Caley v. Glenmoor Country Club, Inc.
1 N.E.3d 471
Ohio Ct. App.2013Background
- Glenmoor Country Club sold equity golf memberships (initiation fee $30,000) that, under the Membership Plan/Code of Regulations, entitled resigning equity members to repayment only after the club repurchased the membership; dues continued to accrue while on the repayment list.
- Caley and Gehring purchased equity memberships, resigned in 2011, were denied use of club facilities after resignation, and were placed on Glenmoor’s repayment list; their initiation fees were not refunded. Gehring also owed unpaid charges at resignation.
- Plaintiffs sued for return of their $30,000 initiation fees; Glenmoor counterclaimed for unpaid charges by the Gehrings (~$4,774.95).
- Trial court awarded $30,000 each to Caleys and Gehrings and awarded Glenmoor its counterclaim; both sides appealed.
- On appeal the court reversed the trial court’s finding that the membership contracts were unconscionable and that there was an enforceable oral contract conflicting with the written terms, but it affirmed breach of the written contract to the extent Glenmoor denied resigned members use of facilities prior to repurchase and remanded to calculate damages for that breach.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the membership contract is unconscionable | Caley/Gehring argued the Club’s post‑resignation policy (denying facility use and long repayment waits) was oppressive and unfairly one‑sided | Glenmoor argued members agreed to written terms and had meaningful choice; no proof of procedural or substantive unconscionability | Court: Contract not proven unconscionable; trial court’s sua sponte unconscionability finding reversed |
| Whether an oral promise (immediate refund) superseded written contract | Plaintiffs relied on testimony that club representatives orally promised refunds on resignation | Glenmoor relied on written Membership Plan/Bylaws and parol evidence rule | Court: Oral agreement cannot override clear written contract; finding of enforceable oral contract reversed |
| Whether Glenmoor breached the written contract by denying facility use after resignation | Plaintiffs argued written 1992 Code allowed facility use until membership repurchase; breach occurred when club denied access immediately after resignation | Glenmoor argued its current policy (no use after resignation) controlled | Court: 1992 Code provision (use permitted until repurchase) controls; Glenmoor breached by denying access; remanded to calculate damages for the period dues were charged but access denied |
| Whether OCSPA and negligent misrepresentation claims succeed | Plaintiffs argued they were consumers and relied on club’s representations | Glenmoor argued purchases were investment/commercial and plaintiffs failed to prove false statements or justifiable reliance | Court: OCSPA inapplicable where purchase was for investment/commercial purpose (statutory "individual" = natural person); negligent misrepresentation not proven (no established false statements); cross‑appeals denied |
Key Cases Cited
- Collins v. Click Camera and Video, Inc., 86 Ohio App.3d 826 (2d Dist. 1993) (defines procedural and substantive unconscionability factors)
- Ins. Co. of N. Am. v. Automatic Sprinkler Corp., 67 Ohio St.2d 91 (Ohio 1981) (unconscionability is a question of law)
- Alexander v. Buckeye Pipe Line Co., 53 Ohio St.2d 241 (Ohio 1978) (clear, unambiguous contract interpretation limited to four corners)
- Marion Prod. Credit Assn. v. Cochran, 40 Ohio St.3d 265 (Ohio 1988) (oral agreement cannot prevail over a signed writing on same subject matter)
- Hook v. Hook, 69 Ohio St.2d 234 (Ohio 1982) (signor bound by terms of a written contract even if not read)
- ABM Farms v. Woods, 81 Ohio St.3d 498 (Ohio 1998) (reaffirming principle that one must read what one signs)