Cairelli v. Brunner
2016 Ohio 5535
Ohio Ct. App.2016Background
- In 1984 Cairelli (owner) leased 1318 Ashland Ave. to Richard and Jennifer Brunner and recorded a Memorandum of Lease referencing a right of first refusal (ROFR) contained in an unrecorded lease.
- Brunners occupied the property until ~1987; they produced no executed written ROFR or a surrender-of-possession document and paid no consideration to Cairelli after leaving.
- In June 2014 Cairelli contracted to sell the property to the Allmans; title search revealed the 1984 Memorandum as a cloud.
- Cairelli notified the Brunners and attempted to give them the opportunity to purchase; Brunners declined and Cairelli filed suit seeking quiet title, injunctive relief, slander of title and related claims and moved for emergency relief to clear title.
- After hearings (including August 22, 2014) the trial court found no enforceable ROFR and granted judgment quieting title to Cairelli and a permanent injunction removing the cloud; Brunners appealed.
Issues
| Issue | Plaintiff's Argument (Cairelli) | Defendant's Argument (Brunner) | Held |
|---|---|---|---|
| Whether the court improperly consolidated a preliminary-injunction hearing with a merits trial without proper notice | Consolidation was appropriate because the hearing would resolve whether a ROFR existed and the parties were informed | Consolidation denied proper notice, occurred before answer/discovery, and prevented full trial | No abuse of discretion; court provided notice on the record, parties proceeded, evidence overlapped with merits |
| Whether granting a permanent injunction/quiet title was erroneous and whether ROFR survives Statute of Frauds | Memorandum did not create an enforceable ROFR; ROFR (if any) was not in writing with essential terms and/or lacked ongoing consideration | The recorded Memorandum satisfies Statute of Frauds and Appellants retained enforceable ROFR; trial court improperly resolved merits early | Judgment affirmed: Statute of Frauds requires a signed writing with essential terms; memorandum lacked essential terms and consideration; Appellants failed to properly exercise any ROFR |
| Whether the trial court abused discretion by refusing to allow supplementation of the record with discovery-obtained evidence of alleged fraud | Supplementation would show fraudulent scheme inflating price so Brunners couldn’t meet ROFR | Evidence irrelevant to legal defects (Statute of Frauds; lack of consideration) and the offered contract to Brunners matched the Allmans’ terms | No abuse of discretion; proffered emails were not material to the court’s statutory/written-contract analysis |
| Whether counsel for plaintiff should have been disqualified under the lawyer-as-witness rule | Counsel’s affidavit concerned uncontested facts; testimonial overlap was harmless and defendant testified to same facts | Counsel was a necessary witness and should have been disqualified | No error: Prof.Cond.R.3.7 exception for testimony on uncontested issues applied; no prejudice shown |
Key Cases Cited
- George P. Ballas Buick-GMC, Inc. v. Taylor Buick, Inc., 5 Ohio App.3d 71 (Ohio Ct. App.) (consolidation without notice improper when material factual disputes require full trial)
- Turoff v. Stefanac, 16 Ohio App.3d 227 (Ohio Ct. App.) (consolidated hearing cannot dispose of merits without appropriate notice)
- N. Coast Cookies, Inc. v. Sweet Temptations, Inc., 16 Ohio App.3d 342 (Ohio Ct. App.) (memorandum satisfies Statute of Frauds only if it identifies subject, shows contract made, and states essential terms)
- Michel v. Bush, 146 Ohio App.3d 208 (Ohio Ct. App.) (claims asserting interests in land require writing signed by party to be charged under Statute of Frauds)
- Blakemore v. Blakemore, 5 Ohio St.3d 217 (Ohio 1983) (abuse-of-discretion standard defined for appellate review)