DocketNumber: No. 07AP-490.
Citation Numbers: 2007 Ohio 7147
Judges: BROWN, J.
Filed Date: 12/31/2007
Status: Precedential
Modified Date: 7/6/2016
{¶ 2} On November 7, 2006, Ohio voters approved a ballot initiative to enact the provisions of R.C. Chapter 3794.01 et seq., titled "The SmokeFree Workplace Act" (hereafter "the SmokeFree Act" or "the Act"). According to the stated purpose of the SmokeFree Act, "it is in the best interests of public health that smoking of tobacco products be prohibited in public places and places of employment[.]" R.C.
{¶ 3} Pursuant to R.C.
{¶ 4} On April 13, 2007, OLBA filed a complaint against ODH and its director (collectively "appellants"), seeking a declaratory judgment, injunctive relief, and a petition for a writ of mandamus. In the complaint, OLBA alleged that ODH had attempted to improperly expand a limited statutory exemption to the SmokeFree Act so as "to create an expansive loophole for `private clubs' that threatens to fundamentally erode the smoking ban enacted by the people, and give so-called `private clubs' a massive competitive and commercial advantage over other Ohio businesses." More specifically, OLBA challenged ODH's promulgation of Ohio Adm. Code
{¶ 5} On April 16, 2007, OLBA filed an amended complaint. On April 30, 2007, the trial court issued a temporary restraining order enjoining ODH from implementing and/or enforcing Ohio Adm. Code
{¶ 6} On May 14, 2007, the trial court conducted a hearing on the matter, and the parties submitted briefs in support. On May 17, 2007, the trial court issued a decision and entry granting OLBA's petition for a permanent injunction, finding that OLBA had standing to bring the petition, and that ODH had exceeded its authority in promulgating Ohio Adm. Code
{¶ 7} On June 11, 2007, appellants filed a notice of appeal from the trial court's entry. On June 18, 2007, OLBA filed a notice of cross-appeal, and notice of conditional cross-appeal. On September 24, 2007, this court granted a motion by the Ohio Restaurant Association to file an amicus brief.
{¶ 8} On appeal, appellants set forth the following two assignments of error for this court's review: *Page 4
Assignment of Error No. One — The trial court erred in holding that R.C. Chapter 3794 does not include a private club exemption.
Assignment of Error No. Two — The trial court erred in finding that Appellee/Cross-Appellant OLBA had standing to sue.
{¶ 9} In its brief in response to appellants' assignments of error, OLBA raises the following conditional cross-assignment of error:
If defendants are granted relief in the form of a holding that the Ohio Smoke Free Workplace Act is so internally flawed as to require amendment through agency rule, then the entirety of the Act should be stricken as void for vagueness and violative of due process.
{¶ 10} On cross-appeal, OLBA sets forth the following two cross-assignments of error:
I.The Trial Court Erred In Denying Plaintiff's Motion In Limine To Exclude 2006's State Issue 5 Ballot Language From This Case, Given That Ohio's Constitution Establishes That The Time For Challenging Ballot Language Had Long Since Passed.
II.The Trial Court Erred In Granting Defendants' Motion To Quash Plaintiff's Subpoena For Trial Testimony From The Acting Director Of The Ohio Department Of Health, A Named Party In This Matter.
{¶ 11} We begin with appellants' two assignments of error, which we will address in inverse order. Under their second assignment of error, appellants challenge the trial court's finding that OLBA had standing to bring the underlying complaint. Appellants argue that OLBA, as a trade organization suing on behalf of itself and its members, did not meet the requirements of associational standing necessary to challenge the private club exemption. Appellants maintain that OLBA's assertion its members would suffer injury is insufficient to confer standing. *Page 5
{¶ 12} This court has previously noted that a permanent injunction "is an equitable remedy that will be granted only where the act sought to be enjoined will cause immediate and irreparable injury to the complaining party and there is no adequate remedy at law." Franklin Cty. Dist. Bd.of Health v. Paxson,
{¶ 13} R.C.
An action for a declaratory judgment to determine the validity of an administrative agency regulation may be entertained by a court, in the exercise of its sound discretion, where the action is within the spirit of the Declaratory Judgment Act, a justiciable controversy exists between adverse parties, and speedy relief is necessary to the preservation of rights which may otherwise be impaired or lost.
