Hunter v. Rhino Shield

237 N.E.3d 254

2024-Ohio-261

Ruth G. HUNTER, Plaintiff-Appellant,

v.RHINO SHIELD et al., Defendants-Appellees.

No. 22AP-507

Court of Appeals of Ohio, Tenth District, Franklin County.

Rendered on January 25, 2024

APPEAL from the Franklin County Court of Common Pleas (C.P.C. No. 14CV-1274).

On brief: Law Offices of James P. Connors, and James P. Connors, Columbus, for appellant. Argued: James P. Connors.

On brief: Sybert, Rhoad, Lackey & Swisher, LLC, and Dave Lackey for TriState Coating, Inc., Cleveland Coatings, Inc., Timeless Coating, Inc., and AmCoat Industries, Inc. Argued: David L. Lackey.

DECISION

MENTEL, P.J.

{¶ 1} Plaintiff-appellant, Ruth Hunter, appeals from the decision of the Franklin County Court of Common Pleas granting the motion for sanctions under R.C. 2323.51 filed by defendants-appellees, TriState Coating, LLC ("Tri-State"), Cleveland Coatings, Inc. ("Cleveland"), Timeless Coatings, Inc. ("Timeless"), and AmCoat Industries, Inc. ("AmCoat"), and denying her motion for sanctions. Arguing that this appeal is frivolous, appellees have filed a motion for sanctions under App.R. 23. Mrs. Hunter and her counsel countered with two motions requesting that this court strike a number of appellees’ briefs and memoranda. For the reasons that follow, we grant appellees’ motion, deny those of Mrs. Hunter and her counsel, and affirm the judgment of the trial court.

I. Factual and Procedural Background¹

{¶ 2} Ruth and David Hunter contracted with Tri-State on December 31, 2012, to have a protective ceramic coating called Rhino Shield applied to the exterior of their home. Dissatisfied with the result, they filed suit on February 6, 2014, alleging violations of R.C. 1345.02, the Ohio Consumer Sales Practices Act ("OCSPA"), and R.C. 1345.23, the Home Solicitation Sales Act ("HSSA"), as well as claims for breach of contract and negligent or intentional misrepresentation. Apart from Tri- State and Cleveland, the Hunters named a number of other defendants in the complaint: Rhino Shield, Tri-State Coatings and Repair LLC, John D. Robertson, Jim Williams, and Rudy Pallone. Tri-State filed an answer and third-party complaint against Alexandre Dgebuadze on March 11, 2014, alleging that he was the subcontractor who had applied Rhino Shield to the Hunters’ home.

{¶ 3} The trial court granted the Hunters leave to file an amended complaint on September 4, 2014, in which they restated the same claims while naming Timeless and AmCoat, as well as a number of additional defendants: Rhino Shield with an Indiana address, Aleksandre Dgebuadze, Rhino Shield Florida with a Florida address, and Rhino Shield with a Michigan address.

{¶ 4} Timeless filed a motion to dismiss on October 10, 2014, arguing that the trial court lacked personal jurisdiction over it under R.C. 2307.382, Ohio’s statute conferring long-arm jurisdiction over out-of-state defendants. As the dealer with "the exclusive right to advertise, sell and install Rhino Shield products within the state of Michigan," the company had "absolutely no business transactions within the state of Ohio," it argued. (Emphasis sic.) (Oct. 10, 2014 Mot. to Dismiss for Lack of Jurisdiction at 2.) According to Timeless, Tri-State was Ohio’s exclusive dealer. "The Plaintiffs were previously informed of the fact that Timeless is an unrelated company with absolutely no connection to this case, but they filed suit against Timeless anyway." Id. The trial court granted the motion on July 12, 2016, noting that although the Hunters had the burden of demonstrating personal jurisdiction, they had "never cited * * * which provisions of R.C. 2307.382 purportedly confer jurisdiction over Timeless." (July 12, 2016 Decision & Entry at 4.)

{¶ 5} Cleveland filed a motion to dismiss on April 8, 2016, arguing that it had never been served with the complaint within one year of its filing, as required by Civ.R. 3(A).

{¶ 6} On July 13, 2016, the Hunters filed a notice of partial dismissal under Civ.R. 41(A)(1)(a) "as to only the following three defendants: Cleveland Coatings, Inc., Timeless Coatings LLC, and Tri-State Coatings and Repair LLC." (Emphasis sic.) (July 13, 2016 Notice of Partial Dismissal.)

{¶ 7} AmCoat filed a notice of improper service on January 13, 2015, stating that the plaintiffs had attempted to serve it by certified mail at an improper address and providing a "proper service address." On April 26, 2016, AmCoat filed a motion to dismiss, arguing that the trial court lacked personal jurisdiction over it under Civ.R. 4.3 and R.C. 2307.382, Ohio’s long-arm statute. The trial court granted the motion and dismissed the complaint as to AmCoat on July 18, 2016.

