Edelsten v. Mawardi
Edelsten v. Mawardi
Opinion of the Court
Appellees Rafael Mawardi,' Isaac Ma-wardi, and Limor Mawardi filed a lawsuit against appellants Geoffery W. Edelsten, Altéis Management USA, LLC (a Florida limited liability company), and its wholly-owned subsidiary Barrington Spring House, LLC (an Ohio limited liability company) and numerous other corporations in connection with various business transactions and investments, including an apartment complex located in Dayton, Ohio. During the course of the litigation, the trial court entered an order granting ap-pellees’ Emergency Motion for Appointment of Receiver regarding this Ohio property. For the reasons set forth below, we hold that the trial court lacked the authority to appoint a Florida resident as a receiver over Ohio real estate owned by an Ohio corporation.
In section II of the subject order under review, the trial court appointed the Florida receiver over Altéis for the express “purpose of maintaining the status quo and insuring the real estate owned in Dayton, OH is not further encumbered, and insuring that the financial needs for continued operation of the apartment complex are met to the extent possible from the rental receipts and from the sale of receiver certificates.” The order made no express finding about the ownership of the Ohio real estate, instead stating only that: “Defendants, ALTELS MANAGEMENT, LLC, a Florida LLC, and/or BARRING-TON SPRING HOUSE, LLC, an Ohio LLC, own property known as the River-view Park Apartments located in Dayton, OH.”
The record reflects that the recorded deed, as well as the note and mortgage on the property, show that the apartments are owned by Barrington Spring House, LLC.
Here, the trial court clearly intended to take control over the parent company (Al-
The trial court’s appointment of the Florida resident receiver to oversee an Ohio corporation, and its Ohio real estate, also runs contrary to Ohio law, which expressly provides:
No party, attorney, or person interested in an action shall be appointed receiver therein except by consent of the parties. No person except a resident of this state shall be appointed or act as receiver of a railroad or other corporation within this state.
Ohio Rev. Code Ann. § 2735.02 (emphasis added); see also Metro. Sav. Bank v. Papadelis, No. 2380-M, 1995 WL 542214 (Ohio CtApp. Sept. 13, 1995) (“[T]he only limiting qualifications imposed upon a receiver are that except by consent, a party, attorney or person interested in the case cannot serve as a receiver, and a receiver of a corporation or railroad must be an Ohio resident.”).
As such, the trial court erred in appointing a Florida receiver to control an Ohio corporation and property. We therefore reverse section II of the court’s order, and remand for the termination of the receivership over Barrington Spring House, LLC, and its real property in Ohio.
Reversed and Remanded.
. As part of their claim, appellees assert that this mortgage was fraudulently placed on this property by Edelsten.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.