The opinion
[Cite as Momentum Freight Logistics Corp. v. Benie Logistics, Inc., 2025-Ohio-5738.]
IN THE COURT OF APPEALS OF OHIO
TENTH APPELLATE DISTRICT
Momentum Freight Logistics Corp., :
No. 24AP-263
Plaintiff-Appellee, : (C.P.C. No. 21CV-5528)
v. : (REGULAR CALENDAR)
Benie Logistics Inc. et al., :
Defendants-Appellants. :
D E C I S I O N
Rendered on December 23, 2025
On brief: Critchfield, Critchfield & Johnston, Ltd., Samuel J.
Webber, and Amanda E. Webber for appellee. Argued:
Amanda E. Webber.
On brief: Choken Welling LLP, and David A. Welling for
appellants. Argued: David A. Welling.
APPEAL from the Franklin County Court of Common Pleas
MENTEL, J.
{¶ 1} Defendants-appellants, Benie Logistics, Inc. (“Benie”), Elizabeth Dawson,
and Russell Dawson (collectively “appellants”), appeal from a judgment of the Franklin
County Court of Common Pleas entered in favor of plaintiff-appellee, Momentum Freight
Logistics Corporation (“Momentum”). For the reasons that follow, we affirm.
I. Facts and Procedural History
{¶ 2} On September 1, 2021, Momentum filed a complaint against Benie alleging
claims for breach of contract, unjust enrichment, civil theft, and conversion. The events
No. 24AP-263 2
giving rise to the complaint stemmed from Benie’s agreement to purchase Momentum’s
FedEx trucking and delivery business located in Mansfield, Ohio.
{¶ 3} Momentum and Benie entered into an Asset Purchase Agreement (“APA”) on
June 1, 2020, whereby Momentum agreed to sell its FedEx trucking and delivery business
to Benie for $1.675 million. Section 1.2 of the APA identified certain assets as “Excluded
Assets” that Momentum would not convey to Benie in the sale. (Compl. Ex. A, APA at §
1.2.) Pertinent to the present appeal, the Excluded Assets included the following item:
In the event that Buyer assumes Seller’s Ohio Workers’
Compensation policy, Policy Number: 1519862, Buyer agrees
that the Workers’ Compensation premium dividend
reimbursement, for the Policy Period 07/01/2019 -
07/01/2020 and for the Policy Period 07/01/2020 -
07/01/2021, if any, prorated for the months Seller was in
operation, shall be provided to seller in a timely fashion.
(Compl. Ex. A, APA at § 1.2.7.)
{¶ 4} James Homer, the president of Momentum, and Elizabeth Dawson, the
president of Benie, executed the APA on behalf of their respective companies. The APA did
not contain any personal guarantees. Elizabeth and her husband, Russell Dawson, were
the sole shareholders of Benie; Russell also served as Benie’s secretary and treasurer.
{¶ 5} Before the parties closed on the sale of the business, they agreed Benie would
assume Momentum’s Bureau of Workers’ Compensation (“BWC”) policy. As such, in late
July of 2020, the parties executed BWC form U-118 to effectuate the transfer of the policy.
The form identified Momentum with BWC policy number 01519862 as the former
employer, and Benie with BWC policy number 80079456 as the succeeding employer. The
BWC approved the transfer and Benie assumed BWC policy number 01519862.
Momentum sold its business to Benie effective August 28, 2020.
{¶ 6} On October 21, 2020, Mr. Homer sent Elizabeth an email stating the BWC
had announced it was “issuing policy dividends (reimbursements) for the premiums paid
for the 2019 policy year (July 1, 2019 – June 3[0], 2020).” (Trial Ex. D.) Mr. Homer noted
the BWC would mail the dividend check to Benie, and he asked Elizabeth to either “write
[him] a check or send [him] a wire for the dividend amount.” (Trial Ex. D.) The BWC
issued a policy holder dividend to Benie in the amount of $69,269 on October 22, 2020.
No. 24AP-263 3
Mr. Homer sent Elizabeth another email on November 11, 2020, noting the BWC confirmed
it mailed the dividend check to Benie on October 30, 2020.
{¶ 7} Elizabeth responded to Mr. Homer on November 13, 2020, stating that Benie
“ha[d] not received anything yet.” (Trial Ex. D.) Elizabeth believed the BWC would mail
the check to her home address in Texas, but the BWC mailed the check to Benie’s business
address in Ohio and the check “was lost at the [FedEx] terminal.” (Sept. 18, 2023 Tr. Vol.
1 at 90.) Mr. Homer contacted the BWC to inquire about the lost check. In response to Mr.
Homer’s inquiry, the BWC reversed and reissued the $69,269 dividend check to Benie in
early December 2020. (Tr. Vol. 1 at 22; Trial Ex. I.)
{¶ 8} On December 7, 2020, the BWC mailed the $69,269 dividend check to Benie.
The letter attached to the December 7, 2020 check simply stated if Benie had any question
regarding the payment to contact the BWC. On December 10, 2020, the BWC sent Benie
another dividend check in the amount of $257,999.32. The letter attached to the
December 10, 2020 check stated the enclosed check was “part of [the BWC’s] $5 billion
dividend for Ohio’s private and public employers covered by the state insurance fund. As
Gov. DeWine said when he announced the dividend in October, ‘[t]his is about keeping
businesses open and people employed.’ ” (Trial Ex. O.) The letter informed the employer
the check was “[theirs] to spend as [they] wish,” although the BWC encouraged employers
to “invest in the health and safety of your most important asset – your people.” (Trial Ex.
O.)
{¶ 9} The BWC also issued Frequently Asked Questions for Employers (“FAQs”)
with both checks. The FAQs indicated the $69,269 check “[w]as 100% of billed premium
for eligible employers for the policy period of July 1, 2019, through June 30, 2020” (i.e., the
“2019 policy period”), and that the $257,999.32 check “[w]as 372% of billed premium for
eligible employers for the [2019] policy period.” (Trial Ex. E; Trial Ex. G.) To receive either
check, an employer had to satisfy the following criteria: (1) be a State Insurance Fund
employer, (2) have reported payroll greater than zero for the 2019 policy period, (3) have
been billed premium for the 2019 policy period, (4) have completed their payroll true-up
for the 2019 policy period, and (5) be in “active, reinstated, combined, cancelled – business
sold, or debtor-in-possession status or, in a lapsed status with a lapse date of Jan. 1, 2020
or later as of Oct. 2, 2020.” (Trial Ex. E; Trial Ex. G.) For an employer who assumed
No. 24AP-263 4
another employer’s BWC policy, the FAQs stated the BWC would “determine eligibility
based on the status of the predecessor policy. If the predecessor policy would have been
eligible for the dividend, the successor [would] receive the applicable dividend.” (Trial Ex.
E.)
{¶ 10} Momentum satisfied the criteria necessary to receive both the $69,269.00
and $257,999.32 dividend checks from the BWC. (Tr. Vol. 1 at 16, 26, 28; Trial Ex. II; Trial
Ex. LL.) Although Benie did not satisfy the eligibility criteria for either check, because Benie
acquired Momentum’s BWC policy and Momentum was eligible to receive the checks,
Benie was entitled to receive the checks from the BWC.
{¶ 11} On December 12, 2020, Mr. Homer sent Elizabeth an email asking whether
she had “received the two Worker[s’] Compensation policy dividend checks owed to
Momentum Freight” pursuant to “paragraph 1.2.7” of the APA. (Trial Ex. D.) Elizabeth
responded on December 13, 2020, stating the Dawsons had “not been back to Texas to
confirm that [the checks were] received. We will let you know after we return.” (Trial Ex.
D.) On December 29, 2020, Mr. Homer sent Elizabeth another email regarding the “BWC
policy dividend checks,” noting the parties needed “resolution on this very shortly.” (Trial
Ex. D.) Momentum’s attorney sent Benie a letter demanding payment of the $69,269 and
$257,999.32 BWC dividend checks on January 12, 2021.