{¶ 8} The Hunters filed a motion for reconsideration on July 21, 2016, which the trial court denied on April 25, 2017. The Hunters appealed and this court affirmed the trial court’s decision. Hunter v. Shield, 10th Dist., 2018-Ohio-2371, 115 N.E.3d 22. They then filed an application for reconsideration, an application for consideration en banc, and a motion to certify a conflict to the Supreme Court of Ohio, all of which this court denied. Hunter v. Shield, 10th Dist. No. 17AP-751 (Aug. 14, 2018) (memorandum decision). The Hunters appealed again, and the Supreme Court of Ohio declined jurisdiction. Hunter v. Shield, 154 Ohio St.3d 1432, 2018-Ohio-4670, 111 N.E.3d 1192.

{¶ 9} The Hunters filed a final notice of dismissal under Civ.R. 41(A)(1)(a) "as to the remaining defendants Rhino Shield, James H. Williams, Rudolph J. Pallone, and Tri-State Coating, Inc." on September 22, 2017, dismissing the state court action in its entirety. They refiled their case in federal district court on September 21, 2018, where they eventually recovered damages amounting to a refund of the contract price after prevailing on their HSSA claim. Hunter v. Shield, 550 F. Supp.3d 500, 510 (S.D. Ohio 2021); Hunter v. Rhino Shield, 6th Cir. No. 21-3748, 2022 WL 2952583 *8 (July 26, 2022).

{¶ 10} After the Hunters filed the secondary voluntary dismissal and before litigation resumed in federal court, Tri-State, Cleveland, Timeless, and AmCoat filed a motion seeking sanctions and attorney fees from the Hunters and their attorney. (Sept. 25, 2017 Mot.) They sought attorney fees under R.C. 1345.09 of the OCSPA, as well as attorney fees and a sanction for frivolous conduct under R.C. 2323.51. They argued that there had "never been either a factual or legal basis for the claims brought by the Plaintiffs and their counsel against Cleveland, Timeless and AmCoat. Even when confronted with the clear facts, the Plaintiffs and their counsel continued to fight to maintain these ridiculous claims." Id. at 6. They argued that the actions of the Hunters and their attorney "were not only groundless when initiated, but continuously pursued in bad faith." Id.

{¶ 11} The Hunters responded in kind with a motion for sanctions under R.C. 2323.51 and Civ.R. 11 against AmCoat, its agent Steven C. Dominique, and their attorneys. They alleged that Mr. Dominique had filed false affidavits "in the course of an ill-advised effort to thwart service of process on AmCoat," and that all three had "committed additional multiple frivolous acts" that justified an award of sanctions. (Oct. 20, 2017 Mot. at 1.)

{¶ 12} David Hunter passed away on July 27, 2018.

{¶ 13} A magistrate held a hearing on the motions on February 19, 2020, at which Ruth Hunter and her son Mark Hunter testified. On February 3, 2021, the magistrate issued a decision containing findings of fact and conclusions of law that recommended granting the appellees’ motion, awarding them $15,675 in attorney fees under R.C. 2323.51 as a sanction for frivolous conduct, and denying the Hunters’ motion for attorney fees. Ruth Hunter filed objections to the magistrate’s decision on February 17, 2021, and, with the trial court’s leave, filed supplemental objections on June 3, 2022. On July 18, 2022, the trial court overruled the objections, adopted the magistrate’s decision, and entered judgment "jointly and severally against Plaintiffs and Attorney James Connors" in the amount of $15,675 in attorney fees as a sanction under R.C. 2323.51.² (July 18, 2022 Decision & Entry at 3.)

{¶ 14} On appeal, Mrs. Hunter assigns the following as error:

[I.] THE TRIAL COURT ERRED BY ADOPTING THE MAGISTRATE’S DECISION TO GRANT APPELLEES’ CROSS MOTION FOR SANCTIONS AND BY OVERRULING [APPELLANT’S] OBJECTIONS

[II.] THE TRIAL COURT ERRED BY ADOPTING THE MAGISTRATE’S DECISION TO DENY [APPELLANT’S] CROSS MOTION FOR SANCTIONS AND BY OVERRULING [APPELLANT’S] OBJECTIONS

[1] {¶ 15} In addition to the merits of this appeal, the parties have filed a number of motions and responsive memoranda, which will be addressed after ruling on the assignments of error. Before addressing the assignments of error, we must clarify that although both Ruth Hunter and her son, Mark Hunter, purported to appeal from the trial court’s judgment, she is the only one of the two withstanding to appeal from the judgment of the trial court and is the only appellant in this case.

[2] {¶ 16} Civil Rule 25(E) states: "Upon the death or incompetency of a party it shall be the duty of the attorney of record for that party to suggest such fact upon the record within fourteen days after the attorney acquires actual knowledge of the death or incompetency of that party." "Once a suggestion of death has been filed pursuant to Civ.R. 25(E), the procedure in Civ.R. 25(A) applies." Dolin v. Lupo, 10th Dist. No. 21AP-562, 2023-Ohio-3074, 2023 WL 5624584, ¶ 20, citing Johnson v. Welch, 6th Dist. No. L-86-347, 1987 WL 12544, *2 (June 12, 1987). Civil Rule 25(A)(1) provides: "If a party dies and the claim is not thereby extinguished, the court shall, upon motion, order substitution of the proper parties. The motion for substitution may be made by any party or by the successors or representatives of the deceased party and shall be served" in accordance with the rules. Civ.R. 25(A)(1). "Unless the motion for substitution...