Bear v. BearBear v. Bear
- Reporters:
- ,
- Before:
- Hensal Judge.
HENSAL, Judge.
{¶1} Appellant, Sharon L. Bear, appeals the judgment of the Summit County Court of Common Pleas. For the following reasons, this Court affirms in part and reverses in part.
I.
{¶2} Ms. Bear and her brother, Byron Randall Bear (“Randall“), are the surviving children of Byron W. Bear and Dicie E. Bear. Byron and Dicie executed a joint revocable trust agreement in 1991. Byron predeceased Dicie. In 1999, Dicie executed an addendum to the trust agreement that: (1) named both Sharon аnd Randall equal beneficiaries; (2) designated money that Dicie gave Sharon to purchase property as an advancement of her trust share; and (3) changed the trustee designation from Sharon and Randall as co-trustees to Randall as the sole trustee and Sharon as an alternate trustee. Dicie died in 2000, after which a protracted legal battle ensued between Sharon and Randall.
{¶4} In 2007, Sharon filed a separate complaint against Randall in the court of common pleas general division seeking to: (1) partition and quiet title to various parcels of real estate that were previously owned by their parents but were not included in the trust; (2) to compel distribution of a parcel of real estate that was a trust asset; and (3) for an accounting of all trust assets. Sharon and Randall resolved the 2007 lawsuit with an agreed entry that appointed a receiver over the properties and a Nuveen investment account that was a trust asset. The parties moved to reopen the 2007 case after they discovered that the receiver failed to distribute the Nuveen account. Sharon attempted to appeal an order issued in that case which awarded Randall reimbursement of fees and expenses from the proceeds of the account. This Court granted Randall‘s motion to dismiss the appeal on the basis that the appeal was moot after the Nuveen account was liquidated and distributed to the parties. The Supreme Court declined to accept Sharon‘s appeal of our order. Bear v. Bear, S.Ct. Case No. 2012-2045, 3/13/2013 case announcements, 2013-Ohio-902.
{¶5} In 2009, Sharon filed another complaint against Randall, which also named various financial institutions as co-defendants. She alleged that Randall “secretly, fraudulently,
{¶6} Sharon re-filed the same lawsuit against Randall, National City Bank nka PNC Bank, Morgan Stanley and American Funds in 2011. Sharon‘s 2009 complaint named Nuveen Investments as a defendant, but her 2011 refiled complaint did not name it as a defendant. PNC Bank was grаnted summary judgment while the trial court dismissed American Funds after Sharon failed to file a more definite statement of her claims against it. Morgan Stanley filed an answer denying the allegations and asserted a cross-claim against Randall. It filed a motion for summary judgment, inter alia, on the basis that Sharon‘s negligence claim was barred by the statute of limitations. Approximately three weeks after Morgan Stanley filed its motion for summary judgment, Sharon moved to amend her complaint to assert a fraud claim against the defendant financial institutions. The trial court denied the motion and granted Morgan Stanley‘s motion fоr summary judgment.
{¶7} Randall filed a motion to dismiss, or in the alternative, motion for summary judgment. The court then granted Randall‘s motion to dismiss. Sharon appeals from the following: the order that denied her motion to amend her complaint; the order that granted summary judgment to Morgan Stanley; and the order that granted Randall‘s motion to dismiss. She filed a timely appeal, and raises three assignments of error for this Court‘s review.
ASSIGNMENT OF ERROR I
THE TRIAL JUDGE ABUSED HIS DISCRETION BY REFUSING TO GRANT PLAINTIFF-APPELLANT LEAVE TO AMEND HER COMPLAINT[.]
{¶8} Sharon argues in her first assignment of error that the trial court abused its discretion when it denied her motion to amend her complaint to assert a fraud claim. We do not agree.
