Jezerinac v. Dioun

• Decision Date: 20 February 2020
• Docket Number: No. 18AP-479,18AP-479
• Citation: 2020 Ohio 587,152 N.E.3d 430
• Parties: Ronald M. JEZERINAC et al., Plaintiffs-Appellees, v. Mo M. DIOUN et al., Defendants-Appellants.
• Court: Ohio Court of Appeals

152 N.E.3d 430

2020 Ohio 587

Ronald M. JEZERINAC et al., Plaintiffs-Appellees,

v.Mo M. DIOUN et al., Defendants-Appellants.

No. 18AP-479

Court of Appeals of Ohio, Tenth District, Franklin County.

Rendered February 20, 2020

DECISION

KLATT, J.

{¶ 1} This case involves an appeal of three orders issued by the Franklin County Court of Common Pleas in connection with a receivership for a business that owns and operates a successful restaurant, pub, and classic arcade. The parties are joint owners of the business who had a falling out and were deadlocked on a number of significant management issues. That deadlock caused them to request the receivership. Essentially, the purpose of the receivership was to operate the business until the receiver could effectuate a "business divorce" between the parties by an equitable and orderly sale of the business, with the goal of maintaining it as a going concern. One of the business's most valuable assets was its favorable long-term lease for its prime business location. Consequently, the lease and the contractual rights of the landlord became the focus of the trial court's evaluation of purchase offers. Defendants-appellants, Mo and Mina Dioun, challenged the trial court's rejection of one purchase offer and its approval of another purchase offer. In a two-to-one decision, this court in Jezerinac v. Dioun , 10th Dist., 2019-Ohio-726, 132 N.E.3d 238 (" Jezerinac I "), reversed and remanded the judgment of the trial court.

APPLICATION FOR RECONSIDERATION

{¶ 2} On March 11, 2019, plaintiffs-appellees, Ronald M. Jezerinac and Tiffany Sexton, filed an application for reconsideration of Jezerinac I pursuant to App.R. 26(A)(1). App.R. 26(A) provides a mechanism by which parties may prevent miscarriages of justice that could arise when an appellate court makes an obvious error or renders an unsupportable decision under the law. State v. Harris , 10th Dist. No. 13AP-1014, 2014-Ohio-672, 2014 WL 747201, ¶ 8. When presented with an application for reconsideration pursuant to App.R. 26(A)(1), an appellate court must determine whether the application calls to the court's attention an obvious error in its decision or raises an issue for consideration that was either not considered at all or was not fully considered by the court when it should have been. Electronic Classroom of Tomorrow v. State Bd. of Edn. , 10th Dist. No. 17AP-767, 2019-Ohio-1540, 2019 WL 1858225, ¶ 3 ; State v. Wade , 10th Dist. No. 06AP-644, 2008-Ohio-1797, 2008 WL 1723671, ¶ 2, discretionary appeal not allowed , 119 Ohio St.3d 1415, 2008-Ohio-3880, 891 N.E.2d 772, cert. denied , Ohio v. Wade , 555 U.S. 1126, 129 S.Ct. 921, 173 L.Ed.2d 158 (2009) ; Matthews v. Matthews , 5 Ohio App.3d 140, 450 N.E.2d 278 (10th Dist.1981). However, an application for reconsideration is not intended for instances where a party simply disagrees with the logic or conclusions of the court. State v. Burke , 10th Dist. No. 04AP-1234, 2006-Ohio-1026, 2006 WL 541240, ¶ 2. Furthermore, an application for reconsideration is not a means to raise new arguments or issues. Electronic Classroom , ¶ 3, citing State v. Wellington , 7th Dist. No. 14 MA 115, 2015-Ohio-2095, 2015 WL 3487120, ¶ 9.

{¶ 3} In Jezerinac I , a majority of this court found that the trial court, in evaluating competing offers for the purchase of the tenant's business, committed an error of law when it recognized the enforceability of a default provision in a commercial lease between the Brewpub Restaurant Limited Partnership ("tenant") and Brewery Real Estate Partnership ("landlord"). The tenant and its general partner, Brewpub Restaurant Corporation ("BRC"), were in receivership. Contrary to the trial court's finding, Jezerinac I viewed the appointment of a receiver for the tenant and BRC as a "technical rather than substantive default" of the lease that did not necessarily trigger the landlord's right to terminate the lease. Jezerinac I at ¶ 30-31. In any event, Jezerinac I found that no default event had occurred because the appointment of a receiver for the tenant and BRC constituted a default of the lease only if the receivership was not set aside within 30 days. According to Jezerinac I , the trial court stayed the running of this 30-day period, thereby avoiding a default event. Id. at ¶ 32. Jezerinac I also found the trial court committed an error of law when it found that the lease could not be assigned without the landlord's consent. Because it found that (1) no default event had occurred, (2) the landlord had no right to terminate the lease, and (3) the lease was assignable to certain parties without the landlord's consent (and to other parties with the landlord's consent which could not be unreasonably withheld), Jezerinac I reversed the trial court's judgment and remanded the case for consideration of purchase offers for the tenant's business from parties to whom the lease was potentially assignable.

