2005 Ohio 7078 | Ohio Ct. App. | 2005
Lead Opinion
{¶ 3} National City Bank approved the Buyers for the loan and the closing was scheduled to take place on June 30, 2001. However, prior to the closing, the bank informed the Hornungs that although it approved the loan before the closing date, the paperwork for the loan could not be signed until July 2 or 3, 2001. Despite the delay in financing, the Hornungs and the Buyers agreed to go forward with the closing on the scheduled date. After taking possession of the property, the Buyers failed to sign the financing agreement and subsequently abandoned the property and their obligations under the purchase agreement, claiming that the purpose of the transaction had become frustrated.
{¶ 4} Subsequently, the Hornungs brought suit against the Buyers, for breach of contract, and Appellees, for breach of fiduciary duty and negligence. Appellees then moved for summary judgment and the trial court granted their motion.
{¶ 6} "The trial court erred by granting summary judgment in favor of Eranco Business Brokers, Frances Ollila, and Ronald Polinsky."
{¶ 7} When ruling on a motion for summary judgment, the court must construe the record and all inferences therefrom in the opposing party's favor. Doe v. First United Methodist Church,
{¶ 8} An appellate court reviews a decision granting summary judgment on a de novo basis. Grafton v. Ohio Edison Co.,
{¶ 10} In this case, Appellees owed a fiduciary duty to the Hornungs since they were real estate brokers, as that phrase is defined by R.C.
{¶ 11} In this case, the Hornungs hired Appellees to procure buyers to purchase the Hornungs' business and the Hornungs and the Buyers executed a purchase agreement pursuant to Appellees' efforts. As part of the purchase agreement, the Buyers signed a lease agreement for a term of 3½ years. Furthermore, paragraph one of the purchase agreement states that the agreement is for the purchase and sale of, among other things, the lease. These facts establish that Appellees were acting as real estate agents as defined by R.C.
{¶ 12} Real estate agents owe their clients fiduciary duties. "In representing any client in an agency or subagency relationship, the [real estate broker] shall be a fiduciary of the client and shall use [their] best efforts to further the interest of the client." R.C.
{¶ 13} In this case, the Hornungs have failed to produce any evidence that would show that Appellees breached their fiduciary duties toward the Hornungs. The Hornungs alleged that Appellees breached their fiduciary duty by negligently misrepresenting the nature of the dry closing, and that as a result of that breach, the Hornungs' deal with the Buyers failed. Appellees produced evidence showing that this did not happen. First, Appellees point to the listing agreement which states that it agreed to procure a ready, willing, and able purchaser. Second, Appellees produced Ollila's affidavit, where she stated that she fully disclosed all information to and acted in good faith towards the Hornungs as required by law.
{¶ 14} In response, the only evidence in the record which the Hornungs could rely upon to create a genuine issue of material fact is a response from the Buyers to an interrogatory which stated that Ollila told them that the paperwork was part of a dry closing in furtherance of the SBA loan application and contingent upon transfer of a turn key operation. Appellees deny that they ever told the Buyers that there were any contingencies.
{¶ 15} While these statements appear to conflict, they do not create a genuine issue of material fact. The Buyers' statement indicates that Olilla informed them that the sale was contingent, but is silent on whether Ollila informed the Hornungs of this fact; the record is silent on whether the sale was for a "turn key operation" since that phrase is somewhat ambiguous; and Ollila averred that she told the Hornungs all relevant information. Without evidence that Ollila negligently misrepresented something, the Hornungs cannot prove a necessary element of their claim. Accordingly, the trial court properly granted summary judgment to Appellees. The Hornungs' sole assignment of error is meritless and the judgment of the trial court is affirmed.
Donofrio, P.J., concurs.
Vukovich, J., concurs. See concurring opinion.
Concurrence Opinion
{¶ 16} I concur in the decision and analysis reached by my colleagues. However, I write separately to address the reasoning the trial court relied on when granting summary judgment for appellees.
{¶ 17} The trial court in granting summary judgment stated, "Defendant's, Eranco Business Brokers Frances Ollila and Ronald Polinsky, motion for summary judgment against both Plaintiff and Defendant, Teana L. Fletcher, in the above captioned case is hereby granted as Eranco's waiver was validly executed and precludes the instant claims against them by all parties to this suit." 12/13/04 J.E.
{¶ 18} In my opinion this was not a proper reason for granting summary judgment. The liability release in question did not express Eranco's intent in clear and unequivocal terms.
{¶ 19} The liability release in question stated the following: "The parties jointly and severally hereby expressly release and waive any and all claims, demands, and causes of action against Eranco, Inc., dba Eranco Business Brokers and against Eranco Associates Real Estate and its agents arising out of the sale of the business purchased herein."
{¶ 20} Eranco had both parties sign this release form.
{¶ 21} The Ohio Supreme Court has held "indemnity agreements purporting to release a party from the consequences of his negligence and failing to express that intent in `clear and unequivocal' terms to be unenforceable." Bowman v. Davis
(1976),
{¶ 22} In Bowman, the Ohio Supreme Court was considering a case involving a hospital consent form. It was the observation of the Supreme Court that, although the consent form was not an indemnity agreement, it appeared to have been designed to release the hospital and attending physicians from the consequences of their negligence. The form however, did not specifically mention release from liability for negligence. The Ohio Supreme Court set the agreement aside because the intent of the indemnitee was not set out in "clear and unequivocal" terms. Id. at 44.
{¶ 23} In the matter at hand, the release is similar to the one in Bowman in that the release appears to have been designed to release Eranco from liability for the consequences of their actions. Also similar to Bowman, is the fact that the form does not specifically mention release from liability for negligence.
{¶ 24} Thus, the release was not valid. While, Eranco argues two things to suggest that it is valid, I find these arguments unpersuasive.
{¶ 25} First, Eranco argues that the Hornungs may not raise the issue of intent on appeal when they did not raise it in the trial court. However, this is an incorrect assertion. Eranco raised the issue of liability release as an affirmative defense. In Hornungs' response to the motion for summary judgment, the Hornungs responded to this defense by raising the issues of clear and unequivocal terms, and intent. Thus, the issue is properly before the court on appeal.
{¶ 26} The next argument of Eranco is based upon Glaspell v.Ohio Edison Co. (1987),
{¶ 27} Here, Eranco's release form is intended to release them from liability for negligence, but not specifically state that intention. Unlike the parties in Glaspell, nothing in the record here suggests that the parties are large commercial enterprises or that they are sophisticated in the matters of contract. In fact, the record suggests the exact opposite. The Hornungs appear to be individuals attempting to sell their small company. Likewise, Eranco appears to be a small real estate/business brokerage consisting of only a few partners. Furthermore, it is not clear form the record that the parties understood the liability issues surrounding the release document.
{¶ 28} As such, I would find that the release was not valid. However, this fact does not necessitate a reversal of the judgment of the trial court as there are alternative grounds to support said judgment as heretofore set forth in the opinion to this Court.
{¶ 29} Even considering all the above, I agree with my colleagues that summary judgment is appropriate for the reasons expressed in that opinion. An appellate court's review of the grant or denial of summary judgment is not confined to the trial court's reasons for granting or denying the motion. A trial court's judgment must be affirmed if any valid grounds are found on review to support it. Joyce v. General Motors Corp. (1990),
{¶ 30} Consequently, while I believe that the trial court's reason to grant summary judgment for appellees is incorrect, I agree with the majority that summary judgment was appropriately granted for appellees for the reasons expressed in the majority opinion.