Parkstone Capital Partners v. Solon , 2013 Ohio 3149 ( 2013 )

[Cite as Parkstone Capital Partners v. Solon, 2013-Ohio-3149.]
Court of Appeals of Ohio
EIGHTH APPELLATE DISTRICT
COUNTY OF CUYAHOGA
JOURNAL ENTRY AND OPINION
No. 99241
PARKSTONE CAPITAL PARTNERS
PLAINTIFF-APPELLEE
vs.
CITY OF SOLON, OHIO
DEFENDANT-APPELLANT
JUDGMENT:
AFFIRMED
Civil Appeal from the
Cuyahoga County Court of Common Pleas
Case No. CV-674430
BEFORE: Stewart, A.J., S. Gallagher, J., and E.A. Gallagher, J.
RELEASED AND JOURNALIZED: July 18, 2013
ATTORNEYS FOR APPELLANT
Thomas G. Lobe
Thomas G. Lobe Co., L.P.A.
614 West Superior Avenue, Suite 1300
Cleveland, OH 44113
Todd D. Cipollo
Todd D. Cipollo Co., L.P.A.
33977 Chardon Road, Suite 100
Willoughby, OH 44094
ATTORNEY FOR APPELLEE
Kenneth J. Fisher
Kenneth J. Fisher Co., L.P.A.
2100 Terminal Tower
50 Public Square
Cleveland, OH 44113
ATTORNEY FOR INTERVENORS
Warner Mendenhall
190 North Union Street, Suite 201
Akron, OH 44304
MELODY J. STEWART, A.J.:
{¶1} Plaintiff Parkstone Capital Partners (“Parkstone”) brought this declaratory
judgment action against the defendant city of Solon asking the court to declare that a
single family residential zone in the city was unconstitutional as applied to a parcel of
land that it owned, and rezone it to two-family residential. The court declared the zoning
ordinance unconstitutional and ordered the city to conduct an election to approve the
rezoning. After the electorate soundly voted against the zoning change, the court
judicially ordered the zoning changed to two-family residential. The city appeals and
offers four arguments in support of reversing the court’s judgment: three procedural and
one substantive. The procedural arguments claim that Parkstone failed to exhaust its
administrative remedies when it dismissed an earlier action on the same zoning issue.
The substantive argument is that the court had no authority to judicially rezone the land
without a hearing.
I
{¶2} The parties stipulated the facts and do not otherwise contest the relevant
procedural posture of the case.
{¶3} The property in question is unimproved land consisting of three permanent
parcel numbers, none of which is one acre or more in size. It is located at the southeast
quadrant of State Route 91 (SOM Center Road) and Miles Road, in a section of the city
zoned R-1-D, single family residential. The R-1-D classification allows only single
family residences on a minimum lot size of one acre and further requires a minimum road
frontage of 90 feet. The southwest quadrant of the intersection is likewise zoned R-1-D
single family residential while the remaining two quadrants (northeast and northwest) are
zoned C-4 motor service commercial. The C-4 classification “is an intensive commercial
district that permits a range of uses including gas stations, automobile sales, motels, fast
food and sit-down restaurants, and office uses.”
{¶4} Parkstone purchased the land in May 2006, aware that the land was zoned
single family residential. It asked the city planning commission to rezone the property to
C-4 motor service commercial. The city charter mandates that all zoning changes are
subject to approval by a majority of the electors, so any requested zoning change is
contingent upon the city council passing an ordinance to place the rezoning request on the
ballot. In August 2008, the city council voted down an ordinance that would place
Parkstone’s rezoning request on the ballot.
{¶5} Parkstone filed an administrative appeal with the court of common pleas in
Cuyahoga C.P. No. CV-669169. As that appeal was pending, Parkstone filed this
declaratory judgment action, Cuyahoga C.P. No. CV-674430, in October 2008. This
case was assigned to a different judge. The complaint sought a declaration that the
R-1-D single family residential district zoning was unconstitutional as it applied to
Parkstone’s property because none of the approved uses for the property under the current
zoning classification were “reasonable, practical or economically available for use on the
Property” or would be so limiting that those uses would leave the property “undeveloped
and void.” Parkstone asked the court to rezone the property as C-4 motor service
commercial.
