General Motors Corp. v. Joe O'Brien Chevrolet, Inc.

693 N.E.2d 317, 118 Ohio App. 3d 470
CourtOhio Court of Appeals
DecidedFebruary 27, 1997
DocketNo. 96APE06-779.
StatusPublished
Cited by27 cases

This text of 693 N.E.2d 317 (General Motors Corp. v. Joe O'Brien Chevrolet, Inc.) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
General Motors Corp. v. Joe O'Brien Chevrolet, Inc., 693 N.E.2d 317, 118 Ohio App. 3d 470 (Ohio Ct. App. 1997).

Opinion

*474 Lazarus, Judge.

This matter is before this court upon the appeal of Joe O’Brien Chevrolet, Inc., and John P. O’Brien (“O’Brien”) from the judgment of the Franklin County Court of Common Pleas reversing an administrative ruling of the Ohio Motor Vehicle Dealers Board (“board”).

On July 29, 1994, and August 2, 1994, appellee, General Motors Corporation (“GMC”), notified O’Brien and other same-line dealers of its intention to relocate intervenor-appellee, Bass Chevrolet, Inc. (“Bass”), from its current location on Northfield Road in Warrensville Heights, Ohio, to 27100 Chagrin Boulevard in Orange Village, Ohio. The notices did not state specific grounds for the intended relocation. On August 10, 1994, O’Brien filed a protest with the board pursuant to R.C. 4715.50(A). In May 1995, an evidentiary hearing was held before a hearing examiner. The hearing examiner recommended that the proposed relocation be denied by the board on the grounds that GMC had not established good cause under R.C. 4517.51 to relocate the dealership and that GMC had failed to comply with the notice requirements of R.C. Chapter 4517. After receiving the proposed decision from the hearing examiner, the board failed to act within thirty days, and pursuant to R.C. 4517.58 the board’s inaction resulted in the recommendation being approved.

GMC appealed to the Franklin County Court of Common Pleas pursuant to R.C. 119.12. That court reversed the decision of the board, finding that the board’s order was not supported by substantial, reliable, and probative evidence and was not in accordance with law.

■ O’Brien has pursued an appeal to this court, 1 assigning seven errors for our consideration:

“1. This court lacks jurisdiction because the common pleas court decision is not final and appealable as Civil Rule 52 findings have not been made.
“2. The common pleas court lacked jurisdiction as the agency’s order was not final and appealable pursuant to O.R.C. §§ 4517.58,119.12 and 2505.02.
“3. Appellee, General Motors, gave inadequate notice pursuant to Ohio Revised Code § 4517.50.
*475 “4. The common pleas court erred by applying the wrong burden of proof standard to appellee in violation of O.R.C. §§ 4517.51, 4517.57(C) and 4517.65(D).
“5. The common pleas court erred by failing to give deference to the administrative agency’s resolution of evidentiary conflicts.
“6. The common pleas court abused its discretion by determining that the administrative agency’s decision was not supported by reliable, probative and substantial evidence in accordance with law.
“7. The trial court erred by failing to consider appellants’ motion to stay.”

R.C. 4517.50 provides that no motor vehicle franchisor shall establish or relocate a dealership unless the board determines that there is “good cause” to do so. An existing dealer has a right to protest a relocation, but it is the manufacturer that has the burden to establish good cause for such a move. R.C. 4517.57(C) and 4517.65(D). R.C. 4517.51 provides a list of factors that the board is to take into consideration when determining whether good cause has been established to- relocate an existing new motor vehicle dealership. The list, which is not exclusive, is as follows:

“(A) The effect of an additional or relocated dealer upon the existing new motor vehicle dealer of the same line-make in the relevant market area to be served by the additional franchisee or relocated dealer;
“(B) Whether it is injurious or beneficial to the public interest for the dealer to be established or relocated;
“(C) Whether the franchisees of the same line-make in the relevant market area are:
“(1) Providing adequate competition and convenient consumer care for the motor vehicles of the same line-make in the relevant market area, which shall include the adequacy of motor vehicle sales and service facilities, equipment, supply of vehicle parts, and qualified sales and service personnel;
“(2) Providing adequate market penetration and representation.
“(D) Whether the franchisor has complied with the requirements of this chapter.”

In applying this standard, the hearing examiner made a number of factual determinations. He found that five Chevrolet dealers currently serve the relevant market area (“RMA”): Bass, Jackshaw, Lally, LaRiche, and O’Brien. Four dealers originally protested the relocation, but three of the four withdrew their protest prior to the hearing, leaving O’Brien as the sole protestant. The current Bass dealership is located on a four-lane roadway with a median strip, across from Thistledown Racetrack. Bass is located next to a Volkswagen/Subaru dealership and is within sight of Randall Park Mall, the largest shopping mall in *476 the area. The hearing examiner took judicial notice of the fact that there have been widely reported public disturbances at the mall. Richard Bass testified that he was concerned that a negative perception of the area surrounding the current dealership has resulted in lost sales and will result in lost sales in the future.

In furtherance of its “Project 2000” plan, Chevrolet approached Bass about relocating his dealership. Edward K. Roggenkamp, Executive Director of Dealer Network Development, North American Operations for General Motors, testified that the Project 2000 plan was based upon numerous demographic and economic criteria aimed at improving location for both the dealers and the public. To induce Bass to relocate, Chevrolet offered him a substantial loan, loan forgiveness guarantees, and a substantial number of additional new vehicles for sale at the proposed new location.

Bass plans to invest in excess of $4 million in the new location. Bass plans to hire over twenty new employees, and to use the old facility as a wholesale parts warehouse, car rental operation, body shop, and used car lot. The current facility, however, is larger than the proposed facility, consists of more land and building square footage, and can accommodate more new and used cars on site than the proposed facility.

With respect to market penetration, the hearing examiner found that Chevrolet’s penetration rate nationally, in the state of Ohio, and in the Cleveland area • has declined in comparison to competitors. Chevrolet’s penetration rates in both Bass and O’Brien’s Area of Geographic Sales and Service Advantage (“AGSSA”) are below Chevrolet’s expectations and substantially below average RMA penetration rates. However, Chevrolet’s expected and actual penetration in the Cleveland RMA compared favorably to those in the Cincinnati and Columbus Multiple Dealer Area (“MDA”). 2 In 1993, Chevrolet’s sales performance in the RMA mirrored the Cleveland MDA performance. Also, in the first nine months of 1994, the RMA performed slightly better than the MDA.

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Bluebook (online)
693 N.E.2d 317, 118 Ohio App. 3d 470, Counsel Stack Legal Research, https://law.counselstack.com/opinion/general-motors-corp-v-joe-obrien-chevrolet-inc-ohioctapp-1997.