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Alex A. Solomon, Trustee v. Dale Harwood

October 13, 2011

ALEX A. SOLOMON, TRUSTEE PLAINTIFF-APPELLANT CROSS-APPELLEE
v.
DALE HARWOOD, ET AL. DEFENDANTS-APPELLEES AND RESOURCE TITLE AGENCY, INC. DEFENDANT-APPELLEE CROSS-APPELLANT



JUDGMENT: AFFIRMED Civil Appeal from the Cuyahoga County Court of Common Pleas Case Nos. CV-644729 and CV-664133

The opinion of the court was delivered by: Larry A. Jones, J.:

Cite as Solomon v. Harwood,

JOURNAL ENTRY AND OPINION

BEFORE: Jones, J., Blackmon, P.J., and Celebrezze, J.

{¶1} Plaintiff-appellant, Alex Solomon, Trustee, appeals the trial court's judgment in favor of defendants-appellees, Dale Harwood, Mukhless and Remah Mustafa, RBS Citizens N.A., David Horvath, and defendant-appellee cross- appellant, Resource Title Agency. For the reasons that follow, we affirm.

Procedural History and Facts

{¶2} The facts and procedural history of this case are lengthy and convoluted.*fn1

What is undisputed is that in 2003, real estate investor Dale Harwood purchased real property located at 1359 Adelaide Street in Westlake for $1.1 million. In August 2005, Harwood contracted with Solomon to sell the property for only $595,000. In October 2005, Harwood allowed Solomon to take possession of the home prior to the sale, and the parties executed a written agreement by which Solomon was to pay $1,800 per month in rent until the sale of the house could go through. The sale did not occur, however, because Harwood could not convey title free and clear. Solomon alleges he began to make improvements to the property shortly after moving in.

{¶3} In October 2006, Washington Mutual Bank, the holder of the first mortgage on the property, began foreclosure proceedings. Solomon stopped paying rent in July 2007. In September 2007, Solomon and Harwood entered into a second contract, whereby Solomon would buy the house for $575,000 through a "short sale" process that would be approved by Washington Mutual. The bank approved a short sale that contemplated a closing on or before November 3, 2007. Solomon, who at one time had enough cash to pay for the house outright, was now in need of a mortgage to finance the house. At this time, Harwood retained attorney David Horvath to represent his interests.

{¶4} Solomon was unable to obtain the necessary financing, so he and Harwood entered into another agreement, this time extending the contract 30 days, until November 30, to obtain financing for a new purchase price of $525,000. On December 6, Harwood offered to extend the financing time limit an additional 14 days if Solomon met certain conditions. On December 13, Horvath faxed a letter to Solomon's attorney, David Lynch, withdrawing the offer to sell.

{¶5} On December 14, 2007, Solomon filed a mechanic's lien against the property in the amount of $107,000. On December 17, he filed suit against the appellees, asserting various claims. He then filed two amended complaints.

Solomon's second amended complaint asserted the following claims against Harwood: specific performance (Count I), breach of contract (Count II), declaratory relief (Count III), promissory estoppel (Count IV), fraud and misrepresentation (Count V), and intentional and/or reckless infliction of emotional distress (Count XII). The complaint asserted the following claims against Harwood's attorney, David Horvath: promissory estoppel (Count IV), fraud and misrepresentation (Count V), intentional and/or reckless infliction of emotional distress (Count XII), and legal malpractice (Count XIV).

{¶6} The complaint asserted the following claims against the parties who eventually purchased the property, Mukhless and Remah Mustafa: declaratory relief (Count VI), tortious interference (Count VII), intentional and/or reckless infliction of emotional distress (Count XII). The complaint requested declaratory relief from the Mustafas's mortgage holder, RBS Citizens (Count VI), and asserted the following claims against the title agency, Resource Title: breach of contract (Count IX), negligence (Count X), and breach of fiduciary duty (Count XI).

