St. Lawrence O'Toole Gardens, L.L.C. v. Lawrence Cty. Aud.

2020 Ohio 4320

• Court: Ohio Court of Appeals
• Decided: August 27, 2020
• Docket: 19CA15
• Status: Published

Opinion

[Cite as St. Lawrence O'Toole Gardens, L.L.C. v. Lawrence Cty. Aud., 2020-Ohio-4320.]

IN THE COURT OF APPEALS OF OHIO FOURTH APPELLATE DISTRICT LAWRENCE COUNTY

St. Lawrence O’Toole Gardens, LLC, : Case No. 19CA15

Appellant-Plaintiff/Appellant, :

v. : DECISION AND JUDGMENT ENTRY Lawrence County Auditor, :

Appellee-Defendant/Appellee. : RELEASED 8/27/2020 ______________________________________________________________________ APPEARANCES:

Barry F. Fagel and Christopher H. Hurlburt, Lindhorst & Dreidame, Cincinnati, Ohio, for appellant.

Brigham M. Anderson, Lawrence County Prosecutor, and W. Mack Anderson, Lawrence County Assistant Prosecutor, Ironton, Ohio, for appellee. ______________________________________________________________________ Hess, J.

{¶1} St. Lawrence O’Toole Gardens, LLC (“St. Lawrence”), appeals from a

judgment of the Lawrence County Common Pleas Court that affirmed the value the

Lawrence County Board of Revision (“BOR”) assigned to certain real property for tax

year 2017. St. Lawrence contends that the common pleas court erred by not allowing

the parties to file briefs before it issued its judgment and by upholding the BOR’s value.

Because the court resolved the appeal without giving St. Lawrence an opportunity to

present its arguments relative to the appeal, and because its unreasoned decision

provides us no basis on which to assess its review of the evidence and its conclusions,

we reverse the court’s judgment and remand for further proceedings. This decision

renders moot any further contention that the court abused its discretion when it affirmed Lawrence App. No. 19CA15 2

the value assigned by the BOR, a merits determination the court's conclusory decision

does not leave us in a position to address.

I. FACTS

{¶2} St. Lawrence is the record owner of certain real property in Ironton, Ohio,

where its affiliate, Close to Home III, LLC, operates an assisted-living facility. The

Lawrence County Auditor valued the property at $2,671,120 for tax year 2017. St.

Lawrence filed a complaint in the BOR seeking a reduction in value to $1,250,000.

After three days of hearings, the BOR retained the auditor’s value.

{¶3} On December 26, 2018, St. Lawrence filed a notice of appeal in the

common pleas court asserting that the BOR relied upon an excessive appraisal, that the

“property was valued as a commercial leasing facility and not as a specific low

income/Medicare residential assisted living facility,” and that the value set by the BOR

did not represent the fair market value as of tax year 2017. St. Lawrence stated that it

“submits this appeal on the record before the [BOR] and requests that this matter be set

for trial for the purpose of submitting additional evidence.” On January 25, 2019, the

auditor filed a “response” to the notice of appeal in which it neither admitted or denied

the statements in the notice of appeal, and the auditor filed the record of the BOR’s

proceedings except for the hearing transcripts. Approximately two months later, the

auditor submitted the transcripts. On July 22, 2019, the court issued a judgment entry

stating simply in operative part: “Upon review of the record and evidence thus

submitted, including transcripts from the [BOR] hearings * * * the Court hereby finds the

value of said property to be $2,671,120.00.” Lawrence App. No. 19CA15 3

II. ASSIGNMENT OF ERROR

{¶4} St. Lawrence assigns the following error for our review: “The trial court

erred when it refused to permit the parties’ briefing on this matter and upheld the

valuation of the Board of Revision.”

III. LAW AND ANALYSIS

{¶5} In its sole assignment of error, St. Lawrence contends that the common

pleas court erred when it resolved the appeal without permitting the parties to file briefs

and when it upheld the value assigned by the BOR. St. Lawrence relies on RDSOR v.

Knox Cty. Aud., 5th Dist. Knox No. 07-CA-12, 2008-Ohio-897, to support its position

regarding briefs. The auditor contends RDSOR conflicts with our decision in Diversified

Mtge. Investors, Inc. v. Athens Cty. Bd. of Revision, 7 Ohio App.3d 157, 454 N.E.2d

1330 (1982), and notes that we cited Schisler v. Clausing, 66 Ohio St.2d 345, 421

N.E.2d 1291 (1981), and State ex rel. Myers v. Chiaramonte, 46 Ohio St.2d 230, 348

N.E.2d 323 (1976), in support of our decision. The auditor also asserts that neither

party requested that the common pleas court “accept additional evidence or permit

briefing prior to its decision.” St. Lawrence responds that Diversified is inapposite

because it dealt with the obligation of a court to hear and consider additional evidence

under R.C. 5717.05, and St. Lawrence emphasizes that a brief stating a party’s

arguments is not evidence. St. Lawrence also contends that the trial court “simply

adopted” the BOR’s valuation, which the BOR “arrived at via improper means.”

