State ex rel. Huntington Natl. Bank v. Kontos

2014 Ohio 1374

• Court: Ohio Court of Appeals
• Decided: March 31, 2014
• Docket: 2013-T-0089
• Status: Published

Opinion

[Cite as State ex rel. Huntington Natl. Bank v. Kontos, 2014-Ohio-1374.]

IN THE COURT OF APPEALS

ELEVENTH APPELLATE DISTRICT

TRUMBULL COUNTY, OHIO

STATE ex rel. THE HUNTINGTON : OPINION NATIONAL BANK, et al., :

Relator, : CASE NO. 2013-T-0089

- vs - :

HONORABLE JUDGE : PETER J. KONTOS, :

Respondent. :

Original Action for Writ of Procedendo and Prohibition.

Judgment: Petition dismissed.

Shawn W. Maestle, Weston Hurd LLP, The Tower at Erieview, 1301 East Ninth St., Suite 1900, Cleveland, OH 44114 (For Relator).

Dennis Watkins, Trumbull County Prosecutor, Administration Building, Fourth Floor, 160 High Street, N.W., Warren, OH 44481 (For Respondent).

COLLEEN MARY O’TOOLE.

{¶1} This matter is before this court on the August 19, 2013 “Petition for Writ of

Procedendo and Prohibition,” and on the August 27, 2013 “Amended Petition for Writ of

Procedendo and Prohibition” filed by relator, The Huntington National Bank, successor

by merger to Sky Bank. Relator maintains that because respondent, Honorable Judge

Peter J. Kontos, has determined that no evidence exists in the record at this time to

award damages to interested party, W. Thomas James (“James”), pursuant to this court’s remand in James v. Sky Bank, 11th Dist. Trumbull No. 2010-T-0116, 2012-Ohio-

3883, respondent must issue judgment for relator and must be prohibited from

conducting an evidentiary hearing on damages.

{¶2} A review of relator’s procedendo and prohibition petition shows that its

claim for relief is predicated upon the following factual background involving a

construction loan dispute:

{¶3} In 2006, James, his wife, and James Funeral Home, Inc. filed a complaint

for breach of contract against relator as well as other claims against defendants New

Horizon Building and Remodeling, Inc., Gregory T. Yurco, a bank vice president, and

James’ brother, Ronald James. Prior to trial before respondent’s magistrate, James

dismissed all defendants except for relator. On October 1, 2010, a judgment was

issued against relator for breach of contract.

{¶4} Relator filed a timely appeal with this court, Case No. 2010-T-0116. On

August 27, 2012, this court reversed and remanded the judgment of the trial court.

James, 2012-Ohio-3883. Specifically, this court held that James, in a breach of contract

action, must prove and present sufficient evidence that the breach proximately resulted

in damages which can be ascertained to a reasonable certainty. Id. at ¶31-33, 47-55.

This court further held that “additional expenditures after the contractor stopped work

are not the proper measure of damages caused by the bank’s improper disbursement of

funds.” Id. at ¶52. This court explained that “the proper measure of damages under the

circumstances of this case would be the difference between the funds the bank

improperly released to the contractor ($635,000) for the work the contractor claimed it

had performed, and the actual value of that work (in materials and labor).” Id. at ¶53.

2 {¶5} This court ordered that respondent apply the proper measure of damages

to the existing record and determine if the evidence justified any damages. Specifically,

this court stated: “[i]t is unclear whether the difference between the funds released to

New Horizon and the actual value of the work completed by New Horizon could be

ascertained from the evidence presented.” Id. at ¶54. “On remand, the trial court is to

recalculate damages applying the proper measurement set forth in this opinion based

on the evidence contained on the record.” Id. at ¶61.

{¶6} Pursuant to this court’s remand, respondent ordered briefing and

conducted a hearing on April 26, 2013. On July 17, 2013, respondent issued a

judgment, stating that “[h]aving now reviewed the record of the trial proceedings, the

Court finds that it is unable to arrive at a proper measure of damages as enunciated by

the Court of Appeals without additional testimony.” Thus, respondent ordered that a

new evidentiary hearing on damages would be held before its magistrate.

