City of Cincinnati v. Fourth Nat'l Realty, L.L.C.

163 Ohio St.3d 409

170 N.E.3d 832

The City of CINCINNATI, Appellant,

v.FOURTH NATIONAL REALTY, L.L.C., Appellee, et al.

No. 2019-0898

Supreme Court of Ohio.

Submitted August 18, 2020

Decided December 22, 2020

Paula Boggs Muething, Cincinnati City Solicitor, Marion E. Haynes III, Chief Counsel, and Mark R. Manning, Assistant City Solicitor, for appellant.

Holzapfel Law, L.L.C., and Eric C. Holzapfel, for appellee.

Dave Yost, Attorney General, Benjamin M. Flowers, Solicitor General, and Stephen P. Carney, Deputy Solicitor General, in support of neither side for amicus curiae, Ohio Attorney General Dave Yost.

French, J. {¶ 1} When a party seeks a declaratory judgment that a statute or municipal ordinance is unconstitutional, R.C. 2721.12 requires the party to serve its pleading on the Ohio Attorney General. This case requires us to decide when the attorney general must be served. Appellant, city of Cincinnati, argues that R.C. 2721.12 requires service on the attorney general at the inception of the case. Appellee, Fourth National Realty, L.L.C. ("Fourth National"), did not serve its counterclaim challenging the constitutionality of Cincinnati's zoning ordinances until more than two years into the litigation. According to Cincinnati, this delay in service divested the trial court of subject-matter jurisdiction over Fourth National's claim for declaratory relief.

{¶ 2} We disagree. While R.C. 2721.12(A) requires a party to serve its pleading on the attorney general before a court can rule on a claim for declaratory relief challenging the constitutionality of a statute or ordinance, we conclude that the failure to serve the attorney general at the inception of the action does not divest the trial court of its subject-matter jurisdiction. We therefore affirm the judgment of the First District Court of Appeals and remand the matter to the trial court for proceedings on Fourth National's constitutional challenge of Cincinnati's ordinance.

FACTS AND PROCEDURAL HISTORY

{¶ 3} On July 1, 2015, Cincinnati filed an action for injunctive relief against Fourth National, seeking the removal of a billboard sign. Cincinnati alleged that Fourth National had installed an outdoor advertising sign without obtaining the necessary permit and variance. Fourth National answered and filed a counterclaim, seeking a declaration that the city's outdoor advertising prohibitions violated its right to free speech under the First Amendment to the United States Constitution and its right to equal protection of the law under the Fourteenth Amendment to the United States Constitution.

{¶ 4} The parties filed competing motions for summary judgment. The trial court granted relief to the city in part, holding that Fourth National had not satisfied the redressability element of a constitutional challenge and thus could not challenge the constitutionality of the ordinance, because Fourth National was in violation of various other city ordinances. On appeal, the First District Court of Appeals concluded that Fourth National could challenge the constitutionality of certain of the city's sign-prohibition provisions on free-speech grounds and remanded the cause to the trial court. See Cincinnati v. Fourth Natl. Realty, L.L.C. , 2017-Ohio-1523, 88 N.E.3d 1278.

{¶ 5} On remand, the city filed a second motion for summary judgment, arguing that the trial court did not have subject-matter jurisdiction, because Fourth National had not served the attorney general with notice of the pending constitutional claim at the inception of Fourth National's case in accordance with R.C. 2721.12. Fourth National subsequently served the attorney general on January 26, 2018, almost two and a half years after first alleging constitutional violations in its declaratory-judgment action.

{¶ 6} The attorney general chose not to file a brief or otherwise participate in the case. The trial court concluded that it had acquired subject-matter jurisdiction because the attorney general had ultimately been served and the city had not been prejudiced by the delay in serving the attorney general.

{¶ 7} The parties appealed. The court of appeals affirmed in part and reversed in part and again remanded the cause to the trial court. The court of appeals stated that the trial court had acquired subject-matter jurisdiction over the action when Fourth National served the attorney general. The court reasoned that the attorney general ultimately had been served and had chosen not to participate.

{¶ 8} We accepted Cincinnati's discretionary appeal on the following proposition of law: "Service on the Attorney General of a [declaratory-judgment] claim alleging an ordinance is unconstitutional must be made at the inception of the case pursuant to R.C. 2721.12." See 156 Ohio St.3d 1497, 2019-Ohio-3505, 130 N.E.3d 293. The Ohio Attorney General filed an amicus brief in support of neither side.

