Schneider v. Cuyahoga Cty. Bd. of Commrs. , 2017 Ohio 1278 ( 2017 )

[Cite as Schneider v. Cuyahoga Cty. Bd. of Commrs., 2017-Ohio-1278.]
Court of Appeals of Ohio
EIGHTH APPELLATE DISTRICT
COUNTY OF CUYAHOGA
JOURNAL ENTRY AND OPINION
No. 103647
WILLIAM D. SCHNEIDER, ET AL.
PLAINTIFFS-APPELLANTS
vs.
CUYAHOGA COUNTY BOARD OF COUNTY
COMMISSIONERS, ET AL.
DEFENDANTS-APPELLEES
JUDGMENT:
AFFIRMED
Civil Appeal from the
Cuyahoga County Court of Common Pleas
Case No. CV-10-717610
BEFORE: E.T. Gallagher, J., Kilbane, P.J., and Blackmon, J.
RELEASED AND JOURNALIZED: April 6, 2017
ATTORNEY FOR APPELLANTS
Avery S. Friedman
Avery S. Friedman & Associates
701 The City Club Building
850 Euclid Avenue
Cleveland, Ohio 44114
ATTORNEYS FOR APPELLEES
Michael C. O’Malley
Cuyahoga County Prosecutor
BY: Dale F. Pelsozy
Jennifer Meyer
Assistant Prosecuting Attorney
The Justice Center, 8th Floor
1200 Ontario Street
Cleveland, Ohio 44113
EILEEN T. GALLAGHER, J.:
{¶1} Plaintiffs-appellants, William D. Schneider, et al. (collectively “appellants”),
appeal from the judgment of the Cuyahoga County Court of Common Pleas granting
summary judgment in favor of defendants-appellees, the Cuyahoga County Board of
County Commissioners, et al. 1 (“collectively the “BOCC”). Appellants raise the
following assignments of error for our review:
1. The exhaustion of administrative remedies by the plaintiffs became a
futile act in that the decision-makers were participants in the reversal of
granting early retirement benefits to all county workers except the plaintiffs
who were originally granted benefits by the defendants.
2. The trial court committed reversible error in granting summary
judgment to defendant-appellees when evidence established a multitude of
genuine issues of material fact.
3. The trial court committed reversible error in granting summary
judgment by apparently disregarding the fact that defendants-appellees
reversed themselves by first granting ERIP benefits, then denying ERIP
benefits. The reversal establishes an issue of material fact.
4. The trial court committed reversible error in granting summary
judgment by apparently disregarding the fact of historical grants of senior
SED employee participation in ERIP benefits prior to their complaining
about corruption by county officials.
We note that the BOCC has since been replaced by the Cuyahoga County Council. At
1
oral arguments, the parties were notified that a current member of the Council is related to a panel
judge. The panel judge disclosed, pursuant to Ohio Code of Judicial Conduct Rule 2.11(C), her
relationship with the Council member and stated that she could perform an independent, fair, and
impartial review of the legal issues presented in this case. Counsel for appellants and the BOCC each
indicated that they waived disqualification and had no objection to the panel member’s participation in
the proceeding.
5. The trial court committed reversible error in granting summary judgment by relying
on an affidavit of the attorney for defendants-appellees in determining that no genuine
issues of material fact existed even though plaintiffs-appellants submitted evidence to the
contrary.
6. The trial court committed reversible error in granting summary judgment by
apparently relying on an excerpt of a different proceeding which included the partial
testimony of an OPERS employee unrelated to the factual information and controversy
involved in this case.
{¶2} After careful review of the record and relevant case law, we affirm the trial
court’s judgment.
I. Procedural History
{¶3} On November 6, 2008, the BOCC passed a resolution establishing a
county-wide Early Retirement Incentive Program (“ERIP”) in an effort to combat
budgetary concerns. As written, the ERIP excluded only one county agency, the Sanitary
Engineering Division (“SED”). The SED is a subdivision of the BOCC, created and
maintained by the BOCC as an operating division of the County Engineer’s Office. But
the BOCC created a separate employing unit called the “BOCC, excluding the SED”
specifically for the ERIP.
{¶4} Pursuant to the ERIP’s grievance procedure, SED employees, including
appellants, filed a grievance on behalf of all SED employees regarding the BOCC’s
decision to exclude them from participation in the ERIP. SED employees suggested that
the BOCC’s decision to “revoke” SED’s participation in the ERIP was made in retaliation
to certain complaints raised by SED employees about workplace conditions. On January
9, 2009, the county administrator held a hearing on the grievance. Approximately 15
SED employees attended the hearing and were given an opportunity to be heard. On
January 20, 2009, the county administrator issued a decision denying the grievance
request and concluding that the SED would not be allowed to participate in the ERIP. In
a letter to plaintiffs, the administrator explained that Cuyahoga County “is facing a very
critical financial situation” and “an ERIP in the Sanitary Engineer agency would not have
been a cost savings.” Following the administrator’s decision, none of the SED
employees attempted to file an administrative appeal pursuant to R.C. 2506.01.