{¶6} When the city sought to consolidate CV-674430 with CV-669169, Parkstone
filed a Civ.R. 41(A) notice of voluntary dismissal without prejudice in CV-669169. The
court then denied the motion to consolidate as moot.
{¶7} In July 2009, Parkstone filed its second amended complaint and changed its
position regarding the rezoning classification it desired. While maintaining its previous
position that the R-1-D single family residence zoning classification was unconstitutional
as applied to the property, it abandoned its request that the court rezone the property to
C-4 motor service commercial. Instead, it asked the court to rezone the property to an
R-2 two-family residential classification.
{¶8} After the court denied the city’s motion for summary judgment, the parties
offered the following “stipulation of law”:
The Court has jurisdiction to determine the constitutionality of the current
zoning. If the Court determines that the current zoning is unconstitutional,
according to case law, the Court may order the City to rezone the property
in a constitutional manner. See Union Oil v. City of Worthington (1980),
62 Ohio St.2d 263. Article XIV, Sections 1 and 2, of Solon’s Charter
mandate that all zoning changes be approved by a majority of the electors
voting in the City and in each ward in which a zoning change is applicable.
Thus, the City may propose a zoning change with regard to this property on
the ballot in May 2010. The Plaintiffs would thus reserve the right to come
back to Court in the event the electorate rejects the rezoning on the ballot in
May 2010 and have this Court judicially rezone the Property in a
constitutionally permissive manner; i.e. R-2 Two Family Residential
District.
{¶9} In February 2010, the court ruled that the subject lots are not platted within
the one acre requirement of a R-1-D single family district and that “the buffering of the
adjacent residential lots serves to exclude the subject lots rather than having an
incorporating effect.” It found that development of two of the three parcels that fronted
on State Route 91 would result in driveway access less than the suggested 250 foot
minimum from an intersection as established by the State Highway Access Management
Manual. It also found that the traffic on both State Route 91 and Miles Road was
“significant” and not conducive to single family residential development. Based on these
findings, it found it “beyond fair debate” that the R-1-D single family residential district
zoning classification was, as applied to the properties, unconstitutional because it was
arbitrary, unreasonable, and without substantial relation to the public health, safety,
morals, or general welfare of the community. The court ordered the city to “rezone the
subject properties in a constitutional manner.” It further ordered that in the event the city
placed the rezoning request on the May 2010 ballot and the electorate rejected the
rezoning, Parkstone “may return to this court and have it judicially rezone the Property in
a constitutionally permissive manner.”
{¶10} The city did not have sufficient time to put the requested zoning change on
the May 2010 ballot, so it was placed on the November 2010 ballot. The electorate
overwhelmingly defeated Parkstone’s rezoning request: 7,769 opposed to 1,267 in favor.
Parkstone then asked the court to judicially rezone the property to the R-2 two-family
residential classification. The city obtained new counsel and responded with a motion to
dismiss the complaint on grounds that Parkstone failed to exhaust its administrative
remedies by dismissing CV-669169 — the case in which the city council refused to place
the rezoning issue on the ballot.
{¶11} The city also filed a motion for relief from judgment, arguing that the
stipulations filed by the parties did not give the court the authority to enter judgment. It
argued that the stipulations did not purport to resolve all factual issues, but only those on
which the parties could agree. In addition, the city claimed that stipulations were
intended only to provide a procedural mechanism “should the Court determine the zoning
unconstitutional as applied.”
