Beder v. Cerha Kitchen & Bath Design Studio, L.L.C.

[Cite as Beder v. Cerha Kitchen & Bath Design Studio, L.L.C., 

.]



               IN THE COURT OF APPEALS OF OHIO
                           ELEVENTH APPELLATE DISTRICT
                                 GEAUGA COUNTY

ILIA BEDER, et al.,                                   CASE NO. 2022-G-0008

                Plaintiffs-Appellants,
                                                      Civil Appeal from the
        -v-                                           Court of Common Pleas

CERHA KITCHEN AND BATH
DESIGN STUDIO, LLC, et al.,                           Trial Court No. 

                Defendants-Appellees.


                                             OPINION

                                Decided: December 12, 2022
                 Judgment: Affirmed in part, reversed in part, and remanded


Daniel J. Myers, Myers Law, LLC, 600 East Granger Road, Second Floor, Cleveland,
OH 44131 (For Plaintiffs-Appellants).

Thomas C. Holmes, Holmes Legal Services, LLC, 34194 Aurora Road, Suite 295, Solon,
OH 44139 (For Defendants-Appellees).


JOHN J. EKLUND, P.J.

        {¶1}    Appellants, Ilia Beder and Raimonda Beder, appeal the February 2, 2021

and January 24, 2022 judgments of the Geauga County Court of Common Pleas,

respectively, granting summary judgment in favor of Appellees, Cerha Kitchen and Bath

Design Studio, LLC, Custom Remodeling and Design, LLC, Jim Cerha, and Laura Cerha.

        {¶2}    This case originated as a consumer lawsuit Appellants filed against

Appellees, the contractors remodeling their house. Appellants’ complaint alleged four

counts: (1) Breach of Contact; (2) Unjust Enrichment; (3) violations of the Consumer
Sales Practices Act (“CSPA”); and, alternatively, (4) violations of the Home Construction

Service Suppliers Act (“HCSSA”). Appellees filed an answer and counterclaim against

Appellants for defamation and breach of contract claiming that Appellants had

unexpectedly terminated the contract without cause.

       {¶3}   The court granted summary judgment in Appellants’ favor on the defamation

counter claim after Appellees failed to oppose or present evidence of defamation. Laura

Cerha was then dismissed from the litigation. Appellees sought summary judgment on

their breach of contract counterclaim and the claims in Appellants’ complaint. The court

granted summary judgment on all issues except: (1) Raimonda Beder’s liability for breach

of contract, and (2) damages for the Beder’s breach of contract. The case proceeded to

a bench trial on the remaining issues. At trial, appellees stipulated that Raimonda was

not liable for the breach of contract. The trial court awarded Appellee Cerha Kitchen and

Bath Design Studio, LLC $1,297 in damages and $1,011.66 in interest for damages on

its breach of contract counterclaim.

       {¶4}   Appellants timely appealed and raise three assignments of error.

       {¶5}   First assignment of error: “The trial court committed prejudicial error when

it granted summary judgment in favor of Appellees on Appellants' CSPA claims, and/or

later refused to reconsider that grant. (T.d. 94, p. 1-2; T.d. 106).”

       {¶6}   Summary judgment is appropriate when “there is no genuine issue as to

any material fact and the moving party is entitled to judgment as a matter of law,” i.e.,

when “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, that party being

entitled to have the evidence or stipulation construed most strongly in the party’s favor.”

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Case No. 2022-G-0008
Civ.R. 56(C). An appellate court reviews a summary-judgment ruling de novo. Fradette

v. Gold, 

, 

, 

, ¶6.

      {¶7}   Under their first assignment, Appellants assert that the trial court erred in

ruling that the HCSSA and not the CSPA applied because the transaction involved the

remodel of an existing home, not the building of a new home.

      {¶8}   “The Consumer Sales Practices Act prohibits unfair or deceptive acts and

unconscionable acts or practices by suppliers in consumer transactions.” Einhorn v. Ford

Motor Co., 

, 

 (1990); R.C. 1345.02; R.C. 1345.03.

The HCSSA, similarly, prohibits certain deceptive acts in connection with work relating to

home construction service and seeks to protect individual homeowners entering into such

contracts. See R.C. 4722.01 et seq.

