Vinebrook Homes, L.L.C. v. Perkins

2023 Ohio 3721, 226 N.E.3d 493

• Court: Ohio Court of Appeals
• Decided: October 13, 2023
• Docket: C-220538 & C-220539
• Status: Published

Opinion

[Cite as Vinebrook Homes, L.L.C. v. Perkins, 2023-Ohio-3721.]

IN THE COURT OF APPEALS FIRST APPELLATE DISTRICT OF OHIO HAMILTON COUNTY, OHIO

VINEBROOK HOMES, LLC, : APPEAL NOS. C-220538 C-220539 Plaintiff-Appellee, : TRIAL NO. 21CV-13406

: O P I N I O N. vs. :

SARAH PERKINS, :

and :

CASSANDRA HORTON, :

Defendants-Appellants. :

Civil Appeals From: Hamilton County Municipal Court

Judgment Appealed From Is: Affirmed in Part, Reversed in Part, and Cause Remanded

Date of Judgment Entry on Appeal: October 13, 2023

Greenberger & Brewer, LLP, and Kevin R. Brewer, for Plaintiff-Appellee,

Sarah Perkins and Cassandra Horton, pro se. OHIO FIRST DISTRICT COURT OF APPEALS

BERGERON, Judge.

{¶1} Under Civ.R. 41(B)(1), before a court can involuntarily dismiss a party’s

claim or counterclaim with prejudice for failure to prosecute or to comply with a court

order, the court must first notify the party that their noncompliance could lead to

dismissal. Here, because the trial court in effect dismissed the counterclaims of

defendants-appellants Sarah Perkins and Cassandra Horton (collectively, “Tenants”)

against plaintiff-appellee Vinebrook Homes, LLC (“Vinebrook”) without notice when

Tenants failed to show up for trial, we reverse for compliance with Civ.R. 41(B)(1).

Additionally, we instruct the trial court to ensure that it returns to Tenants the $1,350

rent bond held with the court, if it has not already done so. We otherwise affirm the

trial court’s judgment entering a voluntary dismissal of Vinebrook’s damages claim

and overrule Tenants’ remaining assignments of error.

I.

{¶2} As the trial court put it, the “high level of distrust” between Vinebrook

and Tenants throughout this eviction dispute grew “into a mountain.” With competing

damages claims and after multiple failed attempts to facilitate payments between the

parties, the litigation marched towards a jury trial set for October 2022. When

Tenants failed to appear for trial, however, the litigation snapped into a resolution:

Vinebrook dropped its damages claim, and the court entered judgment for Vinebrook

on Tenants’ counterclaims. As we shall see, however, Tenants were owed notice before

the trial court could enter a final involuntary dismissal of their claims.

{¶3} After Tenants held over their residential lease at a Cincinnati home in

June 2021, Vinebrook, which managed the property at the time, served an eviction

notice. Tenants continued their holdover, and the trial court issued an eviction order

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in late July 2021 after a hearing that Tenants failed to attend. In exchange for a chance

at a new eviction hearing, the court allowed Tenants to post a $1,350 rent bond with

the court. Tenants did so, but their effort failed to alter the result—the court denied

their motion for a new hearing on August 6 and granted Vinebrook restitution of the

premises. Tenants vacated around August 8.

{¶4} Around the same time, Vinebrook added a damages claim for unpaid

rent and fees, and Tenants counterclaimed against Vinebrook. By the time the case

reached trial in October 2022, Vinebrook’s claim had shrunk to about $400. Tenants’

counterclaims, by contrast, had swelled to over $15,000, including demands for return

of overpaid rent, their security deposit, their rent bond, and $10,000 for fraud and

deceptive business practices. Prior to trial, and amid a flood of motions from Tenants,

the trial court held a July 2022 hearing to sort out the situation. With a jury trial set

for October 3, 2022, the trial court admonished Tenants that if the parties did not

settle before then, “there will be no continuances,” and “[w]e’re going to go to trial and

that’s going to be that.”

{¶5} When their October 2022 trial date arrived, however, Tenants failed to

show. Nonetheless, Vinebrook, in attendance, informed the court that it wished to

voluntarily dismiss its claim. The court accordingly entered a voluntary dismissal

without prejudice. At Vinebrook’s urging, the court also ordered the return of Tenants’

$1,350 rent bond. Going further, however, the court entered “judgment to the plaintiff

on the defendants counterclaims.”

{¶6} Days later, Tenants moved to set aside the judgment, explaining that

their absence at trial arose from Ms. Horton’s congestive heart failure condition for

which she received treatment in Cleveland in early September 2022. Providing hotel

3 OHIO FIRST DISTRICT COURT OF APPEALS

receipts, Tenants asked the court to set aside its judgment because Ms. Horton

recuperated at a hotel in Cleveland after her treatment (and under the watchful eye of

her doctors) through at least early October.

