Greene County Agricultural Society v. Liming

733 N.E.2d 1141, 89 Ohio St. 3d 551

• Court: Ohio Supreme Court
• Decided: September 6, 2000
• Docket: No. 99-1755
• Status: Published

Opinions

Alice Robie Resnick, J.

The sole issue presented for review is whether the Society is entitled to immunity under R.C. Chapter 2744, so that summary judgment was appropriate as a matter of law.³ In the circumstances of this case, this issue has two components: (1) Is the Society a political subdivision for purposes of R.C. Chapter 2744? and (2) If the answer to the first question is yes, was the Society engaged in a governmental function in performing the actions at issue? For the reasons that follow, we find that the Society is not immune from suit, and accordingly reverse the judgment of the court of appeals.

I

Since R.C. Chapter 2744 deals with Political Subdivision Tort Liability, the first question we must answer is whether the Society, as a county agricultural society, is a “political subdivision.” If, as appellants contend, the Society is not a political subdivision, then R.C. Chapter 2744 does not apply to it, it is not immune from suit for that reason, and our inquiry is at an end. If, on the other hand, the Society is a political subdivision, then we must further consider, as the second component of our inquiry, how other provisions of R.C. Chapter 2744 apply to this case.

R.C. 2744.01(F) defines a “political subdivision” as “a municipal corporation, township, county, school district, or other body corporate and politic responsible for governmental activities in a geographic area smaller than that of the state.” R.C. 2744.01(F) then goes on to set forth a nonexhaustive list of particular bodies that fall within the above definition. Co.unty agricultural societies are not specifically mentioned in the statute.

Since the Society does not fall within any of the other groups listed in R.C. 2744.01(F), for it to be a political subdivision it must be a “body corporate and politic responsible for governmental activities.” It is clear that a county agricultural society exists “in a geographic area smaller than that of the state,” so that statutory requirement is easily met.

R.C. Chapter 1711 provides for the establishment, organization, and functioning of county agricultural societies. R.C. 1711.13 explicitly provides that “[c]ounty agricultural societies are hereby declared bodies corporate and politic.” Therefore, if county agricultural societies are “responsible for governmental activities,” then all requirements of R.C. 2744.01(F) are met to qualify the Society for status as a political subdivision.

Black’s Law Dictionary (7 Ed.1999) 167, defines “body politic” as “[a] group of people regarded in a political (rather than private) sense and organized under a single governmental authority.”

This exact issue of whether a county agricultural society is a political subdivision as contemplated in R.C. 2744.01(F) was considered by the Attorney General of Ohio in 1988 Ohio Atty.Gen.Ops. No. 88-034. . The issue arose in the context of considering whether a county agricultural society was a political subdivision that could establish and maintain a self-insurance program under R.C. 2744.08(A)(2)(a) to cover tort liability claims against it and whether a county agricultural society was a political subdivision that could join with other political subdivisions in establishing and maintaining a joint self-insurance pool under R.C. 2744.081(A) to pay tort judgments, settlements, and the like relating to acts or omissions of the political subdivision or its employees. In order to undertake those actions, a county agricultural society first had to qualify as a political subdivision pursuant to R.C. 2744.01(F).

In that opinion, the Attorney General determined that a county agricultural society is a political subdivision and so could undertake the insurance actions at issue relating to tort claims against it. Similarly to the framework of the discussion we have set out above, the Attorney General stated that the only requirement of R.C. 2744.01(F) that required a “detailed analysis” was whether a county agricultural society is responsible for governmental activities.

The Attorney General acknowledged that “[cjertainly, county agricultural societies possess some characteristics that suggest that their activities are not governmental.” However, the Attorney General nevertheless concluded that county agricultural societies are responsible for’ governmental activities, and therefore are political subdivisions under R.C. 2744.01(F).

The Attorney General reasoned that “the primary purpose of county agricultural societies has repeatedly been identified as education.” The Attorney General quoted from State ex rel. Leaverton v. Kerns (1922), 104 Ohio St. 550, 554-555, 136 N.E. 217, 218: “[A]n agricultural fair is * * * a public institution designed for public instruction, the advancement of learning and the dissemination of useful knowledge.” The Attorney General also pointed out that under R.C. 1711.10, the Director of Agriculture may withhold funds for a particular county agricultural society if it is shown that the fair put on by that agricultural society was not of sufficient educational value to justify the expenditure of those funds. The Attorney General further pointed out that “the promotion of educational goals traditionally has been regarded as an appropriate governmental activity,” citing as support for that statement Tilton v. Richardson (1971), 403 U.S. 672, 91 S.Ct. 2091, 29 L.Ed.2d 790; Hadley v. Junior College Dist. of Kansas City (1970), 397 U.S. 50, 90 S.Ct. 791, 25 L.Ed.2d 45; Green v. Thomas (1930), 37 Ohio App. 489, 175 N.E. 226; and Meyer v. Cleveland (1930), 35 Ohio App. 20, 171 N.E. 606.

