Robert (bob) Ramsey v. A.I.U. Ins. Co.

• Decision Date: 18 June 1985
• Docket Number: 84AP-317,85-LW-3039
• Parties: Robert (Bob) Ramsey, Plaintiff-Appellant v. A.I.U. Insurance Company, Defendant-Appellee.
• Court: Ohio Court of Appeals

Robert (Bob) Ramsey, Plaintiff-Appellant v. A.I.U. Insurance Company Defendant-Appellee.

No. 84AP-317 (REGULAR CALENDAR).

85-LW-3039 (10th)

Court of Appeals of Ohio, Tenth District Franklin.

June 18, 1985

APPEAL from the Franklin County Common Pleas Court.

MR CHARLES W. GAYTON and MR. STEVEN E. HILLMAN, for appellant.

MESSRS LANE, ALTON & HORST, MR. WILLIAM L. MILLARD, MESSRS. ROBINS, ZELLE, LARSON & KAPLAN and MR. THOMAS L. HAMLIN, for appellee.

OPINION

STRAUSBAUGH J.

Plaintiff, Robert (Bob) Ramsey, appeals from the judgment of the Franklin County Common Pleas Court denying his motion for summary judgment and granting summary judgment to defendant upon its motion.

On August 21, 1980, a fire occurred at the business premises of Dennis Seidenfeld, Automotive Wholesale Distributors, in Des Moines, Iowa. An insurance policy had been issued to Seidenfeld by defendant, A.I.U. Insurance Company, covering the premises and its contents. Under the policy plaintiff was listed as a loss-payee to the extent of the inventory which he supplied to Seidenfeld. Defendant filed a declaratory judgment action in The United States District Court for the Southern District of Iowa, Central Division, on April 13, 1981, claiming that the fire was the result of the intentional act of Seidenfeld or of someone acting under his direction and control; and as a consequence defendant was not liable under the terms of the insurance policy. Ramsey filed a counterclaim charging A.I.U. with breach of its insurance contract, bad faith in handling his claim, and intentional infliction of emotional distress.

On April 27, 1981, Ramsey filed suit in the Franklin County Common Pleas Court against A.I.U. claiming that he had complied with all requirements of his insurance policy but that defendant had refused to reimburse for his claim. Ramsey charged that A.I.U. had arbitrarily, capriciously, maliciously, intentionally and in breach of contract failed to pay him for his loss.

A.I.U. mailed a petition for removal of the case to The United States District Court for the Southern District of Ohio, Eastern Division, which was received on May 29, 1981, and also mailed a copy of the petition to opposing counsel and to the Franklin County Common Pleas Court. A.I.U. was notified by the clerk of the district court that it had failed to accompany its petition with the requisite bond necessary for removal. A.I.U. then filed its petition with the required bond on June 2, 1981 and again filed a copy with the common pleas court. However, on that same day, Ramsey filed a motion for a default judgment against A.I.U. for failure to plead or otherwise defend in the Franklin County Common Pleas Court, which was subsequently granted and judgment was entered in the amount of $629,000 in his favor. On June 17, 1981, A.I.U. filed a motion in the common pleas court to vacate the default judgment. The motion was granted on June 18, 1981 and the default judgment was set aside. Ramsey filed an appeal from the trial court's order but subsequently moved this court to withdraw his appeal. The motion was granted by this court on September 23, 1981 and plaintiff's appeal was dismissed.

On October 30, 1981, the United States District Court ordered the case remanded back to the state court denying the petition for removal because of the untimely filing of the required bond. Ramsey then filed a motion for partial summary judgment on Count I of his complaint in the Franklin County Common Pleas Court on January 6, 1982. A.I.U. responded to the motion and also requested a stay until the Iowa case had been completed. The motions were submitted to a referee for consideration, who thereafter recommended that the stay be granted and that a ruling on the motion for summary judgment be reserved until the stay was lifted. The record is void of any final order from the court adopting the referee's recommendations.

