[Cite as Weckel v. Cole + Russell Architects, 2019-Ohio-3069.]
IN THE COURT OF APPEALS FIRST APPELLATE DISTRICT OF OHIO HAMILTON COUNTY, OHIO
FREDERIC C. WECKEL, : APPEAL NO. C-180438 TRIAL NO. A-0407805 Plaintiff-Appellee, :
vs. : O P I N I O N.
COLE + RUSSELL ARCHITECTS, :
Defendant-Appellant. :
Civil Appeal From: Hamilton County Court of Common Pleas
Judgment Appealed From Is: Affirmed
Date of Judgment Entry on Appeal: July 31, 2019
Tobias, Torchia & Simon and David Torchia, for Plaintiff-Appellee,
Keating Muething & Klekamp PLL and Kasey L. Bond, for Defendant-Appellant. OHIO FIRST DISTRICT COURT OF APPEALS
BERGERON, Judge.
{¶1} Litigation often stirs emotions, hardens principles, and drains the
rationality from perfectly rational people. Cost-benefit analyses can be tossed out
the window, and positions might be pursued regardless of the odds. At the end of the
day, after the court or jury declares a winner and a loser, however, for many the
bitterest pill of all to swallow is their lawyer’s bill. But absent certain recognized
exceptions, the “American rule” dictates that parties must pay their own way in
litigation. Seeing no reason to depart from that principle in this case, we affirm the
judgment below denying an award of attorney’s fees.
{¶2} The underlying lawsuit here stretches back more than a decade,
concerning plaintiff-appellee Frederic C. Weckel’s termination from defendant-
appellant Cole + Russell Architects (“C+R”) in 2004. Mr. Weckel helped C+R grow
and expand, and he wore multiple hats at the firm—serving as a managing principal
in the firm, a member of the board of directors, and a shareholder. The parties tried
to negotiate a severance package, but those efforts fell through, and the matter
ultimately proceeded to litigation for wrongful discharge and breach of fiduciary
duty.
{¶3} After more than three years of litigation, the parties reached a
settlement agreement, set forth in a 2008 “Letter Agreement,” which contemplated
Mr. Weckel selling his firm stock to the firm’s employee stock ownership plan. But
the Letter Agreement was, as the title suggests, a letter that sketched out key
principles of the deal, and that anticipated a formal “Settlement Agreement.” The
entire deal was also contingent because C+R needed an independent advisor to
provide a professional opinion blessing the sale of the stock. Unfortunately for
everyone involved, that contingency did not come to pass, as the independent advisor
2 OHIO FIRST DISTRICT COURT OF APPEALS
concluded that the sale could not proceed as formulated (for various reasons not
germane to this appeal). In the wake of that determination, C+R proclaimed the
Letter Agreement “null and void,” and the litigation that the parties hoped to put to
bed by the settlement roared back to life. Mr. Weckel responded to this volley by
seeking to enforce the Letter Agreement, but the trial court declined, pointing to the
failure of the condition precedent. In the midst of all of this, perhaps needless to say,
the parties never executed the Settlement Agreement contemplated by the Letter
Agreement.
{¶4} On appeal from the trial court’s denial of the motion to enforce, we
held that the trial court abused its discretion in extinguishing discovery (thereby
cutting off Mr. Weckel’s efforts to undermine the independence of the independent
advisor’s conclusions), and that as a result, it had prematurely denied the motion to
enforce. Weckel v. Cole + Russell Architects, 2013-Ohio-2718, 994 N.E.2d 885 (1st
Dist.) (“Weckel I”). We reversed the trial court’s denial of the motion to reopen
discovery, vacated the portion of the trial court’s order denying the motion to
enforce, and remanded for discovery.
{¶5} The matter then proceeded below with discovery and an evidentiary
hearing, but ultimately arrived at the same destination, as the trial court again
overruled the motion to enforce the settlement. On an encore appeal here, we
affirmed the trial court’s judgment, and the Ohio Supreme Court declined review.
Weckel v. Cole + Russell Architects, 1st Dist. Hamilton No. C-160591, 2017-Ohio-
7491, appeal not allowed, 152 Ohio St.3d 1422, 2018-Ohio-923, 93 N.E.3d 1003
(“Weckel II”).
