CIG Toledo, L.L.C. v. NZR Retail of Toledo, Inc.
131 N.E.3d 351
Ohio Ct. App.2019Background
- CIG Toledo, LLC (landlord/appellee) sued NZR Retail of Toledo, Inc. (tenant/appellant) and guarantors for eviction, breach of lease and guaranties, and unjust enrichment arising from a commercial ("triple net") lease. The lease contained two fee provisions: paragraph 4 (broad indemnity including counsel fees) and paragraph 31 (attorney’s fees to prevailing party in actions to enforce the lease).
- The parties reached an oral settlement on September 21, 2016 resolving all claims except the amount of attorney’s fees, and the court retained jurisdiction to decide fees if the parties could not agree.
- Appellee moved to recover $21,921.13 (later $26,142.13) in fees; supported those figures with affidavits and an expert opinion. Appellant argued the contract only allowed fees for enforcement actions, that the unilateral fee-shifting clause was unenforceable/was not specifically negotiated, and that fees were excessive.
- The trial court treated the filing as a motion for attorney’s fees, found appellee was the prevailing party under paragraph 31, and awarded $16,866 as reasonable fees based on submitted invoices.
- On appeal, this Court reviewed scope and reasonableness of the award. It affirmed entitlement to fees under paragraph 31 but held the trial court abused its discretion by including pre-litigation/general lease-related fees. The court reduced the award to $5,550 (fees attributable to the eviction litigation from July 21–September 21, 2016) and upheld the $500 filing-related entry.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Scope of recoverable contractual fees: whether landlord may recover fees beyond fees for "actions to enforce the lease" | CIG: Paragraph 4 and paragraph 31 together justify a broad recovery; paragraph 4 (net lease) makes landlord’s counsel fees part of tenant’s expenses; fees from May 2015 onward are recoverable | NZR: Lease fee recovery is limited to fees incurred in instituting/enforcing the eviction litigation under paragraph 31; earlier, general lease-related fees are not recoverable | Held: Paragraph 31 governs; landlord entitled only to reasonable fees related to the eviction/enforcement action. Court reversed inclusion of pre-litigation general lease fees. |
| Reasonableness of specific entries (including $500 filing/service entry) | CIG: Submitted invoices and expert affidavit; all entries were reasonable and necessary | NZR: Many entries predate enforcement action and are excessive; the $500 entry for filing/service is unreasonable | Held: Overall award was excessive as originally calculated; trial court did not abuse discretion in allowing the $500 filing entry. Final award reduced to $5,550 for services directly tied to enforcement. |
Key Cases Cited
- Blakemore v. Blakemore, 5 Ohio St.3d 217 (Ohio 1983) (abuse of discretion defined as more than error of law or judgment)
- Disciplinary Counsel v. Corner, 145 Ohio St.3d 192 (Ohio 2016) (standard for when a fee is clearly excessive)
- Alexander v. Buckeye Pipeline Co., 53 Ohio St.2d 241 (Ohio 1978) (ordinary meaning of common words in contracts governs interpretation)
- City of St. Marys v. Auglaize County Bd. of Commissioners, 115 Ohio St.3d 387 (Ohio 2007) (interpretation of a contract is a matter of law reviewed de novo)