Whitaker v. Paru Selvam, L.L.C.

2014 Ohio 3263

• Court: Ohio Court of Appeals
• Decided: July 25, 2014
• Docket: 26103, 26108
• Status: Published

Opinion

[Cite as Whitaker v. Paru Selvam, L.L.C., 2014-Ohio-3263.]

IN THE COURT OF APPEALS OF OHIO SECOND APPELLATE DISTRICT MONTGOMERY COUNTY

LLOYD T. WHITAKER, TRUSTEE

Plaintiff-Appellee

v.

PARU SELVAM, LLC, et al.

Defendant-Appellee

Appellate Case Nos. 26103 and 26108

Trial Court Case Nos. 2013-CV-3168 2013-CV-4016

(Civil Appeal from (Common Pleas Court) ...........

OPINION

Rendered on the 25th day of July, 2014.

...........

RONALD J. KOZAR, Atty. Reg. No. 0041903, 40 North Main Street, Suite 2830, Dayton, Ohio 45423 Attorney for Plaintiff-Appellee-Lloyd T. Whitaker, Trustee

STEPHEN P. LINNEN, Atty. Reg. No. 0071290, 605 North High Street, Suite 262, Columbus, Ohio 43215 Attorney for Defendants-Appellants-Ashok Spiritual Healing Center and Siddhar Peedam, A NJ Non-Profit Corporation and for Defendant-Appellee-Paru Selvam, LLC

ANNAMALAI ANNAMALAI, Robert A. Deyton Detention Facility, 11866 Hastings Bridge Road, Lovejoy, Georgia, 30250 Defendant-Appellant-Pro Se 2

.............

WELBAUM, J.

{¶ 1} In this case, Intervening Defendant-Appellant, Annamalai Annamalai

(“Annamalai”), and Defendants-Appellants, Siddhar Peedam (“Siddhar”) and Ashok Spiritual

Healing Center (“Ashok”), appeal from a default judgment rendered in favor of

Plaintiff-Appellee, Lloyd Whitaker, Trustee, Estate of Hindu Temple and Community Center of

Georgia, Inc. (“Trustee”).

{¶ 2} All the Appellants challenge the propriety of the default judgment, as well as the

notice that preceded entry of the judgment. Siddhar and Ashok further contend that the default

judgment entry failed to comply with the requirements of Civ.R. 55 (C). In addition, Annamalai

contends that the trial court erred in refusing to allow him to file an amended answer and

counterclaim, and in failing to consider arguments pertaining to the res judicata effect of a

decision of the Bankruptcy Court for the Northern District of Georgia.

{¶ 3} We conclude that the trial court did not err in finding that Siddhar and Ashok

were properly served with the complaint and failed to timely answer. These defendants also

received an opportunity to show in writing why the default judgment should not be entered, and

availed themselves of the opportunity. They, therefore, received all process that they were due

under Civ.R. 55(A). Furthermore, assuming for purposes of argument that a procedural

irregularity occurred, Siddhar and Ashok waived any error by failing to object in the trial court.

The trial court also complied with Civ.R.55(C), because the default judgment awarded the same

relief that had been requested in the complaint.

{¶ 4} We further conclude that the trial court did not abuse its discretion in failing to

allow the filing of Annamalai’s proposed amended answer and counterclaim. Justice did not 3

require the filing of the answer and counterclaim. Finally, the trial court did not err in failing to

consider the application of res judicata, as the matter was not properly raised and was not before

the court. Accordingly, the judgment of the trial court will be affirmed.

I. Facts and Course of Proceedings

{¶ 5} In August 2009, the Hindu Temple and Community Center of Georgia, Inc.

(“Hindu Temple”), filed a bankruptcy petition in the United States Bankruptcy Court for the

Northern Division of Georgia. See In re Hindu Temple and Community Center of Georgia, Inc.,

Bankr. N.D. Ga. No. 09-82915, 2013 WL 8214672, *3 (March 5, 2013). Lloyd Whitaker was

appointed as Chapter 11 Trustee in November 2009. Id. at *4. In the same month, the Trustee

filed a complaint commencing an adversary proceeding against Annamalai, a number of

individuals with whom Annamalai was associated, and a corporate entity that Annamalai

controlled. In re Hindu Temple and Community Center of Georgia, Inc., 502 B.R. 881, 884

(Bankr.N.D.Ga. 2013).

{¶ 6} “The complaint [in the adversary proceeding] was subsequently amended to

drop certain defendants and to add new defendants, including several other corporate entities

controlled by Mr. Annamalai, one of which is Paru Selvam, LLC. The complaint as amended

contained several counts against various defendants, including counts for avoidance and recovery

of fraudulent transfers made by the Debtor to Mr. Annamalai and a count based on the alter ego

doctrine. In the alter ego count, the Trustee alleged that Mr. Annamalai was the alter ego of the

Debtor and that two other corporate defendants, including Paru Selvam, LLC, were his alter egos,

making all of them liable for the debts of the Debtor. After more than two years of litigation, the

[bankruptcy] Court conducted a trial in the Adversary Proceeding in July 2012.” Id. 4

{¶ 7} During the pendency of the bankruptcy proceedings, Paru Selvam, LLC (“Paru”)

purchased real property in downtown Dayton, Ohio, located at 32-34 North Main Street, and

known as the Old Key Bank Building (“Key Bank Property”). The purchase was made on April

10, 2010. While Paru and Annamalai were awaiting trial in the adversary proceeding, Paru

conveyed the Key Bank Property to Siddhar on April 5, 2012. Siddhar was another company

allegedly controlled by Annamalai.

{¶ 8} In September 2012, the bankruptcy court entered a partial judgment against

Annamalai and others on certain counts of an amended complaint, and also submitted proposed

findings of fact and conclusions of law on other counts, including the alter ego count against

Paru. In re Hindu Temple, 502 B.R. at 885. Subsequently, in January 2013, the District Court

for the Northern District of Georgia adopted the Bankruptcy Court’s proposed findings of fact

and conclusions of law in the adversary proceeding, and entered judgment against Annamalai,

Paru, and others, for money damages. Id.

