Title First Agcy. v. Xpress Closing Serv., Unpublished Decision (1-22-2004)
Title First Agcy. v. Xpress Closing Serv., Unpublished Decision (1-22-2004)
Opinion of the Court
OPINION
{¶ 1} Plaintiffs-appellants, Title First Agency, Inc. ("Title First") and Park Place Title Agency, Ltd. ("Park Place"), appeal from a judgment of the Franklin County Court of Common Pleas granting a directed verdict in favor of defendants-appellees, Bank One, N.A., Fifth Third Bank, First Merit Corporation, and Lima Superior Community Federal Credit Union ("Lima Superior"), on appellants' conversion claims. Because reasonable minds could differ regarding whether the person to whom the converted instruments were delivered was appellants' agent, we reverse the judgment of the common pleas court and remand this matter for further proceedings.{¶ 2} By complaint filed December 18, 2001, appellants initiated this lawsuit against appellees and Xpress Closing Service, Inc. ("Xpress"), Scott Rotkowski, an officer or shareholder of Xpress, North Shore Enterprises, Inc., dba Lorain County Currency Exchange ("North Shore"), Emmett Ross, individually and dba A-1 Bail Bonding and First Bank of Ohio. Appellants averred that they hired Xpress/Rotkowski to conduct real estate closings. Appellants authorized Rotkowski to execute documents during the closings and to receive and immediately forward any checks he received at those closings to appellants. During the subject closings, Rotkowski received four checks made payable to appellants. However, rather than forwarding the checks to appellants, Rotkowski endorsed the checks" Xpress closing service Rotkowski" and cashed them.1 The checks were all cashed at either North Shore or A-1 Bail Bonding. Appellees are all banks who further negotiated the checks. Appellants eventually dismissed First Bank of Ohio with prejudice and obtained a default judgment against Xpress, Rotkowski, North Shore and Mr. Ross, individually and dba A-1 Bail Bonding.
{¶ 3} This appeal involves appellants' claims against appellees for conversion pursuant to R.C.
{¶ 4} Appellants appeal, assigning the following assignments of error:
1. The trial court erred in granting defendants' motion for a directed verdict.
2. The trial court erred in denying plaintiffs['] motion for summary judgment.
{¶ 5} Appellants contend in their first assignment of error that the trial court erred in granting a directed verdict on their conversion claims because Rotkowski was appellants' agent for purposes of accepting delivery of the instruments; therefore, appellants could bring conversion claims against appellees pursuant to R.C.
{¶ 6} A motion for a directed verdict may be granted when the trial court, construing the evidence most strongly in favor of the non-moving party, finds that, upon any determinative issue, reasonable minds can come to but one conclusion upon the evidence submitted and that conclusion is adverse to the non-moving party. Civ.R. 50(A)(4); Malone v. Courtyard by Marriott L.P. (1996),
{¶ 7} R.C.
The law applicable to conversion of personal property applies to instruments. An instrument also is converted if it is taken by transfer, other than a negotiation, from a person not entitled to enforce the instrument or if a bank makes or obtains payment with respect to the instrument for a person not entitled to enforce the instrument or receive payment. An action for conversion of an instrument may not be brought by the issuer or acceptor of the instrument or a payee or indorsee who did not receive delivery of the instrument either directly or through delivery to an agent or a co-payee.
{¶ 8} Because appellants are payees, appellants can bring claims for conversion of the instruments under R.C.
{¶ 9} This court has defined an agency relationship as "`the fiduciary relationship which results from the manifestation of consent by one person [principal] to another [agent] that the other shall act on his behalf and subject to his control, and consent by the other so to act.'" Berge v. Columbus CommunityCable Access (1999),
{¶ 10} In contrast to an agency relationship where the agent consents to act on behalf of the principal, but subject to the principal's control, an "independent contractor" is defined as "`one who carries on an independent business, in the course of which he undertakes to accomplish some result or do some piece of work, for another, being left at liberty in general to choose his own means and methods, and being responsible to his employer only for the results which he has undertaken to bring about.'" Abramsv. Toledo Auto. Dealers Assn. (2001),
{¶ 11} The Ohio Supreme Court has set out a test to distinguish an agency relationship (sometimes also referred to as a master-servant relationship) from an employer-independent contractor relationship:" Did the employer retain control of, or the right to control, the mode and manner of doing the work contracted for? If he did, the relationship is that of principal and agent or master and servant. If he did not but is interested merely in the ultimate result to be accomplished, the relationship is that of employer and independent contractor."Councell v. Douglas (1955),
{¶ 12} Here, the evidence of whether appellants' relationship with Rotkowski or Xpress was that of principal-agent or employer-independent contractor is conflicting. The evidence indicates that appellants sporadically hired Rotkowski to handle individual closings and instructed him when and where each closing would take place. They required him to perform specific tasks during the closing and faxed him a specific list of closing instructions for at least one of the closings at issue here. Appellants provided Rotkowski with all the documents necessary to complete each closing. Appellants authorized him to accept checks at the closings, but did not authorize him to endorse or deposit the checks. Appellants also provided Rotkowski with an overnight return envelope for him to immediately return the signed documents and checks to appellants' office.
{¶ 13} Several of appellants' employees testified that neither Rotkowski nor Xpress were appellants' agent, employee or representative, and that delivery of the instruments occurred only when the appellants actually received the instruments. Other testimony indicated a special agency relationship. For example, Kathy Nicholson, appellants' operation manager, expressly testified that Rotkowski was appellants' agent for the limited purpose of accepting delivery of checks on appellants' behalf.
{¶ 14} Construing all of the evidence in favor of appellants, and giving appellants, as the non-moving parties, the benefit of all reasonable inferences from the evidence, we conclude that reasonable minds could differ on whether appellants had sufficient control of Rotkowski's conduct under their agreement to create a special agency for the limited purpose of receiving checks on appellants' behalf during the closing and then forwarding those checks to appellants' office. Therefore, the trial court erred in granting appellees' motion for a directed verdict.
{¶ 15} This conclusion is further supported by the analysis set forth by the Supreme Court of Virginia in a case involving an analogous factual situation. Hartzell Fan, Inc. v. Waco, Inc.
(Va. 1998),
{¶ 16} Appellees also argue that appellants failed to demonstrate that the checks were delivered to Rotkowski. Delivery is defined as a "voluntary transfer of possession." R.C.
{¶ 17} Therefore, appellants' first assignment of error is sustained.
{¶ 18} Appellants contend in their second assignment of error that the trial court erred in denying its motion for summary judgment. However, a trial court's order denying a motion for summary judgment is not a final appealable order. Featherstonev. CM Media, Inc., Franklin App. No. 02AP-65, 2002-Ohio-6747, at ¶ 19, citing State ex rel. Overmyer v. Walinski (1966),
{¶ 19} Having sustained appellants' first assignment of error, we reverse the trial court's judgment and remand this matter to the trial court for proceedings consistent with this opinion. That portion of the appeal which relates to appellants' second assignment of error is dismissed.
Judgment reversed and cause remanded.
Lazarus, P.J., and Brown, J., concur.
Reference
- Full Case Name
- Title First Agency, Inc., and Park Place Title Agency, Ltd. v. Xpress Closing Service, Inc.
- Cited By
- 4 cases
- Status
- Unpublished