Opinion
Case No. C2-02-CV-901.
November 9, 2004
ORDER
This matter is before the Court pursuant to two pleadings that constitute four separate motions. For the sake of clarity, the Court will list each motion and the respective responses and replies:
1. A Motion in Limine filed by Defendant, Del Baker, d.b.a. Del's Auto Sales to Introduce Recoupment Evidence relative to Plaintiff Roberta Hook's individual claims (Doc. # 83);
2. Plaintiff Roberta Hook's Response in Opposition (Doc. # 84);
3. Defendant's Reply (Doc. # 91);
4. A Motion in Limine filed by Defendant to introduce recoupment evidence relative to the Class claims (Doc. # 83);
5. Plaintiff Roberta Hook's Response in Opposition (Doc. # 84);
6. A Motion in Limine filed by Plaintiff Roberta Hook to limit the introduction of evidence to Roberta Hook's individual transaction with Defendant (Doc. # 84);
7. Defendant's Response (Doc. # 90);
8. A Motion in Limine filed by Plaintiff Roberta Hook to limit the testimony of Defendant's witnesses to issues regarding Plaintiff's individual transaction with Defendant (Doc. # 84).
9. Defendant's Response (Doc. # 90).
The Court will address each motion in turn.
I. BACKGROUND
This action is the result of Plaintiff, Roberta Hook ("Hook"), buying a used car from Defendant, Del Baker, d.b.a. Del's Auto Sales ("Defendant"). Defendant owns and operates a used car lot located in Newark, Ohio. On or about September 21, 2001 Hook and Defendant entered into a consumer credit transaction in the form of a retail installment sales contract and security agreement whereby Defendant sold and then financed for Hook a 1990 Oldsmobile Cutlass automobile. (Baker Dep. Vol. II at 20). In connection with the financing of the vehicle, Defendant provided Hook with a truth-in-lending disclosure statement and security interest ("disclosure document") as required by the Truth In Lending Act, ("TILA") 15 U.S.C. 1601, et. seq. (Baker Dep. Vol. II Ex. A).
Listed on Defendant's disclosure document is a charge of $200.00 labeled "non-taxable charges." (Baker Dep. Vol. II Ex. A). Absent from Defendant's disclosure document are any finance charges imposed upon Plaintiff as an incident to the extension of credit and the disclosure of the annual percentage rate of any such finance charges. Also noticeably absent from the disclosure document is the total sales price of the transaction, the total number of payments in the transaction, and the number of payments she had to make in order to repay her indebtedness. (Baker Dep. Vol. II Ex. A).
Defendant repossessed Hook's car on June 5, 2002. (Pls.' Second Am. Compl. ¶ 63). Thereafter, Hook filed suit on September 16, 2002, alleging claims under the TILA, Ohio Retail Installment Sales Act, R.C. § 1317.01, et seq ("RISA") and the Ohio Consumer Sales Practices Act, R.C. § 1345.01 et seq ("OCSPA"). Id. at ¶¶ 1-78. Additionally, Hook asserted claims for common law theft and conversion. Id. at ¶¶ 79-91. Specifically, Hook alleged that defendant failed to disclose the: (1) number of payments scheduled to repay any indebtedness to defendant; (2) finance charge; (3) Annual Percentage Rate ("APR"); (4) total of payments, or the total sales price in connection with any consumer transaction. Hook also asserted that Defendant assessed or contracted for a documentary service charge in excess of $50.00 in connection with financing retail installment sales transactions.
On December 26, 2002, Hook filed an Amended Complaint. (Doc. # 5). The Amended Complaint added class allegations for violations of the TILA, RISA and OCSPA, while retaining Hook's individual claims for violations of the RISA, OCSPA and for theft and conversion. (Pls.' First Am. Compl. ¶¶ 1-86). Thereafter, Hook sought, and obtained, leave to amend her complaint a second time to add Latasha McLaughlin ("McLaughlin") as a plaintiff. (Doc. # 15). McLaughlin, like Hook, had purchased and financed an automobile through Defendant. (Pls.' Second Am. Compl. ¶ 4). The second amended complaint retained the class allegations for violations of the TILA, RISA and OCSPA, while asserting McLaughlin and Hook's individual claims for violations of the RISA, OCSPA and for theft and conversion. Subsequently, the Court granted Hook's and McLaughlin's (the "Named Plaintiffs") Motion to Certify Two Classes (Doc. #45) only as to the TILA and RISA claims. One proposed class dealt with the TILA claims, while the other addressed the RISA claims. The Court granted the motion, and certified the classes as follows:
Interestingly, the named plaintiffs did not move to certify their OSCPA class claim. Hook and McLaughlin's individual claims under the OSCPA and RISA, and their claims for theft and conversion, remain.
1. TILA Class:
All persons to whom defendant extended credit between December 26, 2001 and the present date in connection with the sale of any automobile where defendant failed to either disclose the number of payments scheduled to repay the indebtedness, to accurately disclose the finance charge, to accurately disclose the Annual Percentage Rate, to accurately disclose the total of payments or to accurately disclose the total sales price in connection with any consumer transaction.
