SUPPORTIVE SOLUTIONS, L.L.C., Appellee, v. ELECTRONIC CLASSROOM OF TOMORROW, Appellant, et al.
No. 2012-0790
Supreme Court of Ohio
Submitted March 13, 2013—Decided June 12, 2013
137 Ohio St.3d 23, 2013-Ohio-2410
Judgment accordingly..
O‘CONNOR, C.J., and PFEIFER, O‘DONNELL, LANZINGER, FRENCH, and O‘NEILL, JJ., concur.
KENNEDY, J., dissents and would impose a stayed six-month suspension.
Patricia J. Schraff and Todd Petersen, for relator.
Gallagher Sharp, Monica A. Sansalone, and Jamie A. Price, for respondent.
SUPPORTIVE SOLUTIONS, L.L.C., Appellee, v. ELECTRONIC CLASSROOM OF TOMORROW, Appellant, et al.
[Cite as Supportive Solutions, L.L.C. v. Electronic Classroom of Tomorrow, 137 Ohio St.3d 23, 2013-Ohio-2410.]
(No. 2012-0790—Submitted March 13, 2013—Decided June 12, 2013.)
{1} In this appeal, we consider whether a trial court‘s decision denying a defendant leave to assert the defense of political-subdivision immunity via an amended answer is a final, appealable order. We hold that it is because the denial of a political subdivision‘s motion for leave to file an amended answer to assert the affirmative defense of political-subdivision immunity denies that political subdivision the benefit of the alleged immunity pursuant to
Facts and Procedural History
{2} We gave a detailed history of this case in State ex rel. Electronic Classroom of Tomorrow v. Cuyahoga Cty. Court of Common Pleas, 129 Ohio St.3d 30, 2011-Ohio-626, 950 N.E.2d 149 (”ECOT I“). Here, we reiterate only those facts necessary to our discussion of the issue now on appeal.
{3} Appellant, Electronic Classroom of Tomorrow (“ECOT“), is an internet-based community school, established pursuant to
{4} In March 2008, Supportive Solutions sued ECOT in the Cuyahoga County Court of Common Pleas. Supportive Solutions’ amended complaint asserted claims for breach of implied contract, misrepresentation, negligent misrepresentation, promissory estoppel, unjust enrichment, fraud and fraud in the inducement, respondeat superior, and defamation. ECOT filed an answer to Supportive Solutions’ amended complaint, as well as counterclaims for breach of contract, misrepresentation, negligent misrepresentation, and fraud. ECOT did not raise the affirmative defense of political-subdivision immunity in its answer. Supportive Solutions subsequently filed a second amended complaint, adding Lucas County Educational Service Center as a defendant and adding a claim for tortious interference with business relations.1 ECOT filed an answer to the second amended complaint, incorporating its earlier answer and counterclaims and denying all additional allegations, but, again, not raising political-subdivision immunity as an affirmative defense.
{5} In January 2010, ECOT filed a motion for partial summary judgment, arguing, in part, that it was entitled to political-subdivision immunity, pursuant to
{6} ECOT immediately appealed the trial court‘s denial of leave to file an amended answer. Meanwhile, despite ECOT‘s pending appeal, the trial court conducted a jury trial on Supportive Solutions’ remaining claims, and the jury returned a verdict in favor of Supportive Solutions on claims of breach of express and implied contract and negligent misrepresentation. The trial court entered judgment against ECOT on the jury verdict in the amount of $1,206,400, awarded prejudgment interest, and denied ECOT‘s motion for judgment notwithstanding the verdict or for a new trial. ECOT thereafter filed a second appeal—from the judgment on the jury verdict and the trial court‘s denial of its posttrial motions. The Eighth District Court of Appeals dismissed ECOT‘s first appeal on July 30, 2010, for lack of a final, appealable order, but it subsequently reinstated that appeal and consolidated it with ECOT‘s second appeal.
