State v. Calhoun

[Cite as State v. Calhoun, 2021-Ohio-2101.]

COURT OF APPEALS OF OHIO

EIGHTH APPELLATE DISTRICT
COUNTY OF CUYAHOGA

CITY OF SHAKER HEIGHTS, OHIO, :

Plaintiff-Appellee, :
No. 109601
v. :

ERICA L. CALHOUN, ET AL., :

Defendants. :

[Appeal by Michael Davie,
Defendant-Appellant.] :

JOURNAL ENTRY AND OPINION

JUDGMENT: AFFIRMED
RELEASED AND JOURNALIZED: June 24, 2021

Civil Appeal from the Cuyahoga County Court of Common Pleas
Case No. CV-19-916606

Appearances:

Regional Income Tax Agency, Amber E. Greenleaf Duber, Amy
L. Arrighi, and Jeffrey P. Sherman, for appellee.

Michael Davie, pro se.

MICHELLE J. SHEEHAN, J.:

Appellant Michael Davie appeals the grant of summary judgment to

appellee city of Shaker Heights upon its complaint for taxes owed. Because the trial
court properly granted summary judgment, we affirm the grant of summary

judgment.

PROCEDURAL HISTORY AND FACTS

On April 10, 2018, the city of Shaker Heights (hereinafter “the city”)

filed a complaint against Erica Calhoun1 and Michael Davie for unpaid municipal

income tax for the years 2011 through 2016. The city voluntarily dismissed its

complaint on January 1, 2019. On June 11, 2019, the city refiled its complaint and

sought judgment in the amount of $5,144 plus associated penalties and interest.

The city alleged that no municipal income tax return was filed by Calhoun or Davie

for those years. Both the city and the defendants filed motions for summary

judgment.

In its motion for summary judgment, the city alleged that for the years

2011 through 2016, Davie resided in the city, that he earned wages subject to

taxation, and that he failed to file a return or remit the taxes due. The motion was

supported by an affidavit from a paralegal at the Regional Income Tax Agency,

federal tax returns, and Davie’s responses to requests for admissions. In his brief in

opposition to the city’s motion for summary judgment, Davie requested summary

judgment alleging that the city never exhausted its administrative remedies, gave

him any notice of tax assessments, and filed its suit outside a three-year statute of

limitations. He further contested the amount of tax sought for the years 2013 and

1 Erica Calhoun has not appealed the judgment.
2014 due to lawsuit settlements. The city filed a reply to the brief in opposition and

moved the trial court to strike Davie’s motion for summary judgment because it was

filed outside the court’s dispositive-motion deadline. The city further noted that it

did not use Davie’s lawsuit settlement to calculate tax due from Davie for the year

2014.

It was not disputed that Davie was a resident of the city and did not

file a municipal income tax return in the years 2011 through 2016. On January 3,

2020, the trial court denied Davie’s motion for summary judgment and granted the

city’s motion for summary judgment against him. In so doing, the trial court found

1) that the city was not required to pursue an administrative process before filing the

actions, 2) that R.C. 718.90(A) did not mandate that the tax commissioner make an

assessment, and 3) that the period of limitations had not run because Davie had not

filed a return for the years in question.

The trial court further found that there was an issue of fact regarding

the taxable income for 2013. On February 21, 2020, the city dismissed its claim for

taxes due for the year 2013. The trial court then entered a final judgment awarding

the city $3,800 against Calhoun and Davie for the tax years 2011, 2012, 2014, 2015,

and 2016 plus statutory interests, costs associated with the action, and post-

judgment collection costs and fees as provided in R.C. 718.27(G).

LAW AND ARGUMENT

Under Civ.R. 56, the grant of a motion for summary judgment is

appropriate where:
 (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,
who is entitled to have the evidence construed most strongly in his or
her favor.

Carter v. Officer Hymes, 8th Dist. Cuyahoga No. 108523, 2020-Ohio-3967, ¶ 20-

23, citing Harless v. Willis Day Warehousing Co., Inc., 54 Ohio St.2d 64, 66, 375

N.E.2d 46 (1978); Civ.R. 56(C).

Civ.R. 56(C) provides that summary judgment shall be rendered if “the

pleadings, depositions, answers to interrogatories, written admissions, affidavits,

transcripts of evidence, and written stipulations of fact, if any, timely filed in the

action, show that there is no genuine issue as to any material fact and that the

moving party is entitled to judgment as a matter of law.” A trial court’s grant of

summary judgment is reviewed de novo. Grafton v. Ohio Edison Co., 77 Ohio St. 3d

102, 105, 671 N.E.2d 241 (1996).

In his first assignment of error, Davie claims that “[t]he trial court

erred in granting Summary Judgment where Plaintiff failed to comply with Due

Process of law after it assessed Defendants with wage taxes.” He argues that the city

could not directly file an action for the collection of taxes, but instead must proceed

to collect taxes by way of an administrative procedure pursuant to R.C. 718.90.

Davie asserts that because there is an administrative procedure for the assessment

and collection of taxes, he has been deprived of due process of law because the

administrative notice requirements in R.C. 718.90 and Shaker Heights Codified
Ordinances 111.2503 were not met. Further, he asserts that because an

administrative system for income tax matters has been created, the city must resort

to that system prior to taking any other action to collect taxes, citing Nielsen v. Ford

Motor Co., 113 Ohio App.3d 495, 500, 681 N.E.2d 470 (9th Dist.1996). The city

argues that the trial court correctly denied Davie’s motion for summary judgment

but did so for the wrong reason. The city argues that R.C. 718.90 does not apply to

Davie.