{¶ 12} On January 27, 2021, appellants’ counsel sent a letter responding to
Momentum’s demand letter. Appellants’ counsel alleged Momentum “fraudulently
induced [Benie] into entering into the APA” and that Momentum had “breached material
terms of the APA.” (Trial Ex. M.) Appellants’ counsel acknowledged that, if the APA was a
“valid and enforceable agreement,” Benie’s obligation under the APA was “to provide, in a
timely fashion, to Momentum Freight any premium dividends it should receive” for the
applicable policy periods. (Trial Ex. M.) Appellants informed Momentum the BWC “checks
ha[d] been deposited into a separate interest-bearing account” to “ensure Benie Logistics
complie[d] with the terms of the APA” while they investigated the matter. (Trial Ex. M.)
The Dawsons deposited both the $69,269 and $257,999.32 checks from the BWC into
Benie’s business savings account at Chase Bank on January 25, 2021. (Trial Ex. FF.)
{¶ 13} On October 5, 2021, the Dawsons transferred the total amount of the two
BWC dividend checks from Benie’s business savings account to their joint personal savings
No. 24AP-263 5
account. The following day, the Dawsons transferred the BWC funds from their joint
personal savings account to their joint personal checking account, and then to Russell’s
separate personal checking account. Russell used the funds from the BWC dividend checks
to “pay [himself] back” for “bills [he] paid for [Benie’s] benefit.” (Sept 19, 2023 Tr. Vol. 2
at 218, 226.) By the end of November 2021, Benie was no longer in business.
{¶ 14} Momentum filed an amended complaint on April 11, 2022. Momentum’s
amended complaint added Elizabeth and Russell as defendants, and added claims for
piercing the corporate veil, fraudulent inducement, fraudulent transfer, and civil
conspiracy.
{¶ 15} On April 24, 2023, Elizabeth and Russell filed a motion for summary
judgment. The Dawsons noted they were not parties to the APA and therefore claimed they
were not liable for Benie’s “corporate contractual obligation” to pay Momentum “the
dividend portion of the BWC money.” (Mot. for Summ. Jgmt. at 3.) The Dawsons also
claimed the economic loss rule barred Momentum’s tort claims against them. Momentum
filed a response to the Dawsons’ motion for summary judgment on May 22, 2023.
{¶ 16} On June 13, 2023, the trial court denied the Dawsons’ motion for summary
judgment. The court found genuine issues of material fact regarding whether the Dawsons
could be held personally liable for Benie’s breach of the APA. The court further found the
economic loss rule did not bar Momentum’s tort claims because the tort claims alleged “a
breach of duty separate from that set forth in the APA.” (June 13, 2023 Decision & Entry
at 10.)
{¶ 17} The matter came before the court for a bench trial on September 18 and 19,
2023. Mr. Homer, Elizabeth, and Russell were the sole witnesses to testify at the trial.
Elizabeth explained that, based on the word “reimbursement” in section 1.2.7 of the APA,
the Dawsons believed section 1.2.7 meant “[t]hat which Momentum paid into BWC” as
premiums “would be reimbursed” to Momentum. (Tr. Vol. 1 at 75, 95-96.) As such, the
Dawsons agreed the APA required Benie to provide the $69,269 BWC check amount to
Momentum, because Momentum paid $69,269 in premiums to the BWC during the 2019
policy period. However, the Dawsons claimed Benie did not owe Momentum the
$257,999.32 BWC check amount. Mr. Homer affirmed the appellants never provided him
with either the $69,269 or the $257,999.32 BWC check amounts.
No. 24AP-263 6
{¶ 18} On March 19, 2024, the trial court issued a decision and entry resolving the
case. The court determined that section 1.2.7 of the APA required Benie to “timely forward
both the $69,269.00 and $257,999.32 payments from the [BWC] to [Momentum] because
those payments were 2019 policy premium dividends for policy no. 1519862.” (Mar. 19,
2024 Decision & Entry at ¶ 49.) The court noted Benie never provided either check amount
to Momentum, and that in October of 2020 the Dawsons transferred the total amount of
the two BWC dividend checks “to an account owned by Russell Dawson where those funds
were extinguished.” (Mar. 19, 2024 Decision & Entry at ¶ 66.) As such, the court found
Benie breached the APA by not providing the BWC dividend checks to Momentum in a
timely fashion. The court also found the evidence demonstrated Momentum could pierce
the corporate veil of Benie and hold the Dawsons personally liable for the breach of contract
damages. The court found appellants committed civil theft with respect to the $69,269
BWC check, but that appellants did not commit civil theft with respect to the $257,999.32
BWC check. The court awarded Momentum treble damages for the theft of the $69,269.
The court determined appellants committed conversion, but noted Momentum pled
conversion as an alternative to civil theft. The court also determined appellants committed
fraudulent transfer and civil conspiracy, but found the damages for both claims were the
same as the damages resulting from the breach of contract. The court dismissed
Momentum’s claims for unjust enrichment and fraudulent inducement. As such, the court
entered judgment against Benie, Elizabeth, and Russell, jointly and severally, in the amount
of $257,999.32 plus $69,269 trebled to $207,807, for a total judgment of $465,806.32, plus
interest at the statutory rate.
II. Assignments of Error
{¶ 19} Appellants appeal, assigning the following errors for our review:
ASSIGNMENT OF ERROR NO. 1
The Trial Court erred as a matter of law in defining “[Bureau
of] Workers’ Compensation premium dividend
reimbursement” as used in the contract between the parties.
The definition should not encompass COVID-Pandemic-
related stimulus money that the BWC issued during COVID.
ASSIGNMENT OF ERROR NO. 2
The Trial Court erred in deciding a mixed matter of law and fact
in finding a fraudulent transfer of $327,268.32 where the
No. 24AP-263 7
Appellees had no right, title, or interest in part of the money
that was transferred.
ASSIGNMENTS OF ERROR NO. 3
The Trial Court erred in deciding a mixed question of law and
fact in finding that Appellees can pierce the corporate veil of
Benie Logistics, Inc.
ASSIGNMENT OF ERROR NO. 4
The Trial Court erred in deciding a mixed question of law and
fact in finding that Appellants engaged in civil theft by
withholding the first dividend payment of $69,269, and
awarding damages of three times the same totaling $207,807.
ASSIGNMENT OF ERROR NO. 5
The Trial Court erred in deciding a mixed question of law and
fact in finding that Appellants engaged in a civil conspiracy to
deprive Appellees of $327,268.32.
III. First Assignment of Error–Breach of Contract
{¶ 20} In their first assignment of error, appellants contend the trial court erred by
interpreting the phrase “Workers’ Compensation premium dividend reimbursement” in
section 1.2.7 of the APA to include COVID-related stimulus money. As such, appellants
claim the trial court erred by finding Benie breached the APA with respect to the
$257,999.32 BWC check.
{¶ 21} To demonstrate a claim for breach of contract, a plaintiff must establish: “(1)
the existence of a contract, (2) performance by the plaintiff, (3) breach by the defendant,
and (4) damages or loss resulting from the breach.” Claris, Ltd. v. Hotel Dev. Servs., LLC,
2018-Ohio-2602, ¶ 28 (10th Dist.), citing Lucarell v. Nationwide Mut. Ins. Co., 2018-Ohio-
15, ¶ 41. The construction of a written contract is a question of law. Alexander v. Buckeye
Pipeline Co., 53 Ohio St.2d 241 (1978), paragraph one of the syllabus; St. Marys v. Auglaize
Cty. Bd. of Commrs., 2007-Ohio-5026, ¶ 38. “[A] de novo standard of review applies to
matters of law, including the interpretation and construction of written contracts.” Gatling
Ohio, LLC v. Allegheny Energy Supply Co., LLC, 2018-Ohio-3636, ¶ 12 (10th Dist.), citing
Long Beach Assn. v. Jones, 82 Ohio St.3d 574 (1998). “Under the de novo standard, the
court of appeals gives no deference to a trial court’s interpretation of legal issues.” Id.