{¶6} During the course of that convoluted procedural history, C+R racked
up over $400,000 in attorney fees and expert witness fees. Evidently frustrated with
3 OHIO FIRST DISTRICT COURT OF APPEALS
those costs for litigation that it had prevailed upon, it moved the trial court to have
Mr. Weckel foot the bill, clinging to a provision in the Letter Agreement that
referenced a to-be-included fee-shifting provision in the (never executed) Settlement
Agreement. The trial court denied the motion. C+R now appeals the trial court’s
decision with a single assignment of error contesting that determination. We review
the decision below, a question of contract law, de novo for “whether the trial court
erred as a matter of law.” Continental W. Condominium Unit Owners Assn. v.
Howard E. Ferguson, Inc., 74 Ohio St.3d 501, 502, 660 N.E.2d 431 (1996).
{¶7} Ohio follows the “American rule” with regard to attorney fees: “a
prevailing party in a civil action may not recover attorney fees as a part of the costs of
litigation.” (Citations omitted.) Wilborn v. Bank One Corp., 121 Ohio St.3d 546,
2009-Ohio-306, 906 N.E.2d 396, ¶ 7. This rule is not without exception, but such
exceptions are generally limited to the presence of a specific provision for an award
of attorney fees in a statute or contract. Id. Otherwise, a prevailing party must
“demonstrate[] bad faith on the part of the unsuccessful litigant” to circumvent the
American rule. (Citation omitted.) Id.
{¶8} C+R pursues the contract path, relying on the following Letter
Agreement provision in its effort to fit into one of these exceptions:
5. The Settlement Agreement and a Mutual Release will also
contain a provision stating that in any lawsuit between the parties
relating to the Settlement Agreement, the prevailing party (1) will be
entitled to an award of his/its attorneys fees and costs in
prosecuting/defending the suit, and (2) in the event the court finds
that an award of additional damages, including punitive damages, is
4 OHIO FIRST DISTRICT COURT OF APPEALS
allowed by the law, the court may award such additional damages to
the prevailing party.
{¶9} C+R’s reliance on this language, however, suffers from several flaws.
First, C+R’s success in the prior appeals was largely predicated on its argument that
the Letter Agreement, upon the failure of the independent-advisor condition
precedent, became null and void. Indeed, that is exactly what the trial court held, a
result that we affirmed on appeal. Weckel II, 1st Dist. Hamilton No. C-160591, 2017-
Ohio-7491, at ¶ 21. We explained that if “a condition precedent is not fulfilled, the
parties are excused from performing under the contract[,]” and that here, the Letter
Agreement failed to include any “contingency plan” for that eventuality. (Citation
omitted.) Id. at ¶ 26, 33.
{¶10} Having succeeded in the quest to invalidate the Letter Agreement,
C+R cannot now attempt to breathe new life into the contract that it scuttled. Nor
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[Cite as Weckel v. Cole + Russell Architects, 2019-Ohio-3069.]
IN THE COURT OF APPEALS FIRST APPELLATE DISTRICT OF OHIO HAMILTON COUNTY, OHIO
FREDERIC C. WECKEL, : APPEAL NO. C-180438 TRIAL NO. A-0407805 Plaintiff-Appellee, :
vs. : O P I N I O N.
COLE + RUSSELL ARCHITECTS, :
Defendant-Appellant. :
Civil Appeal From: Hamilton County Court of Common Pleas
Judgment Appealed From Is: Affirmed
Date of Judgment Entry on Appeal: July 31, 2019
Tobias, Torchia & Simon and David Torchia, for Plaintiff-Appellee,
Keating Muething & Klekamp PLL and Kasey L. Bond, for Defendant-Appellant. OHIO FIRST DISTRICT COURT OF APPEALS
BERGERON, Judge.
{¶1} Litigation often stirs emotions, hardens principles, and drains the
rationality from perfectly rational people. Cost-benefit analyses can be tossed out
the window, and positions might be pursued regardless of the odds. At the end of the
day, after the court or jury declares a winner and a loser, however, for many the
bitterest pill of all to swallow is their lawyer’s bill. But absent certain recognized
exceptions, the “American rule” dictates that parties must pay their own way in
litigation. Seeing no reason to depart from that principle in this case, we affirm the
judgment below denying an award of attorney’s fees.
