Owens v. Haynes , 2014 Ohio 1503 ( 2014 )

[Cite as Owens v. Haynes, 2014-Ohio-1503.]
STATE OF OHIO ) IN THE COURT OF APPEALS
)ss: NINTH JUDICIAL DISTRICT
COUNTY OF SUMMIT )
CHERYL OWENS C.A. No. 27027
Appellee
v. APPEAL FROM JUDGMENT
ENTERED IN THE
PENNY HAYNES, et al. COURT OF COMMON PLEAS
COUNTY OF SUMMIT, OHIO
Appellant CASE No. CV 2013-01-0688
DECISION AND JOURNAL ENTRY
Dated: April 9, 2014
BELFANCE, Presiding Judge.
{¶1} Defendant-Appellant, Penny Haynes, appeals from the decision of the Summit
County Court of Common Pleas in favor of Plaintiff-Appellee, Cheryl Owens. This Court
affirms in part and dismisses in part.
I.
{¶2} After Ms. Owens’ husband passed away in 2006, she went to the Veteran’s
Administration office in Akron to apply for certain death benefits for his burial. Ms. Haynes, an
employee of the Veteran’s Administration office, spoke with Ms. Owens regarding her request
for benefits and ultimately submitted applications for benefits on her behalf. Ms. Owens began
receiving benefit checks at some later point in 2006.
{¶3} In 2011, the Veteran’s Administration office informed Ms. Owens that she had
received benefits to which she was not entitled, cancelled her cash benefits, and demanded that
she repay more than $34,000 in benefits. After Ms. Owens resolved the matter with the
2
Veteran’s Administration, she brought suit against Ms. Haynes and the State of Ohio. Her
complaint set forth counts of fraud, negligence, and intentional misrepresentation against Ms.
Haynes and sought to hold the State of Ohio liable as Ms. Haynes’ employer. The complaint
alleged that Ms. Haynes had disregarded Ms. Owens’ express desire to apply strictly for death
benefits and had fraudulently filed applications for additional benefits on Ms. Owens’ behalf
after having Ms. Owens sign several application forms in blank.
{¶4} Subsequently, Ms. Haynes filed a Civ.R. 12(B)(6) motion to dismiss on several
grounds, including that she was immune from suit. Ms. Owens filed a memorandum in
opposition. She also voluntarily dismissed the State of Ohio from the law suit and sought leave
to file an amended complaint. The amended complaint, which she later filed, named Summit
County as Ms. Haynes’ employer and as a defendant. The amended complaint also set forth
additional allegations regarding Ms. Haynes’ allegedly fraudulent conduct.
{¶5} On July 8, 2013, the trial court issued its decision. The court determined that
Summit County was immune from suit altogether and that Ms. Haynes was immune from suit
with regard to Ms. Owens’ claim for negligence. The court also determined, however, that Ms.
Haynes was not entitled to the benefit of immunity with regard to Ms. Owens’ claims for fraud
and intentional misrepresentation. Consequently, the court denied Ms. Haynes’ motion to
dismiss with respect to those claims.
{¶6} Ms. Haynes now appeals from the trial court’s decision and raises two
assignments of error for our review.
II.
ASSIGNMENT OF ERROR I
3
THE TRIAL COURT ERRERD (sic) TO THE PREJUDICE OF APPELLANT
BY DENYING HER MOTION TO DISMISS THE COMPLAINT FOR FRAUD
FOR FAILURE TO PLEAD WITH PARTICULARITY.
{¶7} In her first assignment of error, Ms. Haynes argues that the trial court erred by
denying the portion of her motion to dismiss that addressed Ms. Owens’ claim of fraud. Ms.
Haynes argues that the court should have dismissed the fraud count against her because Ms.
Owens failed to plead that count with particularity. Because Ms. Haynes’ first assignment of
error does not pertain to the portion of the trial court’s decision that denied her the benefit of
immunity, we are without jurisdiction to examine its merits.