{¶7} But before the trial court could consider the motion, however, Tenants

submitted two notices of appeal, one regarding the final judgment entry and one

regarding a judgment entry of October 6, 2022. An entry for that date does not appear

in the record, but it corresponds with the date of Tenants’ motion to set aside. Tenants’

first and third assignments of error broadly challenge the trial court’s judgment on

their counterclaims, its entry of voluntary dismissal of Vinebrook’s claim, and the fact

that the court entered dismissal without prejudice. In essence, they argue the trial

court resolved the case prematurely without fully accounting for money owed to

Tenants. We consider these arguments together. Finally, Tenants contend in their

second assignment of error that the court erred in allowing concurrent litigation and

collections activity.

II.

{¶8} Across their first and third assignments of error, Tenants claim the trial

court erred in entering a voluntary dismissal, without prejudice, of Vinebrook’s

damages claim. In essence, Tenants argue that the case was resolved prematurely and

that the court should have continued the full case for complete resolution. The trial

court entered its dismissal of Vinebrook’s damages claim after its lawyer orally

expressed its willingness to voluntarily dismiss on the day of trial. This form of

dismissal is permitted under Civ.R. 41(A)(2). However, in the event that “a

counterclaim has been pleaded by a defendant prior to the service upon that defendant

of the plaintiff’s motion to dismiss, a claim shall not be dismissed against the 4 OHIO FIRST DISTRICT COURT OF APPEALS

defendant’s objection unless the counterclaim can remain pending for independent

adjudication by the court.” Civ.R. 41(A)(2). In other words, “the motion should be

granted when the defendant will not be prejudiced thereby, except by the prospect of

a second lawsuit.” Thompson v. Markham, 1st Dist. Hamilton No. C-880034, 1989

Ohio App. LEXIS 2927, 3 (July 26, 1989). Voluntary dismissals by order of court are

without prejudice unless otherwise specified. Civ.R. 41(A)(2).

{¶9} In reviewing the court’s entry of voluntary dismissal, we apply an abuse

of discretion standard. Thompson at 3 (“The determination of a motion for voluntary

dismissal under Civ. R. 41(A)(2) is generally within the sound discretion of the trial

court.”). Abuse of discretion occurs when “a court exercis[es] its judgment, in an

unwarranted way, in regard to a matter over which it has discretionary authority.”

Johnson v. Abdullah, 166 Ohio St.3d 427, 2021-Ohio-3304, 187 N.E.3d 463, ¶ 35.

{¶10} Although Tenants do not explicitly claim that dismissing Vinebrook’s

damages claim caused them any prejudice in pursuit of their counterclaim, we can

piece together such an argument from their brief. But our review of the record fails to

substantiate the point. Through its damages claim, Vinebrook sought to recover

unpaid rent and fees. Tenants’ counterclaim asserts the opposite—Vinebrook (and the

court) owes them, not the other way around. But Tenants offers no means by which

dismissal of Vinebrook’s damages claim prejudices them in prosecuting their

counterclaim. In other words, Tenants’ counterclaim in no way depends upon the

survival of Vinebrook’s damages claim. Furthermore, the default disposition of a

voluntary dismissal under Civ.R. 41(A)(2) is to dismiss without prejudice, and Tenants

advance no argument for why the court should have departed from that presumption.

5 OHIO FIRST DISTRICT COURT OF APPEALS

Therefore, we cannot say that the trial court abused its discretion in dismissing

Vinebrook’s claim without prejudice.

III.

{¶11} Tenants missed their chance to present their counterclaims at trial by

failing to appear. But failing to prosecute one’s claims by missing a key hearing or trial

date does not necessarily permit the court to involuntarily dismiss the claims without

further discussion. Between their first and third assignments of error, Tenants

additionally assert that the trial court erred in entering judgment for Vinebrook as a

consequence of their no-show. They’re correct, at least in procedural terms.

{¶12} Civ.R. 41(B)(1) permits the trial court, “after notice to the plaintiff’s

counsel,” to involuntarily dismiss a plaintiff’s claim when the plaintiff “fails to

prosecute, or comply with these rules or any court order.” “[W]here a plaintiff fails to

appear on the date set for a hearing, the court may either order a Civ. R. 41(B)(1)

dismissal or grant a continuance. There is no authority in the Civil Rules for

proceeding to a trial on the merits of the plaintiff’s claim in his absence.” Allstate Ins.