{¶ 9} In the adversary proceeding, the Trustee was given an award of $1,430,795

jointly and severally against Annamalai and Paru, plus the amount of claims allowed as of the

date of the judgment in the bankruptcy case against the Hindu Temple, less the amount of claims

subsequently disallowed. Doc. #1, Complaint, ¶ 6-8, and Ex. A attached to the Complaint.

This judgment occurred in January 2013. Id.

{¶ 10} In May 2013, the Montgomery County Treasurer filed a foreclosure action

against Siddhar and Paru in the Common Pleas Court for Montgomery County, Ohio, based on

delinquent taxes of approximately $175,000. This action was designated as Case No. 2013 CV

03168. After the foreclosure action was filed, Siddhar transferred the Key Bank Property to

Ashok on June 23, 2013. 5

{¶ 11} The Trustee then filed a complaint against Paru, Siddhar, and Ashok on July 8,

2013, in the Common Pleas Court for Montgomery County, Ohio. This action was designated

as Case No. 2013 CV 04016. The Trustee set out the facts pertaining to the bankruptcy

proceedings in Georgia, and alleged that Annamalai controlled Paru, Siddhar, and Ashok, and

that these companies were Insiders of Paru and of each other for purposes of R.C. 1336.01(G).

In addition, the Trustee contended that both Paru and Siddhar were debtors of the Trustee when

they transferred the real estate. The Trustee further alleged that the transfers to Siddhar and

Ashok were made with actual intent to hinder, delay or defraud creditors, and were made without

reasonably equivalent value from the transferees, at a time when the transferors reasonably

believed they would be found liable for debts that they otherwise would not be able to pay,

leaving the transferors substantially without assets to cover the debts.

{¶ 12} In view of the foregoing facts, the Trustee asked the court to set aside the

transfers to Siddhar and Ashok so that the real estate could be treated as an asset of Paru for

purposes of satisfying the Trustee’s judgment. The Trustee also asked the court to prohibit

further transfers of the Key Bank Property, and to appoint a receiver to take possession of the real

estate pending the lawsuit.

{¶ 13} After the court granted a temporary restraining order prohibiting further

transfers of the building without prior court approval, a magistrate held a preliminary injunction

hearing in July 2013. Following a hearing, the magistrate issued a preliminary injunction,

concluding that, among other things, the Trustee had shown a likelihood of success on the merits

of the fraudulent transfer claim. None of the defendants appeared for the hearing, but shortly

thereafter, counsel for Ashok entered an appearance in the action and filed objections to the

magistrate’s order. Shortly after filing the objections, counsel for Ashok was granted permission 6

to withdraw as counsel.

{¶ 14} In early September 2013, Annamalai filed a motion to intervene in the

fraudulent transfer action, claiming that he had an interest in the litigation based on the judgment

that had been rendered against him and Paru in the bankruptcy court. Annamalai also filed an

answer, but the trial court struck the answer because Annamalai was not yet a party to the action.

The court then consolidated the foreclosure and fraudulent transfer actions.

{¶ 15} An agreed entry was filed on October 3, 2013, granting Annamalai’s motion to

intervene. The entry noted that for purposes of this case, Paru and Annamalai were liable

interchangeably for each other’s debts, including any debt owed the Trustee as a result of the

bankruptcy case. On October 12, 2013, Annamalai filed an answer, pro se.

{¶ 16} Prior to the time that Annamalai filed his answer, the Trustee had been

attempting to perfect service on Paru, Ashok, and Siddhar. On October 16, 2013, a return of

personal service was filed, indicating that service had been perfected for these parties, by making

personal service on Annamalai on October 15, 2013. Annamalai then filed a “notice”

contending that the service of process had been “fraudulent,” and denying that he was an agent of

Paru, Ashok, and Siddhar for purposes of service of process.

{¶ 17} After Paru, Ashok, and Siddhar failed to file answers, the Trustee moved for

default judgment on November 13, 2013. Annamalai then filed a motion to strike the motion for

default judgment. However, Annamalai did not sign the motion; it was signed by someone else

“by permission.” On December 24, 2013, counsel for Siddhar and Ashok filed a memorandum

in opposition to the motion for default judgment and a motion for leave to file an answer and

counterclaim. They filed another memorandum opposing default judgment on December 30,

2013. 7

{¶ 18} Subsequently, in February 2014, the trial court ruled on all pending motions,

including the motion for default judgment. As pertinent here, the court overruled the objections

to the magistrate’s report and adopted the magistrate’s decision granting the preliminary

injunction prohibiting transfers of the Key Bank Property. The court also concluded that Paru,

Siddhar, and Ashok had been properly served, and granted default judgment against these

defendants. In addition, the trial court held that Annamalai could not rebut the presumption of

service on the defendants, and could not respond to the default judgment motion because the

court had only permitted Annamalai to intervene in accordance with his individual interests.

Finally, the court overruled the motion of Ashok and Siddhar for leave to file an answer and

counterclaim, as well as Annamalai’s motion for leave to file an amended answer and

counterclaim.

{¶ 19} Annamalai, Ashok, and Siddhar appeal from the judgment of the trial court.

Paru did not file a notice of appeal from the judgment.

{¶ 20} For purposes of convenience, we will first address the assignments of error

raised by Ashok and Siddhar (collectively, the “Corporate Defendants”). We will then consider

Annamalai’s assignments of error.

II. Did the Trial Court Err in Granting Default Judgment?

{¶ 21} The Corporate Defendants’ First Assignment of Error states that:

The Trial Court Erred in Granting Default Judgment in Favor of the

Appellee in This Case When There Had Been No Service of Process Upon the

Appellants.

{¶ 22} Under this assignment of error, the Corporate Defendants argue that the trial 8

court lacked personal jurisdiction over them because Annamalai was not an authorized agent and

did not have authority to accept service. They also contend that service upon Annamalai would

not be reasonably calculated to provide notice to them.

{¶ 23} “In Mullane v. Cent. Hanover Bank & Trust Co. (1950), 339 U.S. 306, 70 S.Ct.