{¶7} As a result, relator filed the instant procedendo and prohibition petition

contemporaneously with a notice of appeal, Case No. 2013-T-0087. This court

dismissed relator’s appeal for lack of jurisdiction because the July 17, 2013 judgment

was not a final appealable order. James v. Sky Bank, 11th Dist. Trumbull No. 2013-T-

0087, 2014-Ohio-1159.

{¶8} While the appeal was pending, in response to the procedendo and

prohibition petition, respondent filed a motion to dismiss on August 30, 2013, pursuant

to Civ.R. 12(B), contending that relator has failed to state a claim upon which relief can

be granted. On September 13, 2013, relator filed a brief in opposition. Respondent

filed a reply four days later.

3 {¶9} Regarding relator’s request for prohibition, this court stated in State ex rel.

Caszatt v. Gibson, 11th Dist. Lake No. 2012-L-107, 2013-Ohio-213, ¶15:

{¶10} “A writ of prohibition can only be issued where the relator establishes that:

(1) a judicial officer or court intends to exercise judicial power over a pending matter; (2)

the proposed use of that power is unauthorized under the law; and (3) the denial of the

writ will result in harm for which there is no other adequate remedy in the ordinary

course of the law. State ex rel. Florence v. Zitter, 106 Ohio St.3d 87, 2005-Ohio-3804,

¶14 * * *; State ex rel. Sliwinski v. Unruh, 118 Ohio St.3d 76, 2008-Ohio-1734, ¶7 * * *.

A writ of prohibition is a legal order under which a court of superior jurisdiction enjoins a

court of inferior jurisdiction from exceeding the general scope of its inherent authority.

State ex rel. Feathers v. Hayes, 11th Dist. No. 2006-P-0092, 2007-Ohio-3852, ¶9; State

ex rel. Tubbs Jones v. Suster, 84 Ohio St.3d 70 * * * (1998). The writ is an

extraordinary remedy which should not be issued in a routine manner. State ex rel. The

Leatherworks Partnership v. Stuard, 11th Dist. No. 2002-T-0017, 2002-Ohio-6477, ¶15.”

(Parallel citations omitted.)

{¶11} In this case, relator alleges that respondent was about to exercise

jurisdiction in the underlying action by ordering his magistrate to hold an evidentiary

hearing on damages. As a result, relator’s allegation is legally sufficient to satisfy the

first element of a prohibition claim. Caszatt, supra, at ¶15; Leatherworks, supra, at ¶16.

Accordingly, the outcome of our analysis as to the sufficiency of relator’s request for

prohibition will turn upon whether its allegation can satisfy the second and third

elements of such a claim.

{¶12} “[T]he initial issue which must be addressed in regard to the second and

third elements is whether the alleged jurisdictional defect is patent and unambiguous. *

4 * * [I]f there are no set of facts under which a trial court or judge could have jurisdiction

over a particular case, the alleged jurisdictional defect will always be considered patent

and unambiguous. On the other hand, if the court or judge generally has subject matter

jurisdiction over the type of case in question and his authority to hear that specific action

will depend on the specific facts before him, the jurisdictional defect is not obvious and

the court/judge should be allowed to decide the jurisdictional issue.” Leatherworks,

supra, at ¶19.

{¶13} We note that respondent, as a sitting member of a county common pleas

court, generally has subject matter jurisdiction to hear a case such as the instant. The

alleged jurisdictional defect in this action, as asserted by relator in its petition, is not

patent and unambiguous.

{¶14} The exercise of judicial authority relator seeks to prohibit was specifically

ordered by this court in James, 2012-Ohio-3883. Relator seeks to prohibit respondent

from conducting an evidentiary hearing on damages. However, in James, this court

reversed and remanded the case “for further proceedings consistent with [the] opinion,”

and ordered respondent to “recalculate damages applying the proper measure set forth

in [the] opinion based on the evidence on the record.” Id. at ¶61. This court recognized

that “the record lacks competent, credible evidence proving the damages awarded by

the trial court to a reasonable degree of certainty under any measure of damages.” Id.

at ¶55. (Emphasis sic.) Thus, respondent properly referred the matter to his

magistrate, pursuant to Civ.R. 53(D)(4)(b), to take additional evidence as to damages

only, using the measure determined by this court in James, 2012-Ohio-3883. Once that

additional evidence is introduced, respondent may make a ruling consistent with this

court’s decision in James, 2012-Ohio-3883.

