Fifth Third Bank v. West, 87

• Decision Date: 13 September 1988
• Docket Number: No. 87,87
• Citation: 537 N.E.2d 262,42 Ohio Misc.2d 26
• Parties: FIFTH THIRD BANK v. WEST. * CV 34506.
• Court: Ohio Court of Common Pleas

Page 26

42 Ohio Misc.2d 26

537 N.E.2d 262

FIFTH THIRD BANK v. WEST. ^*

No. 87 CV 34506.

Hamilton County Municipal Court, Ohio.

Sept. 13, 1988.

Syllabus by the Court

1. Delay in asserting a claim does not of itself constitute laches, and in order to successfully invoke the equitable doctrine, material prejudice must be shown. The type of prejudice which may be shown is of two types: (1) the delay has resulted in the loss of the evidence which would support the defendant's position, or (2) the defendant has changed his position in a way that would not have occurred if the plaintiff had not delayed.

2. Laches may apply even though the applicable statute of limitations has not expired, upon a showing of material prejudice.

Jack A. Jennewein, Cincinnati, for plaintiff.

Saul A. Fettner, Cincinnati, for defendant.

MARK P. PAINTER, Judge.

This case was tried to the court on scant evidence. The testimony was adduced from two witnesses only: the present recovery manager for plaintiff Fifth Third Bank and the defendant. No other witnesses were produced.

I Facts

On August 25, 1976, the defendant, David C. West, purchased a 1973 Vega from Superior Chevrolet in Cincinnati. The purchase price of the Vega was $1,457.78 including sales tax, less a $200 down payment made by defendant at the time of purchase. As was its custom, Superior Chevrolet assisted defendant in financing the balance of the purchase price of the Vega through a loan with the plaintiff, Fifth Third Bank. The defendant completed the required paperwork at the dealership and obtained title to the Vega subject to plaintiff's lien for the loan amount of $1,552, which was the total of payments to be made, including interest.

The defendant testified to the following series of events and his testimony was unrebutted. The defendant took possession of the Vega on the purchase date and, almost immediately thereafter, the Vega demonstrated signs of mechanical trouble. Three days after the sale, the car stopped running. The defendant towed the car to Superior Chevrolet, which made carburetor repairs. A week or more later the car stopped running again, and again the car was towed to Superior. This time, the problem was diagnosed by Superior Chevrolet as a cracked engine block and Superior made appropriate repairs. During this time, the Vega was covered by Superior Chevrolet's ninety-day warranty, which included a no-cost towing feature. Defendant was promised on both occasions that he would be reimbursed for towing, but he never received reimbursement.

Two weeks after this second repair, defendant's Vega again refused to start. According to the defendant's testimony, another phone call to Superior Chevrolet prompted a response that the car dealer had put a new engine in the car, that it should start, that defendant was too much trouble and that the dealership had no intention of dealing with defendant any further. The defendant replied that he was not going to pay for the car.

The defendant then turned to plaintiff bank for assistance, and was referred by an unidentifiable female bank employee to her boss (who is now also unidentifiable by plaintiff). The bank official informed defendant that he could not help in the matter, to which the defendant announced his intention not to make further payments on the car, informing the bank official where the immobile Vega was located. The defendant placed the keys in the ashtray, and walked away from the 1973 Vega, hearing nothing further on the matter for over ten years, when this lawsuit was instituted. Superior Chevrolet has not been joined as a party.

Plaintiff bank's recovery manager was able to testify only from business records, since he did not become employed by the bank until ten years after the transaction in question.

According to plaintiff's records from 1976, no notation of defendant's phone calls exists. The plaintiff's records did indicate, however, that as of April 1977, loan payments totalling $323.50 were made by defendant, although defendant claims he made only one installment loan payment. The bank claims that the amount now due, including interest, is $2,163.57.

The loan account was charged off on September 22, 1977, having been past due for five months with $1,229.30 outstanding on the debt. In April 1978, the account was turned over to a credit agency.

According to bank records, numerous unsuccessful attempts were made to contact the defendant. Notations on the records indicate that defendant's ex-wife, former employers and a cousin were contacted, but none of the contacts knew of defendant's whereabouts. The record also indicates that, for some inexplicable reason, defendant was probably never contacted at his residence, although the bank knew his address. The defendant also testified that he has lived in Hamilton County continuously since April 1977. The bank records were sketchy at best, and no one was able to testify personally as to any of the bank's actions.

II Law

The equitable doctrine of laches may be used as a defense against an adverse party who seeks to enforce a claim after an unreasonable delay, and after such delay has materially prejudiced the defending party. Smith v. Smith (1959), 168 Ohio St. 447, 455, 7 O.O.2d 276, 280-281, 156 N.E.2d 113, 119.

"Delay in asserting a right does not of itself constitute laches," and in order to successfully invoke the equitable doctrine, material prejudice must be shown. Id. at paragraph three of the syllabus. The prejudice necessary in order to invoke the defense of laches may be of two types: "(1) the delay has resulted in the loss of the evidence which would support the defendant's position; or (2) the defendant has changed his position in a way that would not have occurred if the plaintiff had not delayed." Tobacco Workers Internatl. Union, Local 317 v. Lorillard Corp. (C.A.4, 1971), 448 F.2d 949, 958-959.

In the case at hand, defendant must prove not only that plaintiff unreasonably delayed in asserting its claim...