{¶8} Generally, “[a]n order that denies a motion to dismiss for failure to state a claim
upon which relief can be granted is not a final order within the jurisdiction of this [C]ourt.”
Sumskis v. Medina Cty. Bd. of Mental Retardation and Dev., 9th Dist. Medina Nos. 2886-M &
2887-M, 2000 WL 141078, *1 (Feb. 2, 2000). See also McGuire v. Zarle, 9th Dist. Summit No.
26058, 2012-Ohio-2976, ¶ 7, quoting State ex rel. Keith v. McMonagle, 103 Ohio St.3d 430,
2004-Ohio-5580, ¶ 4 (“A judgment that leaves issues unresolved and contemplates that further
action must be taken is not a final appealable order.”). However, “[w]hen a trial court denies a
motion in which a political subdivision or its employee seeks immunity under R.C. Chapter
2744, that order denies the benefit of an alleged immunity and is therefore a final, appealable
order pursuant to R.C. 2744.02(C).” Hubbell v. Xenia, 115 Ohio St.3d 77, 2007-Ohio-4839,
syllabus. “Nonetheless, an appeal from such a decision is limited to the review of alleged errors
in the portion of the trial court’s decision which denied the political subdivision [or its employee]
the benefit of immunity.” Makowski v. Kohler, 9th Dist. Summit No. 25219, 2011-Ohio-2382, ¶
7. Accord McGuire v. Lorain, 9th Dist. Lorain No. 10CA009893, 2011-Ohio-3887, ¶ 3. R.C.
4
2744.02(C) does not vest this Court with jurisdiction to address other interlocutory rulings the
trial court has made. See McGuire at ¶ 2-3; Makowski at ¶ 7-8.
{¶9} In her Civ.R. 12(B)(6) motion to dismiss the complaint against her on the basis of
immunity, Ms. Haynes also argued that Ms. Owens’ fraud claim should be dismissed because
Ms. Owens failed to plead it with particularity. In its ruling on immunity, the trial court rejected
Ms. Haynes’ additional argument and concluded that Ms. Owens had sufficiently pleaded a
claim of fraud against Ms. Haynes. Ms. Haynes now argues that the trial court erred by doing so.
The court’s additional ruling on the fraud claim, however, did not deny Ms. Haynes the benefit
of immunity such that it would be immediately appealable. See Hubbell at syllabus. “Therefore,
the general rule that an appeal from the denial of a motion [to dismiss for failure to state a claim
upon which relief can be granted] is not final applies to this assignment of error.” Makowski at ¶
8. As such, we are without jurisdiction to examine the merits of Ms. Haynes’ first assignment of
error.
ASSIGNMENT OF ERROR II
THE TRIAL COURT ERRED TO THE PREJUDICE OF APPELLANT BY
DENYING IMMUNITY AFFORDED TO HER PURSUANT TO R.C.
2744.03(A)(6).
{¶10} In her second assignment of error, Ms. Haynes argues that the trial court erred by
denying her the benefit of immunity with regard to Ms. Owens’ claims of fraud and intentional
misrepresentation. We disagree.
{¶11} “The defense of immunity may be raised in a motion to dismiss pursuant to Civ.R.
12(B)(6).” Thomas v. Bauschlinger, 9th Dist. Summit No. 26485, 2013-Ohio-1164, ¶ 12. This
Court applies a de novo standard of review when reviewing a trial court’s decision on a motion
5
to dismiss. Ohio Bur. of Workers’ Comp. v. McKinley, 130 Ohio St.3d 156, 2011-Ohio-4432, ¶
12.
In reviewing a motion to dismiss, this Court must accept as true all factual
allegations in the complaint and all reasonable inferences must be drawn in favor
of the nonmoving party. To prevail on a Civ.R. 12(B)(6) motion to dismiss, it
must appear on the face of the complaint that the plaintiff cannot prove any set of
facts that would entitle [her] to recover.
(Internal quotations and citations omitted.) Spradlin v. Elyria, 9th Dist. Lorain No.