{¶9} A trial court‘s decision оn a motion for leave to amend a pleading is reviewed for an abuse of discretion. Jacobson-Kirsch v. Kaforey, 9th Dist. Summit No. 26708, 2013-Ohio-5114, ¶ 12, citing Wilmington Steel Products, Inc. v. Cleveland Elec. Illuminating Co., 60 Ohio St.3d 120, 122 (1991). An abuse of discretion “implies that the court‘s attitude is unreasonable, arbitrary, or unconscionable.” Blakemore v. Blakemore, 5 Ohio St.3d 217, 219 (1983). This court may not substitute its judgment for that of the trial court when applying the abuse of discretion standard. Pons v. Ohio State Med. Bd., 66 Ohio St.3d 619, 621 (1993).
{¶10} Under the version of Civil Rule 15(A) in effect at the time that Sharon filed her motion for leave to amend her complaint, “[a] party may amend his pleading once as a matter of course at any time before a responsive pleading is served * * *. Otherwise a party may amend his pleading only by leave of court or by written consent of the adverse party. Leave of court shall be freely given when justice so requires.” “Because Civ.R. 15(A) expresses a preference for liberality with respect to amendments, ‘a motion for leave to amend should be granted absent a finding of bad faith, undue delay or undue prejudice to the opposing party.‘” Jacobson-Kirsch at ¶ 12, quoting Hoover v. Sumlin, 12 Ohio St.3d 1, 6 (1984). A plaintiff‘s attempt to amend her complaint after the filing of a motion for summary judgment, however, “raises the spectre of prejudice.” Brown v. FirstEnergy Corp., 159 Ohio App.3d 696, 2005-Ohio-712, ¶ 6 (9th Dist.),
{¶11} Sharon moved to amend her complаint after Morgan Stanley moved for summary judgment. Her motion gives no reason for her initial failure to plead fraud and it is unclear whether she sought to plead fraud against Morgan Stanley alone or all the named banks. Morgan Stanley opposed Sharon‘s motion to amend and argued that her request was brought in bad faith and with undue delay because: (1) it had filed the same summary judgment motion on the same grounds in the 2009 case; (2) she failed to attach a proposed amended complaint to her motion; (3) her motion failed to include enough allegations to establish that her claim could be pleaded with particularity as required by
{¶12} To the extent that the trial court considered factors other than bad faith, undue delay or undue prejudice when it denied Sharon‘s motion to amend, it erred. See Jacobson-Kirsch, 2013-Ohio-5114, at ¶ 12, citing Wilmington Steel Products, 60 Ohio St.3d 120, at 122. The court‘s judgment, however, reveals that it did consider whether Sharon‘s request was attributable to undue delay when it denied her motion. Further, undue prejudice is suggested by virtue of the fact that she waited until after Morgan Stanley filed its summary judgment motion, which was on essentially the same grounds it had moved in the previous action, to request leave
ASSIGNMENT OF ERROR II
THE TRIAL JUDGE ERRED, AS A MATTER OF LAW, BY GRANTING SUMMARY JUDGMENT IN FAVOR OF DEFENDANT-APPELLEE, MORGAN STANLEY, ON THE BASIS OF THE STATUTE OF LIMITATIONS DEFENSE[.]
{¶13} In her secоnd assignment of error, Sharon argues that the trial court erred when it granted summary judgment to Morgan Stanley by utilizing the wrong subsection of the statute of limitations statute and by failing to apply a discovery rule. We disagree.
{¶14} An appellate court reviews an award of summary judgment de novo. Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 105 (1996). “We apply the same standard as the trial court, viewing the facts in the case in the light most favorable to the non-moving party and resolving any doubt in favor of the non-moving party.” Garner v. Robart, 9th Dist. Summit No. 25427, 2011–Ohio–1519, ¶ 8. Pursuant to
(1) No genuine issue as to any material fact remains to be litigated; (2) the moving party is entitled to judgment as a matter of law; and (3) it appears from thе evidence that reasonable minds can come to but one conclusion, and viewing such evidence most strongly in favor of the party against whom the motion for summary judgment is made, that conclusion is adverse to that party.
