Frate v. Al-Sol, Inc., 73459.

CourtUnited States Court of Appeals (Ohio)
Citation722 NE 2d 185,131 Ohio App.3d 283
Docket NumberNo. 73459.,73459.
PartiesFRATE, d.b.a. Empirical Sound, Appellee, v. AL-SOL, INC., d.b.a. The Edge, et al., Appellants.
Decision Date03 May 1999

131 Ohio App.3d 283
722 NE 2d 185

FRATE, d.b.a. Empirical Sound, Appellee,
v.
AL-SOL, INC., d.b.a.
The Edge, et al., Appellants.*

No. 73459.

Court of Appeals of Ohio, Eighth District, Cuyahoga County.

Decided May 3, 1999.


131 Ohio App.3d 284

COPYRIGHT MATERIAL OMITTED

131 Ohio App.3d 285

David G. Finley, for appellee.

Marlene N. Lally, for appellants, Al-Sol, Inc., A & E Investment Co., and Alex Solomon.

Coltman & Valore Co., L.P.A., and Brian C. Cruse, for Denise Savastano.

131 Ohio App.3d 284

ROCCO, Judge.

This case is before the court on appeal from a judgment of the court of common pleas awarding compensatory damages of $19,336 plus attorney fees to appellee Michael Frate, d.b.a. Empirical Sound, on his claims for breach of a lease agreement and conversion of his sound equipment and requiring appellants, Alex Solomon, Al-Sol, Inc., d.b.a. The Edge ("Al-Sol"), and A & E Investment Company, d.b.a. The Edge ("A & E"), to indemnify their co-defendant, Denise Savastano. Appellants argue:

"I. The trial court committed prejudicial error by permitting plaintiff to maintain an action based on claims of an unregistered trade name or fictitious entity over the objections and affirmative defense of defendants-appellants.

"II. The trial court committed prejudicial error by awarding contract damages based on a contract to which defendants-appellants were not party.

"III. The trial court committed prejudicial error in granting judgment for indemnification in favor of co-defendant Savastano and against all three defendants-appellants where the only cross-claim pled by Savastano was against co-defendant Al-sol, Inc., only sic ."

For the following reasons, the court finds that the trial court should have dismissed appellee's claim for breach of the lease agreement because appellee lacked capacity to pursue that claim. The trial court also abused its discretion by ordering appellants A & E and Solomon to indemnify Savastano. Therefore, the judgments on Frate's claim for breach of the lease agreement, the award of attorney fees based on the lease agreement, and the judgment requiring Solomon and A & E to indemnify Savastano are reversed. The trial court's judgments on Frate's claim for conversion and the court's judgment requiring Al-Sol to indemnify Savastano are affirmed.

131 Ohio App.3d 286

PROCEDURAL HISTORY

Appellee Michael Frate originally filed his complaint on December 20, 1995, asserting claims against Solomon, Al-Sol, and A & E for breach of a rental agreement and conversion of Frate's sound equipment. Several months later, Frate amended his complaint to include claims for breach of contract and conversion against new party defendants Denise Savastano and Eric Buckner.1 Savastano cross-claimed against Al-Sol, contending that Al-Sol should indemnify her for any liability she might have to Frate.

On the day trial was scheduled to begin, appellants moved to dismiss the amended complaint, arguing that Frate wrongfully attempted to prosecute this action under a trade name or fictitious name without having complied with the registration requirements of R.C. 1329.01. The court orally struck the motion to dismiss because it was filed without leave of court after the dispositive motion cut-off date.

A bench trial was conducted on August 14, 1997. Following the trial, on September 2, 1997, the court entered an opinion and order finding that "the defendants failed to make the monthly rental payments upon being due, and were therefore in default under the lease" agreement with Frate. The court further found that Savastano and Buckner entered into the lease agreement as agents of The Edge's manager, Donald Kollecker, and that Kollecker had apparent authority to act for Solomon, A therefore, Solomon, A & E, and Al-Sol were bound by the lease agreement. Finally, the court found defendants had converted Frate's equipment. The court entered judgment in the amount of $19,336 against all defendants jointly and severally and granted judgment in favor of defendant Savastano on her cross-claim against defendants Solomon, A & E, and Al-Sol. The court also awarded Frate a reasonable attorney fee, the amount of which was to be determined at a future hearing.

