First Bank of Marietta v. James C. Mitchell
| Decision Date | 21 April 1981 |
| Docket Number | 81-LW-3449,79 CA 17 |
| Parties | FIRST BANK OF MARIETTA, Plaintiff-Appellant, v. James C. MITCHELL, Defendant-Appellee. |
| Court | Ohio Court of Appeals |
James H. McCauley, Belpre, for appellee.
Roland W. Riggs, III, Marietta, for appellant.
This is an appeal from a judgment entered by the Washington County Court of Common Pleas denying relief in an action filed by the First Bank of Marietta, appellant herein and hereinafter referred to as Bank, against James C. Mitchell and Diane Mitchell, husband and wife and appellees herein. The following errors are assigned:
"I.The Trial Court Erred by Not Finding That Defendants Were Estopped From Raising The Statute Of Limitations Defense.
II.The Trial Court Erred By Not Applying The Fifteen Year Statute Of Limitations To This Case.
III.The Trial Court Erred By Not holding That The Statute Of Limitations Did Not Begin To Run Until April, 1976."
The facts pertinent to this appeal appearing in the record are for the most part, not in conflict and, in summary, the following occurred: In early 1967, James C. Mitchell, hereinafter referred to as Mitchell, was elevated from Vice-President to President and Managing Executive Officer of the First Bank of Marietta. He held such position until April, 1976. In 1958 the bank had purchased improved real property located at 305 Washington Street in Marietta, Ohio for $30,000.00 for use as a branch bank but never utilized the property for such purpose. Sometime prior to 1970 a corporation, DeBarr, Inc., had been organized with Mitchell's wife, Diane, as the sole stockholder. Mitchell managed the business affairs of the corporation. Mitchell had for sometime prior to 1970 developed an interest in acquiring the Washington Street property for real estate development. In 1968, the buildings thereon were razed under the direction of Mitchell at bank expense.
On September 29, 1970 the bank conveyed to DeBarr Inc. the real estate. On October 7, 1970 the directors of the bank approved a transfer of the property to DeBarr, Inc. and entered the following, dictated by Mitchell as Secretary to the Board of Directors, into the minutes:
After transfer of the property, apartments were erected thereon by DeBarr, Inc. On December 16, 1974, the property was conveyed to Diane Mitchell who assumed the mortgage indebtedness thereon. The stock of DeBarr was acquired by A. Patrick Tonti, a director of the Bank, who subsequently dissolved the corporation.
From the time of conveyance no further negotiations respecting the specific terms pursuant to the Bank minutes took place and no payments were ever made by any person, including DeBarr, Inc., to the Bank for the property. On May 11, 1978 the Bank filed its complaint against the Mitchells. After averring essentially the facts set forth above, the complaint averred "defendants have been unjustly enriched, jointly and severally, by their failure to make any payments whatsoever pursuant to the agreement of sale" and prayed for the recovery of $30,000.00 and interest.
By answer the Mitchells admitted the Bank "sold a tract of real estate at 305 Washington Street to DeBarr, Inc.," (although at trial Mitchell testified in effect it was a gift or bonus) and averred that "no dollar figure for remuneration was ever determined to settle the purchase price for the property," denied the complaint averments as to unjust enrichment and, as pertinent here, pled defenses of statute of limitations and laches. The court below essentially held by its findings and entry that the action was barred by R.C. 2305.07 six year statute of limitations and also by laches concluding that further negotiations were to take place in a reasonable time, which the court determined to be six months, so that the action was not timely brought. The court at trial dismissed Mrs. Mitchell as a defendant and no error is asserted herein as to such dismissal.
We would note at the outset that appellant's brief is directed solely to a claimed inapplicability of the statute of limitations. The judgment, however, rested also upon grounds that the action was barred by the statute of limitations and by the doctrine of laches. Thus, even if appellant's assignments of error are well taken, affirmance of the judgment would still be required. We, therefore, consider initially the correctness of the judgment respecting the doctrine of laches.
Succiently stated, the doctrine of laches is a defense recognized and applied by courts of equity by demanding that rights be asserted before lapse of time makes judicial inquiry difficult for various reasons and equities have intervened and, when such conditions exist, to deny the aid of the court in enforcement of such rights. Russell, Adm. v Fourth National Bank (1921) 102 Ohio St. 248. The laches rule is epitomized in the third paragraph of the syllabus in Smith v Smith (1959), 168 Ohio St. 447, wherein it is stated, "Delay in asserting a right does not of itself constitute laches, and in order to successfully invoke the equitable doctrine of laches it must be shown that the person for whose benefit the doctrine will operate has been materially prejudiced by the delay of the person asserting his claim."
While the historical relationship between the equitable doctrine of laches as applied by equity courts and statutes of limitations as applied by law courts when such courts separately existed differed, after the fusion of such courts in Ohio and the application of statutes of limitation to equitable actions, the doctrine of laches was important only to the extent it would bar relief prior to the expiration of the applicable statute of limitations. 20 Ohio Jur.2d 174, Sec. 82. In sum, the applicable period of limitation provided by statute is normally controlling. Hill v Irons (1952), 92 Ohio App. 141.
Inasmuch as the trial court found the action barred by the statute of limitation, presumedly the court concluded that irrespective of such statutory limitation, the doctrine applied. We disagree. From our review of the record we find no factor indicative that Mitchell was materially prejudiced by the delay in instituting the action. There is nothing perceiveable in the record that would render a judgment requiring payment for the property either unjust or inequitable under the circumstances. We, therefore, consider the errors assigned respecting the applicability of the statute of limitations.
Appellant counsel for the Bank is not the same counsel at trial. As a result the Bank is advancing in this court legal theories respecting the statute of limitations different from those advanced at trial. As a general proposition a party is confined upon appeal to the theory upon which the case was presented to the trial court and cannot litigate new issues not presented to the trial court. 5 Am.Jur.2d 29, Sec. 545 and 546. The rule is followed in Ohio...
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