Shelar v. Shelar

• Decision Date: 30 November 1995
• Docket Number: No. 3:94CV7529.,3:94CV7529.
• Citation: 910 F. Supp. 1307
• Parties: Nancy L. SHELAR, Plaintiff, v. Frederick E. SHELAR, Defendant.
• Court: U.S. District Court — Northern District of West Virginia

910 F. Supp. 1307

Nancy L. SHELAR, Plaintiff, v. Frederick E. SHELAR, Defendant.

No. 3:94CV7529.

United States District Court, N.D. Ohio, Western Division.

November 30, 1995.

COPYRIGHT MATERIAL OMITTED

Jessica Ruth Christy, Richard M. Kerger, Marshall & Melhorn, Toledo, OH, John L. Straub, Shumaker, Loop & Kendrick, Toledo, OH, for Nancy Shelar.

Andrew Kevin Ranazzi, Fuller & Henry, Toledo, OH, Martin J. Holmes, Brown, Schlageter, Craig & Shindler, Toledo, OH, for Frederick Shelar.

MEMORANDUM & ORDER

CARR, District Judge.

This is a diversity tort action between former spouses. Defendant has moved to dismiss under Fed.R.Civ.P. 12(b)(6), arguing that res judicata principles—claim and/or issue preclusion—bar this action. For the following reasons, defendant's motion shall be granted.

I. Facts

Plaintiff filed her complaint on August 19, 1994, in the Lucas County Court of Common Pleas. At the time, she and the defendant were engaged in a pending divorce proceeding in that court's Domestic Relations Division. Her complaint alleges that, "during the pendency of the divorce," defendant intentionally inflicted emotional distress by "concealing his assets, refusing to pay obligations he has previously agreed to meet, directing his counsel to breach agreements previously reached, and failing to honor financial commitments" (Complaint ¶ 2).

Defendant removed the action to this court on September 23, 1994. He based this court's jurisdiction on diversity of citizenship, 28 U.S.C. § 1332 (Doc. 1 ¶ 5).

Issues relating to distribution of marital property and spousal support were tried in the divorce proceeding on December 29, 1994 (Doc. 17, Exh. 2 at 1). In that proceeding, the parties stipulated that their marriage ended on August 25, 1992 (Doc. 25 at 3; Doc. 27 at 2). For purposes of her present complaint, plaintiff treats the 1994 trial date as the completion of her divorce. Hence she defines the phrase "pendency of the divorce" in her complaint (the time period during which defendant allegedly tortiously injured her) as August 26, 1992, through December 29, 1994 (Doc. 27 at 2).

On March 21, 1995, the divorce court filed its judgment dividing the Shelars' property and determining spousal support obligations (the equitable-division decree) (Doc. 27, Exh. 2). This judgment awarded plaintiff a portion of marital property worth $426,354, and awarded defendant a portion thereof worth $447,665 (id. at 4). It also awarded the parties equal portions of several partnerships (id.). Finally, it awarded plaintiff $3,000 per month in spousal support (id. at 4, 6). The court refused to award plaintiff any interest in two corporations, Sterling Pipe and Tube and Shelar Investments, because it saw "no evidence that the parties' assets were invested without plaintiff's knowledge and consent or that the parties' assets were dissipated" (id. at 4-5).

In a Memorandum and Order dated September 13, 1995, I asked the parties to brief issues concerning the equitable-division decree's res judicata effects on plaintiff's complaint in light of recent developments in Ohio law (Doc. 28).

II. Jurisdiction

Federal jurisdiction over plaintiff's complaint is premised on diversity of citizenship. The diversity-jurisdiction statute, 28 U.S.C. § 1332, incorporates a "domestic relations exception," which "divests the federal courts of power to issue divorce, alimony, and child custody decrees." Ankenbrandt v. Richards, 504 U.S. 689, 697-701, 703-704, 112 S.Ct. 2206, 2212-13, 2215, 119 L.Ed.2d 468 (1992). In Ankenbrandt, however, the Supreme Court held that § 1332 granted a federal district court jurisdiction over a mother's diversity action, brought on behalf of her daughters, to recover for alleged tortious sexual and physical abuse by the girls' father and his companion. Id. 504 U.S. at 706, 112 S.Ct. at 2216. Because the plaintiff in Ankenbrandt had not sought a divorce, alimony, or child custody decree, the Court stated, her complaint did not fall within the domestic relations exception. Hence the district court had jurisdiction under § 1332. Id.

The plaintiff in this case, like the plaintiff in Ankenbrandt, seeks damages for tortious conduct. She is not calling on this court to issue a divorce, alimony, or child custody decree. The diversity-of-citizenship and amount-in-controversy prerequisites of § 1332 being otherwise satisfied, this court has jurisdiction. See Strasen v. Strasen, 897 F.Supp. 1179, 1182 (E.D.Wis.1995) (court had jurisdiction over ex-wife's tort claims against ex-husband, because plaintiff did not request divorce, alimony, or child custody decree).