2. RISA Class:
All persons to whom defendant extended credit between December 26, 1996 and the present date in connection with the sale of any automobile under a retail installment sales contract where defendant either contracted for and or assessed a documentary service charge, or a delivery and handling charge, in excess of $50.
(Doc. # 45, 29-10).
On May 4, 2004, the Named Plaintiffs moved for summary judgment on the issue of Defendant's liability under the TILA and RISA. (Doc. # 51). The Court granted the motion on June 29, 2004. (Doc. # 60). The Court also approved the Named Plaintiffs' proposed Class Notice. (Doc. # 61). Thus, as it stands now, the Plaintiffs' class is certified, Defendant is liable to the Class Plaintiffs for violating the TILA and RISA, and the class notice is approved. Damages have yet to be determined as to those two class claims; the Court will schedule a damages hearing on that issue after all of the possible Class Plaintiffs have had a chance to respond to the Class Notice.
Regarding Plaintiff Roberta Hook's and Plaintiff Latasha McLaughlin's individual claims against the Defendant, the Court dismissed Latasha McLaughlin's claims against the Defendant with prejudice for want of prosecution on October 26, 2004 (Doc. # 89). Thus, the case is set for a bench trial on November 15, 2004 on the issue of Defendant's liability on Plaintiff Roberta Hook's individual claims only. With these facts and procedural history in mind, the Court now turns to an examination of the motions currently before the Court.
II. DISCUSSION
A. DEFENDANT'S MOTION REGARDING INTRODUCING RECOUPMENT EVIDENCE AT THE NOVEMBER 15, 2004 BENCH TRIAL ON PLAINTIFF ROBERTA HOOK'S INDIVIDUAL CLAIMS.
The Court conducted a Final Pre-Trial Conference on this matter on September 29, 2004. At that conference, Defendant indicated that he wished to produce evidence relative to the issue of recoupment at the Court's November 15, 2004 bench trial on Plaintiff Roberta Hook's individual claims. Although Motions in Limine are designed to prevent the introduction of evidence, the Court instructed Defendant to file his request in the form of a Motion in Limine so that the Court could consider the relevance and admissibility of such evidence in advance of the bench trial.
Recoupment is defined as:
the right of a defendant, in the same action, to cut down the plaintiff's demand either because the plaintiff has not complied with some cross obligation of the contract on which he sues or because he has violated some duty which the law imposes on him in the making or performance of that contract.Coxson v. Commonwealth Mortgage Co. of Am., L.P., 43 F.3d 189, 193 (5th Cir. 1995). In other words, recoupment is a "defense arising from the same transaction as the Plaintiff's claim, and which entitles the Defendant to reduce the amount demanded, but only to the extent sufficient to satisfy the Plaintiff's claim." Riley v. Montgomery, 463 N.E.2d 1246, 1248-49 (Ohio 1984); see also Ohio Akron Nat'l Bank Trust Co. v. Roundtree, 395 N.E.2d 525 (Ohio Ct.App. 9th Dist. 1978). Furthermore, recoupment does not "confess the indebtedness alleged in the complaint." Cauffiel machinery Co. v. Eastern Steel Metal Co., 391 N.E.2d 743, 746 (Ohio Ct.App. 6th Dist. 1978).
As such, recoupment is a strict defense. A strict defense is defined as a defense "which grow[s] out of the same transaction connected with the plaintiff's claim." Summers v. Connolly, 159 Ohio St. 396 (1953).
Ohio has long recognized the common-law defense of recoupment to reduce damages sought to be recovered by the Plaintiff. Ernst v. Ohio Dept. of Admin. Services, et al., 590 N.E. 2d 812, 818 (Ohio Ct.App. 10th Dist. 1990) (quoting Upton Co. v. I.J. Julian Co., 7 Ohio St. 95 (Ohio 1857); Riley, 463 N.E.2d at 1249; Health Admin'rs of America, Inc. v. American Medical Security, Inc., 2001 Ohio App. LEXIS 1469 at * 12 (Ohio Ct.App. 5th Dist. 2001). Specifically, the Ohio Supreme Court held:
It is a right so reasonable in itself, so necessary to the simple and economical administration of justice, and so entirely congenial to our system of jurisprudence, that, however doubted or denied in some parts of the State, it has, in general, commended itself to our courts, and become well-established.Upton, 7 Ohio St. at 97 (internal citations omitted).
In the instant case, Defendant asserts that Plaintiff breached her retail installment sales contract for the car with Defendant by not paying what she owed under the contract (Def.'s Answer Def.'s Mot. at 1; Def.'s Reply at 1). Defendant's defense of recoupment undoubtedly arises from Plaintiff's retail installment sales contract for the car, which is also the basis of all of Plaintiff's individual claims against the Defendant. Additionally, Defendant seeks to reduce the amount Plaintiff can recover by asserting the recoupment defense. (Def.'s Reply at 2). This satisfies the definition of recoupment.
