Appeal from the Court of Common Pleas, Case No. 2017 CV 00563
Plaintiff-Appellee LISA K. FERGUSON
Defendant-Appellant Montrose JOSEPH T. DATTILO
Defendant-Appellant Thompson CLAIR E. DICKINSON IRVING B.
SUGERMAN CHRISTOPHER T. TEODOSIO BROUSE MCDOWELL LPA
JUDGES: Hon. John W. Wise, P. J. Hon. W. Scott Gwin, J. Hon.
William B. Hoffman, J.
Defendants-Appellants Michael Thompson, as Trustee of the
Michael W. Thompson Living Trust, and Stars of Cleveland,
Inc., dba Montrose Ford Lincoln, appeal the September 25,
2017 judgment entry of the Stark County Court of Common
Pleas, which found enforceable a deed restriction affecting a
parcel of commercial property in Alliance, Ohio, owned by
Appellant Thompson. Plaintiff-Appellee is D & L Ferguson
LLC, the owner of an adjoining mall property. The relevant
facts leading to this appeal are as follows.
The focus of the present dispute is a 1.0-acre parcel of real
property, owned by the Michael W. Thompson Living Trust,
located at 2490 West State Street (also known as Route 62) in
Alliance, Ohio. This parcel (hereinafter the
"Thompson" property) fronts a busy commercial strip
leading to Mount Union University and downtown Alliance. Said
parcel also adjoins a larger parcel at 2500 West State
Street, better known as the Carnation Mall, an indoor retail
facility, and the parking lot for the mall. The mall itself
sits back somewhat from West State, with a McDonald's
restaurant, a Tractor Supply store, and a Kay Jewelers store
sharing the street frontage alongside the Thompson property.
Background - 2500 West State Street
Prior to 1981, Midland Service Corporation
("Midland") owned both the Thompson property (2490
West State) and the larger "mall" property upon
which Carnation Mall now stands (2500 West
State). In April 1983, R.G. Sproul and Associates,
in the name of the Alliance Mall Company, exercised an option
to purchase some of the properties in the present area of the
mall. Midland maintained a repurchase option concerning what
is now the Thompson property, as further detailed
On December 26, 1990, the Alliance Mall Company conveyed the
mall property, 2500 West State Street, to AllOhio Holding,
On February 28, 2001, AllOhio Holding, Inc. conveyed 2500
West State Street to Carnation Mall, LLC.
On April 17, 2008, Carnation Mall, LLC conveyed 2500 West
State Street to Appellee D & L Ferguson, LLC by quit
claim deed. It is thus undisputed that as to the present
property issues, Appellee D & L Ferguson is the successor
of the Alliance Mall Company.
Background - 2490 West State Street
In the meantime, in September 1983, the Alliance Mall Company
conveyed 2490 West State Street back to Midland Service
Corporation by general warranty deed.
deed contains the following restrictive covenant:
In accepting this conveyance and as part of the consideration
therefor, the Grantee, its successors and assigns, covenants
with the Grantor [the Alliance Mall Company], its successors
and assigns, that it will not use the above described
premises for any purpose other than a saving and loan branch
office and that said branch office structure shall not exceed
750 square feet. This covenant shall run with the land herein
conveyed and shall be binding on the Grantee, its successors
and assigns, unless this covenant is subsequently modified in
writing by the Grantor, its successors and assigns.
Thus, the deed restriction purports to prohibit use of
property at 2490 West State Street, for anything other than
as a branch office of a savings and loan institution.
As indicated previously, the property at 2490 West State
abuts the parking lot for Carnation Mall. There is presently
a one-story building, styled as a bank branch facility,
approximately 750 square feet in size on the property.
At some point after the above September 1983 conveyance,
Midland Service Corporation conveyed the Thompson property to
Midland Buckeye Federal Savings and Loan Bank, which later
became Sky Bank. Although the exact time frames have faded,
these entities used the Thompson property as a savings and
loan branch. Sky Bank was thereafter purchased by Huntington
In June 2000, Huntington National Bank leased the property to
the Alliance Area Development Foundation, a non-profit
organization that promotes the economic development of
Alliance. Said foundation is not a savings and loan
institution. It appears undisputed that there was never a
written modification to the aforementioned restrictive
covenant to allow the foundation to operate at the property.
In November 2013, Appellant Thompson, as trustee, purchased
the Thompson property from Huntington National Bank.
On August 11, 2014, Stars of Cleveland, Inc., seeking to
utilize the Thompson property for a retail truck lot, filed a
complaint in the Stark County Court of Common Pleas for
tortious interference of business relationships, slander of
title, and injunctive relief. The trial court subsequently
dismissed some of the claims for tortious interference with
business relationships and the claim for slander of title.
On March 30, 2015, Stars of Cleveland filed a first amended
complaint to add a claim for declaratory judgment. Stars of
Cleveland included in this claim a request for the trial
court to determine the enforceability of the restrictive
covenant, i.e., a declaration that the restrictive
covenant did not prevent it from operating a car dealership
on the property because D & L had waived the restrictive
Stars of Cleveland and D & L thereafter filed motions for
summary judgment on the claim for declaratory judgment. Stars
of Cleveland dismissed without prejudice its claim for
tortious interference with a business relationship.
On September 30, 2015, the trial court issued its decision
granting summary judgment in favor of D & L, essentially
determining that the restrictive covenant was enforceable
against Stars of Cleveland.
Stars of Cleveland then appealed. See Stars of Cleveland,
Inc. v. D & L Ferguson, LLC, 5th Dist. Stark No.
2015CA00190, 2016-Ohio-4625. On June 13, 2016, in a 2 - 1
decision, this Court reversed the grant of summary judgment
and remanded the matter to the trial court for further
proceedings. Id. at ¶ 46.
However, Stars of Cleveland and Thompson (plaintiffs in that