No. 24AP-263 8
{¶ 22} When construing the terms of a written contract, a court’s principal objective
is to determine the intent of the parties. Jezerinac v. Dioun, 2020-Ohio-587, ¶ 33 (10th
Dist.), citing Hamilton Ins. Servs., Inc. v. Nationwide Ins. Companies., 86 Ohio St.3d 270,
273 (1999). The parties’ intent “is presumed to reside in the language they chose to employ
in the agreement.” Kelly v. Med. Life Ins. Co., 31 Ohio St.3d 130, 132 (1987). “ ‘When
parties to a contract dispute the meaning of the contract language, courts must first look to
the four corners of the document to determine whether or not an ambiguity exists.’ ” Min
You v. Northeast Ohio Med. Univ., 2020-Ohio-4661, ¶ 15 (10th Dist.), quoting Drs. Kristal
& Forche, D.D.S., Inc. v. Erkis, 2009-Ohio-5671, ¶ 21 (10th Dist.). “Where the terms of the
contract are clear and unambiguous, a court should not look beyond the plain language of
the instrument to determine the rights and obligations of the parties.” Guaranteed Constr.
Servs. v. Grand Communities, Ltd., 2017-Ohio-9288, ¶ 23 (10th Dist.), citing Drs. Kristal
& Forche, D.D.S., Inc. at ¶ 21.
{¶ 23} “Common words in a contract are given their plain and ordinary meaning,
unless another meaning is clearly evident from the face or overall content of the contract,
or unless the result is manifestly absurd.” Hope Academy Broadway Campus v. White Hat
Mgt., L.L.C., 2015-Ohio-3716, ¶ 36, citing Alexander. The court must read words and
phrases in context and apply the rules of grammar and common usage. Buffalo Wings &
Rings, LLC v. M3 Restaurant Group, LLC, 2015-Ohio-3843, ¶ 18 (10th Dist.), citing Keller
v. Foster Wheel Energy Corp., 2005-Ohio-4821 (10th Dist.). It is the duty of a court to give
effect to the words used in a contract, not to delete words used or to insert words not used.
Cleveland Elec. Illuminating Co. v. Cleveland, 37 Ohio St.3d 50 (1988), paragraph three of
the syllabus; Eckel v Bowling Green State Univ., 2012-Ohio-3164, ¶ 23 (10th Dist.).
{¶ 24} Contract terms are ambiguous if the meaning of the terms cannot be
discerned from reading the entire contract, or if the terms are reasonably susceptible to
more than one interpretation. Moody v. Ohio Rehab. Servs. Comm., 2002-Ohio-6965, ¶ 7
(10th Dist.), citing United States Fid. & Guar. Co. v. St. Elizabeth Med. Ctr., 129 Ohio
App.3d 45, 55 (2d Dist. 1998). While the issue of whether a contract is ambiguous is a
question of law, the meaning of words or phrases in an ambiguous contract is a question of
fact. Atelier Dist. v. Parking Co. of Am., Inc., 2007-Ohio-7138, ¶ 17 (10th Dist.), citing Ohio
Historical Soc. v. Gen. Maintenance & Eng. Co., 65 Ohio App.3d 139, 146 (10th Dist. 1989).
No. 24AP-263 9
Where the language of a contract is ambiguous, a court may consider extrinsic evidence to
ascertain the parties’ intent. Westfield Ins. Co. v. Galatis, 2003-Ohio-5849, ¶ 12, citing
Shifrin v. Forest City Ents., Inc., 64 Ohio St.3d 635 (1992). See also Albert v. Shiells, 2002-
Ohio-7021, ¶ 20 (10th Dist.) (stating that “where the meaning of a contract is ambiguous,
the ambiguity should be construed against the drafting party”).
{¶ 25} As noted, section 1.2.7 of the APA identified “the Workers’ Compensation
premium dividend reimbursement, for the [2019] Policy Period” as an Excluded Asset.
(Compl. Ex. A, APA § 1.2.7.) Although the APA stated the amount would be “prorated for
the months [Momentum] was in operation,” Momentum was in operation during the entire
span of the 2019 policy period. As such, the APA obligated Benie to provide the total
amount of the BWC premium dividend reimbursement for the 2019 policy period to
Momentum “in a timely fashion.” (Compl. Ex. A, APA § 1.2.7.)
{¶ 26} The trial court concluded appellants’ construction of section 1.2.7 did “not
comport with the plain language of what section 1.2.7 of the Agreement provides.” (Mar. 19,
2024 Decision & Entry at ¶ 93.) The court noted interpreting the word “reimbursement”
as “limiting the amount of the payments . . . to the actual amount of premiums
[Momentum] paid for the 2019 policy period would ignore the use of the word ‘dividends’
in section 1.2.7, which indicate[d] something more than what was paid as premiums.”
(Mar. 19, 2024 Decision & Entry at ¶ 93.) The court found that both the $69,269.00 and
$257,999.32 checks from the BWC “were policy premium dividends for the 2019 policy
period as defined in the Agreement.” (Mar. 19, 2024 Decision & Entry at ¶ 98.)
{¶ 27} At trial, Elizabeth affirmed the “$69,269 should have been paid to
Momentum Freight according to section 1.2.7 of the [APA],” and that Benie never paid the
$69,269 to Momentum.1 (Tr. Vol. 1 at 96 [1286].) Appellants do not challenge the trial
court’s conclusion that Benie breached the APA by failing to provide the $69,269.00 BWC
check to Momentum.
{¶ 28} Rather, appellants challenge the trial court’s conclusion that Benie breached
the APA by failing to provide the $257,999.32 BWC check to Momentum. Appellants
1 Elizabeth stated Benie did not provide the $69,269 BWC payment to Momentum because Momentum
claimed Benie owed it “more than $400,000” and Momentum would not agree to sign a “release” and “settle
for just $69,000.” (Tr. Vol. 1 at 97.) However, Momentum’s refusal to release Benie from liability for
additional amounts Momentum claimed due under the APA did not relieve Benie of its contractual
obligation to provide Momentum with the $69,269 payment from the BWC.
No. 24AP-263 10
contend that, while the parties “anticipated at the time of entering the APA that the BWC
may issue a premium dividend reimbursement to repay premiums paid by Momentum
Freight,” the parties did not anticipate “any BWC COVID-Pandemic-stimulus money when
they entered the APA.” (Appellants’ Brief at 18.) Appellants claim the $257,999.32 check
was “Covid-stimulus money” and assert that section 1.2.7 of the APA was “ambiguous as to
whether the ‘excluded assets’ would include COVID-Pandemic-stimulus money.”
(Appellants’ Brief at 18-19.)
{¶ 29} Initially, we look to the four corners of the APA to determine whether the
phrase “Workers’ Compensation premium dividend reimbursement, for the [2019] Policy
Period” was ambiguous. (Compl. Ex. A, APA § 1.2.7.) The word “premium” in this context
refers to “[t]he amount paid at designated intervals for insurance; esp., the periodic
payment required to keep an insurance policy in effect.” Black’s Law Dictionary 1430 (12th
Ed. 2024). Black’s Law Dictionary defines the word “dividend” as “[a] portion of a
company’s earnings or profits distributed pro rata to its shareholders, usu. in the form of
cash or additional shares.” Black’s Law Dictionary 601 (12th Ed. 2024). Merriam-
Webster’s Collegiate Dictionary defines the term “dividend” as “a share in a pro rata
distribution (as of profits) to stockholders” and as “a share of surplus allocated to a
policyholder in a participating insurance policy.” Merriam-Webster’s Collegiate
Dictionary 366 (11th Ed. 2003). The term “reimbursement” is defined as “[t]he act or an
instance of paying back a sum of money.” Black’s Law Dictionary 1541 (12th Ed. 2024).
See also Merriam-Webster’s Collegiate Dictionary 1049 (11th Ed. 2003) (defining
“reimburse” as “to pay back to someone”).
{¶ 30} Thus, giving the words in section 1.2.7 of the APA their plain and ordinary
meaning, the section demonstrated Benie would provide to Momentum any amount of
surplus the BWC paid back to Momentum for the premiums Momentum paid during the
2019 policy period. The term “reimbursement” referred to the BWC’s act of paying funds
back to policyholders, while the term “dividend” demonstrated the amount reimbursed
could be any amount of surplus or profits the BWC decided to distribute. To interpret
section 1.2.7 as limiting the amount Momentum could receive to only the amount
Momentum paid in to the BWC as premiums would require us to delete the word “dividend”
from the section. As noted, we must give effect to all words used in a contract and may not
No. 24AP-263 11
delete words from the agreement. Cleveland Elec. Illuminating Co., 37 Ohio St.3d at 53.
