State ex rel. Cordray v. Miller ( 2011 )

[Cite as State ex rel. DeWine v. Miller, 194 Ohio App. 3d 86, 2011-Ohio-2107.]
IN THE COURT OF APPEALS OF OHIO
FOURTH APPELLATE DISTRICT
PIKE COUNTY
THE STATE EX REL. DEWINE, :
:
Appellant, : Case No. 10CA804
:
v. :
:
:
MILLER et al., : DECISION AND JUDGMENT ENTRY
:
Appellees. :
____________________________________________________________________________
APPEARANCES:
Michael DeWine, Attorney General, and John F. Cayton and Nicholas J. Bryan, Assistant
Attorneys General, for appellant.
Porter, Wright, Morris & Arthur and Christopher R. Schraff, for appellees Fred T. Miller
and Miller Salvage, Inc.
McMahon, Spetnagel & McMahon, Thomas M. Spetnagel, and Paige J. McMahon, for
appellee Miller Land Company.
____________________________________________________________________________
CIVIL APPEAL FROM COMMON PLEAS COURT
DATE JOURNALIZED: 4-21-11
ABELE, Judge.
{¶ 1} This is an appeal from a judgment that found Fred T. Miller and Miller Salvage,
Inc., defendants below and appellees here, in contempt of court. The state of Ohio ex rel.
Michael DeWine, Attorney General of Ohio, plaintiff below and appellant here, assigns the
following errors for review:
PIKE, 10CA804 2
First Assignment of Error:
The trial court erred when it held that Miller Land Company is not in
contempt for failure to comply with the provisions of the agreed judgment entry.
Second Assignment of Error:
The trial court abused its discretion when it failed to affirm the stipulated
penalties set out in the agreed judgment entry.
{¶ 2} In 1993, appellee Fred Miller started a wood-waste recycling business. In 1999,
he sold the business to his brother, Douglas Miller, for three million dollars. No payment was
made on the sale, however, and Douglas Miller, by and through his company W.D. Miller
Enterprises, L.L.C., operated the business for only two weeks before abandoning it.
Subsequently, Fred Miller again took over the business.
{¶ 3} In November 2001, appellant commenced the instant action and alleged various
violations of environmental laws and regulations promulgated under R.C. Chapter 3704.
Appellant sought, inter alia, a permanent injunction to bar appellees from further violation as
well as civil penalties.
{¶ 4} On April 15, 2005, the parties entered into an agreed judgment entry that resolved
the state’s motion for preliminary injunction (“the consent decree”). The consent decree
required appellees to take certain actions regarding, among other things, the construction and
operation of a “new leachate pond”1 and the removal of wood waste from an “old footprint.”2
1
“Leachate” is “a liquid that has percolated through soil, rock, or waste and has extracted dissolved or suspended
materials.” Ohio Adm.Code 1501:13-1-02(TTT). It logically follows that a “leachate collection pond” is a place to collect and
hold the water that contains those contaminants.
2
The consent decree defines the “old footprint” as “all areas containing wood waste as identified by” a topographic
survey.
PIKE, 10CA804 3
The consent decree also set out stipulated penalties for the failure to complete various actions.
Furthermore, the consent decree was to be binding both “upon the parties to [the] action” as well
as their “successors, and assigns.”
{¶ 5} In March 2006, unbeknownst to appellant, a portion of the contaminated property
was conveyed to another entity, the Miller Land Company. That company was subsequently
joined as a party defendant to the action.
{¶ 6} On November 7, 2006, appellant filed a motion to show cause why appellees
should not be held in contempt for the failure to comply with the consent decree's terms. The
matter then underwent a protracted process of discovery and hearing.
{¶ 7} On January 27, 2010, the trial court issued its decision and (1) sustained the
motion in part and overruled it in part, (2) found appellees Fred Miller and Miller Salvage, Inc. in
contempt of court, and (3) sentenced Fred Miller to 30 days in jail for contempt but suspended
that sentence to give him an opportunity to purge the contempt by paying $18,000 in stipulated
penalties to the state of Ohio.3
{¶ 8} With respect to the Miller Land Company, the trial court found insufficient
evidence to show that it was “an aider and abettor” to any violation or that it was in “active
concert or participation with the other [d]efendants” in violating the terms of the consent decree.
This appeal followed.
I
{¶ 9} In its first assignment of error, appellant asserts that the trial court erred when it
3
In its proposed findings of facts and conclusions of law, appellant calculated $1,700,000 as the stipulated penalties
owed under the consent decree.
PIKE, 10CA804 4
declined to hold the Miller Land Company in contempt of court. Specifically, appellant
contends that the court ignored the fact that the Miller Land Company is a successor/assignee of
the Miller brothers’ family business and that Fred Miller, its principal, was aware of the
proceedings against the property.