      {¶9}   Prior to the enactment of the HCSSA on August 31, 2012, agreements

between remodelers and homeowners were “consumer transactions” within R.C. Chapter

1345. See Danley v. Bialko, 9th Dist. Lorain No. 91CA005024, 

, *1 (Oct.

2, 1991); Collins v. Kingsmen Ents., Inc., 8th Dist. Cuyahoga No. 66433, 

,

*2 (Jan. 19, 1995).    However, with the enactment of the HCSSA, the definition of

“consumer transaction” was amended to exclude “transactions involving a home

construction service contract as defined in section 4722.01 of the Revised Code * * *.”

R.C. 1345.01(A).

      {¶10} A “home construction service contract” is “a contract between an owner and

a supplier to perform home construction services, including services rendered based on

a cost-plus contract, for an amount exceeding twenty-five thousand dollars.” (Emphasis

added.) R.C. 4722.01(C). “Home construction service” means “the construction of a

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Case No. 2022-G-0008
residential building. ‘Home construction service’ does not include construction performed

on a structure that contains four or more dwelling units, except for work on an individual

dwelling unit within that structure, or construction performed on the common area of a

condominium property.” (Emphasis added.) R.C. 4722.01(B). “Residential building”

means a “one-, two-, or three-family dwelling and any accessory construction incidental

to the dwelling.” R.C. 4722.01(F).

      {¶11} At issue is whether “home construction service,” i.e., the “construction of a

residential building,” includes remodeling. We conclude that it does not.

      {¶12} Our paramount concern in examining a statute is the legislature’s intent in

enacting the statute. Gabbard v. Madison Local School Dist. Bd. of Edn., 

, 

, 

, ¶ 13. To discern that intent, we first consider

the statutory language, reading all words and phrases in context and in accordance with

the rules of grammar and common usage. Id.; see R.C. 1.42. When the statutory

language is unambiguous, we apply it as written without resorting to rules of statutory

interpretation or considerations of public policy. Gabbard at ¶ 13.

      {¶13} R.C. 4722.01 does not define “construction.” The Supreme Court of Ohio

has previously defined “construct” as “‘to build; put together; make ready for use” and

“construction” as “‘[t]he creation of something new, as distinguished from the repair or

improvement of something already existing.’” (Emphasis sic.) State ex rel. Celebrezze

v. Natl. Lime & Stone Co., 

, 382 

 (1994), quoting Black’s

Law Dictionary 312 (6th Ed.1990); see also United States v. Narragansett Improvement

Co., 

 (D.R.I. 1983) (“The uniform conclusion is that ‘construction’

imports the creation of something new and original that did not exist before”).

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Case No. 2022-G-0008
       {¶14} We acknowledge that the current definition of “construction” in Black’s Law

Dictionary no longer expressly distinguishes between “new” and “existing.” However, this

does not mean that the Celebrezze court’s interpretation is invalid. “The Legislature is

presumed to know the decisions of [the Supreme Court of Ohio], and, where it uses words

or phrases that have been defined or construed by th[e] court, it is presumed have used

them in the sense that they have been so defined or construed.” Tax Comm. of Ohio v.

Sec. Sav. Bank & Trust Co. of Toledo, 

, 

 (1927).

Therefore, we must presume that the legislature intended the term “construction” to have

the meaning set forth in Celebrezze.

       {¶15} The dissent relies on Merriam Webster to discern the “ordinary meaning” of

“construction.” The problem with this is, and always has been, that what the “ordinary

meaning” of a word is in a particular walk of life, profession or business often varies wildly.

For example, to an art teacher, “construction” may connote a type of paper. To a

grammatician, it may mean a learned pairing of linguistic patterns with meanings. To a

lawyer or judge, it may refer to the “art of seeking the intention of the legislature” in writing

a statute or other enactment and applying it to a given set of facts. And, to a contractor,

what it means may depend on the kind of work they contract to do. In each case, what is

the “plain and ordinary” meaning of the word to some may mean nothing (or at least

something else) to others. Dictionary definitions are blunt tools, at best.

       {¶16} Appellees contend that the legislature intended “construction” to have a

broader meaning, noting that the initial version of H.B. 383 defined “home construction

services” as “the construction of a new residential building or the substantial rehabilitation

of a residential building,” while the final version eliminated the word “new” and the

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Case No. 2022-G-0008
“substantial rehabilitation” phrase.   (Emphasis added.)       However, a court may only

consider legislative history to determine the meaning of an ambiguous statute. See R.C.

