Siniscalchi v. K. Hovnanian Meadow Lakes, L.L.C.

• Court: Ohio Court of Appeals
• Decided: May 14, 2026
• Docket: 115700
• Status: Published

Opinion

[Cite as Siniscalchi v. K. Hovnanian Meadow Lakes, L.L.C., 2026-Ohio-1777.]

COURT OF APPEALS OF OHIO

EIGHTH APPELLATE DISTRICT COUNTY OF CUYAHOGA

SHANE SINISCALCHI, ET AL., :

Plaintiffs-Appellants, : No. 115700 v. :

K. HOVNANIAN MEADOW LAKES, : LLC, ET AL.,

Defendants-Appellees. :

JOURNAL ENTRY AND OPINION

JUDGMENT: REVERSED AND REMANDED RELEASED AND JOURNALIZED: May 14, 2026

Civil Appeal from the Cuyahoga County Court of Common Pleas Case No. CV-25-112609

Appearances:

Fortney Law, LLC and Michael R. Fortney, for appellants.

Dworken & Bernstein Co., L.P.A. and Richard N. Selby, II, for appellees.

EILEEN A. GALLAGHER, J.:

Shane Siniscalchi and Eric Velazquez (“Buyers”) appeal the trial

court’s dismissal of their complaint against K. Hovnanian Meadow Lakes, LLC and

K. Hovnanian Companies, LLC (“Builder”) for spoliation of evidence and the court’s awarding Builder sanctions and attorney fees against Buyers in the amount of

$11,762.50. For the reasons that follow, we reverse the trial court’s judgments and

remand this case for further proceedings consistent with this opinion.

I. Facts and Procedural History

On September 1, 2020, Buyers and Builder entered into a contract in

which Buyers agreed to buy and Builders agreed to build and sell a house located at

6911 Hatching Way in North Ridgeville, Ohio (the “Property”). Buyers took

possession of the Property in April 2021 and, at that time, issues arose concerning

lack of drainage in the backyard and water infiltration into the basement.

On March 21, 2022, Buyers’ attorney sent notice to Builder of

potential litigation should Builder not resolve the water-drainage issue.

On June 6, 2022, Buyers filed a complaint in the Lorain County

Common Pleas Court alleging breach of contract, violations of R.C. Ch. 4722, fraud,

violations of Ohio’s Racketeering Influenced and Corrupt Organizations statute and

civil conspiracy. See Siniscalchi v. K. Hovnanian Meadow Lakes, LLC, Lorain

County C.P. No. 22CV206129 (the “Lorain County case”). The Lorain County case

went to binding arbitration in January 2024. This in-person arbitration took place

in Cleveland, Ohio. On May 1, 2024, the arbitrator found in favor of Buyers on the

breach-of-contract claim only and issued an award in the amount of $33,214.83.

The arbitrator further found that Buyers’ remaining claims failed because,

essentially, they did not prove that Builder intended to mislead them. Buyers filed

a motion to vacate or modify the arbitration award in the Lorain County case, which was denied by the trial court. Additionally, the trial court in the Lorain County case

found that Buyers “engaged in frivolous conduct in the filing of their Motion to

Vacate” and awarded $9,878.70 in legal fees and costs in favor of Builder and against

Buyers.

On February 24, 2025, Buyers filed another complaint against

Builder, this time in the Cuyahoga County Common Pleas Court, alleging spoliation

of evidence and fraud. On May 9, 2025, Buyers filed an amended complaint alleging

only spoliation of evidence. Buyer’s amended complaint is the basis of this appeal.

The gist of Buyer’s claim is that Builder failed to produce, and in fact deleted or

destroyed, emails and text messages during discovery in the Lorain County case.

According to Buyers, this evidence would have shown that Builder intended to

mislead Buyers about the drainage and water issues at the Property. Buyers further

alleged that Builder “cited a supposed policy calling for deletion of all emails,

company-wide, after one year,” but Builder failed to produce evidence of this during

the Lorain County case. Buyers also alleged that Builder’s “policy directly conflicts

with Ohio law relative to spoliation of evidence.”

On May 20, 2025, Builder filed a motion to dismiss for failure to state

a claim upon which relief can be granted pursuant to Civ.R. 12(B)(6), arguing two

points: first, “Buyers have not alleged the requisite elements of the [spoliation]

claim”; and second, Buyers’ claim was barred by the doctrine of res judicata.

Builder’s motion to dismiss additionally requested that the court award sanctions

against Buyers for frivolous conduct under Civ.R. 11 and R.C. 2323.51. On July 29, 2025, the trial court issued a journal entry granting

Builder’s motion to dismiss the spoliation claim based on res judicata. Relevant to

this case, the court’s journal entry cited footnote one of the arbitration award, which

addressed why Buyers’ claims in the Lorain County case, other than breach of

contract, failed. The footnote states, in part, as follows:

[Buyers] attempt to remedy the missing elements of knowledge of falsity and intent to mislead [by] contend[ing] that [Builder] should be subject to a claim for spoliation of evidence or an adverse inference as to missing evidence. No claim for spoliation of evidence was alleged in the [complaint]. Furthermore, the necessary elements have not been established . . . . At the very least, there is no proof of willful destruction of evidence.