652, 94 L.Ed. 865, the United States Supreme Court enunciated the standard for determining

whether service of process comports with due process, holding: ‘An elementary and fundamental

requirement of due process in any proceeding which is to be accorded finality is notice

reasonably calculated, under all the circumstances, to apprise interested parties of the pendency

of the action and afford them an opportunity to present their objections.’ ” In re Thompkins, 115

Ohio St.3d 409, 2007-Ohio-5238, 875 N.E.2d 582, ¶ 13, quoting Mullane at 314.

{¶ 24} In the trial court, the Corporate Defendants filed an affidavit of their president,

Parvathi Sivanadiyan (“Parvathi”), who stated that both Ashok and Siddhar are foreign

corporations who are not licensed to do business in Ohio and do not have a statutory agent in

Ohio.1

{¶ 25} With respect to service on defendants outside the state, Civ.R. 4.3(A) provides

that:

Service of process may be made outside of this state, as provided in this

rule, in any action in this state, upon a person who, at the time of service of

process, is a nonresident of this state or is a resident of this state who is absent

from this state. “Person” includes an individual, an individual's executor,

administrator, or other personal representative, or a corporation, partnership,

1 Parvathi is the wife of Intervening Defendant, Annamalai. 9

association, or any other legal or commercial entity, who, acting directly or by an

agent, has caused an event to occur out of which the claim that is the subject of

the complaint arose, from the person's:

(1) Transacting any business in this state:

***

(6) Having an interest in, using, or possessing real property in this state * *

*.

{¶ 26} According to the complaint, both Ashok and Siddhar owned real property in the

State of Ohio pursuant to the alleged fraudulent transfers. Thus, under Civ.R. 4.3(B), they could

have been served by the clerk using United States certified or express mail, by a commercial

carrier, or by personal service. See Civ.R. 4.1(A)(1) and (A)(3). The Trustee attempted to

serve Ashok and Siddhar by certified mail a number of times, and then made personal service on

them through Annamalai.

{¶ 27} Where plaintiffs follow the Ohio Civil Rules that govern service of process,

“courts presume that service is proper unless the defendant rebuts this presumption with

sufficient evidence of nonservice.” (Citations omitted.) Money Tree Loan Co. v. Williams, 169

Ohio App.3d 336, 2006-Ohio-5568, 862 N.E.2d 885, ¶ 10 (8th Dist.). The Corporate

Defendants contend that they rebutted the presumption of proper service based on Parvathi’s

affidavit, which states that Annamalai was not an officer or authorized agent of Ashok or

Siddhar, and was not authorized to accept service of process on their behalf.

{¶ 28} Civ.R. 4.2(F) provides that service of process, as authorized by the Ohio Civil

Rules, shall be made “[u]pon a corporation either domestic or foreign: by serving the agent

authorized by appointment or by law to receive service of process; or by serving the corporation 10

at any of its usual places of business by a method authorized under Civ.R.4.1(A)(1); or by

serving an officer or a managing or general agent of the corporation * * *.”

{¶ 29} This rule does not define the term “general agent.” However, a “general agent”

has been defined as “an agent authorized to conduct a series of transactions involving a

continuity of service.” Sheriff Electric Service v. Greater Allen Ame Church, 2d Dist.

Montgomery No. 7628, 1982 WL 3784, *1 (Aug. 25, 1982), citing Restatement of the Law 2d,

Agency, Section 3 (1958).

{¶ 30} In contrast to Parvathi’s affidavit, the record before the trial court was replete

with evidence that Annamalai was a general agent of the Corporate Defendants. In this regard,

we stress that “[i]n determining whether a defendant has sufficiently rebutted the presumption of

valid service, a trial court may assess the credibility and competency of the submitted evidence

demonstrating non-service.” (Citation omitted.) Bowling v. Grange Mut. Cas. Co., 10th Dist.

Franklin No. 05AP-51, 2005-Ohio-5924, ¶ 33.

{¶ 31} As a preliminary point, we note that Parvathi never denied that the Corporate

Defendants had received service; she only denied that her husband, Annamalai, was authorized to

receive it. Again, however, the facts indicate otherwise. An affidavit attached to the Trustee’s

motion for a temporary restraining order indicates the following facts: Paru purchased the Key

Bank Property for $525,000 in April 2010, after the bankruptcy case had been filed. Paru was

one of the parties involved in the bankruptcy, and no mortgage or other financing securing the

purchase was reflected. With a trial in the bankruptcy case imminent, Paru conveyed the

property to Siddhar, without any consideration. Annamalai controlled Siddhar and Paru, and his

personal e-mail address included the designation “Siddhar Peedam Group of Temples.”

Affidavit of Ronald Kozar, p. 1, attached to Doc. #6. 11

{¶ 32} The Kozar affidavit further indicated that after a judgment of more than one

million dollars was entered jointly and severally against Paru and Annamalai in the bankruptcy

case, a foreclosure case was filed against Paru and Siddhar in the Montgomery County Common

Pleas Court of Common Pleas. Shortly thereafter, Siddhar conveyed the property to Ashok,

without any consideration.

{¶ 33} Furthermore, evidence at the preliminary injunction hearing indicated that

Siddhar shared the same address as Paru, i.e., 32 North Main Street, Dayton, Ohio, and also

shared a leading officer who appeared to be Annamalai’s employee or assistant. Likewise,

Ashok and Paru shared an officer. In addition, Annamalai’s wife, Parvathi, was an officer of

both Ashok and Paru, and was Ashok’s registered agent. Based on these facts and others, the

magistrate concluded that Annamalai, who had been notified of the injunction hearing, was so

associated with the Corporate Defendants that notice to him should be considered notice to them.

{¶ 34} Moreover, when Ashok’s counsel entered an appearance for Ashok and filed

objections to the magistrate’s decision, Ashok did not say that it had failed to receive notice of

the preliminary injunction hearing; instead, Ashok said it did not receive notice of the injunction

hearing “in time to allow it to reach terms with an attorney to appear on its behalf.” Doc. #24, p.

