State ex rel. New Wen, Inc. v. Marchbanks (Slip Opinion)

[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as State
ex rel. New Wen, Inc. v. Marchbanks, Slip Opinion No. 2020-Ohio-4865.]




                                           NOTICE
      This slip opinion is subject to formal revision before it is published in an
      advance sheet of the Ohio Official Reports. Readers are requested to
      promptly notify the Reporter of Decisions, Supreme Court of Ohio, 65
      South Front Street, Columbus, Ohio 43215, of any typographical or other
      formal errors in the opinion, in order that corrections may be made before
      the opinion is published.



                          SLIP OPINION NO. 2020-OHIO-4865
 THE STATE EX REL. NEW WEN, INC., D.B.A. WENDY’S v. MARCHBANKS, DIR.,
                                            ET AL.

  [Until this opinion appears in the Ohio Official Reports advance sheets, it
 may be cited as State ex rel. New Wen, Inc. v. Marchbanks, Slip Opinion No.
                                     2020-Ohio-4865.]
Application for attorney fees and costs—A prevailing party in an action is not
        permitted to recover attorney fees when attorney fees have not been
        statutorily authorized—Application for attorney fees and costs denied.
     (No. 2017-0813—Submitted June 16, 2020—Decided October 14, 2020.)
                                       IN MANDAMUS.
                                   __________________
        Per Curiam.
        {¶ 1} On January 15, 2020, this court granted a writ of mandamus directing
respondents, the Ohio Department of Transportation and its director, Jack
Marchbanks (collectively, “ODOT”), to commence appropriation proceedings for
a taking of real property. 159 Ohio St.3d 15, 2020-Ohio-63, 146 N.E.3d 545, ¶ 1,
                             SUPREME COURT OF OHIO




30. Relator, New Wen, Inc., d.b.a. Wendy’s, has filed an application for an award
of reasonable attorney fees and costs. Because attorney fees are not available in
this type of action, we deny the application.
                                  I. Background
       {¶ 2} This case arises from ODOT’s closure of the intersection of Cherry
Valley Road and State Route 16 (“S.R. 16”) in Licking County. Vehicles traveling
on S.R. 16 can no longer exit onto Cherry Valley Road in any direction, and
vehicles on Cherry Valley Road can no longer directly access S.R. 16. Id. at ¶ 5.
       {¶ 3} New Wen owns the property on the northwest corner of the former
intersection and operates a Wendy’s restaurant there. Id. at ¶ 4. We held that New
Wen had shown, by clear and convincing evidence, that the closure deprived New
Wen of its property—the right of access to and from S.R. 16—without
compensation. Id. at ¶ 30. We therefore granted a writ of mandamus to compel
ODOT to conduct appropriation proceedings to determine the appropriate amount
of compensation it should pay to New Wen. Id.
       {¶ 4} On February 12, 2020, New Wen filed an application for attorney fees
and other costs. ODOT opposes the application, arguing both that New Wen is not
entitled to recover attorney fees as a matter of law and that the amount of fees
claimed by New Wen is unreasonable.
                                 II. Legal analysis
                                  A. Attorney fees
       {¶ 5} Ohio follows the “American rule,” which “does not permit the
prevailing party to recover attorney fees, in the absence of statutory authorization,
as part of the costs of litigation.” Sorin v. Warrensville Hts. School Dist. Bd. of
Edn., 46 Ohio St.2d 177, 179, 347 N.E.2d 527 (1976). New Wen cites several
possible bases for its recovery of attorney fees.
       {¶ 6} First, New Wen invokes certain provisions of the Uniform Relocation
Assistance and Real Property Acquisition Policies Act of 1970. In particular, New




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                                     January Term, 2020




Wen relies on Subchapter III of that act, titled, “Uniform Real Property Acquisition
Policy,” 42 U.S.C. 4651 et seq., which establishes policies to guide federal land-
acquisition practices. When a federal agency institutes a condemnation proceeding
in federal court, the act authorizes the court to award “reasonable costs,
disbursements, and expenses” to the real property owner, including reasonable
attorney fees, if the federal agency cannot acquire the property by condemnation or
abandons the proceeding. 42 U.S.C. 4654(a)(1) and (2). And under 42 U.S.C.
4654(c), a similar award is authorized for a plaintiff who prevails in an inverse-
condemnation proceeding against the United States for the taking of property by a
federal agency or for a plaintiff in such a proceeding that ends in a settlement; see
also 49 C.F.R. 24.107. By their terms, however, these provisions apply only to
exercises of eminent domain by federal agencies. The federal act does not create a
statutory basis for an award of attorney fees in a state mandamus action.
        {¶ 7} New Wen argues that the federal act applies because ODOT’s
highway project involved the disbursement of federal funds. Before a federal
agency head may approve a project or a contract with an “acquiring agency”1 that
will involve the expenditure of federal funds and the acquisition of real property,
the acquiring agency must give “satisfactory assurances” that “property owners will
be paid or reimbursed for necessary expenses as specified in” 42 U.S.C. 4654. 42
U.S.C. 4655(a)(2). Those “necessary expenses” specified in 42 U.S.C. 4654
include reasonable attorney fees.            Thus, according to New Wen, ODOT is
responsible for paying attorney fees to a prevailing party such as New Wen in an
inverse-condemnation action.           But 42 U.S.C. 4655(a)(2), by its plain terms,
imposes an obligation upon federal officials to ensure certain conditions are met