{¶7} Solomon also set forth a claim titled "occupying claimant law" (Count XIII) asking for the fair market value of all improvements, although Solomon did not name a party to this count. Solomon further asked for a preliminary and permanent injunction against all the defendants.

{¶8} Each of the appellees answered the amended complaint. Resource Title, the Mustafas, and Harwood filed counterclaims against Solomon. A long and arduous discovery process began. The appellees individually moved for summary judgment, which the court granted, without opinion. The trial court also discharged the mechanic's lien Solomon had filed against the property and ordered him evicted from the property. The court subsequently granted the Mustafas's counterclaim for eviction and Harwood's counterclaim for breach of contract (failure to pay rent).

{¶9} Harwood, the Mustafas, and Resource Title individually moved for summary judgment on the issue of damages. The trial court subsequently awarded Harwood compensatory damages of $97,829.88, punitive damages in the amount of $75,000, and attorney fees in the amount of $56,188.98; awarded damages to the Mustafas in the amount of $90,200.83; and awarded attorney fees and expenses to Resource Title in the amount of $52,832.35.

Assignments of Error

{¶10} On appeal, Solomon raises eleven assignments of error for our review:

"I. The trial court erred in granting summary judgment to appellees where appellees Harwood, Resource Title, and Horvath have unclean hands.

"II. The trial court erred in granting summary judgment to Mustafa where Mustafa interfered with Solomon's contract and took title to the property in violation of the doctrine of lis pendens with actual notice of Solomon's interest in the property.

"III. The trial court erred in granting summary judgment to appellees where genuine issues of fact and credibility exist regarding whether Harwood had anticipatorily breached the purchase agreement, and whether Solomon had financing to purchase the property and could have closed such transaction had Harwood not breached the contract the day preceding the scheduled closing.

"IV. The trial court erred in enforcing indemnification agreement language in Resource's standard conditions of escrow where the evidence established unequivocally that Resource breached its fiduciary duty and contractual responsibilities to Solomon to assist Harwood in avoiding his contractual obligations to Solomon and/or was negligent in terminating the escrow prematurely.

"V. The trial court erred in granting summary judgment to Horvath where Solomon satisfied both the privity and malice prongs of Scholler, the question of whether malice existed was a jury issue, and Solomon provided expert testimony in support of his legal malpractice claim.

"VI. The trial court erred in granting summary judgment to [RBS] as the validity of [RBS's] mortgage deeds depends upon the erroneous summary judgment in favor of Mustafa.

"VII. The trial court erred in disregarding the application of the occupying claimant law R.C. 5303.08, to the claims of Solomon.

"VIII. The trial court erred in denying Solomon the right to a jury trial on damages.

"IX. The trial court erred in discharging Solomon's mechanic's lien.

"X. The trial court erred in awarding damages to appellees Harwood, Resource, and Mustafa, and all such awards must be vacated. Further, there was no lawful basis to render punitive damages against Solomon.

"XI. The trial court erred in failing to issue findings of fact and conclusions of law."

{¶11} Each assignment of error addresses Solomon's claims against a separate appellee or group of appellees; we will discuss the evidence relevant to each party in turn.

Standard of Review

{¶12} We review an order granting summary judgment de novo, applying the same standard the trial court used. "Pursuant to Civ.R. 56, summary judgment is appropriate when (1) there is no genuine issue of material fact, (2) the moving party is entitled to judgment as a matter of law, and (3) reasonable minds can come to but one conclusion and that conclusion is adverse to the non-moving party, said party being entitled to have the evidence construed most strongly in his favor." Zivich v. Mentor Soccer Club, Inc., 82 Ohio St.3d 367, 369, 1998-Ohio-389, 696 N.E.2d 201.

Harwood

{ΒΆ13} In the first and third assignments of error, Solomon argues that the trial court erred in granting summary judgment to Harwood. Solomon claims that there was ample evidence to show that he was ready and willing to purchase the Adelaide property ...


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