{¶ 14} In Thompson v. Hayes, Franklin App. No. 05AP-476,
* * * [A] trade association that has not suffered any injury nonetheless has standing on behalf of its members if (a) its members would otherwise have standing to sue in their own right; (b) the interests the association seeks to protect are germane to the association's purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit. Hunt v. Washington State Apple Advertising Comm. (1977),
432 U.S. 333 ,343 ,97 S.Ct. 2434 ,53 L.Ed.2d 383 ; Ohio Hosp. Assoc. v. Community Mut. Ins. Co. (1987),31 Ohio St.3d 215 ,218 ,31 Ohio B. 411 ,509 N.E.2d 1263 ."However, to have standing, the association must establish that its members have suffered actual injury." Ohio Contractors Assn. v. Bicking (1994),
71 Ohio St.3d 318 ,320 ,643 N.E.2d 1088 , citing Simon v. E. Kentucky Welfare Rights Org. (1976),426 U.S. 26 ,40 ,96 S.Ct. 1917 ,48 L.Ed.2d 450 . Thus, "[t]he association must allege that its members, or any one of them, are suffering immediate or threatened injury as a result of the challenged action of the sort that would make out a justiciable case had the members themselves brought suit." Warth v. Seldin (1975),422 U.S. 490 ,511 ,95 S.Ct. 2197 ,45 L.Ed.2d 343 , citing Sierra Club v. Morton (1972),405 U.S. 727 ,734-741 ,92 S.Ct. 1361 ,31 L.Ed.2d 636 .
{¶ 15} The trial court, in addressing appellants' challenge to the standing of OLBA, held in its decision as follows:
*Page 7* * * If a permanent injunction is not granted, Plaintiff's members, who include bars that are subject to the same law as private clubs, will be treated differently under the law. Private clubs will be able to circumvent the SmokeFree Act while Plaintiff's members will not. This is an injury to Plaintiff's members' property rights and their basic ability to compete on a level playing field as dictated by law. Regardless of how much Rule 3701-52-4(G), as it is currently written, is subject to actual abuse, Plaintiff's members will suffer injury. Furthermore, as general members of the public, Plaintiff's members have an interest in seeing that the SmokeFree Act is properly administered and is properly used as it was intended, i.e. to protect employees from the harmful effects of cigarette smoke in the workplace. It is the opinion of the Court that Plaintiff and its members possess ample grounds for standing in the present matter.
{¶ 16} Regarding the second prong of the standing test noted inThompson, supra, we have little difficulty finding that the interests OLBA seeks to protect are germane to the association's purpose. In support of their standing argument, OLBA submitted the affidavit of Jacob Evans, the governmental affairs director of OLBA. Evans averred that OLBA is an Ohio trade association with approximately 500 members, including bar and restaurant owners, who hold a variety of different liquor permits. He further averred that the purpose of OLBA is to protect and advance the interests of retail liquor permit holders in Ohio. In its petition for injunctive relief, the trade association challenged ODH's promulgation of Ohio Adm. Code 3701-52-4(G) on the premise that it created an exemption, not included in the statute, that provided an unfair business advantage to private clubs over retail liquor permit holders.
{¶ 17} As to the third prong of the standing test, there is no apparent reason why the claims or relief asserted requires participation of individual members. The remaining issue, therefore, is whether OLBA's members would otherwise have standing to sue in their own right, i.e., whether the trade association has demonstrated its members have suffered immediate or threatened injury as a result of the challenged action.Thompson, supra, at ¶ 57.
{¶ 18} As noted, the trial court found that OLBA had standing based upon injury to its members' property rights and the ability of members to compete with other establishments holding liquor permits as a result of the regulation promulgated by ODH. In addition to the affidavit of Evans, the record also contains affidavits submitted by individual members of OLBA, including Matt D. Coffland, the owner and operator of the "Tiger Pub," located in Shady Side, Ohio. *Page 8
{¶ 19} According to Coffland, approximately 75 percent of his clientele is comprised of individuals who smoke, and on the first day of the smoking ban many of his customers left his establishment when informed they were unable to smoke. Coffland averred that many of his customers will stop frequenting his establishment "altogether if there is an alternative place where they can smoke and drink at the same time," and that these customers "will not return * * * if given an alternative place such as a private club with employees where they can drink and smoke for a sustained period of time." (Coffland Affidavit, at ¶ 17.) He further averred that "[t]his loss of customer loyalty and goodwill will be irreparable to me," and he believed, based upon his experience in the community, that at least two of Shady Side's four bars will have to close as a result of the loss of business if private clubs, with employees who are also members, are allowed to permit smoking in their establishment. Id.
