Parties who are involved in lawsuits are constantly seeking repercussions against the party raising claims against them. A party feeling wrongly accused of wrong doing often seeks to recover costs by asserting the claims were frivolous. In Ohio, there is a frivolous conduct statute that permits, under certain circumstances, the recovery of court costs, reasonable attorney fees and other reasonable expenses. Determining whether such conduct rises to the level of frivolous conduct is subject to a multi-factor review.
Defenses to allegations of frivolous claims are unclear, but more recently one court weighed in on a viable defense. In Bilbaran Farm, Inc. v. Sandusky Street Investments, LLC, 2018-Ohio-299, plaintiff filed suit against a defendant for issues related to an easement. The defendant filed a counterclaim seeking to enforce the easement, or in the event that the court found the easement void, that the trial court find the easement existed by necessity. Plaintiff dismissed its claims, but defendant did not immediately dismiss the counterclaim. After the counterclaim was ultimately dismissed, plaintiff filed a motion for costs under the Frivolous Conduct Statute. The Frivolous Conduct Statute, RC 2323.51, states in part that “any party adversely effected by frivolous conduct may file a motion for an award of court costs, reasonable attorney fees, and other reasonable expenses incurred in connection with the civil action or appeal.”
Ohio courts define frivolous conduct as conduct that “(1) serves merely to harass or maliciously injure another party to the civil action or appeal, or is for another improper purpose, including, but not limited to causing unnecessary delays or needless increase in the cost of litigation; (2) conduct that is not warranted under existing law, or cannot be supported by a good faith argument for an extension, modification, or reversal or existing law, or cannot be supported by a good faith argument for the establishment of new law; or (3) conduct that consists of allegations that have no evidentiary support.” Carbone v. Nueva Construction Group, LLP, 8th Dist. Cuyahoga No. 103942, 2017-Ohio-382 par. 21, citing R.C. 2323.51(A)(2)(a).
The Fifth Appellate District addressed each of the elements. As to the first argument, that the counterclaim was not supported by evidence, the court found that counsel “permissibly relied upon the representation of its client that without the easement, it would be landlocked.” The court quoted Riston v. Butler, 149 Ohio App. 3d 390, 2002-Ohio-2308, 777 N.E. 2d 857 (1st Dist.) “it is not frivolous conduct for an attorney to reasonably reply upon the representations of his or her client.”
Addressing the next element, the court found that the counterclaim was supported by law because counsel testified in an evidentiary hearing that he filed the counterclaim to preserve the defendant’s right to the easement.
Lastly, plaintiff argued that the counterclaim was frivolous on its face because it did not sufficiently satisfy the elements for a declaratory judgment. The trial court and the court of appeals both rejected this claim, finding that defendant’s claim that it was entitled to a declaration that the easement was valid, or in the alternative was entitled to an easement by necessity, met the procedural requirements for declaratory judgment.
It is significant to note that the court found that an attorney has the right to reasonably rely on the representations of his or her client in pursuing a claim. Asserting claims on the basis of a client’s representations will not rise to the level of frivolous conduct that could result in sanctions. This result makes it difficult to pursue any claims for frivolous conduct no matter how outlandish the claims, as long as an attorney can state he relied upon the representations of the clients. While the representations must still meet the requirement that a claim is warranted either under existing law or states a good faith argument for an extension, modification, or reversal of existing law, the argument for the extension or modification or reversal of existing law is a fall back that would prevent the vast majority of courts from finding an outlandish claim rises to the level of frivolous conduct.
If you wish to obtain a copy of the decision or have any question regarding legal attorney conduct or malpractice, please call one of our Legal Professional Liability Practice Group Members.
This has been prepared for informational purposes only. It does not contain legal advice or legal opinion and should not be relied upon for individual situations. Nothing herein creates an attorney-client relationship between the Reader and Reminger. The information in this document is subject to change and the Reader should not rely on the statements in this document without first consulting legal counsel.
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