[Cite as Coastline Ohio, LLC v. Extended Family Concepts, Inc.,

.]

COURT OF APPEALS STARK COUNTY, OHIO FIFTH APPELLATE DISTRICT

COASTLINE OHIO, LLC, ET AL. JUDGES: Hon. William B. Hoffman, P.J. Plaintiff-Appellees Hon. John W. Wise, J. Hon. Julie A. Edwards, J. -vs- Case No. 2010CA00113 EXTENDED FAMILY CONCEPTS, INC. DBA HEATHER RIDGE COMMONS OPINION Defendant-Appellants

CHARACTER OF PROCEEDING: Appeal from the Stark County Court of Common Pleas, Case No. 2010CV00917

JUDGMENT: Affirmed

DATE OF JUDGMENT ENTRY: February 22, 2011

APPEARANCES:

For Plaintiff-Appellees For Defendant-Appellants Coastline Ohio LLC

COLLEEN M. O'NEIL JAMES M. MCHUGH NATHAN A. WHEATLEY JOHN D. RAMSEY ALEXANDER B. REICH Tzangas, Plakas, Mannos & Raies, LTD. Calfee, Halter & Griswold, LLP 220 Market Avenue, South 1400 KeyBank Center Eighth Floor 800 Superior Avenue Canton, Ohio 44702 Cleveland, Ohio 44114

For Receiver, SAK-Ohio

NANCY A. VALENTINE JEFFREY A. BRAUR EMILY W. LAKKY Hahn Loeser & Parks, LLP 200 Public Square Suite 2800 Cleveland, Ohio 44114 Stark County, Case No. 2010CA00113 2

Hoffman, P.J.

{¶1} Defendant-appellant Extended Family Concepts, Inc. d/b/a/ Heather Ridge

Commons appeals the April 8, 2010 Order of the Stark County Court of Common Pleas

appointing Appellee SAK Management – Ohio, LLC as receiver. Plaintiff-appellee is

Coastline Ohio, LLC.

STATEMENT OF THE FACTS AND CASE

{¶2} Extended Family Concepts, Inc. d/b/a Heather Ridge Commons

(“Extended Family”) provides assisted living facilities to residents in Stark County. In

August of 2007, Heather Ridge entered into a loan agreement with Affinity Bank, a

California company later acquired by Pacific Western Bank from the Federal Deposit

Insurance Corporation. In February of 2010, Coastline Ohio, LLC (“Coastline”) acquired

all of the rights and interests of Pacific Western Bank through various agreements.

{¶3} Following Appellant’s alleged default on the loan agreement, Coastline

filed the complaint in this matter for collection on a note, foreclosure, replevin and

appointment of receiver against Extended Family.

{¶4} The trial court conducted an evidentiary hearing on the motion for

appointment of receiver on March 17, 2010.

{¶5} Via Judgment Entry of March 23, 2010, the trial court stated it was not

convinced SAK Management – Ohio, LLC should be appointed receiver in this matter

and ordered the parties to meet with Gregory F. McNulty III, CPA, JD of Bruner Cox,

LLP to review Appellant’s financials and to determine whether or not the firm could act

as receiver in this matter. It was later determined Bruner Cox, LLP could not be

appointed as receiver due to a conflict of interest. Stark County, Case No. 2010CA00113 3

{¶6} As a result Appellee Coastline filed a motion for reconsideration of the trial

court’s March 23, 2010 Judgment Entry requesting appointment of SAK as receiver

citing the conflict of interest and SAK’s industry experience.

{¶7} On March 30, 2010, the trial court issued an Order Appointing Receiver in

which the court appointed SAK Management-Ohio, LLC, Inc., through Suzanne Koenig,

its sole member, as receiver of all the assets and all real and personal property of

Extended Family.

{¶8} On March 31, 2010, Appellant Extended Family filed a motion for

reconsideration of the court’s appointment of receiver by order of March 30, 2010. The

motion cites the trial court’s March 23, 2010 Judgment Entry arguing the trial court

found SAK Management-Ohio, LLC, through Suzanne Koenig, its sole member, an

inappropriate appointment with all powers enumerated in Plaintiff’s proposed order.

Further, Appellant Extended Family argued service of Appellee’s motion for

reconsideration was not made upon counsel for Extended Family until March 29, 2010,

therefore, Extended Family did not have adequate notice and/or opportunity to be heard

before the trial court issued its order.

{¶9} On Motion of Extended Family, the trial court stayed execution of the

March 30, 2010 order pending hearing of Appellant’s motion for reconsideration.

