V.T. LARNEY LTD., et al., Appellants, - vs - OHIO CIVIL RIGHTS COMMISSION, et al., Appellees.
CASE NO. 2022-T-0112
IN THE COURT OF APPEALS OF OHIO ELEVENTH APPELLATE DISTRICT TRUMBULL COUNTY
Decided: September 5, 2023
[Cite as V.T. Larney, Ltd. v. Ohio Civ. Rights Comm., 2023-Ohio-3123.]
Administrative Appeal from the Court of Common Pleas Trial Court No. 2021 CV 00704
Judgment: Affirmed in part and reversed in part; remanded
Paul M. Greenberger and Majeed G. Makhlouf, Berns, Ockner & Greenberger, LLC, 3733 Park East Drive, Suite 200, Beachwood, OH 44122 (For Appellants).
Dave Yost, Ohio Attorney General, State Office Tower, 30 East Broad Street, 16th Floor, Columbus, OH 43215; David A. Oppenheimer and Adrian C. Feiertag, Assistant Attorneys General, 615 West Superior Avenue, 11th Floor, Cleveland, OH 44113 (For Appellee, Ohio Civil Rights Commission).
Donna Sargeant, pro se, 147 Youngstown Hubbard Road, Apt. 2, Hubbard, OH 44425 (Appellee).
MARY JANE TRAPP, J.
{1} Appellants, V.T. Larney Ltd., Equity Management LLC, and Vince T. Larney (“Mr. Larney“) (collectively, “the appellants“), appeal the judgment of the Trumbull County Court of Common Pleas, in which the court found that the final order of appellee, Ohio Civil Rights Commission (“the commission“), is supported by reliable, probative, and substantial evidence and dismissed the appellants’ petition for judicial review. The
{2} The appellants assert three assignments of error, contending (1) the commission failed to affirmatively plead jurisdictional facts necessary to invoke its subject matter jurisdiction over the complaint; (2) the commission lacked subject matter jurisdiction to adjudicate the complaint; (3) the trial court erred in stating the administrative law judge (“ALJ“) found a violation of
{3} After a careful review of the record and pertinent law, we find as follows:
{4} (1) The appellants have not established the commission failed to affirmatively plead jurisdictional facts necessary to invoke its subject matter jurisdiction over the complaint. The appellants appear to be mistaking the requirement to plead “affirmatively” with a requirement to plead “with particularity,” which are separate concepts. In addition, to the extent the appellants are actually challenging the commission‘s standing, it does not involve subject matter jurisdiction.
{5} (2) The appellants have not established the commission lacked subject matter jurisdiction to adjudicate the complaint. By failing to object to the ALJ‘s jurisdictional factual findings, the appellants waived their right to contest them in the trial court and on appeal.
{7} (4) The appellants have not established the trial court misapplied the law regarding a facial constitutional challenge to
{8} Thus, we affirm the judgment of the Trumbull County Court of Common Pleas in part, reverse in part, and remand for further proceedings.
Substantive and Procedural History
{9} The appellants own аnd manage rental properties in Mahoning and Trumbull Counties, including a single-family home in Hubbard, Ohio. In October 2017, Ms. Sargeant spoke with Mr. Larney by telephone about renting the Hubbard property. According to Ms. Sargeant, Mr. Larney asked her how many people would be living at the property, and she informed him it would be herself and her two children. Mr. Larney asked for the children‘s ages, and she stated they were seven and one. Mr. Larney and Ms. Sargeant scheduled a viewing for the following day, and Mr. Larney indicated he would call to confirm. The next day, Mr. Larney and Ms. Sargeant spoke again by telephone. Mr. Larney told Ms. Sargeant she needed to bring her children to the viewing, and she refused. Mr. Larney stated he would call back later but never did. Mr. Larney subsequently rented the property to two applicants without children.
{11} After attempting and failing to conciliate the alleged practices, the commission issued a three-count complaint against the appellants in January 2019. The commission alleged the appellants’ actions denied housing accommodations to Ms. Sargeant due to her familial status in violation of
{12} With leave of the ALJ, the commission issued an amended complaint. In particular, the commission amended count 2 to allege the appellants made inquiry or elicited information regarding Ms. Sargeant‘s familial status in violation of
{13} The appellants appeared through counsel and filed an answer to the amended complaint. The appеllants admitted certain procedural allegations but denied
{14} A hearing was held before the ALJ, at which witnesses testified and documentary exhibits were submitted.
