KARVO COMPANIES, INC. v. OHIO DEPARTMENT OF TRANSPORTATION
C.A. No. 29294
IN THE COURT OF APPEALS NINTH JUDICIAL DISTRICT
Dated: November 6, 2019
2019-Ohio-4556
CALLAHAN, Presiding Judge.
APPEAL FROM JUDGMENT ENTERED IN THE COURT OF COMMON PLEAS COUNTY OF SUMMIT, OHIO CASE No. CV-2018-02-0664
CALLAHAN, Presiding Judge.
{1} Appellant, Ohio Department of Transportation, appeals from the order of the Summit County Common Pleas Court denying its motion to dismiss for lack of subject-matter jurisdiction. For the reasons set forth below, this Court affirms.
I.
{2} Karvo Companies, Inc. (“Karvo“) is a paving company located in Summit County with its primary source of business being highway construction contracts with the Ohio Department of Transportation (“ODOT“). In 2017, Karvo was in possession of a certificate of qualification, which permitted it to submit bids to ODOT for construction contracts.
{3} On September 22, 2017, ODOT issued a letter to Karvo notifying it that its certificate of qualification was revoked, that Karvo was subject to a proposed debarment, and that Karvo could request a hearing on these issues. A hearing was held, wherein the hearing officer concurred with ODOT‘s initial decision. Karvo filed objections. On February 5, 2018,
{4} Karvo filed an administrative appeal of the Director‘s Order in both Summit County and Franklin County. ODOT moved to dismiss the administrative appeal filed in Summit County for lack of subject-matter jurisdiction. The Summit County trial court denied the motion to dismiss and proceeded to reverse and remand the Director‘s February 5, 2018 Order on the merits. ODOT timely appeals the denial of the motion to dismiss.
II.
ASSIGNMENT OF ERROR
THE SUMMIT COUNTY COMMON PLEAS COURT ERRED IN CONSTRUING AND INTERPRETING
{5} ODOT contends that the trial court incorrectly interpreted the statutory definition of license and applied the wrong section of
{6} A motion to dismiss an administrative appeal for lack of subject-matter jurisdiction involves questions of law which this Court reviews de novo. Apostolic Faith Assembly, Inc. v. Coventry Twp., 9th Dist. Summit No. 23938, 2008-Ohio-2820, ¶ 3, 5, quoting Crosby-Edwards v. Ohio Bd. of Embalmers & Funeral Dirs., 175 Ohio App.3d 213, 2008-Ohio-762, ¶ 21 (10th Dist.). Similarly, a trial court‘s interpretation and application of a statute also presents questions of law and is reviewed de novo. In re Adoption of K.E.M., 9th Dist. Summit No. 26307, 2012-Ohio-5652, ¶ 11, quoting State v. Cruise, 185 Ohio App.3d 230, 2009-Ohio-6795, ¶ 5 (9th Dist.).
{7} Subject-matter jurisdiction is the statutory or constitutional power of a court to hear and decide the merits of a particular class of cases. Groveport Madison Loc. Schools Bd. of Edn. v. Franklin Cty. Bd. of Revision, 137 Ohio St.3d 266, 2013-Ohio-4627, ¶ 25, citing Pratts v. Hurley, 102 Ohio St.3d 81, 2004-Ohio-1980, ¶ 11; Bank of Am., N.A. v. Kuchta, 141 Ohio St.3d 75, 2014-Ohio-4275, ¶ 19. The Ohio Constitution provides a common pleas court with the authority to review proceedings of administrative officers and agencies as set forth in the law. Abt v. Ohio Expositions Comm., 110 Ohio App.3d 696, 699 (10th Dist.1996), quoting
Type of Adjudication
{8} In relevant part,
(A)(1) Except as provided in division (A)(2) or (3) of this section, any party adversely affected by any order of an agency issued pursuant to an adjudication denying an applicant admission to an examination, or denying the issuance or renewal of a license or registration of a licensee, or revoking or suspending a license, or allowing the payment of a forfeiture under section 4301.252 of the Revised Code may appeal from the order of the agency to the court of common pleas of the county in which the place of business of the licensee is located or the county in which the licensee is a resident.
* * *
(B) Any party adversely affected by any order of an agency issued pursuant to any other adjudication may appeal to the court of common pleas of Franklin [C]ounty, * * *.
{9} “ODOT is a department with licensing authority.” Asphalt Specialist, Inc. v. Ohio Dept. of Transp., 53 Ohio App.3d 45, 47 (10th Dist.1988). Only when ODOT performs a licensing function, such as “issuing, suspending, revoking, or canceling licenses[,]” is ODOT an
{10} Both ODOT and Karvo agree that the Director‘s Order is an adjudication as defined by
License
{11} The first question in determining the nature of the adjudication issued by the Director of ODOT is whether the certificate of qualification is a license as defined by
{12} The Director‘s Order concerns a certificate of qualification. ODOT concedes that
{13} As to ODOT‘s first argument, whether Karvo is able to do construction work on non-ODOT projects is irrelevant to whether ODOT‘s certificate of qualification is a license. A “certificate of qualification shall authorize its holder to bid on all work on which bids are taken by the department of transportation during the period of time therein specified.”
{14} As to ODOT‘s second argument, its attempt to equate the Supreme Court‘s use of the word “illegal” when defining license in Boesch with the requirement of a criminal penalty is misplaced. Boesch, 41 Ohio St.2d at 118, quoting Hipp, 38 Ohio St. 199 at paragraph two of the syllabus. ODOT discounts Karvo‘s reliance upon Total Office Prods. v. Dept. of Adm. Servs., 10th Dist. Franklin No. 05AP-955, 2006-Ohio-3313, by latching onto the Tenth District‘s statement that “[w]ithout [an MBE] certification, it would be illegal for a business to participate
{15} Total Office Products contained no reference to or analysis of the criminal penalty set forth in
{16}
{17} Based upon the foregoing, we conclude that ODOT‘s certificate of qualification is a license within the meaning of
Revocation and Debarment
{18} Having concluded that the certificate of qualification is a license, we must now examine whether the Director‘s Order revoking the certificate of qualification and debarring Karvo involves a licensing function.