{¶2} The underlying lawsuit here stretches back more than a decade,
concerning plaintiff-appellee Frederic C. Weckel’s termination from defendant-
appellant Cole + Russell Architects (“C+R”) in 2004. Mr. Weckel helped C+R grow
and expand, and he wore multiple hats at the firm—serving as a managing principal
in the firm, a member of the board of directors, and a shareholder. The parties tried
to negotiate a severance package, but those efforts fell through, and the matter
ultimately proceeded to litigation for wrongful discharge and breach of fiduciary
duty.
{¶3} After more than three years of litigation, the parties reached a
settlement agreement, set forth in a 2008 “Letter Agreement,” which contemplated
Mr. Weckel selling his firm stock to the firm’s employee stock ownership plan. But
the Letter Agreement was, as the title suggests, a letter that sketched out key
principles of the deal, and that anticipated a formal “Settlement Agreement.” The
entire deal was also contingent because C+R needed an independent advisor to
provide a professional opinion blessing the sale of the stock. Unfortunately for
everyone involved, that contingency did not come to pass, as the independent advisor
2 OHIO FIRST DISTRICT COURT OF APPEALS
concluded that the sale could not proceed as formulated (for various reasons not
germane to this appeal). In the wake of that determination, C+R proclaimed the
Letter Agreement “null and void,” and the litigation that the parties hoped to put to
bed by the settlement roared back to life. Mr. Weckel responded to this volley by
seeking to enforce the Letter Agreement, but the trial court declined, pointing to the
failure of the condition precedent. In the midst of all of this, perhaps needless to say,
the parties never executed the Settlement Agreement contemplated by the Letter
Agreement.
{¶4} On appeal from the trial court’s denial of the motion to enforce, we
held that the trial court abused its discretion in extinguishing discovery (thereby
cutting off Mr. Weckel’s efforts to undermine the independence of the independent
advisor’s conclusions), and that as a result, it had prematurely denied the motion to
enforce. Weckel v. Cole + Russell Architects, 2013-Ohio-2718, 994 N.E.2d 885 (1st
Dist.) (“Weckel I”). We reversed the trial court’s denial of the motion to reopen
discovery, vacated the portion of the trial court’s order denying the motion to
enforce, and remanded for discovery.
{¶5} The matter then proceeded below with discovery and an evidentiary
hearing, but ultimately arrived at the same destination, as the trial court again
overruled the motion to enforce the settlement. On an encore appeal here, we
affirmed the trial court’s judgment, and the Ohio Supreme Court declined review.
Weckel v. Cole + Russell Architects, 1st Dist. Hamilton No. C-160591, 2017-Ohio-
7491, appeal not allowed, 152 Ohio St.3d 1422, 2018-Ohio-923, 93 N.E.3d 1003
(“Weckel II”).
{¶6} During the course of that convoluted procedural history, C+R racked
up over $400,000 in attorney fees and expert witness fees. Evidently frustrated with
3 OHIO FIRST DISTRICT COURT OF APPEALS
those costs for litigation that it had prevailed upon, it moved the trial court to have
Mr. Weckel foot the bill, clinging to a provision in the Letter Agreement that
referenced a to-be-included fee-shifting provision in the (never executed) Settlement
Agreement. The trial court denied the motion. C+R now appeals the trial court’s
decision with a single assignment of error contesting that determination. We review
the decision below, a question of contract law, de novo for “whether the trial court
erred as a matter of law.” Continental W. Condominium Unit Owners Assn. v.
Howard E. Ferguson, Inc., 74 Ohio St.3d 501, 502, 660 N.E.2d 431 (1996).
{¶7} Ohio follows the “American rule” with regard to attorney fees: “a
prevailing party in a civil action may not recover attorney fees as a part of the costs of
litigation.” (Citations omitted.) Wilborn v. Bank One Corp., 121 Ohio St.3d 546,
2009-Ohio-306, 906 N.E.2d 396, ¶ 7. This rule is not without exception, but such
exceptions are generally limited to the presence of a specific provision for an award
of attorney fees in a statute or contract. Id. Otherwise, a prevailing party must
“demonstrate[] bad faith on the part of the unsuccessful litigant” to circumvent the
American rule. (Citation omitted.) Id.