By its own terms, R.C. 718.90(A) limits its provision to a “taxpayer

required to file a return under section 718.80 to 718.95 of the Revised Code”

R.C. 718.80 through 718.95 apply to taxpayers electing to file as net profit taxpayers,

and Davie did not allege that he made such election. Accordingly, his reliance on

R.C. 718.90 is misplaced because that revised code section and any notice provisions

therein do not apply to him.

As to the exhaustion doctrine, the Ohio Supreme Court has held that

an exhaustion of remedies is not required where there is a judicial remedy that is

intended to be separate and apart from the administrative process. Basic Distrib.

Corp. v. Ohio Dept. of Taxation, 94 Ohio St.3d 287, 290, 2002-Ohio-794, 762

N.E.2d 979. Davie failed to cite any prohibition in law that requires the city to

pursue an administrative remedy for the collection of taxes due. Because the city

was not prohibited from filing a lawsuit to collect taxes it believed due, Mr. Davie

was not denied any due process rights and Davie’s first assignment of error is

overruled.
 In his second assignment of error, Davie claims that “Plaintiff’s claims

were barred by a three (3) year statute of limitations and its application of

R.C. 718.12 and the City of Shaker Heights’ Ordinance 111.1701 to the facts presented

in the trial court were unconstitutional.” The city argues that because Davie never

filed a return, the applicable statute of limitations did not begin to run.

The applicable statute of limitations for the filing of actions to recover

taxes due is set forth in R.C. 718.12(A)(1)(a), which provides:

Civil actions to recover municipal income taxes and penalties and
interest on municipal income taxes shall be brought within the later
of:

(i) Three years after the tax was due or the return was filed, whichever
is later; or

(ii) One year after the conclusion of the qualifying deferral period, if
any.

(Emphasis added.)

Shaker Heights Codified Ordinances 111.1701 contains similar time

limitations on filing suit:

All taxes imposed by this chapter shall be collectible, together with any
interest and penalties thereon, by suit, as other debts of like amount
are recoverable. Except in the case of fraud, or omission of a
substantial portion of income subject to this tax, or of failure to file a
return, an additional assessment shall not be made after three (3)
years from the time the return was due or filed, whichever is later,
provided, however, in those cases in which the Commissioner of
Internal Revenue and the taxpayer have executed a waiver of the
Federal statute of limitations, the period within which an additional
assessment may be made by the Administrator shall be one (1) year
from the time of the final determination of the Federal tax liability.

(Emphasis added.)
 There is no dispute in the record that Davie did not file a municipal

income tax return for the years that the city sought to collect municipal income tax.

“Since no income tax return has yet been filed in the case at bar, any such filing will

naturally be later than the date the taxes were due, since the due date has already

passed. Therefore, the three-year statute has yet to begin running.” Springfield v.

Hicks, 48 Ohio App.3d 147, 148, 548 N.E.2d 972 (2d Dist.1988); see also Gibson v.

Levin, 119 Ohio St.3d 517, 2008-Ohio-4828, 895 N.E.2d 548, ¶ 10. In this case, the

statute of limitations did not begin to run and Davie’s second assignment of error is

overruled.

In his third assignment of error, Davie claims that “[t]he trial court

erred in sua sponte granting Summary Judgment where issues were not raised by

Plaintiff.” He claims that the trial court sua sponte determined that the city was not

required to proceed administratively before filing suit in a court of law. However, in

his motion for summary judgment, Davie argued that the city could not file suit

without first proceeding administratively. Thus, the court did not sua sponte

determine an issue in the case; rather, the trial court determined the issue raised by

him. As such, we overrule the third assignment of error.

In his fourth assignment of error, Davie claims, “The trial court abused

its discretion in failing to grant Defendants’ Protection Order request.” The city

argues that Davie has no standing to raise this argument where he did not make a

motion for protective order. The docket reflects that Calhoun filed a request for
protective order regarding personal identifying information attached to the city’s

motion for summary judgment. Davie did not file a similar request for a protective

order in this case.

We have found that an appellant may only complain of error

committed against a nonappealing party if the appellant can demonstrate that the

error is prejudicial to his or her rights. Prouse, Dash & Crouch, L.L.P. v. DiMarco,

8th Dist. Cuyahoga No. 96728, 2012-Ohio-12, ¶ 10, citing In re Hitchcock, 120 Ohio

App.3d 88, 99-100, 696 N.E.2d 1090 (8th Dist.1996), In re Hiatt, 86 Ohio App.3d

716, 721, 621 N.E.2d 1222 (4th Dist.1993). However, Davie has not asserted that the

trial court’s treatment of Calhoun’s request affected his rights nor has he asserted

how he was prejudiced by the trial court’s resolution of the request. Further, the

trial court’s determination of Calhoun’s motion had no effect on the issues raised in

the motions for summary judgment. Accordingly, the fourth assignment of error is

overruled.

CONCLUSION

The trial court properly granted summary judgment in this case where

there was no material fact in dispute and the record demonstrated that the city was

entitled to judgment as a matter of law. Because Davie had not filed a municipal

income tax return, the applicable statute of limitations had not begun to run and the

city was not prohibited from filing an action to recover municipal income taxes.

Judgment affirmed.

It is ordered that appellee recover of appellant 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

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.

_________________________________
MICHELLE J. SHEEHAN, PRESIDING JUDGE

MARY EILEEN KILBANE, J., and
LISA B. FORBES, J., CONCUR