{19} With respect to the revocation, ODOT‘s argument focused on the certificate of qualification not being a license. ODOT then separately argued that debarment only precludes the contractor from participating in future contracts with ODOT and thus is not a revocation, suspension, or denial. ODOT argues that revocation and debarment are two separate and independent adjudications. However, our review of
{20} For instance,
{21} Based upon the plain language cited above, revocation and debarment contemplates a single proceeding with a single adjudication that exists in tandem. While there may be a revocation of a certificate without debarment, there cannot be a debarment without a revocation. See
{22} Upon review of the language utilized in the Ohio Administrative Code and Ohio Revised Code, we conclude that a revocation and debarment order from the Director of ODOT regarding a certificate of qualification involves a licensing function under ODOT‘s licensing authority and is thereby a licensing adjudication. Accordingly, appeals from the director‘s order for revocation and debarment are to be filed in the common pleas court of the county in which the aggrieved party is a resident or has its place of business. See
{23} Karvo‘s business is located in Summit County. Therefore, the trial court did not err in determining that Summit County has subject-matter jurisdiction over this administrative appeal.
ODOT‘s Alternative Argument
{24} In the event we conclude that this matter involves a license adjudication subject to the home county rule in
{25} Relying upon Hughes v. Ohio Dept. of Commerce, 114 Ohio St.3d 47, 2007-Ohio-2877, ODOT asserts that “[f]or an adjudication order to be final and appealable under
{26} Hughes held that the 15-day appeal period set forth in
{27} Further, Hughes did not state that the common pleas court lacked subject-matter jurisdiction because the agency‘s adjudication order was not
{28} In this matter, ODOT fails to appreciate the distinction between subject-matter jurisdiction and “‘the third category of jurisdiction [i.e., jurisdiction over the particular case] * * *‘” (Alterations sic.) Pratts, 102 Ohio St.3d 81, 2004-Ohio-1980, at ¶ 12, quoting State v. Parker, 95 Ohio St.3d 524, 2002-Ohio-2833, ¶ 22 (Cook, J., dissenting), quoting State v. Swiger, 125 Ohio App.3d 456, 462 (9th Dist.1998). The Ohio Supreme Court has consistently recognized that “[t]here is a distinction between a court that lacks subject-matter jurisdiction over a case and a court that improperly exercises that subject-matter jurisdiction once conferred
{29} As discussed above, “[s]ubject-matter jurisdiction is the power of a court to entertain and adjudicate a particular class of cases.” Kuchta, 141 Ohio St.3d 75, 2014-Ohio-4275, at ¶ 19. A decision by a court without subject-matter jurisdiction is void, and thus subject-matter jurisdiction can never be waived and may be raised at any time. Pratts at ¶ 11.
{30} On the other hand, “[a] court‘s jurisdiction over a particular case refers to the court‘s authority to proceed or rule on a case that is within the court‘s subject-matter jurisdiction.” Kuchta at ¶ 19, citing Pratts at ¶ 12. The improper exercise of jurisdiction over a particular case renders a judgment voidable. Pratts at ¶ 12, quoting Parker at ¶ 22 (Cook, J., dissenting), quoting Swiger at 462. “[T]his Court [has] recognized that ‘alleged errors in the trial court‘s exercise of its jurisdiction may be forfeited if not timely raised[.]‘”1 In re T.D., 9th Dist. Wayne No. 16AP0035, 2018-Ohio-204, ¶ 6, quoting Morris v. Mottern, 9th Dist. Medina No. 14CA0043-M, 2015-Ohio-4523, ¶ 24.
{31} We have already concluded that Summit County has subject-matter jurisdiction over this administrative appeal. Thus, ODOT‘s alternative argument regarding compliance with the procedural requirements of
ODOT‘s argument regarding the procedural irregularities associated with
{32} ODOT filed a motion to dismiss for lack of subject-matter jurisdiction which challenged the county in which the administrative appeal was filed. ODOT did not assert a jurisdictional objection based upon its failure to comply with the
{33} ODOT‘s assignment of error is overruled.
III.
{34} The Ohio Department of Transportation‘s assignment of error is overruled. The judgment of the Summit County Common Pleas Court is affirmed.
Judgment affirmed.
There were reasonable grounds for this appeal.
We order that a special mandate issue out of this Court, directing the Court of Common Pleas, County of Summit, State of Ohio, to carry this judgment into execution. A certified copy of this journal entry shall constitute the mandate, pursuant to App.R. 27.
Immediately upon the filing hereof, this document shall constitute the journal entry of judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the period for review shall begin to run. App.R. 22(C). The Clerk of the Court of Appeals is instructed to mail a notice of entry of this judgment to the parties and to make a notation of the mailing in the docket, pursuant to App.R. 30.
Costs taxed to Appellant.
LYNNE S. CALLAHAN
FOR THE COURT
HENSAL, J. DISSENTING.
{35} I respectfully dissent because I do not agree with the majority‘s conclusion that a certificate of qualification is a license for purposes of
APPEARANCES:
DAVE YOST, Attorney General, and WILLIAM J. COLE, L. MARTIN CORDERO, and ERIC M. HOPKINS, Assistant Attorneys General, for Appellant.
ANDREW J. NATALE, O. JUDSON SCHEAF, III, JEFFREY A. YEAGER, and ELISÉ K. YARNELL, Attorneys at Law, for Appellee.