Knighten v. Erie Islands Resort & Marina, Court of Appeals No. OT-15-040
| Decision Date | 30 September 2016 |
| Docket Number | Court of Appeals No. OT-15-040 |
| Citation | 2016 Ohio 7108 |
| Parties | Dena Knighten Appellant v. Erie Islands Resort & Marina Appellee |
| Court | Ohio Court of Appeals |
DECISION AND JUDGMENT
Jennifer J. Antonini, for appellant.
John A. Coppeler, for appellee.
{¶ 1} Plaintiff-appellant, Dena Knighten, appeals the September 3, 2015 judgment of the Ottawa County Court of Common Pleas, denying her motion for summary judgment and granting summary judgment in favor of defendant-appellee, Erie Islands Resort & Marina ("Erie Islands"). For the following reasons, we reverse the trial court judgment, in part, and affirm, in part.
{¶ 2} On October 28, 2006, Knighten entered into a contract with Erie Islands Resort & Marina to purchase an undivided 1/832 interest in real estate in an area of the resort known as Blue Heron Cove. According to the agreement, Knighten purchased "week number 3 [i.e., the third week in January], unit number 5 beginning year 2008, * * * even years." The purchase price, with closing costs, was $4,550, and the agreement also obligated Knighten to pay a maintenance fee of $660 per year. At the time the parties entered into the agreement, Unit 5 had not yet been constructed. Knighten executed a Pre-Construction Discount Addendum," which provided as follows:
I understand and acknowledge that my timeshare unit may be under construction at the time I elect to make my exchange or stay. In that event, Erie Islands Resort and Marina may substitute a two bedroom unit, until my unit is complete. I acknowledge that I received a pre-construction discount in exchange for my agreement to the above.
{¶ 3} On July 22, 2007, Knighten purchased a Platinum Club Membership for an additional $4,550. This membership granted Knighten the privilege to use the resort's recreation facilities on a day-use basis, eliminated her maintenance fee, and provided priority, discounted access to other accommodations on the resort, among other things.
{¶ 4} On June 28, 2008, Knighten executed an Erie Islands Marina View Right to Use Agreement, for an additional $2,750. Under this agreement, accommodations at Unit 3 of a marina-front building would be reserved for her annually for the sixteenth week of even-numbered years. She agreed to pay annual dues of $100. As she did when shesigned the first purchase agreement, she signed another Pre-Construction Discount Addendum because the unit had not yet been constructed.
{¶ 5} On March 10, 2014, Knighten filed a lawsuit against Erie Islands claiming that Erie Islands has failed to construct the units identified in the parties' agreements, yet continues to bill her $100 per year for maintenance fees. She also claimed that because the original unit has not been constructed, she has not received the benefits of the Platinum Club Membership that Erie Islands sold to her.
{¶ 6} Knighten's complaint alleges four causes of action: one for breach of contract for Erie Islands' failure to complete construction, and three claims for violations of the Consumer Sales Practices Act ("CSPA"). The first CSPA claim is premised on Erie Islands' failure to complete construction of Blue Heron Cove; the second for its "offer to provide plaintiff a marina view condominium"; and the third for the loss of benefits of the Platinum Club Membership Agreement resulting from its failure to complete construction. She sought damages of $12,550 as to her breach of contract claim, and triple damages plus attorney fees and costs as to each of her three CSPA claims.
{¶ 7} Erie Islands moved for summary judgment on Knighten's claims. It argued that the two pre-construction addenda signed by Knighten expressly provided that the units may be under construction and that Erie Islands may substitute a two-bedroom unit until Knighten's units were complete. It insisted that units were made available to Knighten but she cancelled reservations for the weeks of January 19-26, 2008, January 16-23, 2010, and April 17-24, 2010, and failed to show up for reservations for the weeksof January 21-28, 2012, April 21-24, 2012, January 18-25, 2014, and April 19-26, 2014. It explained that the maintenance fee of $100 per year was properly charged under the marina view addendum, and the benefits of the Platinum Club Membership were available to her all along. Erie Islands denied that the CSPA applied to Knighten's claims because the contracts involved an interest in real estate.