We are in agreement with the court of appeals that appellants’ arguments based on Hamilton Cty. Bd. of Mental Retardation & Developmental Disabilities v. Professionals Guild of Ohio (1989), 46 Ohio St.3d 147, 545 N.E.2d 1260, are not on point. The issue in that case was whether the county board was a “person” for purposes of R.C. 119.01(F) who could appeal a decision of the State Employment Relations Board. The issue was not whether the county board was a political subdivision.

We see no reason to disagree with the conclusion reached by the Attorney General in 1988 Ohio Atty.Gen.Ops. No. 88-034 on this point, the first component of our inquiry.⁴ We hold that a county agricultural society is a political subdivision pursuant to R.C. 2744.01(F). We thus agree with the decision of the court of appeals upholding the ruling of the trial court on this question.

II

Having found that the Society is a political subdivision, we must ask, as the next component of our inquiry, whether the Society is entitled to immunity under the provisions of R.C. Chapter 2744.

R.C. Chapter 2744 sets out the method of analysis, which can be viewed as involving three tiers, for determining a political subdivision’s immunity from liability. First, R.C. 2744.02(A)(1) sets out a general rule that political subdivisions are not liable in damages. In setting out this rule, R.C. 2744.02(A)(1) classifies the functions of political subdivisions into governmental and proprietary functions and states that the general rule of immunity is not absolute, but is limited by the provisions of R.C. 2744.02(B), which details when a political subdivision is not immune. Thus, the relevant point of analysis (the second tier) then becomes whether any of the exceptions in R.C. 2744.02(B) apply. Furthermore, if any of R.C. 2744.02(B)’s exceptions are found to apply, a consideration of the application of R.C. 2744.03 becomes relevant, as the third tier of analysis.⁵ See Cater v. Cleveland (1998), 83 Ohio St.3d 24, 28, 697 N.E.2d 610, 614-615. See, also, Harp v. Cleveland Hts. (2000), 87 Ohio St.3d 506, 509, 721 N.E.2d 1020, 1023; Hill v. Urbana (1997), 79 Ohio St.3d 130, 133, 679 N.E.2d 1109, 1112.

The exception in R.C. 2744.02(B) implicated by this case that potentially defeats the Society’s immunity under the analysis discussed above is R.C. 2744.02(B)(2), which provides that political subdivisions are liable for “negligent performance of acts by their employees with respect to proprietary functions.” Appellants claim that the Society was engaged in proprietary functions when. it conducted the hog show and the investigation of the alleged Big Fat incident at issue, so that the Society is not immune, and the judgment of the court of appeals should be reversed. Appellees, on the other hand, claim that the Society engaged in governmental functions. If appellees are correct, then R.C. 2744.02(B)(2)’s exception to immunity does not apply, R.C. 2744.02(A)(l)’s general rule of immunity is not defeated, and we must affirm the judgment of the court of appeals.

The mutually exclusive definitions of “governmental function” and “proprietary function” are set out in R.C. 2744.01. R.C. 2744.01(C)(2) lists specific functions expressly designated as governmental functions, and R.C. 2744.01(G)(2) lists specific functions that are expressly designated as proprietary functions. The activities of the Society at issue in the present case do not fall within either R.C. 2744.01(C)(2) or 2744.01(G)(2). Therefore, to classify the Society’s activities, we look to R.C. 2744.01(C)(l)’s definition of “governmental function,” which we set out below. See, also, R.C. 2744.01(G)(1)(b), which for our inquiry here defines a “proprietary function” as a function that “promotes or preserves the public peace, health, safety, or welfare and that involves activities that are customarily engaged in by nongovernmental persons.”