{¶ 20} Michael Beans, the owner of a sports bar, averred in an affidavit he had suffered a loss of customers (approximately 33 percent) since the SmokeFree Act went into effect, and that the decline in his clientele had been made worse by the fact that private clubs in the area had continued to allow smoking. According to Beans, he will not be able to continue in business "with a 33% drop off in my business as a result of customers leaving my establishment for the private clubs with employees across the street, where they can smoke." (Beans Affidavit, at ¶ 17.)
{¶ 21} Upon review, we find in the instant case that the trade association sufficiently alleged facts that at least one of its members is suffering immediate or threatened injury as a result of the challenged action. Courts have recognized standing to sue based upon a trade association's claim of economic injury to its members from unfair *Page 9
competition resulting from an alleged invalid action by an agency. SeeNatl. Tank Truck Carriers v. Lewis (D.C. Cir.1982),
{¶ 22} Finally, we note that the record indicates OLBA participated to some degree in the rule-making process in this matter. Specifically, Evans averred that OLBA has "taken an active interest in the smoking ban issue in Ohio, and has been directly involved in several legislative, ballot, and litigation issues connected to the smoking ban issue, expending considerable time and resources in the process." (Evans Affidavit, at ¶ 7.) Evans served as the OLBA's representative on the advisory committee convened by ODH to discuss the smoking ban and the proposed rules. ODH itself, in its May 9, 2007 memorandum in opposition to OLBA's motion for preliminary injunction, noted that this advisory committee was "comprised of businesses and trade associations, health *Page 10 organizations, and health officials to provide input for ODH to draft rules for implementing R.C. Chapter 3794."
{¶ 23} Here, we conclude that OLBA presented sufficient evidence that a justiciable controversy exists, and that its members would otherwise have standing to sue in their own right. Accordingly, we find that the trial court did not err in finding on this record that standing requirements to bring a declaratory judgment were satisfied.
{¶ 24} Based upon the foregoing, appellants' second assignment of error is without merit and is overruled.
{¶ 25} We next consider appellants' first assignment of error, in which it is asserted the trial court erred in holding that the SmokeFree Act does not include a private club exemption. Appellants argue that the trial court erred in finding clear and unambiguous the definition of "employee," under R.C.
{¶ 26} The Ohio Supreme Court has observed that "[t]he purpose of administrative rulemaking is to facilitate an administrative agency's placing into effect the public policy embodied in legislation to be administered by the agency." Amoco Oil Co. v. Petroleum UndergroundStorage Tank Release Comp. Bd. (2000),
{¶ 27} We begin by noting the relevant portions of the SmokeFree Act. The general purpose of the Act is set forth in R.C.
Because medical studies have conclusively shown that exposure to secondhand smoke from tobacco causes illness and disease, including lung cancer, heart disease, and respiratory illness, smoking in the workplace is a statewide concern and, therefore, it is in the best interests of public health that smoking of tobacco products be prohibited in public places and places of employment and that there be a uniform statewide minimum standard to protect workers and the public from the health hazards associated with exposure to secondhand smoke from tobacco.
The provisions of this chapter shall be liberally construed so as to further its purposes of protecting public health and the health of employees and shall prevail over any less restrictive state or local laws or regulations. Nothing in this chapter shall be construed to permit smoking where it is otherwise restricted by other laws or regulations.
{¶ 28} R.C.
No proprietor1 of a public place or place of employment, except as permitted in section
3794.03 of this chapter, shall permit smoking in the public place or place of employment or in the areas directly or indirectly under the control of the *Page 12 proprietor immediately adjacent to locations of ingress or egress to the public place or place of employment.
{¶ 29} R.C.
{¶ 30} The exemption for "private clubs," R.C.
The following shall be exempt from the provisions of this chapter:(G) Private clubs as defined in section
4301.01 (B)(13) of the Revised Code, provided all of the following apply: the club has no employees; the club is organized as a not for profit entity; only members of the club are present in the club's building; no persons under the age of eighteen are present in the club's building; the club is located in a freestanding structure occupied solely by the club; smoke from the club does not migrate into an enclosed area where smoking is prohibited under the provisions of this chapter; and, if the club serves alcohol, it holds a valid D4 liquor permit.
