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Hinerman v. Grill on Twenty First, LLC

Court of Appeals of Ohio, Fifth District, Licking

May 11, 2018

STUART HINERMAN Plaintiff-Appellee
v.
THE GRILL ON TWENTY FIRST, LLC, ET AL. Defendants-Appellants

          Appeal from the Licking County Common Pleas Court, Case No. 2015 CV 01046

          For Plaintiff-Appellee JONATHAN A. VELEY

          For Defendants-Appellants STEPHEN B. WILSON

          Hon. William B. Hoffman, P.J. Hon. Patricia A. Delaney, J. Hon. Earle E. Wise, Jr., J.

          OPINION

          HOFFMAN, P.J.

         {¶1} Appellants The Grill on Twenty First, LLC; Twenty First Street Properties, LLC; and Eric E. Mason appeal the judgment entered by the Licking County Common Pleas Court ordering a former attorney for Appellants to answer questions posed in a deposition by Appellee Stuart Hinerman.

         STATEMENT OF THE FACTS AND CASE

         {¶2} Appellee is a member in the limited liability companies The Grill on Twenty First and Twenty First Properties, Appellants in this case. Appellant Mason and Appellee agreed to go into business together operating a restaurant previously owned and operated by Appellee.

         {¶3} At the time they were discussing the new venture, Mason was represented by Attorney Adam Vernau, who was a member of the Newark law firm of Morrow, Gordon & Byrd. Mason notified Hinerman he had contacted Vernau to draft the operating agreements governing the new corporations. Hinerman was already a client of another attorney at the same law firm, and agreed to have Vernau prepare the agreements.

         {¶4} On December 20, 2006, Hinerman met with Vernau at the law firm's office and signed operating agreements with respect to both companies. The Grill on Twenty First, LLC was organized to operate the restaurant business, while Twenty First Street Properties, LLC was organized to own and manage the real estate on which the restaurant was located.

         {¶5} Appellee filed the instant case on December 7, 2015, seeking damages for breach of contract and breach of fiduciary duty, as well as an accounting from Appellants. Appellants filed a counterclaim against Appellee for breach of contract.

         {¶6} A deposition of Attorney Adam Vernau was scheduled for June 15, 2017. On the day of the deposition, Appellant Mason asserted all communications between himself and Vernau regarding the preparation of the operating agreements for the two companies were privileged. The deposition was cut short due to Appellant Mason's objections. Appellee sought a ruling from the court on the issue of whether attorney-client privilege could be invoked.

         {¶7} After an evidentiary hearing on the issue of attorney-client privilege, the court allowed the parties to supplement the record with affidavits from any person who testified at the hearing, as well as an affidavit from Vernau. The court found the joint representation exception to the attorney-client privilege was demonstrated by the evidence, and ordered Vernau to answer questions as to whether either party gave special instructions when drafting the contract regarding the division of losses from the company and the liability of Hinerman and Mason, and to answer the question as to whether he drafted any contracts which are the subject of the dispute of this case.

         {¶8} It is from this October 3, 2017 judgment Appellants prosecute ...


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