R.C. 2744.01(C)(1) provides that a governmental function is one that satisfies any of the following tests:

“(a) A function that is imposed upon the state as an obligation of sovereignty and that is performed by a political subdivision voluntarily or pursuant to legislative requirement;

“(b) A function that is for the common good of all citizens of the state;

“(c) A function that promotes or preserves the public peace, health, safety or welfare [and] that involves activities that are not engaged in or not customarily engaged in by nongovernmental persons * *

R.C. Chapter 2744 was the General Assembly’s response to judicial abolishment of the doctrine of sovereign immunity. See Franks v. Lopez (1994), 69 Ohio St 3d 345, 347, 632 N.E.2d 502, 504. In making the distinction between governmental functions and proprietary functions a key component of R.C. Chapter 2744 when it was enacted in 1985, the General Assembly has chosen to embrace a concept that was developed through the case law of this court prior to the adoption of that chapter, even though the concept has been criticized by numerous judges and commentators.⁶ See Comment, The Ohio Political Subdivision Tort Liability Act: A Legislative Response to the Judicial Abolishment of Sovereign Immunity (1986), 55 U.Cin.L.Rev. 501, 505-507, 510-521. Those earlier cases can be instructive in illustrating the rationale behind the distinction.

For example, in Wooster v. Arbenz (1927), 116 Ohio St. 281, 284-285, 156 N.E. 210, 211-212, a case considering the immunity of a municipality, this court stated:

“In performing those duties which are imposed upon the state as obligations of sovereignty, such as protection from crime, or fires, or contagion, or preserving, the peace and health of citizens and protecting their property, * * * the function is governmental, and if the municipality undertakes the performance of those functions, whether voluntarily or by legislative imposition, the municipality becomes an arm of sovereignty and a governmental agency and is entitled to * * * immunity * * *. If, on the other hand, there is no obligation on the part of the municipality to perform them, but it does in fact do so for the comfort and convenience of its citizens * * * and the city has an election whether to do or omit to do those acts, the function is private and proprietary.

“Another familiar test is whether the act is for the common good of all the people of the state, or whether it relates to special corporate benefit or profit.”

The Wooster court expounded that “[i]f the function being .exercised is proprietary and in pursuit of private and corporate duties, for the particular benefit of the [municipal] corporation and its inhabitants, as distinguished from those things in which the whole state has an interest, the city is liable.” 116 Ohio St. at 284, 156 N.E. at 211.

When a political subdivision’s acts go beyond governmental functions (and when it acts in a proprietary nature) there is little justification for affording immunity to that political subdivision. “Having entered into activities ordinarily reserved to the field of private enterprise, a [political subdivision] should be held to the same responsibilities and liabilities as are private citizens.” Schenkolewski v. Cleveland Metroparks Sys. (1981), 67 Ohio St.2d 31, 37, 21 O.O.3d 19, 24, 426 N.E.2d 784, 788.

With the above considerations in mind, we consider the application of R.C. 2744.01(C)(1).

We summarily agree with the court of appeals’ determination that the Society’s activities implicated in this ease do not fall within R.C. 274401(C)(1)(a). The functions at issue clearly are not ones “imposed upon the state as an obligation of sovereignty.”

As to R.C. 2744.01(C)(1)(b), the trial court based its decision finding the Society immune on this provision, determining that the Society’s activities at issue here were “for the common good of all citizens of the state.” The court of appeals expressed reservations about the trial court’s conclusion in this regard, but declined to definitively rule on the propriety of the trial court’s determination, because the court of appeals affirmed the trial court’s ruling on other grounds.

We specifically find that the Society’s activities do not fall within R.C. 2744.01(C)(1)(b). We agree with the concern voiced by the court of appeals that the trial court’s definition of what is for the common good of all citizens of the state is too broad because it would subsume the definition of a governmental function found in R.C. 2744.01(C)(1)(c). As aptly stated by the court of appeals, “Any activity that promotes or preserves the public peace, health, safety, and welfare would also fall within a broad definition of what is for the common good of all citizens of the state, thus obscuring the legislature’s purpose in crafting a distinction between activities engaged in or customarily engaged in by nongov-ernment persons and those that are not. See R.C. 2744.01(C)(1)(c) and (G)(1)(b).” When an appropriately narrow definition of “for the common good of all citizens” is applied, the Society’s activities do not fall within R.C. 2744.01(C)(1)(b). The activities at issue benefit only some of the citizens of the state, not all citizens.

The pivotal provision to construe in determining whether the Society engaged in governmental or proprietary functions is R.C. 2744.01(C)(1)(c). The court of appeals concluded that the Society’s activities at issue fall within R.C. 2744.01(C)(l)(c)’s definition of a “governmental function.” In reaching this conclusion, the court of appeals reasoned that a county fair promotes the public welfare by educating the public about agriculture and other matters, and further reasoned that a livestock competition is an activity not engaged in or not customarily engaged in by nongovernmental persons.