Because section 1.2.7 is unambiguous, we must apply the plain language of the agreement
as written. Accordingly, appellants’ dispute resolves to whether the $257,999.32 BWC
check was a premium dividend reimbursement for the 2019 policy period, or whether the
check was COVID-stimulus money as appellants contend.
{¶ 31} Initially, we believe it may be helpful to explain how Ohio’s workers’
compensation system operates. “Pursuant to R.C. 4123.29(A), the administrator of the
BWC, with the approval of the board of directors, classifies occupations or industries with
respect to degree of hazard and risks and sets the premiums that employers must pay into
the state insurance fund for workers’ compensation coverage each year.” Cleveland v. Ohio
Bur. of Workers’ Comp., 2020-Ohio-337, ¶ 4. The BWC deposits the employer premiums
“into a single state insurance fund (it does not maintain a separate account for each
employer), and it pays compensation benefits associated with work-related accidents from
that fund.” Id. R.C. 4123.321 “requires the BWC to establish a procedure for returning
excess premiums to participating employers in order to maintain a revenue-neutral fund.”
Id. See R.C. 4123.321 (providing that in the event there is a “surplus of earned premium
over all losses” in the state insurance fund the board “may return such excess surplus to the
subscribers to the fund”). The BWC board of directors has “full discretion and authority”
to determine “whether there is an excess surplus of premium; whether to return the excess
surplus to employers; the nature of the cash refunds or reduction of premiums;” and “any
other issues involving cash refunds or reduction of premiums due to an excess surplus of
earned premium.” Adm.Code 4123-17-10.
{¶ 32} The parties presented the affidavit of Michele Wedemeyer, a financial
manager for the BWC, as a joint exhibit at trial. Ms. Wedemeyer explained the BWC
“offered up to three (3) policy holder dividend payments” to private employers during the
calendar year 2020. (Trial Ex. LL, Wedemeyer Aff. at ¶ 3.) The BWC issued the first
policyholder dividend payment in “the Spring of 2020 (the ‘Spring Dividend’)” and issued
“most of these first policy holder dividend payments to eligible employers in April 2020.”
(Trial Ex. LL, Wedemeyer Aff. at ¶ 5.) To qualify for the Spring Dividend, the employer had
to satisfy certain criteria, including that the employer reported payroll and was billed
premium for the 2018 policy period. The amount of the Spring Dividend was “100% of the
No. 24AP-263 12
billed premium paid by the employer during the 2018 policy year.” (Trial Ex. LL,
Wedemeyer Aff. at ¶ 8.) The letter that accompanied the Spring Dividend stated the BWC
was issuing a “dividend of up to $1.6 billion to Ohio’s private and public employers, a move
on [the BWC’s] part to ease the financial pressures your organization may be experiencing
amid the COVID-19 pandemic.” (Trial Ex. JJ.) Momentum received a dividend check from
the BWC in the amount of $38,884.83 on April 21, 2020.
{¶ 33} The BWC issued the second policyholder dividend payment in the “Fall of
2020 (the ‘Fall Dividend’)” and issued “most of the second policy holder dividend payments
to eligible employers in October 2020.” (Trial Ex. LL, Wedemeyer Aff. at ¶ 9.) To qualify
for the Fall Dividend, the employer had to satisfy certain criteria, including that the
employer reported payroll and was billed premium for the 2019 policy period. The amount
of the Fall Dividend was “100% of the billed premium paid by the employer during the 2019
policy year.” (Trial Ex. LL, Wedemeyer Aff. at ¶ 11.) The FAQs the BWC issued with the
Fall Dividend stated the BWC was issuing a “dividend of up to $1.5 billion to ease the
financial pressures your organization may be experiencing amid the coronavirus (COVID-
19) pandemic.” (Trial Ex. E.) As noted, the BWC initially issued a dividend check in the
amount of $69,269 to Benie on October 22, 2020, but reversed and reissued the check in
December of 2020 because Benie lost the check.
{¶ 34} The BWC issued the third policyholder dividend payment “in the Winter of
2020 (the ‘Winter Dividend’)” and issued most of the “third policy holder dividend
payments to eligible employers in December 2020.” (Trial Ex. LL, Wedemeyer Aff. at ¶ 12.)
To qualify for the Winter Dividend the employer had to satisfy the same criteria applicable
for the Fall Dividend. The amount of the Winter Dividend was “3.7246 times the billed
premium paid by the employer during the 2019 policy year.” (Trial Ex. LL, Wedemeyer Aff.
at ¶ 14.) The FAQs issued with the Winter Dividend stated the BWC was issuing the “third
dividend this year” to help “ease the financial pressures your organization may be
experiencing amid the coronavirus (COVID-19) pandemic.” (Trial Ex. G.)
{¶ 35} Appellants claim the $257,999.32 check was COVID-stimulus money
because the letter that accompanied the check indicated the BWC issued the check to
“ ‘keep[] businesses open and people employed’ ” during the pandemic. (Appellants’ Brief
at 18, quoting Trial Ex. O.) However, the letters and FAQs that accompanied each dividend
No. 24AP-263 13
check the BWC issued in 2020 stated the BWC issued the checks to help businesses during
the COVID-19 pandemic. Notably, although the FAQs that accompanied the $69,269
dividend check specifically stated the BWC issued the check to help “ease the financial
pressures your organization may be experiencing amid the coronavirus (COVID-19)
pandemic,” appellants have not attempted to classify the $69,269 dividend check as
COVID-related stimulus money. (Trial Ex. E.)
{¶ 36} The Spring, Fall, and Winter dividends the BWC issued in 2020 were all
policyholder dividend payments calculated based on the premiums employers paid during
the applicable policy periods. The letter which accompanied the $257,999.32 dividend
check repeatedly stated the check was a “dividend” from the BWC, and explained that the
“dividend, [the BWC’s] third this year, was made possible by our investment returns,
prudent fiscal management, and the good work of employers who pay their BWC premiums
and look out for the health and safety of their employees.” (Trial Ex. O.) Thus, while easing
the financial strain businesses were experiencing due to the COVID-19 pandemic may have
motivated the BWC to issue each dividend, the BWC was able to issue the dividends due to
the amount of surplus funds in the state insurance fund.
{¶ 37} The BWC calculated the amount of both the $69,269 and $257,999.32
dividend checks based on the amount of premiums Momentum paid during the 2019 policy
period. Accordingly, both the $69,269 and $257,999.32 dividend checks were BWC
premium dividend reimbursements for the 2019 policy period. As such, the APA required
Benie to provide both amounts to Momentum in a timely fashion. Because Benie did not
provide either amount to Momentum, Benie breached the APA.
{¶ 38} Based on the foregoing, we overrule appellants’ first assignment of error.
IV. Third Assignment of Error–Piercing the Corporate Veil
{¶ 39} For ease of analysis, we address appellants’ third assignment of error next.
In their third assignment of error, appellants contend the trial court erred by allowing
Momentum to pierce Benie’s corporate veil.
{¶ 40} Corporations are generally considered distinct legal entities and corporate
shareholders and officers are not liable for the debts of the corporation. Belvedere
Condominium Unit Owners’ Assn. v. R.E. Roark Co., 67 Ohio St.3d 274, 287 (1993). An
exception to the general rule, known as piercing the corporate veil, was developed “in equity
No. 24AP-263 14
to protect creditors of a corporation from shareholders who use the corporate entity for
criminal or fraudulent purposes.” Id. at 287. The phrase “[p]iercing the corporate veil”
refers to the “ ‘judicial act of imposing personal liability on otherwise immune corporate
officers, directors, or shareholders for the corporation’s wrongful acts.’ ” Minno v. Pro-Fab,
Inc., 2009-Ohio-1247, ¶ 8, quoting Black’s Law Dictionary 1184 (8th Ed. 2004). Piercing
the corporate veil is not an independent cause of action; rather, “ ‘it is a remedy
encompassed within a claim.’ ” RCO Internatl. Corp. v. Clevenger, 2008-Ohio-6823, ¶ 11
(10th Dist.), quoting Geier v. Natl. GG Industries, Inc., 1999 Ohio App. LEXIS 6263 (11th
Dist. Dec. 23, 1999).