Despite this, Plaintiff asserts two reasons why Defendant is not entitled to introduce recoupment evidence at the November 15, 2004 bench trial. First, Plaintiff argues that if Defendant is found in breach of the retail installment sales contract for the car, then Plaintiff cannot be found in breach (Pl.'s Resp. in Opp'n at 3). This argument fails because both parties can be in breach of the same contract. Second, Plaintiff maintains that if Plaintiff does not prevail, Defendant cannot recoup because Defendant did not assert a counterclaim for recoupment. Again, this argument fails to sway the Court, as the Defendant need not, and indeed does not, assert recoupment as a counterclaim. (Def.'s Reply at 1); See Riley, 463 N.E.2d at 1249; Bennett v. Radlick, 145 N.E.2d 334, 337-38 (Ohio Ct.App. 8th Dist. 1957). Rather, Defendant seeks to assert recoupment as a defense to reduce the amount Plaintiff is awarded, if any; Defendant does not ask for damages. (Def.'s Reply at 1). As such, Defendant will only be able to recoup what he is owed under the contract if the Court finds that Plaintiff violated the contract. Of course, that means that if the Court holds that the Plaintiff did not breach the contract, then the Defendant will not be able to recoup any funds from Plaintiff.
Consequently, because Defendant has satisfied the definition of recoupment, and because the Court finds Plaintiff's arguments to the contrary to be unpersuasive, Defendant's Motion in Limine (Doc. # 83) regarding introducing recoupment evidence at the November 15, 2004 bench trial on Plaintiff Roberta Hook's individual claims is GRANTED.
B. DEFENDANT'S MOTION REGARDING INTRODUCING RECOUPMENT EVIDENCE ON THE CLASS PLAINTIFFS' CLAIMS AT THE NOVEMBER 15, 2004 TRIAL.
The Defendant also requests that the Court issue an Order "allowing him to present evidence that class members of the class action lawsuit filed against him have breached the Retail Installment Sales Contracts and owe money to the Defendant." (Def.'s Mot. at 1). The Plaintiff then filed a Response in Opposition, stating that such information would not be relevant to her individual claims. (Pl.'s Response at 2). However, Defendant later states that he "did not intend to introduce any evidence at the trial of any other class members' breach of contract." (Def.'s Reply at 1).
As the Court previously stated, the November 15, 2004 hearing will only address Plaintiff Roberta Hook's individual claims against the Defendant. Thus, if Defendant still seeks to introduce evidence at the November 15, 2004 trial relative to the actions of other class members in regards to their contracts with the Defendants, the Court DENIES the Defendant's Motion as such evidence would be irrelevant.
C. PLAINTIFF ROBERTA HOOK'S MOTION REGARDING LIMITING EVIDENCE AT THE NOVEMBER 15, 2004 TRIAL TO HER INDIVIDUAL TRANSACTION WITH DEFENDANT.
Plaintiff Roberta Hook filed a Motion in Limine to limit the introduction of evidence to the issue of her individual transaction with Defendant. (Doc. # 84 at 4-5). Defendant indicates that "the only evidence [he] intends to submit to this Court would relate to Class Plaintiff, Roberta Hook's, transaction." (Def.'s Reply at 1).
The November 15, 2004 hearing will address Plaintiff Roberta Hook's individual claims against Defendant. Specifically, Plaintiff has asserted that Defendant, through the transaction that involved the Oldsmobile Cutlass automobile, violated the RISA and OCSPA. (Doc. # 15). Additionally, Plaintiff asserted the Defendant committed theft and conversion by repossessing the Oldsmobile Cutlass when Plaintiff was not in default on her payments. Id. As such, the first issue before the Court on November 15, 2004 will be whether the Defendant violated the RISA and OCSPA in connection with his sales transaction with Plaintiff, and also whether Defendant committed theft and conversion. The second issue will be whether Plaintiff breached the car contract. Consequently, Plaintiff Roberta Hook's Motion in Limine to limit the introduction of evidence to the issue of her transaction with Defendant is GRANTED.
D. PLAINTIFF ROBERTA HOOK'S MOTION IN LIMINE TO EXCLUDE TESTIMONY OF DEFENDANT'S WITNESSES AT THE NOVEMBER 15, 2004 TRIAL.
Finally, Plaintiff filed a Motion in Limine limit the testimony of Defendant's witnesses to "the facts of the physical repossession of the vehicle." (Pl.'s Resp. at 4). The Defendant opposes this Motion, arguing that the testimony of the proffered witnesses is necessary and relevant to the issue of Plaintiff's credibility. (Def.'s Resp. in Opp'n at 1).
The Court DENIES the Plaintiff's Motion for two reasons. First, the credibility of witnesses is always a relevant issue. Second, the Court is without sufficient information to rule on Plaintiff's Motion at this time. However, the Court will be ready to rule on the admissibility and relevance of the individual witnesses' testimony at the trial, when more information will be available.
III. CONCLUSION
The Defendant's Motion in Limine (Doc. # 83) is GRANTED in part and DENIED in part.
The Plaintiff's Motion in Limine (Doc. # 84) is GRANTED in part and DENIED in part.