Ohio case law

By: Evin Bachelor, Friday, August 09th, 2019

This weekend, as you enjoy your morning cup of coffee and find yourself wondering what’s the news in our court system, look no further than this blog post.  Every now and then there’s a new court opinion related to agricultural law that peaks our interest and makes us want to share a summary of what happened.  This week we read cases about the federal Takings Clause, wind energy, and oil and gas rights.  Here are the stories:

  • A property owner may bring a claim in federal court under the Fifth Amendment when the government has violated the Takings Clause by taking property without just compensation.  This case involved a township ordinance requiring all cemeteries to be held open and accessible to the general public during daylight hours.  A property owner with a small family graveyard was notified that she was violating the ordinance.  The property owner filed suit in state court arguing that the ordinance constituted a taking of her property, but did not seek compensation.  The township responded by saying it would withdraw the notice of violation and not enforce the ordinance against her.  The state court said that the matter was therefore resolved, but the property owner was not satisfied with that decision.  She decided to bring a takings claim in federal court.

Before this decision, there was a roadblock to bringing such claim.  Lower courts had read a previous Supreme Court decision to say that if a state or local government commits a taking, the property owner would first have to seek a remedy through the state’s adverse condemnation procedure before going to federal court.  But in doing so, the property owner would actually not have a chance to bring the claim in federal court because the federal court would have to give full faith and credit to the state court decision.  At first, that seemed like what would happen to the property owner because the state court had decided that the issue was moot since the township had agreed not to enforce the ordinance against her.  But the U.S. Supreme Court cleared the way for the property owner by taking the rare action of overruling its prior precedent.  Knick v. Township of Scott, Pennsylvania, was not an Ohio court case, but rather one that made its way all the way up to the U.S. Supreme Court.  To read the case, click HERE.

The final opinion handed down by the justices is certainly important, but it is also notable for Ohio because the Ohio Farm Bureau Federation (OFBF) submitted an amicus brief in support of the property owner through its legal counsel, Vorys Sater Seymour and Pease, LLP of Columbus.  The brief cited examples in Ohio showing that the Supreme Court’s prior precedent was causing problems for Ohio property owners by limiting their access to federal courts in Fifth Amendment takings claims.  OFBF has noted that this was the first time it had submitted an amicus brief to the U.S. Supreme Court.

  • Ohio Power Siting Board’s approval of new wind-turbine models in facility’s certificate does not constitute an amendment to the certificate for the purposes of triggering current turbine-setback requirements.  In 2014, the Ohio Power Siting Board approved an application by Greenwich Windpark to construct a wind farm in Huron County with up to 25 wind turbines.  In the initial application, all of the wind turbines would have used the same model of turbine.  Just over a year after the application was approved, the wind farm developer applied for an amendment to add three additional models to the approved wind turbine model list, noting that the technology had advanced since its initial application.  Two of the three newer models would be larger than the originally planned model, but would occupy the same locations and would comply with the minimum setback requirements at the time the application was approved. 

The issue involved whether the new setback requirements, which were put in place by the state between the initial approval and the requested change, should apply.  An amendment to a certificate would trigger the current wind turbine setback requirements.  Greenwich Windpark wanted the less restrictive setback requirements in their initial application to still apply to the newer models, but a local group wanted the more restrictive setback requirements to apply.  The Ohio Power Siting Board said that adding the new wind turbine models would not be an amendment, and would not trigger the more restrictive setbacks.  The Ohio Supreme Court sided with the Ohio Power Siting Board, explaining that the Ohio General Assembly wanted the Ohio Power Siting Board to have broad authority to regulate wind turbines.  This case is cited as In re Application of 6011 Greenwich Winkpark, L.L.C., 2019-Ohio-2406, and is available to read on the Ohio Supreme Court’s website HERE.

  • Children claiming to be heirs of reserved oil and gas rights are in privity with previous owners of the interest when connected by an auditor’s deed specifically mentioning those interests.  The issue was whether children claiming their father’s oil and gas interests were blocked by the legal doctrine of issue preclusion from obtaining clear title to their interest when a previous Ohio Dormant Mineral Act (ODMA) lawsuit quieted title to mineral interests underlying their claim.  This preclusion would be possible because the previous owners’ interests formed the basis of the father’s interest.  Even though they were not named in the previous ODMA lawsuit, by virtue of being in privity, or legally connected, to the previous owners, the children would be bound by the previous lawsuit because the ODMA lawsuit cleared the previous owners’ interests along with any interests in their successors and assigns.  Ultimately the court found that because the children stood in their father’s shoes, and his claim would be linked to the previous owners’ claims in the land, the previous ODMA lawsuit binds the children.  This had the effect of eliminating the children’s claims in the oil and gas rights.  This case is cited as Winland v. Christman, 2019-Ohio-2408 (7th Dist.), and is available to read on the Ohio Supreme Court’s website HERE.
By: Evin Bachelor, Wednesday, June 19th, 2019

Have you ever sent an email or text message that seemed perfectly clear to you, but the recipient read it differently than you had intended?  It happens all the time in everyday life.  We know what we mean in our head, but the message we send contains ambiguities.  While we can hopefully fix ambiguities in an email or text message quickly, wills can present a different story. 