Temple v. Wean United, Inc., 50 Ohio St.2d 317, 327 (1977). The movant must specifically identify the portions of the record that demonstrate an absence of a genuine issue of material fact. Dresher v. Burt, 75 Ohio St.3d 280, 293 (1996). If the movant satisfies this initial burden, the nonmoving party has a reciprocal burden to point to specific facts that show a genuine issue of material fact for trial. Id. The nonmoving party must identify some evidence that establishes a genuine issue of material fact, and may not rely upon the allegations and denials in the pleadings. Sheperd v. Akron, 9th Dist. Summit No. 26266, 2012–Ohio–4695, ¶ 10.
{¶15} Morgan Stanley argued in its motion for summary judgment that Sharon‘s negligence claim was barred by the four-year statute of limitations found in Revised Code Section 2305.09.
Except as provided for in division (C) of this section, an action for any of the following causes shall be brought within four years after the cause thereof accrued:
* * *
(B) For the recovery of personal property, or for taking or detaining it;
* * *
(D) For an injury to the rights of the plaintiff not arising on contract nor enumerated in sections 1304.35, 2305.10 to 2305.12, and 2305.14 of the Rеvised Code;
* * *
If the action is for * * * the wrongful taking of personal property, the cause[ ] thereof shall not accrue until the wrongdoer is discovered * * *.
{¶16} The parties disagree whether the discovery rule found in the last sentence of
{¶17} Shаron opposed Morgan Stanley‘s motion with her own affidavits in which she averred that she was not aware of Randall‘s purported fraudulent activity until the spring of 2009. According to her, Randall withheld financial information that pertained to the trust from her despite her repeated requests for such information. Sharon averred that it was not until “recently” when she learned from a Morgan Stanley representative that Randall had withdrawn money over an extended period of time without informing her, as co-trustee, of his actions. Further, she maintained that she suffered a serious head injury and “mental instability” in 2004 that impedеd her ability to obtain information from the banks. Sharon presented no evidence, however, that she was adjudged mentally incompetent by any court. She argues on appeal that her claim against Morgan Stanley falls under
{¶19} Sharon‘s claims against Morgan Stanley are clearly grounded in negligence rather than conversion or fraud. General tort claims, including those for negligence, are governed by the four-year statute of limitations found in Revised Code Section 2305.09(D). Investors REIT One v. Jacobs, 46 Ohio St.3d 176, 179 (1989). “The general rule is that a cause of action exists from the time the wrongful act is committed.” Flagstar Bank, F.S.B. v. Airline Union‘s Mtge. Co., 128 Ohio St.3d 529, 2011-Ohio-1961, ¶ 13. At the very latest, the statute of limitations began to run on Sharon‘s claim against Morgan Stanley in February of 2004 when Randall
ASSIGNMENT OF ERROR III
THE TRIAL JUDGE ERRED, AS A MATTER OF LAW, BY DISMISSING THE COMPLAINT AGAINST DEFENDANT-APPELLEE, BYRON RANDALL BEAR, FOR FAILURE TO ALLEGE A POTENTIALLY MERITORIOUS CLAIM FOR RELIEF.
{¶20} Sharon argues in her third assignment of error that the trial court erred when it dismissed her claims against Randall. This Court agrees.
{¶21} Randall‘s motion to dismiss was filed under
In order for a trial court to dismiss a complaint under
Civ.R. 12(B)(6) for failure to state a claim upon which relief can be granted, it must appear beyond doubt that the plaintiff can prove no set of facts in support of the claim that would entitle the plaintiff to the relief sought. The allegations of the complaint must be taken as true, and those allegations and any reasonable inferences drawn from thеm must be construed in the nonmoving party‘s favor.
Id., citing McKinley at ¶ 12.
{¶22} Randall‘s motion to dismiss was alternatively a motion for summary judgment. He premised his motion on his arguments that Sharon‘s claims against him were barred by the statute of limitations, res judicata, waiver and estoppel. Instead of granting the motion on one of the grounds advanced by Randall in his motion, the trial court granted his motion to dismiss on
{¶23} Fraud consists of several elements:
(1) a representation (or concealment of a fact when there is a duty to disclose) (2) that is material to the transaction at hand, (3) made falsely, with knowledge of its falsity or with such utter disregard and recklessness as to whether it is true or false that knowledge may be inferred, and (4) with intent to mislead another into relying upon it, (5) justifiable reliance, and (6) resulting injury proximately caused by the reliance.