{¶5} On December 30, 2009, Teamsters Local Union No. 436 and union member
Kevin Lesh (collectively “the union”), filed a taxpayer action against the BOCC, on
behalf of all union-member SED employees, seeking injunctive and declaratory relief.
Specifically, the union sought a declaration that the commissioners violated R.C. 145.297
when they authorized the ERIP for all board employees excluding the SED. In addition,
the union sought an order compelling the BOCC to include the SED in the ERIP. The
union sought similar relief in a separate cause of action for declaratory judgment and in
a request for a writ of mandamus in its January 7, 2010 amended complaint. In addition
to denying the merits of the union’s claims, the BOCC asserted that the union did not
have standing to bring its taxpayer action and that it was otherwise barred from requesting
equitable remedies because the SED employees had failed to exhaust their administrative
remedies.
{¶6} Noting that the union had brought the present action mere days before the
ERIP was due to terminate, the trial court denied the union’s request for injunctive relief
and its action in mandamus, in an entry issued on January 22, 2010. However, the trial
court granted the union’s prayer for declaratory relief and held that the BOCC’s failure to
include the SED as part of the “employing unit” that was eligible for the ERIP did not
comply with the definition of “employing unit” in R.C. 145.297 and that the
commissioners were therefore in violation of the statute.
{¶7} The commissioners appealed to the this court, which, in a split decision,
affirmed the trial court’s judgment, finding (1) the union had standing to bring the
taxpayer action, (2) the BOCC failed to comply with R.C. 145.297 when it designated
“Cuyahoga County, excluding Sanitary Engineering” as the subordinate employing unit,
and (3) the union was “not required to exhaust administrative remedies because the [SED
employees] were excluded from participating in the ERIP; thus, any attempt to go through
an administrative remedy process would have been futile.” State ex rel. Teamsters Local
Union No. 436 v. Cuyahoga Cty. Bd. of Commrs., 194 Ohio App.3d 258, 2011-Ohio-820,
955 N.E.2d 1020 (8th Dist.) (“Teamsters I”).
{¶8} Subsequently, the Ohio Supreme Court accepted discretionary jurisdiction to
hear the BOCC’s appeal. State ex rel. Teamsters Local Union No. 436 v. Bd. of County
Commrs, 132 Ohio St.3d 47, 2012-Ohio-1861, 969 N.E.2d 244 (“Teamsters II”). On
May 1, 2012, the Ohio Supreme Court reversed this court’s decision, finding (1) the union
lacked standing to bring a taxpayer action because it sought a remedy solely for its own
benefit, and (2) “the union and the [SED] employees” failed to exhaust their
administrative remedies by taking no further action after the county administrator denied
the grievance. Id. at ¶ 17-24.
{¶9} During the pendency of Teamster I, appellants, a group of sanitary engineers
led by plaintiff William Schneider, filed the instant case in their personal capacities on
February 5, 2010. Appellants’ complaint sought equitable relief, monetary damages, and
a declaration that the BOCC violated R.C. 145.297 when it excluded the SED from the
group of employees permitted to participate in the ERIP. The BOCC sought dismissal of
the complaint because, as in Teamsters II, appellants failed to exhaust their administrative
remedies. The trial court stayed the matter pending the resolution of Teamsters I and II.
Upon issuance of Teamsters II, the trial court dismissed appellants’ complaint pursuant to
Civ.R. 12(B)(6). Appellants timely appealed the trial court’s judgment.
{¶10} On May 9, 2013, this court reversed the trial court’s judgment, finding that a
Civ.R. 12(B)(6) dismissal on grounds that appellants failed to exhaust their administrative
remedies was “premature” because it required the trial court to go beyond the four corners
of the complaint. Schneider v. Cuyahoga County Bd. of County Commrs, 8th Dist.
Cuyahoga No. 98936, 2013-Ohio-1900, ¶ 12. This court explained:
Although [the language of Teamsters II] suggests that the Supreme Court
thought it unlikely that both the union members and the other employees
would be able to prove that an administrative appeal would have been a
vain act, the fact remains that they were not offered the opportunity to do
so.
Id. at ¶ 12.
