Soler v. Evans, St. Clair & Kelsey

• Decision Date: 20 March 2002
• Docket Number: No. 00-2181.,00-2181.
• Citation: 94 Ohio St.3d 432,763 NE 2d 1169
• Parties: SOLER ET AL., APPELLANTS, v. EVANS, ST. CLAIR & KELSEY ET AL., APPELLEES.
• Court: Ohio Supreme Court

94 Ohio St.3d 432

763 NE 2d 1169

SOLER ET AL., APPELLANTS, v. EVANS, ST. CLAIR & KELSEY ET AL., APPELLEES.

No. 00-2181.

Supreme Court of Ohio.

Submitted October 30, 2001.

Decided March 20, 2002.

James P. Connors, for appellant Susan A. Soler.

Vorys, Sater, Seymour & Pease, L.L.P., and Bruce L. Ingram, for appellant James P. Connors.

Fry, Waller & McCann Co., L.P.A., and Barry A. Waller, for appellee Robert B. St. Clair.

Downes & Hurst, Rufus B. Hurst and Edward S. Kim, for appellee Charles E. Kelsey.

Chester, Willcox & Saxbe, L.L.P., Karen S. Hockstad and Eugene B. Lewis, for appellees Carol King and David Bainter.

FRANCIS E. SWEENEY, SR., J.

Appellant Susan Soler, along with her mother and brother, inherited sizable real estate investments when her father died in 1982. The three family members began a partnership in 1983 that was managed by Soler's brother. In 1988, appellant began to suspect that her brother was misappropriating partnership assets, so she retained attorney Robert St. Clair, appellee, to seek an accounting and conduct an audit of the partnership. When Soler's mother died a few months later, leaving Soler's brother as the executor of the estate, Soler enlisted St. Clair and his firm to protect her interest in the estate.

Appellant soon became concerned with her attorneys' representation. Eventually, her misgivings gave way to a complete breakdown in the attorney-client relationship. In November 1995, Soler, through new counsel, appellant James Connor, brought this action alleging that St. Clair and his law firm were liable for damages resulting from their breach of contract, legal malpractice and negligence, and conversion of appellant's funds. Among the parties listed as defendants in the complaint and amended complaint were appellees St. Clair, J. Michael Evans, Charles Kelsey, Carol King, and David Bainter, all attorneys whom plaintiff believed to have been partners of the firm.¹ Soler's complaint and amended complaint contained jury demands. In his answer, St. Clair asserted a counterclaim for legal fees.

Motions for summary judgment were filed by all of the parties. The trial court granted the motions of most of the defendants, including Bainter, Kelsey, and King. Before trial, however, Soler voluntarily dismissed her case pursuant to Civ.R. 41(A). Thus, the only issue remaining was St. Clair's counterclaim for legal fees. Soler filed a motion in limine demanding a jury trial. The trial court denied the motion, finding that it was untimely. After a bench trial was held, the court granted judgment in St. Clair's favor for the exact amount requested: $47,823.72 plus interest.

Defendants St. Clair, Bainter, Kelsey, Evans, and King then filed motions for sanctions. The court found that Soler and Connors² had engaged in frivolous conduct and were jointly and severally liable for a total amount of $283,294.20 plus ten percent interest.

On appeal, the court of appeals reversed and remanded the counterclaim judgment for St. Clair. However, the court denied Soler's request for a jury trial on remand. The court of appeals also reversed and remanded the decision on the sanctions motions as to Evans, Kelsey, King, and Bainter.³ Yet, the court found that all sanctions motions were timely filed.

The court of appeals, finding its judgment to be in conflict with the Sixth Appellate District in Edinger v. DeRail, Inc. (Apr. 12, 1991), Lucas App. No. 90-158, unreported, 1991 WL 53777, and the Ninth Appellate District in Skidmore & Hall v. Rottman (1987), 38 Ohio App.3d 40, 525 N.E.2d 824, certified these matters for our review. The cause is now before the court on a certified conflict.

The first certified issue contains two parts "In an action involving multiple parties and multiple claims, must a party who has received summary judgment file a motion, pursuant to R.C. 2323.51, within twenty-one days of such summary judgment or may the party wait until twenty-one days of when the remaining claims are resolved.

"Similarly, must a party file the motion within twenty-one days of a voluntary dismissal, pursuant to Civ.R. 41(A), when a counterclaim remains pending or may the party wait until twenty-one days of when the counterclaim is resolved?"

The second certified issue asks:

"Is a general jury demand in a complaint preserved as to the issues in a counterclaim when the demand is contained in a complaint that is later dismissed pursuant to Civ.R. 41(A)?"