As we acknowledged above in considering whether the Society is a political subdivision, there is an educational component to the Society’s activities. See Leaverton, 104 Ohio St. at 554-555, 136 N.E. at 218. This educational component may perhaps be sufficient to support a finding that the activities at issue promote the public welfare. However, R.C. 2744.01(C)(1)(c) is phrased in the conjunctive, so that the obvious question that must be decided is whether the Society’s activities at issue can be classified as governmental functions because they involve “activities that are not engaged in or not customarily engaged in by nongovernmental persons.” R.C. 2744.01(C)(1)(c). See, also, R.C. 2744.01(G)(1)(b) (proprietary function involves “activities that are customarily engaged in by nongovernmental persons”)..

In resolving this question, we must first recognize that a central consideration within the structure of R.C. Chapter 2744 is the premise that some activities of a political subdivision may be governmental functions, while some other activities are not. Thus, the issue here is not whether holding a county fair is a governmental function; rather, it is the more specific question of whether conducting the hog show at the county fair and conducting the investigation into the allegations of irregularity surrounding the entry of Big Fat in that hog show are governmental functions.

It is apparent to us that even though conducting a county fair may be an activity not customarily engaged in by nongovernmental persons, conducting a livestock competition is an activity customarily engaged in by nongovernmental persons. Any organization, whether private or public, can hold a competition of this type. The consideration that many such competitions are conducted within county fairs cannot change the fact that there is nothing inherently governmental about them. In this situation, educational value alone is not enough to convert what otherwise would not be a governmental function into something that is a governmental function. We see no reason to distinguish a livestock competition at a county fair from any other similar competition, such as a livestock competition held elsewhere than at a county fair, or a dog or cat show, or an art show, or a chili cook-off, or a beauty pageant, or a car show.

In a situation such as the present case, when the political subdivision at issue is not one of the bodies specifically mentioned within R.C. 2744.01(F), the exceptions to immunity of R.C. 2744.02(B) should be construed in a way that leads to a finding of immunity for only the central core functions of the political subdivision. If the exceptions in R.C. 2744.02(B) are interpreted too expansively in this situation, the balance of competing interests reflected in the structure of R.C. Chapter 2744 is undermined.

Unlike the court of appeals, we determine that the Society’s activities at issue do not constitute governmental functions, but instead are proprietary functions. We hold that the conducting of a livestock competition at a county fair by a county agricultural society is a proprietary function pursuant to R.C. Chapter 2744. We reverse the judgment of the court of appeals on this issue and remand this cause to the trial court for further proceedings.

Since we have determined that an R.C. 2744.02(B) exception to immunity applies to the circumstances at issue, our analysis has progressed to the point where the “third tier” of consideration set forth in Cater now becomes relevant. As to R.C. 2744.03’s application to the Society’s immunity, we find that none of the defenses of R.C. 2744.03 applies to this case. The nonliability provisions of that statute must be read more narrowly than the liability provisions of R.C. 2744.02(B), or the structure of R.C. Chapter 2744 makes no sense at all. See Hall v. Ft. Frye Loc. School Dist. Bd. of Edn. (1996), 111 Ohio App.3d 690, 699, 676 N.E.2d 1241, 1247; Hallett v. Stow Bd. of Edn. (1993), 89 Ohio App.3d 309, 313, 624 N.E.2d 272, 274; Stuckey v. Lawrence Twp. Bd. of Trustees (Aug. 24, 1992), Stark App. No. 8806, unreported, 1992 WL 214485 (Milligan, J., dissenting).

However, the question of Mangan’s personal liability, and how R.C. 2744.03 applies to that, requires a different analysis than we employ with regard to R.C. 2744.03’s application to the Society. Of course, if we had found that the Society is not a political subdivision, then Mangan could not qualify as an employee of a political subdivision for R.C. Chapter 2744 purposes, and the trial court’s finding that he is immuné from suit under R.C. 2744.03(A)(6) on the claims raised against him individually could not stand. However, since we have found that the Society is a political subdivision pursuant to R.C. 2744.01(F), R.C. 2744.03(A)(6) is relevant to the question of Mangan’s personal liability.