{¶12} The court essentially overruled the motion for relief from judgment by
asking the parties to submit “good faith arguments as to the implementation of this
Court’s constitutional rezoning of the subject properties,” specifically stating that it would
not entertain any argument that the prior R-1-D zoning should be maintained. It then
ordered the Parkstone properties rezoned to R-2 two-family residential and ordered
Parkstone to submit a new site plan providing for six attached, single-family residences in
compliance with the R-2 use classification.
II
{¶13} The procedural questions in this appeal center on Parkstone’s filing of
CV-669169 and subsequent dismissal of the action. The city maintains first that the
court should have consolidated the present case, CV-674430, with the earlier case.
Second, it argues that by dismissing CV-669169, Parkstone failed to exhaust its
administrative remedies and should have been barred from prosecuting the present
declaratory judgment action.
A
{¶14} Civ.R. 42(A) allows the court to consolidate cases “involving a common
question of law or fact.” The key factors for the court to consider when ordering
consolidation are the commonality of issues and whether the parties are substantially the
same. Waterman v. Kitrick, 60 Ohio App.3d 7, 14, 572 N.E.2d 250 (10th Dist.1990).
The usual purpose for consolidation is convenience and to promote judicial economy.
Transcon Bldrs., Inc. v. Lorain, 49 Ohio App.2d 145, 150, 359 N.E.2d 715 (9th
Dist.1976), citing Johnson v. Manhattan Ry. Co., 289 U.S. 479, 496-497, 53 S.Ct. 721, 77
L.Ed. 1331 (1933).
{¶15} Parkstone filed its complaint in CV-674430 on October 24, 2008. The case
designation form filed with the complaint indicated that the case was related to
CV-669169, which was then pending before another judge. The city filed its motion to
consolidate CV-674430 with CV-669169 on November 20, 2008. The following day,
November 21, 2008, Parkstone dismissed CV-669169 without prejudice.
{¶16} In the ordinary practice, the court would have consolidated the cases under
Loc.R. 15(H) of the Cuyahoga County Rules of the Court of Common Pleas, General
Division. That rule essentially restates Civ.R. 42(A) and allows the court to consolidate
actions involving a common question of law or fact. The limitation on consolidation is
that the court must consolidate within 120 days after the complaint is filed. See Loc.R.
15(I) of the Cuyahoga County Rules of the Court of Common Pleas, General Division.
{¶17} Parkstone’s reasons for dismissing CV-669169 are unclear, but Civ.R.
41(A) provides an absolute right to voluntary dismissal. Strum v. Strum, 63 Ohio St.3d
671, 675, 590 N.E.2d 1214 (1992). And once a case is voluntarily dismissed, it is as
though the case never existed. Zimmie v. Zimmie, 11 Ohio St.3d 94, 95, 464 N.E.2d 142(1984). So Parkstone’s dismissal of CV-669169, coming before the court had the
opportunity to rule on the motion to consolidate, meant that the court no longer had a
second case for consolidation. The court correctly found that the motion to consolidate
was rendered moot by the dismissal.
B
{¶18} The city next argues that Parkstone’s dismissal of CV-669169 constituted a
failure to exhaust administrative remedies.
{¶19} The concept behind the exhaustion of administrative remedies is to
“‘prevent premature interference with agency processes’” by allowing administrative
agencies to correct their own errors and to allow the parties and reviewing courts to
benefit from the expertise that administrative bodies develop through experience.
Dworning v. Euclid, 119 Ohio St.3d 83, 2008-Ohio-3318, 892 N.E.2d 420, ¶ 9, quoting
Weinberger v. Salfi, 422 U.S. 749, 765, 95 S.Ct. 2457, 45 L.Ed.2d 522 (1975).
