ESTATE OF TED J. STEPIEN, Plaintiff-Appellee,
MARY ROBINSON, et al., Defendants-Appellants.
Appeal from the Lake County Court of Common Pleas, Probate Division, Case No. 09 CV 0081. Judgment: Affirmed.
Mark A. Ziccarelli, Ziccarelli & Martello, (For Plaintiff-Appellee).
John L Reulbach, Jr., (For Defendants-Appellants).
CYNTHIA WESTCOTT RICE, J.
(¶1} Appellants, Mary Robinson, Classified USA Inc. (Ohio), and Classified USA (California), appeal the judgment of the Lake County Court of Common Pleas, Probate Division, awarding appellee, the Estate of Ted J. Stepien, attorney fees for appellants' frivolous conduct pursuant to R.C. 2323.51. At issue is whether appellants are precluded from challenging the magistrate's findings of fact due to their failure to file a transcript of proceedings before the magistrate with their objections in the trial court. For the reasons that follow, we affirm.
(¶2} In May 2009, the Estate of Ted J. Stepien, through its executrix, Teddi S. Deka, filed a complaint for declaratory judgment against appellants. The complaint sought: (1) a declaration that Classified USA Inc. (Ohio) belonged to Mr. Stepien at the time of his death and was thus an asset of the estate to be distributed pursuant to his will to his five daughters; (2) a declaration that a certain "asset purchase agreement" purporting to effectuate a purchase of Classified USA Inc. by appellant Mary Robinson, who is one of Mr. Stepien's daughters, is a forgery and invalid; and (3) an injunction to prevent Robinson from transferring or removing assets of the corporation. Appellants filed an answer, denying the material allegations of the complaint and alleging that Robinson is the sole owner of Classified USA Inc. (Ohio). The trial court referred the matter to the magistrate pursuant to Civ.R. 53.
(¶3} The matter proceeded to trial by the magistrate on August 18-19, 2011. The statement of facts that follows is derived from the magistrate's decision following the trial.
(¶4} Mr. Stepien was the owner of a company called Nationwide Cable Reps, Inc. ("NCR"). He had five daughters, including Robinson and the executrix of the estate, Teddi S. Deka. Robinson was the only daughter who played an active role in NCR. Mr. Stepien operated the business in Ohio and Robinson, a resident of California, operated the company's west coast division in that state.
(¶5} In 2006, Mr. Stepien signed and filed articles of incorporation for a new corporation, Classified USA Inc. (Ohio). Robinson and Richard Koss, Mr. Stepien's accountant, testified that Mr. Stepien intended to sell NCR's business to Classified USA Inc. (Ohio) and to transfer the new corporation to Robinson.
(¶6} Mr. Stepien allegedly signed an asset purchase agreement for the sale of NCR's assets to Robinson. Her signature is dated January 23, 2007; however, Mr. Stepien's signature is not dated.
(¶7} Koss testified, via his deposition, that he witnessed both Mr. Stepien and Robinson sign the asset purchase agreement. However, later in his deposition, Koss recanted, and said he did not witness Robinson's signature after he asked her during a break in the deposition if he had witnessed her signature.
(¶8} The magistrate found that, although Koss testified that he witnessed Mr. Stepien's signature, Koss' testimony was not credible because he originally testified he witnessed Robinson's signature and then changed his testimony after talking to her. Adding to his lack of credibility, Koss also testified on direct examination that he saw Robinson sign a promissory note for her purchase of Classified USA Inc. (Ohio). However, on cross examination, Koss testified he was guessing when he said Robinson signed the note. He testified that, in fact, he never even saw the note.
(¶9} Vickie Willard, an expert forensic document examiner, testified that the purported signature of Mr. Stepien on the asset purchase agreement is not his signature, and, in fact, is a forgery.
(¶10} The magistrate found that the signature purporting to be that of Mr. Stepien on the asset purchase agreement is a forgery and invalid to reflect a purchase of the corporation by Robinson.
(¶11} In addition, Robinson and Mr. Stepien executed a "memorandum of understanding" regarding the sale of Classified USA Inc. (Ohio) to her. The memorandum provides that NCR desires to create a new corporation, Classified USA Inc. (Ohio), and that Robinson desires to own it.
(¶12} However, the magistrate found that the memorandum of understanding included certain conditions precedent that Robinson was required to perform before the memorandum would be effective. First, the memorandum included a condition precedent pursuant to which Robinson was required to elect Mr. Stepien as president of Classified USA Inc. (Ohio). The magistrate found that Robinson did not satisfy this condition. The second condition required Robinson to ensure that, upon her death or if she could not continue the business, Classified USA Inc. (Ohio)'s stock would be transferred to Mr. Stepien. Again, the ...