Nationwide Ins. Co. v. Knott , 2012 Ohio 1351 ( 2012 )

[Cite as Nationwide Ins. Co. v. Knott, 2012-Ohio-1351.]
COURT OF APPEALS
MORGAN COUNTY, OHIO
FIFTH APPELLATE DISTRICT
NATIONWIDE INSURANCE COMPANY JUDGES:
Hon. Patricia A. Delaney, P. J.
Plaintiff-Appellee Hon. Sheila G. Farmer, J.
Hon. John W. Wise, J.
-vs-
CHARLES C. KNOTT, et al.
Defs.-3rd Party Plaintiffs-Appellants Case No. 11 AP 0004
-vs-
MARVIN KONKLE, et al.
OPINION
Third Party Defendants-Appellees
CHARACTER OF PROCEEDING: Civil Appeal from the Court of Common
Pleas, Case No. 10 CV 0080
JUDGMENT: Affirmed
DATE OF JUDGMENT ENTRY: March 29, 2012
APPEARANCES:
For Plaintiff-Appellee For 3rd Party Plaintiffs-Appellants
JASON C. HUNTER STEVEN T. SLOAN
280 North High Street, Suite 810 MOLLICA, GALL, SLOAN,
Columbus, Ohio 43215 SILLERY & MCCARTHY CO. LPA
35 North College Street
For 3rd Party Defendants-Appellees Post Office Drawer 958
Athens, Ohio 45701
RICHARD M. LEWIS
CHRISTEN N. FINLEY
JENNIFER L. ROUTTE
RICHARD M.LEWIS, LLC
295 Pearl Street, P. O. Box 664
Jackson, Ohio 45640
Morgan County, Case No. 11 AP 0004 2
Wise, J.
{¶1} Defendants-Third Party Plaintiffs/Appellants Charles C. Knott, et al. appeal
the August 17, 2011, decision of the Morgan County Court of Common Pleas granting
summary judgment in favor of Appellees Marvin and Jean Konkle.
STATEMENT OF THE CASE AND FACTS
{¶2} On or about November 27, 2006, Charles and Leslie Knott entered into an
agreement for the purchase of a farm and residence on Williams Bridge Road owned by
Marvin and Jean Konkle. Marvin Konkle, a former realtor, initially prepared a contract
which was followed by a Memorandum of Understanding.
{¶3} Prior to completion of the sale agreement, the Konkles moved out of the
house and the Knotts moved in.
{¶4} On November 24, 2008, the Konkles filed a Complaint seeking to enjoin
the Knotts from using a wood burning stove, which the Konkles alleged would create an
unreasonable hazard if connected to the chimney in the house. (Case No. 08 CV
0187).
{¶5} A fire occurred on February 19, 2009, that damaged the house which was
the subject of the agreement for sale. The fire resulted from use of the wood-burning
stove, which the Knotts had re-connected and used.
{¶6} The house burned while it was in the possession of the Knotts. Legal title,
however, was still in the name of the Konkles, who had continued to maintain an
insurance policy through Nationwide Insurance Company on the property. Nationwide
Insurance Company paid $139,321.84 to the Konkles on their insurance claim for
damages resulting from the fire.
Morgan County, Case No. 11 AP 0004 3
{¶7} On April 28, 2009, because the fire that destroyed the house rendered the
Konkles' concerns that gave rise to their request for injunctive relief moot, the Konkles
filed an Amended Complaint in Case No. 08 CV 0187.
{¶8} In their Amended Complaint, the Konkles asserted claims for the loss of
the house due to the fire. The Konkles also requested declaratory relief from the court
declaring the rights of the parties to the insurance proceeds payable by Nationwide
under the policy issued to the Konkles insuring the house at 80 Williams Bridge Rd.,
Chesterhill, Ohio.
{¶9} The Konkles and the Knotts settled their claims relating to acquisition of
title to the real estate and title was conveyed from the Konkles to the Knotts. Under the
terms of the settlement, the Knotts received a credit against the purchase price they
were to have paid the Konkles for the property in the amount paid by Nationwide for
damage to the house.