Co. v. Rule, 64 Ohio St.2d 67, 69, 413 N.E.2d 796 (1980). Although Tenants here were

defendants in the underlying eviction proceedings, they act as plaintiffs in pursuing

their counterclaims, and Civ.R. 41 treats counterclaims as “claims” for purposes of

involuntary dismissal. Civ.R. 41(C). Subject to narrow exceptions not applicable here,

involuntary dismissals under Civ.R. 41(B)(1) constitute adjudications on the merits

(i.e., with prejudice). Civ.R. 41(B)(3).

{¶13} As an initial matter, we can fairly construe the trial court’s “judgment”

for Vinebrook on Tenants’ counterclaims as an involuntary dismissal under Civ.R.

41(B)(1). The effect of involuntary dismissal and the court’s judgment is the same— 6 OHIO FIRST DISTRICT COURT OF APPEALS

Tenants lose on their counterclaims with prejudice and are unable to bring them again.

And an involuntary dismissal, rather than a judgment for Vinebrook, better reflects

the nature of the court’s decision. Rather than a default judgment, which the court

can award when defendants fail to appear for trial, an involuntary dismissal is

appropriate when claimants fail to prosecute their claim, or, in this instance, their

counterclaim. We therefore treat the trial court’s October 3, 2022 judgment entry as

an involuntary dismissal, with prejudice, of Tenants’ counterclaims against Vinebrook

under Civ.R. 41(B)(1).

{¶14} “We review a decision to dismiss a case pursuant to Civ.R. 41(B)(1) for

an abuse of discretion, and dismissals with prejudice are subject to heightened

scrutiny.” Williams v. Metro, 1st Dist. Hamilton No. C-190321, 2020-Ohio-3515, ¶ 23.

Abuse of discretion occurs when “a court exercis[es] its judgment, in an unwarranted

way, in regard to a matter over which it has discretionary authority.” Johnson, 166

Ohio St.3d 427, 2021-Ohio-3304, 187 N.E.3d 463, at ¶ 35. Because a court “does not

have discretion to apply the law incorrectly,” however, we apply a de novo standard

when reviewing issues of law. Id. at ¶ 38. Although the court has discretion whether

to enter an involuntary dismissal upon a party’s failure to prosecute under Civ.R.

41(B)(1), it must comply with the rule’s notice requirement if it chooses to do so.

Therefore, although we review the trial court’s decision whether to enter an

involuntary dismissal for an abuse of discretion, we review its compliance with Civ.R.

41(B)(1)’s notice requirement de novo.

{¶15} “Generally, notice is a prerequisite to dismissal for failure to prosecute

under Civ.R. 41(B)(1). Hence, ‘[i]t is error for the trial court to dismiss plaintiff’s case

without notice for failure to prosecute when plaintiff and his counsel fail to appear for

7 OHIO FIRST DISTRICT COURT OF APPEALS

trial on the assigned trial date.’ ” Logsdon v. Nichols, 72 Ohio St.3d 124, 128, 647

N.E.2d 1361 (1995), quoting John W. McCormac, Ohio Civil Rules Practice, Section

13.07, at 356-357 (2d Ed.1992); see Dlouhy v. Frymier, 92 Ohio App.3d 156, 161, 634

N.E.2d 649 (9th Dist.1993) (“The notice requirement is an absolute prerequisite for

dismissal for failure to prosecute.”). Furthermore, “the notice requirement of Civ.R.

41(B)(1) applies to all dismissals with prejudice.” (Emphasis sic.) Ohio Furniture Co.

v. Mindala, 22 Ohio St.3d 99, 101, 488 N.E.2d 881 (1986). For pro se litigants with

claims subject to dismissal under this rule, “notice of the intended dismissal [is]

required to be sent to [claimant] himself.” Perotti v. Ferguson, 7 Ohio St.3d 1, 3, 454

N.E.2d 951 (1983).

{¶16} Notice under Civ.R. 41(B)(1) can be express or implied. Quonset Hut,

Inc. v. Ford Motor Co., 80 Ohio St.3d 46, 49, 684 N.E.2d 319 (1997), citing Logsdon

at 129 (Cook, J., concurring in part and dissenting in part); see Producers Credit Corp.

v. Voge, 12th Dist. Preble No. CA2002-06-009, 2003-Ohio-1067, ¶ 19 (“[I]mplied

notice of a trial court’s intention to dismiss exists when a party is on notice that the

opposing party has requested dismissal.”); Williams at ¶ 26, citing Quonset Hut, Inc.

at 47-48 (“A plaintiff has adequate notice under Civ.R. 41(B) when the defendant filed

a motion to dismiss with prejudice, the plaintiff filed a responsive motion, and the

plaintiff did not take any later steps to correct the noncompliance.”). However, merely

scheduling a case for trial and providing notice of the date to the claimant is

insufficient to constitute actual or implied notice under Civ.R. 41(B)(1). Logsdon at

128-129 (rejecting the partial concurrence’s argument to the contrary). To further

understand the rule’s notice requirement, we derive additional guidance from its

ascribed purpose. “The purpose of notice is to ‘provide the party in default an

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opportunity to explain the default or to correct it, or to explain why the case should

not be dismissed with prejudice.’ * * * Notice allows the dismissed party to explain the

circumstances causing his or her nonappearance.” Logsdon at 128, quoting

McCormac, Section 13.07, at 357. In sum, when a party fails to appear for trial but has

not received notice that their failure to appear would result in involuntary dismissal,

the court owes the party an opportunity to explain their absence, effectively giving

notice, prior to entering the dismissal. If the court is then satisfied with the

explanation, it can instead continue the case.

