TONY AND STEPHANIE SULLIVAN, INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, Plaintiffs-Appellants, - vs - WESTFIELD INSURANCE COMPANY, et al. Defendants-Appellees.
CASE NO. 2012-L-004
IN THE COURT OF APPEALS ELEVENTH APPELLATE DISTRICT LAKE COUNTY, OHIO
January 22, 2013
2013-Ohio-146
Civil Appeal from the Lake County Court of Common Pleas, Case No. 11CV000397. Judgment: Affirmed.
John J. Haggerty and Thomas A. Cunniff, Fox Rothschild, LLP, 2700 Kelly Road, Suite 300, Warrington, PA 18976-2624 (For Defendants-Appellees).
MARY JANE TRAPP, J.
{¶1} Appellants, Tony and Stephanie Sullivan, appeal from two judgments of the Lake County Court of Common Pleas. Thе first is an order dismissing certain named defendants from the action, while the second is an order granting appellee, Westfield Insurance Company‘s (“Westfield“), motion for summary judgment. Through the two orders, the trial court fully disposed of the action.
Substantive Facts and Procedural History
{¶3} On October 5, 1994, the Supreme Court of Ohio, in Martin v. Midwestern Group Insurance Co., 70 Ohio St.3d 478 (1994), ruled that uninsured/underinsured (“UM/UIM“) coverage followed the insureds under the policy and not the different vehicles in the household, eliminating the “other-owned vehicle exception” to UM/UIM coverage. This decision removed the necessity for insureds to pay UM/UIM premiums on each of the vehicles on their policy, allowing them to pay for such coverage on only one vehicle, but to have coverage for themselves and their resident family members while in any of their owned vehicles.
{¶4} Prior to and at the time of the Martin decision, the Sullivans had an automobile insurance policy through Westfield. Three cars were listed on the policy, and the Sullivans paid UM/UIM premiums on all three vehicles. On December 10, 1994, the Sullivans’ insurance policy was up for renewal, however, they never completed their premium payments, and Westfield cancelled their insurance policy for non-payment on June 6, 1995.
{¶6} As to the breach of contract claim, the Sullivans alleged Westfield provided “something other than whаt the parties contracted the plaintiffs would receive for payment of premiums for ‘UM’ on vehicles beyond the first; charging a fee for a ‘benefit’ which does not exist; breaching the fiduciary duty owed by the carrier to its customers; and breaching the contractual duty of good faith and fair dealing.”
{¶7} In regard to the misrepresentation and fraud count, the Sullivans asserted that Westfield represеnted to them that “the amount they were paying for vehicles after the first was for UM coverage for the named insured and family members, when that was untrue; and was instead for guest coverage.” They contended that they had so relied, to their detriment.
{¶8} Westfield, American Select, and Ohio Farmers filed a motion to dismiss the complaint, which the trial court denied in part, granted in part, and converted in рart to a motion for summary judgment. Pursuant to
{¶9} Westfield also sought dismissal pursuant to
{¶10} In its motion for summary judgment, Westfield argued, among other things, that the Sullivans’ claims were barred by the applicable statutes of limitations. The Sullivans countered that the statute of limitations as to the breach of contract claim had been tolled during the pendency of Beck v. Westfield Natl Ins. Co., Cuyahoga Common Pleas, No. CV-09-691286, 2010 Ohio Misc. LEXIS 564 (Dec. 3, 2010), and therefore their actiоn was brought within the 15-year statute of limitations, as extended. They asserted that because Beck included class action allegations, it tolled the running of the statute of limitations as to them because they were putative class members.
{¶11} As to the misrepresentation and fraud claim, the Sullivans argued that the four-year statute of limitations had been tolled by application of the discovery rule, beсause they had only recently discovered that Westfield had misrepresented the premiums as UM/UIM coverage for the insureds and family members, and not as guest coverage.
