William E. Weaner & Assocs., LLC v. 369 W. First St., LLC, Appellate Case No. 26792
| Decision Date | 09 December 2016 |
| Docket Number | Appellate Case No. 26792 |
| Citation | 2016 Ohio 8077 |
| Parties | WILLIAM E. WEANER & ASSOCIATES, LLC, et al. Plaintiffs-Appellees v. 369 WEST FIRST STREET, LLC, et al. Defendants-Appellants |
| Court | Ohio Court of Appeals |
(Civil Appeal from Common Pleas Court)
OPINIONCRAIG T. MATTHEWS, Atty. Reg. No. 0029215, MARK W. EVANS, Atty. Reg. No. 0084953, 320 Regency Ridge Drive, Dayton, Ohio 45459 Attorneys for Plaintiffs-Appellees
HANS H. SOLTAU, Atty. Reg. No. 0019900, 6776 Loop Road, Centerville, Ohio 45459 Attorney for Defendant-Appellant
{¶ 1} 369 West First, LLC appeals the trial court's determination that it is contractually obligated to pay reasonable attorney fees and appeals the trial court's determination of the amount of those fees. Finding no error in either determination, we affirm.
{¶ 2} In August 2008, a water leak at an office building owned by 369 West First, LLC, caused substantial damage to space leased by Dayton Head and Neck Surgeons, Inc. 369 hired William E. Weaner & Associates, d.b.a. Servpro of East Dayton/Beavercreek, to clean up the water. Servpro gave 369 an oral estimate on the cost of its services, and later the parties executed a written agreement drafted by Servpro ("Authorization to Perform Services and Direction of Payment"). The Servpro agreement contains this language regarding payment of attorney fees: "Should legal action be brought under the terms of this Contract or arise out of the performance of the Services, or should the matter be turned over for collection, Provider shall be entitled, to the fullest extent permitted under the law, to reasonable legal fees and costs of collection, in addition to any other amounts owed by Customer."
{¶ 3} 369 also hired Shooter Construction Co., d.b.a. Possert Construction Co., to make repairs on the property. 369 and Possert executed a written agreement consisting of the form provided by Possert ("Work Authorization Form"). The Possert agreement also contains an agreement to pay attorney fees: "In the event legal proceeding are instituted to recover any past due amounts, Possert is entitled to recover all costs of collection, including reasonable attorney fees."
{¶ 4} 369's insurance company ultimately denied the claims for the work done by Servpro and Possert and told both companies that they should bill 369 directly. Servpro and Possert did so but 369 refused to pay.
{¶ 5} Servpro filed a complaint against 369 and Dayton Head & Neck Surgeons in October 2009, claiming $13,939.04 for the services that it rendered plus reasonableattorney fees. Possert separately filed a complaint against the same defendants in March 2011, claiming $9,402.25 for its services plus reasonable attorney fees. The same attorney represented Servpro and Possert. The cases were consolidated, and in 2012, a joint trial was held before a magistrate. The magistrate found that 369 is liable to Servpro and Possert for the amounts they claimed plus reasonable attorney fees. 369 filed objections to the magistrate's decision in the trial court. On August 28, 2014, the trial court adopted1 the magistrate's decision, ordering 369 to pay Servpro and Possert $13,939.04 and $9,402.25, respectively, plus reasonable attorney fees, to be determined later.
{¶ 6} A hearing on attorney fees was held in May 2015. On July 8, 2015, the trial court awarded Servpro and Possert attorney fees of $60,143.25. The amount was not separated as between plaintiffs, as the trial court found that the facts of the two cases were "inextricably intertwined."
{¶ 7} 369 appealed.
{¶ 8} 369 assigns three errors to the trial court. The first two challenge the determination that Servpro and Possert are entitled to attorney fees. The third assignment of error challenges the reasonableness of the attorney-fees award.
{¶ 9} The first and second assignments of error allege that the trial court erred by determining that Servpro and Possert, respectively, are entitled to attorney fees. 369contends that the bases for the recovery of attorney fees, the contract provisions, are unenforceable.
{¶ 10} A de novo standard of review applies to a determination whether an agreement is enforceable. Taylor Bldg. Corp. of Am. v. Benfield, 117 Ohio St.3d 352, 2008-Ohio-938, 884 N.E.2d 12, ¶ 37 (arbitration agreement). But "[w]hen a trial court makes factual findings * * * supporting its determination that a contract is or is not unconscionable, such as any findings regarding the circumstances surrounding the making of the contract, those factual findings should be reviewed with great deference." (Citations omitted.) Id.at ¶ 38.