Both issues are separately discussed below.

I SANCTIONS MOTIONS

The first certified issue relates to the question of the timeliness of the sanctions motions filed by appellees.⁴ Specifically, we are asked to determine what the word "judgment" means as used in R.C. 2323.51, the frivolous conduct statute.

R.C. 2323.51(B) provides:

"(1) [A]t any time prior to the commencement of the trial in a civil action or within twenty-one days after the entry of judgment in a civil action * * *, the court may award court costs, reasonable attorney's fees, and other reasonable expenses incurred in connection with the civil action * * *."

In this case, Bainter was awarded summary judgment on May 4, 1998, King was awarded summary judgment on June 17, 1998, and Kelsey was awarded summary judgment on September 15, 1998. However, they did not file their sanctions motions until November 12, 1998, which was within twenty-one days of Soler's voluntary dismissal.⁵ Soler argues that, according to R.C. 2323.51(B), the motions should have been filed within twenty-one days of each defendant's receiving summary judgment. On January 12, 1999, St. Clair was awarded judgment on his counterclaim. He filed his sanctions motion within twenty-one days of the counterclaim judgment, on February 2, 1999. Similarly, Soler contends that St. Clair should have filed his motion within twenty-one days of the voluntary dismissal. Soler relies on the holding found in Edinger.

In Edinger, a malpractice case against attorney Thomas Yoder, was dismissed due to improper joinder. Approximately five months later, the remainder of the action was dismissed. Ten days after that, Yoder filed a motion pursuant to R.C. 2323.51. The trial court denied the motion, finding that it was untimely filed. The Sixth District Court of Appeals affirmed the denial, holding that Yoder should have filed his motion within twenty-one days of his dismissal or when he received notice of his dismissal. The court relied upon the language in the statute that allows a motion for sanctions to be filed before the trial begins as support for its decision. The court further stated:

"Preventing a party from filing a motion pursuant to R.C. 2323.51 until all the claims in a complex action were determined would defeat the purpose of that statute. * * * [T]he plain language of the statute discloses a purpose to prevent abuse of process during the course of litigation by providing a means for immediate judicial determination and sanctioning of such abuse. Precluding any action by an aggrieved party at the time of the alleged abuse would greatly reduce its power to deter such conduct thereby circumventing that purpose. Limiting the time for the motion to twenty-one days after judgment is similar to a statute of limitations or the time constrictions set for many other types of motions and is included to bar stale or retaliatory claims."

In rejecting the Edinger court's analysis, the appellate court in the instant case agreed with the Seventh District Court of Appeals in Olivito v. Cavanaugh (Dec. 30, 1992), Jefferson App. Nos. 90-J-33 and 90-J-39, unreported, 1992 WL 398435, which found Edinger's holding too restrictive. Olivito recognized that one of the primary purposes of the statute is to inhibit frivolous conduct during the discovery process. Thus, Olivito found that the statutory language supports the conclusion that a party is not required to wait until the end of the litigation to file a motion for sanctions. However, Olivito found that it is not necessary that the moving party always file the motion within twenty-one days of the entry of any judgment that could pertain to frivolous conduct. Instead, Olivito believed that the statutory language gives the moving party some discretion in deciding when to file the motion. Thus, Olivito found that the statute permits the moving party to file the motion at any time prior to the start of the trial or within twenty-one days after the entry of judgment, but that the term "judgment" should be interpreted as being synonymous with the term "final order" as defined in R.C. 2505.02 (i.e., "[a]n order that affects a substantial right in an action that in effect determines the action and prevents a judgment").

Olivito explained "Since the first part of the conjunctive phrase [in the statute] refers to the entire period prior to trial, it follows that the only judgment to which the latter part refers is that which is rendered after the trial. * * *

"[W]e believe that public policy supports the foregoing conclusion. The Edinger holding places the onus upon a movant to file a motion for sanctions while the action is still pending. If the movant is still a party to the action, this places an additional burden upon the very party who has allegedly been subject to the frivolous conduct. Since the statute was meant to assist that party, he should have the option of deciding whether to bring the motion during the action or after its conclusion." (Emphasis sic.)

We agree with the reasoning espoused in Olivito. The plain meaning of the statute provides a means for an immediate judicial determination and a speedy sanctioning of such abuse. However, the aggrieved party also has the option of waiting until the conclusion of the action to seek sanctions. Construing the word "judgment" as used in the statute to mean a final appealable order serves the remedial purpose of the statute. By enacting R.C. 2323.51, the General Assembly sought to provide a remedy for those harmed by...