[Cite as U.S. Bank v. Amir, 2012-Ohio-2772.]


                 Court of Appeals of Ohio
                               EIGHTH APPELLATE DISTRICT
                                  COUNTY OF CUYAHOGA


                              JOURNAL ENTRY AND OPINION
                                       No. 97438




                              U.S. BANK, ETC., ET AL.
                                                     PLAINTIFFS-APPELLEES

                                               vs.

                              CYNTHIA AMIR, ET AL.
                                                     DEFENDANTS-APPELLANTS




                                           JUDGMENT:
                                            AFFIRMED



                                     Civil Appeal from the
                              Cuyahoga County Common Pleas Court
                                     Case No. CV-594212

        BEFORE: S. Gallagher, J., Stewart, P.J., and Sweeney, J.

        RELEASED AND JOURNALIZED: June 21, 2012
ATTORNEYS FOR APPELLANTS

Darryl E. Pittman
James Alexander, Jr.
Pittman, Alexander Attorneys
2490 Lee Boulevard, Suite 115
Cleveland Heights, OH 44118

Michael Aten
The Leader Building
526 Superior Avenue, East
Suite 455
Cleveland, OH 44114


ATTORNEYS FOR APPELLEES

For Anthony Capuozzo

Anthony Capuozzo, pro se
35401 Euclid Avenue, #215
Willoughby, OH 44094

For Family Title Services, Inc., et al.

Family Title Services, Inc.
35401 Euclid Avenue #215
Willoughby, OH 44094

For Robert J. Hudak and Hudak Appraisal Services

Thomas J. Connick
James P. Sammon
Anthony J. Trzaska
Dubyak, Connick, Thompson & Bloom, LLC
3401 Enterprise Parkway, Suite 205
Cleveland, OH 44122
Also listed:
For Simon Zeller

William T. Zaffiro, Jr.
5495 Mayfield Road
Lyndhurst, OH 44124
SEAN C. GALLAGHER, J.:

       {¶1} Appellants, Cynthia Amir and Yohance Amir, appeal the rulings of the

Cuyahoga County Court of Common Pleas that excluded certain testimony and evidence

from trial and that granted a directed verdict against appellants on the claims presented at

trial. For the reasons stated herein, we affirm.

       {¶2} This case began as a foreclosure action brought against the Amirs by U.S.

Bank in 2006.     The action pertained to property located at 1415 E. 80th Street in

Cleveland (hereafter “the property” or “the home”). The Amirs purchased the property

on or about February 17, 2005, from Simon Zeller.

       {¶3} The Amirs filed an amended answer, counterclaim, and third-party complaint,

naming various third parties to the action, including the appellees, Robert J. Hudak and

Hudak Appraisal Services (collectively “Hudak”) and Anthony Capuozzo and Family

Title Services (collectively “Capuozzo”). The Amirs claimed that they were the victims

of a property-flipping scheme. They alleged that the appellees conspired with other

parties and induced them to purchase the property through fraudulent misrepresentations

and the use of false loan documents and a fraudulent appraisal.

       {¶4} The claims between U.S. Bank and the Amirs were settled, and the parties

entered a stipulated dismissal. Multiple other third-party defendants were dismissed over

the course of proceedings. The court eventually instructed all remaining parties to file a

notice of intent to proceed on pending claims. The Amirs filed a notice of intent to
proceed with their outstanding claims against Robert Hudak, Anthony Capuozzo, and

Family Title Services, as well as their claims for damages against Simon Zeller, against

whom summary judgment as to liability had been granted.1 The court issued an order

recognizing these claims remained and dismissed any other pending claims.

      {¶5} Among other motions, Hudak filed a motion in limine to exclude the

testimony of the Amirs’ proposed expert Donald Durrah on the basis that he failed to

establish an opinion of the property’s value to a reasonable degree of appraisal certainty.

Hudak also filed a motion in limine to exclude the proffer of any evidence or testimony of

any criminal convictions or pleas of any other present or former party to the case in an

attempt to infer liability against Hudak. These motions were granted by the trial court.