{15} In October 2021, the ALJ issued a report setting forth findings of fact, conclusions of law, and recommendations. The ALJ found the credible evidence in the record supported a determination the appellants violated
{16} The appellants submitted objections to the ALJ‘s report, and the commission submitted a response.
{17} In May 2021, the commission issued a final order. The commission rejected the appellants’ objections to the ALJ report, adopted the ALJ‘s report, and issued orders consistent with the ALJ‘s recommendations.
{18} In June 2021, the appellants, through new counsel, filed a petition for judicial review in the Trumbull County Court of Common Pleas. After the filing of the record and the submission of briefs, the trial court filed a judgment entry finding the commission‘s final order was supported by reliable, probative, and substantial evidence and dismissed the appellants’ petition.
{19} The appellants appealed and raise the following three assignments of error:
{20} “[1.] The trial court erred in its application or interpretation of the law, or its decision is unsupported by a preponderance of Reliable, Probative or Substantial
{21} “[2.] The trial court committed reversible error by affirming jurisdiction over the §4112.02(H)(19) claim in the absence of a charge, of a complainant, of an aggrieved person, and by further finding that the ALJ made a specific finding that the ‘no-pets policy’ rule violated §4112.02(H)(7).”
{22} “[3.] The trial court committed reversible error by determining that Appellants’ failure to exercise their statutory right under §4112.05(B) to elect a civil action under §4112.051(A)(1) & (A)(2), deprived them of the right to contest the unconstitutionality of said statutes for the first time in the §4112.06 appeal below.”
Standard of Review
{23} A trial сourt‘s review of the commission‘s final order is governed by
{24} “The role of the appellate court in reviewing commission orders is more limited—to determine whether the trial court abused its discretion in finding that there was reliable, probative and substantial evidence to support the commission‘s order.” Id. “A trial court abuses its discretion where its decision is clearly erroneous, that is, the trial court misapplies the law to undisputed facts.” Id.
{25} The appellants’ first assignment of error challenges the commission‘s subject matter jurisdiction.
{26} “Subject-matter jurisdiction refers to the constitutional or statutory power of a [tribunal] to adjudicate a case.” Pivonka v. Corcoran, 162 Ohio St.3d 326, 2020-Ohio-3476, 165 N.E.3d 1098, ¶ 20. The appellants did not challenge the commission‘s subject matter jurisdiction in the administrative proceedings. However, the Supreme Court of Ohio has held “[w]hen an administrative agency renders a decision without subject-matter jurisdiction, the order is void and subject to challenge at any time.” In re Complaint of Pilkington N. Am., Inc., 145 Ohio St.3d 125, 2015-Ohio-4797, 47 N.E.3d 786, ¶ 22. Questions of subject matter jurisdiction are reviewed de novo. State ex rel. Ohio Assn. of Pub. School Employees v. Willoughby-Eastlake City School Dist., 2022-Ohio-4242, 202 N.E.3d 111, ¶ 9 (11th Dist.).
Pleading Deficiencies
{27} The appellants contend the commission failed to affirmatively plead jurisdictional facts necessary to invoke its subject matter jurisdiction over the complaint.
{28} Ohio is a notice-pleading state. Cincinnati v. Beretta U.S.A. Corp., 95 Ohio St.3d 416, 2002-Ohio-2480, 768 N.E.2d 1136, ¶ 29. Generally, “[a] pleading that sets forth a claim for relief * * * shall contain (1) a short and plain statement of the claim showing that the party is entitled to relief, and (2) a demand for judgment for the relief to which the party claims to be entitled.”
{30} The commission was established pursuant to
Charge of Discrimination
{31} The appellants first argue the commission failed to sufficiently plead the existence of a filed charge of discrimination.
{32} The commission alleged in its complaint that Ms. Sargeant “filed a timely charge with the Ohio Civil Rights Commission on or about January 30, 2018, against Respondents alleging an unlawful discriminatory practice.” The appellants contend the commission was required to plead the existence of a charge filed alleging housing discrimination in violation of
{33} We disagree with the appellants’ reading of the statute.