{¶ 41} In Belvedere, the Supreme Court of Ohio established the following three-part
test for courts to apply when deciding whether to pierce the corporate veil:
(1) whether control over the corporation by those to be held
liable was so complete that the corporation had no separate
mind, will, or existence of its own, (2) [whether] control over
the corporation by those to be held liable was exercised in such
a manner as to commit fraud or an illegal act against the person
seeking to disregard the corporate entity, and (3) [whether]
injury or unjust loss resulted to the plaintiff from such control
and wrong.
Belvedere at paragraph three of the syllabus.
{¶ 42} All three prongs of the Belvedere test must be met for piercing to occur.
Dombroski v. WellPoint, Inc., 2008-Ohio-4827, ¶ 18. “Because ‘[o]ne of the purposes of
incorporation is to limit the liability of individual shareholders,’ the party seeking to have
the corporate form disregarded bears the burden of proof.” RCO Internatl. Corp. v. at ¶ 10,
quoting Univ. Circle Research Ctr. Corp. v. Galbreath Co., 106 Ohio App.3d 835, 840 (8th
Dist. 1995). Piercing the corporate veil “remains a ‘rare exception,’ to be applied only ‘in
the case of fraud or certain other exceptional circumstances.’ ” Dombroski at ¶ 17, quoting
Dole Food Co. v. Patrickson, 538 U.S. 468, 475 (2003). Whether the three-part Belvedere
test has been satisfied is primarily an issue for the trier of fact to resolve; “a reviewing court
will examine the record ‘for competent, credible evidence to support the decision of the trial
court.’ ” Siva v. 1138 LLC, 2007-Ohio-4667, ¶ 11 (10th Dist.), quoting Robert A. Saurber
Gen. Contractor, Inc. v. McAndrews, 2004-Ohio-6927, ¶ 26 (12th Dist.).
No. 24AP-263 15
1. Alter Ego
{¶ 43} The first prong of the Belvedere test “is a concise statement of the alter ego
doctrine; to succeed a plaintiff must show that the individual and the corporation are
fundamentally indistinguishable.” Belvedere at 288. Courts consider the following non-
exhaustive factors to determine whether the corporation was the alter ego of its
shareholders: grossly inadequate capitalization, failure to observe corporate formalities,
the absence of corporate records, the insolvency of the debtor corporation at the time the
debt was incurred, shareholders holding themselves out as personally liable for certain
corporate obligations, diversion of corporate funds or property for personal use, and
whether corporate funds were commingled with personal funds. Sanderson Farms, Inc. v.
Gasbarro, 2004-Ohio-1460, ¶ 26 (10th Dist.); Springfield v. Palco Invest. Co., 2013-Ohio-
2348, ¶ 84 (2d Dist.). See Sanderson Farms, Inc. at ¶ 31 (finding the first prong of the
Belvedere test satisfied because the defendants “disregarded corporate formalities,
dominated and controlled the corporations, and diverted corporate funds for personal
use”).
{¶ 44} The trial court found the Dawsons operated Benie as their alter ego “with
control over the corporation so complete that Benie had no separate mind, will, or existence
of its own.” (Mar. 19, 2024 Decision & Entry at ¶ 121.). The trial court found Benie was
grossly undercapitalized upon formation, corporate formalities were routinely ignored, and
that corporate funds were routinely commingled with the Dawsons’ personal funds. The
court noted the Dawsons “fail[ed] to document alleged loans” they provided to Benie and
that the Dawsons routinely used their own “personal credit . . . for business purposes with
no documentation or explanation.” (Mar. 19, 2024 Decision & Entry at ¶ 120.)
{¶ 45} Benie was incorporated as a domestic corporation on June 1, 2020. Benie
had only $500 in its bank account when it began operating as a FedEx delivery business on
August 29, 2020. Elizabeth admitted that even having $4,000 in Benie’s bank account
would be insufficient to operate the business. (Tr. Vol. 1 at 135.) Accordingly, the record
demonstrated Benie was grossly undercapitalized upon formation.
{¶ 46} Benie’s corporate bylaws required that it hold annual shareholder and board
of directors meetings. The bylaws also permitted special shareholder and/or board of
directors meetings to be called “for any purpose or purposes permitted by law.” (Trial Ex.
No. 24AP-263 16
HH, Art. 2, § 1, 2; Art. 3, § 5, 6.) The bylaws required the company’s secretary to maintain
“a book of minutes of all meetings of directors and shareholders,” documenting the “time
and place of holding of all meetings; whether regular or special,” and an “account of the
proceedings” at each meeting. (Trial Ex. HH, Art. 4, § 4.) The Dawsons affirmed Benie did
not hold any formal shareholder or board of directors meetings and that it did not maintain
minutes of any meetings. Although Elizabeth claimed she and Russell would hold informal
“board member meetings” over “meals” or on the phone “while [Russell] was driving a
FedEx truck,” she explained that any notes from such meetings would have been written on
a “sticky note and then toss[ed] it when [they were] done.” (Tr. Vol. 1 at 160, 167.) Russell
affirmed corporate “formalities were not kept up like they should have been.” (Tr. Vol. 2 at
250.) Accordingly, the record demonstrated the Dawsons failed to observe corporate
formalities and failed to maintain corporate records.
{¶ 47} For nearly every month that Benie was in operation, Benie made regular
lump sum payments of $10,000 from its business bank account to the Dawsons’ personal
bank account. The Dawsons both claimed the $10,000 payments were their “payment for
work.” (Tr. Vol. 1 at 154; Tr. Vol. 2 at 236.) Benie’s bylaws stated that, “[s]ubject to
contractual agreements approved by the boards of directors, officers of the corporation
shall . . . receive salary and benefits as may be approved by the board.” (Trial Ex. HH, Art.
4, § 1.) The Dawsons did not produce any contractual agreements, approved by Benie’s
board of directors, detailing their approved salaries. As such, the lump sum payments of
$10,000 from Benie to the Dawsons appeared to be a diversion of corporate funds for
personal use.
{¶ 48} The record demonstrated the Dawsons were “constantly using personal
credit cards on Benie business.” (Tr. Vol. 2 at 267.) Elizabeth noted the Dawsons had to
use personal credit cards to operate Benie because they “couldn’t get enough credit for
Benie to take care of Benie’s business needs.” (Tr. Vol. 1 at 163-64.) The Dawsons also
made “significant payments . . . from Benie’s business account to [their] personal credit
card accounts.” (Tr. Vol. 1 at 161.) Indeed, Russell affirmed Benie paid “tens of thousands
of dollars” to his “personal credit card” every “month.” (Tr. Vol. 2 at 240.) Although Russell
claimed some of his personal credit cards were “dedicated to Benie for only Benie
expenses,” he acknowledged that at least one of his personal credit cards contained charges
No. 24AP-263 17
related to both Benie’s business and his personal expenses. (Tr. Vol. 2 at 197-98, 238.)
Accordingly, the Dawsons made themselves personally liable for corporate debts by using
their personal credit cards for Benie’s business, and the Dawsons diverted corporate funds
for personal use by using Benie’s resources to pay off their personal credit cards.
{¶ 49} The Dawsons owned or were officers in other FedEx delivery businesses,
known as Red Logistics, Khoda, and Titus. Elizabeth affirmed “significant sums of money
[were] being paid to Benie from Red Logistics, Khoda and Titus,” and that Benie was
“pay[ing] back[]” significant sums of money to these entities as well. (Tr. Vol. 1 at 146, 148.)
The Dawsons also made “substantial financial investments” of their own personal money
in Benie. (Tr. Vol. 1 at 142.) Although the Dawsons claimed the funds they and their
affiliated entities provided to Benie were all “loans,” the Dawsons affirmed there were no
written loan agreements documenting any of the terms of the alleged loans. (Tr. Vol. 1 at
142-43, 146; Tr. Vol. 2 at 233.) Russell explained he would “just move money back and
forth between the [bank] accounts” as “needed.” (Tr. Vol. 2 at 233.)
