COURT OF APPEALS OF OHIO, EIGHTH DISTRICT COUNTY OF CUYAHOGA NO. 71042 MICHAEL W. STILLMAN : : Plaintiff-appellant : : JOURNAL ENTRY -vs- : AND : OPINION LAURIE M. MURRAY, ET AL. : : Defendants-appellees : : DATE OF ANNOUNCEMENT OF DECISION: APRIL 24, 1997 CHARACTER OF PROCEEDING: Civil appeal from Court of Common Pleas Case No. CV-255164 JUDGMENT: Affirmed. DATE OF JOURNALIZATION: APPEARANCES: For Plaintiff-Appellant: For Defendants-Appellees: JOHN C. MEROS, ESQ. EUGENE B. MEADOR, ESQ. SCHULMAN, SCHULMAN & MEROS KITCHEN, DEERY & BARNHOUSE 1370 Ontario Street 55 Public Square 1700 Standard Building 1100 Illuminating Building Cleveland, Ohio 44113-1727 Cleveland, Ohio 44113 - 2 - DYKE, J.: Appellant and appellee, Laurie Murray, were involved in an automobile accident in which appellant was injured. Appellant filed a personal injury suit within two years following the accident. Appellant sustained damage to a specialized apparatus which was surgically attached to his spine to alleviate back pain. He settled with Murray for $50,000.00, the limits of her liability insurance. An arbitration hearing was held to determine appellant's insurance carrier's liability under the underinsured motorist provision of appellant's coverage. The arbitration panel awarded appellant $350,000.00. The limits of his underinsured motorist coverage with appellee Grange Mutual Casualty Company ("Grange") is $250,000.00. A trial court affirmed the arbitration award. A timely motion for prejudgment interest was filed against appellee following the court's affirmance of the award. The motion was granted without a hearing. Both parties to the motion contested the court's judgment entry as void without holding the requisite hearing. Upon a remand from this Court, the trial court held a hearing on the prejudgment interest motion. The court denied the motion after the hearing. Appellant filed a timely appeal from the court's denial of the motion for prejudgment interest, asserting the following two assignments of error. - 3 - I THE TRIAL COURT ERRED TO THE SUBSTANTIAL PREJUDICE OF PLAINTIFF/APPELLANT IN DENYING PLAINTIFF/APPELLANT'S MOTION FOR PREJUDGMENT INTEREST, AS PLAINTIFF/APPELLANT HAD A COMMON LAW RIGHT TO PREJUDGMENT INTEREST TO BE MADE "WHOLE" AS A RESULT OF HIS INJURIES. II THE TRIAL COURT ERRED TO THE SUBSTANTIAL PREJUDICE OF PLAINTIFF/APPELLANT IN DENYING PLAINTIFF/APPELLANT'S MOTION FOR PREJUDGMENT INTEREST UNDER R.C. 1343.03(C). Because both of the assignments of error are interrelated, we will review their merits together. Appellant argues that the prejudgment interest should have been granted because he was entitled to the money for the purpose of making him whole. Appellant claims that the $350,000.00 award made by the arbitration panel is the amount which would make him whole. He received $50,000.00 from the tortfeasor and $250,000.00 from his insurance carrier, leaving him $50,000.00 less than whole. This is not a relevant basis for awarding prejudgment interest. Although the Ohio Supreme Court has recognized that prejudgment interest was a common law right in this state, it is now awarded pursuant to the provisions of R.C. 1343.03(C). Moskovitz v. Mt. Sinai Med. Ctr. (1994), 69 Ohio St.3d 638. Under the statutory provisions, four requirements must be met. First, a motion must be timely filed. Secondly, the trial court must hold a hearing. Third, "the court must find that the party required to pay the judgment failed to make a good faith effort to settle and, fourth, the court must find that the party to whom the - 4 - judgment is to be paid did not fail to make a good faith effort to settle the case." Moskovitz v. Mt. Sinai Med. Ctr. (1994), 69 Ohio St.3d 638, 658. Appellant asserts that appellee Grange failed to make a good faith effort to settle, therefore prejudgment interest should have been awarded. Appellant's assertion is not well taken. The trial court held as follows in its journal entry denying appellant's motion: Based upon ORC 1343.03(C) and as further refined in Kalain v. Smith (1986), 25 Ohio St.3d 157 this court finds that, in view of all testimony adduced, the instant case presented difficulties to both plaintiff and defense and, further, that the delays in evaluation and settlement attendant thereto reflect that difficulty, and further [defendant] Grange did not fail to make a good faith effort to settle. (Journal entry dated July 11, 1996). The decision as to whether the party required to pay the judgment has failed to make a good faith effort to settle is within the sound discretion of the trial court. Kalain v. Smith (1986), 25 Ohio St.3d 157 and Moskovitz v. Mt. Sinai Med. Ctr. (1994), 69 Ohio St.3d 638. Absent an abuse of this discretion, this Court will not overrule the trial court's ruling. The Ohio Supreme Court has offered some guidance to courts in determining the issue of good faith when reviewing motions for prejudgment interest. The Ohio Supreme Court held that: A party has not "failed to make a good faith effort to settle" under R.C. 1343.03(C) if he has (1) fully cooperated in discovery proceedings, (2) rationally evaluated his risks and potential liability, (3) not attempted to unnecessarily delay any of the proceedings, - 5 - and (4) made a good faith monetary settlement offer or responded in good faith to an offer from the other party. If a party has a good faith, objectively reasonable belief that he has no liability, he need not make a monetary settlement offer. Kalain v. Smith, supra, at 159. Appellant claimed that appellee failed to rationally evaluate its potential liability and it did not offer a monetary settlement until the day prior to the arbitration hearing. Upon a careful review of the record, we find objective evidence of the reasonableness of appellee's belief that it had no liability for appellant's injury. The medical records of appellant's longstanding back problems indicated that appellant had experienced pain subsequent to the implantation of the device which was allegedly damaged by the impact of the automobile accident. Appellee sought advice from its medical expert to determine its liability for appellant's continuing back pain. The evidence pointing to appellee's potential liability was questionable, after rationally evaluating the medical records and expert reports. We agree with the trial court that the instant case presented unique evidentiary difficulties for both parties. We further agree that appellee rationally evaluated its potential liability and had a reasonable belief that it was not liable. With such an objectively reasonable belief, a monetary settlement offer is not required, under Kalain v. Smith, supra. Appellant's first and second assignment of errors are overruled. - 6 - We find that the trial court did not abuse its discretion in finding that the appellee did not fail to make a good faith effort to settle. We therefore affirm the court's denial of appellant's motion for prejudgment interest. - 7 - 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 Court of Common Pleas 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. DAVID T. MATIA, P.J., AND *PRYATEL, J., CONCUR ANN DYKE JUDGE *Sitting By Assignment: Judge August Pryatel, Retired, of the Eighth District Court of Appeals. N.B. This entry is an announcement of the court's decision. See App.R. 22(B), 22(D) and 26(A); Loc.App.R. 27. This decision will be journalized and will become the judgment and order of the court pursuant to App.R. 22(E) unless a motion for reconsideration with supporting brief, per App.R. 26(A), is filed within ten (10) days of the announcement of the court's decision. The time period for review by the Supreme Court of Ohio shall begin to run upon the journalization of this court's announcement of decision by the .