{34} The appellants appear to be mistaking the requirement to plead “affirmatively” with a requirement to plead “with particularity.” These are separate and distinct concepts. See New Hampshire Ins. Co. v. MarineMax of Ohio, Inc., 408 F.Supp.2d 526, 529 (N.D.Ohio 2006) (Fed.R.Civ.P. 8(c)‘s requirement that certain affirmative defenses shall be set forth affirmatively does not mean they must be pleaded
{35} While the Supreme Court of Ohio has instructed plaintiffs in special statutory proceedings to affirmatively plead jurisdictional facts, Marysville, supra, at ¶ 11, it has not imposed a particularity requirement. In fact, the court has only required particularity “[i]n a few carefully circumscribed cases,” none of which are applicable here. York v. Ohio State Hwy. Patrol, 60 Ohio St.3d 143, 145, 573 N.E.2d 1063 (1991); see also
{36} Further, the appellants’ argument regarding
Conciliation
{37} The appellants next argue the commission failed to sufficiently plead conciliation. Relevant here is
{38} The commission alleged in its complaint that it рresented “a proposed Conciliation Agreement and Consent Order” to the appellants; it “invited” the appellants “to conciliation“; the appellants did not sign the proposed agreement and order or submit an acceptable counter proposal; and its “efforts to eliminate the alleged unlawful discriminatory practice by informal conciliation failed.” The appellants contend the commission was required to plead failed conciliation of a “pre-issued,” draft complaint. The appellants appear to be referencing the complaint the commission “initiates” under
{39} Again, we disagree with the appellants’ reading of the statute. Under
{41} “If, after a preliminary investigation and the use of informal methods of conference, conciliation, and persuasion, or alternative dispute resolution, under this section, the commission is satisfied that any unlawful discriminatory practice will be eliminated, it may treat the charge involved as being conciliated and enter that disposition on the records of the commission. If the commission fails to effect the elimination of an unlawful discriminatory practice by informal methods of conference, conciliation, and persuasion, or by altеrnative dispute resolution under this section and to obtain voluntary compliance with [R.C. Chapter 4112], the commission shall issue and cause to be served upon any person, including the respondent against whom a complainant has filed a charge pursuant to [R.C. 4112.05(B)(1)], a complaint stating the charges involved * * *.” (Emphasis added.)
{42} This reading is also confirmed by the Supreme Court Ohio‘s decision in State ex rel. Republic Steel Corp. v. Ohio Civ. Rights Comm., 44 Ohio St.2d 178, 339 N.E.2d 658 (1975), where the court held, “Pursuant to
{43} The appellants further contend since the commission amended its complaint, it was required to plead failed conciliation of a “pre-issued,” draft amended complaint.
{45} This provision does not require additional conciliation prior to the filing of an amended complaint. This is because, as explained above, the commission conciliates alleged unlawful discriminatory practices. There is federal authority indicating the Equal Employment Opрortunity Commission—the commission‘s federal counterpart—must conciliate additional claims prior to amending its complaint. See Haykel v. G.F.L. Furniture Leasing Co., 76 F.R.D. 386, 391 (N.D.Ga.1976) (“to the extent * * * the E.E.O.C. should desire to broaden the scope of the instant litigation, it would be incumbent * * * to first conciliate additional claims and, thereafter, seek leave of court to amend the complaint * * *“). However, the commission‘s amended complaint did not assert an additional claim; rather, the commission amended count 2 to allege the appellants’ actions violated
Probable Cause
{46} Finally, the appellants argue the commission failed to sufficiently plead the existence of probable cause. The commission alleged in its complaint that “in a letter dated November 15, 2018,” it “notified [Ms. Sargeant] and [the appellants] of its finding that it is probable that [the appellants] engaged in practices unlawful under
{47} As explained above, the commission was not required to plead jurisdictional facts with this level of specificity. In addition, the legal basis of the appellants’ probable cause argument is unclear. The appellants may be relying on
{48} “[T]he commission shall complete a preliminary investigation of a charge filed pursuant to [R.C. 4112.05(B)(1)] that alleges an unlawful discriminatory practice described in [R.C. 4112.02(H)], and shall take one of the following actions, within one hundred days after the filing of the charge: * * * [n]otify the complainant and the respondent that it is not probable that an unlawful discriminatory practice described in [R.C. 4112.02(H)] has been or is being engaged in and that the commission will not issue a complaint in the matter[.]” (Emphasis added.)