5 {¶15} A review of the trial court docket reveals that no damage hearing has been

held at this time. Relator availed itself of an appeal, albeit the July 17, 2013 judgment

that relator attempted to appeal in Case No. 2013-T-0087, was not a final appealable

order, resulting in the dismissal of that appeal. James, 2014-Ohio-1159. However,

once a damage hearing is held and a final judgment rendered, if respondent were to

make an improper decision, relator still has an adequate remedy at law because it can

file an appeal from that final judgment. See, e.g., Leatherworks, supra, at ¶14. Thus,

because an adequate legal remedy does exist, relator fails to establish that it is entitled

to a writ of prohibition.

{¶16} Regarding relator’s request for procedendo, this court stated in Caszatt,

supra, at ¶13:

{¶17} “To be entitled to a writ of procedendo, a relator must establish [1] a clear

legal right to require the court to proceed, [2] a clear legal duty on the part of the court to

proceed, and [3] the lack of an adequate remedy in the ordinary course of the law.

State ex rel. Sherrills v. Cuyahoga Cty. Court of Common Pleas, 72 Ohio St.3d 461, 462

* * * (1995). A writ of procedendo is proper when a court has refused to enter judgment,

or has unnecessarily delayed proceeding to judgment. State ex rel. Crandall, Pheils &

Wisniewski v. DeCessna, 73 Ohio St.3d 180, 184 * * * (1995). * * * ‘The writ of

procedendo is merely an order from a court of superior jurisdiction to one of inferior

jurisdiction to proceed to judgment.’ Yee v. Erie Cty. Sheriff’s Dept., 51 Ohio St.3d 43,

45 * * * (1990), quoting State ex rel. Davey v. Owen, 133 Ohio St. 96, 106 * * * (1937).

‘Procedendo is a proper remedy in any case in which a court has jurisdiction but refuses

to exercise it.’ Painter & Pollis, Ohio Appellate Practice, Section 10:50 (2011-2012

Ed.).” (Parallel citations omitted.)

6 {¶18} First, relator has not established a clear legal right to require the court to

proceed. Relator is asking this court to order respondent to issue a judgment in its

favor. However, that remedy cannot properly be granted by procedendo as “a writ of

procedendo is an order to proceed to judgment, not an order to proceed to a specific

outcome.” State ex rel. Anderson v. Sheeran, 10th Dist. Franklin No. 11AP-990, 2012-

Ohio-2949, ¶4, citing Sherrills, supra, at 462.

{¶19} In addition, this court has already held that “[t]he evidence supports the

trial court’s finding that the bank breached the loan agreement and improperly released

the funds, and that Mr. James was damaged as a result of the bank’s payments without

requiring the architect’s certification of progress and completion percentage.” James,

2012-Ohio-3883, at ¶30. Thus, if respondent were to now issue judgment in relator’s

favor, he would violate the law of the case doctrine. See Caszatt, supra, at ¶14; Nolan

v. Nolan, 11 Ohio St.3d 1, 3 (1984) (holding the law of the case doctrine “provides that

the decision of a reviewing court in a case remains the law of that case on the legal

questions involved for all subsequent proceedings in the case at both the trial and

reviewing levels.”)

{¶20} Second, relator cannot establish that respondent has a clear legal duty to

grant judgment in its favor. There is no language in James indicating that judgment

should be rendered in favor of relator. Rather, this court agreed with the trial court’s

determination that relator breached the terms of the loan agreement. James, 2012-

Ohio-3883, at ¶1. Although this court found that the trial court erred in its calculation of

damages caused by the breach, this court never held that judgment should be rendered

in favor of relator. Id.