Volbers-Klarich v. Middletown Mgt., Inc., 125 Ohio St.3d 494, 2010-Ohio-2057, ¶ 27.
{¶24} Sharon maintains that she pleaded her fraud claims against Randall with the particularity required by
During the time period beginning in 2001 and continuing up through 2007, * * * Randall * * * secretly, fraudulеntly, and covertly conducted a campaign to illegally siphon funds from the Dicie E. Bear Estate and Trust. Specifically, * * * Randall * * * contacted the financial institution defendants and purported to be the sole [t]rustee, [b]eneficiary, or [f]iduciary of the Dicie E. Bear Estate and Trust and would convince the financial institution defendants that he was to have sole authority over the disbursement of funds and that these financial institution defendants should avoid or ignore the Co-Executrix, Sharon L. Bear.
This Court concludes that the allegations in the complaint met all the pleading requirements of
{¶25} Construing all allegations and reasonable inferences in the complaint in favor of Sharon, this Court will not conclude, in the first instance, that she can prove no set of facts that would entitle her to relief so as to warrant dismissal of her claims under
III.
{¶26} Sharon‘s first and second assignments of error are overruled. Her third assignment of error is sustained. The judgment of the Summit County Court of Common Pleas is affirmed in part, reversed in part, and the cause is remanded for further proceedings.
Judgment affirmed in part,
reversed in part,
and cause remanded.
There were reasonable grounds for this appeal.
We order that a special mandate issue out of this Court, directing the Court of Common Pleas, County of Summit, State of Ohio, to carry this judgment into execution. A certified copy of this journal entry shall constitute the mandate, pursuant to
Immediately upon the filing hereof, this document shall constitute the journal entry of judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the period for review shall begin to run.
JENNIFER HENSAL
FOR THE COURT
BELFANCE, P. J.
CONCURRING IN PART, AND DISSENTING IN PART.
{¶27} I respectfully dissent with respect to the main opinion‘s resolution of Ms. Bear‘s first assignment of error. I would conclude that the trial court abused its discretion in denying Ms. Bear‘s motion to amend because the trial court did so based on evidence not in the record before it. Because of that, I would conclude that it was premature to grant summary judgment to Morgan Stanley given that the proposed amendment appeared likely to impact the allegations against Morgan Stanley. I concur with respect to the main opinion‘s resolution of the third assignment of error.
{¶28} Civil Rule 15(A) contains the express requirement that “[t]he court shall freely give leave [to amend] when justice so requires.” This makes sense given that pleadings at the outset of the litigation are merely required to contain short, plain statements setting forth the claimed entitlement to relief and, as discovery ensues, facts may come to light that dramatically change the landscape of both the claims and the defenses. Thus, the rule of liberality is tempered where there is demonstration of bad faith, undue delay, or undue prejudice. Turner v. Cent. Local School Dist., 85 Ohio St.3d 95, 99 (1999) (“While the [civil] rule allows for liberal amendment, motions to amend pleadings pursuant to
{¶29} In addition, I disagree that undue prejudice was demonstrated given the record before us. This Court has concluded in the past that “an attempt to amend a complaint following the filing of a motion for summary judgment raises the spectre of prejudice.” (Internal quotations and сitation omitted.) Pintagro at ¶ 22. Additionally, it is true that the Supreme Court of Ohio has held that, “[w]here a plaintiff fails to make a prima facie showing of support for new matters sought to be pleaded, a trial court acts within its discretion to deny a motion to amend the pleading.” (Emphasis omitted.) Wilmington Steel Prods., Inc. v. Cleveland Elect. Illuminating Co., 60 Ohio St.3d 120 (1991), syllabus. However, the Supreme Court later clarified that holding in the case of Darby v. A-Best Prods. Co., 102 Ohio St.3d 410, 2004-Ohio-3720. There the Supreme Court stated that,
[i]n considering a plaintiff‘s request for leave to amend, a trial court‘s primary consideration is whether there is actual prejudice to the defendants because of the
delay. Although we havе held in a case involving the assertion of a new claim against an existing defendant that the plaintiff must make at least a prima facie showing [of] support for the new matters sought to be pleaded that consideration is meant to aid in determining whether the amendment is simply a delaying tactic, [or] one which would cause prejudice to the defendant.
