2020 Ohio 4617
Ohio Ct. App.2020Background
- Designers Choice sold substantially all assets to Attractive Floorings in 2012 for $355,000, evidenced by an asset purchase agreement and a promissory note (96 monthly payments of $3,697.92); Attractive’s owner Eric Moen signed a guaranty.
- In 2015 Moen suffered health problems; Lilley (Designers Choice) allegedly told him that if he returned certain equipment and cured a rental arrearage, Lilley would forgive the remaining balance. Moen complied but did not file bankruptcy and later sold another location.
- Lilley later accelerated the promissory note and sued Attractive and Moen for breach and to collect the note; Attractive and Moen counterclaimed asserting an oral modification/setoff.
- At trial Designers Choice sought ~$200,885; the jury found breach by Attractive Floorings but awarded only $50,000. The trial court entered judgment for $50,000 (no interest).
- Designers Choice moved for directed verdict/JNOV and a new trial and appealed after the trial court denied relief; this Court affirmed in part and reversed in part, remanding for interest determinations.
Issues
| Issue | Plaintiff's Argument (Designers Choice) | Defendant's Argument (Attractive) | Held |
|---|---|---|---|
| Denial of directed verdict on Attractive’s counterclaims | Evidence insufficient to support Attractive’s oral-modification, estoppel, fraud, or waiver defenses; DV should have been granted | There was evidence supporting oral modification/setoff and other defenses for the jury | Motion denial moot as jury found breach (thus no oral modification); first assignment overruled |
| Denial of JNOV / motion to reopen judgment (amount of recovery) | JNOV should award the full $200,885.28 liquidated balance | JNOV not proper to alter jury’s damages award; factual disputes exist | Court may not use Civ.R. 50(B) to challenge the size of a jury’s damages award; second assignment overruled |
| Denial of new trial for inadequate damages | $50,000 is inadequate; liquidated damages were agreed ($200,885.28) | Jury could set off returned assets and reasonably award $50,000 | Trial court did not abuse discretion; jury could offset returned assets; third assignment overruled |
| Trial court’s order denying post-judgment interest | Statutory post-judgment interest applies under R.C. 1343.03 because contract is silent on rate for amounts that become due | Promissory note said “no interest thereon,” so no interest should apply | Asset agreement/note barred interest on original payment schedule but were silent as to interest on amounts that become due or upon judgment; plaintiff entitled to post-judgment interest; fourth assignment sustained |
| Denial of prejudgment interest | Prejudgment interest under R.C. 1343.03(A) applies when contract does not specify otherwise | Agreement could have provided for interest on default but did not, so none should apply | Prejudgment interest is available absent a written contract specifying a different rate; fifth assignment sustained |
Key Cases Cited
- Ruta v. Breckenridge-Remy Co., 69 Ohio St.2d 66 (1982) (directed verdict legal-sufficiency standard)
- Hawkins v. Ivy, 50 Ohio St.2d 114 (1977) (directed verdict denial when evidence allows different conclusions)
- Goodyear Tire & Rubber Co. v. Aetna Cas. & Sur. Co., 95 Ohio St.3d 512 (2002) (reasonable-minds test for Civ.R. 50(A))
- Wagner v. Roche Laboratories, 77 Ohio St.3d 116 (1996) (court should not weigh evidence or assess credibility on directed verdict)
- Osler v. City of Lorain, 28 Ohio St.3d 345 (1986) (JNOV applies same test as directed verdict)
- Samson Sales, Inc. v. Honeywell, Inc., 12 Ohio St.3d 27 (1984) (when parties fix amount in clear unambiguous terms, amount may be treated as liquidated damages)
- Desai v. Franklin, 177 Ohio App.3d 679 (2008) (Civ.R. 50(B) challenges verdict, not the damages award amount)
- Yager Materials, Inc. v. Marietta Indus. Ents., Inc., 116 Ohio App.3d 233 (1996) (R.C. 1343.03(A) requires written contract with an express interest rate to displace statutory interest)