11CA010102, 2013-Ohio-1602, ¶ 4. “[I]n deciding whether it is appropriate to grant a party’s
motion to dismiss, a court may not consider any materials or evidence outside the complaint.”
Equable Ascent Fin., L.L.C. v. Ybarra, 9th Dist. Lorain Nos. 12CA010290 & 12CA010296,
2013-Ohio-4283, ¶ 13.
{¶12} “An employee of a political subdivision is immune from liability unless (1) the
employee acted outside the scope of his or her employment or official responsibilities, (2) the
employee acted with malicious purpose, in bad faith, wantonly, or recklessly, or (3) the Revised
Code expressly imposes liability on the employee.” Moss v. Lorain Cty. Bd. of Mental
Retardation, 185 Ohio App.3d 395, 2009-Ohio-6931, ¶ 21 (9th Dist.), citing R.C. 2744.03(A)(6).
Here, the trial court determined that Ms. Haynes was not entitled to dismissal of the complaint
based upon immunity because Ms. Owens’ complaint set forth sufficient allegations that Ms.
Haynes acted in bad faith or in a wanton or reckless manner. See R.C. 2744.03(A)(6)(b). Ms.
Haynes argues that the trial court erred because her “conduct in merely assisting [Ms.] Owens in
applying for benefits simply does not rise to the level of acting ‘in bad faith, [or] in a wanton or
reckless manner’ * * *.”
{¶13} “The term ‘bad faith’ embraces more than bad judgment or negligence; it is
conduct that involves a dishonest purpose, moral obliquity, conscious wrongdoing, breach of a
6
known duty through some ulterior motive or ill will partaking of the nature of fraud.” (Internal
quotations and citations omitted.) Thomas, 2013-Ohio-1164, at ¶ 22. “Wanton misconduct is
the failure to exercise any care toward those to whom a duty of care is owed in circumstances in
which there is great probability that harm will result.” Anderson v. Massillon, 134 Ohio St.3d
380, 2012-Ohio-5711, paragraph three of the syllabus. Meanwhile, “[r]eckless conduct is
characterized by the conscious disregard of or indifference to a known or obvious risk of harm to
another that is unreasonable under the circumstances and is substantially greater than negligent
conduct.” Id. at paragraph four of the syllabus.
{¶14} In her amended complaint, Ms. Owens stated that she went to the Veteran’s
Administration office strictly to apply for death benefits and that Ms. Haynes “urged her on
several different occasions” to apply for benefits she did not want. Ms. Owens stated that she
“adamantly refused” to allow Ms. Haynes to seek additional benefits on her behalf and that Ms.
Haynes told her she would not apply for those additional benefits. Nevertheless, according to the
complaint, Ms. Haynes had Ms. Owens sign several application forms in blank because she
claimed those forms were necessary to apply for burial expenses. She then allegedly completed
the forms using “false information” and filed the forms on Ms. Owens’ behalf. Ms. Owens
alleged that Ms. Haynes “filed said applications for benefits with knowledge of their falsity and
with intent to defraud [her] and in furtherance of [Ms.] Haynes’ overall scheme to increase her
work output and reach her incentives set by her employer * * *.” Ms. Owens stated that, when
the Veteran’s Administration office discovered she had received benefits for which she was
ineligible, they sought repayment and cancelled her benefit checks until she was able to prove
that she had personally not committed fraud. Ms. Owens alleged that she suffered “credit card
7
bills, loss of credit, attorney’s fees, and extreme emotional distress” as a result of Ms. Haynes’
conduct.
{¶15} Ms. Haynes criticizes Ms. Owens’ complaint on the basis that it fails to
specifically allege that Ms. Haynes acted either in bad faith or in a wanton or reckless manner.
