ABL, Inc. v. C.T.W. Dev. Corp.
2017 Ohio 9071
| Ohio Ct. App. | 2017Background
- ABL (American Beauty Landscaping) contracted to provide lawn services for 12 properties owned by CTW; CTW paid through May 1, 2012 but disputed later charges. ABL claimed a delinquency of $14,209.37.
- ABL retained HF Holdings (a Florida collection agency) to collect the debt in February 2013. HF corresponded with CTW and negotiated a settlement on July 31, 2013.
- CTW electronically transferred $5,000 to HF on July 31, 2013; HF did not notify ABL or remit funds to ABL. ABL later sued CTW for the full debt.
- At bench trial the magistrate found HF lacked actual authority but awarded ABL $1,955.38 (after crediting $5,000). The trial court overturned the magistrate and concluded an accord and satisfaction extinguished the debt.
- ABL appealed, arguing HF had neither actual nor apparent authority and that the court miscalculated the debt. The appellate court affirmed, finding accord and satisfaction proven and HF had apparent authority.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether an accord and satisfaction extinguished CTW’s debt | HF lacked authority; ABL never consented; settlement letter was hearsay/unsigned and probative value is nil | CTW negotiated with HF, paid $5,000 to HF; HF’s letter and payment show offer, acceptance, and satisfaction | Court held there was an accord and satisfaction: offer (HF $5,000), acceptance (CTW), and satisfaction (electronic payment) |
| Whether HF had authority to settle ABL’s claim | HF had no express authority; contract required ABL approval before settling; ABL did not authorize settlement | HF was ABL’s agent and was held out to CTW as authorized; CTW reasonably relied in good faith on HF’s apparent authority | Court held HF had apparent authority based on ABL holding HF out as its collection agent and CTW’s reasonable reliance |
| Whether the unsigned HF letter was admissible and sufficient to show authority | Unsigned letter is hearsay and lacks probative value | Letter is an admission by a party opponent (agent’s statement within scope of agency) and memorializes the oral agreement | Court ruled the letter was admissible under party-opponent exception and supports apparent authority |
| Whether the magistrate’s debt calculation should control instead of trial court’s resolution | Handwritten notes used by magistrate were incomplete; billing testimony established $14,209.37 owed | If accord and satisfaction applies, calculation moot; otherwise trial process and record limitations affect review | Court found calculation issue moot because accord and satisfaction extinguished the debt; affirmed judgment |
Key Cases Cited
- Allen v. R.G. Indus. Supply, 66 Ohio St.3d 229, 611 N.E.2d 794 (Ohio 1993) (elements and analysis for accord and satisfaction)
- Master Consol. Corp. v. BancOhio Natl. Bank, 61 Ohio St.3d 570, 575 N.E.2d 817 (Ohio 1991) (standard for apparent authority)