{¶ 4} In their application for reconsideration, the appellees make a number of interrelated arguments for why Jezerinac I contains obvious errors and should be reconsidered by this court. Appellees argue that Jezerinac I (1) applied the wrong standard of review; (2) refused to enforce unambiguous lease terms; (3) misinterpreted and/or ignored the scope of the trial court's stay orders; (4) failed to recognize that the tenant no longer has a general partner; and (5) issued instructions on remand that cannot be implemented under the terms of the operative agreements. For the reasons set forth below, we agree with appellees that Jezerinac I contains obvious errors. However, before addressing the substantive grounds for our reconsideration of Jezerinac I , we must address two collateral issues raised by the parties.

ALLEGED JUDICIAL CONFLICT

{¶ 5} Although not technically raised as a ground for reconsideration, appellees challenge the impartiality of a former judge of this court (Judge Horton) and a current member of this panel (Judge Brunner) who comprised the majority decision in Jezerinac I . Although their theory is not entirely clear, appellees state that "there is an inescapable appearance of impropriety that cannot be cured as he [Judge Horton] was represented by a fellow panelist's [Judge Brunner's] husband throughout his disciplinary proceedings." (Appellees' Application for Recons. at 9-10.) This argument is baseless.

{¶ 6} As previously noted, an application for reconsideration is not an appropriate vehicle to raise new arguments or issues. Electronic Classroom at ¶ 3. The disciplinary charges against Judge Horton were widely publicized long before this case was briefed, argued, and decided by the original panel and no party challenged Judge Horton's or Judge Brunner's ability to fairly and objectively participate as judges on the original panel. If appellees had concerns about their ability to sit on this case during the adjudication of Judge Horton's disciplinary charges, they could have raised it. Appellees cannot wait until they receive an adverse judgment to raise a disqualification issue. State v. Castile , 10th Dist. No. 13AP-10, 2014-Ohio-1918, 2014 WL 1851942, ¶ 13 ("party may be considered to have waived its objection to the judge when the objection is not raised in timely fashion and the facts underlying the objection have been known to the party for some time"). Calypso Asset Mgt., LLC v. 180 Industrial, LLC , 10th Dist., 2019-Ohio-2, 127 N.E.3d 507 (2019) (memorandum decision) ("A request for disqualification, post-judgment, is inappropriate.").

{¶ 7} Appellees do not articulate what appearance of impropriety or conflict of interest is created, or what provisions of the code of judicial conduct are somehow implicated, by Judge Brunner's husband representing Judge Horton in Judge Horton's disciplinary proceedings. The conduct giving rise to those disciplinary proceedings had nothing to do with this appeal or with the exercise of Judge Horton's or Judge Brunner's judicial responsibilities as appellate judges. We emphatically reject appellees' assertion that the participation of Judge Brunner and Judge Horton on the original panel was in any way improper.

PARTICIPATION OF NEW PANEL MEMBER

{¶ 8} Appellants take exception to Judge Horton's successor participating in this decision following Judge Horton's resignation from this court. Appellants' contention that App.R. 26(A)(1)(c) precludes a judge who was not on the original panel, but was subsequently appointed or elected to replace a panel member, from participating in the decision on an application for reconsideration is mistaken and contrary to long-standing precedent and practice. When a judge is replaced on a panel, the successor judge has the same responsibilities as his or her predecessor. Holland v. State , 27 Ohio St.2d 77, 78, 271 N.E.2d 819 (1971) ("[t]he judicial power of a member of the Court of Appeals is not personal to him [or her] and may be exercised by another member of the Court of Appeals"); see also State ex rel. Yost v. Omar Ibn El Khattab Mosque, Inc. , 156 Ohio St.3d 523, 2019-Ohio-1958, 130 N.E.3d 236 (two newly elected justices participating in decision on motion for reconsideration in place of former justices); State v. Brandon , 158 Ohio St.3d 462, 2019-Ohio-4204, 145 N.E.3d 235 (same); State v. Gonzales , 150 Ohio St.3d 276, 2017-Ohio-777, 81 N.E.3d 419 (same). Therefore, Judge Nelson, who was appointed to this court following Judge Horton's resignation, is authorized to participate in the reconsideration of Jezerinac I .

NATURE OF THE DISPUTE AND PROCEDURAL HISTORY

{¶ 9} In order to understand the substantive issues raised in the application for reconsideration and the obvious errors contained in Jezerinac I , it is necessary to identify the various parties, summarize the nature of the dispute, and set forth the procedural history of the case. "Barley's" (comprising Barley's Brewing Company and Brewcadia) is a restaurant, pub, and classic videogame arcade located at 467 North High...