{¶13} With regard to the misrepresentation and fraud claim, the trial court found that the Sullivans had constructive knowledge of the facts giving rise to their claim, and that constructive knowledge was sufficient to begin the running of the statute of limitations. “That they were not aware of the legal significance of these charges (that the additional premiums only provided UM coverage for ‘guests’ and were not necessary to prоtect the insureds and their resident family members) does not act to toll the statute of limitations. ‘Ignorance of the law does not toll the statute of limitations.‘”
{¶14} Accordingly, the trial court granted Westfield‘s motion for summary judgment in its entirety, disposing of the case. The Sullivans timely appealed, and now bring the following assignments of error:
{¶16} “[2.] The trial court erred in dismissing the other Westfield coverage entities.”
{¶17} Westfield has brought a single cross-assignment of error:
{¶18} “The trial court did not consider alternative grounds in granting Defendant‘s Motion for Summary Judgment which dismissed Plaintiffs’ breach of contract and fraud claims on statute of limitations grounds.”
The Motion for Summary Judgment - Statute of Limitations
{¶19} In their first assignment of error, the Sullivans challenge the trial court‘s grant of summary judgment in favor of Westfield based on statute of limitations grounds. They argue that the trial court erred in not tolling the 15-year statute of limitations applicable to the breach of contract claim on account of Beck, supra, and not applying the discovery rule in determining when the 4-year statute of limitations began running on the misrepresentation and fraud claim. We find that the trial court prоperly declined to find that either statute of limitations was tolled, and thus we affirm the grant of summary judgment to Westfield on statute of limitations grounds.
Standard of Review
{¶20} We review de novo a trial court‘s order granting summary judgment. Hapgood v. Conrad, 11th Dist. No. 2000-T-0058, 2002-Ohio-3363, ¶13, citing Cole v. Am. Industries and Resources Corp., 128 Ohio App.3d 546 (7th Dist.1998). “A reviewing court will apply the same standard a trial court is required to apply, which is to
{¶21} “Since summary judgment denies the party his or her ‘day in court’ it is not to be viewed lightly as docket control or as a ‘little trial‘. The jurisprudence of summary judgment standards has placed burdens on both the moving and the nonmoving party. In Dresher v. Burt [75 Ohio St.3d 280 (1996)], the Supreme Court of Ohio held that the moving party seeking summary judgment bears the initial burden of informing the trial court of the basis for the motion and identifying those portions of the record bеfore the trial court that demonstrate the absence of a genuine issue of fact on a material element of the nonmoving party‘s claim. The evidence must be in the record or the motion cannot succeed. The moving party cannot discharge its initial burden under
Beck Did Not Toll the Breach of Contract Statute of Limitations
{¶22} Pursuant to
{¶23} The Sullivans rely on Vaccariello, supra, asserting that because the Beck case included class action allegations, the statute of limitations was tolled because they were putative class members in the Beck action. The Vaccariello court held specifically that “the filing of a class action, whether in Ohio or the federal court system, tolls the statute of limitations as to all asserted members of the class who would have been parties had the suit been permitted to continue as a class action.” Vaccariello at 382-383.
{¶24} A review of the Cuyahоga County Common Pleas Court‘s decision in Beck reveals that the action did not terminate because of a failure to secure class certification, as in Vaccariello. Instead, the Beck court disposed of the action squarely on the merits of the case. The plaintiffs in Beck brought identical claims against Westfield as the Sullivans attempted to bring here, including class action allegations. The trial court never addressed the сlass action allegations in Beck; instead, the trial
{¶25} In Vaccariello, the plaintiff was able to successfully invoke the saving statute,
{¶26} In contrast, the Beck case, where the Sullivans could potentially be class members (and indeed sought to be added), failed upon the merits. Therefore, the saving statute was not available to the Sullivans, and Vaccariello is distinguishable.
