172 Ohio App. 3d 523 | Ohio Ct. App. | 2007
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *525 {¶ 1} Plaintiff-appellant, Cheryl Rakich, appeals from the final judgment of the Franklin County Court of Common Pleas dismissing her claims against defendants-appellees, Erica M. Kanoski and John E. Kanoski, and incorporating the prior interlocutory judgment denying appellant's motion for summary judgment and granting appellees' motion for summary judgment. Because the trial court erred in ruling on the parties' motions for summary judgment, we reverse.
{¶ 2} On March 31, 2005, appellant and her husband, Duke Rakich (collectively, "plaintiffs"), filed the instant action against Anthem Blue Cross and Blue Shield, appellees, and various John Does, alleging claims arising out of an automobile collision that occurred on April 13, 2004. In the complaint, appellant asserted a claim for personal injury against appellees and a claim for declaratory judgment regarding subrogation rights against Anthem Blue Cross and Blue Shield, her medical insurer.1 As part of her claim against appellees, appellant alleged:
As a direct and proximate result of the Defendant's negligent acts, [appellant] incurred undetermined miscellaneous expenses in the past and expects to incur miscellaneous expenses into the future including but not limit[ed] to property damage diminutive value to the vehicle involved in the collision.
The complaint also included Duke Rakich's claim against appellees for loss of consortium.
{¶ 3} On December 27, 2005, plaintiff's moved for summary judgment on the issue of liability. The trial court granted the plaintiffs' unopposed motion for summary judgment on liability on May 16, 2006.
{¶ 4} On April 4, 2006, the trial court conducted a status conference and ordered the plaintiff's to file a motion for partial summary judgment regarding the availability of a claim for the diminished value of their vehicle after it was repaired on or before May 26, 2006. According to plaintiffs, the parties and the trial court agreed that the motion would address only whether such a claim exists *526 in Ohio. On April 13, 2006, plaintiff's filed their motion for summary judgment regarding their right to assert a claim for the diminished value of their vehicle after it was repaired. On April 20, 2006, appellees filed a combined memorandum in opposition to plaintiffs' motion for summary judgment and in support of their own motion for summary judgment regarding the availability of a claim for diminished value. The parties fully briefed both motions for summary judgment.
{¶ 5} On August 7, 2006, the trial court issued a decision and entry denying plaintiffs' motion for summary judgment and granting appellees' motion for summary judgment regarding the availability of a claim for the postrepair diminished value of plaintiffs' vehicle. The trial court concluded that Ohio law provides two exclusive and alternative methods to calculate property damages: diminution of value and cost of repairs. Because plaintiff's had already recovered the cost of repairs to their vehicle, the trial court concluded that "plaintiff's cannot present evidence of the future lesser resale value of their vehicle in order to establish their property damage."
{¶ 6} On September 25, 2006, the trial court entered final judgment dismissing plaintiffs' claims with prejudice. Appellant filed a timely notice of appeal and now asserts the following single assignment of error:
The trial court erred in holding that plaintiff appellant was not entitled to present evidence on the diminished value of her automobile, which was damaged by the defendant's negligence.
In her assignment of error, appellant challenges the trial court's ruling on the parties' motions for summary judgment regarding the availability of a claim for the diminished value of her automobile. Specifically, appellant challenges the trial court's legal conclusion that she was, as a matter of law, prohibited from obtaining property damages for the postrepair diminished value of her vehicle, as a result of its having been involved in a collision, in addition to recovering the cost of repairs.
{¶ 7} Appellate review of summary judgments is de novo. Koos v. Cent. Ohio Cellular, Inc. (1994),
{¶ 8} The rules controlling recovery of compensatory damages to personal property generally apply to cases involving damage to vehicles. Maloney v. Gen. TireSales, Inc. (1973),
{¶ 9} With respect to a party's right to recover for damage to his or her vehicle caused by the negligence of another, Ohio courts have provided specific guidance. The Ohio Supreme Court set forth the general rule for calculating such damages in Falter v. Toledo (1959),
{¶ 10} In Falter, the Supreme Court considered a procedural question of pleading relating to the plaintiffs' claim for damage to their automobile. The plaintiff's had alleged the reasonable costs to repair their damaged automobile, stating that that amount represented the depreciation in the reasonable value of the automobile as a result of a collision. The trial court denied the defendants' motion to strike the plaintiffs' allegation regarding the costs of repair and entered judgment in favor of the plaintiffs. On appeal, the defendants argued that the plaintiff's were required to allege the difference between the market value of their vehicle immediately before and after the collision and not the cost of repairs. Noting the plaintiffs' allegation that the cost of repairs equaled the depreciation *528 of their vehicle as a result of the collision, the Supreme Court found that it was not erroneous for the plaintiff's to plead the reasonable cost of repairs, stating:
Of course it was not necessary to do so since it would have been sufficient for the plaintiff's to allege the difference in the market value before and after the collision. But it clearly was proper for the plaintiff's to allege, prove and recover the reasonable cost of repairs, provided that such cost did not exceed the difference in market value before and after the collision.