7 {¶21} Third, relator cannot establish the lack of an adequate remedy in the

ordinary course of the law. In its brief in opposition to respondent’s motion to dismiss,

relator acknowledges that it “contemporaneously with this petition filed a putative appeal

of Respondent’s judgment to this Court * * * [in] Case No. 2013-T-0087.” As stated,

relator availed itself of an appeal, albeit the July 17, 2013 judgment that relator

attempted to appeal in Case No. 2013-T-0087, was not a final appealable order,

resulting in the dismissal of that appeal. James, 2014-Ohio-1159. However, once a

damage hearing is held and a final judgment rendered, if respondent were to make an

improper decision, relator still has an adequate remedy at law because it can file an

appeal from that final judgment. See, e.g., Leatherworks, supra, at ¶14.

{¶22} We note that an appeal is an adequate remedy to prevent a writ of

procedendo. See State ex rel. New Concept Hous., Inc. v. Metz, 123 Ohio St.3d 457,

2009-Ohio-5862, ¶2, quoting State ex rel. Bd. of State Teachers Retirement Sys. of

Ohio v. Davis, 113 Ohio St.3d 410, 2007-Ohio-2205, ¶43 (holding that “‘[p]rocedendo is

not appropriate when the party seeking the writ has an adequate remedy in the ordinary

course of law, e.g., appeal.’”) Thus, because an adequate legal remedy does exist,

relator fails to establish that it is entitled to a writ of procedendo.

{¶23} Accordingly, it is the order of this court that respondent’s motion to dismiss

is granted. Relator’s procedendo and prohibition petition is hereby dismissed.

THOMAS R. WRIGHT, J., concurs,

TIMOTHY P. CANNON, P.J., concurs with Concurring Opinion.

______________________

8 TIMOTHY P. CANNON, P.J., concurring.

{¶24} I concur with the majority opinion. However, I write to more specifically

address why I do not believe the trial court is “unauthorized under law” to request the

taking of additional evidence.

{¶25} I agree with relator that the opinion of this court was clear that “[o]n

remand, the trial court is to recalculate damages * * * based on the evidence contained

on the record.” James v. Sky Bank, 11th Dist. Trumbull No. 2010-T-0116, 2012-Ohio-

3883, ¶61. Following remand, the trial court referred the matter to the magistrate; this

was appropriate, because the magistrate took the initial evidence in the case. However,

the trial court heard arguments of counsel regarding the remand and determined it

would create a manifest injustice to issue a ruling “solely on the record now before the

court.”

{¶26} I disagree with relator that the trial court does not have authority to

proceed in the manner it has chosen upon remand. If, as relator suggests, our remand

order indicated the magistrate should issue a ruling based solely on the evidence

presented at the prior trial, the order did not otherwise limit the trial court’s additional

options. These options are very broad in scope. Civ.R. 53(D)(4) sets forth how the trial

court, in its discretion, may proceed when objections are or are not filed:

(b) Action on magistrate’s decision. Whether or not objections are timely filed, a court may adopt or reject a magistrate’s decision in whole or in part, with or without modification. A court may hear a previously-referred matter, take additional evidence, or return a matter to a magistrate.

***

(d) Action on objections. If one or more objections to a magistrate’s decision are timely filed, the court shall rule on those objections. In ruling on objections, the court shall undertake an independent

9 review as to the objected matters to ascertain that the magistrate has properly determined the factual issues and appropriately applied the law. Before so ruling, the court may hear additional evidence but may refuse to do so unless the objecting party demonstrates that the party could not, with reasonable diligence, have produced that evidence for consideration by the magistrate.

{¶27} Therefore, after referral to the magistrate under our remand order, the trial

court was in a position to take additional evidence, refer it back to the magistrate, or

exercise its discretion to do anything permitted under the rule. Because of this broad

scope of authority, the trial court has discretion in this circumstance to allow for the

taking of additional evidence by the magistrate. As the trial court has authority to take

additional evidence, the remand from this court should not limit the trial court’s authority

to have that evidence taken by the magistrate.