      {¶6} The Amirs’ case against Hudak and Capuozzo proceeded to trial on

appellants’ claims of fraud, civil conspiracy, violation of the Ohio Corrupt Practices Act,

and violation of the Ohio Consumer Sales Practices Act (“CSPA”). The Amirs only filed

a partial transcript of proceedings for review by this court, which is permitted by the

appellate rules. See App.R. 9(B). However, we are mindful that an appellant bears the

burden of demonstrating error and, in the absence of such an affirmative showing, this

court must presume the regularity of the trial court’s proceedings. See Weir v. Krystie’s

Dance Academy, 11th Dist. No. 2007-T-0050, 2007-Ohio-5910, ¶ 16; McEwen v. Doyle,

5th Dist. No. CA-8939, 1992 WL 330310 (Nov. 9, 1992).



      1
          The court later entered a judgment granting damages against Zeller.
      {¶7} Yohance Amir testified that when he first saw the home, it was under

renovation and had been freshly painted. It had seven bedrooms and one kitchen and

was represented as a single-family home. Each time he went into the home, he observed

workers in the house, and he described the house as looking “better and better.”

      {¶8} While meeting with Nick Myles of Central National Mortgage for financing,

Yohance observed comparables being faxed to Myles, who purportedly was on the phone

with Hudak. Yohance testified that Myles indicated the comparables reflected what the

home was worth. Yohance understood that the appraisal would have to support the

amount of the loan request. Yohance never met or spoke to Hudak. He claimed he

provided Myles with $400 for the cost of the appraisal.

      {¶9} Eventually, Myles informed Yohance that he could not get financed and his

wife’s credit would need to be used. Cynthia Amir signed the purchase agreement on

February 17, 2005.

      {¶10} Before closing, Yohance spoke with Capuozzo of Family Title, which

handled the title work for the home. Yohance was left with the impression that it was a

good deal. Yohance conceded his monthly payment would be less than he was currently

paying for rent. He also claimed he viewed a HUD statement that showed Hudak was to

be paid upon the settlement of the house.

      {¶11} Hudak viewed the home for the appraisal on or about March 10, 2005. He

issued an appraisal report on March 17, 2005, in which he valued the home at $100,000.

In his appraisal, Hudak indicated that the property was zoned two-family and that the
property had been converted to a single-family dwelling. He further indicated that the

property had been renovated throughout “in a very professional manner.”            Hudak

indicated in his deposition that he is not a home inspector or a construction expert.

Yohance did not see the appraisal until after moving into the house.

       {¶12} Yohance testified that ongoing work was being performed on the home right

up until the Amirs moved in on March 22, 2005. At one point, he viewed workers

cutting joists in the upstairs bathroom. The Amirs never obtained an inspector to inspect

the quality of work prior to purchasing the home.

       {¶13} After moving in, the Amirs encountered many problems with the

workmanship in the house, including the drywall work, plumbing work, flooring work,

and electrical work. They discovered that the home previously had two furnaces and that

one of the furnaces was removed. The Amirs made numerous repairs to the home and

claimed their energy bills increased dramatically. They did not offer evidence as to the

amount expended on repairs or produce any energy bills reflecting the increased costs.

       {¶14} Because the Amirs were unable to make their payments on the home, a

foreclosure action was brought against them. The Amirs were eventually relieved of the

debt on the home. At the time of trial, they were still residing in the home.

       {¶15} Angelo Michael Amato, who is a real estate investor and is in the

construction business, testified that he viewed the home in 2010 in connection with the

review of the property by Donald Durrah, who was the Amirs’ expert. Amato indicated

that the property was a two-family home that was not properly converted into a
single-family home and that it had multiple code violations. He testified to various

problems throughout the entire home and to his belief that the home had not been

properly renovated. He also testified to his belief that the home should be reconstructed

as a two-family home and estimated a cost of $85,000. He conceded that he did not view

the home in 2005, he was not aware of the condition of the home in 2005, and he was not

aware of what conditions may have changed in the home between 2005 and 2010. With

regard to Capuozzo and Family Title Services, Amato acknowledged that a title company

does not determine a value of property.