(Internal quotations and citations omitted.) Id. at ¶ 20. See also Mitchell v. Lemmie, 2d Dist. Montgomery No. 21511, 2007-Ohio-5757, ¶ 80-81.
{¶30} In the instant matter, in their briefs in opposition to Ms. Bear‘s motion to amend, PNC and Morgan Stanley base their claim of undue delay and bad faith on the fact that this case was a refiled case and based upon assertions about the history of thе 2009 litigation. They rely on their recitation of the procedural history of the 2009 litigation to demonstrate that Ms. Bear should have been aware of the fraud claim and Morgan Stanley‘s statute of limitations argument years ago, as Morgan Stanley filed the same summary judgment motion in the 2009 case. The problem with that argument is that the only item in the record from the 2009 litigation appears to be the 2009 complaint. Neither Morgan Stanley nor PNC filed documents from the 2009 litigation evidencing its procedural history. Thus, we have no record of how the 2009 litigation proceeded. Moreover, the trial court was not pеrmitted to take judicial notice of the record of the 2009 case. See In re J.C., 186 Ohio App.3d 243, 2010-Ohio-637, ¶ 14 (9th Dist.) (“A trial court may only take judicial notice of prior proceedings in the immediate case.“) (Internal quotations and citation omitted.). Accordingly, there was no evidence to support their argument concerning undue delay. Despite this, it appears from the judgment entry that the trial court relied on these facts not in evidence in concluding that the motion to amend should be denied.
{¶31} This was not a case that was pending for years prior to the plaintiff seeking to amend the complaint. At the point in time that Ms. Bear filed her motion to amend, Mr. Bear had not even been served with the complaint, and Morgan Stanley‘s motion for summary
CARR, J.
CONCURRING IN PART, AND DISSENTING IN PART.
{¶32} I concur in the majority‘s resolution of the first and second assignments of error. The issue before this Court is whether or not the trial court can dispose of a claim on the basis of grounds not raised in the motion to dismiss. In that regard, I disagree with the majority‘s resolution of the third assignment of error, specifically the conclusion that Ms. Bear‘s fraud claim can withstand a motion to dismiss for failure to state a claim upon which relief can be granted and that this matter must be remanded to the trial court for consideration of the grounds raised in Mr. Bear‘s motion to dismiss in the first instance.
{¶33} The Ohio Supreme Court has recognized that “[t]he Rules of Civil Procedure neither expressly permit nor forbid courts to sua sponte dismiss complaints.” State ex rel. Edwards v. Toledo City Schoоl Dist. Bd. of Edn., 72 Ohio St.3d 106, 108 (1995). Even so, “[g]enerally, a court may dismiss a complaint on its own motion pursuant to
{¶34} The trial court dismissed Ms. Bear‘s fraud claim after discussing the requirements of
{¶35} As this Court has recognized:
The Ohio Supreme Court has held that a party cannot maintain an action for fraud when the fraudulent representations were not made to him to induce him to act upon them in any manner affecting his own interests. See Wells v. Cook, 16 Ohio St. 67 (1865), syllabus. Accordingly, a plaintiff claiming that a third party relied on a misrepresentation made by the defendant and that the plaintiff suffered injury thereby does not state a valid cause of action for fraud. See Russell v. Northwood, 6th Dist. Wood No. WD-97-050, 1998 WL 102137, *4 (Feb. 27, 1998).
{¶36} In this case, Ms. Bear alleged in her fraud claim that her brother falsely represented to the financial institutions managing their deceased parents’ estate and trust that he had sole authority over the disbursement of those funds. She further alleged that the financial institutions relied on her brother‘s fraudulent misrepresentations and erroneously disbursed funds