{¶17} Here, neither Vinebrook nor the trial court provided Tenants actual or

implied notice of the court’s intent to involuntarily dismiss their counterclaims. On

the day of trial, Tenants failed to appear, and the court effectively dismissed Tenants’

counterclaims contemporaneously. Seemingly acknowledging that the requirements

of Civ.R. 41(B) apply here, Vinebrook assures us that Tenants actually received notice,

pointing to two different sources in the record. First, it emphasizes the trial court’s

October 2021 entry setting a case management conference for December 2021, in

which the trial court notes “[f]ailure to appear will be grounds for dismissal and/or

default.” However, this order put Tenants on notice only about the consequences for

missing that case management conference, not the trial, which was eventually

scheduled to occur about a year later. Second, Vinebrook refers us to the trial court’s

admonishment to Tenants at the July 2022 motions hearing, described above in Part

I. But warning Tenants that “there will be no continuances,” and “[w]e’re going to go

to trial and that’s going to be that,” fails to provide Tenants with direct or implied

notice that their failure to appear at trial would result in involuntary dismissal of their

counterclaims. Furthermore, Vinebrook did not move for involuntary dismissal due

9 OHIO FIRST DISTRICT COURT OF APPEALS

to Tenants’ failure to appear at trial prior to the court’s final judgment. Therefore,

Tenants lacked explicit or implied notice.

{¶18} Because Tenants lacked sufficient notice prior to missing the trial date,

we conclude that Tenants were owed at least an opportunity to explain their failure to

appear at trial and for the trial court to take their argument into consideration prior to

deciding whether to enter an involuntary dismissal of their counterclaims. See

Logsdon, 72 Ohio St.3d at 128, 647 N.E.2d 1361. Instead, the trial court immediately

entered its final judgment, which we construe as an involuntary dismissal, on Tenants’

counterclaims without affording them a chance to be heard. Therefore, we sustain

Tenants’ first and third assignments of error only insofar as they challenge the court’s

failure to comply with Civ.R. 41(B)(1)’s notice provision. They are overruled in all

other respects.

IV.

{¶19} Finally, Tenants’ second assignment of error faults the court for

allowing collections activity to occur during the course of this litigation. Although we

acknowledge the burden of compounding financial and legal troubles, the legal basis

for Tenants’ assignment of error remains unclear. Tenants cite one case, Mazzarella

v. McGinnes, Cleveland M.C. No. 91-CVG-30291 (Dec. 30, 1991), without explaining

its relevance. A review of that case reveals no potential applicability to Tenants’ claim.

“An appellate court may disregard an assignment of error presented for review ‘if the

party raising it fails to identify in the record the error on which the assignment of error

is based.’ ” Fontain v. Sandhu, 1st Dist. Hamilton No. C-200011, 2021-Ohio-2750, ¶

14, quoting App.R. 12(A)(2); App.R. 16(A). Because Tenants failed to identify a legal

basis for their argument, we overrule their second assignment of error. 10 OHIO FIRST DISTRICT COURT OF APPEALS

* * *

{¶20} Ultimately, we sustain in part and overrule in part Tenants’ first and

third assignments of error. We reverse only the trial court’s judgment for Vinebrook

on Tenants’ counterclaims and remand solely for the purpose of allowing Tenants

notice consistent with Civ.R. 41(B) and a reasonable opportunity to explain their

absence at trial. Upon consideration of Tenants’ arguments, the trial court should

ultimately decide whether to enter the involuntary dismissal of Tenants’ counterclaims

or to continue the case for a new trial date. In conjunction with its decision, the trial

court should resolve Tenants’ motion to set aside the default judgment. We affirm the

trial court’s voluntary dismissal of Vinebrook’s damages claim and overrule Tenants’

second assignment of error regarding collections activity. Finally, to the extent that it

hasn’t already, the trial court should ensure that it returns Tenants’ $1,350 rent bond,

as agreed upon by the parties and the court.

Judgment affirmed in part, reversed in part, and cause remanded.

ZAYAS, P.J., and KINSLEY, J., concur.

Please note:

The court has recorded its entry on the date of the release of this opinion.