      {¶16} Ultimately, the trial court granted a directed verdict against the Amirs on all

claims. This appeal followed.2

      {¶17} The Amirs raise seven assignments of error for our review. Their first

assignment of error provides as follows: “1. The trial court abused its discretion when

it excluded the testimony of appellants’ expert witness Donald Durrah.”

      {¶18} A trial court’s decision concerning the admissibility of expert testimony is

reviewed for an abuse of discretion.       Valentine v. Conrad, 110 Ohio St.3d 42,

2006-Ohio-3561, 850 N.E.2d 683, ¶ 9. Likewise, a trial court’s ruling on a motion in

limine is reviewed for an abuse of discretion. Sokolovic v. Hamilton, 195 Ohio App.3d

406, 2011-Ohio-4638, 960 N.E.2d 510, ¶ 13 (8th Dist.). An abuse of discretion suggests




      2
          We note that Capuozzo and Family Title Services have not filed an
appellate brief.
unreasonableness, arbitrariness, or unconscionability in the trial court’s decision.

Valentine at ¶ 9.

       {¶19} An appraisal is defined as “a valuation of property by the estimate of an

authorized          person.”           Merriam-Webster          Online       Dictionary,

http://www.merriam-webster.com/dictionary/appraisal     (accessed    May    29,   2012).

Hudak’s appraisal valued the subject property at $100,000.

       {¶20} The Amirs sought to use their appraisal expert, Donald Durrah, to attack the

credibility of the appraisal performed by Hudak. In his report, Durrah identified several

purported misleading and incorrect statements in Hudak’s appraisal. He opined that the

appraisal was not performed in conformance with the Uniform Standards of Professional

Appraisal Practice.3 One of his primary concerns, as expressed in his deposition, was his

belief that the property had not actually been converted to a single-family home.

However, he had no evidence that Hudak intentionally misled anyone. He offers no

opinion as to what the value of the property should have been in March 2005 and

nowhere states that the value established by Hudak was incorrect. Further, he references

no other comparable homes from the relevant time to establish that the appraisal was

overinflated. Rather, as he expressed during his deposition, he would only be testifying

at trial to the alleged errors he found in Hudak’s report and how that affected the

credibility of the appraisal.


       3
        The applicable USPAP standards were not filed with the lower court and
are not in the record for review.
       {¶21} Insofar as the Amirs contend that Hudak made misrepresentations as to the

characteristics of the dwelling, the record reflects that the Amirs did not view the

appraisal report until after they moved into the home.4 As discussed later, the Amirs

failed to establish that they justifiably relied on the appraisal or were otherwise misled by

Hudak. Further, we are unpersuaded by the Amirs’ reliance on a Maryland case that

found evidence to support a claim of indirect reliance on the appraised value of property.

See Hoffman v. Stamper, 385 Md. 1, 867 A.2d 276 (Md.2005). The expert in that case

provided evidence of overinflated values by identifying comparable sales from the time of

the appraisal that were ignored.       Id.    Here, even accepting the argument that an

appraised value may be inherently relied upon in the purchase of property, there remains

no evidence that the appraised value was overinflated in this matter. In the absence of an

opinion on the property’s value at the time the appraisal was made, Durrah’s testimony

and his report were devoid of any evidentiary value in this case. See Urbanek v. All State

Home Mtge. Co., 178 Ohio App.3d 493, 2008-Ohio-4871, 898 N.E.2d 1015, ¶ 18 (8th

Dist.) (finding expert report that offered no opinion as to value failed to substantiate a

claim that appraisals were overinflated). Accordingly, we find no abuse of discretion by

the trial court in excluding this evidence.




       4
         This case is distinguishable from Natl. City Mtge. Co. v. Gingo Appraisal
Servs., Inc., 9th Dist. No. 24123, 2008-Ohio-4074. In Gingo, a lending institution
was in possession of an alleged negligent appraisal that was relied upon in lending
money against a property that went into foreclosure and resulted in an uninsured
loss.
       {¶22} The Amirs also claim that the trial court improperly excluded evidence of

the value of the property through the Cuyahoga County Fiscal Office.            The Amirs

intended to introduce evidence of the appraisal value through the county auditor. Neither

the witness nor this evidence was disclosed prior to trial, and Hudak had no opportunity

to depose the county’s appraiser. Because the admission of the evidence would have

resulted in an unfair surprise and been prejudicial to Hudak, the trial court’s decision to

exclude it was not an abuse of discretion.