{¶11} On remand, the BOCC filed a motion for summary judgment, arguing it was
entitled to judgment as a matter of law pursuant to the Ohio Supreme Court’s decision in
Teamsters II. In July 2014, appellants filed a motion in opposition, arguing that
Teamsters II did not resolve the remaining issues of material fact concerning the BOCC’s
pretextual basis for excluding the SED from participation in the ERIP. In August 2014,
the trial court granted summary judgment in favor of the BOCC.
{¶12} Appellants appealed the trial court’s judgment on September 19, 2014. On
May 12, 2015, this court dismissed the appeal for lack of a final, appealable order
pursuant to R.C. 2505.02, stating:
The complaint in its first demand for judgment seeks declaratory relief, but the judgment
entry merely recites the formula for summary judgment and grants judgment for the
defendants without making a declaration. Klocker v. Zeiger, 8th Dist. Cuyahoga No.
92044, 2009-Ohio-3102.
{¶13} On remand, the trial court granted the BOCC’s motion for summary
judgment for a second time, stating:
Pursuant to the remand by the Eighth District Court of Appeals, this Court’s grant of
defendants’ motion for summary judgment stands as plaintiffs failed to exhaust their
administrative remedies. As plaintiffs’ continued participation in the grievance process
would not have been a vain act, plaintiffs may not pursue a declaratory judgment action
without exhausting the available administrative remedies. See State ex rel. Teamsters
Local Union No. 436 v. Bd. of County Commrs, 132 Ohio St.3d 47, 2012-Ohio-1861, 969
N.E.2d 244. This order is final and appealable.
{¶14} Appellants now appeal from the trial court’s judgment.
II. Law and Analysis
{¶15} Within their six assignments of error, appellants’ collectively argue the trial
court committed reversible error in granting summary judgment in favor of the BOCC.
A. Standard of Review
{¶16} An appellate court reviews a trial court’s decision to grant summary
judgment de novo. Grafton v. Ohio Edison Co., 77 Ohio St.3d 102, 105, 671 N.E.2d 241(1996). De novo review means that this court “uses the same standard that the trial court
should have used, and we examine the evidence to determine if as a matter of law no
genuine issues exist for trial.” Brewer v. Cleveland Bd. of Edn., 122 Ohio App.3d 378,
383, 701 N.E.2d 1023 (8th Dist.1997), citing Dupler v. Mansfield Journal, 64 Ohio St.2d
116, 119-120, 413 N.E.2d 1187 (1980). In other words, we review the trial court’s
decision without according the trial court any deference. Brown v. Scioto Cty. Bd. of
Commrs., 87 Ohio App.3d 704, 711, 622 N.E.2d 1153 (4th Dist.1993).
{¶17} Under Civ.R. 56(C), summary judgment is properly granted when (1) there
is no genuine issue as to any material fact; (2) the moving party is entitled to judgment as
a matter of law; and (3) reasonable minds can come to but one conclusion, and that
conclusion is adverse to the party against whom the motion for summary judgment is
made. Harless v. Willis Day Warehousing Co., 54 Ohio St.2d 64, 66, 375 N.E.2d 46(1976). If the moving party fails to satisfy its initial burden, “the motion for summary
judgment must be denied.” Dresher v. Burt, 75 Ohio St.3d 280, 293, 662 N.E.2d 264(1996). But if the moving party satisfies “its initial burden, the nonmoving party then
has a reciprocal burden outlined in Civ.R. 56(E) to set forth specific facts showing that
there is a genuine issue for trial and, if the nonmovant does not so respond, summary
judgment, if appropriate, shall be entered against the nonmoving party.” Id.B. Exhaustion of Administrative Remedies
{¶18} Initially, appellants argue the trial court erred in concluding that their
continued participation in the grievance process would not have been a vain or futile act.
Appellants contend that an administrative appeal would have been futile because “the
administrative remedy involved the very county officials that [excluded the SED from the
ERIP] once plaintiffs-appellants complained of the political cronyism” in Cuyahoga
County. Appellants’ position relies extensively on allegations raised throughout their
appellate brief that the BOCC’s decision to revoke the SED’s participation in the ERIP
was made “in retaliation to [SED employees’] complaints about workplace conditions”
and “corruption by county officials.”
{¶19} After careful review, we find a similar futility argument was originally
raised by the plaintiffs in Teamsters I. At that time, this court agreed with the argument
currently raised by appellants, stating:
In this case, we find that the [union was] not required to exhaust
administrative remedies because the [union was] excluded from
participating in the ERIP; thus, any attempt to go through an administrative
remedy process would have been futile.
