Perrico Property Sys. v. Independence

• Citation: 644 N.E.2d 714,96 Ohio App.3d 134
• Decision Date: 18 July 1994
• Docket Number: No. 65142,65142
• Parties: PERRICO PROPERTY SYSTEMS, Appellant, v. CITY OF INDEPENDENCE et al., Appellees. *
• Court: United States Court of Appeals (Ohio)

Page 134

96 Ohio App.3d 134

644 N.E.2d 714

PERRICO PROPERTY SYSTEMS, Appellant, v. CITY OF INDEPENDENCE et al., Appellees. ^*

No. 65142.

Court of Appeals of Ohio, Eighth District, Cuyahoga County.

Decided July 18, 1994.

Timothy J. Grendell and Debra L. Kackley, Cleveland, for appellant.

Stephen M. O'Bryan, Director of Law, and Kurt D. Weaver, Asst. Director of Law, Cleveland, for appellees.

NUGENT, Judge.

This is an appeal from a final judgment of the Cuyahoga County Court of Common Pleas, which dismissed the complaint for declaratory relief filed by plaintiff-appellant, Perrico Property Systems, against the defendant-appellee, the city of Independence.

On May 7, 1992, appellant filed the instant action, seeking a declaration that the current zoning of its property located in Independence, Ohio, is invalid because such zoning as applied to the property is arbitrary, capricious, unreasonable, confiscatory and unconstitutional and bears no rational relationship to the health, safety, morals or general welfare of the residents of the city. Moreover, appellant sought a declaration that the property, as presently zoned, cannot be used in an economically viable manner.

In appellant's complaint, it is alleged that appellant owns undeveloped real property located adjacent to Interstate Route 77 ("I-77") in the city. The property is currently zoned U-1 single-family residential district, which restricts its use to single-family residential development with lots of at least one hundred foot frontage. Appellant further alleged, and later supported such allegations with an affidavit of Gene Troiano, a principal of Perrico Properties, that because of the difficult terrain and proximity to I-77, the property is economically undeveloped and is unable to be developed for single-family use. Moreover, the property is not economically marketable as currently zoned.

It was further stipulated that on August 9, 1988, city council adopted Ordinance 198-21 for the purpose of rezoning the property from its present zoning to U-1A, Single Family Cluster District. However, said rezoning ordinance was rejected by the voters when it came before them in a referendum as required by the city's charter. Appellant, in its complaint, seeks rezoning to permit a mid-rise, multi-family development which will allow for the economically viable use and development of the property.

On July 10, 1992, the city filed a motion to dismiss appellant's complaint pursuant to Civ.R. 12(B)(6) for failure to state a claim upon which relief can be granted. In its motion, the city argued that appellant's complaint fails to state a claim upon which relief may be granted because (1) no justiciable controversy exists between the parties, since the city has not taken any final action, (2) appellant has failed to exhaust the administrative remedies available to it under the city's code, (3) appellant had prior knowledge of the zoning restrictions on the property at the time of purchase, and (4) appellant does not have standing to come before the court, since appellant does not own all of the property proposed to be developed.

The city supported its motion with evidentiary materials outside the pleadings, which establish that on four separate occasions, appellant appeared before the city's planning commission and presented preliminary subdivision plans for the development of the property in question. Some of the plans in question complied with the city's zoning ordinance, while others did not.

On August 5, 1992, the trial court granted appellant's motion for an extension of time to respond to the city's motion. Additionally, the court noted, in its half-page journal entry, that "[p]er agreement of parties, [the city's] motion to dismiss contains matters outside the pleadings and discovery is necessary to respond."

Thereafter, on November 23, 1992, appellant filed its brief in opposition to appellee's motion to dismiss. Appellant argued that it does not have an available, serviceable remedy which it could exhaust because a city cannot administratively rezone property. Further, appellant argued that exhaustion of administrative remedies is not required for the following reasons: (1) resort to the administrative remedy rule would be futile; (2) the administrative challenge would be onerous and unusually expensive; (3) appellant is challenging the constitutionality of the zoning ordinance; and (4) appellant was not involved in the administrative process. Finally, appellant argued that its prior knowledge of the zoning restrictions is not a bar to its complaint for declaratory relief and that it had standing to sue.

Based on the foregoing arguments, the briefs of counsel and the attached evidentiary materials, the trial court entered a final judgment dismissing appellant's complaint.

Appellant timely appeals, raising the following assignments of error for our review:

"I. The trial court erred in dismissing appellant's complaint for failure to exhaust administrative remedies, when appellant had no available, serviceable administrative remedies which appellant could exhaust.