5. However, Annamalai and an attorney associated with Annamalai were the only individuals

notified about the injunction hearing.

{¶ 35} Moreover, when Annamalai filed his motion to intervene in the present action, he

indicated that he had already been deemed the alter ego of Paru in the bankruptcy litigation. As

a further matter, after the preliminary injunction was granted, Annamalai, acting on behalf of

Ashok, offered a prospective buyer various options for the purchase of the Key Bank Property. 12

See Doc. #74, Ronald Kozar Affidavit, ¶ 2-5, and Exhibit A attached to the Kozar Affidavit. In

the e-mail offering the purchase options, Annamalai used the name “Dr. Selvam.” Annamalai

uses this name, as well as Annamalai Annamalai, and the title of “Dr. Commander Selvam,” to

refer to himself. See, e.g., Doc. #104, Reply of Defendant Annamalai for Motion for Sanctions

Against Mr. Kozar & Mr. Whitaker, and emails attached to that motion.

{¶ 36} The e-mail Annamalai sent regarding the potential sale of the Key Bank

Property also referenced the website of www.siddharpeedam.org. On October 16, 2013 (during

the lawsuit), this website contained a picture of Annamalai, welcoming visitors to the worldwide

website of “Siddhar Peedam Group of Temples, Centers, and Ashrams.” Doc. #106,

Memorandum Opposing Motion of October 25, Affidavit of Ronald Kozar, ¶ 2-3, and Exhibit A,

p. 1, attached to the Kozar Affidavit. On the website, Annamalai referred to himself as

“Commander Selvam,” “Dr. Commander Selvam,” and “Swami Sri Selvam Siddhar.” He also

provided his own email address (“avtemples.aol.com”) as the source of information to visitors.

Id. at pp.2-3. In this regard, the website stated that:

Please visit other pages, our associate web sites and videos. For any more

additional information or to schedule an appointment with Guru Maharaj Swamiji

Sri Selvam Siddar Dr Commander Selvam, please email us at avtemples.aol.com 2 or call us in USA. * * *

Id. at p. 3.

{¶ 37} Accordingly, the record contains substantial evidence supporting the trial

court’s decision that service of process was complete with regard to the Corporate Defendants,

2 This is the same email address that Annamalai used when offering, on Ashok’s behalf, the various options for the purchase of the Key Bank Property. 13

due to the personal service that Annamalai accepted on behalf of these defendants. The

Corporate Defendants’ First Assignment of Error is overruled.

III. Was There Proper Notice of the Default Judgment?

{¶ 38} The Corporate Defendants’ Second Assignment of Error states that:

The Trial Court Erred by Granting the November 13, 2013 Motion for

Default Judgment of the Appellee and by Denying the Motion for Leave of the

Appellants Without Giving the Appellants the Required Seven Days Notice of Its

Intention to Award Default Judgment Required by Civ.R. 55(A).

{¶ 39} Under this assignment of error, the Corporate Defendants contend that the trial

court failed to comply with Civ.R. 55(A), because it did not provide them with written notice of

the application for default judgment at least seven days prior to the hearing on the motion. In

this regard, the Corporate Defendants rely on the fact that they had appeared in the action and

were entitled to notice.

{¶ 40} As a preliminary matter, we note that we review a trial court’s decision to grant

a default judgment for abuse of discretion. See, e.g., Mueller v. Hammann, 1st Dist. Hamilton

Nos. C-120799, C-130231, 2013-Ohio-5098, ¶ 7, citing Zuljevic v. Midland-Ross Corp. Unicast

Div., 62 Ohio St.2d 116, 403 N.E.2d 986 (1980).

{¶ 41} The requirements for default judgments are outlined in Civ.R. 55(A), which

provides that:

When a party against whom a judgment for affirmative relief is sought has

failed to plead or otherwise defend as provided by these rules, the party entitled to

a judgment by default shall apply in writing or orally to the court therefor; but no 14

judgment by default shall be entered against a minor or an incompetent person

unless represented in the action by a guardian or other such representative who

has appeared therein. If the party against whom judgment by default is sought

has appeared in the action, he (or, if appearing by representative, his

representative) shall be served with written notice of the application for judgment

at least seven days prior to the hearing on such application. If, in order to enable

the court to enter judgment or to carry it into effect, it is necessary to take an

account or to determine the amount of damages or to establish the truth of any

averment by evidence or to make an investigation of any other matter, the court

may conduct such hearings or order such references as it deems necessary and

proper and shall when applicable accord a right of trial by jury to the parties.

{¶ 42} According to the record, the default judgment motion was filed on November

13, 2013. Ashok had previously appeared in the action by filing objections to the magistrate’s

report, but had never filed an answer. Siddhar and Ashok also appeared thereafter, by filing a

combined motion in opposition to the motion for default judgment and motion for leave to file an

answer and counterclaim on December 24, 2013. They also filed a second motion in opposition

to the default judgment motion on December 30, 2013. Thus, they had appeared in the action

and were entitled to notice of the application for default judgment under Civ.R. 55(A).

{¶ 43} The motion for default judgment contains a certificate of service indicating that

it was served on Ashok and Siddhar on November 13, 2013, and indeed, they did receive notice

of the motion, because they replied to it. The Trustee also filed a notice of pending motions,

including the default judgment motions, on December 5, 2013, and served the notice on Ashok

and Siddhar by regular mail. 15

{¶ 44} In their motions opposing default judgment, the Corporate Defendants did not

raise the issue of Civ.R. 55(A). Instead, their sole argument related to the alleged lack of proper

service of process. After receiving memoranda from both sides, the trial court issued a decision

granting the default judgment on February 3, 2014. The trial court did not file a notice of a

hearing on the motion. However, we conclude that notice was not required under the

circumstances involved in this case. Furthermore, assuming for purposes of argument that a

procedural irregularity occurred, it was waived by the Corporate Defendants.