Falter,
{¶ 11} When proving damages to a vehicle with evidence of the cost of repairs, the plaintiff is ordinarily also required to present evidence of the market value of the vehicle before and after the accident so that the court may ensure that the cost of repairs does not exceed the difference in market value. In Allstate Ins. Co. v. Reep (1982),
While the usual measure of damages in a case such as this would be the difference between the fair market value of the car before and after the accident, an alternative method — the cost of repair — is an acceptable measure of damages if the cost of repair does not exceed the amount of damages that would be arrived at using the primary measure of damages. In other words, the cost of repair must not exceed the diminution in market value. Nor may the cost of repair exceed the fair market value of the property before the accident. Newark Gardens, Inc. v. Royal Globe Insurance Co., Inc. (Feb. 11, 1982), Franklin App. No. 81AP-618 [
1982 WL 3905 ], unreported.
The record in Allstate contained only evidence regarding the cost of repairs, introduced without objection to the absence of evidence of diminution in market value of the plaintiffs' vehicle. This court held that the defendant waived any objection to the absence of such evidence and determined that the plaintiff's were entitled to judgment for the full amount of the cost of repairs.
{¶ 12} Despite this court's acknowledgment inAllstate that an objection to the absence of market-value evidence may be waived, this court has subsequently *529
affirmed the requirement of such evidence in damage determinations. In Auto Owners Ins. Co. v. Santilli
(Jan. 23, 1996), Franklin App. No. 95APG06-771,
{¶ 13} Appellees argue and the trial court held that diminution in value and cost of repairs are separate, exclusive, and alternative methods to calculate damages to an automobile. We agree with appellees that a plaintiff may not recover both the cost of repairs to her vehicle and the difference in the market value of the vehicle immediately before and immediately after the accident. A damage award comprising both the difference in a vehicle's market value immediately before and after the accident and the reasonable cost of repairs presents a classic example of double recovery because those measures of damages overlap. See Am. Serv.Ctr. Assoc, v. Helton (D.C.App. 2005),
{¶ 14} Our agreement with appellees that appellant, having recouped the cost of repairs to her vehicle, may not now recover the difference between the market value of her vehicle immediately before and after the accident, however, does not resolve the legal question presented by this case. Appellant does not seek an additional award of the difference between the market value of her vehicle immediately before and after the accident but, rather, contends that the cost of repairs did not fully compensate her for the loss caused by appellees' negligence. Specifically, appellant contends that her vehicle, as repaired, has a value less than *530
its preaccident market value. Thus, appellant asserts that she is entitled to recover the difference between the market value of her automobile immediately before the accident and the market value of her vehicle immediately after its repair. We refer to such damages as "residual diminution in value." Unlike the gross diminution in value that Ohio courts have recognized as the preferred method of calculating damages to a motor vehicle, the residual diminution in value, realized because of a vehicle's involvement in a collision, does not overlap the cost of repairs, "because it is calculated based on a comparison of the value of the property before the injury andafter repairs are made, i.e., excluding injury compensated by damages for the cost of repair." (Emphasis sic.) Helton,
{¶ 15} The Restatement of the Law 2d, Torts (1979) 543, Section 928, acknowledges the appropriateness of a damage award for residual diminution in value:
When one is entitled to a judgment for harm to chattels not amounting to a total destruction in value, the damages include compensation for
(a) the difference between the value of the chattel before the harm and the value after the harm or, at his election in an appropriate case, the reasonable cost of repair or restoration, with due allowance for any difference between the original value and the value after repairs * * *.