       {¶23} Finding no abuse of discretion by the trial court, appellants’ first assignment

of error is overruled.

       {¶24} The Amirs’ second assignment of error provides as follows: “The trial court

abused its discretion in excluding the statements of Anthony Capuozzo and Nicholas

Myles detailing appellees’ participation in an enterprise engaged in property flipping and

mortgage fraud.”

       {¶25} The Amirs contend that statements from Capuozzo and Myles were

improperly excluded by the trial court. They sought to introduce these statements to

support their claim of a conspiracy.

       {¶26} There is nothing in the record before us that shows Capuozzo’s statement

was proffered into evidence at trial. A trial court’s ruling on a motion in limine is

tentative and precautionary in nature because the trial court is at liberty to change its

ruling on the disputed evidence at trial.      State v. Edwards, 107 Ohio St.3d 169,

2005-Ohio-6180, 837 N.E.2d 752, ¶ 17. As such, a ruling on a motion in limine may not
be appealed unless the claimed error is preserved by an objection made during trial. See

Gable v. Gates Mills, 103 Ohio St.3d 449, 2004-Ohio-5719, 816 N.E.2d 1049, ¶ 34.

Because the Amirs failed to proffer Capuozzo’s statement or object to its exclusion

during trial, they failed to preserve this challenge for appeal.

       {¶27} With regard to Myles’s statement, it is conceded that this evidence was

proffered at trial. A review of Myles’s statement reflects that it does not mention Hudak

or implicate him in the fraudulent scheme to which Myles confessed. Further, the sale of

the property to the Amirs was outside of the date range and not included in the properties

that were subject to the admitted scheme. The statement reflects that the first properties

involved in the scheme were purchased in March or April 2005, which was after the sale

of the property to the Amirs. Additionally, the consent judgment entry that was entered

in this case by Central National Mortgage and Nick Myles was ordered to have “no effect

on the Amirs’ claims against any other Third-Party Defendant.” Even if this evidence

were admissible and relevant to the conspiracy claim as argued by the appellants, the trial

court properly excluded it because its probative value was substantially outweighed by the

danger of unfair prejudice.         See Evid.R. 403(A).       Therefore, appellants’ second

assignment of error is overruled.

       {¶28} The Amirs’ third assignment of error provides as follows: “The trial court

erred when it granted appellees’ motion for directed verdict on all of appellants’ claims.”

       {¶29} We employ a de novo standard of review in evaluating the grant or denial of

a motion for directed verdict. Groob v. KeyBank, 108 Ohio St.3d 348, 2006-Ohio-1189,
843 N.E.2d 1170, ¶ 14.         A motion for directed verdict is properly granted if “the trial

court, after construing the evidence most strongly in favor of the party against whom the

motion is directed, finds that upon any determinative issue reasonable minds could come

to but one conclusion upon the evidence submitted and that conclusion is adverse to such

party.”     Civ.R. 50(A)(4).

          {¶30} Under this assignment of error, the appellants make a conclusive assertion

that the trial court failed to adhere to the standards for determining directed verdicts and

erroneously granted verdicts to appellees.        Because they fail to develop their argument

and do not cite to error in the record, we may disregard this assignment of error.        App.R.

12(A)(2) and 16(A)(7).       Further, we reiterate that our review is de novo.

          {¶31} The Amirs’ fourth assignment of error provides as follows: “The trial court

erred when it granted appellees’ motion for directed verdict on appellant’s fraud claim.”

          {¶32} To succeed on a fraud claim, a plaintiff must show

          (1) a representation (or concealment of a fact when there is a duty to
          disclose), (2) that is material to the transaction at hand, (3) made falsely,
          with knowledge of its falsity or with such utter disregard and recklessness
          as to whether it is true or false that knowledge may be inferred, and (4) with
          intent to mislead another into relying upon it, (5) justifiable reliance, and (6)
          resulting injury proximately caused by the reliance.