{49}
{50} Within their first assignment of error, the appellants also contend the commission failed to prove the jurisdictional facts at the administrative hearing.
{51} The appellants’ argument is based on a faulty premise. The appellants contend subject matter jurisdiction cannot be “admitted, waived or stipulated“; therefore, “no conduct” on their part “can confer jurisdiction.” However, the Supreme Court of Ohio has held “[a]lthough adverse parties may not confer jurisdiction upon a court by mutual consent, where none would otherwise exist, they may stipulate the truth of facts that are sufficient to confer jurisdiction.” (Emphasis added.) Beatrice Foods Co. v. Porterfield, 30 Ohio St.2d 50, 282 N.E.2d 355 (1972), paragraph two of the syllabus. Therefore, “a party may not challenge the jurisdiction of the court when such jurisdiction is based upon previously uncontested or admitted facts.” Weightman v. Weightman, 10th Dist. Franklin No. 98AP-1021, 1999 WL 354405, *2 (May 13, 1999); accord Kaydo v. Kaydo, 11th Dist. Lake No. 2022-L-021, 2022-Ohio-4055, ¶ 32-34.
{52} Here, the ALJ issued express findings of fact regarding the commission‘s jurisdiction. The appellants stated in their objections they were not contesting these facts.
{53} The аppellants’ first assignment of error is without merit.
{54} The appellants’ second assignment of error involves their alleged “no-animals” rule.
{55} The appellants contend the trial court erred by stating the ALJ found they violated
{56} Contrary to the commission‘s suggestions on appeal, claims under sections (H)(7) and (H)(19) are separate and distinct.
{57} Section (H)(7) is analogous to
{58} By contrast,
{59} Section (H)(19) is analogous to
{60} A party‘s violation of (H)(7) does not necessarily constitute a violation of (H)(19). For instance, in Fair Hous. Resources Ctr., supra, the plaintiff filed a “statement”
{61} A review of the ALJ‘s report indicates it determined the appellants violated section (H)(19) rather than section (H)(7). The ALJ did reference section (H)(7) in one of its findings of fact. Specifically, the ALJ wrote, “During the Commission‘s investigation of Complainant‘s charge, the Commission received a copy of Respondent EMLL‘s Tenant Rules and Regulations that contained a rule stating ‘no pets or animal of any kind (Resident or Visiting)’ with no written exception for service animals or emotional support animals.” In a footnote, the ALJ wrote, ”
{62} In its conclusions of law and discussion, however, the ALJ expressly determined:
{63} “The Commission alleged that [the appellants] * * * maintained a policy that failed to take into consideration those with disabilities that require the assistance of animals. * * * These allegations, if proven, would constitute a violation of
{64} “* * *”
{65} “[The appellants] maintained a policy that failed to take into consideration those with disabilities that require the assistance of an animal in violation of
{66} In their appeal in the trial court, the appellants argued they did not violate section (H)(19) because no disabled person requested or was denied an accommodation. The trial court rejected this argument and stated, “[P]rinting and disseminating the rule is a violation in and of itself under
{67} The appellants next contend the record is devoid of evidence establishing they violated section (H)(19). Since the trial court did not address this argument, it is unripe for appellate review.
{68} Finally, the appellants appear to challenge the commission‘s subject matter jurisdiction over the section (H)(19) claim. We have rejected this jurisdictional argument in our disposition of the appellants’ first assignment of error.
Constitutional Challenge
{70} The appellants’ third assignment of error involves their constitutional challenge to the statutory process for determining damages.
