Walker v. Warren Family Funeral Homes, Inc.
| Decision Date | 19 September 2012 |
| Docket Number | A1108593 |
| Parties | HERBERT T. WALKER, HI, et al., Plaintiffs v. WARREN FAMILY FUNERAL HOMES, INC., d/b/a Newcomer Funeral Homes, et al. Defendants |
| Court | Ohio Court of Common Pleas |
Summary judgment is appropriate when there are no genuine issues of material fact that remain to be litigated and the moving party is entitled to judgment as a matter of law. Civ. R. 56(C); Cehtex Corp. v, Catrett, 477 U.S, 317 (1986), Summary judgment should be granted if the pleadings, depositions, answers to interrogatories, written admissions, affidavits, transcripts of evidence in the pending case, if any, timely filed in the action and construed most strongly in favor of the non-moving party, show that there is no genuine issue as to any material fact. Civ, R. 56(C). The burden of establishing that the material facts are not in dispute, and that no genuine issue of fact exists, is on the party moving for summary judgment. Vahila v. Hall, 77 Ohio St.3d 421, 674 N.E.2d 1164 (1997). If the moving party asserts that there is an absence of evidence to establish an essential element of the non-moving party's claim, the moving party cannot discharge this burden with a conclusory allegation, but must specifically point to some part of the record which affirmatively demonstrates this absence of evidence. Dresher v. Burt, 75 Ohio St.3d 280, 662 N.E.2d 264 (1996).
The Ohio Supreme Court has established three factors to be considered upon a motion for summary judgment. These three factors are:
(1) That there is no genuine issue as to any material fact; (2) that the moving party is entitled to judgment as a matter of law; and (3) that reasonable minds can come to but one conclusion, and that the conclusion is adverse to the party against whom the motion for summary judgment is made, who is entitled to have the evidence construed most strongly in his favor.
Bostic v. Connor, 37 Ohio St.3d 144, 146 N.E.2d 881 (1988) (quoting Harless v. Willis Day Warehousing Co., 54 Ohio St.2d 64, 375 N.E.2d 46 (1978)).
Once a motion for summary judgment has been made and supported as provided in Civ. R. 56(C), the nonmoving party then has a reciprocal burden to set forth specific evidentiary facts showing the existence of a genuine issue for trial and cannot rest on the allegations or denials in the pleadings. Wing v. Anchor Media, Ltd. Of Texas, 59 Ohio St.3d 108, 111, 570 N.E.2d 1095 (1991).
Plaintiff sold the assets of his business to Defendants. Three agreements were executed: an Asset Purchase Agreement ("APA"), a Non-Compete Agreement, and a Consulting Contract. There is no dispute that under the Non-Compete Defendants are to pay Plaintiff Walker $2, 083.33 per month for 10 years. There is no dispute that under the Consulting Contract they are to pay him $4, 166.66 per month for 5 years. Defendants stopped paying Walker under these two agreements, and he brought this action to collect. Defendants allege Walker breached the agreements and have counterclaimed against him.
The Consulting Agreement provides:
3. Services. On request, Walker shall review and inspect the business operations of Warren and advise Warren on its business operations. Walker shall expend such time and such services as the parties, in their sole discretion, deem reasonably necessary.
The undisputed evidence establishes that Walker performed each time requested by Defendants. There is no evidence that Walker breached the Consulting Agreement. Therefore, he is entitled to judgment as a matter of law on this claim.
Construing the evidence most strongly in favor of Defendants, there is some evidence from which a trier of fact could infer Walker is affiliated with a competing business, for example, Walker Funeral Stores. Thus, summary judgment is denied on this claim.
Walker seeks judgment on all Defendants' Counterclaims against him: 1) breach of contract - Asset Purchase Agreement; 2) declaratory judgment - breach of APA, Consulting Agreement and non-compete; 3) breach of duty of loyalty; 4) accounting; 5) fraud; 6) conversion; 7) alter ego; 8) civil conspiracy; and 9) cyber piracy.
As to the contract claims, for the reasons discussed previously, Walker is entitled to judgment on Defendants' claim that he breached the Consulting Agreement. Defendants have presented no evidence to support this claim. For the reasons discussed, questions of fact exist as to whether Walker breached the non-compete. Therefore he is not entitled to judgment on this claim.
Defendants also claim Walker breached the APA. Specifically, they claim he failed to transfer certain assets that he was required to transfer. In addition to real property, Walker was to transfer:
(b) Assets of Walker. All inventories for resale, supplies, prepaid expenses, furniture and equipment, vehicles, the name "Herb Walker Funeral Homes" and all variations and subdivisions of such names, website content, domain names and identifying logos, symbols or marks used exclusively in connection with the Business, and all other tangible and intangible property used or usable by said Business in the pursuit of funeral homes business, including but not by way of limitation, books and records (books and records do not include any corporate books and records of Sellers, but rather refer to those books and records relating to general business records of Walker Funeral Home, such as past funeral records), customer lists, all goodwill associated with the Business, telephone numbers and listings, contracts; all funds received for preneed agreements, preneed trust earnings and endowment care fund earnings that are not required by state law to be held in trust, but not cash or cash equivalents, or any accounts receivable related to any funeral contracts that have been fully serviced by the Business prior to the Closing.
There is some evidence from which a trier of fact could conclude Walker violated this provision. Thus, his motion for summary judgment is denied.
As for the claimed breach of duty of loyalty, Defendants seem to be alleging a breach of good faith and fair dealing. Under Ohio law a duty of good faith and fair dealing is implied in every contract. Littlejohn v. Parrish, 163 Ohio App.3d 456 (1st Dist. 2005). This duty, however, does not create a separate cause of action; rather it is part of a contract claim. Joe Ann Tabor Revocable Trust v. WDR Properties, Inc. (11th Dist. 2010) 2010 Ohio App. LEXIS 1688. Walker's motion is granted as to this claim.
As for the claim for an accounting, this is a remedy and not a separate cause of action. Walker's motion is granted as to this claim.
As for the tort claims, the Court finds that Defendants have presented some evidence to support their claims. Since questions of fact exist, Walker's motion is denied as to these.
Defendants argue that even if Walker is entitled to recover, any amount they owe him under the Consulting Agreement (or other Agreements) should be setoff against what Plain...
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