Ms. Haynes, however, has not pointed this Court to any authority standing for the proposition
that a complaint must explicitly use the words “bad faith” or “wanton” or “reckless” in order to
trigger the immunity exception contained in R.C. 2744.03(A)(6)(b). See App.R. 16(A)(7). See
also Kelley v. Cairns & Brothers, Inc., 89 Ohio App.3d 598, 604 (9th Dist.1993). The focal
point in our analysis must be the underlying factual allegations in the complaint and all the
reasonable inferences that can be drawn from those allegations. See Spradlin, 2013-Ohio-1602,
at ¶ 4. The question, therefore, is simply whether Ms. Owens’ amended complaint set forth
sufficient factual allegations of bad faith, wanton, or reckless conduct on the part of Ms. Haynes.
{¶16} Accepting the above facts as true, see id., we must conclude that Ms. Owens’
amended complaint contains sufficient allegations that Ms. Haynes acted “in bad faith, or in a
wanton or reckless manner.” R.C. 2744.03(A)(6)(b). Contrary to Ms. Haynes’ argument on
appeal, the complaint does not accuse her of a simple mistake or allege that her conduct was
limited to simply helping Ms. Owens apply for benefits. The complaint alleges that, after she
was unable to convince Ms. Owens to apply for additional benefits, Ms. Haynes: (1) secured
signed, blank application forms from Ms. Owens by telling her the forms were necessary to
apply for burial benefits; (2) intentionally falsified those signed forms; and (3) filed them to reap
a personal employment benefit. The complaint contains sufficient allegations from which the
trier of fact could find that Ms. Haynes consciously engaged in a wrongdoing with an ulterior
motive, and thus, acted in bad faith. See Thomas, 2013-Ohio-1164, at ¶ 22. See also Aronson v.
8
Akron, 9th Dist. Summit No. 19816, 2001 WL 326875, *6 (Apr. 4, 2001); Sielaff v. Dawson, 9th
Dist. Summit No. 14725, 1991 WL 2010, *2 (Jan. 9, 1991). Further, it contains sufficient
allegations from which the trier of fact could find that Ms. Haynes either (1) failed to exercise
any care whatsoever towards Ms. Owens despite there being a great probability that financial
harm would result to her, or (2) acted with conscious disregard or indifference to an obvious risk
of financial harm to Ms. Owens. See Anderson, 134 Ohio St.3d 380, 2012-Ohio-5711, at
paragraphs three and four of the syllabus (wanton conduct and reckless conduct defined). See
also Aronson at *6; Sielaff at *2. Drawing all reasonable inferences in Ms. Owens’ favor, we
must conclude that the trial court correctly determined that Ms. Haynes was not entitled to the
benefit of immunity with regard to Ms. Owens’ claims for fraud and intentional
misrepresentation. See R.C. 2744.03(A)(6)(b). Accordingly, Ms. Haynes’ second assignment of
error is overruled.
III.
{¶17} Ms. Haynes’ first assignment of error is dismissed, as this Court lacks jurisdiction
to examine its merits. Her second assignment of error is overruled. The judgment of the Summit
County Court of Common Pleas is affirmed in part, dismissed in part, and the cause is remanded
for further proceedings consistent with the foregoing opinion.
Judgment affirmed in part,
dismissed in part,
and cause remanded.
There were reasonable grounds for this appeal.
9
We order that a special mandate issue out of this Court, directing the Court of Common
Pleas, County of Summit, State of Ohio, to carry this judgment into execution. A certified copy
of this journal entry shall constitute the mandate, pursuant to App.R. 27.
Immediately upon the filing hereof, this document shall constitute the journal entry of
judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the
period for review shall begin to run. App.R. 22(C). The Clerk of the Court of Appeals is
instructed to mail a notice of entry of this judgment to the parties and to make a notation of the
mailing in the docket, pursuant to App.R. 30.
Costs taxed to Appellant.
EVE V. BELFANCE
FOR THE COURT
HENSAL, J.
WHITMORE, J.
CONCUR
APPEARANCES:
SHERRI BEVAN WALSH, Prosecuting Attorney, and JOHN F. GALONSKI, Assistant
Prosecuting Attorney, for Appellant.
JONATHAN D. TUCKER, Attorney at Law, for Appellee.