{¶ 45} In Asset Acceptance LLC v. Springer, 2d Dist. Montgomery No. 20263,

2004-Ohio-5934, we stated that “[t]he evident purpose of the requirement in Civ.R. 55(A) for at

least seven days written notice prior to the hearing on an application for default judgment is to

allow the respondent an opportunity, either in writing, or by appearing at the hearing, to show

cause why default judgment should not be entered.” Id. at ¶ 9.

{¶ 46} As we noted previously, “ ‘[a]n elementary and fundamental requirement of due

process in any proceeding which is to be accorded finality is notice reasonably calculated, under

all the circumstances, to apprise interested parties of the pendency of the action and afford them

an opportunity to present their objections.’ ” In re Thompkins, 115 Ohio St.3d 409,

2007-Ohio-5238, 875 N.E.2d 582, at ¶ 13, quoting Mullane, 339 U.S. at 314, 70 S.Ct. 652, 94

L.Ed. 865. In the case before us, the defendants received an opportunity to show in writing why

the default judgment should not be entered, and availed themselves of the opportunity.

Therefore, the Corporate Defendants received all process that they were due.

{¶ 47} In this regard, we note that we have reviewed the application of Civ.R. 55(A) in

many default judgment cases from this district. The case before us is unlike these other cases,

which typically involve default judgments that were granted immediately or within a few days 16

after the application, without the opposing party having been notified of the application, and

without the opposing party having actually responded to the motion. See, e.g., Asset Acceptance

at ¶ 6 (motion granted the day after it was filed); April Ents., Inc. v. Estate of McCabe, 2d Dist.

Montgomery No. 24065, 2011-Ohio-3271, ¶ 10 (default judgment granted the day after the

motion was filed); Wells Fargo Fin. Natl. Bank v. Douglas, 2d Dist. Montgomery No. 24349,

2011-Ohio-3739, ¶ 8-9 (default judgment granted the same day that the motion was filed); and

Miamisburg Motel v. Huntington Natl. Bank, 88 Ohio App.3d 117, 121, 623 N.E.2d 163 (2d

Dist.1993) (default judgment granted the same day that the motion was filed). Under the

circumstances, we cannot see how the Corporate Defendants would have benefitted from further

process – or how they were prejudiced. The Corporate Defendants have also not suggested how

they would have benefitted.

{¶ 48} Furthermore, assuming for purposes of argument that the trial court committed a

procedural error by failing to file a “hearing” notice, the Corporate Defendants waived the right

to object because they did not raise this matter in the trial court. “A party who fails to bring an

alleged error to the trial court's attention waives the right to assert that error on appeal.”

Ashmore v. Eversole, 2d Dist. Montgomery No. 15672, 1996 WL 685568, *6 (Nov. 29, 1996),

citing LeFort v. Century 21-Maitland Realty Co., 32 Ohio St.3d 121, 123, 512 N.E.2d 640

(1987). Even where error has been waived, we may still recognize plain error. However, “[t]he

plain-error doctrine is not favored in appeals of civil cases, ‘and may be applied only in the

extremely rare case involving exceptional circumstances where error, to which no objection was

made at the trial court, seriously affects the basic fairness, integrity, or public reputation of the

judicial process, thereby challenging the legitimacy of the underlying judicial process itself.’ ”

Stewart v. Nazir, 2d Dist. Montgomery No. 23806, 2010-Ohio-6346, ¶ 26, quoting Goldfuss v. 17

Davidson, 79 Ohio St.3d 116, 679 N.E.2d 1099 (1997), syllabus. For the reasons previously

mentioned, the case before us does not involve exceptional circumstances warranting application

of the plain error doctrine.

{¶ 49} In arguing that the default judgment should be reversed, the Corporate

Defendants contend that any alleged failure to comply with Civ.R. 55(A) renders the judgment

void. However, we disagree. We have previously held that:

Assuming, for the sake of argument, that [the defendant] had made an

appearance entitling it to notice, its failure to receive such notice of the hearing on

the motion for default judgment made the judgment voidable, but not void. See

Miamisburg Motel, 88 Ohio App.3d [at]118 [,623 N.E.2d 163] (affirming the trial

court's refusal to vacate judgment because the motion to vacate was untimely,

notwithstanding lack of notice of the application for default judgment). But, see,

Plant Equip., Inc. v. Nationwide Control Serv. Inc. (2003), 155 Ohio App.3d 46,

798 N.E.2d 1202. As such, [the defendant’s] failure to raise this issue in the trial

court when it filed its Civ.R. 60(B) motion waived it for purposes of appeal.

Gentile v. Ristas, 160 Ohio App.3d 765, 2005-Ohio-2197, 828 N.E.2d 1021, ¶ 74.

Natl. City Mtge. Co. v. Johnson & Assoc. Financial Servs., Inc., 2d Dist. Montgomery No.

21164, 2006-Ohio-2364, ¶ 16.

{¶ 50} Other districts have reached the same conclusion. See, e.g., Deutsche Bank

Natl. Trust Co. v. Lagowski, 7th Dist. Belmont No. 10 BE 28, 2012-Ohio-1684, ¶ 52-54; GMAC

Mtge., L.L.C. v. Lee, 10th Dist. Franklin No. 11AP-796, 2012-Ohio-1157, ¶ 15; and Aurora Loan

Servs., L.L.C. v. Cart, 11th Dist. Ashtabula No. 2010-A-0024, 2011-Ohio-2450.

{¶ 51} Accordingly, the Second Assignment of Error is overruled. 18

IV. Did the Default Judgment Motion Conform to Civ.R. 55(C)?

{¶ 52} The Corporate Defendants’ Third Assignment of Error states that:

The Trial Court Erred by Granting the November 13, 2013 Motion for

Default Judgment of the Appellee When Said Motion Did Not Conform With the

Requirements of Civ.R. 55(C).

{¶ 53} Under this assignment of error, the Corporate Defendants contend that the trial

court abused its discretion in granting default judgment because the Trustee’s motion failed to

comply with Civ.R. 55(C), which subjects all default judgments to Civ.R. 54(C).