{¶20} “The doctrine of failure to exhaust administrative remedies is not a
jurisdictional defect to a declaratory judgment action; it is an affirmative defense that may
be waived if not timely asserted and maintained.” (Emphasis added.) Jones v. Chagrin
Falls, 77 Ohio St.3d 456, 674 N.E.2d 1388 (1997), syllabus. Affirmative defenses under
Civ.R 8(A) are not self-executing and must be “maintained” by way of a motion —
usually a motion for summary judgment because affirmative defenses typically require
reference to materials outside the complaint and are thus unamenable to disposition by
means of a Civ.R. 12(B)(6) motion. Schneider v. Cuyahoga Cty. Bd. of Cty. Commrs.,
8th Dist. No. 98936, 2013-Ohio-1900, ¶ 10, citing State ex rel. Freeman v. Morris, 62
Ohio St.3d 107, 109, 579 N.E.2d 702 (1991).
{¶21} Although the city listed the failure to exhaust administrative remedies as an
affirmative defense in its answer to the complaint, it did not timely maintain the defense
because it waited more than two years before raising it as the subject of a motion to
dismiss: Parkstone filed its initial complaint in October 2008, but the city did not file a
motion to dismiss the complaint on that basis until June 2011. Although Parkstone twice
amended its complaint, the latest amendment occurred in August 2009, so it still waited
nearly two years from the date of the last amendment before seeking dismissal.
{¶22} More problematic for the city is that it waited to file its motion to dismiss
the complaint for failure to exhaust administrative remedies until after the court declared
the zoning unconstitutional as it applied to the Parkstone property; after the court denied
the city’s motion to reconsider that declaratory judgment; after the rezoning had been
placed on the ballot and rejected by the voters; and after Parkstone applied for a judicial
rezoning consistent with the court’s declaratory judgment. It is sometimes said that the
doctrine of exhaustion of administrative remedies is “a court-made rule of judicial
economy.” G.S.T. v. Avon Lake, 48 Ohio St.2d 63, 65, 357 N.E.2d 38 (1976). The
city’s decision to maintain its affirmative defense after all the legal issues had been
resolved by the court undermined any proper notion of judicial economy. The city
should have raised the issue immediately after Parkstone dismissed CV-669169. By
waiting as long as it did, it forfeited the right to maintain the affirmative defense and
argue it at this stage.
C
{¶23} In its final procedural argument, the city argues that the court judicially
rezoned the property by considering facts not in evidence, and not the subject of the
stipulations. The city also argues that the parties were not afforded the benefit of a
hearing where the facts and arguments could be considered.
1
{¶24} At the outset, we note that there is no right to a jury trial in a declaratory
judgment action to challenge the validity of a zoning ordinance. Clark v. Woodmere, 28
Ohio App.3d 66, 67, 502 N.E.2d 222 (8th Dist.1985). To the extent the city argues that
the court’s judgment violated its right to a trial by jury, we reject it.
2
{¶25} The city also argues that the court erred by proceeding to judgment on the
stipulations and briefs of the parties because its stipulations were not intended to be
all-encompassing on every issue of fact, but instead were stipulations only as to the facts
on which the parties agreed. The city claims it had other evidence, which Parkstone
would not stipulate to, that it desired to place before the court for hearing. It argues that
the court’s rush to judgment meant that the evidence was not considered.
{¶26} Although the court originally denied the motions for summary judgment
filed by both parties (one of which was rendered after the parties submitted their
stipulations of fact), the judgment the court rendered was premised on the stipulations of
fact and law, and thus impliedly, if not explicitly, requested by the parties. Indeed, the
city’s only objection to the February 2010 judgment, contained in a motion for
reconsideration, was to ask the court to amend the judgment entry to state that the
city-wide ballot on rezoning the land would occur in November 2010, not May 2010, as
the court originally ordered. This motion gave no indication that the city believed the
court exceeded its authority by rendering judgment, so the city impliedly concurred in the
manner in which judgment issued. Its attempt to raise factual issues after summary
judgment had issued was untimely.
{¶27} What is more, the city waited some 16 months after the court declared the
R-1-D zoning classification unconstitutional as applied to the Parkstone property before it
raised the manner in which the court issued judgment as an issue in a motion for relief
from judgment. This motion, filed after the city obtained new counsel, was fatally
flawed because it failed to state that the motion was timely made as required by Civ.R.