{¶ 10} Our analysis begins with the principle that a trial court enjoys broad discretion
when considering a contempt motion and its judgment should not be reversed absent an abuse of
discretion. In re T.B., Athens App. No. 10CA04, 2010-Ohio-2047, at ¶ 37; Welch v. Muir,
Washington App. No. 08CA32, 2009-Ohio-3575, at ¶ 10. Generally, an abuse of discretion is
more than an error of law or judgment; rather, it implies that a trial court's attitude is
unreasonable, arbitrary, or unconscionable. Landis v. Grange Mut. Ins. Co. (1998), 82 Ohio St. 3d
339, 342, 695 N.E.2d 1140; Malone v. Courtyard by Marriott L.P. (1996), 74 Ohio St. 3d 440,
448, 659 N.E.2d 1242. Furthermore, when applying the abuse-of-discretion standard, reviewing
courts may not substitute their judgment for that of the trial court. State ex rel. Duncan v.
Chippewa Twp. Trustees (1995), 73 Ohio St. 3d 728, 732, 654 N.E.2d 1254; In re Jane Doe 1
(1991), 57 Ohio St. 3d 135, 137-138, 566 N.E.2d 1181.
{¶ 11} In the case sub judice, we reject appellant’s arguments for several reasons. First,
as the trial court noted, the Miller Land Company was not a party to the consent decree. Indeed,
it was not a party to the action until March 19, 2007, approximately two years after the consent
decree. Second, even if the trial court did err, we fail to see how appellant has suffered
prejudice. Appellant recognizes that Fred Miller is the principal of the Miller Land Company,
and Miller was found in contempt and will serve jail time unless he purges himself of that
contempt. Third, the trial court’s finding is based on its own evaluation of the evidence at the
PIKE, 10CA804 5
hearing. Here, the trial court sat as trier of fact and apparently determined that the evidence is
insufficient to show that the Miller Land Company is in contempt. We will not second guess
that determination.
{¶ 12} We further point out that if a court possesses the inherent power to punish
contemptuous conduct, it also possesses the power to determine what type of conduct constitutes
contempt. State ex rel. Turner v. Albin (1928), 118 Ohio St. 527, 535, 161 N.E. 792. This
court and others have held that trial courts may decline to hold a party in contempt,
notwithstanding uncontroverted evidence that a court order has been violated. See, e.g.,
McClead v. McClead, Washington App. No. 06CA67, 2007-Ohio-4624, at ¶ 32; In re Skinner
(Mar. 23, 1994), Adams App. No. 93CA547; see, e.g., Kilcoyne Properties, L.L.C. v. Fischbach,
Licking App. No. 03CA072, 2004-Ohio-7272, at ¶ 97. Thus, even though appellant may have
presented convincing evidence, it is within the trial court’s discretion to refuse to find the Miller
Land Company in contempt.
{¶ 13} Based upon the foregoing reasons, we find nothing arbitrary, unreasonable, or
unconscionable in the trial court's decision not to find the Miller Land Company in contempt.
Accordingly, we hereby overrule the first assignment of error.
II
{¶ 14} Appellant’s second assignment of error asserts that the trial court's decision
regarding the sanction against appellee Fred Miller constitutes reversible error. Specifically,
appellant argues that in light of the fact that the $18,000 penalty against Miller is less than two
percent of the stipulated penalties set out in the consent decree, the court's sanction effectively
waives almost all the penalties to which the parties stipulated.
PIKE, 10CA804 6
{¶ 15} The issue whether a trial court must impose stipulated penalties set forth in a
consent decree as a sanction for contempt appears to be one of first impression.4 One Ohio case
that involved that issue saw the issue formally withdrawn during oral argument. See State ex
rel. Petro v. Earl, Richland App. No. 2004-CA-28, 2005-Ohio-1049, at ¶ 22. We observe,
however, that the United States Court of Appeals for the Third Circuit reviewed, and upheld, a
lower court's imposition of stipulated penalties as not constituting an abuse of discretion. See
Harris v. Philadelphia (C.A.3 1995), 47 F.3d 1311, 1325. This may suggest that the court
believed that the trial court also possessed the discretion not to impose stipulated penalties.
{¶ 16} Generally, a contempt sanction is reviewed under the abuse-of-discretion
standard. See Mitchells Salon & Day Spa, Inc. v. Bustle, Hamilton App. No. C-0900349,
2010-Ohio-1880, at ¶ 23; DeMarco v. DeMarco, Franklin App. No. 09AP-405, 2010-Ohio-445,
at ¶ 25; Myer v. Myer, Muskingum App. No. CT2009-0014, 2009-Ohio-6884, at ¶ 19. We again
note that to establish an abuse of discretion, an appellant must show that a decision is
unreasonable, unconscionable, or arbitrary.
