*1 сannot demonstrate that the outcome of her would have different if her been objected trial counsel additional posed questions Clausing had to her being jury. on the demonstrating prejudice, appellant’s Without an actual error or claim of
ineffective of counsel Accordingly, appellant’s assistance fails. we overrule fourth assignment of error.
Judgment affirmed. Harsha, P.J., Kline, J., concur.
MORAN, Appellee, v. DIVERSIFIED, INC., Everdry Waterproofing, Appellant.
RIVERFRONT
d.b.a.
Inc.,
as
Diversified,
[Cite Moran v.
App.3d
Ohio
No. 24545.
Decided Dec. *3 Mаtthews, T. for Associates, L.P.A., Craig appellee. and T. Matthews & Craig Schisler, L.L.P., appellant. H. Shohl, Toby Dinsmore & Judge. Hall, (“Everdry”), Diversified, Inc., Everdry Waterproofing Riverfront d.b.a.
{¶ 1} stay motion to entry denying decision and its from the trial court’s appeals and to arbitration.1 compel proceedings First, Everdry assignments appeal. two of error Everdry advances denying to conduct before failing that the trial court erred
contends refusing trial court Second, Everdry claims that the erred its motion. agreement. parties’ enforce the Morаn contacted appellee Everdry reflects Geraldine record In January Everdry cracks in her home’s foundation. repairing
about gave home and Moran an estimate for inspected Eddie Joiner representative have proceeded sign Moran contract to the work. and Joiner of the contract included the work. The terms conditions perform language arbitration: following regarding claim or this “Any controversy arising relating out of or with thereof, be settled accordance by
the breach shall Association, American Industry Construction Arbitration Rules of the Arbitration Arbitrator(s) entered in judgment upon may the award rendered jurisdiction thereof.” any having Court *4 Shortly signed Everdry completed the the its parties after
{¶ 5} Thereafter, 3, 2010, complaint filed a May against Everdry, work. Moran According that the had failed her repair foundation. the alleging company Everdry completed the cracks had worsened since its work. Moran’s complaint, statutory Everdry. set forth and common-law claims complaint against She $20,000, statutory than in excess damages actual of more of sought damages $180,000. $62,000,and of punitive damages arbitra- July Everdry stay proceedings compel In moved to and to
{¶ 6} motion, the opposed clause above. Moran pursuant quoted tion the arbitration substantively uncon- that the clause was arguing procedurally and, therefore, filed a in which it reply unenforceable. noted scionable reply to the was an the absence of evidence to Moran’s claims. Attached body ruling caption of the that it sustained the motion. The 1. The trial court's indiсates clear, however, caption typographical error and that the ruling makes that the contains denied. motion was surreply affidavit from Eddie Joiner. In Moran filed a in which she response, the trial court with her own affidavit. provided 21, 2011, entry denying March the trial court filed its decision and On
{¶ 7} Everdry’s stay compel motion to and to arbitration. The trial court proceedings law, to an correctly analyzed applicable requires opponent arbitra- tion that prove clause to the clause is both Wyk, the court dеcline to enforce it. Brownell v.
unconscionable before will Van 26. Brownell Montgomery App. further trial court explains determining the considerations the should make and substantive it, evaluating facts before court stated: case, “In this by the contract was a standard form contract prepared such, Defendant and issued to Plaintiff. As the Court finds the contract was Moreover, old, adhesive in nature. Plaintiff that has averred she is 88 lives home, at and has little business Plaintiffs experience. letter sent to the Defendant and attached as 1 to reply may Exhibit Defendant’s bear on Plaintiffs claims, and tends to suggest general comprehension by level of Plaintiff of the However, by services rendered Defendant. this evidence does not bear on the enforceability of the arbitration provision understanding Plaintiffs of this facts, provision. Based on the foregoing the Court finds the arbitration provision was procedurally unconscionable. “As to whether substantively unconscionable, Defen-
dant’s estimator avers that he ‘specifically through went the terms and conditions’ with Plaintiff. Plaintiff аvers that she did not understand the arbitration provision, arbitration, has never been involved in and that the estimator did explain by that the contract signing she would be her giving up right to have her day in court. Plaintiff avers that the estimator explain did not how the work, process would provide information about pro- the arbitration cess, that explain can process expensive, explain signing arbitration, the contract she pay would have to or explain papers signed she when Defendant completed Citing its work. to the Construction Industry Procedures, Arbitration Rules and Mediation Plaintiff represents fee, she responsible would be for a filing administrative fees and various $975 (minimum hours) expenses, hourly compensation arbitrator’s fee and final fee of These projected disputed. costs have not been damages sought $300. *5 by Plaintiff do not on bear the costs the Plaintiff will incur if her case is arbitrated, or on her awareness of those prior signing costs to the contract. The Court finds that the mechanics of the process arbitration and its costs were not Plaintiff, to exрlained the and therefore the arbitration is substantively unconscionable under the circumstances of this case.” error, that the trial Everdry contends assignment In its first of denying compel its motion to hearing in to hold a before failing
court erred
not
before a trial court
required
it
that a
is
While
concedes
arbitration.
true
contends that the same is not
Everdry
stay proceedings,
rules on a motion to
2711.03,
relies on R.C.