{¶ 50} Appellants contend Trial Exhibit Y documented the “loans” Benie received
“from its owners.” (Appellants’ Brief at 31.) However, Russell admitted the Dawsons
prepared Exhibit Y after the “initiation of th[e] lawsuit.” (Tr. Vol. 2 at 194.) Exhibit Y does
not depict any loan agreements between the Dawsons and Benie; rather, the exhibit depicts
a list of credit cards with amounts written next to each card. (Trial Ex. Y.) The exhibit
indicates the amount placed on some of the credit cards was “allocated to Benie & Red
[Logistics] per analysis,” but does not explain how much was allocated to each entity. (Trial
Ex. Y.) Accordingly, the trial court did not err by finding the evidence demonstrated the
Dawsons “fail[ed] to document alleged loans.” (Mar. 19, 2024 Decision & Entry at ¶ 119.)
The substantial sums of money the Dawsons moved back and forth between themselves,
Benie, and their affiliated businesses without any written loan agreements or other
documentation demonstrated the Dawsons routinely commingled corporate funds and
personal funds.
{¶ 51} Accordingly, competent, credible evidence supported the trial court’s
conclusion that Benie was undercapitalized upon formation, failed to observe corporate
formalities, failed to maintain corporate records, and that the Dawsons held themselves out
as personally liable for corporate expenses and regularly commingled corporate funds and
No. 24AP-263 18
personal funds. As such, the record supported the trial court’s conclusion that Benie was
the alter ego of the Dawsons, with no separate mind, will or existence of its own.
2. Fraud or Illegal Act
{¶ 52} In Dombroski, the Supreme Court stated that “[t]o fulfill the second prong of
the Belvedere test, the plaintiff must demonstrate that the defendant shareholder exercised
control over the corporation in such a manner as to commit fraud, an illegal act, or a
similarly unlawful act.” Dombroski, 2008-Ohio-4827, at syllabus. The trial court found
the second element of the Belvedere/Dombroski test satisfied in the present case because
the Dawsons operated Benie “in order to defraud and steal from [Momentum] by
transferring the $69,269.00 and $257,999.32 payments from the [BWC] which
contractually Benie owed to [Momentum].” (Mar. 19, 2024 Decision & Entry at ¶ 122.)
{¶ 53} The trial court found appellants committed civil theft of the $69,269 BWC
dividend check in violation of R.C. 2307.60 and 2913.02(A)(2). R.C. 2307.60(A)(1)
provides that “[a]nyone injured in person or property by a criminal act has, and may recover
full damages in, a civil action unless specifically excepted by law.” Proof of an underlying
criminal conviction is not required to maintain an action under R.C. 2307.60. Buddenberg
v. Weisdack, 2020-Ohio-3832, ¶ 11. R.C. 2913.02(A)(2) defines the criminal offense of
theft, providing that “[n]o person, with purpose to deprive the owner of property or
services, shall knowingly obtain or exert control over either the property or services . . .
[b]eyond the scope of the express or implied consent of the owner or person authorized to
give consent.”
{¶ 54} Throughout the trial the Dawsons admitted that, although section 1.2.7 of the
APA obligated them to provide the $69,269 BWC dividend check to Momentum, they never
provided the $69,269 to Momentum. Instead, the Dawsons transferred the $69,269 BWC
check amount from Benie’s business bank account to Russell’s personal bank account in
October of 2021. Accordingly, the record supported the trial court’s conclusion that the
Dawsons acted with the purpose to deprive Momentum of the $69,269 BWC dividend
check when they knowingly obtained the funds and exerted control over them beyond the
scope of the consent given to them under the APA. The Dawsons theft of the $69,269
constituted to an illegal act under the second prong of the Belvedere/Dombroski test. See
Kurtz Bros. v. Ace Demo, Inc., 2014-Ohio-5184, ¶ 35 (11th Dist.) (noting the plaintiff
No. 24AP-263 19
“satisfied its duty to allege [the defendant] committed an illegal act” under the second prong
of the Belvedere/Dombroski test because the plaintiff “alleged facts supporting a criminal
offense of theft”).
{¶ 55} The trial court also found the Dawsons committed a fraudulent transfer with
respect to both the $69,269 and $257,999.32 BWC dividend checks. “Disposing of assets
in violation of the [Ohio Uniform Fraudulent Transfer Act] has been found to satisfy” the
second prong of the piercing the corporate veil test. William E. Weaner & Assocs., LLC v.
369 West, 2020-Ohio-48, ¶ 55 (2d Dist.). See Flagstar Bank, FSB v. Sellers, 2010-Ohio-
3951, ¶ 23 (12th Dist.) (concluding that “systematically disposing” of corporate assets “in
violation of the Ohio Uniform Fraudulent Transfer Act . . . fulfill[ed] the second prong of
the piercing the corporate veil test”); Stewart v. R.A. Eberts Co., 2009-Ohio-4418, ¶ 25 (4th
Dist.) (noting the “defendant shareholders, acting through the defendant corporations,
committed ‘fraud and illegal acts’ in the form of fraudulent transfers when they transferred
and disposed of assets and liabilities with the intent to hinder, delay or defraud Stewart as
a creditor”).
{¶ 56} Ohio’s Uniform Fraudulent Transfers Act, contained in R.C. Chapter 1336,
provides that a debtor’s transfer of assets is fraudulent as to a creditor if the debtor made
the transfer with “actual intent to hinder, delay, or defraud any creditor of the debtor.” R.C.
1336.04(A)(1). See Hanamura-Valashinas v. Transitions by Firenza, LLC, 2020-Ohio-
4888, ¶ 34 (11th Dist.). To determine whether a debtor acted with actual intent to defraud
under R.C. 1336.04(A)(1), a court should consider all relevant factors, including the
following factors in R.C. 1336.04(B):
(1) Whether the transfer or obligation was to an insider;
(2) Whether the debtor retained possession or control of the
property transferred after the transfer;
(3) Whether the transfer or obligation was disclosed or
concealed;
(4) Whether before the transfer was made or the obligation
was incurred, the debtor had been sued or threatened with
suit;
(5) Whether the transfer was of substantially all of the assets
of the debtor;
(6) Whether the debtor absconded;
No. 24AP-263 20
(7) Whether the debtor removed or concealed assets;
(8) Whether the value of the consideration received by the
debtor was reasonably equivalent to the value of the asset
transferred or the amount of the obligation incurred;
(9) Whether the debtor was insolvent or became insolvent
shortly after the transfer was made or the obligation was
incurred;
(10) Whether the transfer occurred shortly before or shortly
after a substantial debt was incurred;
(11) Whether the debtor transferred the essential assets of the
business to a lienholder who transferred the assets to an
insider of the debtor.
The R.C. 1336.04(B) factors are “commonly referred to as ‘badges of fraud.’ ” Gevedon v.
Ivey, 2003-Ohio-6521, ¶ 10 (2d Dist.).
{¶ 57} The trial court determined the evidence established the following badges of
fraud in the present case: the Dawsons were insiders of Benie, the Dawsons did not disclose
the transfer of the BWC funds, the transfer occurred after Momentum filed suit against
Benie, Benie was insolvent when the transfer occurred, and the transfer consisted of
substantially all of Benie’s assets. The trial court also found “clear and convincing evidence
of [the Dawsons’] intent to hinder, defraud and delay [Momentum] from obtaining those
funds” because the Dawsons admitted they transferred the funds “to avoid creditors of
Benie obtaining those funds.” (Mar. 19, 2024 Decision & Entry at ¶ 110.) The record
supports the trial court’s findings.
{¶ 58} The Dawsons were the sole shareholders and officers of Benie, so the transfer
of the BWC funds from Benie to the Dawsons was a transfer to company insiders. In
January of 2021, the Dawsons placed the BWC dividend checks into Benie’s business
savings account and informed Momentum the checks had been “deposited into a separate
interest-bearing account” to “ensure Benie Logistics complie[d] with the terms of the APA.”