Teamsters I, 194 Ohio App.3d 258, 2011-Ohio-820, 955 N.E.2d 1020, at ¶ 32.
{¶20} However, in Teamsters II, the Ohio Supreme Court reversed this court’s
decision regarding the exhaustion of administrative remedies, finding:
Because we hold that the union did not have standing to pursue its
taxpayer action, the issue of exhaustion of administrative remedies is moot
as to the taxpayer action. However, to the extent that the union’s complaint
sought relief that was separate from the taxpayer cause of action, we
examine whether the union and the Sanitary Engineering Division
employees were required to exhaust administrative remedies prior to
initiating a declaratory-judgment action.
It is a “long-settled rule of judicial administration that no one is entitled to judicial
relief for a supposed or threatened injury until the prescribed administrative remedy has
been exhausted.” Myers v. Bethlehem Shipbuilding Corp., 303 U.S. 41, 50-51, 58 S.Ct.
459, 82 L.Ed. 638 (1938). Thus, a “party must exhaust the available avenues of
administrative relief through administrative appeal” before seeking separate judicial
intervention. Noernberg v. Brook Park, 63 Ohio St.2d 26, 29, 406 N.E.2d 1095 (1980).
“Exhaustion is generally required as a matter of preventing premature interference with
agency processes, so that the agency may function efficiently and so that it may have an
opportunity to correct its own errors, to afford the parties and the courts the benefit of its
experience and expertise, and to compile a record which is adequate for judicial review.”
Weinberger v. Salfi, 422 U.S. 749, 765, 95 S.Ct. 2457, 45 L.Ed.2d 522 (1975). Where a
party fails to exhaust available administrative remedies, allowing declaratory relief would
serve “only to circumvent an adverse decision of an administrative agency and to bypass
the legislative scheme.” Fairview Gen. Hosp. v. Fletcher, 63 Ohio St.3d 146, 152, 586
N.E.2d 80 (1992).
We first look to what administrative remedies were available to the
union-represented Sanitary Engineering Division employees. When a board of county
commissioners adopts regulations that allow parties to request review from an
administrative authority, the decision of that authority constitutes a final order that is
appealable, under R.C. 2506.01, to an applicable court of common pleas. R.C. 307.56.
Pursuant to R.C. 145.297(B), “[e]very retirement incentive plan shall include provisions
for the timely and impartial resolution of grievances and disputes arising under the plan.”
The ERIP in question complied with the above statutory requirements by
providing: “Any employee determined to be ineligible to participate in this early
retirement incentive plan may file a grievance * * *. Such grievances shall be heard
and decided by the Cuyahoga County Administrator * * *. The decision of the
Cuyahoga County Administrator shall be final.” Although the ERIP was made available
only to employees in an “Employing Unit” defined to exclude the Sanitary Engineering
Division, the ERIP did not define “Employee” to exclude any division’s employees, and
thus the grievance process was made available to all employees under the board’s
supervision. Accordingly, the Sanitary Engineering Division employees were required
to file a grievance with the administrator and to file an R.C. 2506.01 administrative
appeal from the administrator’s decision, in order to exhaust their administrative
remedies.
Although none of the union-represented employees was named in the grievance
that was filed on behalf of all of the Sanitary Engineering Division employees, some of
the union-represented employees availed themselves of the grievance process by
participating in the hearing with the administrator. After the administrator issued a final
order denying the grievance, none of the Sanitary Engineering Division employees filed
an administrative appeal. Accordingly, the employees failed to exhaust all of their
administrative remedies.
It is well settled that “[a] person entitled under R.C. Chapter 2506 to appeal [an
administrative order] is not entitled to a declaratory judgment where failure to exhaust
administrative remedies is asserted and maintained.” Schomaeker v. First Natl. Bank of
Ottawa, 66 Ohio St.2d 304, 421 N.E.2d 530 (1981), paragraph three of the syllabus.
Under this general rule, the union was not entitled to pursue its action for declaratory
judgment, because it filed the action almost one year after the final order of the
administrator without first attempting a timely R.C. 2506.01 appeal from the order.
However, in line with the Eighth District’s holding below, the union asserts that an
exception to the general rule applies and that the Sanitary Engineering Division
employees were not required to exhaust their administrative remedies, because continuing
to participate in the grievance process would have been futile.
It is true that parties need not pursue their administrative remedies if doing so
would be futile or a vain act. Driscoll v. Austintown Assocs., 42 Ohio St.2d 263, 275, 328
N.E.2d 395 (1975). However,
a “vain act” occurs when an administrative body lacks the authority to grant the relief
sought; a vain act does not entail the petitioner’s probability of receiving the remedy. The
focus is on the power of the administrative body to afford the requested relief, and not on
the happenstance of the relief being granted.