{¶ 8} Knighten opposed Erie Islands' motion and later filed her own motion for summary judgment. She argued that a reasonable person would have understood the initial purchase agreement to provide that her unit would be constructed by 2008. She pointed out that at his deposition, Erie Islands' president, John Gronvall, testified that the salespeople typically explain to buyers that construction will not be completed on a building until a particular percentage of sales has been made in that particular building; because that percentage had not been reached, her building was not complete and "it's quite possible that it would never get built." Knighten emphasized that the agreement indicated that no oral representations or promises had been relied on and that Erie Islands' practice of postponing construction until a certain number of sales had been made was not set forth in the parties' agreement. She insisted that the recorded deed granted her the right to occupy a specified unit.
{¶ 9} Knighten also maintained that this was not a pure real estate transaction—it was the purchase of an "intangible" right of use of the property—and that the Platinum Club Membership was an "enhanced benefit" and was not an interest in real property.
{¶ 10} The trial court granted summary judgment in favor of Erie Islands and it denied Knighten's motion for summary judgment. It characterized Knighten's agreementas a purchase of an interest in real estate and it held that the CSPA does not apply to real estate transactions. It further found Knighten's claim for breach of contract not well-taken because she executed the pre-construction addenda, whereby she acknowledged that the units were under construction and that other units may be substituted until completion of her units. In light of Knighten's execution of these addenda, it found no breach of contract.
{¶ 11} Knighten appealed the trial court's ruling, and she assigns the following errors for our review:
{¶ 12} Appellate review of a summary judgment is de novo, Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 105, 671 N.E.2d 241 (1996), employing the same standard as trial courts. Lorain Natl. Bank v. Saratoga Apts., 61 Ohio App.3d 127, 129, 572 N.E.2d 198 (9th Dist.1989). The motion may be granted only when it is demonstrated:
(1) that there is no genuine issue as to any material fact; (2) that the moving party is entitled to judgment as a matter of law; and (3) that reasonable minds can come to but one conclusion, and that conclusion is adverse to the party against whom the motion for summary judgment is made, who is entitled to have the evidence construed most strongly in his favor. Harless v. Willis Day Warehousing Co., 54 Ohio St.2d 64, 67, 375 N.E.2d 46 (1978), Civ.R. 56(C).
{¶ 13} When seeking summary judgment, a party must specifically delineate the basis upon which the motion is brought, Mitseff v. Wheeler, 38 Ohio St.3d 112, 526 N.E.2d 798 (1988), syllabus, and identify those portions of the record that demonstrate the absence of a genuine issue of material fact. Dresher v. Burt, 75 Ohio St.3d 280, 293, 662 N.E.2d 264 (1996). When a properly supported motion for summary judgment is made, an adverse party may not rest on mere allegations or denials in the pleadings, but must respond with specific facts showing that there is a genuine issue of material fact.Civ.R. 56(E); Riley v. Montgomery, 11 Ohio St.3d 75, 79, 463 N.E.2d 1246 (1984). A "material" fact is one which would affect the outcome of the suit under the applicable substantive law. Russell v. Interim Personnel, Inc., 135 Ohio App.3d 301, 304, 733 N.E.2d 1186 (6th Dist.1999); Needham v. Provident Bank, 110 Ohio App.3d 817, 826, 675 N.E.2d 514 (8th Dist.1996), citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 201 (1986).
{¶ 14} In her first assignment of error, Knighten claims that the trial court erred in its conclusion that Erie Islands did not breach its contracts with regard to the timely construction of Knighten's timeshare units. In her second assignment of error, she argues that the court improperly concluded that the agreements with Erie Islands were pure real estate transactions to which the CSPA does not apply. We address each of Knighten's assignments in turn.
{¶ 15} In her first assignment of error, Knighten contends that Erie Islands breached its agreement to build the two units identified in the initial purchase agreement and marina view...
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