{¶8} C+R pursues the contract path, relying on the following Letter
Agreement provision in its effort to fit into one of these exceptions:
5. The Settlement Agreement and a Mutual Release will also
contain a provision stating that in any lawsuit between the parties
relating to the Settlement Agreement, the prevailing party (1) will be
entitled to an award of his/its attorneys fees and costs in
prosecuting/defending the suit, and (2) in the event the court finds
that an award of additional damages, including punitive damages, is
4 OHIO FIRST DISTRICT COURT OF APPEALS
allowed by the law, the court may award such additional damages to
the prevailing party.
{¶9} C+R’s reliance on this language, however, suffers from several flaws.
First, C+R’s success in the prior appeals was largely predicated on its argument that
the Letter Agreement, upon the failure of the independent-advisor condition
precedent, became null and void. Indeed, that is exactly what the trial court held, a
result that we affirmed on appeal. Weckel II, 1st Dist. Hamilton No. C-160591, 2017-
Ohio-7491, at ¶ 21. We explained that if “a condition precedent is not fulfilled, the
parties are excused from performing under the contract[,]” and that here, the Letter
Agreement failed to include any “contingency plan” for that eventuality. (Citation
omitted.) Id. at ¶ 26, 33.
{¶10} Having succeeded in the quest to invalidate the Letter Agreement,
C+R cannot now attempt to breathe new life into the contract that it scuttled. Nor
can it selectively pick and choose which provisions should retain vitality—that would
run afoul of our prior decision and basic contract law.
{¶11} Second, the quoted language provides that the attorney fees may be
awarded for litigation “relating to the Settlement Agreement”—a document that the
parties agree does not exist. Cognizant of that problem, C+R essentially conflates the
Letter Agreement with the Settlement Agreement, blurring the lines between the
documents. But, try as they might, they cannot get around the fact that the
Settlement Agreement never existed, and we fail to see how litigation can relate to an
imaginary agreement. In other words, even if the Letter Agreement were fully
enforceable, the provision quoted above, by its terms, does not allow for an award of
fees in this situation.
5 OHIO FIRST DISTRICT COURT OF APPEALS
{¶12} Underscoring the point, the paragraph immediately preceding the one
relied upon by C+R offers context to the Settlement Agreement referenced in the
quoted language: “4. The parties will execute a Settlement Agreement and Mutual
Release * * *.” (Emphasis added.) Nothing in either provision suggests that the
Letter Agreement itself provided for prevailing party attorney fees; they provide only
that a future “Settlement Agreement” will include such a provision. With the failure
of the independent-advisor-approval condition precedent, the parties never
consummated the anticipated Settlement Agreement.
{¶13} The relevant provisions of the Letter Agreement here admit of no
ambiguity on this point, and we decline any invitation to rewrite them. See Shifrin v.
Forest City Ents., Inc., 64 Ohio St.3d 635, 638, 597 N.E.2d 499 (1992) (“When the
terms in a contract are unambiguous, courts will not in effect create a new contract
by finding an intent not expressed in the clear language employed by the parties.”).
{¶14} C+R has not pointed to a specific, enforceable contract term that
provides for fee shifting in the present circumstances. As a last resort, it reaches to
out-of-state authority, California-Am. Water Co. v. Marian Coast Water Dist., 18
Cal.App.5th 571, 227 Cal.Rptr.3d 110 (Cal.App.2017), to support its position, positing
that fees can be awarded notwithstanding a determination of the invalidity of the
underlying contract. But that case offers little insights for our interpretation of Ohio
contract law. California provides for mutual attorney fees by a statute in certain
situations, which the California-Am. Water Co. opinion construed; no such Ohio
statute applies to the dispute at hand. Accordingly, we find that decision inapposite
to the case before us.
{¶15} For the foregoing reasons, we overrule C+R’s single assignment of
error and affirm the judgment of the trial court.
6 OHIO FIRST DISTRICT COURT OF APPEALS
Judgment affirmed.
MOCK, P. J., and MYERS, J., concur.
Please note: The court has recorded its own entry this date.