Volbers-Klarich v. Middletown Mgt., Inc., 125 Ohio St.3d 494, 2010-Ohio-2057, 929

N.E.2d 434, ¶ 27, citing Burr v. Bd. of Commrs. of Stark Cty., 23 Ohio St.3d 69, 73, 491

N.E.2d 1101 (1986).

          {¶33} Ohio appellate courts have recognized that an appraiser can be held liable in

tort for a negligently or fraudulently prepared appraisal despite the absence of privity.
E.g., Rece v. Dominion Homes, Inc., 10th Dist. No. 07-AP-295, 2008-Ohio-24;

Washington Mut. Bank v. Smith, 11th Dist. No. 2001-L-238, 2002-Ohio-6910; Perpetual

Fed. S. & L. Assn. v. Porter & Peck, Inc., 80 Ohio App.3d 569, 572, 609 N.E.2d 1324

(10th Dist.1992); but see Trustcorp Mtge. Co. v. Zajac, 1st Dist. No. C-060119,

2006-Ohio-6621 (declining to extend this view to appraisers). While the Ohio Supreme

Court has not examined the issue with respect to appraisers, it has found that “an

accountant may be held liable by a third party for professional negligence when that third

party is a member of a limited class whose reliance on the accountant’s representation is

specifically foreseen.” Haddon View Invest. Co. v. Coopers & Lybrand, 70 Ohio St.2d

154, 157, 436 N.E.2d 212 (1982) (applying Restatement of Torts 2d, 126-127 Section

552). The appellate courts have applied these same considerations to appraisers.

      {¶34} In Washington Mut., the court found that “an appraiser preparing a report for

a lending institution should foresee that the purchaser of the property listed on the

appraisal form could be within the limited class of persons who would rely on the

appraisal.” Id. at ¶ 26. The court recognized that purchasers have an obligation to

exercise their independent judgment when determining the value of the home they intend

to purchase. Id. at ¶ 27. However, the court noted that it “can foresee circumstances

where an unsophisticated consumer could be duped into the purchase of an overpriced

property acting in reliance on an appraisal that was negligently or fraudulently prepared.”

 Id. The court determined that “[u]nder this narrow set of circumstances, where the

purchaser can demonstrate reliance on the appraisal, recovery from the appraiser may be
appropriate.”   Recognizing that reliance on the appraisal must be shown, the court

averred that “[e]vidence that appellants executed the purchase agreement before receiving

a copy of the appraisal would strongly suggest * * * that the appellants did not rely on the

appraisal.” Id. at ¶ 29; see also Rece at ¶ 34-38 (evidence showed a lack of justifiable

reliance where appraisal was performed after the purchase contract was entered and the

appraisal was not read before closing on the home).

       {¶35} In this case, the appraised value of the property was predicated on the

home’s conversion to a single-family home. There was no evidence that the appraisal

was made with an intent to mislead the Amirs.          Further, Cynthia Amir signed the

purchase agreement before the appraisal was performed and Yohance testified that they

did not look at the appraisal until after they moved into the home. The fact that Yohance

observed comparables being faxed to Myles from Hudak was simply insufficient to

establish justifiable reliance on the appraisal or the representations contained therein.

The Amirs had ample opportunity to view the home and the work being performed

therein. They chose not to have an independent inspection performed upon the home.

Further, while the Amirs sought to undermine the credibility of the appraisal, they failed

to offer admissible evidence to establish that the house was not worth the appraised value.



       {¶36} Likewise, there was a lack of evidence to support any claim of justifiable

reliance on the documents prepared by Capuozzo.           Capuozzo’s testimony was not

included in the record for our review. While the Amirs claim there was evidence that
showed Capuozzo prepared multiple closing statements that misrepresented the amount of

closing costs and the amounts paid to the Amirs, there is no evidence that the Amirs

justifiably relied on these documents when making the decision to purchase the home.

Further, Capuozzo did not value the home.