{¶ 11} 369 argues that the agreements to pay attorney fees are unenforceable because the agreements are in contracts of adhesion, because the agreements are completely one-sided, and because the agreements operate as penalties.
{¶ 12} Under freedom-of-contract principles, "[c]ontractual attorney-fee provisions have been determined to be enforceable in a number of situations." (Citations omitted.) Wilborn v. Bank One Corp., 121 Ohio St.3d 546, 2009-Ohio-306, 906 N.E.2d 396, ¶ 15, fn. 2. See also Taylor at ¶ 68 (). Generally, "[c]ontractual agreements to pay attorney fees have been upheld in commercial settings where the parties are of equal bargaining power." (Citations omitted.) Berry Network, Inc. v. United Propane Gas, Inc., 2d Dist. Montgomery No. 22875, 2009-Ohio-2537, ¶ 70. Here, the trial court implicitly found the parties to be of equal bargaining power. 369 fails to convince us otherwise. {¶ 13} 369 has not supplied us with any transcripts, saying that "the pleadings [and] the findings of the Trial Court in the Judgment Entry incorporating the findings of the Magistrate * * * are sufficient," Reply Brief, 2. Under App.R. 9(B), the appellant has the duty to provide a record sufficient for appellate review. Absent a written transcript, we cannot speculate what the testimony at the trial or attorney fee hearing was, and therefore we have a limited basis from which we can review alleged error by the trial court. In general, we are constrained to presume the regularity of the trial court's proceedings, and, particularly with respect to factual findings, we presume that the evidence before the trial court supported the trial court's judgment. Smith v. Duran, 2d Dist. Montgomery No. 20827, 2005-Ohio-4729, ¶ 14. On this record, in this commercial setting, we are not able to conclude that the parties were of unequal bargaining power.
{¶ 14} 369 argues that the agreements to pay attorney fees in this case are unenforceable because the agreements are in contracts of adhesion. "[A]greements to pay attorney fees in a 'contract of adhesion * * *' are not enforceable." Wilborn at ¶ 9, quoting Nottingdale Homeowners' Assn., Inc. v. Darby, 33 Ohio St.3d 32, 37, fn. 7, 514 N.E.2d 702 (1987). A contract of adhesion is "a standardized form contract prepared by one party, and offered to the weaker party, usually a consumer, who has no realistic choice as to the contract terms." Taylor, 117 Ohio St.3d 352, 2008-Ohio-938, 884 N.E.2d 12, at ¶ 49.
{¶ 15} The trial court determined that the Servpro contract is not a contract of adhesion. The court found that although the contract is a standardized form contract, both Servpro and 369 are sophisticated business entities. Furthermore, said the court, 369 freely chose to hire Servpro, which is not the only local provider of water extractionservices. As to the Possert contract, the trial court did not explicitly determine that it is not a contract of adhesion. But as the court noted, 369 presented the same arguments against the Possert contract. And, as with the Servpro contract, the court determined that the contract is enforceable, finding that "Possert offered to perform services for 369, in exchange for payment, and 369 accepted the proposal, both parties were capable of contracting and both assented to the contract." Decision, Order and Entry, 20 (Aug. 28, 2014).
{¶ 16} We are unable to conclude that either of the contracts are contracts of adhesion on their face, and therefore agree in the context of the record, unassisted by transcript, that neither contract here is one of adhesion.
{¶ 17} 369 also argues that the agreements to pay attorney fees are unenforceable because the agreements are completely one-sided, favoring only Servpro and Possert.
{¶ 18} The attorney-fees agreements here are one-sided to the extent that in the event of legal proceedings, 369 must pay Servpro and Possert attorney fees but neither Servpro or Possert is obligated to pay 369's attorney fees. But this does not necessarily mean that they are unenforceable. "The fact that a contractual provision is one-sided does not render it substantively unconscionable per se." Hayes v. Oakridge Home, 122 Ohio St.3d 63, 2009-Ohio-2054, 908 N.E.2d 408, ¶ 36. "[T]he obligations of the parties to a contract need not be exactly the same if the contract is supported by consideration." Taylor, 117 Ohio St.3d 352, 2008-Ohio-938, 884 N.E.2d 12, at ¶ 39, citing Taylor Bldg. Corp. of Am. v. Benfield, 168 Ohio App.3d 517, 2006-Ohio-4428, 860 N.E.2d 1058, ¶ 40 (12th Dist.) (). (Citations omitted.) Robbins v. Country Club...
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