{71} The appellants contend they were denied their right to have a jury decide the issue of damages in violation of Article I, Section 5 of the Ohio Constitution (“The right of trial by jury shall be inviolate * * *“). The appellants acknowledge they did not elect a civil jury trial under
{72} The appellants did not assert their constitutional claim in the administrative proceedings; rather, they raised it for the first time in the trial court. The appellants contend this was procedurally proper because the commission is not authorized to determine constitutional issues. See Mobil Oil Corp. v. Rocky River, 38 Ohio St.2d 23,
{73} The appellants’ contention is not consistent with the Supreme Court of Ohio‘s more recent precedent. In Reading v. Pub. Util. Comm. of Ohio, 109 Ohio St.3d 193, 2006-Ohio-2181, 846 N.E.2d 840, the court held “a facial constitutional challenge to a statute need not first be raised before the [administrative agency]. However, a litigant must raise an as-applied constitutional challenge in the first instance during the proceedings before the [administrative agency] in order to allow the parties to develop an evidentiary record.” (Emphasis sic.) Id. at ¶ 16.
{74} The appellants do not state whether they are asserting a facial or an as-applied challenge to
{75} The appellants contend the trial court erred in finding they waived their constitutional claim. However, the trial court did not reject the appellants’ claim on the basis of waiver. Rather, the trial court found
{76} Although the trial court did not use the word “standing,” its analysis implicates that principle. “In order to have standing to attack the constitutionality of a legislative enactment, the private litigant must generally show that he or she has suffered
{77} The appellants did not elect a civil action under
{78} The appellants’ third assignment of error is without merit.
Conclusion
{79} In sum, the appellants’ first and third assignments of error lack merit. Their second assignment of error has merit in part. We reverse the trial court‘s determination regarding the appellants’ “no animals” rule and remand with instructions for the trial court to consider whether reliable, probative, and substantial evidence on the record supports the commission‘s finding that the appellants violated
{80} For the foregoing reasons, the judgment of the Trumbull County Court of Common Pleas is affirmed in part and reversed in part, and this matter is remanded for further proceedings consistent with this opinion.
EUGENE A. LUCCI, J., concurs,
MATT LYNCH, J., concurs in part and dissents in part, with a Dissenting Opinion.
{81} The majority properly vacates the lower court‘s determination that the Respondents violated the “no animals” rule (
{82} It has often and with good reason been affirmed that “[a]n administrative agency has no authority beyond what is conferred by statute and it may only exercise those powers that are expressly granted by the General Assembly.” State ex rel. Lucas Cty. Bd. of Commrs. v. Ohio Envirоnmental Protection Agency, 88 Ohio St.3d 166, 171, 724 N.E.2d 411 (2000); Spellman Outdoor Advertising Servs., LLC v. Ohio Turnpike & Infrastructure Comm., 2016-Ohio-7152, 72 N.E.3d 229, ¶ 23 (11th Dist.); Burton v. Harris, 2013-Ohio-1058, 987 N.E.2d 745, ¶ 19 (10th Dist.) (“an administrative agency‘s acts may not exceed the parameters of the authority legislatively granted to the agency“); see also Lake Front Med. LLC v. Ohio Dept. of Commerce, 2022-Ohio-4281, 202 N.E.3d 156, ¶ 92 (11th Dist.) (Lynch, J., concurring) (“[w]hile the administrative agencies within our country serve a valid purpose, their power to act in a role that goes beyond the scope of their authority undercuts citizens’ rights and expectations to due process, consistent results, and confuses the role of the different branches of our government“).
{84} Under the relevant version of the statute, “[a]ny person may file a charge with the commission alleging that another person has engaged or is engaging in an unlawful discriminatory practice.”
{85} That the investigation of discriminatory practices described in division (H) requires an underlying charge is further demonstrated by the following provision: “the commission shall complete a preliminary investigation of a charge filed pursuant to division (B)(1) of this section that alleges an unlawful discriminatory practice described in division (H) of sectiоn 4112.02 of the Revised Code,” upon which it “shall take one of the following actions” such as initiating a complaint.
{86} In the present case, the charge filed by the Complainant pursuant to
{87} This court has affirmed that the filing of a valid charge pursuant to
{88} The majority dismisses the Respondents’ arguments relative to
{89} For the foregoing reasons, I respectfully dissent and would dismiss the Civil Rights Commission‘s claim relative to
MATT LYNCH
JUDGE