ORO Capital Advisors, LLC v. Borror Constr. Co.
| Docket Number | 2:19-cv-5087,2:20-cv-4894 |
| Decision Date | 01 August 2022 |
| Parties | ORO CAPITAL ADVISORS, LLC, et al Plaintiffs, v. BORROR CONSTRUCTION CO., LLC, et al., Defendants. |
| Court | U.S. District Court — Southern District of Ohio |
Deavers Magistrate Judge
This matter is before the Court on Defendant Skyworks Equipment Rental, L.L.C.'s (“Skyworks”) Motion to Dismiss (ECF No. 142), and Oro RB SPE Owner, LLC's (“Oro RB”) Motion to Dismiss (ECF No 149).[1] For the reasons set forth below, the Court GRANTS Skyworks Motion to Dismiss (ECF No. 142) and GRANTS Oro RB's Motion to Dismiss (ECF No. 149), allowing The Carter-Jones Lumber Co. DBA Holmes Lumber Co. (“Holmes”) LEAVE TO AMEND.
Oro Capital Advisors, LLC (“Oro Capital”); Oro Karric South, LLC; Oro Karric North, LLC; Oro Silvertree, LLC; Oro Springburne, LLC; Oro RB SPE Owner, LLC (“Oro Runaway Bay” or “Oro RB”); and Oro Island Club SPE Owner (together, the “Oro Entities” or “Oro”) own and operate residential properties located in central Ohio. (ECF No. 6 ¶¶ 24-33). Oro entered into a written agreement (“Construction Agreement” or “Agreement”) with Borror Construction Co. L.L.C. (“Borror”) to renovate its various properties in central Ohio, including Runaway Bay. (ECF No. 134 ¶¶ 25-27). The essence of the underlying dispute between Oro and Borror that has spawned several lawsuits concerns Borror's alleged failure as general contractor to complete the renovations as required by the Construction Agreement. (See e.g., id. ¶ 52).
Pursuant to that Agreement, Borror hired various subcontractors to assist in its completion of the renovations, including Skyworks and Holmes. . After Skyworks and Holmes purportedly supplied materials and/or labor regarding Runaway Bay, each claimed it was never fully paid. . On October 1, 2019, Skyworks filed an Affidavit for Mechanic's Lien (“Lien”) in the Franklin County Recorder's Office. (See id. ¶ 90). As the dispute between Oro and Borror intensified, Oro filed suit in federal court.
Oro initiated this action on November 20, 2019. (ECF No. 1). As this case proceeded, the Lien filed by Skyworks was the subject of parallel litigation in state court. (See ECF No. 130 at 18) (describing Borror Construction Co., LLC v. Oro RB SPE Owner, LLC, No. 19-cv-009529 (Ct. Com. Pl.)). There, Borror filed suit against Oro RB SPE Owner, LLC (one of the several Oro entities) to foreclose the Lien and for unjust enrichment in the amount secured by the Lien.[3] See Borror Construction Co., LLC v. Oro RB SPE Owner, LLC, No. 19-cv-009529 (Ct. Com. Pl.) (ECF No. 1 ¶¶ 33-56).
On November 27, 2019, Holmes filed a three Count Complaint against Oro RB and Borror. There, Holmes asserted claims of Breach of Contract against Borror; Unjust Enrichment and for the Escrowed Funds each against Oro RB. Borror filed a Motion for Summary Judgment the following August. In response, Holmes voluntarily dismissed its breach of contract claim against Borror. Oro RB then removed this case to federal court on September 18, 2020, invoking this Court's diversity subject matter jurisdiction. (ECF No. 1, 2:20-cv-4894); see also (ECF No. 151 at 2).
Shortly thereafter in October of 2020, Oro filed its Motion for Leave to File a Consolidated Amended Pleading, to Consolidate, and to Realign Parties. (ECF No. 76). The Court GRANTED IN PART and DENIED IN PART Oro's request (ECF No. 76). (Opinion & Order, ECF No. 130). Specifically, this Court Granted Oro's request to consolidate cases (2:19-cv-5087 and 2:20-cv-4894) and to realign the parties by designating all of the Oro entities as Plaintiffs and designating the-then existing defendants in case no. 2:19-cv-5087 as Defendants. (Id.). The Court denied in part its request to file an amended pleading, allowing some claims but not others to be included in Oro's First Consolidated Complaint. (Id.). Before the Court resolved Oro's pending motion (ECF No. 76), Oro and Borror agreed to dismiss the ongoing state court action, Borror Construction Co., LLC v. Oro RB SPE Owner, LLC, No. 19-cv-009529 (Ct. Com. Pl.), in January of 2021. (See ECF No. 130 at 18). On July 20, 2021, Plaintiffs filed the First Consolidated Complaint. (ECF No. 134).
Skyworks followed with a timely Motion to Dismiss against Oro, (ECF No. 142); Oro timely filed their Response in Opposition (ECF No. 147); and Skyworks filed no Reply.