{¶ 54} Civ.R. 55(C) states that “[i]n all cases a judgment by default is subject to the

limitations of Rule 54(C).” In turn, Civ.R. 54(C) provides that “[a] judgment by default shall

not be different in kind from or exceed in amount that prayed for in the demand for judgment.”

{¶ 55} “The primary purpose of Civ. R. 54(C)'s limitations on default judgments is to

ensure that defendants are clearly notified of the maximum potential liability to which they are

exposed, so that they may make an informed, rational choice to either: (1) enable a default

judgment by not responding, or (2) invest the time and expense involved in defending an action.

The plain language of Civ. R. 54(C) unequivocally requires this notification of the maximum

potential liability to be communicated through a demand for judgment in the complaint.”

(Citation omitted.) National City Bank v. Shuman, 9th Dist. Summit No. 21484,

2003-Ohio-6116, ¶ 11.

{¶ 56} We applied this rule in Thomason v. Hamilton, 2d Dist. Greene No. 07-CA-60,

2008-Ohio-3492, where the amount awarded on default judgment exceeded the amount properly

warranted by the complaint. Specifically, the plaintiff had requested attorney fees in the 19

complaint, which he was not entitled to receive. We, therefore, reversed the judgment with

respect to the damages, and remanded the case for recalculation of damages. Id. at ¶ 9-10.

{¶ 57} In the case before us, the complaint alleged that the transfers of the Key Bank

Property to the Corporate Defendants were fraudulent and were made with intent do hinder or

defraud creditors. The complaint further alleged that the Corporate Defendants received the real

estate for no or inadequate consideration. The Trustee, therefore, asked the court to set aside the

transfers to the Corporate Defendants and issue an order prohibiting any further transfers of the

real estate. Doc. #1, Complaint, ¶ 16. This is the same relief that the trial court granted in the

default judgment. Doc. #120, pp. 30-31.

{¶ 58} Based on the preceding discussion, the Third Assignment of Error is overruled.

{¶ 59} Having overruled all the assignments of error of the Corporate Defendants, we

will now consider Annamalai’s assignments of error.

V. Did the Trial Court Err in Entering Default Judgment Against Annamalai?

{¶ 60} Annamalai’s First Assignment of Error states that:

The Trial Court Erred in Entering a Default Judgment Against Annamalai.

{¶ 61} Under this assignment of error, Annamalai contends, without discussion, that

the trial court erred in entering a default judgment against him. However, the trial court did not

enter a default judgment against Annamalai. Annamalai was not named as a party in the

complaint, and the trial court allowed him to intervene solely for purposes of protecting his own

interests, since he was liable jointly and severally with Paru. However, no default judgment was

rendered against Annamalai in the fraudulent conveyance action.

{¶ 62} Annamalai’s brief is not well-organized, as he also challenges service of process 20

without connecting it to a specific assignment of error. To the extent that Annamalai’s

discussion of the issues in his brief contests service of process, his arguments have been

previously considered and rejected in our discussion of the Corporate Defendants’ First

Assignment of Error.

{¶ 63} Accordingly, Annamalai’s First Assignment of Error is overruled.

VI. Did the Trial Court Fail to Comply with Civ.R. 55(A)?

{¶ 64} Annamalai’s Second Assignment of Error states that:

The Trial Court Erred in Failing to Give 7 Days Notice and Hearing

Before Granting Default Judgment Pursuant to the Provisions of Civ.R. 55(A).

{¶ 65} This assignment of error raises arguments that have already been considered and

rejected in connection with the Corporate Defendants’ Second and Third Assignments of Error.

Annamalai is also in a different position than the Corporate Defendants. No default judgment

was rendered against Annamalai. As the trial court noted, Annamalai was only allowed to

intervene in order to protect his own interests; he was not permitted to represent the interests of

the Corporate Defendants, since he was not an attorney. In this regard, R.C. 4705.01 provides

No person shall be permitted to practice as an attorney and counselor at

law, or to commence, conduct, or defend any action or proceeding in which the

person is not a party concerned, either by using or subscribing the person's own

name, or the name of another person, unless the person has been admitted to the

bar by order of the supreme court in compliance with its prescribed and published

rules. 21

{¶ 66} Although Annamalai had the right to file pleadings on his own behalf, he was

not an attorney, and did not have the right to file pleadings or to assert claims and defenses on

behalf of the other parties. What Annamalai cannot do explicitly, he also cannot do implicitly.

Accordingly, Annamalai’s Second Assignment of Error is overruled.

VII. Did the Trial Court Err in Overruling the Motion

for Leave to File an Amended Answer and Counterclaim?

{¶ 67} Annamalai’s Third Assignment of Error states that:

The Trial Court Erred in Denying the Appellant Leave to File His

Amended Answer and Counterclaim and in Failing to Allow Him an Opportunity

to Pursue Those Claims and the Affirmative Defense of Res Judicata.

{¶ 68} Under this assignment of error, Annamalai contends that the trial court erred in

refusing to allow him to file an amended answer and counterclaim to assert the affirmative

defense of res judicata. Annamalai filed his original answer on October 12, 2013, after being

given permission by the trial court to intervene. Subsequently, on December 5, 2013,

Annamalai filed a motion for leave to file an amended answer and counterclaim. The amended

answer that was attached raised various affirmative defenses, including res judicata and unclean

hands. The attached counterclaim asserted claims of fraud, defamation, conspiracy, fraudulent

liens, and intentional infliction of emotional distress. The motion for leave was not signed by

Annamalai; his name was signed by an unidentified person, “by permission.” See Doc. #111, p.

9.

{¶ 69} The trial court overruled the motion as moot and struck it from the record, based

on the fact that the default judgment had been granted. The court had also previously held that 22

Annamalai’s memorandum opposing the default judgment should be struck from the record

because it was signed by an undisclosed party “by permission” on behalf of Annamalai, in

violation of Civ.R. 11.

{¶ 70} In responding to Annamalai’s argument, the Trustee maintains that the motion

for leave was not signed as required by Civ.R. 11. The Trustee further argues that the motion

failed to comply with Civ.R. 7(B)(1) because it was not properly styled, and also contained

scandalous and insulting allegations that would have to be struck under Civ.R. 12(F), even if

leave to amend had been granted.

