When Does A Plaintiff Have A Right To A Jury Trial Under The CSPA? – Financial Services

Ohio

Fraudulent Transfer Act

Allan v. Allan,  8th Dist. Cuyahoga Nos.
110177, 110179, 2022-Ohio-1488

In this appeal, the Eighth Appellate District reversed the trial
court’s decision under the Fraudulent Transfer Act case to
the extent it was based upon the grounds that the statute of
limitations expired under R.C. 1336.09 because there was disputed
evidence as to whether, and when, the transfers of the gas stations
were made and, if so, when those transfers were perfected.

The Bullet Point: At issue in this case
was the date of transfer of two businesses under the statute of
limitations of Ohio’s Fraudulent Transfer Act. R.C. 1336.09
provides that a lawsuit under Ohio’s Fraudulent Transfer Act
must be brought within four years. As such, at issue in determining
whether or not plaintiff’s suit was brought within the
four-year statute of limitations was whether the businesses were
transferred for purposes of the Ohio Fraudulent Transfer Act and,
if so transferred, when those transfers occurred. Under the Ohio
Fraudulent Transfer Act, a transfer is defined as “every
direct or indirect, absolute or conditional, and voluntary or
involuntary method of disposing of or parting with an asset or an
interest in an asset, and includes payment of money, release,
lease, and creation of a lien or other encumbrance.” R.C.
1336.01(L). In determining whether a transfer is made under the
Fraudulent Transfer Act, R.C. 1336.06 provides that for transfers
of fixtures and assets constituting personalty, the cause of action
arises on the date of perfection against a judicial lien creditor
not asserting rights under the Act. Perfection typically is
effected by notice-filing, recordation, or delivery of unequivocal
possession. If applicable law permits the transfer to be perfected
and the transfer is not perfected before commencement of an action
for relief, the transfer is deemed made immediately before the
commencement of the action.

Intervention

Grande Voiture D’Ohio La Societe des 40 Hommes
et 8 Chevaux v. Simpson, 2d Dist. Montgomery No. 29330,
2022-Ohio-1422

In this appeal, the Second Appellate District affirmed the trial
court’s decision denying the corporation’s motion to
intervene under Civ.R. 24(A) because it was not a necessary party
to the foreclosure action.

The Bullet Point: At issue in this dispute
was whether a third party entity was a necessary party to a
foreclosure action. Civ.R. 24(A), which governs interventions of
right, states: “Upon timely application anyone shall be
permitted to intervene in an action: (1) when a statute of this
state confers an unconditional right to intervene; or (2) when the
applicant claims an interest relating to the property or
transaction that is the subject of the action and the applicant is
so situated that the disposition of the action may as a practical
matter impair or impede the applicant’s ability to protect
that interest, unless the applicant’s interest is adequately
represented by existing parties.” Simply stated, anyone who
claims an interest relating to the subject matter of a lawsuit may
file a motion to intervene in said suit under Civ.R. 24(A) if the
result of said suit would harm the party’s ability to protect
its interest.

As noted by the appellate court, Civ.R. 24(A) is to be liberally
construed so as to permit intervention. That being said, the
appellate court agreed with the trial court that the entity was not
a necessary party to the instant foreclosure action. “The
only parties necessary to an action in foreclosure are those who
have any title, right, or interest in the subject of the real
estate.” Defendant did not claim, and the record did not
show, that the entity had an interest in the property at issue.
Moreover, the entity’s inability to intervene would not
“impair or impede” its “ability to protect”
any interest it may have in indemnifying defendant. To the extent
the entity agreed to or was legally required to indemnify
defendant, it remained able to do so despite the denial of its
motion to intervene. Consequently, the entity was not a necessary
party and the motion to intervene was properly denied.

