COURT OF APPEALS OF OHIO, EIGHTH DISTRICT COUNTY OF CUYAHOGA NO. 68954 Z. GEORGE POTCHEN : : Plaintiff-appellant : : JOURNAL ENTRY -vs- : AND : OPINION JOHN E. HUGHES, ET AL. : : Defendant-appellees : : DATE OF ANNOUNCEMENT : FEBRUARY 22, 1996 OF DECISION : CHARACTER OF PROCEEDING : Civil appeal from Cleveland Municipal : Case No. 95-CVG-197 JUDGMENT : REVERSED AND REMANDED DATE OF JOURNALIZATION : APPEARANCES: For plaintiff-appellant: For defendant-appellees: CHRISTOPHER HORN, ESQ. ROBERT C. BAILES, ESQ. 3122 Euclid Avenue 9391 Mentor Avenue, Suite 312 Cleveland, OH 44115 Mentor, OH 44060 MARY BIACSI, ESQ. 1040 The Leader Bldg. 526 Superior Aveneue Cleveland, OH 44114-2803 - 2 - PATTON, J. Landlord-appellant Z. George Potchen filed this forcible entry and detainer action with the Cleveland Municipal Court, Housing Division, alleging defendant-tenants John and Kelly Hughes ("Hughes") violated the terms of a co-tenancy agreement and seeking their eviction from the premises. The housing court issued judgment for the Hugheses, apparently finding an arbitration clause in the co-tenancy agreement controlled disposition of the matter. The landlord appeals, claiming the housing court erred by dismissing the forcible entry and detainer action in favor of the arbitration clause. The record shows the landlord and the Hugheses entered into a co-tenancy agreement pertaining to a house in the city of Cleveland. The agreement provided the landlord would execute a warranty deed for an undivided fifty percent interest in the property upon the Hugheses acceptance to specified terms and conditions of the agreement and the lease agreement. The co-tenancy agreement contained the following arbitration clause: "In the case of any controversy between the CO- INVESTOR [Hugheses] and INVESTOR [landlord] concerning, but not limited to, the validity, construction, or interpretation of the Agreement, or the validity of the appraisal, the parties shall refer such dispute in writing to an Arbitrator to be jointly agreed upon. Or failing an agreement, to the American Arbitration Association for referral to a single arbitrator. *** The decision of the arbitrator shall be final and binding on both - 3 - parties and shall be enforceable as any Arbitration award. ***" The lease agreement also provided for arbitration "should any disagreement arise between the parties hereto concerning the demised premises, this lease, or the rights and duties of either in relation thereto ***." The landlord's complaint alleged the Hugheses owed $1,337.02 and that the landlord had served notice demanding payment or requesting the Hugheses to vacate the premises. Kelly Hughes answered the complaint, denying the substantive allegations of the complaint. Further, she filed a cross-claim for indemnity against John Hughes, alleging she and Hughes were divorced and the divorce decree required John Hughes to hold her harmless on the co-tenancy agreement. John Hughes did not appear in the action nor has he filed a brief in this court. The housing court referred the matter to a referee who recommended the court render judgment for the Hugheses. The judgment entry stated, "[Hughes] is co-owner with [landlord]. No jurisdiction." The landlord objected to the referee's report, claiming the tenant had no interest in the property. He appended a copy of the deed showing his exclusive ownership of the property as an exhibit to his objections. He maintained the Hugheses had the right to become a co-owner of the property if the Hugheses complied with the terms of the agreement, but those terms had not been fulfilled. - 4 - After conducting an oral hearing on the landlord's objections, the trial court approved the referee's report, stating, "Based upon evidence presented and arbitration clause in contract and lease, Referee's report is approved and confirmed. Judgment for defendants on plaintiff's complaint." The landlord's four assigned errors collectively challenge the housing court's authority to use the arbitration clause as a basis for granting judgment to the Hugheses. He claims the summary nature of a forcible entry and detainer action supersedes any agreement to arbitrate differences in the co-tenancy agreement. Moreover, he argues his own failure to raise the arbitration clause at any point in the proceedings constituted a waiver of any right to raise arbitration as a defense, and that waiver could not be corrected on the housing court's own initiative. R.C. 2711.01 provides the right to contract for arbitration and the means for enforcing arbitration agreements. However, R.C. 2711.01(B) specifically states it does not apply to controversies involving the title to or possession of real estate unless the controversy involves the amount of rentals due under any lease. See R.C. 2711.01(B)(1)(b). We have considered the issue whether an arbitration clause in a lease agreement would supersede the forcible entry and detainer remedy in a similar situation. In T Building Company v. Frocks & Bonnets, Inc. (Oct. 16, 1986), Cuyahoga App. No. 51050, unreported, a lessor and lessee agreed to terms on a lease. Upon expiration of - 5 - the lease period, the agreement provided the lessee had the option to renew the lease on terms that would be subsequently agreed to by the parties. In the event the parties could not agree on rent, the matter would be submitted to arbitration. The lessor brought a forcible entry and detainer action after, among other things, the lessee had failed to pay the final three months rent under the original term of the lease. The lessee argued the court should have granted its motion to stay the forcible entry and detainer action and submit the matter to arbitration. We found R.C. 2711.01(B)(1)(b) did not apply since there was no dispute as to the amount of rentals due under the original lease term; the dispute simply centered on the lessee's failure to pay those rentals. Id. at 8. In this case, there is likewise no dispute as to the amount of the past rent due. In fact, John Hughes has neither appeared in the action nor denied the allegations of the complaint. Since this is not a controversy over the amount of rent due, R.C. 2711.01(B)(1)(b) would not apply and the housing court erred by entering judgment for the Hugheses and, by implication, ordering the parties to submit the matter to arbitration. Accordingly, we sustain the first assignment of error and remand to the housing court for further proceedings. - 6 - This cause is reversed and remanded to the lower court for further proceedings consistent with this opinion. It is, therefore, considered that said appellant recover of said appellees his costs herein. It is ordered that a special mandate be sent to said 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. BLACKMON, P.J. DAVID T. MATIA, J., CONCUR JUDGE JOHN T. PATTON N.B. This entry is made pursuant to the third sentence of Rule 22(D), Ohio Rules of Appellate Procedure. This is an announce- ment of decision (see Rule 26). Ten (10) days from the date hereof, this document will be stamped to indicate journalization, .