The Iowa case was bifurcated for trial and a jury trial was conducted on May 24, 1983 only on the issue of breach of contract. Both parties were present and represented by counsel, and on June 7, 1983, the jury returned a verdict in favor of Ramsey for $31,807.41. Ramsey then filed a motion on June 10, 1983 for voluntary dismissal of Count II of his counterclaim without prejudice. By order of June 13, 1983, the trial court dismissed that portion of Count II of Ramsey's counterclaim seeking recovery for intentional infliction of emotional distress with prejudice. The court's decision was based upon the findings of the jury indicating that Ramsey's inventory was highly inflated. A.I.U. then brought a motion for partial summary judgment on the issue of its breach of a duty to act in good faith in handling and processing Ramsey's claim as raised in Ramsey's counterclaim under Count II. On July 29, 1983, along with the order for judgment on the jury verdict, the court issued an order granting A.I.U.'s motion for a partial summary judgment based upon the reasoning that Iowa did not recognize a tort of bad faith in an action by an insured against his insurer.

An appeal was filed with the United States Court of Appeals for the Eighth Circuit from the judgment rendered on the jury verdict and the judgment was affirmed on May 8, 1984. No appeal was taken from the granting of the partial summary judgment or the dismissal with prejudice.

On November 4, 1983, A.I.U. filed a motion for summary judgment in the Franklin County Common Pleas Court claiming that it was entitled to judgment because plaintiff's claims were barred under the doctrine of res judicata by virtue of the judgments rendered by The United States District Court for the Southern District of Iowa, Central Division, on July 29, 1983. Exhibits were filed with the motion including copies of the judgments from the Iowa federal court. The motion was submitted to a referee along with Ramsey's previous motion for summary judgment and on December 22, 1983, the referee recommended that A.I.U.'s motion be granted and that Ramsey's motion be overruled. On February 27, 1984, the trial court ordered that defendant's motion for summary judgment be granted, plaintiff's motion for summary judgment be overruled, and that judgment be rendered in favor of A.I.U. Insurance Company. From that order plaintiff now appeals and raises the following three assignments of error:

"I. The court erred by granting the defendant's motion for summary judgment on the basis that the Iowa proceeding was res judicata to the Ohio case.

"II. The court erred in denying the plaintiff's motion for summary judgment because the defendant failed to respond with evidence allowable under Rule 56 of the Ohio Rules of Civil Procedure to rebutt [sic] the appellant's evidence submitted in support of its motion for summary judgment.

"III. The trial court erred in granting the defendant's motion for summary judgment because there already existed a valid judgment against the defendant in the sum of $629,000.00 which was granted and entered of record on June 2, 1981, constituting res judicata, and therefore, conclusive on the matter of liability and compensatory damages."

Under the doctrine of res judicata as enunciated in Norwood v. McDonald (1943), 142 Ohio St. 299, paragraph one of the syllabus:

"A final judgment or decree rendered upon the merits, without fraud or collusion, by a court of competent jurisdiction is conclusive of rights, questions and facts in issue as to the parties and their privies, and is a complete bar to any subsequent action on the same claim or cause of action between the parties or those in privity with them."

Inherent in the doctrine of res judicata is a recognition that a party should have his day in court, and thereafter the matter is concluded. Anderson v. Richards (1962), 173 Ohio St. 50. A party is bound to present his entire cause and is foreclosed from later attempting to reopen the matter as to issues which were or could have been presented in the previous action. Johnson's Island v. Bd. of Twp. Trustees (1982), 69 Ohio St. 2d 241.

In the instant case, plaintiff's claim of breach of contract was argued before a jury in the Iowa federal court with both sides present, represented by counsel and with full opportunity to present their cases. In addition, even though he was unsuccessful, plaintiff was given the opportunity to appeal the judgment. Therefore, the trial court did not err when it concluded that any subsequent action taken in the Franklin County Common Pleas Court by Ramsey, arising from a claim for breach of contract by A.I.U. under its insurance policy, was completely barred by the Iowa judgment of July 29, 1983, under the doctrine of res judicata.

Plaintiff contends that the dismissal of Count II of his counterclaim in the Iowa Federal District Court was only on his claim of intentional infliction of...