(Trial Ex. M.) The Dawsons did not inform anybody when they subsequently transferred
the funds from Benie’s business savings account to their personal bank accounts in October
of 2021. As such, the Dawsons led Momentum to believe the funds had been safeguarded
in a separate account and then transferred the funds to themselves without disclosing the
transfer. Benie’s registered agent received service of the complaint in the present case on
No. 24AP-263 21
September 14, 2021, and the Dawsons transferred the BWC funds on October 5, 2021.
Accordingly, the transfer occurred after Benie had been sued.
{¶ 59} The Dawsons both acknowledged that the transfer of the BWC funds to
themselves in October of 2021 transferred substantially all of Benie’s remaining assets. (Tr.
Vol. 1 at 137-38; Tr. Vol. 2 at 222.) Elizabeth agreed that, in October of 2021, “Benie [was]
not able to pay all of its debts as they c[a]me due.” (Tr. Vol. 1 at 126.) See R.C. 1336.02(A)(2)
(stating “[a] debtor who generally is not paying his debts as they become due is presumed
to be insolvent”). Russell affirmed Benie was “basically insolvent” as of October 5, 2021.
(Tr. Vol. 2 at 220.) Accordingly, the record demonstrated Benie was insolvent when the
Dawsons transferred the BWC funds to their personal bank accounts.
{¶ 60} Elizabeth stated the Dawsons transferred the BWC funds from Benie’s bank
account to their personal bank accounts because Benie’s Chase Bank business credit card
was “extremely, extremely over maxed,” and the Dawsons were concerned Chase Bank
“would most likely start taking the money automatically out of the [bank] account” to pay
the credit card debt. (Tr. Vol. 1 at 123.) Thus, Elizabeth affirmed she moved the BWC funds
to “avoid having those creditors access those funds.” (Tr. Vol. 1 at 124.) Russell affirmed
Momentum was a creditor of Benie in October of 2021, at least with respect to the $69,269
BWC dividend check amount. Elizabeth explained that when she transferred the BWC
funds to Russell’s personal account, she made the preferential decision to pay Russell back
over Benie’s other creditors. (Tr. Vol. 1 at 123-24, 147.)
{¶ 61} Accordingly, based on the demonstrated badges of fraud and the Dawsons’
admitted intent to transfer the BWC funds to prevent their creditors from obtaining those
funds, competent, credible evidence demonstrated the Dawsons transferred the BWC funds
with actual intent to hinder, delay, or defraud Momentum. Accordingly, the record
demonstrated the Dawsons exercised their control over Benie in such a manner as to
commit a fraudulent transfer. As such, the trial court properly found the second element
of the Belvedere/Dombroski test satisfied in the present case.
3. Injury or Loss
{¶ 62} By diverting the total amount of the two BWC dividend checks from Benie’s
bank account to their personal bank accounts in October of 2021, the Dawsons liquidated
Benie and made it impossible for Momentum to recover the BWC funds from Benie.
No. 24AP-263 22
Accordingly, the record demonstrated Momentum suffered damages in the amount of
$327,268.32 ($69,269 plus $257,999.32), as a result of the Dawsons control and wrongful
conduct of Benie. See Pottschmidt v. Klosterman, 2006-Ohio-6964, ¶ 43 (9th Dist.)
(finding the final element of the Belvedere test satisfied because the “transfer of all of the
original corporation’s assets to the new corporation . . . left the original corporation simply
an empty shell and made it impossible for Dr. Pottschmidt to collect the judgment rendered
in his favor”).
{¶ 63} Based on the foregoing, we find competent, credible evidence supported the
trial court’s decision to pierce the corporate veil of Benie and hold the Dawsons personally
liable for Benie’s wrongful acts. Therefore, we overrule appellants’ third assignment of
error.
V. Second, Fourth, and Fifth Assignments of Error–Tort Claims
{¶ 64} In their second, fourth, and fifth assignments of error, appellants contend the
trial court erred by finding in Momentum’s favor on its claims for fraudulent transfer, civil
theft, and civil conspiracy. Appellants claim the economic loss rule barred each of
Momentum’s tort claims. As such, we address these assignments of error jointly.
{¶ 65} The economic loss rule prevents recovery in tort of damages for purely
economic loss. Santagate v. Pennsylvania Higher Edn. Assistance Agency, 2020-Ohio-
3153, ¶ 38 (10th Dist.), citing Clemens v. Nelson Fin. Group, Inc., 2015-Ohio-1232, ¶ 34
(10th Dist.). The rule stems from the principle that, “[i]n the absence of privity of contract
between two disputing parties . . . ‘there is no * * * duty to exercise reasonable care to avoid
intangible economic loss or losses to others that do not arise from tangible physical harm
to persons and tangible things.’ ” Floor Craft Floor Covering v. Parma Community Gen.
Hosp. Assn., 54 Ohio St.3d 1, 3 (1990), quoting Prosser & Keeton, Law of Torts, § 92, at 657,
(5th Ed. 1984). “ ‘[W]hen the promisee’s injury consists merely of the loss of his bargain,
no tort claim arises because the duty of the promisor to fulfill the terms of the bargain arises
only from the contract.’ ” Chemtrol Adhesives, Inc. v. Am. Mfrs. Mut. Ins. Co., 42 Ohio
St.3d 40, 45 (1989), quoting Battista v. Lebanon Trotting Assn., 538 F.2d 111, 117 (6th Cir.
1976).
{¶ 66} Accordingly, “ ‘the existence of a contract action * * * excludes the opportunity
to present the same case as a tort claim.’ ” Textron Fin. Corp. v. Nationwide Mut. Ins. Co.,
No. 24AP-263 23
115 Ohio App.3d 137, 151 (9th Dist. 1996), quoting Wolfe v. Continental Cas. Co., 647 F.2d
705, 710 (6th Cir. 1981). A tort claim may exist, however, “ ‘if the breaching party also
breaches a duty owed separately from that duty created by the contract, that is, a duty owed
even if no contract existed.’ ” Homewood Homes, Inc. v. Helwig, 2009-Ohio-1699, ¶ 13
(10th Dist.), quoting Prater v. Three-C Body Shop, Inc., 2002 Ohio App. LEXIS 1485, *11
(10th Dist. Mar. 29, 2022). Thus, “where a tort claim alleges that a duty was breached
independent of the contract, the economic loss rule does not apply.” Ineos USA, LLC v.
Furmanite Am., Inc., 2014-Ohio-4996, ¶ 20 (3d Dist.). Accord Raze Internatl., Inc. v.
Southeastern Equip. Co., 2016-Ohio-5700, ¶ 62 (7th Dist.).
{¶ 67} “In addition to containing a duty independent of that created by contract, an
action arising out of contract which is also based upon tortious conduct must include actual
damages attributable to the wrongful acts of the alleged tortfeasor which are in addition to
those attributable to the breach of contract.” (Emphasis in original.) Textron Fin. Corp. at
151, citing Cincinnati Gas & Elec. v. G.E., 656 F.Supp. 49, 63 (S.D.Ohio 1986). Accord
Homewood Homes, Inc. at ¶ 13, citing Prater at *11 (noting the evidence “must show
damages attributable to the wrongful acts which are in addition to the damages attributable
to the breach of contract”); Ineos USA, LLC at ¶ 27, citing Strategy Group for Media v.
Lowden, 2013-Ohio-1330, ¶ 30 (5th Dist.) (stating that, in addition to presenting a separate
duty, the tort claim must present “damages separate from those recoverable for a breach”
of contract).
{¶ 68} The trial court properly determined the economic loss rule did not bar
Momentum’s claim for civil theft. The court noted Momentum’s claims for conversion and
civil theft “allege[d] intentional torts and involve[d] duties, actions and damages that
[were] extra-contractual in nature.” (June 13, 2023 Decision & Entry at 14.) The
“economic-loss doctrine does not apply to intentional torts,” because intentional torts
necessarily involve duties beyond those created by contract. Eysoldt v. Imaging, 2011-
Ohio-2359, ¶ 21 (1st Dist.). “ ‘[T]o the extent that a ‘theft offense’ under R.C. 2913.01
constitutes tortious conduct, it is akin to an intentional tort.’ ” Yeager v. U.S. Bank, 2021-
Ohio-1972, ¶ 21 (1st Dist.), citing Gurry v. C.P., 2012-Ohio-2640, ¶ 14 (8th Dist.).
