Parkstone Capital Partners v. Solon

[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