III. Res Judicata

To prevail on her tort claim, plaintiff must prove: (1) defendant intended to cause serious emotional harm, or knew or should have known such harm would result; (2) defendant engaged in extreme or outrageous conduct; (3) such conduct proximately caused plaintiff's injury; and (4) plaintiff suffered serious mental anguish. Ashcroft v. Mount Sinai Medical Center, 68 Ohio App.3d 359, 360, 588 N.E.2d 280 (1990). The defendant's extreme or outrageous conduct, as alleged in the complaint, was concealment of assets and refusal to comply with property-division agreements between the parties. Such conduct is alleged to have occurred during the pendency of the divorce proceeding. This lawsuit, therefore, is based on alleged mishandling of marital property prior to entry of the final decree in the divorce proceedings.

Defendant argues that these issues were actually litigated and determined in the divorce proceeding, so that the doctrine of issue preclusion bars relitigation. Alternatively, defendant argues that plaintiff's claim arises out of the same subject matter addressed by the divorce proceeding, so that the doctrine of claim preclusion bars its assertion now.

A. Ohio Res Judicata Law

Because an Ohio court issued the equitable-division decree, this court must, under the full faith and credit provisions of the Constitution and 28 U.S.C. § 1738, apply Ohio's res judicata principles. Marrese v. American Academy of Orthopaedic Surgeons, 470 U.S. 373, 105 S.Ct. 1327, 84 L.Ed.2d 274 (1985). The Supreme Court of Ohio recently adopted "the modern application of the doctrine of res judicata, as stated in 1 Restatement of the Law 2d, Judgments (1982), Sections 24-25." Grava v. Parkman Township, 73 Ohio St.3d 379, 382, 653 N.E.2d 226 (1995).¹ Consequently, "a valid, final judgment rendered upon the merits bars all subsequent actions based upon any claim arising out of the transaction or occurrence that was the subject matter of the previous action."² Id.

In Grava, the plaintiff sought a zoning certificate for a nonconforming use. Earlier, he had unsuccessfully sought a certificate for the same planned building at the same site. He had asserted then, however, that he was entitled to a variance.

The Ohio Supreme Court held that the judgment denying the first request precluded the second request. It was immaterial that Grava based the second request on a different "theory of substantive law." Id. at 383, 653 N.E.2d 226. A judgment, the court explained, bars later assertion of "all claims which ... might have been litigated" in the initial action. Id. at 382, 653 N.E.2d 226 (quoting National Amusements, Inc. v. Springdale, 53 Ohio St.3d 60, 62, 558 N.E.2d 1178 (1990)). Hence a judgment precludes claims premised on a different legal basis, including claims that "would emphasize different elements of the facts." Id. 73 Ohio St.3d at 382-83, 653 N.E.2d 226 (quoting Restatement (Second) of Judgments § 24, comm. c at 200). A plaintiff must "present every ground for relief in the first action, or be forever barred from asserting it." Id. at 382, 653 N.E.2d 226 (quoting National Amusements, 53 Ohio St.3d at 62, 558 N.E.2d 1178).

The Ohio Supreme Court's formulation of res judicata or claim preclusion in Grava overruled its contrary pronouncements in Norwood v. McDonald, 142 Ohio St. 299, 27 O.O. 240, 52 N.E.2d 67 (1943), and Whitehead v. General Telephone Co., 20 Ohio St.2d 108, 49 O.O.2d 435, 254 N.E.2d 10 Syllabus ¶ 2 (1969).³ Grava, 73 Ohio St.3d at 382, 653 N.E.2d 226. The ruling in Grava applies retrospectively, because the court did not provide otherwise in its opinion. See State ex rel. Bosch v. Industrial Commission of Ohio, 1 Ohio St.3d 94, 98, 1 O.B.R. 130, 438 N.E.2d 415 (1982).

In light of Grava, I conclude that Ohio law of issue preclusion, which involves another aspect of res judicata, see 18 C. Wright, A. Miller, E. Cooper, Federal Practice & Procedure, Jurisdiction § 4402, also would conform to the Restatement. Under the Restatement, the determination of a factual or legal issue in a judgment is conclusive in subsequent litigation if it was "actually litigated and determined," and the determination was essential to the judgment. Restatement (Second) of Judgments § 27.

B. Issue Preclusion

In the divorce action, the parties litigated and the court adjudicated issues relating to equitable division of their marital and separate property. These issues included allegations by the plaintiff of concealment and dissipation of assets during the pendency of the marriage. Adjudication of those allegations was essential to the judgment of the divorce court. Indeed, the court noted that "most of the lawyers' time in this case was spent in determining where the assets went" (Doc. 27, Exh. 2 at 7).

In its final decree, the court refused to award plaintiff any interest in two corporations, Sterling Pipe and Tube and Shelar Investments. It did so because it saw "no evidence that the parties' assets were invested without plaintiff's knowledge and consent or that the parties' assets were dissipated" (id. at 4-5).

Nonetheless, plaintiff contends that the issues she now raises were not actually litigated in the divorce court. By stipulating that the marriage ended on August 25, 1992, she argues, the parties agreed that issues concerning later conduct would not be...