"II. The trial court erred in dismissing appellant's complaint for failure to exhaust administrative remedies, when exhaustion is not required because the administrative process is not equally as serviceable as a declaratory judgment action and would be onerous or unusually expensive, and would be prohibited by the city charter.

"III. The trial court erred in dismissing appellant's complaint for failure to exhaust administrative remedies, when exhaustion is not required because appellant is challenging the constitutionality of a zoning ordinance.

"IV. The trial court erred in dismissing appellant's complaint for failure to exhaust administrative remedies, when exhaustion is not required because appellant was not involved in the administrative process.

"V. The trial court erred in dismissing appellant's complaint, when appellant's prior knowledge of zoning restrictions is not a bar to appellant's complaint for declaratory judgment.

"VI. The trial court erred in dismissing appellant's complaint when appellant, as the owner of all four properties referred to in appellant's complaint, has standing to bring this action." (Emphasis sic.)

Appellant's assignments of error are interrelated and will, therefore, be considered jointly. Taken together, appellant argues that the trial court committed reversible error in dismissing its complaint for declaratory judgment.

Appellee, initially, filed a motion to dismiss the complaint pursuant to Civ.R. 12(B)(6) for failure to state a claim upon which relief could be granted. However, by agreement of the parties, appellee's motion contained matters outside the pleadings, and discovery was necessary for appellant to respond. Implicitly, appellee's motion was converted into a motion for summary judgment. Civ.R. 12(B); State ex rel. Baran v. Fuerst (1990), 55 Ohio St.3d 94, 563 N.E.2d 713; Applegate v. Fund for Constitutional Govt. (1990), 70 Ohio App.3d 813, 592 N.E.2d 878; Pollock v. Kanter (1990), 68 Ohio App.3d 673, 678, 589 N.E.2d 443, 446.

"The constitutionality of a zoning ordinance may be attacked in two ways. An appeal from an administrative zoning decision can be taken pursuant to R.C. Chapter 2506. In addition, or in the alternative, a declaratory judgment action pursuant to R.C. Chapter 2721 can be pursued." Karches v. Cincinnati (1988), 38 Ohio St.3d 12, 526 N.E.2d 1350, paragraph one of the syllabus; Driscoll v. Austintown Assoc. (1975), 42 Ohio St.2d 263, 71 O.O.2d 247, 328 N.E.2d 395; Std. Oil Co. v. Warrensville Hts. (1976), 48 Ohio App.2d 1, 2 O.O.3d 4, 355 N.E.2d 495. In the present case, appellant chose to pursue an action for declaratory relief, seeking a judgment that the zoning of the instant property is unconstitutional.

R.C. 2721.03 provides, in pertinent part, that "[a]ny person * * * whose rights, status, or other legal relations are affected by a constitutional provision * * * [or] municipal ordinance * * * may have determined any question of construction or validity arising under such * * * constitutional provision * * * [or] ordinance * * * and obtain a declaration of rights, status, or other legal relations thereunder." Moreover, Civ.R. 57 provides that "[t]he procedure for obtaining a declaratory judgment pursuant to Sections 2721.01 to 2721.15, inclusive, of the Revised Code, shall be in accordance with these rules. The existence of another adequate remedy does not preclude a judgment for declaratory relief in cases where it is appropriate * * *."

An action for declaratory relief requires (1) a real controversy between the parties, (2) a controversy which is justiciable in character, and (3) a situation where speedy relief is necessary to preserve the rights of the parties. Williams v. Akron (1978), 54 Ohio St.2d 136, 8 O.O.3d 125, 374 N.E.2d 1378; Rothchild v. Cent. Motors Corp. (Oct. 7, 1993), Cuyahoga App. No. 63743, unreported, 1993 WL 398553. An actual controversy exists when persons aver that their rights, status or other legal relations have been affected by an allegedly invalid ordinance. Karches, supra, 38 Ohio St.3d at 16, 526 N.E.2d at 1355; Pack v. Cleveland (1982), 1 Ohio St.3d 129, 1 OBR 166, 438 N.E.2d 434; Rothchild, supra. Finally, a prerequisite to a determination that an actual controversy exists in a declaratory judgment action is a final decision concerning the application of a zoning regulation to the specific property in question. Karches, supra, paragraph two of the syllabus.

The city argues that appellant has failed to demonstrate the existence of a justiciable controversy between it and the city. The city contends that it has not made a final determination concerning the application of the zoning ordinance to the specific property in question. However, the record adequately refutes this assertion. It was stipulated that on August 9, 1988, the city council adopted an ordinance which...