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M.R. Durant Electric, LLC v. Awesome87, LLC

Court of Appeals of Ohio, Fifth District, Muskingum

June 15, 2017

M.R. DURANT ELECTRIC, LLC Plaintiff-Appellee
v.
AWESOME87, LLC, ET AL Defendants-Appellants

         Civil appeal from the Muskingum County Court of Common Pleas, Case No. CH2015-0389

          For Defendants-Appellants TUCKER ELLIS, LLP.

          For Appellee CAMM Construction SCOTT EICKELBERGER.

          JUDGES: Hon. W. Scott Gwin, P.J. Hon. John W. Wise, J. Hon. Earle E. Wise, J.

          OPINION

          GWIN, P.J.

         {¶1} Appellants appeal the October 24, 2016 and December 22, 2016 judgment entries of the Muskingum County Court of Common Pleas.

         Facts & Procedural History

         {¶2} On October 30, 2015, M.R. Durant Electric, LLC ("Durant") filed a complaint against appellant Awesome87, appellant SPG87, LLC, appellee CAMM Construction ("CAMM"), Modern Glass, Paint and Tile Co., Inc., Keybank, N.A., and the Muskingum County Treasurer, for breach of contract, unjust enrichment, quantum meruit, and foreclosure of mechanics' lien. Durant alleged it contracted with CAMM to provide certain labor and materials to property owned by Awesome87. Awesome87 owns the real property at issue and CAMM was hired as the general contractor for the project on the property. CAMM hired subcontractors Modern Glass and Durant.

         {¶3} Appellants filed answers to Durant's complaint. On January 29, 2016, CAMM filed an answer to Durant's complaint. Also contained in CAMM's answer was what CAMM called "counterclaims" against appellants for breach of contract, unjust enrichment, quantum meruit, and foreclosure of mechanics' lien.

         {¶4} On March 14, 2016, CAMM filed a motion for default judgment against appellants. The motion does not request damages and there is no affidavit attached establishing the amount of damages. On March 15, 2016, Durant filed a notice of dismissal of its case with prejudice, leaving only CAMM's claims against appellants pending.

         {¶5} Appellants filed a motion for leave to file answer instanter to appellee's cross-claims and opposition to appellee's motion for default judgment on May 17, 2016. Appellants argued appellee improperly styled its cross-claims as counterclaims. Appellants contended they should be entitled to file their answer instanter pursuant to Civil Rule 6(B) due to excusable neglect because when the January 29th document was received at the law office, it was mistakenly not forwarded to the specific attorneys on the case. Further, that their motion was appropriate since discovery had not yet begun and these cross-claims are subject to a mandatory arbitration provision in the contract between appellants and appellee. Appellants attached the affidavits of the two attorneys on the case stating they never received a copy of the improperly-styled cross-claims. Also on May 17, 2016, appellants filed a motion to stay and compel arbitration.

         {¶6} Appellee filed a memorandum contra to the motion for leave to file instanter and a memorandum contra to the motion to stay and compel arbitration. The trial court set a hearing on the motions. At the October 14, 2016 hearing, appellee argued in favor of its motion for default and appellants argued in favor of their motion for leave to file answer instanter. At the conclusion of the parties' arguments, the trial court granted the motion for default. Appellee did not present any evidence as to damages.

         {¶7} The trial court issued a judgment entry on October 24, 2016 denying appellants' motion for leave to file and granting appellee's motion for default. The trial court stated appellants' belief the claims are subject to arbitration is not excusable neglect. The trial court further noted appellants did not file their motion to compel arbitration until appellee filed its motion for default judgment. The trial court was unpersuaded by the affidavits appellants attached to their motion as the trial court found they failed to show any circumstance or explanation that would amount to excusable neglect as the cross-claim was in the file and it was ignored. The trial court granted appellee's motion for default judgment in the amount of $338, 334.86, plus interest from August 25, 2015 and found appellee has a valid lien on the premises. The trial court found the motion to stay and compel arbitration moot. Appellants filed an appeal of the trial court's denial of the motion for leave to file and the granting of the motion for default judgment.

         {¶8} While appellants' first appeal was pending, appellants filed a motion for relief from judgment pursuant to Civil Rule 60(B) and requested an oral hearing on the motion. Appellants argued the law firm uses a dual docketing system to track deadlines, the system was in place when CAMM filed its responsive pleading, and the system was inadvertently not followed when a legal secretary inadvertently failed to send an electronic copy of the pleading to the attorneys on the case. Appellants stated the response was not computed by its docketing department because it was improperly labeled a counterclaim when it should have been captioned a cross-claim. Appellants also contended if the motion for relief was granted, the case should be stayed and sent to arbitration based upon the arbitration clause contained in the contract between the parties.

         {¶9} Appellants stated they had multiple defenses to appellee's complaint, including the fact that they satisfied their obligations under the contract or were excused from doing so and that appellee was seeking damages for work not authorized under the contract. Appellants also argued the trial court erred in granting default judgment to the extent the motion challenges the amount of the award as they can demonstrate the award is significantly overstated because it includes amounts CAMM owed to its subcontractors Durant and Modern Glass, both of which filed liens directly against appellants and both of which appellants have settled and paid. Because CAMM no longer owes these subcontractors, appellants argued the trial court's granting of default judgment in the amount of $338, 334.86 results in a windfall to CAMM.

         {¶10} Appellants attached to their motion for relief an affidavit of the docket assistant who stated there are procedures in place for an internal docketing system where the docketing department reviews the document to determine whether a response is required and, if such response is required, notifies each attorney on the case. She stated the docketing department typically does not review the entire document since this is done by the attorneys. The docket assistant averred she received a copy of the pleading from the legal secretary, she did not identify a due date because it was captioned "counterclaim", and if it would have been ...


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