2022 Ohio 1754
Ohio Ct. App.2022Background
- Jason and Crystal Jardine were married and jointly owned several funeral‑industry businesses (each held a 50% interest).
- Jason filed for divorce in December 2020; litigation was contentious with extensive discovery disputes and mutual restraining orders.
- Crystal moved to appoint a receiver over six business entities, alleging unexplained cash withdrawals, transfers, and reallocation of business funds that threatened marital assets.
- The trial court ordered supplemental briefing, found evidence (including affidavits and cancelled checks) suggesting dissipation and inability of the parties to cooperate, and appointed a receiver to marshal assets, review records, perform an accounting, and evaluate management.
- The receiver was authorized to be compensated from the businesses’ assets; Jason appealed, arguing lack of clear and convincing evidence, improper scope/costs of the receivership, and need for a hearing.
Issues
| Issue | Plaintiff's Argument (Jardine) | Defendant's Argument (Jardine) | Held |
|---|---|---|---|
| Whether the trial court abused its discretion in appointing a receiver over the marital businesses | Insufficient clear and convincing evidence; much of Crystal’s proof was self‑created or based on "information and belief"; denials and affidavits show competing evidence | Alleged dissipation/unexplained withdrawals, transfers to separate accounts, and breakdown in ability to jointly operate businesses justified appointment to preserve assets | Affirmed. Court had evidence tending to prove facts essential to sustain appointment and did not abuse discretion |
| Whether the court erred in authorizing receiver compensation and related costs | Receiver fees will harm business viability; court failed to meaningfully limit fees | Receiver entitled to reasonable compensation; costs may be taxed or paid from receivership corpus and court may control scope and reasonableness | Affirmed. Court can limit receiver powers and fees; compensation may be reasonable administrative expense and payable from assets |
| Whether an evidentiary hearing was required before appointing a receiver | Competing affidavits created factual dispute requiring a hearing | No hearing required where affidavits, filings, and surrounding circumstances provide sufficient basis | Affirmed. Hearing not required; trial court may act on submitted evidence and circumstances |
Key Cases Cited
- Equity Ctrs. Dev. Co. v. S. Coast Ctrs., Inc., 83 Ohio App.3d 643 (8th Dist. 1992) (appointment of a receiver is an extraordinary equitable remedy that requires clear and convincing evidence)
- Malloy v. Malloy Color Lab, Inc., 63 Ohio App.3d 434 (10th Dist. 1989) (party seeking receivership must show necessity to preserve rights; appellate review limited to whether evidence tended to prove essential facts)
- State ex rel. Celebrezze v. Gibbs, 60 Ohio St.3d 69 (1991) (trial court has broad discretion to consider surrounding facts and circumstances when appointing a receiver)
- Lockard v. Lockard, 175 Ohio App.3d 245, 886 N.E.2d 276 (4th Dist. 2008) (receivership may be appropriate in divorce where dissipation alleged, but scope must be limited to preserve separate property)
