COURT OF APPEALS OF OHIO, EIGHTH DISTRICT COUNTY OF CUYAHOGA NO. 59486 SEAWAY ACCEPTANCE CORP. : PLAINTIFF-APPELLEE : JOURNAL ENTRY : v. : AND : D.F.K. INC. : OPINION DEFENDANT-APPELLANT : DATE OF ANNOUNCEMENT OF DECISION: DECEMBER 12, 1991 CHARACTER OF PROCEEDING: Civil appeal from Cleveland Municipal Court, No. 88-CVH-20647. JUDGMENT: AFFIRMED. DATE OF JOURNALIZATION: APPEARANCES: For Plaintiff-Appellee: Edward Reichek, Esq. 75 Public Square Cleveland, OH 44113 For Defendant-Appellant: Harold Pollock, Esq. 1707 Terminal Tower Cleveland, OH 44113 Donald Kirschnick, Jr., Esq. 716 Leader Building Cleveland, OH 44114 For Sol Tushman: James E. Burns, Esq. 55 Public Square Suite 2130 Cleveland, OH 44113 For U.S. Bar Inc., et al.: James Joseph, Esq. 75 Public Square Cleveland, OH 44113 -2- MATIA, P.J.: The instant cause is on appeal from the judgment of the Cleveland Municipal Court. Therein, intervening appellants Clifton Investment Services, Inc. and James M. Howard, President, moved to intervene in the Municipal Court proceedings. The trial court denied intervening-appellants' motion, and dismissed their second cause of action as moot. On review, we find no error, and affirm the judgment of the trial court. STATEMENT OF THE FACTS Intervening-appellants, Clifton Investment Services, Inc. (hereinafter "Clifton") and their President, James M. Howard (hereinafter "Howard") acted as escrow agents for the sale of a Bar in Lakewood, Ohio, owned by D.F.K. Inc., specifically Donald Krischnick, Sr. and Donald Krischnick, Jr. The buyers of the Lakewood Bar, U.S. Bar, Inc., deposited Thirty Thousand Dollars ($30,000.00) with intervening-appellant Clifton Investment Services, Inc. The sale of the Bar, however, was never completed. During the time that the money was in escrow, appellee Donald Krischnick, Jr. persuaded intervening-appellants Clifton and Howard to loan him the Thirty Thousand Dollars ($30,000.00) held in escrow. Intervening-appellants loaned appellee Krischnick, Jr. the escrow funds of Thirty Thousand Dollars ($30,000.00). In the interim, Seaway Acceptance Corporation, a prior creditor of D.F.K., Inc. took judgment against D.F.K. Inc. and -3- the Lakewood Bar. In order to execute on the judgment, Seaway requested that the Cleveland Municipal Court appoint a receiver to sell the Lakewood Bar. The Municipal Court appointed Sol Tushman as receiver. On motion by the receiver, the Municipal Court directed intervening-appellants Clifton and Howard turn over the Thirty Thousand Dollars ($30,000.00) escrow money to the receiver. Intervening-appellants Clifton and Howard could not deliver the Thirty Thousand Dollars ($30,000.00) to the receiver because appellant Howard had given the escrow money to appellee Krischnick, Jr. Consequently, the prospective buyers of the Lakewood Bar prosecuted intervening-appellant Howard in Common Pleas Court, alleging that Howard had "stolen" their money. Pursuant to this allegation, intervening-appellant Howard was indicted for grand theft. Intervening-appellants Clifton and Howard filed a two count action in the Cuyahoga County Court of Common Pleas against the receiver and D.F.K., Inc. Count one of the action was in interpleader asking the court to determine the proper party to receive the Thirty Thousand Dollars ($30,000.00) it held in escrow. Upon motion of the receiver, the Court of Common Pleas found that the Cleveland Municipal Court had jurisdiction over the res of count one and instructed the clerk to deliver the Thirty Thousand Dollars ($30,000.00) interpled to the receiver, per the prior order of the Cleveland Municipal Court. -4- Subsequently, the criminal charge against Howard was nolled when he interpled the Thirty Thousand Dollars ($30,000.00) into the Court of Common Pleas. At about the same time, appellee Krischnick, Jr. repaid intervening-appellant Howard the Thirty Thousand Dollars ($30,000.00) as a consequence of Howard's judgment against