Musial Offices, Ltd. v. Cuyahoga County
| Decision Date | 08 July 2021 |
| Docket Number | 108810 |
| Parties | MUSIAL OFFICES, LTD., Plaintiff-Appellee/ Cross-Appellant, v. CUYAHOGA COUNTY, ET AL., Defendants-Appellants/ Cross-Appellees. |
| Court | Ohio Court of Appeals |
Civil Appeal from the Cuyahoga County Court of Common Pleas Case No. CV-11-746704
Dworken & Bernstein Co., L.P.A., Patrick J. Perotti Nicole T. Fiorelli, and James S. Timmerberg; The Robenalt Law Firm, Inc., and Thomas D. Robenalt, for appellee.
Michael C. O'Malley, Cuyahoga County Prosecuting Attorney, and David G. Lambert, Brian R. Gutkoski, and Kenneth M. Rock, Assistant Prosecuting Attorneys, for appellants.
JOURNAL ENTRY AND OPINION
{¶ 1} Defendant-appellant/cross-appellee County of Cuyahoga ("the county") challenges the trial court's judgment entry awarding attorney fees to plaintiff-appellee/cross-appellant Musial Offices Ltd. individually and on behalf of all others similarly situated ("Musial"), following a finding that the county had engaged in frivolous conduct by filing an appeal of a motion for reconsideration. Musial cross-appealed, arguing that the award of attorney fees was insufficient. After a thorough review of the law and facts, we affirm the judgment of the trial court.
{¶ 2} This appeal presents the very narrow issue of whether the trial court erred in awarding attorney fees following its determination that a prior appeal filed by the county was frivolous. Because the underlying facts of this matter are not relevant to the resolution of the present appeal, only a short presentation of the procedural history is warranted. For a thorough recitation of the underlying facts, see Musial Offices, Ltd. v. Cty. of Cuyahoga, 2020-Ohio-5426, 163 N.E.3d 84 (8th Dist.).
{¶ 3} Musial commenced this matter by filing a class action complaint alleging claims for, inter alia, unjust enrichment, constitutional violations, injunctive relief, and writ of mandamus against the county, the county fiscal officer, Cuyahoga County Board of Revision, the county executive, and the county treasurer. In its answer, the county did not raise the defense of political subdivision immunity. The county later filed a motion to dismiss or for summary judgment that still did not raise the immunity defense. Musial amended its complaint twice, and each time the county filed a motion to dismiss pursuant to Civ.R. 12 (B) or alternatively for a more definite statement. After trial and appellate proceedings regarding class certification were resolved, the county answered Musial's second amended complaint and raised the immunity defense. Contemporaneously with its answer, the county moved for judgment on the pleadings asserting immunity.
{¶ 4} The court denied the motion for judgment on the pleadings, explicitly finding that political subdivision immunity did not apply to Musial's claims, including unjust enrichment. The court noted in its order that immunity under R.C. Chapter 2744 applies to tort actions for damages; however, Musial's complaint only alleged claims for "mandamus, injunctive relief, and equitable damages."
{¶ 5} The county then moved for leave to file a motion for summary judgment based in part on its claimed immunity, which the court denied. The case was then assigned to a different judge and leave to file a motion for summary judgment was again sought and denied.
{¶ 6} Musial's claims were tried to the court with an advisory jury, which found in favor of Musial and against the county on the unjust enrichment claim. During closing arguments and in their post-trial briefs, the county did not argue the defense of political subdivision immunity. In fact, in its arguments related to the unjust enrichment claim in the county's post-trial brief, it simply asserted that the doctrine of unjust enrichment does not apply to political subdivisions and that Musial did not meet its burden at trial on this claim.
{¶ 7} The trial court issued a judgment entry of findings of fact and conclusions of law finding in favor of Musial and the class on their claim for unjust enrichment and awarding restitution in the amount of $3, 927, 385.91. The court further noted in its entry that it was not a final order because there were issues of fact and law that had to be addressed with regard to the class.
{¶ 8} The county then filed a motion for reconsideration. Among the arguments raised in the motion was that it was immune from liability on the unjust enrichment claims. Musial opposed the motion, noting that the immunity argument had been raised in the county's prior motion for judgment on the pleadings and had been rejected by the court. The trial court denied the motion for reconsideration.