{¶10} Nationwide Insurance Company subsequently filed a subrogation
Complaint which alleged that Appellants, Charles and Lesley Knott, negligently caused
the fire at 80 Williams Bridge Road and that as a result, they should have to pay back
the $139,321.84 which Nationwide paid to the Konkles. (Case No. 10CV0080)
{¶11} The Knotts, in turn, filed a third Party Complaint against Appellees Marvin
and Jean Konkle alleging, among other things, that the Konkles negligently
misrepresented the condition of the real property at issue and that the Konkles'
misrepresentation caused or contributed to the fire at 80 Williams Bridge Road.
{¶12} On or about May 23, 2011, the Konkles moved for summary judgment on
the Knotts' Third-Party Complaint. Attached to the Konkles' Motion for Summary
Morgan County, Case No. 11 AP 0004 4
Judgment/Motion to Dismiss was a copy of a 2008 Civil Complaint filed by the Konkles
against the Knotts, which involved claims arising from the sale of the real estate from
the Konkles to the Knotts along with a request for injunctive relief to prevent the Knotts
from using the wood-burning stove with the chimney in the house. Also attached was an
Affidavit executed by Jean Konkle concerning the settlement of the claims relating to
title to the real estate and disposition of the insurance proceeds from Nationwide
Insurance Company.
{¶13} On June 14, 2011, the Knotts filed a Memorandum Contra the Konkles'
Motion for Summary Judgment/Motion to Dismiss. The Knotts' Memorandum Contra
was supported by Affidavits of Charles Knott and Lesley Knott regarding what they had
been told by Mrs. Konkle concerning a suspected problem with the chimney, their
experience with wood-burning stoves, the steps they took to have the chimney
inspected, and the conclusions of the State Fire Marshall and an investigator hired by
Appellee, Nationwide Insurance Company, that the fire which occurred on the real
property at issue had originated not in the chimney but in a cleanout located in the
basement.
{¶14} On August 17, 2011, the trial court issued a Journal Entry finding there
existed no genuine issue of material fact and granted summary judgment in favor of the
Konkles on the Knotts’ Third Party Complaint.
{¶15} Appellants now appeal, assigning the following errors for review:
ASSIGNMENTS OF ERROR
{¶16} “I. THE TRIAL COURT ERRED WHEN IT FAILED TO FIND THERE WAS
A GENUINE ISSUE OF MATERIAL FACT WHICH INCLUDED BUT WAS NOT
Morgan County, Case No. 11 AP 0004 5
LIMITED TO THE FACT THAT THE TRIAL COURT WAS PRESENTED WITH
AFFIDAVITS SETTING FORTH OPPOSING FACTS MATERIAL TO THE CASE.
{¶17} “II. THE TRIAL COURT ERRED BY FAILING TO APPLY AND/OR
PROPERLY CONSTRUE OHIO REVISED CODE §5302.30 AND RELATED
PROVISIONS REGARDING RESIDENTIAL REAL ESTATE TRANSACTIONS.”
I.
{¶18} In their first Assignment of Error, Appellants maintain the trial court erred
in granting Appellees’ motion for summary judgment. We disagree.
“Summary Judgment Standard”
{¶19} Summary judgment proceedings present the appellate court with the
unique opportunity of reviewing the evidence in the same manner as the trial court.
Smiddy v. The Wedding Party, Inc. (1987), 30 Ohio St.3d 35, 36. Civ.R. 56(C) provides,
in pertinent part:
{¶20} “Summary judgment shall be rendered forthwith if the pleadings,
depositions, answers to interrogatories, written admissions, affidavits, transcripts of
evidence in the pending case, and written stipulations of fact, if any, timely filed in the
action, show that there is no genuine issue as to any material fact and that the moving
party is entitled to judgment as a matter of law. * * * A summary judgment shall not be
rendered unless it appears from such evidence or stipulation and only therefrom, that
reasonable minds can come to but one conclusion and that conclusion is adverse to the
party against whom the motion for summary judgment is made, such party being
entitled to have the evidence or stipulation construed most strongly in his favor.”