On October 24, 1997, the court awarded fees of $4,000 against Al-Sol, A & E, and Solomon. In addition, the court appointed a receiver to take possession of, manage, and sell these defendants' nonexempt property to satisfy the judgment. This appeal was timely2 filed on November 5, 19973

131 Ohio App.3d 287

LAW AND ANALYSIS

A. Appellee's Capacity to Sue Under R.C. 1329.10(B)

In their first assignment of error, appellants assert the trial court should have dismissed appellee's complaint because appellee lacked capacity to sue pursuant to R.C. 1329.10, which provides:

"(B) No person doing business under a trade name or fictitious name shall commence or maintain an action in the trade name or fictitious name in any court in this state or on4 account of any contracts made or transactions had in the trade name or fictitious name until it has first complied with section 1329.01 * * * but upon compliance, such an action may be commenced or maintained on any contracts and transactions entered into prior to compliance."

R.C. 1329.01(C) requires any person doing business under a "fictitious name"5 to report the use of the name to the secretary of state unless the name is registered as a "trade name"6 under R.C. 1329.01(B).

Notably, R.C. 1329.10(B) does not preclude the commencement or maintenance of an action merely because business was transacted in an unregistered trade or fictitious name. Instead, it provides that an action may not be commenced or maintained until the name is registered. Upon registration, an action may be commenced or maintained on any contracts or transactions entered into prior to compliance. New Method Textiles, Inc. v. TGI Friday's, Inc. (June 28, 1994), Franklin App. No. 93APG10-1360, unreported, 1994 WL 312915.

This court has previously described the effect of R.C. 1329.10(B) as a denial of "standing," MBA Realty v. Little G, Inc. (1996), 116 Ohio App.3d 334, 337-338, 688 N.E.2d 39, 41-42. However, the statute more accurately denies the user of a fictitious name the capacity to sue. Buckeye Foods v. Bd. of Revision (1997), 78 Ohio St.3d 459, 461, 678 N.E.2d 917, 918-919; Ebner v. Caudill (1994), 93 Ohio App.3d 785, 786-787, 639 N.E.2d 1231, 1232-1233. Capacity to sue may be raised by "specific negative...

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6 cases
  • Oldendick v. Crocker
    • United States
    • United States Court of Appeals (Ohio)
    • September 1, 2016
    ...capacity to sue on any contract made in the fictitious name until the name is registered. See, e.g., Frate v. Al–Sol, Inc., 131 Ohio App.3d 283, 288–289, 722 N.E.2d 185 (8th Dist.1999) ; Ebner v. Caudill, 93 Ohio App.3d 785, 787, 639 N.E.2d 1231 (10th Dist.1994) (where a landlord enters int......
  • Orum Stair, LLC v. GJJG Enters., LLC, 15AP–507.
    • United States
    • United States Court of Appeals (Ohio)
    • September 29, 2016
    ...commencement of an action because business was transacted in an unregistered trade or fictitious name. Frate v. Al–Sol, Inc., 131 Ohio App.3d 283, 287, 722 N.E.2d 185 (8th Dist.1999). The statute denies the user of an unregistered trade name the capacity to sue. Id., citing Buckeye Foods v.......
  • State ex rel. Downs v. Panioto, 2005-0447.
    • United States
    • United States State Supreme Court of Ohio
    • January 11, 2006
    ...* the capacity of any party to sue or be sued * * *, he shall do so by specific negative averment * * *"); Frate v. Al-Sol, Inc. (1999), 131 Ohio App.3d 283, 287-288, 722 N.E.2d 185. {¶ 31} In addition, there are circumstances in which an incompetent person can maintain an action for divorc......
  • State v. Hayes, 2002 TRD 1583.
    • United States
    • Court of Common Pleas of Ohio
    • July 1, 2002
    ...Vehicles, Santa has been a "real person" since as early as 1982. {¶ 23} By way of analogy, the court in Frate v. Al-Sol, Inc. (1999), 131 Ohio App.3d 283, 287, 722 N.E.2d 185, fn. 5, {¶ 24} "`Fictitious name' means a name used in business or trade that is fictitious and that the user has no......
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