{¶ 9} While there was still no final judgment entry in the case, the county appealed the denial of the motion for reconsideration. The county noted R.C. 2744.02(C) as the authority for its appeal of an interlocutory order. Musial moved to dismiss the appeal for lack of a final appealable order, which was granted by this court. In our dismissal, we noted that the county should have appealed the trial court's denial of its motion for judgment on the pleadings or its ruling on the bench trial, both times that the county argued the immunity defense was raised. We dismissed the appeal, finding that we lacked jurisdiction due to its untimeliness.
{¶ 10} Musial subsequently moved for attorney fees, arguing that the county's appeal of a motion for reconsideration was frivolous. We remanded the matter to the trial court for consideration of this motion.
{¶ 11} On remand, the trial court construed the motion under R.C. 2323.51 and conducted an evidentiary hearing. Following the hearing, the court granted Musial's motion, specifically finding that the record demonstrated that the county was aware at the time it filed its motion for judgment on the pleadings based upon immunity under R.C. Chapter 2744 in 2015 that the denial of said motion was a final appealable order and that the county never appealed the 2015 denial of immunity. The court further found that, because the existing law was known to the county when filing its motion for judgment on the pleadings in 2015, its appeal of the motion for reconsideration in 2019 was not warranted under existing law and the filing of the appeal constituted frivolous conduct. The court awarded Musial attorney fees in the amount of $16, 142.50.
{¶ 12} The county filed an appeal of this judgment, raising two assignments of error for our review:
{¶ 13} Musial cross-appealed, asserting:
1. The trial court abused its discretion when it awarded fees less than the uncontroverted amount reflected in Class Counsel's billing records.
{¶ 14} We will begin with the county's appeal. In its first assignment of error, the county argues that the trial court erred in determining that the filing of its appeal constituted frivolous conduct under R.C. 2323.51.
{¶ 15} A motion for sanctions under R.C. 2323.51 requires a trial court to determine whether the challenged conduct constitutes frivolous conduct as defined in the statute and, if so, whether any party has been adversely affected by the frivolous conduct. Riston v. Butler, 149 Ohio App.3d 390, 777 N.E.2d 857, ¶ 17 (1st Dist.2002). R.C. 2323.51 applies an objective standard in determining frivolous conduct, as opposed to a subjective one. Bikkani v. Lee, 8th Dist. Cuyahoga No. 89312, 2008-Ohio-3130, ¶ 22. The finding of frivolous conduct under R.C. 2323.51 is determined without reference to what the individual knew or believed. Ceol v. Zion Indus., Inc., 81 Ohio App.3d 286, 289, 610 N.E.2d 1076 (9th Dist.1992).
{¶ 16} R.C. 2323.51(A)(2)(a)(ii) defines "frivolous conduct" as conduct that "is not warranted under existing law, cannot be supported by a good faith argument for an extension, modification, or reversal of existing law, or cannot be supported by a good faith argument for the establishment of new law."
{¶ 17} R.C. 2323.51 was not intended to punish mere misjudgment or tactical error. Turowski v. Johnson, 70 Ohio App.3d 118, 123, 590 N.E.2d 434 (9th Dist.1991). Instead, the statute was designed to chill egregious, overzealous, unjustifiable, and frivolous action. Turowski v. Johnson, 68 Ohio App.3d 704, 706, 589 N.E.2d 462 (9th Dist.1990). The statute serves to deter abuse of the judicial process by penalizing sanctionable conduct that occurs during litigation. Filonenko v. Smock Constr., L.L.C., 10th Dist. Franklin No. 17AP-854, 2018-Ohio-3283, ¶ 14. O18} A determination to impose sanctions under R.C. 2323.51 involves a mixed question of law and fact. Resources for Healthy Living, Inc. v. Haslinger, 6th Dist. Wood No. WD-10-073, 2011-Ohio-1978, ¶ 26. We review purely legal questions de novo. Riston, 149 Ohio App.3d 390, 2002-Ohio-2308, 777 N.E.2d 857, at ¶ 22. On factual issues, however, "we give deference to the trial court's factual determinations because the trial judge, of course, will have had the benefit of observing the entire course of proceedings and will be most familiar with the parties and attorneys involved." In re Estate of O'Toole, 8th Dist. Cuyahoga No. 108122, 2019-Ohio-4165, ¶ 30, citing Riston at ¶ 25. The ultimate decision as to whether to grant sanctions under R.C. 2323.51 rests within the sound discretion of the trial court. State ex rel Striker v. Cline, 130 Ohio St.3d 214, 2011-Ohio-5350, 957 N.E.2d 19, ¶ 11.
{¶ 19} Frivolous conduct implicated by R.C. 2323.51(A)(2)(a)(ii) involves proceeding on a legal theory that is wholly unwarranted in law....
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