Michael J. Hardesty v. Frank Corrova, 82-LW-1624

• Decision Date: 01 June 1982
• Docket Number: 82-LW-1624,81AP-1021
• Parties: Michael J. Hardesty, Plaintiff-Appellant v. Frank Corrova, Defendant-Appellee.
• Court: Ohio Court of Appeals

Michael J. Hardesty, Plaintiff-Appellant v. Frank Corrova, Defendant-Appellee.

No. 81AP-1021.

82-LW-1624 (10th)

Court of Appeals of Ohio, Tenth District Franklin.

June 1, 1982

MR DONALD F. KELCH, JR., 88 East Broad Street, Suite 1220 Columbus, Ohio 43215, For Plaintiff-Appellant.

MR. J BOYD BINNING, 592 South Third Street, Columbus, Ohio 43215, For Defendant-Appellee.

DECISION

NORRIS J.

Plaintiff appeals from a judgment of the Court of Common Pleas for Franklin County dismissing his claim for attorney fees.

Earl Sisson, Paul Schooley, and defendant met with plaintiff in February or March of 1976 to discuss the acquisition of a restaurant and bar business. Plaintiff drafted the necessary documents to incorporate the venture as CSS, Inc., and articles of incorporation were filed with the Ohio Secretary of State on April 13, 1976. In order to capitalize the business, defendant and his two companions each contributed $8,000. The business soon encountered financial difficulties, and plaintiff undertook the legal representation required to placate creditors and protect the three principals from personal liability for business indebtedness. Schooley disappeared. Ultimately, plaintiff performed legal services involved with the sale of the business.

Plaintiff rendered billings totalling in excess of $20,000, and, in his complaint filed on August 27, 1979, alleged that $11,357.82 was still due him. In the account attached to his complaint, the first billing is noted as having been rendered on April 5, 1976, and the first payment as having been received on June 30, 1976. Entries in December of 1977 reflect $600 payments from both defendant and Sisson; in February 1978, $1,500 is noted as having been received from both.

At trial, plaintiff testified that he initially sent his statements addressed to CSS, Inc., in care of Sisson, because the three principals wanted him to bill the corporation. The earliest statement which appears as a trial exhibit is dated May 7, 1976, and is addressed to the corporation, in care of Sisson. Later in 1976 statements were addressed to the corporation at the restaurant premises. In November 1977, a statement was first addressed to the three principals; thereafter, statements were addressed to either the corporation, to Sisson and defendant, to all three principals, or to defendant alone.

Plaintiff also testified that defendant had promised to pay his billings, saying "You did a good job and we'll get you paid." [Tr. 108.] Plaintiff said he "felt" he was dealing with three individuals who would pay him and that both defendant and Sisson had twice given him personal checks in partial payment of the indebtedness.

Sisson testified that, while there had been no specific agreement in the beginning concerning payment of plaintiff's fees, he assumed that they would be paid out of income from the operation of the business; that, after the business was sold in July 1978, he agreed to pay one half of the fees incurred prior to that time; that his agreement was in writing, but that defendant's name was not on the agreement; that he (Sisson) had agreed to pay any fees incurred after July 1978; and that he felt that the amount of plaintiff's fees was reasonable, especially in view of plaintiff having protected the three principals from personal liability for most of the business indebtedness.

Sisson testified as follows concerning defendant's obligation to pay plaintiff's fees:

"Q. Do you recall an agreement at any time whereby you agreed, along with Mr. Corrova and Mr. Schooley, to pay legal fees for services rendered?

"* * *

"A. At the time we completed the sale of the bar or were in negotiations for the sale of the bar, during that period of time, we both were aware of what the legal fees were and both agreed to pay.

"Q. You say we both-who does that refer to?

"A. Mr. Corrova and myself." [Tr. 10-11.]

"Q. Are you aware of any agreement that Mr. Corrova made with Mr. Hardesty in respect to the payment of fees?

"A. No.

"Q. Are you aware of any agreement between you and Mr. Corrova as to payment of these fees?

"A. No." [Tr. 23-24.]

Defendant, called by plaintiff as on cross-examination, admitted that he had been named as a defendant in some lawsuits filed by creditors of the business and that plaintiff handled the legal representation in those suits; said that he had asked plaintiff to discontinue his representation in July of 1978; and contended that personal checks that he wrote to plaintiff were intended to "reimburse" the corporation for its legal fees.

Defendant rested without offering any testimony.

Among the trial judge's findings of fact are these:

"1. Plaintiff was at all relevant times an attorney practicing in Columbus, Ohio. He incorporated a business April 13, 1976 known as C.S.S., Inc. [sic] and represented said C.S.S., Inc. during the years 1976 thru July, 1979. * * *

"* * *

"4. The Defendant personally did agree to guarantee payment to certain creditors in the event C.S.S., Inc. defaulted in payment. All such guarantees were executed in writing by the Defendant, Frank Corrova.

"5. The Defendant, Frank Corrova, did not agree to be personally liable for any debts owed by the corporation C.S.S., Inc. to the Plaintiff, Michael J. Hardesty, for legal services. There was not any written or oral agreement between Plaintiff and Defendant establishing Defendant to be personally liable for legal services Plaintiff performed for C.S.S., Inc. Plaintiff's legal services wherein Defendant was involved were all corporate related and not of a nature personal to Defendant. The Defendant never intended to be liable for attorney fees for the corporate services of C.S.S., Inc.

"* * *"

The trial judge also arrived at these conclusions of law:

"1. The defendant, Frank Corrova, was an officer and director of the corporation, C.S.S., Inc. He is not personally liable for corporate debts merely by reason of such official relationship to the corporation.

"2. A corporate officer can not be held liable for the debts of his corporation personally unless he intentionally or inadvertently binds himself as an individual. In this present case, there is no express or implied assumption of C.S.S., Inc.'s debts owing to the Plaintiff by Defendant Frank Corrova, as an individual.

"3. The burden is on the

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