      {¶37} Because there was a lack of evidence upon which reasonable minds could

find in favor of the Amirs, the appellees were entitled to a directed verdict on the fraud

claim. Appellants’ fourth assignment of error is overruled.

      {¶38} The Amirs’ fifth assignment of error provides, “The trial court erred when

it granted appellees’ motion for directed verdict on appellant’s civil conspiracy claim.”

Their sixth assignment of error provides, “The trial court erred when it granted appellees’

motion for directed verdict on appellants’ Corrupt Practices Act claims.”

      {¶39} To establish a civil-conspiracy claim, the plaintiff must prove: (1) a

malicious combination, (2) involving two or more persons, (3) causing injury to person or

property, and (4) the existence of an unlawful act independent from the conspiracy itself.

Urbanek, 178 Ohio App.3d 493, 2008-Ohio-4871, 898 N.E.2d 1015, ¶ 19 (8th Dist.),

citing Universal Coach, Inc. v. New York City Transit Auth., Inc., 90 Ohio App.3d 284,

292, 629 N.E.2d 28 (8th Dist.1993); see also Williams v. Aetna Fin. Co., 83 Ohio St.3d

464, 475, 1998-Ohio-294, 700 N.E.2d 859.         To prevail on a claim under the Ohio

Corrupt Practices Act for engaging in a pattern in corrupt activity, as defined under R.C.

2923.32(A)(1), a plaintiff must establish that the defendant was employed by or

associated with an enterprise and that the defendant directed or participated in the
enterprise’s affairs through a pattern of corrupt activity.     Morrow v. Reminger &

Reminger Co., L.P.A., 183 Ohio App.3d 40, 2009-Ohio-2665, 915 N.E.2d 696, ¶ 36 (10th

Dist.). “Corrupt activity” means “engaging in, attempting to engage in, conspiring to

engage in, or soliciting, coercing, or intimidating another person to engage in” certain

criminal offenses listed under R.C. 2923.31(I).

       {¶40}     When construed in a light most favorable to appellants, we find the

evidence in the limited record before us fails to show that appellees were involved in a

conspiracy or associated with an illegal enterprise. Further, the evidence fails to show

appellees were involved in an underlying fraud or engaged in any unlawful act.

Accordingly, appellees were entitled to a directed verdict on these claims, and we

overrule the fifth and sixth assignments of error.

       {¶41} The Amirs’ seventh assignment of error provides as follows: “The trial

court erred when it granted appellees’ motion for directed verdict on appellants’

Consumer Sales Practices Act claim.”

       {¶42} “The CSPA, which is contained in R.C. Chapter 1345, prohibits unfair or

deceptive acts and unconscionable acts or practices by suppliers in consumer

transactions.”   Colburn v. Baier Realty & Auctioneers, 11th Dist. No. 02-T-0161,

2003-Ohio-6694, ¶ 13. The Ohio Supreme Court has recognized that the CSPA has “no

application in a ‘pure’ real estate transaction.” Brown v. Liberty Clubs, Inc., 45 Ohio

St.3d 191, 193, 543 N.E.2d 783 (1989). However, the CSPA “is applicable to the

personal property or services portion of a mixed transaction involving both the transfer of
personal property or services and the transfer of real property.” Id. at syllabus. With

regard to collateral services that are solely associated with the sale of real estate and are

necessary to effectuate a “pure” real estate transaction, the CSPA does not apply. Hurst

v. Ent. Title Agency, 157 Ohio App.3d 133, 2004-Ohio-2307, 808 N.E.2d 689, ¶ 34-35

(11th Dist.); Colburn at ¶ 16.

       {¶43} The appraisal services performed by Hudak and the title services performed

by Capuozzo were collateral services solely associated with the sale of real estate.

Therefore, the claims involve a pure real estate transaction         and the CSPA is not

applicable. The trial court properly granted a directed verdict on this claim. Appellants’

seventh assignment of error is overruled.

       {¶44} Judgment affirmed.

       It is ordered that appellees recover from appellants 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 common

pleas 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.




SEAN C. GALLAGHER, JUDGE

MELODY J. STEWART, P.J., and
JAMES J. SWEENEY, J., CONCUR