1. An “acquiring agency” includes a state agency that has the authority under state law to acquire
property by eminent domain. 42 U.S.C. 4655(b)(1); see also R.C. 163.51(J)(1) (same definition).
The director of ODOT has statutory authority to appropriate real property. R.C. 163.02(B).




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                              SUPREME COURT OF OHIO




before approving contracts. It does not purport to be a statutory authorization for
this court to award attorney fees in a mandamus action.
       {¶ 8} Alternatively, New Wen argues that Ohio has expressly adopted the
federal act’s attorney-fee provisions. It is true that some provisions of the federal
act have been expressly incorporated into the Revised Code. For example, R.C.
163.59(J) provides that “[n]o head of an acquiring agency shall intentionally make
it necessary for an owner to institute legal proceedings to prove the fact of the taking
of the owner’s real property.” And it is also true that R.C. Chapter 163, which
governs appropriations of real property, authorizes attorney-fee awards in certain
situations. Thus, if the judge in an appropriation action filed under R.C. 163.05
finds in favor of the property owner on either the question whether the appropriation
is necessary or whether it serves a public purpose, the court shall award attorney
fees. R.C. 163.09(G). Likewise, attorney fees shall be awarded when an agency
abandons its appropriation action, R.C. 163.21(A)(2)(b), or when the owner
prevails in the appropriation proceeding and the appropriation does not occur, R.C.
163.21(B)(1)(b); see also R.C. 163.62(A). But the Revised Code contains no
counterpart to 42 U.S.C. 4654(c) or 49 C.F.R. 24.107 authorizing an award of
attorney fees in a mandamus action brought to compel an appropriation proceeding,
and New Wen does not rely on any Ohio statute in its application for an award of
attorney fees.
       {¶ 9} Instead, New Wen turns to Ohio Adm.Code 5501:2-5-06(G)(3),
which adopts 49 C.F.R. 24.107(c)’s language regarding attorney fees in inverse-
condemnation proceedings. An administrative body may promulgate regulations
only if they are consistent with and predicated upon a statutory grant of authority.
See Burger Brewing Co. v. Thomas, 42 Ohio St.2d 377, 379, 329 N.E.2d 693
(1975); Doyle v. Ohio Bur. of Motor Vehicles, 51 Ohio St.3d 46, 554 N.E.2d 97
(1990), paragraph one of the syllabus. And a party cannot generally recover
attorney fees unless a statute expressly authorizes the fees. Sorin, 46 Ohio St.2d at




                                           4
                                January Term, 2020




179, 180, 347 N.E.2d 527; State ex rel. Murphy v. Indus. Comm., 61 Ohio St.2d
312, 313, 401 N.E.2d 923 (1980). As a result, a fee-shifting provision in an
administrative-code provision that lacks statutory authorization is ineffective. See
Vance v. Roedersheimer, 64 Ohio St.3d 552, 556, 597 N.E.2d 153 (1992) (holding
that a local court rule does not constitute “statutory authorization” for an award of
attorney fees).
        {¶ 10} The Ohio Department of Transportation promulgated Ohio
Adm.Code 5501:2-5-06(G)(3) pursuant to R.C. 163.58. No provision of R.C.
163.58 allows a property owner who initiates an inverse-condemnation proceeding
to recover attorney fees or authorizes an agency to promulgate a rule that provides
for those fees. R.C. 163.62, one of the statutes referred to in R.C. 163.58, does
provide for an award of attorney fees—but in a different context. It allows a court
to award attorney fees in a condemnation proceeding that is “instituted by a state
agency.” R.C. 163.62(A). Because a party cannot generally recover attorney fees
unless a statute expressly authorizes the fees, Sorin at 180, we cannot interpret R.C.
163.58 and 163.62(A) broadly to award attorney fees in an inverse-condemnation
proceeding. The Ohio Administrative Code does not support an award of attorney
fees in this case.
        {¶ 11} Lastly, New Wen claims it is entitled to attorney fees under 42
U.S.C. 1988 because it is “the prevailing party in a case involving federal
constitutional violations” under 42 U.S.C. 1983 (“Section 1983”). Section 1983
creates a cause of action against any person who, acting under color of state law,
deprives another party of a constitutionally guaranteed federal right. See Conley v.
Shearer, 64 Ohio St.3d 284, 292, 595 N.E.2d 862 (1992); Arsan v. Keller, 784
Fed.Appx. 900, 916 (6th Cir.2019). A party who prevails in a lawsuit to enforce a
provision of Section 1983 may recover, at the court’s discretion, reasonable
attorney fees as part of the costs of the action. 42 U.S.C. 1988(b).