1.49(C). A court may not resort to legislative history to alter the clear wording of the

legislative enactment. DIRECTV, Inc. v. Levin, 

, 

 (10th Dist.).

       {¶17} When construed in context, we conclude that “home construction service,”

i.e., the “construction of a residential building,” encompasses the building of (1) one-, two-

, or three-family dwellings, (2) accessory structures incidental to those dwellings, and (3)

individual dwelling units within structures that contain four or more dwelling units.

Accordingly, “home construction service” does not encompass remodeling. Therefore,

the trial court erred as a matter of law in determining that the HCSSA applied rather than

the CSPA.

       {¶18} Appellants’ first assignment of error has merit. We reverse this aspect of

the trial court’s judgment and remand for further proceedings.

       {¶19} Appellant’s second assignment of error states:

       {¶20} If the CSPA does not apply to the transaction, the trial court
             committed prejudicial error when it granted summary judgment in
             favor of Appellees on Appellants’ HCSSA claims.

       {¶21} This assigned error is rendered moot based on our disposition of Appellant’s

first assignment of error.

       {¶22} Appellant’s third assignment of error states:

       {¶23} The trial court committed prejudicial error when it granted summary
             judgment in favor of Appellees as to liability on their breach of
             contract claims against Ilia Beder and Ilia Beders’ breach of contract
             and unjust enrichment claims against Appellees.


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Case No. 2022-G-0008
       {¶24} Under this assigned error, appellants argue that the trial court erred in

determining Ilia Beder’s removal of appellees from the project was a breach of contract.

In support, appellants argue that appellees lacked the legally necessary contractor

registration, unreasonably delayed their work, performed defective work, and were

abusive to appellants. Appellants also argue that the trial court erred in determining that

no question of fact remained concerning the performance of work or initial, material

breach by appellees. We address each contention in turn.

       {¶25} In holding that appellees’ failure to obtain permits or register with the City of

Mentor, the trial court stated:

       {¶26} The Court cannot accept Plaintiff's contention that no contract
             existed because the Defendant or its subcontractors had not
             registered with the city of Mentor thereby, Plaintiff’s argue, making
             the entire contract “illegal.” Plaintiffs have not demonstrated to this
             Court’s satisfaction that such a result is appropriate in cases where
             tradesmen fail to register. Moreover, Plaintiffs have failed to provide
             any evidence creating an issue of fact concerning Defendants sworn
             testimony that a city official informed Defendants that such
             registration was unnecessary.

       {¶27} “In summary judgment proceedings, a court may not weigh the evidence or

judge the credibility of sworn statements, properly filed in support of or in opposition to a

summary judgment motion, and must construe the evidence in favor of the nonmoving

party.” Telecom Acquisition Corp. I v. Lucic Ents., Inc., 8th Dist. Cuyahoga No. 102119,

, ¶ 93 citing Anderson v. Liberty Lobby, Inc., 

, 

, 

 (1986). “When trial courts choose between competing

affidavits and testimony, they improperly determine credibility and weigh evidence

contrary to summary judgment standards.” Lucic 

 citing Finn v. Nationwide

Agribusiness Ins. Co., 3d Dist. Allen No. 1-02-80, 

, ¶ 39.

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Case No. 2022-G-0008
       {¶28} Appellants produced the relevant part of the Mentor Codified Ordinance,

which stated that contractors are required to register and that failure to register constitutes

a fourth-degree misdemeanor. Appellees’ sworn testimony is that when they called the

Mentor Building Department, they were told they did not need to register. Appellants in

this case were the non-moving party. However, the trial court viewed appellees’ argument

that the City of Mentor Building Department told them that no registration or permit was

required as more convincing than appellants’ assertion that regardless of what the

building department said, the local ordinance requires registration. It was improper for

the trial court to engage in this determination of credibility at this stage, and to weigh this

factor in the moving party’s favor.

       {¶29} This necessarily raises a question of law: whether a violation of the Mentor

Codified Ordinance rendered the contract void and unenforceable. If it does not, the trial

court’s error would be harmless. As discussed below, however, we find that a contract

that violates a valid codified ordinance is void and unenforceable, and thus, the court’s

error was not harmless.

       {¶30} The Eighth District in McClennan v. Irvin & Co., 8th Dist. Cuyahoga No.

