Court of Appeals of Ohio, Eighth District, Cuyahoga
L.I. DEVELOPMENT-OHIO, L.L.C., Plaintiff-Appellant,
6150 SOM CENTER ROAD, L.L.C., ET AL. Defendants-Appellees.
Appeal from the Cuyahoga County Court of Common Pleas Case
Kasputis Law Firm, L.L.C., Edward F. Kasputis, for appellant.
Charles V. Longo, Co., L.P A., Charles V. Longo, and Emily K.
Anglewicz, for appellees.
JOURNAL ENTRY AND OPINION
EILEEN KILBANE, ADMINISTRATIVE JUDGE
1} Plaintiff-appellant, L.I. Development-Ohio,
L.L.C. ("L.I. Development"), appeals the trial
court's decision granting summary judgment in favor of
defendants-appellees, George Lonjak ("Lonjak"),
Brooke DiFante ("DiFante"), and Scott Fisher
("Fisher") (collectively referred to as
"individual defendants"). For the reasons set forth
below, we affirm.
2} The instant appeal arises from a breach of lease
and unjust enrichment action filed by L.I. Development
against 6150 SOM Center Road, L.L.C. ("Tenant") and
the individual defendants. L.I. Development is the owner of
commercial property located at 6150 SOM Center Road in Solon,
Ohio. In December 2009, L.I. Development, as landlord,
entered into a five-year commercial lease agreement with
Tenant. Tenant operated a Panini's restaurant in the
rental space with the basic monthly rent payment of $15, 000.
3} Tenant signed the lease through Lonjak, as its
managing member, and Lonjak, DiFante, and Fisher signed in
their personal capacity as guarantors for the performance of
Tenant's obligations under the lease. The individual
defendants were members of and owned an equity interest in
Tenant. The original lease commenced on June 1, 2009, and
expired on May 31, 2015. On May 1, 2014, L.I. Development and
Tenant executed a five-year extension to the original lease
to commence on June 1, 2015, and expire on May 31, 2020. The
lease extension consisted of a letter addressed to L.I.
Development stating that Tenant "gives notice to
exercise its option for a period of five (5) years[.] It is
further understood that the rent for the renewal term shall
be determined per Section 21.02 of the Lease." Lonjak
was the only individual defendant whose signature appeared on
the letter. None of the individual defendants executed a
separate guaranty with respect to the extension.
4} L.I. Development alleges that on June 10, 2016,
the Tenant breached the lease by vacating the premises and
not paying rent and other payments due under the lease. L.I.
Development alleges that it has been unable to mitigate its
damages by re-renting the property.
5} L.I. Development seeks the balance of unpaid
rent, taxes, and other expenses it alleges are due through
the remainder of the renewal term in the amount of $494,
59144, with interest calculated per annum at 18 percent from
June 1, 2016, and $12, 857.25 in attorney fees.
6} The matter proceeded to arbitration, where it was
determined that the individual defendants were not liable to
L.I. Development. L.I. Development appealed the arbitration
decision. The matter then returned to the trial court's
docket where the individual defendants moved for summary
judgment. They argued that the lease guaranty applied only to
the original lease, which expired on May 31, 2015, and the
lease extension does not demonstrate any intention to bind
the individual defendants for rent payments beyond the
original lease term. L.I. Development opposed and filed its
own motion for summary judgment, which the trial court struck
7} The trial court granted summary judgment in favor
of the individual defendants. In its thorough opinion, the
The Court finds, construing the Lease, Lease Guaranty, and
Lease Renewal, that the agreements are ambiguous as to
whether the Individual Defendants guaranteed Tenant's
obligations beyond the original Lease term.
Section 21.02 of the Lease, which incorporates the Lease
Guaranty into the Lease, limits the Guaranty to "[t]his
Lease" and omits any reference to renewal. Section 21.02
is ambiguous and could reasonably be construed to limit the
Guaranty to the original Lease term. Similarly, the Lease
Guaranty does not state it includes any renewal term and
limits [L.I. Development's] recourse against the
Individual Defendants for non-payment to "this
Guaranty." Sections 1(e) and 2 of the Guaranty, which
state the Individual Defendants waive "notice of any
extensions granted," are also ambiguous as to whether
the Individual Defendants waive their consent in the future
where Tenant requests an extension or otherwise exercises an
option to renew the Lease. Further, the Lease Renewal itself
is ambiguous as it purports to exercise Tenant's option
to renew, but fails to include any personal guaranty
requirement or otherwise reference the Guaranty, and fails to
include the Individual Defendants as signatories. In
accordance with the law, the Court construes ambiguities in
the agreements as limiting the Lease Guaranty to the original
term of the Lease.
Therefore, The Court finds reasonable minds could not
conclude there existed meeting of the minds between [L.I.
Development] and the Individual Defendants sufficient to
establish guaranty contract for the Renewal term. The Court
further finds the Lease Renewal is inapplicable as to the
Individual Defendants, and that their obligations to [L.I.
Development] ended upon expiration of the original Lease, May
31, 2015. To give effect otherwise would permit construction
of the Lease and Lease Guaranty where Tenant could
unilaterally bind the Individual Defendants to extensions
without their consent. The Lease, Lease Guaranty, and Lease
Renewal failed to put the Individual Defendants on notice
that the agreements could be construed in such manner, nor
does the record demonstrate they intended such result.
8} It is from this order that L.I. Development
appeals, raising the following single ...