COURT OF APPEALS OF OHIO, EIGHTH DISTRICT COUNTY OF CUYAHOGA NO. 60934 SHAKER AUTO LEASE, INC. : : : PLAINTIFF-APPELLEE : JOURNAL ENTRY : v. : AND : : OPINION JAVITCH & EISEN, AKA : JAVITCH & EISEN CO., L.P.A. : : DEFENDANT-APPELLANT : DATE OF ANNOUNCEMENT OF DECISION: JULY 30, 1992 CHARACTER OF PROCEEDING: Civil appeal from Bedford Municipal Court, Case No. 86 CVF 4570. JUDGMENT: AFFIRMED. DATE OF JOURNALIZATION: APPEARANCES: For Plaintiff-appellee: Howard S. Stern Steiner & Stern Co., L.P.A. 75 Public Square, #1400 Cleveland, Ohio 44113-2001 For Defendant-appellant: Richard Zuckerman Javitch & Eisen Co., L.P.A. 1050 Statler Office Tower Cleveland, Ohio 44115 - 2 - SWEENEY, JAMES D., J.: Defendant-appellant Javitch & Eisen, aka Javitch & Eisen Co., L.P.A., filed this appeal subsequent to a bench trial which awarded judgment for plaintiff-appellee Shaker Auto Lease, Inc. on both the complaint and the counterclaim. Appellee filed suit on a motor vehicle lease and appellant counterclaimed for damages under the Consumer Sales Practice Act, R.C. 1345.01 et seq. Appellant also filed a third party complaint against the manufacturer of the vehicle based on express and implied warranties, R.C. 1302.26, 1302.27 and 1302.28. The third party defendant's motion to dismiss was granted, and is not the subject of this appeal. On January 13, 1984, appellant leased from appellee a 1984 Audi 5000 S vehicle for commercial and business use. Appellant paid $462.24 a month on the lease, until September, 1986. On September 22, 1986, appellant informed appellee by letter that: I am attempting, with due diligence, to sell the 1984 Audi, which was leased from your company. I will continue this attempt until the end of September, 1986. However, if I cannot consummate a sale by that time, it is my intention to return the vehicle to you, and, if necessary, pursue my remedies against Bedford Porsche-Audi, Audi Motor Cars, and you. (Trial Exhibit 1.) Appellant placed the car at Crestmont Cadillac for sale and while there it caught on fire. Appellant notified appellee by letter on October 14, 1986, that when repairs were completed on the car, appellee could reclaim the vehicle, and that appellant would not - 3 - take possession of it again. (Tr. Ex. 2.) A dispute arose as to what was due and owing under the lease contract, and on December 11, 1986, appellee filed suit. Section 10 of the lease agreement specifies the parties rights upon the default of the lessee; and section 11 delineates the lessee's right to terminate the contract. 10. DEFAULT. in the event Lessee shall default in any payment required hereunder or in the performance of any other covenant or agreement on its part to be performed, or in the event Lessee shall be adjudicated bankrupt, or make assignment for benefit of its creditors, or a receiver shall be appointed of its business, or if it shall suffer any attachment or execution to be levied against it (sic) property, then, and in any such event, Lessor may, at its election, sue for and collect the rents or other accounts for which Lessee may be in default, or retake the vehicle and rent such vehicle to another or others charging Lessee with any deficiency between the amount so realized and the amount due from Lessee, or terminate this Lease and retake the vehicle, reserving full right to sue for and collect all rents and other amounts due to the date of such termination, including damages to Lessor by reason of such breach or Lessor may pursue any other remedy now or hereafter existing at law or in equity. Lessee shall pay Lessor all costs and expenses including attorney fees, incurred by Lessor in exercising any of its rights or remedies hereunder and notwithstanding any such action taken by Lessor, Lessee shall remain liable for the full performance of all of Lessee's obligations hereunder. 11. TERMINATION RIGHTS: (a) The Lessee may cancel this lease as to any vehicle at any time after making fifty percent (50%) of the rental payments due hereunder upon five (5) days' notice, - 4 - provided Lessee, upon such cancellation, shall pay Lessor liquidated damages equivalent to six (6) monthly rental payments, or the number of months remaining in the lease period, if it be less than six (6) months. (b) Lessor may recall and withdraw any leased vehicle at any time if the vehicle shows signs of having been subjected to abuse, or if the vehicle has been used in violation of the terms of the agreement, or if Lessee shall violate this agreement in any particular, or if the rental due hereunder is more than 45 days in arrears. (c) Upon termination Lessee will return the leased vehicle to the Lessor's Cleveland office or will pay all costs for having vehicles returned. Trial commenced on October 22, 1990, at which time appellee presented the testimony of its employee Stanley Davis. Mr. Davis testified that appellant was a long-time customer and that the first time he was aware that appellant was experiencing difficulties with the Audi was by way of a telephone call from Mr. Javitch in September, 1986. Mr. Davis also testified that he viewed appellant's letters as a termination under the contract, and calculated damages accordingly. Testimony was elicited which indicated that after subtracting the amount the vehicle was ultimately sold for, $8,500.00, from the balance of the contract price, the result would be within three dollars of the amount prayed for by appellee under the termination clause of the contract. Mr. Davis testified that the similarity of the two