2013 Ohio 1014
Ohio Ct. App.2013Background
- Filo, a subcontractor, provided materials and services on a commercial project at 789 Wick Ave under contract with the general contractor D&R Construction; Liberato is the project owner.
- Filo claims Liberato promised full payment of about $33,600; he received $7,000 and was not paid the remaining balance.
- Filo filed suit in March 2010 asserting promissory estoppel, unjust enrichment, conversion, and fraud; trial court dismissed some claims under Civ.R. 12(B)(6).
- The trial court dismissed promissory estoppel, unjust enrichment, and fraud but retained a conversion claim; the court relied on the statute of frauds (R.C. 1335.05) and the Prompt Payment Act (R.C. 4113.61).
- On appeal, the Seventh District reversed in part: promissory estoppel, unjust enrichment, and fraud claims survived the Civ.R. 12(B)(6) dismissal; conversion claim affirmed; remanded for further proceedings.
- The court construed leading object and statute-of-frauds issues with emphasis on the pleading stage and future fact development.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether promissory estoppel survives the statute of frauds | Filo contends the leading-object rule prevents the statute of frauds from baring promissory estoppel. | Liberato argues promises to pay the debt of another are barred unless written; leading-object rule applies only if the promisor’s own interest is not involved. | Promissory estoppel claim survives; not barred by the statute of frauds at the pleading stage. |
| Whether the leading object rule overruns the statute of frauds to enforce an oral pay-commitment | Leading object supports enforcement where promisor seeks to benefit himself. | Leading object is not satisfied here; writing required unless promisor’s own pecuniary interest is shown. | Leading object may sustain enforcement; issue retained for later fact-finding. |
| Whether fraud claim survives under leading-object analysis and pleading standards | Amended complaint pleads fraud with particularity and shows promisor’s self-benefit. | Lack of or improper reliance and leading-object defense bars fraud claims. | Fraud claim survives as to justifiable reliance and pleading; remanded for fact-finding. |
| Whether unjust enrichment and promissory estoppel claims are barred by the Prompt Payment Act | Prompt Payment Act does not bar common-law claims when owner promises payment. | Act precludes certain non-contractual or conversion claims against owner. | Unjust enrichment and promissory estoppel claims are not barred; reversal of related dismissal. |
Key Cases Cited
- Olympic Holding Co., L.L.C. v. ACE Ltd., 122 Ohio St.3d 89 (Ohio 2009) (promissory estoppel provides damages where contract elements are unmet)
- Wilson Floors v. Sciota Park, Ltd., 54 Ohio St.2d 451 (Ohio 1978) (leading object rule enforces oral promises to promisor's own pecuniary interest)
- America’s Floor Source, L.L.C. v. Joshua Homes, 191 Ohio App.3d 493 (Ohio App.3d 2010) (owner-promisor personal payment promise not barred by statute of frauds when best interests are served)
- Zacchini v. Scripps-Howard Broadcasting Co., 47 Ohio St.2d 224 (Ohio 1976) (fraud elements require particularity and can support damages)