{¶6} In an appeal from a judgment of a common pleas court made pursuant to

R.C. 5717.05, we may not disturb the court’s determination of taxable value “absent a

showing of abuse of discretion.” Black v. Bd. of Revision of Cuyahoga Cty., 16 Ohio Lawrence App. No. 19CA15 4

St.3d 11, 14, 475 N.E.2d 1264 (1985). “Specifically, an appeals court should not

question the trial court’s judgment, unless such determination is unreasonable, arbitrary,

or unconscionable.” Id.

{¶7} R.C. 5717.05 provides that the person in whose name property is listed

may appeal a decision of the county board of revision to the county common pleas court

by filing a notice of appeal with the court and board. “Within thirty days after notice of

appeal to the court has been filed with” the board, it “shall certify to the court a transcript

of the record of the proceedings of said board pertaining to the original complaint and all

evidence offered in connection with that complaint.” R.C. 5717.05. The common pleas

court “may hear the appeal on the record and the evidence thus submitted, or it may

hear and consider additional evidence. It shall determine the taxable value of the

property whose valuation or assessment for taxation by the county board of revision is

complained of * * *.” Id.

{¶8} The Supreme Court of Ohio has stated:

While R.C. 5717.05 requires more than a mere review of the decisions of the board of revision, that review may be properly limited to a comprehensive consideration of existing evidence and, in the court’s discretion, to an examination of additional evidence. The court should consider all such evidence and determine the taxable value through its independent judgment. In effect, R.C. 5717.05 contemplates a decision de novo. It does not, however, provide for an original action or trial de novo.

(Emphasis sic.) Black at 14.

{¶9} In RDSOR, a property owner filed an appeal from a county board of

revision’s determination of value in common pleas court. RDSOR, 5th Dist. Knox No.

07-CA-12, 2008-Ohio-897, at ¶ 4. About six months later, the court issued a decision

reducing the value based on the transcript and evidence from the board’s proceedings. Lawrence App. No. 19CA15 5

Id. at ¶ 5. The county auditor and a local board of education appealed and asserted

that the court had denied their right to due process in deciding the appeal without giving

them an opportunity to submit briefs on the issue presented. Id. at ¶ 6, 10. The Fifth

District Court of Appeals agreed and reversed the lower court’s decision. Id. at ¶ 10,

28. The appellate court explained that while R.C. 5717.05

specifically contemplates the reviewing court’s discretion in allowing the parties to submit “additional evidence”, the filing of a brief stating the party’s argument with regard to their appeal is not “additional evidence” under this provision. Rather, fundamental fairness and the traditional notions of due process provide for an appealing party’s opportunity to be heard through the submission of briefs and/or oral argument. As such, the county auditor was not required to file a motion to request the right to file a brief in the appeal. The court’s hearing of the appeal necessarily contemplates the duty to allow the parties to be heard, and the trial court erred in issuing its decision without providing the parties an opportunity to present their respective arguments relative to the appeal.

Id. at ¶ 26.

{¶10} We agree generally with the reasoning in RDSOR and conclude that in

this case, the common pleas court should have provided the parties an opportunity to

present their arguments relative to the appeal. We think that is what the review statute

and its "decision de novo" requirement of an independent assessment of the evidence

contemplates. But after the common pleas court implicitly exercised its discretion under

R.C. 5717.05 to reject St. Lawrence’s request that it conduct a trial to hear and consider

additional evidence, the court failed to give St. Lawrence an opportunity to present its

arguments in support of the appeal before the court issued a decision. Although St.

Lawrence had the opportunity to file a brief and request oral argument in this court, the

scope of our review of the value assigned by the common pleas court (abuse of

discretion) is more limited than the scope of the common pleas court’s review of the Lawrence App. No. 19CA15 6

BOR’s decision (de novo). See generally Borgerding v. Dayton, 91 Ohio App.3d 96, 98,

101, 631 N.E.2d 1081 (2d Dist.1993) (common pleas court’s error in deciding R.C.

2506.01 “administrative appeal without the benefit of briefs or arguments by either party

on the merits of the appeal” was not cured by fact that party had an opportunity to make

its arguments to the court of appeals because “the scope of review by the trial court in

an administrative appeal is greater than the scope of review by the court of appeals in

an ensuing appeal from the trial court’s judgment”).

{¶11} Our decision in Diversified does not conflict with RDSOR. In Diversified,

the property owner appealed a county auditor’s determination of value to the county

board of revision, which did not change the value. Diversified, 7 Ohio App.3d at 157,