{7} While its appeals were pending, ECOT filed an original action in this court for a writ of prohibition to prevent the trial court from enforcing its judgment and for a writ of mandamus requiring the trial court to vacate the allegedly invalid portion of its judgment and to stay execution of any surviving portion of the judgment without bond. We held that, whether or not the denial of ECOT‘s motion for leave to file an amended answer was a final, appealable order, ECOT‘s first appeal divested the trial court of jurisdiction to proceed with a trial of any claim that might be subject to that defense. ECOT I, 129 Ohio St.3d 30, 2011-Ohio-626, 950 N.E.2d 149, at ¶ 16. Accordingly, we issued a writ of prohibition, which precluded the trial court from enforcing those portions of its judgment that were subject to ECOT‘s appeal from the denial of its motion for leave to amend its answer, and a writ of mandamus, which ordered the trial court to vacate those portions of the judgment. Id. at ¶ 31. We also determined that ECOT was entitled to a writ of mandamus compelling the trial court to stay the surviving portion of its judgment without a bond. Id. at ¶ 30-31.
{8} Following our decision in ECOT I, the court of appeals dismissed ECOT‘s consolidated appeals. Supportive Solutions, L.L.C. v. Electronic Classroom of Tomorrow, 8th Dist. Nos. 95022 and 95287, 2012-Ohio-1185, 2012 WL 985838. It held that it lacked jurisdiction over ECOT‘s appeal from the judgments entered as a result of trial because this court had ordered the trial court to vacate those judgments. The court of appeals also addressed whether the denial of ECOT‘s motion for leave to file an amended answer was a final, appealable order. The
{9} This court accepted ECOT‘s discretionary appeal to consider the following proposition of law: “Any order that denies the benefit of an alleged immunity to a political subdivision is immediately appealable pursuant to
Analysis
{10} An appellate court can review only final orders, and without a final order, an appellate court has no jurisdiction. Hubbell v. Xenia, 115 Ohio St.3d 77, 2007-Ohio-4839, 873 N.E.2d 878, ¶ 9, citing Gen. Acc. Ins. Co. v. Ins. Co. of N. Am., 44 Ohio St.3d 17, 20, 540 N.E.2d 266 (1989). Generally, an order denying leave to amend a pleading is not a final, appealable order. See Trotwood v. S. Cent. Constr., L.L.C., 192 Ohio App.3d 69, 2011-Ohio-237, 947 N.E.2d 1291, ¶ 54 (2d Dist.); Worthington v. Wells Fargo Bank Minnesota, N.A., 5th Dist. No. 10 CA 40, 2010-Ohio-4541, 2010 WL 3722628, ¶ 30-32.
{11}
{12} This court addressed the scope of
{13} In accordance with established principles of statutory interpretation, we began our analysis in Hubbell by turning to the plain language of the statute to determine legislative intent. We stated that the General Assembly‘s use of the words “benefit” of an “alleged” immunity in
{14} Ohio courts of appeals, including the Eighth District, have applied the reasoning of Hubbell to hold that denials of motions for judgment on the pleadings and motions to dismiss based on political-subdivision immunity are final orders. See, e.g., DiGiorgio v. Cleveland, 196 Ohio App.3d 575, 2011-Ohio-5824, 964 N.E.2d 495 (8th Dist.).
{15} Here, the court of appeals acknowledged Hubbell, but held that Hubbell‘s “broad interpretation” of
{16} The court of appeals held that the order denying ECOT leave to amend its answer did not deny the benefit of an alleged immunity, because it “made no determination about immunity.” Id. at ¶ 20. That reasoning directly conflicts with our statement in Hubbell that
{17} Unlike in Hubbell, the trial court‘s denial of leave for ECOT to amend its complaint determines ECOT‘s entitlement to immunity and precludes a finding of immunity in this case. Statutory immunity, including political-subdivision immunity, is an affirmative defense, and it is waived if not raised in a timely fashion. Turner v. Cent. Local School Dist., 85 Ohio St.3d 95, 98, 706 N.E.2d 1261 (1999). In Turner, at 98, we stated that “as a matter of course, a properly pleaded answer should * * * include[] the statutory-immunity defense * * * because, in most cases, the [Political Subdivision Tort Liability] Act could provide a complete defense.” We noted that the possibility of waiver makes it “extremely important and prudent” to plead all defenses as early as possible. Id. at 99. ECOT agrees that absent leave to amend its answer, it will be deemed to have waived its immunity defense. Thus, the trial court‘s ruling forecloses ECOT from enjoying the benefit of the alleged immunity.
