First Union-Lehman Bros.-Bank of Am. Commercial Mtge. Trust v. Pillar Real Estate Advisors, Inc.
2014 Ohio 1105
Ohio Ct. App.2014Background
- First Union sued K. Dean Wertz, Pillar Real Estate Advisors, Inc., and Health, LLC alleging Wertz owed $432,557.47 and had fraudulently transferred assets to Pillar and Health; it sought equitable relief via a creditor’s bill under R.C. 2333.01.
- A Suggestion of Death for Wertz was filed March 9, 2011; an estate was opened in Hamilton County in November 2011.
- First Union moved to substitute Wertz’s estate as a defendant under Civ.R. 25(A) on May 4, 2012 — more than 90 days after the suggestion of death — and claimed excusable neglect because prior counsel told it no estate would be opened and assets were minimal.
- Defendants Pillar and Health moved for summary judgment, arguing the creditor’s bill failed because First Union had not obtained a lien against them and had not presented its claim to the estate fiduciary.
- The trial court denied the substitution motion as untimely and for lack of excusable neglect (noting First Union could have forced opening of an estate), and granted summary judgment to Pillar and Health on the creditor’s bill claim. Remaining claims (fraudulent transfer, alter ego) were not resolved; judgment against Pillar was entered by agreed order without prejudice to appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether substitution of decedent's estate under Civ.R. 25(A) was timely or should be allowed for excusable neglect | First Union: delay excused because prior counsel said no estate would be opened and assets minimal | Defendants: motion filed after Civ.R. 25(A) 90-day window; no excusable neglect shown; plaintiff could have forced estate opening | Court: Denied substitution; delay (~14 months) not excusable neglect; dismissal of Wertz proper |
| Whether creditor’s bill created an equitable lien preserved by R.C. 2117.10 so presentment to estate not required | First Union: creditor’s bill filed creates a lien from filing date preserved by R.C. 2117.10 (no presentment required) | Defendants: creditor’s bill is equitable; R.C. 2117.10 preserves only certain statutory/public-record liens, not equitable liens; presentment required | Court: R.C. 2117.10 does not apply to equitable liens; creditor’s bill claim failed for lack of timely presentation/substitution; summary judgment for defendants |
Key Cases Cited
- Wrinkle v. Trabert, 174 Ohio St. 233 (creditor must procure appointment of administrator to press claim when no administrator has been appointed)
- Kuhnle v. Rusmisel, 113 Ohio App. 389 (exception for liens in R.C. 2117.10 does not extend to equitable liens)
- Gaib v. Gaib, 14 Ohio App.3d 97 (creditor's bill is an equitable action to reach debtor's equitable assets)
- Pioneer Inv. Servs. Co. v. Brunswick Assoc. Ltd. Partnership, 507 U.S. 380 (factors for excusable neglect analysis)
- Markan v. Sawchyn, 36 Ohio App.3d 136 (application of Civ.R. 6(B) excusable-neglect standard to Civ.R. 25(A))