Mr. Shalash,
she was to pay the amounts to appellee. Delaware County, Case No. 14 CAF 02 0014 4
{¶7} Appellants filed an appeal and this matter is now before this court for
consideration. Assignment of error is as follows:
I
{¶8} "THE DOMESTIC RELATIONS COURT'S ORDER CREATING A NEW
PERSONAL OBLIGATION BETWEEN APPELLANT AND PLAINTIFF'S WIFE BELOW
WAS OUTSIDE THE JURISDICTION OF THE DIVISION OF DOMESTIC RELATIONS
AS IT DETERMINES A COLLATERAL CLAIM AND THE RIGHTS OF A THIRD
PARTY."
{¶9} Appellant-mother claims the trial court erred in creating a new obligation
between her and appellee. We agree.
{¶10} In Shalash v. Shalash, 5th Dist. Delaware No. 12 CAF 11 0079, 2013-
Ohio-5064, ¶ 29, this court found the following:
Under R.C. 3105.171(E)(4), the trial court has two remedies to
compensate a spouse for the other spouse's financial misconduct: (1) a
distributive award or (2) a greater award of marital property. 1925
Express Business, Inc. was a marital asset through which Husband
engaged in financial misconduct in disposing of that asset via sale to his
Mother. Pursuant to the guidance of Albaugh [v. Albaugh, 10th Dist.
Franklin No. 81AP-637, 1982 WL 4296 (July 22, 1982)] and the limitations
of R.C. 3105.171(E)(4), we find the trial court, in compensating Wife for
Husband's financial misconduct, should have considered the value of Delaware County, Case No. 14 CAF 02 0014 5
1925 Express Business, Inc. as part of the marital estate, rather than
vacating the sale of the business and granting Wife the ownership of the
business. Ordering the transfer of the business from Mother to Wife was
an inappropriate extension of the trial court's authority in this case
because the court had alternative remedies to utilize, such as the
application of the financial misconduct statute. The trial court could award
Wife a distributive award or a greater award of marital property from the
total marital estate.
{¶11} Upon remand, the trial court issued an amended judgment entry decree of
divorce on January 24, 2014, finding the following:
The Court determines that despite the transfer of this business to
Co-Defendant, the value of the business shall be considered a marital
asset. Accordingly, as noted supra, the Court issued a restraining order
barring the Co-Defendant from disposing of any of the assets of the
business until further order of the Court.
The Court determines the value of the business to be $56,500.
Due to the financial misconduct of the Defendant, the Court awards the
entire value of this business asset to the Plaintiff Iman Shalash.
Testimony revealed that the Co-Defendant was supposed to have paid the
Defendant a down payment of $5000 and $1000 per month until the Delaware County, Case No. 14 CAF 02 0014 6
purchase price was paid in full. The restraining order of June 11, 2012
prohibited the Co-Defendant from paying any monies to the Defendant.
Therefore the Court orders the Co-Defendant to pay the $1000 per
month payments to the Plaintiff Iman Shalash until the business sale price
is paid in full. Attorney Ronald Noga is ordered to pay to the Plaintiff Iman
Shalash all monies deposited into his trust account by Co-Defendant
which shall be credited against the purchase price of the business.
If the Co-Defendant fails to present any documentation that she
actually transferred the $5000 down payment together with any monthly
payments to the Defendant before the June 11, 2012 restraining order, the
Co-Defendant shall be required to pay this amount and all monthly
amounts due to the Plaintiff Iman Shalash. If the Co-Defendant can
substantiate that she paid the $5000 and any monthly payments directly to
the Defendant before the June 11, 2012 restraining order, the $5000 and
any paid monthly payments paid directly to Defendant shall be deducted
from the value of the business (i.e. $56,500). All deducted amounts shall
constitute an additional sum due from the Defendant to the Plaintiff Iman
Shalash as part of the marital property division.
{¶12} Appellant-mother argues she cannot be personally liable to appellee as
the cognovit promissory note dated April 25, 2010 involving 1925 Express Business,
attached to appellants' brief, obligates Satsha Express, Inc. only. We agree. As
conceded by appellants in their brief at 5, the trial court could award the cognovit Delaware County, Case No. 14 CAF 02 0014 7
promissory note to appellee directly. The trial court could also order Satsha Express to
make the ordered payments to appellee instead of appellant-mother, as Satsha
Express, Inc. was a party-defendant to the case. See, Amended Complaint filed
October 8, 2010.
{¶13} In her brief at 3, appellant-mother also challenges the trial court's
determination on another business, Frebis Beer Dock. The trial court's decision in its
January 24, 2014 amended judgment entry decree of divorce on this business is
identical, word for word, to the trial court's determination in its judgment entry decree of
divorce filed October 18, 2012. Appellants appealed the October 18, 2012 judgment
entry decree of divorce, but failed to assign this determination as error. We find the
doctrine of res judicata applies sub judice: "[a] valid, final judgment rendered upon the
merits bars all subsequent actions based upon any claim arising out of the transaction
or occurrence that was the subject matter of the previous action." Grava v. Parkman
Twp., 73 Ohio St.3d 379, 1995-Ohio-331, syllabus.
{¶14} This matter is remanded to the trial court to either award the cognovit
promissory note to appellee directly or order Satsha Express, Inc. to make the ordered
payments to appellee.
{¶15} The sole assignment of error is granted. Delaware County, Case No. 14 CAF 02 0014 8
{¶16} The judgment of the Court of Common Pleas of Delaware County, Ohio,
Domestic Relations Division is hereby reversed.
By Farmer, J.
Hoffman, P.J. and
Wise, J. concur.
SGF/sg 715