{18} The court of appeals justified its interpretation of Hubbell by referring to the waiver rule discussed in Turner: “We find that no caveat or niche has yet been carved out giving a political subdivision an exception to the waiver provision of the Civil Rules.” 2012-Ohio-1185, 2012 WL 985838, ¶ 18. In Turner, we held that the trial court abused its discretion by granting the political-subdivision defendant leave to amend its answer and assert a statutory-immunity defense. Therefore, we held, the defendant waived that defense. We based our holding, however, on the merits of the motion for leave. There, the defendant moved for leave to amend its answer on remand, after the reversal of summary judgment in its favor on another ground, almost three years after the commencement of the action, and without explanation for its failure to assert the affirmative defense sooner. We noted that the defendant‘s delay forced the plaintiffs to expend time and money to oppose the defendant‘s first motion for summary judgment in the trial court and on appeal, including a request for discretionary jurisdiction in this court. Id. at 99.
{19} There is no dispute that the waiver rule applies to a political subdivision, just as it applies to other defendants, or that a political subdivision waives its
{20} The court of appeals’ discussion of waiver relates not to the question of
{21} In support of its holding, the court of appeals expressed concern that expanding Hubbell could lead to abuse by political subdivisions delaying the assertion of a timely immunity defense. 2012-Ohio-1185, 2012 WL 985838, ¶ 16-17. We have explicitly rejected the use of judicial policy preferences to override valid legislation, however. Hubbell, 115 Ohio St.3d 77, 2007-Ohio-4839, 873 N.E.2d 878, at ¶ 22. Thus, neither our notions of public policy nor those of the appellate court establish a basis for a refusal to apply
{22} Although the issue is beyond the scope of its proposition of law, which concerns only the finality of the trial court‘s denial of leave to amend its answer, ECOT urges this court to further hold that the trial court abused its discretion by denying its motion for leave and that ECOT is entitled to immunity as a matter of law. The court of appeals has not considered whether the denial of ECOT‘s motion for leave to amend its answer amounts to an abuse of discretion, and neither the court of appeals nor the trial court has considered whether ECOT would be entitled to summary judgment on the ground of statutory immunity had it been permitted to raise that defense in an amended answer. We decline to decide those issues before the lower courts have the opportunity to address them in the first instance.
{23} The trial court‘s denial of ECOT‘s motion for leave to file an amended answer to raise the affirmative defense of political-subdivision immunity precluded ECOT from enjoying the benefits of the alleged immunity. The court of appeals therefore possessed jurisdiction to determine ECOT‘s appeal of that order pursuant to
Judgment reversed
and cause remanded.
O‘CONNOR, C.J., and O‘DONNELL, KENNEDY, and O‘NEILL, JJ., concur.
PFEIFER and LANZINGER, JJ., dissent.
LANZINGER, J., dissenting.
{24} I respectfully dissent and would affirm the judgment of the Eighth District Court of Appeals. Interpreting
{25} The Hubbell majority accepted the idea that an order denying the city of Xenia summary judgment on grounds of immunity was an appealable order, despite the fact that the order did not completely resolve the immunity question between the parties. The Hubbell majority held that “[w]hen a trial court denies a motion in which a political subdivision or its employee seeks immunity under
{26} In a well-reasoned opinion, this court unanimously held that the denial of a
{27} As the court of appeals recognized, political subdivisions are subject to the same civil rules as are other litigants.
{28}
{29} A trial court‘s decision to grant or deny a party leave to amend a pleading is reviewed on the standard of abuse of discretion. Wilmington Steel Prods., Inc. v. Cleveland Elec. Illum. Co., 60 Ohio St.3d 120, 122, 573 N.E.2d 622 (1991). An abuse of discretion connotes more than an error of law or of judgment; it implies that the court‘s attitude is unreasonable, arbitrary, or unconscionable. Blakemore v. Blakemore, 5 Ohio St.3d 217, 219, 450 N.E.2d 1140 (1983), citing State v. Adams, 62 Ohio St.2d 151, 157, 404 N.E.2d 144 (1980).
{30} If the majority is correct that denial of leave to file an amended answer under these circumstances is immediately appealable, then the only issue is whether the trial court acted unconscionably in denying leave. Furthermore, if ECOT was deprived of its defense, it was because of its own inactivity, not a denial by the court.
{31} The majority states that
PFEIFER, J., concurs in the foregoing opinion.
Demer & Marniella, L.L.C., John A. Demer, and James A. Marniella; and Paul W. Flowers Co., L.P.A., and Paul W. Flowers, for appellant.
Davis & Young and Kurt D. Anderson, urging reversal for amicus curiae, Ohio Association of Civil Trial Attorneys.