Morgan County, Case No. 11 AP 0004 6
{¶21} Pursuant to the above rule, a trial court may not enter a summary
judgment if it appears a material fact is genuinely disputed. The party moving for
summary judgment bears the initial burden of informing the trial court of the basis for its
motion and identifying those portions of the record that demonstrate the absence of a
genuine issue of material fact. The moving party may not make a conclusory assertion
that the non-moving party has no evidence to prove its case. The moving party must
specifically point to some evidence which demonstrates the non-moving party cannot
support its claim. If the moving party satisfies this requirement, the burden shifts to the
non-moving party to set forth specific facts demonstrating there is a genuine issue of
material fact for trial. Vahila v. Hall, 77 Ohio St.3d 421, 429, 1997-Ohio-259, citing
Dresher v. Burt, 75 Ohio St.3d 280, 1996-Ohio-107.
{¶22} It is based upon this standard that we review Appellant’s Assignments of
Error.
{¶23} In their third party complaint, Appellants set forth a claim of negligence
against Appellees, claiming that the Konkles breached a duty to the Knotts by failing to
disclose defects in the home which caused or contributed to the fire. Appellants also
argued that the Konkles prevented them from obtaining insurance on the property by
failing to provide them with a deed and mortgage or a land contract as evidence of their
insurable interest in the property.
{¶24} Appellees, in support of their motion for summary judgment, argued that
they warned Appellants of the dangers of using the wood burning stove and went so far
as seeking an injunction to prevent Appellants from re-connecting the stove to the
chimney, but that Appellants used the stove anyway. Appellees further argued that
Morgan County, Case No. 11 AP 0004 7
Appellants received the full benefit of the insurance proceeds paid by Nationwide for the
fire damage, when Appellees gave them a credit for said amount against the purchase
price of the house.
{¶25} Upon review, we find that the trial court did not err in finding that no
genuine issue of material fact exists in this matter.
{¶26} We find that the record supports that Appellees in this matter did not
negligently fail to disclose the condition of the wood burning stove, instead giving
Appellants specific notice that use of the stove would create a dangerous condition and
going so far as to seek an injunction to prevent Appellants from using such stove.
{¶27} Additionally, we further find that Appellants received the benefit of
Appellees’ insurance coverage and received a credit toward the purchase price in the
amount of the insurance proceeds Appellees received from Nationwide. Appellees
were therefore not damaged by their failure to secure their own insurance on the
property.
{¶28} Appellant’s first Assignment of Error is overruled.
II.
{¶29} In their second Assignment of Error, Appellants allege that the trial court
failed to properly apply R.C. §5302.30. We disagree.
{¶30} Appellants herein argue, and Appellees do not dispute, that Appellees
were required to provide them with a residential disclosure form as prescribed in R.C.
5302.30, which provides in relevant part:
{¶31} Revised Code §5302.30, Property disclosure form for transfer of
residential real property, provides:
Morgan County, Case No. 11 AP 0004 8
{¶32} “(C) Except as provided in division (B)(2) of this section and subject to
divisions (E) and (F) of this section, every person who intends to transfer any residential
real property on or after July 1, 1993, by sale, land installment contract, lease with
option to purchase, exchange, or lease for a term of ninety-nine years and renewable
forever shall complete all applicable items in a property disclosure form prescribed
under division (D) of this section and shall deliver in accordance with division (I) of this
section a signed and dated copy of the completed form to each prospective transferee
or prospective transferee's agent as soon as is practicable.”
{¶33} A further reading of R.C. §5302.30, reveals that a remedy is provided for
failure to comply with such statute:
{¶34} “(K)(1) Except as provided in division (K)(2) of this section, but subject to
divisions (J) and (L) of this section, a transfer of residential real property that is subject
to this section shall not be invalidated because of the failure of the transferor to provide
to the transferee in accordance with division (C) of this section a completed property
disclosure form as prescribed under division (D) of this section.
{¶35} “(2) Subject to division (K)(3)(c) of this section, if a transferee of residential
real property that is subject to this section receives a property disclosure form or an
amendment of that form as described in division (G) of this section after the transferee
has entered into a transfer agreement with respect to the property, the transferee, after
receipt of the form or amendment, may rescind the transfer agreement in a written,
signed, and dated document that is delivered to the transferor or the transferor's agent
or subagent in accordance with divisions (K)(3)(a) and (b) of this section, without
incurring any legal liability to the transferor because of the rescission, including, but not
Morgan County, Case No. 11 AP 0004 9
limited to, a civil action for specific performance of the transfer agreement. Upon the
rescission of the transfer agreement, the transferee is entitled to the return of, and the
transferor shall return, any deposits made by the transferee in connection with the
proposed transfer of the residential real property.