ANALYSIS

{¶ 9} R.C. 2721.12(A) states:

[W]hen declaratory relief is sought under this chapter in an action or proceeding, all persons who have or claim any interest that would be affected by the declaration shall be made parties to the action or proceeding. * * *. In any action or proceeding that involves the validity of a municipal ordinance or franchise, the municipal corporation shall be made a party and shall be heard, and, if any statute or the ordinance or franchise is alleged to be unconstitutional, the attorney general also shall be served with a copy of the complaint in the action or proceeding and shall be heard.

{¶ 10} With respect to the attorney general, R.C. 2721.12(A) imposes two requirements when a declaratory-judgment action challenges the constitutionality of a statute or ordinance. First, the attorney general "shall be served with a copy of the complaint." And second, the attorney general "shall be heard." While R.C. 2721.12(A) requires the attorney general to be served a copy of the complaint (or other initial pleading), it contains no language dictating the timing of service on the attorney general. And there is no language in R.C. 2721.12 divesting the trial court of its subject-matter jurisdiction if parties do not complete service on the attorney general within a certain time. See Binder v. Cuyahoga Cty. , 161 Ohio St.3d 395, 2020-Ohio-5126, 163 N.E.3d 554, ¶ 23 (declining to find that trial court lacked subject-matter jurisdiction in absence of language explicitly removing that jurisdiction); Ohio High School Athletic Assn. v. Ruehlman , 157 Ohio St.3d 296, 2019-Ohio-2845, 136 N.E.3d 436, ¶ 9 (same). Construing R.C. 2721.12(A) as requiring service on the attorney general at the inception of a case would create a temporal requirement that simply does not exist in the statute.

{¶ 11} Cincinnati argues that in Cicco v. Stockmaster , 89 Ohio St.3d 95, 728 N.E.2d 1066 (2000), we held that R.C. 2721.12 requires service on the attorney general at the inception of a declaratory-judgment action. We inferred in Cicco that the General Assembly must have intended to require service on the attorney general "at the inception of the action" in order to give a reasonable amount of time to respond. Id. at 99, 728 N.E.2d 1066. But we did not create a rule in Cicco requiring service on the attorney general "at the inception of the action." Rather, we held in Cicco that a party who is challenging the constitutionality of a statute must do two things for the trial court to proceed on a claim for declaratory relief: (1) "assert the claim in the complaint (or other initial pleading)" and (2) "serve the pleading upon the Attorney General in accordance with methods set forth in Civ.R. 4.1." Id. at syllabus. Because the plaintiffs in Cicco asserted their constitutional challenge for the first time in their motion for summary judgment and sent a copy of the motion to the attorney general by ordinary mail, we concluded that the trial court lacked jurisdiction over their constitutional challenge. Id. at 98, 100-101, 728 N.E.2d 1066.

{¶ 12} By contrast, Fourth National satisfied both of the requirements in R.C. 2721.12(A), as construed in Cicco : (1) Fourth National asserted its constitutional challenge in a counterclaim and (2) it requested the sheriff's office to serve the counterclaim on the attorney general, in accordance with Civ.R. 4.1. Neither R.C. 2721.12(A) nor Cicco requires Fourth National to do anything more to proceed with its claim for declaratory relief.

{¶ 13} Dismissal of Fourth National's counterclaim here would also contradict our precedent allowing parties to rectify belated service on the attorney general or the failure to serve a necessary party to a declaratory-judgment action. In Leisure v. State Farm Mut. Auto. Ins. Co. , 89 Ohio St.3d 523, 733 N.E.2d 1117 (2000), we affirmed the lower court's judgment, which vacated rulings entered by the trial court because the plaintiffs had not served the attorney general. But instead of dismissing the action, we remanded the cause to the trial court to permit the plaintiffs to serve the attorney general. Id. at 524, 733 N.E.2d 1117. In Plumbers & Steamfitters Local Union 83 v. Union Local School Dist. Bd. of Edn ., 86 Ohio St.3d 318, 323, 715 N.E.2d 127 (1999), we allowed the party seeking a declaratory judgment to amend its pleading to join a necessary party, even though the absence of a necessary party constitutes a jurisdictional defect. We also held that a court abuses its discretion by dismissing the action rather than allowing joinder of the absent party. Id. at 323-324, 715 N.E.2d 127. When a party has failed to serve the attorney general or a necessary party, courts should allow parties to rectify belated service rather than dismiss the action.

CONCLUSION

{¶ 14} While R.C. 2721.12(A) requires service on the attorney general before a court can rule on a claim for declaratory relief challenging the constitutionality of a statute or ordinance, we conclude that the failure to serve the attorney general at the inception of the action does not divest the trial court of...