{¶ 71} Civ.R. 15(A) provides that:

A party may amend its pleading once as a matter of course within

twenty-eight days after serving it or, if the pleading is one to which a responsive

pleading is required within twenty-eight days after service of a responsive

pleading or twenty-eight days after service of a motion under Civ.R. 12(B), (E), or

(F), whichever is earlier. In all other cases, a party may amend its pleading only

with the opposing party's written consent or the court's leave. The court shall

freely give leave when justice so requires.

{¶ 72} Because more than 28 days had elapsed since the filing of Annamalai’s answer,

he was required to obtain the court’s leave to file an amended answer. “Despite the liberal

policy in granting motions to amend, the appellate review of a trial court's decision regarding a

motion to amend consists of determining whether the trial judge's decision was an abuse of

discretion, not whether it was the same decision we might have made.” State ex rel. Rogers v.

Republic Environmental Sys., Inc., 2d Dist. Montgomery Nos. 23513, 23644, 23723,

2010-Ohio-5523, ¶ 36, citing Wilmington Steel Products, Inc. v. Cleveland Electric 23

Illuminating Co., 60 Ohio St.3d 120, 122, 573 N.E.2d 622 (1991). (Other citation omitted.) “

‘Abuse of discretion’ has been defined as an attitude that is unreasonable, arbitrary, or

unconscionable.” Id., quoting Huffman v. Hair Surgeon, Inc., 19 Ohio St.3d 83, 87, 482 N.E.2d

1248 (1985).

{¶ 73} After applying this standard, we conclude that the trial court did not abuse its

discretion in refusing to allow amendment of the answer. We have read the entire docket and

make the following observations. First, we note that the action had been pending for a

considerable period of time before Annamalai asked for leave to amend his answer and file a

counterclaim. Annamalai originally attempted to intervene in September 2013 and tendered an

answer at that time, which the court struck because he was not yet a party. Between that time

and the request to file the amended answer and counterclaim, Annamalai filed many pleadings, in

which he made the assertions being raised in the amended answer and counterclaim, including

the fact that the Trustee’s claim was barred by the findings in the prior bankruptcy action. See,

e.g, Doc. #75, Reply Brief - Memorandum in Support of Annamalai Annamalai’s Motion to

Intervene, filed on September 23, 2013, p. 2.

{¶ 74} Since Annamalai was apparently aware of this alleged defense before he filed

his answer in October 2013, there is no reason why he could not have asserted res judicata then.

Although Annamalai is a pro se litigant, “[l]itigants who choose to proceed pro se are presumed

to know the law and correct procedure, and are held to the same standards as other litigants.”

Yocum v. Means, 2d Dist. Darke No. 1576, 2002-Ohio-3803, ¶ 20, citing Kilroy v. B.H.

Lakeshore Co., 111 Ohio App.3d 357, 363, 676 N.E.2d 171 (8th Dist.1996).

{¶ 75} As an additional matter, while the actions were pending in the trial court,

Annamalai was held in contempt by the bankruptcy court, based on the fact that he had filed a 24

complaint in the United States District Court for the Southern District of Ohio against Ronald

Kozar, the attorney representing the Trustee in the case before us, the wives of both Kozar and

the Trustee, and various other parties. See In re Hindu Temple, 502 B.R. at 891.

{¶ 76} Annamalai’s 90-page federal complaint was filed on July 29, 2013, and

requested “$125 million in compensatory and punitive damages in connection with an alleged

conspiracy to defame and destroy Annamalai and a temple he had formed in Ohio.” Id. at 886.

A number of the allegations and claims in the federal action are similar to the matters alleged in

the proposed answer and counterclaim, as well as other documents in the case before us. The

allegations in the federal case included claims of defamation and intentional infliction of

emotional distress, and charges that the defendants “were engaged in a conspiracy or were part of

a gang or were acting in concert to harm Mr. Annamalai,” that the defendants were attempting

to steal Annamalai’s wealth, and so on. Id. at 887-888. The bankruptcy court noted that:

“These preposterous and scurrilous accusations show the utter lack of respect that Mr. Annamalai

has for our judicial system and the rules that govern it, such as Rule 11 of the Federal Rules of

Civil Procedure.” Id. at 888.

{¶ 77} The bankruptcy court further considered whether the federal litigation violated

the Barton doctrine, which precludes lawsuits against bankruptcy receivers or trustees without

the prior approval of the bankruptcy court. Id. at 889, citing Barton v. Barbour, 104 U.S. 126,

127, 26 L.Ed. 672 (1881). “ ‘ “The usual articulation of the test for determining whether a civil

proceeding is related to bankruptcy is whether the outcome of the proceeding could conceivably

have an effect on the estate being administered in bankruptcy.” ’ ” (Citation omitted.) Id.,

quoting Carter v. Rodgers, 220 F.3d 1249, 1253 (11th Cir.2000).

{¶ 78} In discussing this issue, the bankruptcy court specifically mentioned the 25

litigation in the case before us, which it had designated as the “ ‘Building Litigation.’ ” In re

Hindu Temple, 502 B.R. at 885. In this regard, the bankruptcy court stated that:

The Court concludes that the Ohio Federal Action is related to this

bankruptcy case because its prosecution “could conceivably have an effect on the

estate being administered in bankruptcy” in that its purpose is to intimidate and

harass the Trustee so as to force him to abandon the Building Litigation and to

intimidate Mr. Kozar into abandoning his representation of Mr. Whitaker in the

Building Litigation. The Court infers this purpose for several reasons.

First, the Complaint was filed only ten days after the Trustee obtained a

preliminary injunction in the Building Litigation. The timing of the filing of the

Complaint strongly suggests that its purpose is to derail the Building Litigation.

This conclusion is further supported by the fact that the Complaint in the Ohio

Federal Action contains allegations of defamation that formed the basis of his

amended complaint in 2012 in the Ohio State Court Action against Messrs.