Everdry
compel
support,
a motion to
arbitration.
for
and,
being satisfied
parties,
upon
shall hear the
which
“The court
provides:
to
with the
comply
or the failure
agreement
making
issue,
parties
to
directing
in
the court shall make
order
is not
agreement
added.)
(Emphasis
agreement.”
in accordance with the
to arbitration
proceed
19,
Homes,
2002),
No. 2001
(Apr.
App.
Clark
CA
Wayne
also
v.
L.L.C.
See
Garcia
628619,
courts to conduct a
53,
(noting
“requires
*6
that the statute
2002 WL
validity challenges”).
legitimacy
of arbitration clause
hearing to determine
review,
failure to conduct an
we find that
court’s
Upon
is
ruling
Everdry’s
compel
on
motion to
evidentiary hearing bеfore
and
Everdry
requested
hearing,
never
an oral
inherently
reversible error.
At
arguments.
of their written
least
parties
both
submitted affidavits
that a
waives its
to
party
right
courts have concluded
appellate
three other Ohio
Feldman,
Hoppel
one.
v.
Columbia
hearing by failing
request
an R.C. 2711.03
cases).
(citing
na
No. 09 CO
App.
Servs., Inc.,
relies,
Home
Lorain
case
Brunke v. Ohio State
upon
06CA008947,
filed back, home-repair containing attached front and the arbitration clause. 5, 2010, plaintiff Response On homeowner filed Plaintiffs Defen- August Arbitration, any without Stay Proceedings Compel dant’s Motion to and eviden- 11, 2010, tiary August Rеply material. On the defendant filed its Memorandum Arbitration, Stay Proceedings Compel of the Motion to with Support reply, strongly Affidavit of Eddie Joiner. In that the contractor Accompanying that it that the arbitration clause was argued plaintiffs prove was the burden unconscionable, and, plaintiff presented because whatsoever, Only no the motion to should be thereaf- compel granted. evidence seek, obtain, surreply, leave to submit her filed on plaintiff ter did 16, 2010, to the plaintiff opposition which included the affidavit September time, the arbitration clause at compel. plaintiff argued, motion to At that “Since *6 case, issue Brunke is identical to the clause this this Court arbitration should set an a evidentiary hearing it does not as matter law that if find of added.) Everdry’s motion is without merit.” (Emphasis Normally, we would determine that a cannot fail to a party request {¶ 14} evidenqe below, court, hearing submit written to the trial and complain about the here, lack of a after an But hearing only obtaining ruling. although adverse appellant request hearing, did that submitted the last рarty permitted Moreover, filing requested hearing. had the court did not determine as “matter of law that Everdry’s motion is without merit” as suggested by the plaintiff. The court’s determination was a mixed of question law and fact based on the Therefore, circumstances of this particular plaintiffs although status. we will appellant Everdry’s error, overrule first assignment upon of remand on the following error, second of assignment the court should conduct the evidentiary requested by plaintiff. The first assignment of error is overruled.
{¶ 15}
error,
its second
of
assignment
Everdry claims that the trial court
{¶ 16}
erred in refusing to enforce the parties’
agreement.
arbitration
In particular,
Everdry disputes the trial court’s finding that the arbitration clause at issue was
procedurally
In response,
unconscionable.
Moran
asserts
the trial court properly found the clause
deprived
unenforceable because it
her of
any meaningful choice and contained terms unreasonably
Everdry.
favorable to
In resolving
parties’
2711.01(A),
turn
dispute, we
first to R.C.
strong policy
reflects “a
favoring arbitration of disputеs.” Taylor Bldg.
¶
Corp.
Benfield,
Brownell v. Wyk, Montgomery Van App. 2010 ¶ 5452103, a party When claims that an in a provision contract is unconscionable, party bears proving the burden of both ¶ substantive Id. at 26. Whether an arbitration provision is a question However,
unconscionable is of law that we de novo. review Id. we of its determi- findings factual review a court’s Id. at 22-23. nation with deference. To determine whether
unconscionable,
surrounding
making
courts consider the circumstancеs
*7
¶
edu
parties’ age,
considerations include the
Id. at 27. Relevant
agreement.
cation,
acumen and
who drafted the
experience,
business
intelligence,
and whether alternative
possible,
in the
terms were
printed
whether alterations
Id.
factors
for the
or service were available.