{¶10} On April 8, 2010, the trial court issued an order amending, in part, the

order appointing the receiver, and vacating the stay of execution. The order amended

the scope of authority of the receiver, but reaffirmed the decision to appoint SAK

Management-Ohio, LLC, through Suzanne Koenig, its sole member, as receiver.

{¶11} Appellant Extended Family now appeals, assigning as error: Stark County, Case No. 2010CA00113 4

{¶12} “I. THE TRIAL COURT ABUSED ITS DISCRETION BY ENTERING ITS

APRIL 8, 2010 ORDER WHICH APPOINTED SAK MANAGEMENT-OHIO, LLC, AS

RECEIVER AND GRANTED SAK MANAGEMENT-OHIO THE EXTENSIVE POWERS

ENUMERATED IN THE STAYED MARCH 30, 2010 ORDER.”

{¶13} Initially, we note, a trial court’s decision to appoint a receiver is reviewed

under an abuse of discretion standard. Equity Centers Development Company v. South

Coast Centers, Inc. (1992),

. An abuse of discretion means more

than an error of law or judgment, it implies that the trial court’s attitude was

unreasonable, arbitrary, or unconscionable. Blakemore v. Blakemore (1983),

.

{¶14} Extended Family asserts the trial court’s March 23, 2010 Judgment Entry

found SAK Management-Ohio, LLC to be an inappropriate selection for receiver. Yet

Appellant’s brief admits the trial court “properly appointed a receiver after considering

hours of testimony and other evidence at the March 17, 2010 hearing.” Appellant

Extended Family has provided no authority to suggest the trial court exceeded its broad

statutory discretion to define a receiver’s powers.

{¶15} We find Appellant’s brief mischaracterizes the language of the trial court’s

March 23, 2010 Judgment Entry asserting the trial court rejected or found SAK

inappropriate for appointment as the receiver. The trial court’s Judgment Entry states,

{¶16} “However, at this time the Court is not convinced that SAK Management-

Ohio, LLC, through Suzanne Koenig, its sole member, should be appointed as receiver

with all powers enumerated in Plaintiff’s proposed order. Stark County, Case No. 2010CA00113 5

{¶17} “Instead, the Court ORDERS the parties to meet with Gregory F. McNulty,

III, C.P.A., J.D., of Bruner-Cox, LLP to review Defendant’s financials and to determine

whether or not the firm is in a position to act as receiver in this matter.***” (Emphasis

added.)

{¶18} The trial court never made a finding SAK Management-Ohio, LLC was

inappropriate for appointment as receiver. Rather, the trial court seemingly makes a

preference for a local appointment instead of the out-of-town SAK. The statement the

court is “not convinced” is not tantamount to a finding of “inappropriate” or rejection.

Upon discovery of a conflict of interest with Bruner Cox, the trial court then proceeded to

reconsider and appoint SAK Management-Ohio, LLC.

{¶19} Appellant thinly veils the procedural history asserting the trial court did not

afford Appellant notice or an opportunity to be heard. However, a review of the record

demonstrates the trial court stayed execution of its March 30, 2010 Order pending a

hearing on Appellant’s motion for reconsideration. The trial court issued an order

amending in part the order appointing the receiver on April 8, 2010, which indicates the

trial court further considered the matter based upon the April 5, 2010 hearing. We find

the trial court provided Appellant Extended Family notice and opportunity to be heard

before issuing its April 8, 2010 Order. Stark County, Case No. 2010CA00113 6

{¶20} We do not find the trial court abused its discretion in appointing SAK

Management-Ohio LLC as receiver in this matter, and Appellant Extended Family’s sole

assignment of error is overruled.

By: Hoffman, P.J.

Wise, J. and

Edwards, J. concur

s/ William B. Hoffman _________________ HON. WILLIAM B. HOFFMAN

s/ John W. Wise _____________________ HON. JOHN W. WISE

s/ Julie A. Edwards___________________ HON. JULIE A. EDWARDS Stark County, Case No. 2010CA00113 7

IN THE COURT OF APPEALS FOR STARK COUNTY, OHIO FIFTH APPELLATE DISTRICT

COASTLINE OHIO, LLC, ET AL. : : Plaintiff-Appellees : : -vs- : JUDGMENT ENTRY : EXTENDED FAMILY CONCEPTS, INC. : DBA HEATHER RIDGE COMMONS : : Defendant-Appellants : Case No. 2010CA00113

For the reasons stated in our accompanying Opinion, the judgment of the Stark

County Court of Common Pleas is affirmed. Costs to Appellant.

s/ William B. Hoffman _________________ HON. WILLIAM B. HOFFMAN

s/ John W. Wise _____________________ HON. JOHN W. WISE

s/ Julie A. Edwards ___________________ HON. JULIE A. EDWARDS