                                          5
                                  SUPREME COURT OF OHIO




           {¶ 12} New Wen’s complaint for a writ of mandamus alleged that ODOT’s
actions constituted a taking that infringed both state and federal constitutional
property rights. Specifically, New Wen’s complaint repeatedly asserted rights
under the Fifth and Fourteenth Amendments to the U.S. Constitution and invoked
Section 1983 as one basis for its action (along with claims based on state-law
rights).
           {¶ 13} But despite New Wen’s invocation of the federal statute in its
complaint,2 we cannot regard its mandamus action as a case arising under Section
1983, because this court does not have original jurisdiction to hear a Section 1983
action. It is well established that “ ‘neither the Civil Rules nor statutes can expand
this court’s original jurisdiction and require it to hear an action not authorized by
the Ohio Constitution.’ ” ProgressOhio.org, Inc. v. Kasich, 129 Ohio St.3d 449,
2011-Ohio-4101, 953 N.E.2d 329, ¶ 4, quoting State ex rel. Cleveland Mun. Court
v. Cleveland City Council, 34 Ohio St.2d 120, 122, 296 N.E.2d 544 (1973). Simply
put, Section 1983 cannot (and does not) enlarge the original jurisdiction of this
court. Because this court has no original jurisdiction to hear a Section 1983 claim,
New Wen is not entitled to attorney fees under 42 U.S.C. 1988 as a “prevailing
party” on such a claim.
                                         B. Court costs
           {¶ 14} New Wen also seeks an award of expert-witness costs in the amount
of $9,299.95.       We deny this request because it is based entirely on federal
provisions, 42 U.S.C. 4654 and 49 C.F.R. 24.107, that New Wen has not established
are applicable to this case.




2. Notably, this court’s opinion granting a writ of mandamus did not mention 42 U.S.C. 1983 and
that statute played no role in this court’s decision. See 159 Ohio St.3d 15, 2020-Ohio-63, 146 N.E.3d
545.




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                                January Term, 2020




                                  III. Conclusion
       {¶ 15} We deny the application for an award of attorney fees and expert-
witness costs.     Given this disposition, it is unnecessary to address the
reasonableness of the amounts claimed in New Wen’s application.
                                                                 Application denied.
       O’CONNOR, C.J., and KENNEDY, FRENCH, DEWINE, DONNELLY, and
STEWART, JJ., concur.
       FISCHER, J., concurs, with an opinion joined by DEWINE, J.
                                _________________
       FISCHER, J., concurring.
       {¶ 16} I concur with the majority opinion.
       {¶ 17} I write separately to point out that the General Assembly should
examine the issue whether a property owner in Ohio who is forced to file a lawsuit,
in this case for a writ of mandamus, to get a court order when the state has taken
that owner’s property without filing a proper appropriation case, should or should
not be entitled to an award of attorney fees. As reflected in the majority opinion,
the legislative branch has created other exceptions to the “American Rule” (which
generally does not permit the recovery of attorney fees by a prevailing party) under
many similar circumstances but not under this specific circumstance. There may
be reasons for this situation, but more likely the legislative branch never considered
this specific issue, at least as far as I can determine from my research.
       {¶ 18} I believe that legislators should specifically at least consider whether
Ohioans, or any Americans for that matter, who have had property improperly taken
by any government—and who must go to court to correct that problem caused by
the government—should be entitled to their attorney fees, which they incurred to
uphold their constitutionally protected property rights.




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                             SUPREME COURT OF OHIO




       {¶ 19} Again, I concur. The majority opinion is correct. The General
Assembly should determine if it wants the same result to be reached in future cases
of this type. Making that determination is not this court’s duty.
       DEWINE, J., concurs in the foregoing opinion.
                               _________________
       Vorys, Sater, Seymour & Pease, L.L.P., Joseph R. Miller, Thomas H.
Fusonie, and Daniel E. Shuey, for relator.
       Dave Yost, Attorney General, Benjamin M. Flowers, Solicitor General,
Diane R. Brey, Deputy Solicitor General, and L. Martin Cordero and William J.
Cole, Assistant Attorneys General, for respondents.
                               _________________




                                         8
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