Crawford v. Hawes, 995 N.E.2d 966

Illegal contract between Crawford, Hawes, and Douglas to operate Leo’s II; Douglas obtained liquor license and lease for the bar due to their felonies; Leo’s II opened June 1, 2008; Hawes terminated Crawford after a dispute over inventory; receivership proceeding sought to protect Crawford’s interests; trial court awarded Crawford $5,809.37 for unjust enrichment and a receiver fee of $14,066.20 to Sorg; Appellate court later reversed the receiver’s fee award due to no hearing and remanded for a hearing on compensation; the court held all parties jointly and severally liable for the receiver’s compensation though the appointment of the receiver was reversed on remand; the underlying contract was illegal and the court initially barred certain claims related to the alleged partnership; the receiver’s compensation and bifurcation order were central to the issues on appeal; the final judgment affirmed in part and remanded for a hearing on the receiver’s compensation.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Hawes, Douglas, and Crawford should be jointly liable for the receiver’s fees	Crawford argues only he sought appointment; Hawes/Douglas contend joint liability is improper	Hawes/Douglas rely on Carr and similar cases to limit liability to the appointing party	Joint and several liability upheld; special circumstances support shared responsibility
Whether the trial court properly awarded fees to the Receiver without a hearing	Receiver’s fees were to be reviewed after underlying issues were tried	Court bifurcated and later awarded fees; no hearing occurred	Error; the court must hold a hearing before awarding receiver fees
Whether Crawford’s unjust enrichment award was proper	Crawford seeks greater recovery given his investment in Leo’s II	Evidence supports court’s calculation; no misweighing of damages	Unjust enrichment award affirmed; calculation not against the manifest weight of the evidence
Whether the contract/partnership claims were correctly rejected as illegal	Plaintiff asserts valid claims despite illegality	Court properly found the oral partnership illegal under public policy and RC 4303	Claims for breach of oral contract and fiduciary duties tied to the illegal contract barred; relief denied on those counts

Nah as v. George, 156 Ohio St. 52 (1951) (illegality of contract bars relief under ex turpi causa)
Richey v. Brett, 112 Ohio St. 582 (1925) (special circumstances may render parties liable for receiver’s expenses)
Carr v. Acacia Country Club Co., 2012-Ohio-4723 (8th Dist. Cuyahoga) (there is no blanket rule that the requesting party must bear all costs; context matters)
Dyczkiewycz v. Tremon Ridge Phase 1 Limited Partnership, 2012-Ohio-5173 (8th Dist. Cuyahoga) (special circumstances may make a party liable for receiver’s fees; not automatic)
Celebrezze v. Gibbs, 60 Ohio St.3d 69 (1991) (trial court’s discretion in receivership matters; abuse standard)
Huffman v. Hair Surgeon, Inc., 19 Ohio St.3d 83 (1985) (defining abuse of discretion; defer to trial court’s judgment)
Nahas v. George, 156 Ohio St. 52 (1951) (illegal contract admonitions under public policy)
State ex rel. Celebrezze v. Gibbs, 60 Ohio St.3d 69 (1991) (receiver powers and court discretion)