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

Ohio Court of Appeals·Decided May 26, 2026·No. 25CA012324·Published

Opinion

[Cite as Siniscalchi v. K. Hovnanian Meadow Lakes, L.L.C., 2026-Ohio-1911.]

STATE OF OHIO ) IN THE COURT OF APPEALS )ss: NINTH JUDICIAL DISTRICT COUNTY OF LORAIN )

SHANE SINISCALCHI, et al. C.A. No. 25CA012324

Appellants

v. APPEAL FROM JUDGMENT ENTERED IN THE K. HOVNANIAN MEADOW LANES, COURT OF COMMON PLEAS LLC, et al. COUNTY OF LORAIN, OHIO CASE No. 22CV205129 Appellees

DECISION AND JOURNAL ENTRY

Dated: May 26, 2026

FLAGG LANZINGER, Judge.

{¶1} Plaintiffs-Appellants, Shane Siniscalchi and Eric Velazques, and their legal

counsel, Attorney Michael Fortney, appeal the judgment of the Lorain County Court of Common

Pleas.

{¶2} Siniscalchi and Velazquez filed a complaint against Defendants-Appellees, K.

Hovnanian Meadow Lakes, LLC, Hovnanian Enterprises, Inc., K. Hovnanian Enterprises, Inc., K.

Hovnanian Companies, LLC, Steve Butwinski, Dominic Passalacqua, and Rafael Swift

(collectively “Hovnanian defendants”), asserting claims related to a purchase and sale agreement

between the parties. The Hovnanian defendants filed a motion to stay and compel arbitration based

on mandatory arbitration language in the agreement. The trial court granted the motion and

ordered the parties to submit the matter to binding arbitration. 2

{¶3} After the arbitrator issued his decision, the Hovnanian defendants filed a notice of

arbitration decision and attached the arbitrator’s decision as an exhibit. The arbitrator issued an

award in favor of Siniscalchi and Velazquez from K. Hovnanian Meadow Lakes, LLC on the

breach of contract claim in the amount of $33,214.83, plus statutory interest beginning within 30

days from the date of the award. The arbitrator indicated that the award was made in full settlement

of all claims and counterclaims submitted to the arbitration. The arbitrator expressly stated that

no award was made in favor of Siniscalchi and Velazquez with respect to any of the other named

defendants. The arbitrator further stated, “[a]s the award is based on contract damages only, there

is no award for noneconomic damages under Chapter 4722, loss of use, punitive damages or

attorney’s fees.”

{¶4} The trial court filed an order noting the arbitration decision was filed and dismissed

the complaint with prejudice. Neither party appealed the trial court’s dismissal order.

{¶5} Almost three months later, Siniscalchi and Velazquez filed a motion to vacate or

modify the arbitration award. The Hovnanian defendants opposed the motion and Siniscalchi and

Velazquez filed a reply in support of their motion. The trial court denied the motion on the basis

that Siniscalchi and Velazquez had failed to set forth any basis for modification or vacation under

either the federal or the state statute governing arbitration awards. The trial court noted that the

only argument Siniscalchi and Velazquez presented in their motion was the assertion that they

were entitled to vacation or modification under a “manifest disregard of the law” standard of

review that is no longer recognized under either federal or state law. Siniscalchi and Velazquez

did not appeal the trial court’s denial of the motion to vacate or modify.

{¶6} The Hovnanian defendants subsequently filed a motion for sanctions against

Siniscalchi and Velazquez pursuant to R.C. 2323.51, arguing they had no good faith legal basis 3

for filing the motion to vacate or modify the arbitration award and requested an award of attorney’s

fees incurred to defend the motion. Siniscalchi and Velazquez opposed the motion and the

Hovnanian defendants filed a reply in support of their motion. The trial court set the matter for a

hearing.

{¶7} At the hearing, the trial court heard testimony from the Hovnanian defendants’

witness, Attorney Michael Mercier, in-house counsel for the East Group of K. Hovnanian

Companies, LLC, and Siniscalchi. The trial court admitted as evidence two exhibits submitted by

the Hovnanian defendants relevant to the amount of attorney’s fees requested.

{¶8} Following the hearing, the trial court granted the motion for sanctions, finding that

Siniscalchi and Velazquez had engaged in frivolous conduct when they filed their motion to vacate

or modify “even though the arguments advanced were ‘not warranted under existing law, [could]

not be supported by a good faith argument for an extension, modification, or reversal of existing

law, or [could] not be supported by a good faith argument for the establishment of new law.”

(Alterations in original.) The trial court awarded the Hovnanian defendants legal fees in the

amount of $9,600.00 and legal expenses in the amount of $378.70 to be paid by Siniscalchi,

Velazquez, and Fortney.

{¶9} Siniscalchi, Velazquez, and Fortney appeal, raising one assignment of error.

II.

ASSIGNMENT OF ERROR

THE TRIAL COURT ERRED WHEN IT DETERMINED THAT APPELLANTS ENGAGED IN FRIVOLOUS CONDUCT.

{¶10} In their sole assignment of error, Siniscalchi, Velazquez, and Fortney contend the

trial court erred when it determined they engaged in frivolous conduct when they filed the motion

to vacate or modify the arbitrator’s decision. We disagree. 4

{¶11} The trial court granted the Hovnanian defendants’ motion for sanctions pursuant to

R.C. 2323.51(A)(2)(a)(ii). Under the statute, “[f]rivolous conduct” means conduct by a party to a

civil action that “is not warranted under existing law, cannot be supported by a good faith argument

for an extension, modification, or reversal of existing law, or cannot be supported by a good faith

argument for the establishment of new law.” Id. “This is an objective standard, and the test is

whether no reasonable attorney would have asserted the position in light of existing law.” Larsen

Medina, LLC v. Echelon Senior Living Group, LLC, 2025-Ohio-2282, ¶ 7 (9th Dist.) citing Kozar

v. Bio-Med. Applications of Ohio, Inc., 2004-Ohio-4963, ¶ 16 (9th Dist.). “This Court will

generally affirm a trial court’s factual determination of whether frivolous conduct has occurred if

that determination is supported by competent, credible evidence.” Larsen Medina, LLC at ¶ 7,

citing In re Guardianship of Bakhtiar, 2018-Ohio-1764, ¶ 19 (9th Dist.). However, the question

of whether a reasonable attorney would have asserted a legal position under R.C.

2323.51(A)(2)(a)(ii) is a question of law we review de novo. Larsen Medina, LLC at ¶ 7, quoting

Jefferson v. Creveling, 2009-Ohio-1214, ¶ 16 (9th Dist.), quoting Kozar at ¶ 16.

{¶12} On appeal, Siniscalchi, Velazquez, and Fortney do not contest the trial court’s

determination that the “manifest disregard of the law” standard of review is not applicable under

existing law. Instead, they assert that their conduct did not rise to the level of being frivolous

because they “made good faith arguments to show that the arbitrator incorrectly applied the law

and erred in his decision.” Specifically, they (1) “believed that the arbitrator’s decision improperly

denied [their] claims for violation of R.C. 4722,” and (2) they “believed that this was enough to

vacate or modify the arbitration award pursuant to R.C. 2711.10 and 11.” However, whether an

arbitrator correctly applied the law is not a basis for a trial court to vacate or modify an arbitration

award pursuant to either statute. 5

{¶13} “Ohio’s public policy strongly favors arbitration, as expressed in the Ohio

Arbitration Act codified in R.C. 2711.” Lorain v. Fraternal Ord.

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