Other
supply
product
sources of
“
by
stronger
include ‘a belief
may
unconscionability
that
indicate procedural
party
fully
that the weaker
will
probability
that there is no reasonable
party
contract;
that the weaker
will
knowledge
stronger party
party
of the
perform the
contract; knowledge
from
of the
unable to receive substantial benefits
reasonably protect
is unable to
his interests
stronger party
party
the weaker
infirmities,
or
to
ignorance, illiteracy
inability
or mental
by
physical
reason
”
¶
or
factors.’
Id. at
agreement,
understand the
of the
similar
language
provision
substantively
To determine whether an arbitration
is
{¶ 20}
unconscionable,
itself. “Factors courts
courts focus on the terms of the
in
evaluating
have considered
whether
contract is
unconscionable
terms,
rendered,
in
charge
include the fairness of the
for service
the standard
”
industry,
ability
accurately predict
liability.’
and the
the extent of future
¶
Home,
63,
prepared party O’Brien, Montgom to the contract terms.” Hawkins v. has no realistic choice as ¶ fact that a contract 25. The ery App. No. adhesive, however, it This court necessarily is does not make unconscionable. not, itself, in and of unequal bargaining position has that “an recognized unenforcea equity agreement sufficient reason law or to hold that, in consequence ble.” Id. at 24. “There must be some evidence imbalance, into position the weaker was defrauded coerced party agreement to the arbitration clause.” Id. above, As set forth aside from the adhesive nature of the arbitration (i.e., preprinted presеnted by Everdry),2
clause
it was contained
form
only
procedural unconscionability
other evidence cited
court
find
*8
home,
was Moran’s
the fact that she lived at
and her lack of business
age,
age
experience, nothing
her advanced
and lack of business
experience. Despite
infirmi
suggests
any physical
in the record
that Moran suffered from
or mental
ties,
inability
agree
to understand the
of the
ignorance, illiteracy,
language
¶
408,
63,
122
24.
Hayes,
ment.
Ohio St.3d
908 N.E.2d
old,
Although
independently
she was 88
Moran lived
and
managed
requested
her own affairs. She initiated contact with
estimate,
a
receiving
signed
estimate to have her home
After
she
repaired.
conditions,”
contract
that she had read
“terms and
which contained
indicating
It
the arbitration clause at issue. The clause was not hidden from view.
was
in the same size
as all
terms and conditions.
117
printed
type
Taylor,
other
Cf.
¶
(“As
352,
governed by Industry “the Construction Arbitration of the Rules American Arbitration Association.” The trial court was critically concerned about the fee, fees, seemingly high filing administration arbitrаtor’s compensation, and $975 final fee of an AAA filing for arbitration The factual complaint. representa- $300 tion to appears only argument as these fees in Plaintiffs Response to True, Stay Proceedings Defendant’s Motion to Arbitration. Compel Industry Construction Arbitration Rules of the American Arbitration Association However, for such fees. claim provide plaintiffs assigned whether would be to that track is not In apparent recognition so clear. of the modest nature of homeowner-construction AAA disputes, adoрted supplementary procedures for home construction disputes 2003. These rules have since been renamed as AAA Home Construction Arbitration Rules and are suggested contracts for “residential construction and Home Construction Arbitration remodeling.”