(Emphasis sic.) Nemazee v. Mt. Sinai Med. Ctr., 56 Ohio St.3d 109, 115, 564 N.E.2d
477 (1990). Neither the decision below nor the appellees explain why it would have
been impossible to obtain relief through an administrative appeal, apart from merely
stating that the Sanitary Engineering Division employees were excluded from
participating in the ERIP. As noted above, the board’s ERIP made the grievance process
available to the employees, and union-represented employees were given an opportunity
to be heard during the grievance hearing. Nothing would have prevented the union from
attacking the validity of the ERIP in an administrative appeal. Therefore, we hold that the
Sanitary Engineering Division employees’ continued participation in the grievance
process would not have been a vain act, and we reverse the Eighth District’s decision
allowing the union to pursue the declaratory-judgment action without exhausting the
available administrative remedies.
Teamsters II, 132 Ohio St.3d 47, 2012-Ohio-1861, 969 N.E.2d 244, at ¶ 18-24.
{¶21} In this case, the non-union employees who filed and signed the grievance
referred to in Teamsters II are the appellants in this appeal. As the Ohio Supreme Court
stated in its opinion, no SED employee, whether union or non-union, sought further
review after receiving an adverse decision on their grievance. In our view, this fact is
dispositive.
{¶22} While we recognize that the non-union members of the SED were not
parties in the Teamsters case, the Ohio Supreme Court’s holding applies equally to all
employees of the SED. In short, the original grievance was filed and argued on behalf
of all SED employees, including appellants, and those SED employees failed to exhaust
their administrative remedies by not filing an administrative appeal pursuant to R.C.
2506.01 after the grievance was denied. Moreover, analogous to the holding in
Teamsters II, beyond appellants’ contention that their appeal was unlikely to be
successful, there is nothing in the record to suggest appellants “would have [been]
prevented * * * from attacking the validity of the ERIP in an administrative appeal.”
See Teamsters II at ¶ 24. As stated, arguments concerning the probability of success on
appeal is not an appropriate basis for a finding of futility. Id.{¶23} In addition, we find no merit to appellants’ contention that the available
administrative remedy in this case “involved the very county officials that [excluded the
SED from the ERIP] when they learned plaintiffs-appellants complained of the political
cronyism” in Cuyahoga County. As articulated in Teamsters II, the decision of the
county administrator constituted a final order that was appealable, under R.C. 2506.01, to
the applicable court of common pleas. Thus, appellants “continued participation in the
grievance process” would have involved an appeal to the fair and impartial Cuyahoga
County Court of Common Pleas.
{¶24} Based on the foregoing, we find appellants have not presented issues of
material fact concerning whether their continued participation in the grievance process
would have been a vain or futile act. Despite this court’s position regarding the
exhaustion of administrative remedies, as reflected in this court’s holding in Teamsters I,
194 Ohio App.3d 258, 2011-Ohio-820, 955 N.E.2d 1020 (8th Dist.), at ¶ 32, we are
bound to follow the precedent of the Ohio Supreme Court. Accordingly, the trial court
did not err in granting summary judgment in favor of the BOCC. See Schomaeker, 66
Ohio St. 2d 304, 421 N.E.2d 530, at paragraph three of the syllabus (It is well settled that
“[a] person entitled under R.C. Chapter 2506 to appeal [an administrative order] is not
entitled to a declaratory judgment where failure to exhaust administrative remedies is
asserted and maintained.”).
{¶25} Appellants’ first assignment of error is overruled. Based on our resolution
of appellant’s first assignment of error, the remaining assignments of error are moot.
See App.R. 12(A)(1)(c).
{¶26} Judgment affirmed.
It is ordered that appellee recover from appellant costs herein taxed.
The court finds there were reasonable grounds for this appeal.
It is ordered that a special mandate be sent to 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.
EILEEN T. GALLAGHER, JUDGE
PATRICIA ANN BLACKMON, J., CONCURS;
MARY EILEEN KILBANE, P.J., CONCURS (WITH SEPARATE OPINION
ATTACHED)
MARY EILEEN KILBANE, P.J., CONCURRING WITH SEPARATE OPINION:
{¶27} I concur in the judgment, but I write separately to recapitulate this court’s
holding in Teamsters I. Appellants maintain that the ERIP was offered to them in
October 2008 and then later modified in November 2009 to solely exclude senior SED
employees. While we are bound to follow the precedent of the Ohio Supreme Court, I
would find that appellants had a viable cause of action had the appellants properly
exhausted their administrative remedies.