him. Intervening-appellants Clifton and Howard then motioned the Municipal Court to intervene in the Municipal Court proceedings regarding the sale of the bar assets. The Municipal Court overruled intervening-appellants motion to intervene, and later overruled intervening-appellants' motion to remove receiver as moot. It is from the Municipal Court's denial of the motion to intervene, appellants timely appeal. ASSIGNMENT OF ERROR I "THE TRIAL COURT ERRED IN DENYING APPELLANTS' MOTION TO INTERVENE WHERE APPELLANTS SATISFIED THE REQUIREMENTS FOR INTERVENTION AS SET FORTH IN CIVIL RULE 24 OF THE OHIO RULES OF CIVIL PROCEDURE." Appellants argue in their first assignment of error that the Municipal Court erred in denying their motion to intervene. Specifically, appellants argue that they met the requirements needed to intervene as parties to the proceeding. This assignment of error is not well taken. -5- ISSUE: WHETHER INTERVENING-APPELLANTS WERE PROPER PARTIES TO THE ACTION Rule 24 of the Ohio Rules of Civil Procedure governs intervention in litigation. The Rule states, in pertinent part, as follows: "Rule 24. Intervention "(A) Intervention of right. Upon timely application anyone shall be permitted to intervene in an action: *** or (2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and he is so situated that the disposition of the action may as a practical matter impair or impede his ability to protect that interest, unless the applicant's interest is adequately represented by existing parties. "(B) Permissive intervention. Upon timely application anyone may be permitted to intervene in an action: *** or (2) when an applicant's claim or defense and the main action have a question of law or fact in common. "(C) Procedure. A person desiring to intervene shall serve a motion to intervene upon the parties as provided in Rule 5. The motion shall state the grounds therefor and shall be accompanied by a pleading setting forth the claim or defense for which intervention is sought." (Emphasis added.) An intervention of right and permissive intervention is conditioned by Civ. R. 24(C) which requires that a party desiring to intervene must state the grounds therefor and the pleading must set forth the claim or defense on its face. A review of the record shows that appellants Clifton and Howard did not set forth a claim to intervene. -6- Movants escrow agents Clifton and Howard asserted in their brief that their interest in the matter could not be adequately protected by any of the other parties to the action. Movants, however, never made a clear statement as to what their interest was. We note that intervening appellants Clifton and Howard, acting as escrow agents in the aborted bar sale of January 1988, filed a complaint as interpleader and for declaratory judgment with the Court of Common Pleas requesting the court to determine the rights and obligations of the parties to the contract of January 28, 1988, and to discharge them as escrow agent under the contract. Upon filing their complaint, appellants Clifton and Howard deposited with the court the sum of Thirty Thousand Dollars ($30,000.00) which appellants had previously held in escrow under the January 1988 contract. On January 3, 1989, the court by judgment entry approved the referee's finding that the Thirty Thousand Dollars ($30,000.00) should be turned over to the court appointed receiver relieving appellants Clifton and Howard of their interest in the Municipal Court proceeding. We further note that appellants Clifton's and Howard's judgment against appellees Donald Kirschnick, Sr. and Donald Kirschnick, Jr. was subsequently satisfied. We conclude then that once appellants Clifton and Howard turned over the $30,000.00 sum it held in escrow which was repaid by Krischnick, Jr., appellants' status as proper parties to the lawsuit ended. Thus, appellants Clifton and Howard cannot -7- demonstrate "any right to relief jointly or severally, or in