(Emphasis added.) See, also, Annotation, Measure of Damagesfor Destruction of or Damage to Automobile Other ThanCommercial Vehicle (1947), 169 A.L.R. 1100, 1112,
{¶ 16} In Helton, the District of Columbia Court of Appeals faced a scenario nearly identical to that now before this court and under case precedent nearly identical to that presented by Falter andAllstate in Ohio. There, the owner of a vehicle damaged in a collision recovered the cost of repairs but subsequently filed suit seeking compensation for the residual diminution in value of the vehicle after repair. The trial court granted summary judgment in favor of the defendant, concluding that D.C. law provided for two alternative standards for calculating damages and that the plaintiff had already been compensated by one of those *531
methods, the cost of repairs. The trial court relied onKnox v. Akowskey (D.C.App. 1955),
{¶ 17} The Helton court concluded that nothing in its prior decisions explicating the alternative methods of calculating damages foreclosed a plaintiff's recovery of residual diminution in value upon a showing that repair is insufficient to restore the vehicle to its preaccident value. Noting that the purpose of a damage award is to make the injured party whole again, the court stated that for certain property, repair will achieve this goal, and recovery of the cost of repairs will suffice. However, the court went on to acknowledge that "for some property, the additional recovery for residual diminution in worth is necessary to make the injured party whole." Id.,
If the [chattel] is completely destroyed, the plaintiff receives the market value. To be consistent, the plaintiff should be put in the same position when his injured vehicle is repairable; he should have a vehicle of the same market value. If the repaired vehicle does not have the same market value, the plaintiff should receive additional damages. To do otherwise would put the plaintiff in a different position depending on whether the vehicle was partially or completely destroyed.
Id. at 243, citing Fred Frederick Motors, Inc. v.Krause (1971),
{¶ 18} In addition to the District of Columbia, other jurisdictions that have considered the availability of damages for residual diminution in value in addition to the cost of repair have overwhelmingly permitted recovery of such damages. See, e.g., Farmers Ins. Co. of Arizona v. R.B.L.Invest. Co. (1983),
{¶ 19} We find the reasoning of the District of Columbia court in Helton persuasive. Like the court found in Helton, we find nothing in Ohio precedent, including Falter or Allstate, that forecloses a plaintiff's recovery of residual diminution in value in addition to the cost of repairs, provided that the plaintiff proves that the damages for the cost of repairs did not fully compensate for the loss occasioned by the defendant's negligence. In fact, some Ohio courts have recognized that the cost of repairs may not indicate the actual damage to a vehicle. See Velazco v. Kesner (July 13, 1990), Allen App. No. 1-88-55,
{¶ 20} Before concluding, we first address appellees' remaining arguments against appellant's claim for residual diminution in value. Appellees argue that Ohio law does not recognize as compensable damages the loss of potential resale value because that loss is speculative. While appellees are correct that damages must be shown with reasonable certainty and may not be based upon mere speculation or conjecture, Corwin,
{¶ 21} Appellees also argue that Ohio has built into its accepted property-damage calculations a means of preventing windfalls to plaintiffs. In support of their argument, appellees cite the Third District Court of Appeals' opinion in Freeman v. Blosser, Hancock App. No. 5-06-06,
{¶ 22} Lastly, appellees contend that recognition of a claim for residual diminution in value as a result of a vehicle's involvement in an accident would promote increased litigation of property-damage claims, requiring each party to hire an expert to testify regarding the effect of an accident on the vehicle. We disagree. Because evidence of a vehicle's value immediately before and after an accident is already required, we foresee no additional burdens on the parties of presenting evidence of a vehicle's market value after it is repaired.
{¶ 23} Upon review, we conclude that the trial court erred in concluding that damages for residual diminution in value in excess of the cost of repairs are unavailable as a matter of law in Ohio and in prohibiting appellant from presenting evidence that the repairs to her vehicle did not adequately compensate her for the loss of value to her vehicle caused by appellees' negligence. None of the precedent cited by appellees prohibits such evidence or an award of such *534
damages, which may be necessary, in some cases, to make a plaintiff whole. Because the trial court denied appellant's motion for summary judgment and granted appellees' motion for summary judgment based solely on its conclusion that Ohio law does not provide for recovery of residual diminution in value, the trial court erred. We note, however, that while appellant is entitled to present evidence of the market value of her vehicle after repairs, it remains for the trier of fact to determine the amount of damages to which appellant is entitled. Moreover, a reviewing court will not disturb a trial court's determination of damages absent an abuse of discretion.Reida v. Thermal Seal, Inc., Franklin App. No. 02AP-308, 2002-Ohio-6968,
{¶ 24} For the aforestated reasons, we sustain appellant's assignment of error, reverse the judgment of the Franklin County Court of Common Pleas, and remand this matter for further proceedings consistent with this opinion and the law.
Judgment reversed and cause remanded.
BROWN and TYACK, JJ., concur.