{¶ 69} Accordingly, because Momentum’s claim for civil theft amounted to an
intentional tort, the claim necessarily involved the breach of a duty separate from any duty
No. 24AP-263 24
created by the APA. Indeed, while Benie breached the APA by failing to timely forward the
BWC dividends to Momentum, the Dawsons committed civil theft in violation of R.C.
2307.61 and 2913.02(A)(2) when they transferred the $69,269 dividend check amount
from Benie’s bank account to their personal bank accounts and extinguished the funds.
{¶ 70} If a property owner brings a civil action pursuant to R.C. 2307.60(A) “to
recover damages from any person who . . . commits a theft offense, as defined in section
R.C. 2913.01 of the Revised Code,” the property owner may recover the damages specified
in R.C. 2307.61. R.C. 2307.61(A). The statute states the property owner “may elect” to
recover “[l]iquidated damages” equal to “[t]hree times the value of the property at the time
it was willfully damaged or was the subject of a theft offense, irrespective of whether the
property is recovered by way of replevin or otherwise.” R.C. 2307.61(A)(1)(b)(ii). See
Batsche v. Batsche, 2024-Ohio-1234, ¶ 48 (12th Dist.) (observing that “[u]nder R.C.
2307.61, it does not matter whether the money was recovered”); Danceybey v. Dancy-
Dunlap, 2022-Ohio-2774, ¶ 13 (8th Dist.) (stating that “a prevailing plaintiff who has
elected treble damages under R.C. 2307.61(A) is entitled to his chosen remedy”).
{¶ 71} Pursuant to R.C. 2307.61(A), Momentum elected to recover, and the trial
court awarded it, treble damages for the theft of the $69,269 dividend check. Momentum
could not have obtained treble damages in its action for breach of contract. See Atelier
Dist., 2007-Ohio-7138, at ¶ 60 (noting “[c]ontract damages are intended to place the
injured party in the same position it would have been had the contract not been breached”).
Accordingly, Momentum’s claim for civil theft involved both a separate duty and separate
damages from those at issue in the breach of contract action. As such, the economic loss
doctrine did not bar Momentum’s claim for civil theft.
{¶ 72} Appellants further contend the trial court erred by finding Momentum
established its claim for civil theft on the merits. Appellants acknowledge they “owed
[Momentum] reimbursement for premiums that [Momentum] paid into BWC,” i.e. the
$69,269, but claim they “did not steal COVID-Pandemic-stimulus money,” i.e. the
$257,999.32. (Appellants’ Brief at 34.) However, the trial only found appellants committed
civil theft with respect to the $69,269.00 dividend check.2 Because appellants do not
2 The court concluded appellants did not commit civil theft with respect to the $257,999.32 dividend check
because it found appellants “genuinely, but mistakenly believed due to the unique circumstances
surrounding the issuance of those funds due to Global Health Pandemic that they were the owner” of the
No. 24AP-263 25
present any argument indicating the trial court erred by finding they committed civil theft
with respect to the $69,269 BWC check amount, we overrule appellants’ fourth assignment
of error.
{¶ 73} The record, however, demonstrates Momentum failed to establish any
damages resulting from its claims for fraudulent transfer and civil conspiracy that were
separate from the damages resulting from the breach of contract. Indeed, the trial court
found Momentum’s damages resulting from the fraudulent transfer and the civil conspiracy
were “the same as the damages for [Momentum’s] claim for breach of contract,” and the
court stated the damages for both claims “merge[d]” with Momentum’s breach of contract
damages. (Mar. 19, 2024 Decision & Entry at ¶ 114, 148.) Accordingly, because Momentum
failed to establish any damages for its fraudulent transfer or civil conspiracy claims beyond
the damages resulting from the breach of contract, the economic loss rule barred both
claims. See Textron Fin. Corp. at 151; Homewood Homes, Inc., 2009-Ohio-1699, ¶ 13. As
such, we sustain appellants’ second and fifth assignments of error.
{¶ 74} However, our holding in this regard presents no basis on which to reverse the
trial court’s judgment. The trial court entered judgment against Benie and the Dawsons,
jointly and severally, for the damages resulting from the breach of contract and civil theft.
Thus, while we agree the economic loss doctrine barred Momentum’s claims for fraudulent
transfer and civil conspiracy, because the trial court did not award any damages attributable
to these claims, there is no aspect of the court’s judgment which needs to be reversed.
Compare Hassey v. Columbus, 2018-Ohio-3958, ¶ 33 (10th Dist.), citing Joyce v. Gen.
Motors Corp., 49 Ohio St.3d 93, 96 (1990) (noting a “reviewing court will not reverse a
correct judgment merely because a trial court relied on an erroneous reason as the basis for
its determination”).
VI. Conclusion
{¶ 75} Having overruled appellants’ first, third, and fourth assignments of error, and
having sustained appellants’ second and fifth assignments of error which do not warrant
$257,999.32 check. (Mar. 19, 2024 Decision & Entry at ¶ 131.) See State v. Hubbard, 2013-Ohio-2735, ¶ 64
(10th Dist.), citing State v. Cooper, 2009-Ohio-6275, ¶ 9 (10th Dist.) (noting that “[m]istake of fact is widely
recognized as a defense to specific intent crimes such as theft”).
No. 24AP-263 26
reversal of the trial court’s judgment, we affirm the judgment of the Franklin County Court
of Common Pleas.
Judgment affirmed.
BOGGS, J., concurs.
LELAND, J., dissents.
LELAND, J., dissenting.
{¶ 76} Being unable to agree with the majority decision’s resolution of the Winter
Dividend payment under the first assignment of error, I respectfully dissent. Under this
assigned error, Benie maintains there is no evidence in the record that the parties “foresaw
the issuance of Covid-stimulus money when they entered the APA” on June 1, 2020.
(Appellants’ Brief at 18.) I agree with the contention of Benie that the Winter Dividend,
which was authorized by the BWC in November 2020, i.e., subsequent to the parties’
agreement and closing date and earmarked to mitigate the effects of the ongoing pandemic,
could not have been contemplated by the parties at the time of the APA. Nor do I view the
nature and purpose of the Winter Dividend, although calculated based on a percentage (i.e.,
372 percent) of prior-year premiums, as constituting “reimbursement” for past or overpaid
premiums but rather pandemic relief to assist employers in “keeping businesses open and
people employed.” (Trial Ex. O.)
{¶ 77} The stated purpose of the BWC’s discretionary decision to award the Winter
Dividend was “to ease the financial pressures your organization may be experiencing amid
the coronavirus (COVID-19) pandemic.” (Trial Ex. G.) In this respect, the BWC indicated
“[e]ligibility was based on an employer’s status (active, lapsed) with us as of Oct. 2.” (Trial
Ex. G.) See also RGT Invests., LLC v. DJ. Steakburgers, LLC, 2023 U.S. Dist. LEXIS 46473,
*28, 29 (S.D.Ohio Mar. 17, 2023) (observing that eligibility for the December 2020 COVID
dividend payment issued by the BWC “was tied to an employer’s status after October 2,
2020” and noting, under the facts of that case, it was undisputed the plaintiffs-sellers did
not operate any businesses or have any employees “as of October 2, 2020, the BWC’s
effective date for determining employer eligibility for the COVID dividend”).
{¶ 78} In the present case, as of October 2, 2020, the parties had already closed on
the APA, i.e., Momentum was no longer in operation and had no employees, while Benie at
No. 24AP-263 27
that time was operating its company with approximately 35 employees and had assumed,
as successor, transfer of the workers’ compensation policy. Given the nature, timing, and
purpose of the Winter Dividend, i.e., a wholly discretionary payment by the BWC
(authorized subsequent to the parties’ APA/closing) made with the intent to provide direct
financial assistance for active coverage employers to navigate ongoing operations during
the COVID-19 pandemic, and construing the language of the APA to effectuate the parties’
intent, I would conclude the trial court erred in its determination the Winter Dividend
constituted an excluded asset under the terms of the APA. Because the majority decision
does not reach that conclusion, I respectfully dissent.
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