{¶ 17} During the trial court proceedings, some evidence was adduced concerning Fred
Miller's financial resources and, as the trial court characterized it, the “ability-to-pay analysis of
4
We recognize that a consent decree is a settlement that is contained in a court order. In other words, a consent
order is a contract based upon the parties' agreement. Courts are not generally free to modify the terms of the decree absent
certain circumstances, including the parties' consent, changed factual conditions, or unforeseen events.
In the case sub judice, we emphasize that our decision is guided by the procedural mechanism that appellant chose to
employ. Ohio case law is replete with examples of motions to enforce consent decrees. See, e.g., Johnson v. Wilkinson
(1992), 84 Ohio App. 3d 509, 513, 617 N.E.2d 707; Baird v. SDG, Inc., Wayne App. No. 05CA0030, 2005-Ohio-6605; Johnson v.
Morris (Dec. 13, 1993), Ross App. No. 93CA1969; Morgan v. Tillotson (Feb. 4, 1983), Lake App. No. 9-119. Here, the
state of Ohio chose to forego such a motion and instead sought to invoke the remedy of contempt. In our view, this action
placed the proceedings squarely within the trial court’s discretionary purview. Had the state of Ohio filed a motion to
enforce the consent decree, the trial court’s decision, as well as our decision, may very well have been different.
PIKE, 10CA804 7
the Defendants.” Although the trial court did not make extensive findings on the matter, it did
note that the “Defendants had the ability to contribute toward the stipulated penalties.” That
statement suggests that the court found the penalties that appellant sought to be onerous and
beyond appellees’ means. Further, although the consent decree is considered a contract between
the parties, it is also an order of the court. Trial courts must be afforded considerable leeway as
to the manner in which they enforce their orders. The purpose of civil contempt is to coerce
compliance with a previous court order. Slone v. Slone (Feb. 11, 2002), Pike App. No. 01CA665;
State v. Newman (Apr. 3, 1998), Scioto App. Nos. 97CA2507 and 97CA2525. Here, the trial
court may well have concluded that at this juncture the stipulated penalties were completely
beyond the appellees' ability to pay. However, an $18,000 penalty may have been viewed as
feasible and within their ability to pay.
{¶ 18} To the extent that appellant’s arguments are centered on the amount of the
sanction and that the sanction is less than two percent of the stipulated penalty, we refuse to be
drawn into setting a fixed percentage below which damages in the context of a contempt citation
constitute an abuse of discretion. Trial courts are in a much better position than this court to
adjudicate the facts and to determine what is best under each situation.
{¶ 19} The appellant cites State ex rel. Rogers v. Republic Environmental Sys. (Ohio),
Inc., (Oct. 9, 2009), Montgomery C.P. No. 1998CV03449, which it claims contains facts similar
to those at issue in the case sub judice. That court pondered whether to impose stipulated
penalties in a similar consent decree in light of the fact that the “aggregate amounts are
disproportionate to the nature and environmental impact of the violations.” In the end, the
Montgomery County Court of Common Pleas believed that it did not possess the authority to
PIKE, 10CA804 8
deviate from the stipulated penalties. In the case sub judice, appellant contends that the trial court
should have imposed the stipulated penalties and its refusal to do so constitutes reversible error.
We disagree for several reasons.
{¶ 20} First, this court is not bound by trial court decisions from our district or any other.
Chautauqua Park Apts. v. McMullen (Oct. 14, 1992), Highland App. No. 791; State v. Perotti
(May 15, 1991), Scioto App. No. 89CA1845, 1991 WL 87303. For that matter, neither is the
trial court in the case at bar.
{¶ 21} Second, the issue cited in Republic Environmental Sys. is whether the penalties
were disproportionate to environmental injury inflicted. By contrast, the issue here is the trial
court's concern about the appellees' ability to pay those penalties.
{¶ 22} Finally, and more important, we are not persuaded that Republic Environmental
Sys. necessarily conflicts with the trial court's actions in the case sub judice. The Montgomery
County Court of Common Pleas exercised its discretion one way, while the Pike County
Common Pleas Court exercised its discretion another way. Again, trial courts are afforded
broad discretion in contempt cases and must be given broad flexibility to decide cases in the
manner they think best.
{¶ 23} For these reasons, we find that the trial court sanction does not constitute abuse of
discretion and we hereby overrule appellant's second assignment of error.
{¶ 24} Having reviewed all of the errors assigned and argued, we hereby affirm the trial
court's judgment.
Judgment affirmed.
PIKE, 10CA804 9
MCFARLAND, J., concurs.
KLINE, J., concurs as to Assignment of Error I and concurs in judgment only as to
Assignment of Error II.