36798, 

 (Jan. 30, 1978), noted that “[a]s a general rule, professional

contracts which violate registration statutes are unenforceable.” Id. at *4. In that case,

an architectural firm entered into a contact to perform architectural services. The firm had

only one employee who was a registered architect, and he “delegated the ‘entire job * *

*,’ a senior architectural designer but not an architect, under [the registered architect’s]

supervision.” Id. at *3. The senior architectural designer was to perform all the work; the

registered architect never personally visited the project site and testified he believed it

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Case No. 2022-G-0008
was unnecessary for him to do so. The relevant statute in that case required anyone

engaging in the practice of architecture to be a registered architect. The court found the

services performed by the party in that case was the practice of architecture. Under the

circumstances in that case, the Eighth District reversed the trial court, finding that the firm

could not recover for services rendered under the “illegal contract.”

       {¶31} Similarly, the Fourth District has noted that “[t]he general rule is that a

contract entered into by a person engaged in a business without taking out a license as

required by law is void and unenforceable and that where a license or certificate is

required by statute as a requisite to one practicing a particular profession, an agreement

of a professional character without such license or certificate is illegal and void.” Elephant

Lumber Co. v. Johnson, 

 (4th Dist.1964), citing 53 C.J.S. Licenses

§ 59, p. 711; 33 American Jurisprudence, 384; 34 Ohio Jurisprudence 2d 388. “It is also

a well established rule that a contract which cannot be performed without a violation of a

statute is void.” Elephant Lumber, citing National Transformer Corp. v. France Mfg. Co.,

 (6th Cir. 1954) and Bell v. Northern Ohio Tel. Co., 

, 

 (1948).

       {¶32} Appellees attempt to distinguish these cases from the facts at bar by

arguing that “courts have refused to apply these cases to lawsuits that are not entirely on

point.” In support, they cite Greenspan v. Third Fed. Savings & Loan Assoc., 

, 

, 

. However, Greenspan declined to extend

these arguments to claims related to the unauthorized practice of law. We find no such

material distinction between the above-cited cases and the facts at bar.

       {¶33} Mentor Codified Ordinance 1307.01 states in pertinent part:

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Case No. 2022-G-0008
       {¶34} No contractor shall perform any work in the City without first
             obtaining a certificate of registration from the Building Inspection
             Division. Any contractor who contracts with the general public to
             perform work regulated by this chapter must be registered with the
             City to do such work. (Emphasis added.) 

       {¶35} The ordinance plainly states the contract shall be registered before the

performance under a contract begins. In this case, appellees began performance under

the contract without registering, but assert they were not required to register.

       {¶36} The general rule remains; contracts that violate statutory law are void and

unenforceable. We see no material distinction between a contract that violates a statute

versus one that violates a valid city ordinance. Accordingly, if the question of fact is

resolved in appellants’ favor and it is determined that appellees did not obtain the required

registration prior to performing work under the contract with appellants, the contract would

be illegal and unenforceable.       Thus, the court’s error in weighing the testimony of

appellees in favor of appellees as the moving party, was not harmless error.

       {¶37} Because the trial court improperly weighed the evidence pertaining to

appellees registration requirements, we find the trial court erred in finding that no question

of material fact remained as to whether appellees were required to register under the

Mentor Codified Ordinance. This conclusion does not, however, preclude appellees from

raising equitable claims, if applicable, in the lower court. Because we find any such error

would not be harmless, we reverse the trial court’s grant of summary judgment on Counts

I and II of the appellants’ initial complaint.

       {¶38} As to appellants’ arguments that they did not breach the contract because

appellees unreasonably delayed their work, performed defective work, and were abusive

to appellants, we find no error on the part of the trial court. Nor do we find error in the

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Case No. 2022-G-0008
trial court’s determination that no question of fact remained concerning the performance

of work or initial, material breach by appellees.

       {¶39} Appellees gave a verbal estimate of the time to complete the project at the

start of the work; appellees testified that the extensions of time were due to appellants’

requests for project changes and custom-ordered items. Nothing in the record contradicts

those assertions. Additionally, we agree with the trial court that appellants’ assertion that

appellees yelled at him and made him stay in his room would constitute a tort claim and

is irrelevant to appellants’ action for breach of contract. Finally, appellees testified that

they addressed appellants’ complaints for defective work to within HBA standards.