An adverse inference would not be appropriate either. . . . Here, [Builder] explained the policy relating to deletion of emails and texts thereby properly accounting for the documentary evidence questioned.

(Emphasis added.)

The court’s journal entry dismissing the spoliation claim made the

following findings:

On 05/01/24, the arbitrat[or] concluded that [Buyers’] claims for spoliation failed [and] the necessary elements have not been established.

...

Pursuant to Lycan [v. Cleveland], 2022-Ohio-4676, this court concludes as follows:

(1) A prior final, valid decision on the merits of [Buyers’] claims of spoliation was issued [in the Lorain County case by] a court of competent jurisdiction, and by confirmation of arbitration . . . ; (2) A second action, which is the instant case, involving the same parties, or their privies, as the first was field and is currently pending before this court;

(3) This second action raises claims of spoliation that were or could have been litigated in the first action; and,

(4) This second action arises out of the transaction or occurrence that was the subject matter of the previous action.

This court further concluded that the claims of spoliation which [Buyers] bring[] before this court in their first amended counterclaim [sic], filed 05/09/25, are barred by res judicata, as these claims have already been fully litigated in [the Lorain County case], and in a prior arbitration ordered by [the] court [in the Lorain County case].

Therefore, this case is dismissed.

On September 12, 2025, after a hearing, the court granted Builder’s

unopposed motion for sanctions, finding that Buyers’ filing of this spoliation case

“despite the failure of [Buyers’] spoliation claims [in the Lorain County case] rise[s]

to the level of egregious conduct.” The court awarded Builder $11,762.50 in attorney

fees and costs.

Buyers appeal from these two journal entries raising the following

assignments of error.

I. The trial court erred when it determined that the principle of res judicata bars Appellants’ spoliation claim.

II. The trial court erred when it dismissed Appellants’ claim.

III. The trial court erred when it awarded attorney’s fees to Appellees. II. Law and Analysis

A. Motion to Dismiss and Res Judicata

1. Motion to Dismiss for Failure to State a Claim Upon Which Relief Can be Granted

Appellate courts review a trial court’s ruling on a Civ.R. 12(B)(6)

motion to dismiss under a de novo standard. Hersh v. Grumer, 2021-Ohio-2582,

¶ 5. “A motion to dismiss for failure to state a claim upon which relief can be granted

is procedural and tests the sufficiency of the complaint . . . . Under a de novo analysis,

we must accept all factual allegations of the complaint as true and all reasonable

inferences must be drawn in favor of the nonmoving party.” NorthPoint Props. v.

Petticord, 2008-Ohio-5996, ¶ 11 (8th Dist.). A motion to dismiss under Civ.R.

12(B)(6) “can only be granted when it appears beyond doubt from the complaint that

the plaintiff can prove no set of facts entitling her to relief.” Grey v. Walgreen Co.,

2011-Ohio-6167, ¶ 3 (8th Dist.). See also State ex rel. Scott v. Cleveland, 2006-Ohio-

6573, ¶ 26 (A “Civ.R. 12(B)(6) determination cannot rely on factual allegations or

evidence outside the complaint . . . .” (Emphasis in original.)).

Pursuant to Civ.R. 8(A), a cause of action in a complaint “shall contain

(1) a short and plain statement of the claim showing that the party is entitled to relief,

and (2) a demand for judgment for the relief to which the party claims to be entitled.”

2. Res Judicata

Whether a trial court erred by applying the doctrine of res judicata is

a question of law that appellate courts review de novo without deference to a trial

court’s decision. Lycan, 2022-Ohio-4676, at ¶ 21. “Res judicata bars a party from relitigating a claim or issue that has already been decided on the merits by a court of

competent jurisdiction in a valid, final judgment in a prior proceeding.” Fast Tract

Title Servs. v. Barry, 2024-Ohio-5216, ¶ 21 (8th Dist.). This court has held that a

claim is barred by res judicata “when the following four elements are met: (1) there

is a final, valid decision on the merits by a court of competent jurisdiction; (2) there

is a second action that involves the same parties, or their privies, as the first action;

(3) the second action raises claims that were or could have been litigated in the first

action; and (4) the second action arises out of a transaction or occurrence that was

the subject matter of the first action.” Daniel v. Shorebank Cleveland, 2010-Ohio-

1054, ¶ 13 (8th Dist.).

3. Res Judicata May Not be Raised in Civ.R. 12(B) Motions to Dismiss

In Jefferson v. Bunting, 2014-Ohio-3074, ¶ 10, the Ohio Supreme

Court held as follows: “Res judicata is an affirmative defense. Civ.R. 8(C). It is not

included in the list of defenses that may be raised in a Civ.R. 12(B) motion to dismiss.