{¶36} “(3)(a) Subject to division (K)(3)(b) of this section, a rescission of a
transfer agreement under division (K)(2) of this section only may occur if the
transferee's written, signed, and dated document of rescission is delivered to the
transferor or the transferor's agent or subagent within three business days following the
date on which the transferee or the transferee's agent receives the property disclosure
form prescribed under division (D) of this section or the amendment of that form as
described in division (G) of this section.
{¶37} “(b) A transferee may not rescind a transfer agreement under division
(K)(2) of this section unless the transferee rescinds the transfer agreement by the
earlier of the date that is thirty days after the date upon which the transferor accepted
the transferee's transfer offer or the date of the closing of the transfer of the residential
real property.
{¶38} “(c) A transferee of residential real property may waive the right of
rescission of a transfer agreement described in division (K)(2) of this section.
{¶39} “(d) A rescission of a transfer agreement is not permissible under division
(K)(2) of this section if a transferee of residential real property that is subject to this
section receives a property disclosure form as prescribed under division (D) of this
section or an amendment of that form as described in division (G) of this section prior to
the transferee's submission to the transferor or the transferor's agent or subagent of a
Morgan County, Case No. 11 AP 0004 10
transfer offer and the transferee's entry into a transfer agreement with respect to the
property.
{¶40} “(4) If a transferee of residential real property subject to this section does
not receive a property disclosure form from the transferor after the transferee has
submitted to the transferor or the transferor's agent or subagent a transfer offer and has
entered into a transfer agreement with respect to the property, the transferee may
rescind the transfer agreement in a written, signed, and dated document that is
delivered to the transferor or the transferor's agent or subagent in accordance with
division (K)(4) of this section without incurring any legal liability to the transferor
because of the rescission, including, but not limited to, a civil action for specific
performance of the transfer agreement. Upon the rescission of the transfer agreement,
the transferee is entitled to the return of, and the transferor shall return, any deposits
made by the transferee in connection with the proposed transfer of the residential real
property. A transferee may not rescind a transfer agreement under division (K)(4) of this
section unless the transferee rescinds the transfer agreement by the earlier of the date
that is thirty days after the date upon which the transferor accepted the transferee's
transfer offer or the date of the closing of the transfer of the residential real property.”
{¶41} In the instant case, there is no evidence in the record that Appellants
made any attempt to rescind the offer to purchase within 30 days of signing, instead
choosing to go forward with the purchase of the property even after the fire occurred.
{¶42} Further, while Appellees did fail to provide Appellees with a property
disclosure form, they did give Appellants specific notice of a problem with the wood
burning stove. There is no evidence that Appellees knew of or attempted to conceal the
Morgan County, Case No. 11 AP 0004 11
existence of or a problem with the cleanout. Although it would seem that if Appellees
did know of a problem with such cleanout, there would have been no reason to not
include such knowledge in their notice and motion for injunction regarding the wood
burning stove.
{¶43} Based on the foregoing, we find Appellants’ second assignment of error
not well-taken and overrule same.
{¶44} For the reasons stated in the foregoing opinion, the judgment of the Court
of Common Pleas of Morgan County, Ohio, is affirmed.
By: Wise, J.
Delaney, P. J., and
Farmer, J., concur.
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___________________________________
___________________________________
JUDGES
JWW/d 0306
Morgan County, Case No. 11 AP 0004 12
IN THE COURT OF APPEALS FOR MORGAN COUNTY, OHIO
FIFTH APPELLATE DISTRICT
NATIONWIDE INSURANCE COMPANY :
:
Plaintiff-Appellee :
:
-vs- : JUDGMENT ENTRY
:
CHARLES C. KNOTT, et al. :
:
Defendants-3rd Party Plaintiffs-Appellants : Case No. 11 AP 0004
:
-vs- :
:
MARVIN KONKLE, et al. :
:
Third Party Defendants-Appellees :
For the reasons stated in our accompanying Memorandum-Opinion, the
judgment of the Court of Common Pleas of Morgan County, Ohio, is affirmed.
Costs assessed to Appellant.
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JUDGES