{¶27} The Sullivans’ statutory time expired in June 2010; Beck was pending at that time. In June 2010, the Sullivans essentially had to make a decision whether to file their own class action in Lake County before the statutory time expired, or gamble and wait for the outcome of the Beck case, in which the trial court could do a number of things: decide the merits; decide otherwise than on the merits; certify the class and proceed to merits; or, deny the class and proceed to merits. Under Vaccariello, the time
{¶28} The Sullivans had two choices in June 2010. The first was to hold off filing their own claim – the benefit would be saving any time and expense in filing, while the risk would be that Beck may be decided upon the merits, rendering the saving statute inapplicable. The second was to file their own claim to prоtect the statute in the event Beck failed “upon the merits.”
{¶29} The Sullivans chose the former, taking the risk that the case could be decided on the merits and not in their favor. As Judge Lucci remarked, the Sullivans should not be allowed a second bite at the apple after making their choice.
{¶30} Therefore, we find the court below correctly determined that the statute of limitations was not tolled during the pendency of Beck, and that the Sullivans failed to bring their action within the 15 year limitations period
The Discovery Rule Does Not Delay the Running of the Fraud Statute of Limitations
{¶31} Pursuant to
{¶32} “The discovery rule set forth in
{¶33} The trial court was cоrrect not to apply the discovery rule to the Sullivans’ fraud claim, because the Sullivans had knowledge of all the relevant facts back in 1994. From our review of the record, we find the Sullivans failed to meet their reciprocal burden of demonstrating that there remains a genuine issue of material fact for trial. Simply put, the Sullivans did not demonstrate why, in the exercise of due diligence from the release of the Martin decision in 1994, they could not have discovered the alleged fraud.
{¶35} Furthermore, “all persons are ‘conclusively presumed to know the law.‘” In re Estate of Holycross, 112 Ohio St.3d 203, 2007-Ohio-1, ¶27, quoting State v. Pinkney, 36 Ohio St.3d 190, 198 (1988). The Sullivans, therefore, are presumed to have known that, in a post-Martin world, UM/UIM coverage followed the insureds and not the vehicles, requiring only one premium to cover their household. While the Sullivаns may not have known what sort of coverage the additional UM/UIM premiums provided them, if anything, they were on notice back in 1994 to inquire if concerned. Therefore, the discovery rule does not apply, as the Sullivans were fully in possession of all the facts necessary to bring their claim. The fact they were not told until 16 years later, by their attorney, that they might have a claim “cannot be used to circumvent the statute of limitations or limitations would become meaningless.” Lynch at 748.
The Motion to Dismiss American Select and Ohio Farmers
{¶37} In their second assignment of error, the Sullivans argue that the trial court erred when it dismissed American Select and Ohio Farmers from the action. Because we have determined that summary judgment was appropriate on statute of limitations grounds, this assignment of error is moot. Even if it was determined that American Select and Ohio Farmers were improperly dismissed from the action, the trial court‘s grant of summary judgmеnt in favor of the defendants and this court‘s affirmance of that decision above would render any reversal of their dismissals meaningless. The Sullivans, whether upon the motion to dismiss, or the subsequent motion for summary judgment, would ultimately have been precluded from pursuing their claims against American Select and Ohio Farmers, just as they were against Westfield. The claims against American Select and Ohio Farmers wеre identical to those against Westfield, and accrued on the same date, thus they too would have been time barred and resolved through a grant of summary judgment to the defendants. Therefore, the second assignment of error is without merit.
Westfield‘s Cross-Assignment of Error
{¶38} Westfield, in an effort to protect its position and prevent the reversal of the trial court‘s decision, brought a single cross-assignment of error. However, wе need not
{¶39} Pursuant to
{¶40} Because we affirm the decision of the trial court, we decline to further consider Westfield‘s cross-assignment of error. The Sullivans’ assignments of error are without merit and the judgment of the Lake County Court of Common Pleas is affirmed.
TIMOTHY P. CANNON, P.J.,
CYNTHIA WESTCOTT RICE, J.,
concur.