figures was a coincidence. - 5 - Mr. Javitch took the stand on behalf of the appellant, and testified to the innumerable difficulties he experienced with the Audi. He stated that he abandoned his obligations under the lease because the defects in the car were too substantial to continue driving it (T. 53). He testified that he had not informed appellee earlier about the deficiencies of the vehicle because he knew, under the lease, that he was responsible for any repairs. On cross examination he admitted that the letters he sent to appellee do not state that appellant refused to make further lease payments; and that he believed he could return the car and walk away (T. 65). Mr. Javitch opined that section 11 of the lease did not apply to the present situation as he was not voluntarily terminating the lease. He characterized his actions as abandoning the lease (T. 66), and believed the situation should be covered under section 10 of the lease (T. 68). The trial judge rendered a verdict for the appellee in the sum of $3,391.74 and also ruled in favor of the appellee on the counterclaim. Appellant presents two assignments of error for review. Appellant's first assignment of error. I THE TRIAL COURT ERRED WHEN IT FAILED TO CONSIDER APPELLANT'S CLAIM OF BREACH OF IMPLIED WARRANTY OF MERCHANTABILITY. Appellant argues that the trial court failed to consider its claim of breach of the warranty of merchantability, R.C. 1302.27. - 6 - There is, however, no evidence that the judge failed to consider appellant's argument. On October 30, 1990, both parties were notified that the court would render judgment in favor of appellee both on the complaint and the counterclaim. The notice also informed the litigants that, within seven days, findings of fact and conclusions of law could be requested pursuant to Civ. R. 52. No request having been made, the court entered final judgment on November 19, 1990. There is no indication in the judgment which arguments the judge found persuasive, or why, and appellant did not utilize the procedure provided in the Civil Rules for obtaining this information. Absent any indication to the contrary, the court of appeals will assume the trial court knew, and applied, the correct legal principles. What appellant has essentially argues is the trial court's decision was against the manifest weight of the evidence. Where an award is supported by competent, credible, evidence, the trial court will not be reversed. The trial court should be given the presumption of correctness. Seasons Coal Co. v. Cleveland (1984), 10 Ohio St. 3d 77. And, as set forth in the syllabus of Pettet v. Pettet (1988), 55 Ohio App. 3d 128: Where an appealing party challenges the findings of the trial court on the basis that such findings are not supported by the weight of the evidence, and separate findings of fact and conclusions of law were neither requested by the parties nor supplied by the trial court, the reviewing court is bound to affirm if, - 7 - from an examination of the record as a whole, there is some evidence from which the trial court could have reached the ultimate factual conclusions supporting the judgment. In order to disclaim the implied warranty of merchantability, the language must mention merchantability, and be conspicuous if in writing. R.C. 1302.29, Allis-Chalmers v. Herbolt (1984), 17 Ohio App. 3d 230. A buyer who has accepted goods must, within a reasonable time after he discovers, or should have discovered, any breach, notify the seller or be barred from any remedy. R.C. 1302.65. Seasons Coal Co., supra. The determination of what constitutes a reasonable time is a question of fact. Chemtrol Adhesives, Inc. v. American Mfrs. Mut. Ins. Co. (1989) 42 Ohio St. 3d 40 at 51. In the case sub judice, the lease contract does not disclaim the warranty of merchantability as the requirements of R.C. 1302.29 were not met. However, there was evidence in the record that appellant did not notify the appellee of the defects in the automobile within a reasonable time after discovery. Appellant was barred from asserting the warranty of merchantability pursuant to R.C. 1302.65. Appellant's first assignment of error is overruled. Appellant's second assignment of error. II THE TRIAL COURT ERRED WHEN IT AWARDED SHAKER AUTO LEASE A REMEDY NOT AVAILABLE TO APPELLEE UNDER THE TERMS OF THE LEASE. - 8 - Appellant argues that, in essence, it defaulted on the lease contract and the only damages available to appellee are under section 10 of the contract. Appellant characterizes its actions as an abandonment of the lease (T. 53). We disagree. Appellant's letter of September 22, 1986 to appellee explicitly sets forth appellant's intent to either sell the vehicle or return it to the appellee. This letter is a termination pursuant to section 11 of the contract. The appellant had made more than fifty percent of the rental payments, and appellee was given more than five days notice. Appellant should have tendered the six months of payments to appellee, but since that did not occur, appellee was within its right to sue for the breach. Appellant's actions were not an abandonment, or default, on the contract. Appellant's second assignment of error is overruled. Judgment affirmed. - 9 - It is ordered that appellee recover of appellant 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 Bedford 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. ANN DYKE, P.J., and FRANCIS E. SWEENEY, J., CONCUR. JAMES D. SWEENEY 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. .