the alternative, in respect of or arising out of the same transaction." Civ. R. 20(A). ISSUE: WHETHER INTEREST IN RECEIVING ATTORNEY FEES MADE APPELLANTS PROPER PARTIES TO INTERVENE Appellants Clifton and Howard asserted in their brief in support of their motion to intervene that their interest as a party concerned the approximately Thirty Thousand Dollars ($30,000.00) in legal fees appellants incurred in defending against criminal charges stemming from the funds held in escrow, and also in pursuing Donald Krischnick, Jr. for reimbursement of the Thirty Thousand Dollars ($30,000.00) appellants deposited with the Common Pleas Court. We agree with the Common Pleas Court that this interest does not make appellants proper parties to intervene in the within action. When appellants interpled the escrow sum to the Court of Common Pleas, their identified interest in the property or transaction which was the subject of the within action was extinguished. Divot v. State of Ohio (1985), Cuyahoga County No. 48965, unreported. Accordingly, appellants Clifton and Howard have no right under Civ. R. 24 to intervene as proper parties. (Civ. R. 20(A)). See Dean v. Harshaw/Filtrol Partnership (1988), 55 Ohio App. 3d 67. Like the appellant in Dean, the appellants in this matter are at best general unsecured creditors of D.F.K. Inc. Accordingly, Assignment of Error I is without merit. -8- ASSIGNMENT OF ERROR II "THE TRIAL COURT ERRED IN FAILING TO GRANT APPELLANTS' MOTION TO REMOVE THE RECEIVER FOR CAUSE WHERE THE RECEIVER HAD ACTED EITHER FRAUDULENTLY OR NEGLIGENTLY, BY (A) VIOLATING HIS CHARGE 'TO OBTAIN THE BEST PRICE OBTAINABLE' FOR THE BUSINESS FOR WHICH HE HAD BEEN APPOINTED RECEIVER, (B) BY FAILING TO DISCLOSE THE EXISTENCE OF A PREVIOUS CONTRACT TO THE CLEVELAND MUNICIPAL COURT IN SEEKING APPROVAL FOR A PRIVATE SALE TO THE SAME PERSONS, (C) BY MAKING FALSE AND MISLEADING STATEMENTS IN A MOTION AND JUDGMENT ENTRY FILED WITH THE CLEVELAND MUNICIPAL COURT, (D) BY AUTHORIZING THIRD PERSONS TO OPERATE THE BUSINESS FOR WHICH HE WAS APPOINTED RECEIVER WHERE HE HAD NO AUTHORITY TO OPERATE THE BUSINESS, AND (E) BY FAILING TO OBTAIN ANY ACCOUNTING FROM THE PERSONS WHOM HE HAD PERMITTED TO OPERATE THE BAR BUSINESS." Intervening-appellants argue in their second assignment of error that the trial court erred in failing to grant their motion to remove the receiver for cause. Specifically, appellants argue that they had standing to pursue a complaint in the within action. This assignment of error is not well taken. ISSUE: WHETHER APPELLANTS WERE PRECLUDED FROM MOVING THE COURT TO REMOVE THE RECEIVER The Cleveland Municipal Court denied intervening-appellants' motion to remove the receiver as moot. We conclude that the court rendered that judgment pursuant to its denying appellants' motion to intervene as new parties. Absent standing as parties to the lawsuit, appellants had no legal right to set judicial machinery in motion. Accordingly, we find no error in the trial court's disposition of intervening-appellants' motion. -9- Accordingly, and for the foregoing reasons, the trial court is affirmed. is affirmed. It is ordered that appellee recover of appellants its costs herein taxed. The court finds there were reasonable grounds for this appeal. It is ordered that a special mandate issue out of this court directing the Cleveland Municipal Court to carry this judgment into execution. A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of the Rules of Appellate Procedure. Exceptions. FRANCIS E. SWEENEY, J. and BLACKMON, J., CONCUR. DAVID T. MATIA PRESIDING JUDGE N.B. This entry is made pursuant to the third sentence of Rule 22(D), Ohio Rules of Appellate Procedure. This is an announcement of decision (see Rule 26). Ten (10) days from the date hereof this document will be stamped to indicate journalization, at which time it will become the judgment and order of the court and time period for review will begin to run. .