722 N.E.2d 185 | Ohio Ct. App. | 1999
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *285
"I. The trial court committed prejudicial error by permitting plaintiff to maintain an action based on claims of an unregistered trade name or fictitious entity over the objections and affirmative defense of defendants-appellants.
"II. The trial court committed prejudicial error by awarding contract damages based on a contract to which defendants-appellants were not party.
"III. The trial court committed prejudicial error in granting judgment for indemnification in favor of co-defendant Savastano and against all three defendants-appellants where the only cross-claim pled by Savastano was against co-defendant AL-SOL, INC., only [sic].
For the following reasons, the court finds the trial court should have dismissed appellee's claim for breach of the lease agreement because appellee lacked capacity to pursue that claim. The trial court also abused its discretion by ordering appellants AE and Solomon to indemnify Savastano. Therefore, the judgments on Frate's claim for breach of the lease agreement, the award of attorneys fees based on the lease agreement, and the judgment requiring Solomon and AE to indemnify Savastano, are reversed. The trial court's judgments on Frate's claim for conversion, and the court's judgment requiring Al-Sol to indemnify Savastano, are affirmed. *286
On the day trial was scheduled to begin, appellants moved to dismiss the amended complaint, arguing that Frate wrongfully attempted to prosecute this action under a trade name or fictitious name without having complied with the registration requirements of R.C.
A bench trial was conducted on August 14, 1997. Following the trial, on September 2, 1997, the court entered an opinion and order finding that "[t]he defendants failed to make the monthly rental payments upon being due, and were therefore in default under the lease" agreement with Frate. The court further found that Savastano and Buckner entered into the lease agreement as agents of The Edge's manager, Donald Kollecker, and Kollecker had apparent authority to act for Solomon, AE and Al-Sol; therefore, Solomon, AE and Al-Sol were bound by the lease agreement. Finally, the court found defendants had converted Frate's equipment. The court entered judgment in the amount of $19,336 against all defendants jointly and severally and granted judgment in favor of defendant Savastano on her cross-claim against defendants Solomon, AE and Al-Sol. The court also awarded Frate a reasonable attorney's fee, the amount of which was to be determined at a future hearing.
On October 24, 1997, the court awarded fees of $4,000 against Al-Sol, AE and Solomon. In addition, the court appointed a receiver to take possession of, manage, and sell these defendants non-exempt property to satisfy the judgment. This appeal was timely2 filed on November 5, 1997.3 *287
"(B) No person doing business under a trade name or fictitious name shall commence or maintain an action in the trade name or fictitious name in any court in this state or on4 account of any contracts made or transactions had in the trade name or fictitious name until it has first complied with section
R.C.
Notably, R.C.
This court has previously described the effect of R.C.
In this case, appellants specifically raised the issue of appellee's capacity to sue as the third affirmative defense in their original answer and their answer to the amended complaint; therefore, appellants preserved the issue for a court decision.
Appellee claims appellants waived the issue of appellee's capacity by failing to raise it by dispositive motion before the courts dispositive motion deadline. He asserts a contrary result would permit appellants to "sandbag" him by raising the issue on the eve of trial; however, "sandbagging" is not an issue here. Having raised plaintiff's capacity to sue in the pleadings, appellants even could have presented evidence and argument on this issue at trial. See Chehotis v. Gould (Dec. 14, 1994), Montgomery App. No. 14471, unreported; Fisco v. Chisholm (May 7, 1987), Cuyahoga App. No. 52111 52112, unreported. Therefore, the motion to dismiss was not untimely.
Appellee had ample opportunity to report his use of the name "Empirical Sound" to the Secretary of State before trial. Cf. MBARealty v. Little G, Inc. (1996),
There is a surprising dearth of authority regarding the types of claims precluded by R.C.
The plain language of R.C.
Appellee's claim for breach of the lease agreement was based on a contract made in the name of Empirical Sound. This is plainly an "action * * * on account of any contracts made * * * in the * * * fictitious name" which appellee lacked the capacity to pursue under R.C.
However, appellee's tort claim for conversion requires a different analysis. No contract or transaction is necessary to support a tort claim for conversion of personal property, so this claim is not one of the second class of precluded claims.7 Therefore, the court properly denied the motion to dismiss this claim.8
Although Savastano has not responded to appellants' brief, appellee Frate urges that appellants liability for indemnity was tried by implied consent, so the issue should be treated as if it were raised by the pleadings. Civ.R. 15 (B). *290
"An implied amendment of the pleadings under Civ.R. 15(B) will not be permitted where it results in substantial prejudice to a party. Various factors to be considered in determining whether the parties impliedly consented to litigate an issue include: whether they recognized that an unpleaded issue entered the case; whether the opposing party had a fair opportunity to address the tendered issue or would offer additional evidence if the case were to be tried on a different theory; and, whether the witnesses were subjected to extensive cross-examination on the issue." State, ex rel. Evans v.Bainbridge Twp. Trustees (1983),
In this case, appellee has not demonstrated that the parties impliedly consented to try the issue of appellants' liability for indemnity. Appellee contends implied consent can be discerned from (1) an arbitration award requiring all three appellants to indemnify Savastano and (2) two arguments by Savastano's counsel at trial demanding judgment for indemnity against "Solomon." Appellants consent cannot be implied from an arbitration award from which they appealed de novo. Nor can a party's consent be implied from the arguments of opposing counsel. Appellee has not pointed to any supporting evidence that was introduced at trial and that the parties clearly understood to be aimed at the unpleaded issue.
Accordingly, the trial court abused its discretion by requiring Solomon and AE to indemnify Savastano.
Judgment accordingly.
JOHN T. PATTON, P.J. and MICHAEL J. CORRIGAN, J. CONCUR