454 N.E.2d 1330. Pursuant to R.C. 5717.05, the owner appealed to the county

common pleas court, which reduced the value based on the transcript of the hearing

before the board and a prior appraisal. Id. at 157-158. The board appealed to this

court, and in its first assignment of error, argued that the common pleas court erred

when it issued a decision “ ‘without holding a hearing or otherwise providing any

opportunity for the parties to present additional evidence.’ ” Id. at 157. The board

argued that a hearing was required under R.C. 2505.05 et seq. Id. at 158. We stated

that “[b]ecause R.C. 5717.05 sets up specific procedures for appeals from the decision

of a taxing agency, we must conclude that the procedures contained in R.C. 5717.05

dictate whether or not a hearing is required.” Id. We held that under the statute, “the

decision as to whether the court may hear and consider additional evidence is a matter

within the sound discretion of the court of common pleas.” Id. We found that the lower

court did not abuse its discretion, noting that the board did not “attempt to request a Lawrence App. No. 19CA15 7

hearing or attempt to seek permission to introduce any new evidence.” Id. at 159. We

did not consider whether a common pleas court denied a party to a R.C. 5717.05

appeal its right to present its arguments on appeal to the court. See State v. Morgan,

4th Dist. Ross No. 12CA3305, 2012-Ohio-3936, ¶ 13 (counsel’s arguments are not

evidence).

{¶12} The auditor’s reliance on Schisler and Chiaramonte is misplaced. The

auditor is correct that we cited those cases in Diversified; however, we did so only for

the principle that a specific law controls over a general one. Diversified at 158. Schisler

and Chiaramonte did not involve appeals pursuant to R.C. 5717.05, and they are not

relevant to this case.

{¶13} In any event, even if the structure of R.C. 5717.05 did not require the

common pleas court to afford parties a chance to present their arguments on appeal,

the court well might choose to do so because it must engage in a reasoned analysis of

the issues. The Supreme Court of Ohio has explained that "the common pleas court

has a duty on appeal to independently weigh and evaluate all evidence properly before

it. The court is then required to make an independent determination concerning the

valuation of the property at issue. The court's review of the evidence should be

thorough and comprehensive, and should ensure that its final determination is more

than a mere rubber stamping of the board of revision's determination." (Emphasis

added.) Black, 16 Ohio St.3d at 13-14, 475 N.E.2d 1264.

{¶14} Here, the court did not specify, let alone analyze in any fashion permitting

meaningful review, any of the arguments advanced to the BOR by any party. Its

decision does not recite any of the evidence adduced, and does not provide the parties, Lawrence App. No. 19CA15 8

or us, with any insight into its reasoning. We understand that the court reviewed "the

record and evidence," July 22, 2019 Judgment Entry, but it did not articulate the

necessary thorough and comprehensive analysis. The valuation review system

requires that the court show its work.

{¶15} In failing to do so, the court abused its discretion. "Because we are

unable to ascertain from a careful review of the trial court's decision that it properly

discharged its duty of independently evaluating [the evidence and the arguments on

value], we must remand the matter to the trial court for further proceedings." Euclid

Realty LLC v. Lake Cty. Aud., 11th Dist. Lake No. 2012-L-027, 2012-Ohio-5332, ¶ 24

(also stating in paragraph nine that the trial court's "entire analysis of the [contested

valuation] issue consisted" of two sentences). See also, e.g., Tall Pines Holdings, Ltd.

v. Testa, 10th Dist. Franklin No. 04AP-372, 2005-Ohio-2963, ¶ 18 ("trial court's analysis

of the evidence should be thorough and comprehensive. This review ensures that a

court's final determination is not a mere rubber stamping of the [BOR's] determination,

but rather an independent investigation and complete reevaluation of a [BOR's] value

determination"); compare Eastbrook Farms, Inc. v. Warren Cty. Bd. of Revision, 194

Ohio App.3d 193, 2011-Ohio-2103, 955 N.E.2d 418, ¶ 21 (12th Dist.) (rejecting

appellant's claim that trial court improperly deferred to the BOR determination because

"[o]ur review of the court's decision reveals that it carefully considered the evidence

presented by the parties").

{¶16} For the foregoing reasons, we sustain the assignment of error to the

extent it asserts the common pleas court erred when it upheld the BOR valuation

without giving St. Lawrence an opportunity to present its arguments relative to the Lawrence App. No. 19CA15 9

appeal and without fulfilling the court’s duty to independently determine the value of the

property. Accordingly, we reverse the judgment of the common pleas court and remand

for further proceedings consistent with this opinion.

JUDGMENT REVERSED AND CAUSE REMANDED. Lawrence App. No. 19CA15 10

JUDGMENT ENTRY

It is ordered that the JUDGMENT IS REVERSED and that the CAUSE IS REMANDED. Appellee shall pay the costs.

The Court finds there were reasonable grounds for this appeal.

It is ordered that a special mandate issue out of this Court directing the Lawrence County Court of Common Pleas to carry this judgment into execution.

Any stay previously granted by this Court is hereby terminated as of the date of this entry.

A certified copy of this entry shall constitute the mandate pursuant to Rule 27 of the Rules of Appellate Procedure.

Smith, P.J. & Nelson, J.*: Concur in Judgment and Opinion.

For the Court

BY: ________________________________ Michael D. Hess, Judge

NOTICE TO COUNSEL

Pursuant to Local Rule No. 14, this document constitutes a final judgment entry and the time period for further appeal commences from the date of filing with the clerk.

*Judge Frederick D. Nelson, Tenth District Court of Appeals, sitting by assignment of the Supreme Court of Ohio in the Fourth Appellate District.