Appellants did not present evidence to the contrary; they merely stated it was not

completed to their standards.

       {¶40} In light of the foregoing, appellants’ third assigned error has merit.

       {¶41} The judgments of the Geauga County Court of Common Pleas are affirmed

in part, reversed in part, and remanded to the trial court for further proceedings consistent

with this opinion.



MARY JANE TRAPP, J., concurs,

CYNTHIA WESTCOTT RICE, J., dissents with a Dissenting Opinion.




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Case No. 2022-G-0008
CYNTHIA WESTCOTT RICE, J., dissents with a Dissenting Opinion.

       {¶42} I respectfully dissent and would find that remodeling contracts such as the

one at issue would fall under the HCSSA.

       {¶43} There is no clear agreement or precedent as to the definition of

“construction” as defined in R.C. 4722.01. When the language of statutes is ambiguous,

“‘words should be given their common, ordinary and accepted meaning unless the

legislature has clearly expressed a contrary intention.’” State v. Hix, 

 (1988), quoting State v. Singer, 

 (1977). Courts have often

looked to dictionaries to provide guidance as to the “common, ordinary, and accepted

meaning.” Merriam Webster’s Dictionary defines “construction” as “the process, art, or

manner of constructing something.”       Merriam-Webster, Construction, www.merriam-

webster.com/dictionary /construction (accessed June 15, 2022). Similarly, “constructing”

is defined as “to make or form by combining or arranging parts or elements; build.”

Merriam-Webster, Construct, www.merriam-webster.com/dictionary/construct (accessed

June 15, 2022). These definitions do not limit “construction” to the creation of something

new.

       {¶44} I recognize that the Supreme Court of Ohio has held that the meaning of

the word “construction” is the “creation of something new, as distinguished from the repair

or improvement of something already existing.” State. ex. rel. Celebrezze v. Nat’l Lime &

Stone Co., 

 (1994), quoting Black’s Law Dictionary (6 Ed.1990)

542 and U.S. v. Narragansett Improvement Co., 

 (D.R.I.1983).

However, that 1994 case relied on a definition in Black’s Law Dictionary that has since

been updated. Moreover, the Celebrezze court’s focus in that case was not the definition
                                            12

Case No. 2022-G-0008
of “construction” but “whether the replacement of [a particular] mill in 1987 with a virtually

identical mill constituted the ‘installation’ of an air contaminant source, as that term is

defined and set forth in relevant administrative rules.” Id. at 381. The Court’s definition

of “construction” in Celebrezze was dicta and interpreted in a different context. I agree

the context of words is necessary for an accurate interpretation of their meaning.

Moreover, the meaning of words can change over time. I believe this 1994 Celebrezze

definition of “construction”, which, notably, was used 18 years prior to the enactment of

the HCSSA, is inconsistent with our current understanding of the word.

       {¶45} Additionally, the legislative history of the statute supports a definition of

construction that includes remodeling. As introduced, the bill which would eventually

become the HCSSA and modify the CSPA initially defined “home construction service”

as “the construction of a new residential building or the substantial rehabilitation of a

residential building. ‘Home construction service’ does not include construction performed

on a structure that contains four or more dwelling units, except for work on an individual

dwelling unit within that structure, or construction performed on the common area of a

condominium property.” 2012 Am.Sub. H.B. No. 383. The final definition of “home

construction service” as codified eliminated “new” and “substantial rehabilitation of a

residential building” from its definition. The modification of the definition in this way

evidences an intention for the HCSSA to include work not only on new buildings but to

existing structures as well. This is further supported by the inclusion of “‘work on an

individual dwelling unit within that structure” in the R.C. 4722.01 definition. Id. If the

definition of construction was limited to the construction of new structures, and not

modifications of existing structures, that phrase would be effectively meaningless.

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Case No. 2022-G-0008
      {¶46} Finally, the General Assembly has more recently specifically defined

construction to include new work as well as remodeling in R.C. 4115.03(B)(2). Given that

“construction” is not defined by R.C. 4722.01, I see no reason to deviate from the

definition as used elsewhere in the Revised Code, as it is consistent with the current

common, ordinary, and accepted meaning of “construction” used in this context.

      {¶47} Thus, I would find remodeling contracts that meet the other statutory

requirements of the HCSSA fall under the HCSSA, and not the CSPA. Accordingly, I

dissent.




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Case No. 2022-G-0008