481 1, 2007, supple- preamble. effective June procedures Rules and Mediation Rules, applied Home rules, have into the Construction mentary morphed “or where rules supplementary referenced the specifically the contract whenever dispute to Prоcedures resolve mutually agree to utilize these parties supplementary, of the then importance construction.” The relating to residential Construction, filing fee for they require only rules is that and now Home $150 $10,000 $75,000. very It well be may for a level between dispute homeowner Industry Rules of that the Construction an will reveal evidentiary that these facts only apply, ones that but Arbitration Association are the American Moreover, Industry if the Construction evidentiary support. from would benefit also choose to may the trial court only apply, Rules are the ones Arbitration AAA rules pursuant' to require whether the failure to consider (which in existence industry were to the home-construction specifically applicable 2003) clause in a 2009 contract. affects an arbitration some form since Moreover, of costs alone will not “proof this court has determined 29} {¶ Garcia, *13. To establish an arbitration clause.” invalidate her regarding Moran would have to some evidence unconscionability, present costs, differential expected fees and cost “ability pay court, and whether that cost differential so litigation between arbitration and an or cause arbitration to be bringing substantial as to deter the of claims Id.; 117 Ohio judicial Taylor, unreasonable alternative to the forum.” see also that an (reasoning at 58-59 St.3d fees evidence prohibitive clause will not be held unconscionable based on absent Homes, them); Teynor’s claimant’s Rickard v. inability pay fees (N.D.Ohio (“The 2003), AAA F.Supp.2d Inc. has Administrative ‘In an AAA Fee Provision that cases where Waiver/Deferral/Hardship prоvides: a waiver or eligible administrative fee are for consideration for applies, parties if annual income 200% of gross deferral of the administration fee their falls below no of her guidelines.’ plaintiff provided the federal Because has evidence poverty (or arbitration, it is inability) income or her the costs of unclear ability pay Moreover, has not qualify plaintiff whether she would for the waiver. because information, that the AAA rules provided any income she has demonstrated similarly persons attempting deter a substantial number of situated from It is not clear on this record statutory rights”). vindicate their that they necessarily cites are prohibitively expensive arbitration costs she litigation would exceed her costs. heavily analysis, to the Moran relies opposition foregoing *10 859, (1998), 464, argue 83 Ohio St.3d 700 N.E.2d
Williams v. Aetna Fin. Co. uncon- that clause at issue was the arbitration Williams, however, different from the facts notably facts of are scionable. The Williams, In the a salesman company conspired before us. defendant with homeowners in low-income unsuspecting, elderly neighborhoods. defraud The involved the out conspiracy having homeowners take secured loans home improvements they could not afford and that would not In completed. in refusing to enforce an arbitration clause the homeowner-plaintiffs Ohio Court “The record in this case Supreme opined: clearly support would finding the arbitration clause violated all of principles equity, given attendant facts and circumstances.” Id. at 472. The court added: “When the account, i.e., further situation in complete this case is taken into Williams’s * * * regarding conspiracy evidence as the fundamental reason for her into entering agreement place, the loan in the first and also questionable dispute conditions under which the would be submitted arbitration as revealed record, in invalidity there is further for the of the arbitration clause.” Id. Williams, In since the Ohio Supreme recognized Court has
the extreme facts of that case and the role those
in
played
facts
the outcome. In
Taylor, for example,
upheld
the court
an arbitrаtion
in a
clause
consumer sales
Williams,
agreement, noting
“this is not a case like
in which the defendant
company
finance
was found to have
defraud the plaintiff.” Taylor,
conspired
51;
117 Ohio St.3d
see also Baker v.
at
Schuler,
¶48
02CA0020,
App.
decision in Brunke v. Ohio State Home
08CA009320,
Lorain App. No.
contract and finding procedural no or substantive unconscionability). the homeowners who entered into a сontract to have their basement waterproofed struggled both to read and poor comprehension demonstrated skills—facts that ¶ 12, Id. at were known to court Brunke relied on company. facts, these ease, are not the record in along Moran’s with the company’s clause, explain failure to to find Brunke found no procedural unconscionability Notably, a dissenting judge *11 lack of a facts, the things, company’s other noting, among the despite disturbing it differing facts of Brunke make thé clause. The explain arbitration duty from Moran’s case. distinguishable Brunke majority unconscionability, regard With to substantive 33}
{¶ may an arbitra- costs fees alone render “prohibitive opined on a determina- case-by-case unconscionable based tion provision ¶ face, contrary to determination tion.” Id. at 16. its this statement is our On an alone will not invalidate Garcia “proof later in of costs several indicated, event, as have the facts about any clause.” In we Also, the lacks the fraud present costs of arbitration are uncertain. case evеntual addition, Moran that drove Williams although decision. the contract contract, was of an adhesion had characteristics signed conditions, as all Moran had full transparent opportunity as other terms Also compulsion is no of or review the and there evidence duress. Williams, doing contact with unlike Moran herself initiated about home-repair could who companies, have solicited bids from other business Baker, may may required or have arbitration. Cf. Brunke reasons, foregoing distinguishable. at 48. For all of the is by that the trial сourt Because we determine facts submitted 34} {¶ finding procedural affidavit are insufficient to and substantive motion to unconscionability, compel we vacate the arbitration. overruling Nevertheless, we plaintiff requested evidentiary hearing note that the had matter, and we the case for trial court to conduct remand such proceedings opinion. and for further consistent with this accordingly.
Judgment Donovan, J., concurs. J., in judgment. concurs
Froelich, Judge, concurring judgment.
Froelich, arbitration, I am I concur in law favors judgment. Although Ohio sure, evidentiary hearing not as our just especially prior required remand, there no in the substantive relationship buyer between this and this seller.