(See ECF). Oro RB similarly filed its Motion to Dismiss against Holmes, (ECF No. 149); Holmes filed a timely Response in Opposition (ECF No. 151); and Oro RB timely filed its Reply (ECF No. 154). Both Motions to Dismiss are now ripe for review.
Federal Rule of Civil Procedure 12(b)(6) provides for the dismissal of a complaint for a failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). To survive a motion to dismiss, “the plaintiff must allege facts that, if accepted as true, are sufficient to raise a right to relief above the speculative level and to state a claim to relief that is plausible on its face.” Hensley Mfg. v. ProPride, Inc., 579 F.3d 603, 609 (6th Cir. 2009) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007)) (internal quotations omitted). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. (quoting Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009)). And although the court “must accept all well-pleaded factual allegations in the complaint as true,” the court “need not accept as true a legal conclusion couched as a factual allegation.” Id. (quoting Twombly, 550 U.S. at 555) (internal quotations omitted). Finally, “[t]he defendant has the burden of showing that the plaintiff has failed to state a claim for relief.” Directv, Inc. v. Treesh, 487 F.3d 471, 476 (6th Cir. 2007); Raymond v. Avectus Healthcare Sols., LLC, 859 F.3d 381, 383 (6th Cir. 2017); Taylor v. City of Saginaw, 922 F.3d 328, 331 (6th Cir. 2019).
Defendant Skyworks moves to dismiss Oro's claims of quiet title and slander of title for failure to state a claim upon which relief can be granted. (See ECF No. 142 at 1). First, Skyworks contends that Oro's quiet title action cannot be maintained because Skyworks no longer owns the Mechanics' Lien that underlies such claim. (Id. at 5). Second, Skyworks argues that the slander of title claim fails because the statute of limitations has run. (Id. at 5-6). Additionally, Oro RB, one of the Oro entities, moves to dismiss Holmes' unjust enrichment claim for failure to state a claim. (ECF No. 149). Oro RB avers that Holmes has failed to make required allegations in connection with its unjust enrichment claim: specifically, that Borror is either unavailable for judgment or unable to pursue Oro RB for payment. (See id. at 4). The Court will address each of these arguments in turn.
Skyworks argues that Plaintiffs' quiet title claim should be dismissed. Skyworks contends that to maintain an action to quiet title, a defendant must “claim an interest” in the property subject to litigation. (ECF No. 142 at 4-5). Though Skyworks concedes that it had filed a Mechanic's Lien against Oro's property, it also notes that this Lien has since been assigned. (Id. at 5). Indeed, Skyworks observes, Oro says as much in its Complaint. (Id.). Skyworks argues that because it claims no interest in the subject property, Oro's quiet title claim as it pertains to them must be dismissed.
Oro resists this conclusion but does not dispute that Skyworks does not claim any interest in the subject property. Instead, relying primarily on Federal Rule of Procedure 19(a)(1)(A), Oro argues that its claim for quiet title against Skyworks cannot be dismissed because Skyworks is a necessary party. (See ECF No. 147 at 4) (citing Fed.R.Civ.P. 19(a)(1)(A)). Oro contends that Skyworks is necessary because it “created the cloud upon the title” by filing the Mechanic's Lien. (Id. at 5). Furthermore, Oro maintains that the fact Skyworks assigned its interest in the Mechanic's Lien to Borror “has no bearing on the need to litigate the underlying facts and allegations” that would resolve its quiet title claim. (Id.). Finally, Oro asserts that because it has no remedy at law, dismissing the claim against Skyworks would leave it with no relief at all- including the equitable relief it seeks here. (Id.).
“In Ohio, the resolution of ownership rights in real property is governed by R.C. 5303.01.” Hess Ohio Devs., LLC v. Belmont Cnty. Bd. of Revision, 2020-Ohio-4729, ¶ 44 (Ohio Ct. App. 2022). Such actions to quiet title are only available “when there is no adequate remedy at law.” WWSD, LLC v. Woods, 2022-Ohio-952, ¶ 42, 188 N.E.3d 244, 261 (Ohio Ct. App. 2022) ( that such actions are equitable in nature). Ohio Revised Code 5303.01 provides, in relevant part, “[a]n action may be brought by a person in possession of real property ... against any person who claims an interest therein adverse to him, for the purpose of determining such adverse interest..” R.C. 5303.01 (emphasis added). Thus, “[t]he purpose of any quiet-title action is to conclusively determine the allocation of property interests.” Ochsenbine v. Cadiz, 2005-Ohio-6781, ¶ 13, 166 Ohio App.3d 719, 723, 853 N.E.2d 314, 317 (citing Lincoln Health Care, Inc. v. Keck, 11th Dist. No. 2002-L-006, 2003-Ohio-4864, 2003 WL 22118380, ¶ 23).
“[A]n assignment is a transfer of property or of some right or interest from one person to another, which causes to vest in another his or...
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