2023 Ohio 2019
Ohio Ct. App.2023Background:
- McOmber and Wesley formed and operated a cattle business (L & M Ag, LLC); many loans for the operation were signed solely in Michael McOmber’s name.
- After the cattle operation failed, McOmber (via McOmber Land, LLC) alleged significant debts remained; in 2017 Wesley and Brooke signed a $499,822.21 promissory note to McOmber Land and a contemporaneous Memorandum of Understanding contemplated refinancing certain loans.
- In July 2018 McOmber sold a livestock barn, equipment, and a tractor to Bradley and Michael Liebrecht under a Purchase Agreement that included a Release Provision stating McOmber would “release any and all claim[s] associated with Wes and Brooke Liebrecht” and that McOmber would sign a separate Release of Liability at or before closing.
- McOmber later sued Wesley, Brooke, and several related LLCs alleging breach of fiduciary duty, fraud, enforcement of the promissory note, conversion, and related remedies. Wesley and Brooke moved for summary judgment, asserting the Purchase Agreement effected a global release.
- Bradley filed an affidavit saying he expected a global release and would not have bought the barn otherwise; McOmber filed an affidavit saying he intended the release to cover only claims related to the barn/equipment and not the note; the Purchase Agreement was produced in discovery eight days before the cut-off.
- The trial court granted Wesley and Brooke summary judgment, concluding the Release Provision was an unambiguous global release; the court did not address other summary-judgment arguments. The appellate court reversed and remanded, finding the Release Provision ambiguous and extrinsic evidence created a genuine issue of material fact.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Scope of the Release in the Purchase Agreement | McOmber: release limited to barn, tractor, and related equipment; did not release the promissory note or other claims | Wesley/Brooke: language “any and all claims” is a global release extinguishing all claims | Ambiguous: because the agreement contemplated a separate Release of Liability, extrinsic evidence (affidavits, proposed agreement) creates a triable issue; summary judgment for Wesley/Brooke reversed |
| Use of the Purchase Agreement despite late disclosure | McOmber: document was disclosed too late and prejudiced discovery (no depositions reopened) | Wesley/Brooke: document was produced before discovery cutoff; McOmber knew of it and took no steps to mitigate | No error: Purchase Agreement disclosed eight days before discovery cutoff; appellant failed to seek more discovery or relief; trial court properly considered it |
| Granting summary judgment for parties that did not move (L & M, Slinger, Prairie Creek) | McOmber: trial court erred entering judgment for non-moving parties and parties not signatories to the release | Defendants: (not authoritatively decided at trial because primary SJ resolved case) | Moot on appeal: because primary SJ to Wesley/Brooke was reversed, these arguments are moot and not decided here |
| McOmber Land’s motion for partial summary judgment on the promissory note | McOmber Land: sought judgment on the note (ask appellate court to enter judgment) | Wesley/Brooke: trial court found matters moot and did not rule on partial SJ | Not reached on appeal: appellate court declines to decide issues the trial court never addressed; remand for further proceedings |
Key Cases Cited
- Doe v. Shaffer, 90 Ohio St.3d 388 (standard of de novo review for summary judgment)
- Turner v. Turner, 67 Ohio St.3d 337 (materiality test for summary judgment; genuine issue standard)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (summary-judgment inquiry whether a reasonable jury could return a verdict for the nonmoving party)
- Dresher v. Burt, 75 Ohio St.3d 280 (movant’s initial burden and nonmovant’s rebuttal under Ohio Civ.R. 56)
- Sunoco, Inc. v. Toledo Edison Co., 129 Ohio St.3d 397 (contract interpretation: give effect to parties’ intent; plain meaning controls)
- Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216 (contract is unambiguous as a matter of law if it can be given a definite legal meaning)
- Lutz v. Chesapeake Appalachia, L.L.C., 148 Ohio St.3d 524 (use of extrinsic evidence when contract language is ambiguous)
- Galmish v. Cicchini, 90 Ohio St.3d 22 (parol evidence rule: integrated writings and limits on extrinsic evidence)