Yidi, L.L.C. v. JHB Hotel, L.L.C.
2017 Ohio 1285
| Ohio Ct. App. | 2017Background
- Yidi, L.L.C. sued JHB Hotel, L.L.C., 3M Realty, 3M Development, and Hickory Court for breach of contract and foreclosure on loans secured by three Euclid Avenue properties.
- The trial court appointed a receiver (Mark Dottore) and approved marketing and sealed-bid procedures for a receivership sale.
- The receiver selected Alto Partners’ $9.1 million offer as the highest and best after vetting Alto’s financing, experience, and a $450,000 nonrefundable commitment.
- One day before the sale-approval hearing, appellants filed an untimely competing $9.5 million offer through SRI (equity investor/owner); that offer was not submitted under the established sealed-bid procedures and lacked demonstrated financing.
- The trial court approved the receiver’s sale to Alto and gave appellants three days to exercise their equity of redemption; appellants appealed, arguing (1) the three-day redemption period was unreasonable and (2) the receiver improperly failed to accept or fully vet appellants’ higher offer.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether three days was a "reasonable time" to exercise equity of redemption under R.C. 2735.04(D)(7) | Three days is lawful and satisfied the statute; appellants had long notice of the receivership and sale process | Three days was not reasonable because Alto had 90 days to close and could pay in installments; appellants should have same redemption schedule | Court: Three days satisfied R.C. 2735.04(D)(7); receivership sales are excepted from R.C. 2329.33, redemption must be in full and not by installments; no abuse of discretion |
| Whether the receiver abused discretion by refusing to accept or fully vet appellants’ higher $9.5M offer | Sale to Alto was proper; bidding procedures granted receiver discretion to accept/reject; appellants waived objections by not challenging procedures earlier | Receiver failed to vet a higher, better offer and should have given it equal consideration | Court: Receiver acted within the court‑approved bidding procedures and reasonably declined to fully vet an untimely, noncompliant offer lacking financing evidence; no abuse of discretion |
Key Cases Cited
- Blakemore v. Blakemore, 5 Ohio St.3d 217 (Ohio 1983) (standard for abuse of discretion)
- Hausman v. Dayton, 73 Ohio St.3d 671 (Ohio 1995) (equitable right of redemption is cut off by foreclosure decree)
- Motel 4 BAPS, Inc. v. Huntington Natl. Bank, 191 Ohio App.3d 90 (Ohio Ct. App.) (receiver duties and sale approval standards)