{¶ 31} Ohio Adm. Code
Private clubs shall be exempt from the provisions of Chapter 3794. of the Revised Code and Chapter 3701-52 of the Administrative Code provided all of the following apply: the club has no employees; the club is organized as a not for profit entity; only members of the club are present in the club's building; no persons under the age of eighteen are present in the club's building; the club is located in a freestanding structure occupied solely by the club; smoke from the club does not migrate into an enclosed area where smoking is prohibited under the provisions of this chapter; and, if the club serves alcohol, it holds a valid D4 liquor permit. For purposes of this exemption, the term employees does not include *Page 13 members of the private club who provide services to the private club. (Emphasis added.)
{¶ 32} The SmokeFree Act sets forth definitions of "employer," "employee" and "place of employment." R.C.
"Place of employment" means an enclosed area under the direct or indirect control of an employer that the employer's employees use for work or any other purpose, including but not limited to, offices, meeting rooms, sales, production and storage areas, restrooms, stairways, hallways, warehouses, garages, and vehicles. An enclosed area as described herein is a place of employment without regard to the time of day or the presence of employees.
{¶ 33} R.C.
{¶ 34} In the present case, the trial court found that ODH exceeded its rule-making authority by promulgating the last sentence set forth in Ohio Adm. Code
* * * The "private club" exemption found in R.C.3794.03 (G) does not state that members of a private club are exempt from the definition of "employee." R.C.3794.01 (D), defining "employee," does not exclude members of private clubs from its definition. Therefore, the disputed language found in Rule 3701-52-04(G) exempting private club members from the definition of "employee" is in addition to the language passed in the SmokeFree Act and is invalid on its face. This is a *Page 14 simple case of looking at the plain language of R.C.3794.03 (G) and R.C.3794.01 (D), and seeing that Rule 3701-52-04(G) improperly adds to it. Defendant, the Ohio Department of Health, exceeded its authority in drafting the disputed language found in Rule 3701-52-04(G). * * *
{¶ 35} We agree with the trial court that ODH, in promulgating a rule excluding members of private clubs (who provide services to the club) from the definition of "employee," impermissibly added to the scope of the exemption for private clubs under the Act. Appellants' assertion that the trial court erred in holding the provisions of R.C.
{¶ 36} We note that appellants express apparent agreement with a portion of the trial court's decision suggesting that the statute, as enacted, contains an exemption in name only. Appellants argue that ODH, in an effort to reconcile a statutory conflict that essentially rendered the private club exemption a nullity, gave meaning to the private club exemption through promulgation of Ohio Adm. Code
{¶ 37} In response, OLBA argues that appellants' conflict argument fails to give recognition to the language of R.C.
{¶ 38} OLBA's focus on the issue of control raises common law employer-employee/master-servant concepts. OLBA's reliance upon such principles arguably has some support by the language utilized in R.C.
{¶ 39} However, even assuming a conflict between statutory provisions in the Act, an agency may not, in response, enact a rule that is in conflict with a statute. Columbus Southern Ohio Elec. Co. v. Indus.Comm. (1992),
{¶ 40} ODH maintains that it created a rule that permits club membership to take precedence over the statutory definition of "employee," and that in doing so it protected *Page 17
the spirit and purpose of the SmokeFree Act. However, in defining "employee" in the manner it did, ODH created a rule that not only conflicts with the enabling statute, creating an exemption that did not exist, but that is also at odds with the broadly stated purpose of the SmokeFree Act, i.e., that it is in the best interest of public health that smoking be prohibited in public places and "places of employment." R.C.
{¶ 41} We recognize the difficulties presented to an agency charged with the task of promulgating rules in response to petition initiatives such as the SmokeFree Act, and in seeking to harmonize the various provisions therein. ODH's efforts in this case, however, went beyond health-related concerns and reached legislative functions involving the balancing of social and economic concerns. Assuming that the SmokeFree Act falls short of providing the exemption contemplated by the agency or other groups, any potential change to the exemption as enacted would be a matter for the legislature, not the administrative agency, to address.
{¶ 42} Upon review, we agree with the trial court that ODH exceeded its authority in enacting the last sentence of Ohio Adm. Code
{¶ 43} In light of our disposition of appellants' assignments of error, OLBA's conditional cross-assignment of error and its two cross-assignments of error are hereby rendered moot.
{¶ 44} Based upon the foregoing, appellants' first and second assignments of error are overruled, OLBA's conditional cross-assignment of error and its two cross-assignments of error are moot, and the judgment of the Franklin County Court of Common Pleas is hereby affirmed.
Judgment affirmed.
McGRATH and TYACK, JJ., concur.