R.C. 2744.03(A) specifies that the defenses and immunities contained within that section may be asserted “in connection with a governmental or proprietary function.” Therefore, regardless of whether the Society engaged in governmental or proprietary functions in conducting the activities at issue, Mangan will be immune in his individual capacity unless his acts satisfy the standards of R.C. 2744.03(A)(6) exposing him to personal liability. See Fabrey v. McDonald Village Police Dept. (1994), 70 Ohio St.3d 351, 356, 639 N.E.2d 31, 35.

The trial court granted summary judgment to Mangan on the issue of his personal immunity, finding that none of the requirements for imposing personal liability on an employee under R.C. 2744.03(A)(6) was met. The trial court specifically found that summary judgment was appropriate because, even if Mangaris conduct may have been negligent, “reasonable minds cannot differ that [his conduct] did not rise to the level of and constitute malice, bad faith, or reckless conduct.”

Appellants, as part of their appeal to the court of appeals, challenged the trial court’s finding that Mangan was entitled to personal immunity under R.C. 2744.03(A)(6). The court of appeals affirmed the judgment of the trial court on this issue, finding that there was no evidence that Mangan acted with ill will, malice, or bad faith in conducting his investigation, that reasonable minds could not differ on whether Mangan acted recklessly in his investigation, and that there was no genuine issue of material fact that any comments Mangan made were outside the scope of his employment or made with ill will or malice.

Because we have found that the Society is not immune, and because this matter is being remanded to the trial court for further proceedings, further facts may emerge regarding the propriety and details of Mangaris actions. Given this scenario, we vacate at this time the trial court’s determination (and the court of appeals’ subsequent affirmance) that Mangan is individually immune. We view the lower courts’ decisions on this issue as premature. We stress that, upon remand, Mangan’s personal immunity is an open question, at this time neither established nor foreclosed. We additionally emphasize that our holding that the Society is not immune is solely on that question of law, and should not be read as having any bearing on the resolution of the merits of the claims of any party.

In conclusion, the judgment of the court of appeals that the Society is immune from suit is reversed, and this cause is remanded to the trial court for further proceedings.

Judgment reversed and cause remanded.

F.E. Sweeney, J., concurs. Douglas and Pfeifer, JJ., concur in the syllabus and judgment. Moyer, C.J., Cook and Lundberg Stratton, JJ., dissent.

3 . We note that appellants do not challenge the constitutionality of any aspect of R.C. Chapter 2744. Therefore, our inquiry is confined solely to interpreting the provisions of the relevant statutes. Furthermore, the decision in Dunn v. Brown Cty. Agricultural Soc. (1888), 46 Ohio St. 93, 18 N.E. 496, relied upon by appellants, predates R.C. Chapter 2744 by nearly one hundred years, and it appears that a county agricultural society was not designated both “a body corporate and politic ” by the statutes in effect at the time governing such societies. (Emphasis added.) See 46 Ohio St. at 97-98,18 N.E. at 498. That the General Assembly has chosen to designate a county agricultural society as a “body politic” in R.C. 1711.13 is an important factor in our decision.

4 . As further support for the Society’s status as a political subdivision, appellees point out that in 1992 Ohio Atty.Gen.Ops. No. 92-078, the Attorney General determined that a county agricultural society’s board of directors is a “public body” pursuant to R.C. 121.22 and is subject to the open meeting requirements of that statute. Although we recognize that a “public body” for purposes of R.C. 121.22 is definitely not coextensive with a “political subdivision” pursuant to R.C. Chapter 2744, and we further note that this opinion of the Attorney General relied on the earlier Attorney General opinion in 1988 Ohio Atty.Gen.Ops. No. 88-034 (which appellants argue was wrongly decided), we agree with appellees that the decision in 1992 Ohio Atty.Gen.Ops. No. 92-078 does provide some additional support for the proposition that the Society is a political subdivision.

5 . At some point, R.C. 2744.05 may also become relevant, as R.C. 2744.02(B) is expressly made subject to that section as well.

6 . See, e.g., Haverlack v. Portage Homes, Inc. (1982), 2 Ohio St.3d 26, 29, 2 OBR 572, 574, 442 N.E.2d 749, 752 (“Attempts to classify municipal functions into these two categories have caused confusion and unpredictability in the law.”); Hack v. Salem (1963), 174 Ohio St. 383, 394, 23 O.O.2d 34, 40, 189 N.E.2d 857, 864 (Gibson, J., concurring in judgment) (attempted distinction between governmental and proprietary functions is a “morass of conflict and confusion,” “has been difficult and frequently leads to absurd and unjust consequences,” and is a “ ‘bramble bush’ * * * which is both faulty and unsuited to modern * * * life”).