Kepner and Williamson. Individuals sued in the Ohio State Court Action are also

named in the Ohio Federal Action. But Mr. Annamalai, who has a propensity to

sue those who oppose him, did not sue the Spouse Defendants or apparently Mr.

Kozar in the Ohio State Court Action in 2012. These facts suggest that his

decision to include Mr. Kozar and the Spouse Defendants in the complaint was

not based on any legitimate claim against them but was instead based on an

objective of intimidating and harassing the Trustee and his professionals to drop

the Building Litigation.

Second, the Complaint alleges no facts to show that it is plausible that Mr. 26

Kozar or any of the Spouse Defendants could be liable to Mr. Annamalai under

any count of the Complaint. The Complaint thus fails to state a claim upon

which relief can be granted against Mr. Kozar and the Spouse Defendants. In his

response, Mr. Annamalai points out that it is for the District Court in Ohio to

determine whether the Complaint states a claim against the defendants on a Rule

12(b)(6) motion. That is of course true. This Court is permitted, however, to read

the Complaint and draw inferences as to its purpose. The Court infers that

because the Complaint fails to state a claim upon which relief can be granted with

respect to Mr. Kozar and the Spouse Defendants, it was brought for another

reason – to intimidate and harass the Trustee and his professionals.

Third, the conclusory allegations of criminal conduct by the spouses are so

outrageous that they can have but one purpose – to force the Trustee to end his

pursuit of collection of the judgments against Mr. Annamalai and Paru Selvam,

LLC. It is notable that Mr. Annamalai does not show that he reported his

conclusions to any law enforcement agency. Nor did he come to this Court to

seek an order that his claims had nothing to with this case or that he should be

permitted to pursue them even if they were related to this case. This strongly

suggests that Mr. Annamalai knows that his conclusory allegations are false. The

Court infers from the abusive nature of his allegations and his failure to show that

he reported alleged criminal conduct to the proper authorities that his purpose in

making those allegations was to intimidate and harass the Trustee and his

professionals into ceasing their efforts to collect the judgment against him and

Paru Selvam, LLC. 27

In re Hindu Temple, 502 B.R. at 890-891.

{¶ 79} The bankruptcy court, therefore, held Annamalai in civil contempt and awarded

a fine of $1,000 per day beginning on the date he filed the Ohio federal action, and ending when

he dismissed the claims against Kozar and the spouse defendants. Id. at 891.

{¶ 80} As was noted, Annamalai makes the same kinds of charges in the proposed

answer and counterclaim. For example, Annamalai states in the answer that the Trustee is

playing a “shell game” with Annamalai’s assets, and that the Trustee and Kozar are engaged in a

conspiracy to take over his property. Doc. #111, pp. 1-2. He also states in the counterclaim

that the Trustee “has brought this lawsuit purely to pocket as much as possible through this

litigation”; that the Trustee and his friends “are working together to collapse the personal and

business life of Annamalai”; and that the Trustee had “conspired with Mr. Kozar * * * to steal

the wealth of the defendants.” Doc. #111, pp. 5, 6, and 7.

{¶ 81} In proposing the amended answer and counterclaim, Annamalai did not offer

any evidence that the bankruptcy court had authorized his claims against the Trustee – nor would

any approval have been even remotely likely, given the decision the bankruptcy court rendered

only a few months before Annamalai attempted to file the counterclaim. Accordingly, we find

no abuse of discretion in the trial court’s decision not to allow the filing of an amended answer

and counterclaim. In light of this holding, we need not discuss the Trustee’s arguments

pertaining to the application of Civ.R. 11 – although we do note our prior authority holding that a

pro se litigant cannot authorize another, even by a power of attorney, to file pleadings on his or

her behalf, because such constitutes the unauthorized practice of law. KeyBank Natl. Assn. v.

Sarameh, 2d Dist. Montgomery No. 25411, 2013-Ohio-2576, ¶ 13.

{¶ 82} Based on the preceding discussion, Annamalai’s Third Assignment of Error is 28

overruled.

VIII. Did the Trial Court Err in Failing to Consider Arguments about Res Judicata?

{¶ 83} Annamalai’s Fourth Assignment of Error states that:

The Trial Court Erred in Failing to Consider the Appellant’s Arguments

Regarding the Res Judicata Effect of the Decision of the Bankruptcy Court for the

Northern District of Georgia.

{¶ 84} Under this assignment of error, Annamalai contends that the trial court erred in

failing to consider the affirmative defense of res judicata, which he attempted to raise in his

amended answer. According to Annamalai, findings by the bankruptcy court preclude the

Trustee from attempting to proceed against the Key Bank Property. The bankruptcy court

apparently disagreed, as it was well aware of the litigation that had been filed in Ohio to find

assets to satisfy the judgments against Annamalai and Paru. In re Hindu Temple, 502 B.R. at

885.

{¶ 85} However, putting this observation aside, the fact remains that the defense of res

judicata was never raised, because Annamalai’s amended answer was never filed. The trial

court was under no obligation to consider a matter that had not been properly raised.

Furthermore, as the trial court noted, Annamalai was only allowed to intervene in order to protect

his own interests; he was not permitted to represent the interests of the Corporate Defendants,

since he was not an attorney. As we previously noted, R.C. 4705.01 prohibits the unauthorized

practice of law.

{¶ 86} As we also have stressed, Annamalai had the right to file pleadings on his own

behalf, but he did not have the right to file pleadings or to assert claims and defenses of the other 29

parties. And, as we emphasized previously, the complaint did not ask for relief against

Annamalai, and the trial court did not render a judgment against him. Therefore, there was no

basis for considering Annamalai’s claim about res judicata. Accordingly, Annamalai’s Fourth

Assignment of Error is overruled.

IX. Conclusion

{¶ 87} All of the assignments of error of Siddhar, Ashok, and Annamalai having been

overruled, the judgment of the trial court is affirmed.

FROELICH, P.J. and FAIN, J., concur.

Copies mailed to:

Ronald J. Kozar Stephen P. Linnen Annamalai Annamalai Hon. Dennis J. Langer