60(B). See Svoboda v. Brunswick, 6 Ohio St.3d 348, 351, 453 N.E.2d 648 (1983)
(failure to establish all three essential elements of a Civ.R. 60(B) motion for relief from
judgment requires that motion be denied). In fact, it would be difficult to see how the
city could plausibly claim that its motion for relief from judgment was timely made when
it waited some 16 months to raise any objection to the manner in which the court
proceeded to judgment. Because the city had no objection to the court granting judgment
on the briefs, stipulations, and exhibits of the parties, its failure to raise any error at the
time indicated that it agreed with the manner in which the court proceeded to judgment.
III
{¶28} The substantive issue raised by the city is that the court erred by ordering the
city to conduct a rezoning election and then ignored the results of that election to
judicially rezone the property contrary to the clear mandate issued by the voters.
{¶29} It is unclear why the court, having declared the R-1-D zoning classification
unconstitutional as applied to the Parkstone properties, nonetheless ordered the parties to
propose a zoning change by ballot. The court’s order left no doubt that it intended to
rezone the land judicially even if the voters rejected the zoning, so the ballot measure was
perfunctory.
{¶30} The court may have thought it was implementing the wishes of the parties,
as expressed in their stipulations, to conduct an election on a rezoning request in a manner
consistent with the city charter. The parties recognized that the city charter required that
all zoning changes be approved by a majority of the electors in the city and a majority of
the electors in the ward in which the zoning change is requested, so perhaps the parties
were simply trying to effect the zoning change in this manner. If indeed that was the
motivation behind the election, the court should not have been a part of that decision.
The court made it clear that it would judicially rezone the property regardless of how the
citizens voted. This had the effect of telling the citizens of Solon that their votes did not
matter. We fail to see why the court ordered the election if it had already determined that
the R-1-D zoning classification was unconstitutional and had stated its intention to rezone
the property in a constitutionally permissive manner.
{¶31} Despite our criticisms of the manner in which the court allowed the election
to occur, we find no legal error. The city does not specifically argue that the court erred
by finding the R-1-D zoning classification unconstitutional as applied to the Parkstone
property, at least not in a manner that comports with its App.R. 16(A)(7) requirement to
file a brief that contains a separate argument with citations to authority. The city’s
“argument” is contained in a single sentence: “In the instant case, the record is
completely void [sic] of any evidence that Solon’s zoning regulation is clearly arbitrary
and unreasonable and without substantial relation to the public health, safety, morals, or
general welfare of the community.” This is a conclusion, not an argument.
{¶32} In addition, the city ignores the evidentiary material Parkstone offered in
support of its own motion for summary judgment and in opposition to the city’s motion
for summary judgment. That evidence, as found by the court, indicated that retention of
the R-1-D single family residential classification posed a potential safety threat because
driveway access on Route 91 would be less than the recommended 250 foot minimum set
forth in the State Highway Access Management Manual. The court also found that the
volume of traffic at the intersection of Route 91 and Miles Road was significant and not
conducive to a single family development. These were significant factors, fully
supported by the evidence, justifying the court’s judgment. And it bears noting that the
city’s argument before this court does not actually cite any of its own evidence to show
why the court erred in Parkstone’s favor. The recitation of legal conclusions without
reference to facts will not suffice to show reversible error.
{¶33} Judgment affirmed.
It is ordered that appellee recover of appellant its costs herein taxed.
The court finds there were reasonable grounds for this appeal.
It is ordered that a special mandate issue out of this court directing the Cuyahoga
County Court of Common Pleas to carry this judgment into execution.
A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of
the Rules of Appellate Procedure.
MELODY J. STEWART, ADMINISTRATIVE JUDGE
SEAN C. GALLAGHER, J., and
EILEEN A. GALLAGHER, J., CONCUR