Acceptance of Goods

Digitalight Sys. v. Cleveland Clinic Found.,
8th Dist. Cuyahoga No. 110723, 2022-Ohio-1400

In this appeal, the Eighth Appellate District affirmed the trial
court’s decision, agreeing that Cleveland Clinic did not
accept the shipment of KN95 masks pursuant to R.C. 1302.64(A)(1)
and cancelled its purchase order following Digitalight’s
failure to perform under the contract.

The Bullet Point: Pursuant to R.C.
1302.64(A)(1), “Acceptance of goods occurs when the buyer:
(1) after a reasonable opportunity to inspect the goods signifies
to the seller that the goods are conforming or that he will take or
retain them in spite of their non-conformity.” Cleveland
Clinic acknowledged its loading dock clerk took possession of the
second shipment of 85,000 masks but that said shipment was
delivered by an unknown carrier and dropped off with the carrier
leaving before Cleveland Clinic could inspect and reject the
shipment. Further, it took possession of said second shipment after
1) cancelling the purchase order, 2) instructing Digitalight not to
ship the masks, and 3) advising Digitalight that Cleveland Clinic
would not be paying for the masks if they were shipped.

As the appellate court explained, Cleveland Clinic’s
taking of physical possession of the second shipment was not an
acceptance of said shipment. On the contrary, Cleveland Clinic
cancelled the purchase order before the masks were shipped and
rejected the masks before they were delivered. It took
possession of the second shipment without having an opportunity to
inspect the contents of the shipment. Finally, after discovering
the contents of the shipment that Cleveland Clinic took possession
of, Cleveland Clinic rejected the shipment and invited Digitalight
to retrieve the masks from Cleveland Clinic’s warehouse at
any time. Accordingly, Cleveland Clinic did not
“accept” the second shipment of masks pursuant to R.C.
1302.64(A)(1) and instead cancelled the order following
Digitalight’s failure to perform under the contract.

Jury trial under the CSPA

Sharp v. M3C Invests. LLC, 8th Dist. Cuyahoga
No. 110442, 2022-Ohio-1394

In this appeal, the Eighth Appellate District reversed the trial
court’s decision and remanded the case, finding that the
plaintiff had a right to a jury trial on the issue of damages in
her Ohio Consumer Sales Practices Act (CSPA) claim.

The Bullet Point:  The eighth appellate
district previously considered a party’s right to a jury
trial on damages in the context of a default judgment. In
consideration of that right, this court noted that Civ.R. 55(A),
which governs the entry of default judgment and the necessity of a
hearing on damages, gives the trial court the discretion to conduct
a hearing following an entry of default judgment in order to
determine the measure of damages. However, this discretion under
Civ.R. 55(A) is tempered with a party’s constitutional and
substantial right to a jury trial. Ohio’s Constitution
provides that “[t]he right to a trial by jury shall be
inviolate * * *.” Section 5, Article I, Ohio Constitution;
Civ.R. 38(A). Under long-standing Ohio law, “[C]ourts have
determined that the language of Civ.R. 55(A) — “the
court * * * shall when applicable accord a right of trial by jury
to the parties” — mandates the right to a jury trial.
Nevertheless, this constitutional guarantee is limited by certain
procedural rules in that a party must take affirmative action to
invoke the right to a jury trial. Under Civ.R. 38(B), any party may
demand a trial by jury on any issue triable of right by a jury by
serving upon the other parties a demand therefore at any time after
the commencement of the action. Once a jury demand has been made by
any party, it cannot be withdrawn without the consent of all
parties, and the trial must be by jury, even in the case of a trial
on the issues of damages following the entry of a default judgment
as to liability.

In this case, plaintiff alleged CSPA violations, where the
resultant damages were all “triable issues.” Plaintiff
demanded a jury trial in her complaint, renewed that demand in her
motion for default judgment, and never abandoned her demand. The
appellate court also noted that although no defendant appeared in
the action, the Civil Rules explicitly mandate that once a jury
demand is made by one party, it may not be withdrawn without the
consent of all parties, regardless of the fact that default
judgment has been entered. Accordingly, the trial court erred in
denying plaintiff’s request for a jury trial on the issue…