For this reason, we have held that res judicata is not a proper basis for dismissal

under Civ.R. 12.” See also State ex rel. Freeman v. Morris, 62 Ohio St.3d 107, 109

(1991) (“[T]he defense of res judicata may not be raised by motion to dismiss under

Civ.R. 12 (B).”). “The Freeman rule is consistent with the general proposition that

courts cannot rely on evidence or allegations outside the complaint to decide a Civ.R.

12(B)(6) motion to dismiss.” Jefferson at ¶ 11. 4. Analysis

Upon review, we find that the trial court erred by dismissing this case

pursuant to a Civ.R. 12(B)(6) motion to dismiss both under the doctrine of res

judicata and for failure to state a claim upon which relief can be granted.

It is well-established that res judicata is not a proper basis for

dismissal under Civ.R. 12(B)(6). See Jefferson and Freeman. Additionally, the

doctrine of res judicata does not bar Buyers’ spoliation claim in this case because the

first prong of the res judicata test cannot be met. Specifically, there was no previous

final judgment on the merits of a spoliation claim because, according to the

arbitrator’s award that was attached to Buyers’ amended complaint, no spoliation

claim was brought in the Lorain County case.

To the extent that Builder’s motion to dismiss is based on failure to

state a claim upon which relief can be granted — notwithstanding res judicata — we

review the allegations of spoliation of evidence in the amended complaint.

In Smith v. Howard Johnson Co., 67 Ohio St.3d 28, 29 (1993), the

Ohio Supreme Court set forth the elements of a spoliation of evidence claim: “(1)

pending or probable litigation involving the plaintiff, (2) knowledge on the part of

defendant that litigation exists or is probable, (3) willful destruction of evidence by

defendant designed to disrupt the plaintiff’s case, (4) disruption of the plaintiff’s

case, and (5) damages proximately caused by the defendant’s acts . . . .”

Upon review of Buyers’ amended complaint, we find that Buyers

alleged the following regarding spoliation of evidence: As to the first and second elements, Buyers alleged that they sent, and Builder received, notification of

potential litigation in March 2o22. A copy of this written notice is attached to the

amended complaint.

As to the third element, Buyers alleged that Builder “intentionally

destroyed emails [and text messages] in order to disrupt any potential case brought

by” Buyers. Buyers further alleged that Builder “did not provide any emails or text

messages from the time period in question, citing a mysterious policy calling for the

deletion of all text messages and emails, company-wide, after a single year.” A copy

of a two-page document titled “LE014 Physical, Electronic, and Email Document

Retention Policy and Litigation Hold Procedures (revised December 2020)” is

attached to the amended complaint. Buyers also alleged that this document, which

does not refer to the name of Builder or contain any information about the entity to

which this policy applies, was not produced by Builder at all in the Lorain County

case and was only provided to Buyers on March 14, 2025.

As to the fourth element, Buyers alleged that their “case was disrupted

by the destruction of evidence” because the arbitrator concluded Buyers failed to

show “knowledge of falsity and intent to mislead,” which are required elements of

the four unsuccessful claims they alleged. Buyers also contend that these missing

elements could only be shown by the internal communication evidence that Builder

allegedly destroyed. As to the fifth element, Buyers alleged that they were damaged by

Builder’s spoliation of evidence in that they received “an inadequate damages

award” and had to pay Builder’s attorney fees.

Upon review, we find that Buyer’s claim for spoliation of evidence

complies with Civ.R. 8(A) in that it contains “a short and plain statement showing

that [Buyers are] entitled to relief” and a demand for judgment. Furthermore,

accepting all factual allegations as true, as we must under Civ.R. 12(B)(6), Buyers

have asserted a claim for spoliation of evidence that cannot be resolved by a Civ.R.

12(B)(6) motion to dismiss.

Accordingly, the trial court erred by granting Builder’s motion to

dismiss and Buyers’ first and second assignments of error are sustained.

B. Attorney Fees Under R.C. 2323.51

In Buyers’ third assignment of error, they argue that the court erred

when it awarded Builder attorney fees based on a finding that Buyers’ conduct was

frivolous for bringing the spoliation claim. In its September 12, 2025 journal entry

granting Builder’s motion for sanctions and attorney fees, the court found that

Buyers’ conduct was frivolous and sanctionable because their spoliation claim was

“previously addressed by the Lorain Court of Common Pleas and the American

Arbitration Association . . . .” As stated earlier in this opinion, this is not true. The

Lorain County case did not include a claim for spoliation of evidence as noted in the

arbitration award. Because we found that the court erred by dismissing this case,

we also find that Buyers were not frivolous by filing this case as they did not, as a matter of law, previously bring a spoliation claim against Builder. Therefore, the

court erred by awarding Builder attorney fees for Buyers bringing this case.

Accordingly, Buyers’ third assignment of error is sustained.

Judgment reversed and case remanded to the trial court for further

proceedings consistent with this opinion.

It is ordered that appellants recover from appellees 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

common pleas 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.

__________________________ EILEEN A. GALLAGHER, JUDGE

MICHELLE J. SHEEHAN, A.J., and ANITA LASTER MAYS, J., CONCUR