Once a person has passed away, fixing an ambiguity in a will is not easy because the best person to ask about intent cannot be called to testify.  Unfortunately, many families learn about the problems posed by ambiguities the hard way.

Take a recent example from Mahoning County.  In April, an Ohio appellate court upheld a probate court’s decision on how to distribute the assets of a Salem area farmer (“the farmer”).  This happened five years after the farmer passed away, and after two appeals of his estate.  He had a will, but it contained an ambiguity that resulted in years of litigation and delayed closure. 

His will made one specific bequest, and the rest of his property would go into a general pot for his named beneficiaries to divide among themselves as they or the executor saw fit.  The specific bequest read, “I give, devise, and bequeath to my brother […], the real estate at […] together with all contents of said real estate, if owned by me at the time of my death.”  The court had no problem with the real estate because the will provided an address; however, what did the will mean by “all contents of said real estate”?

At the time of the farmer’s death, the real estate contained a residence, family heirlooms, valuables, household goods, farm equipment, and vehicles.  The brother argued that the specific bequest included farm equipment and vehicles because of their physical presence on the real estate.  The general beneficiaries disagreed, believing that the bequest applied to pieces of personal property like heirlooms within the house.  Looking only at the will, the probate court agreed with the general beneficiaries.  The brother appealed the decision.

The appellate court viewed “all contents of said real estate” as ambiguous, and sent the case back to the probate court to re-examine the will.  The law generally disfavors testimony about what a decedent intended because the law assumes that the will provides the best evidence of what the decedent wanted.  When a court finds an ambiguity in a will, it may consider evidence beyond the will, such as testimony or other documents; however, the law considers this evidence less authoritative because it is not directly from the decedent.

After the first appeal, the brother and attorney who drafted the farmer’s will testified in probate court about conversations with the farmer before he passed away.  The brother claimed that conversations with his brother about ideas to grow the farm meant that the farm equipment should go to him; however, the attorney claimed that the farmer intended only for the brother to receive family heirlooms within the house.  The court believed the farmer’s attorney, and again decided that the specific bequest did not include the equipment.

For a second time, the brother appealed the probate court’s decision.  This time the appellate court was satisfied with the probate court’s actions and upheld the probate court’s interpretation of the will.  Click HERE to read the court’s opinion, which is cited as Bogar v. Baker, 2019-Ohio-1762 (7th Dist.).

It took the family in the Bogar case five years to have a legal determination of what their loved one meant in his will.  One clause resulted in lots of costly litigation, not to mention the stresses on the family.

No family wants a contentious probate.  Losing a loved one is hard enough without having to go to court to fully litigate the contents of a will.  Fortunately, this is a problem that can be avoided, or at least minimized, with an effective plan. 

Here are some tips to minimize ambiguities in your will:

  • Identify who you want to have specific pieces of your real and personal property.  For personal items such as family heirlooms, antiques, and art, you may leave a directive that names specifically which person receives what items.
  • Read through your will.  Does it make sense to you?  Does it sound like what you want to happen?
  • Consider showing your will to your executor and ask what he or she thinks your will says.  How would the executor carry out your will if you were gone today?  If he or she says something that you did not intend, you can still fix your will to more clearly align it with your wishes.
  • If you are concerned about beneficiaries challenging your will, you can include a no-contest clause that gives the executor final authority to interpret how to distribute your estate and penalize beneficiaries who challenge that distribution.  When included in a will, these clauses often prevent a beneficiary who challenges a will from receiving any property from the estate.

These tips do not guarantee a challenge-free probate process, but can help make your will as clear as possible.  If a question about your intent would still arise, having a couple of witnesses who can attest to your wishes will help the court get as close to your wishes as possible.  However, this requires you to tell each of these people the same thing and in a clear manner.  If you make any changes, you need to communicate that to your confidants.

Stay tuned in the next couple of months for new resources from our team about estate and business transition planning.  Until then, take a moment to review your estate plan!

Posted In: Estate Planning
Tags: Estate Planning, wills, Ohio case law
Comments: 0
By: Evin Bachelor, Friday, April 19th, 2019

Last month a lawsuit about Ohio’s Current Agricultural Use Value (CAUV) calculation showed back up on our radar.  As we explain in another blog post, the state of Ohio uses CAUV to calculate how much tax owners of land devoted exclusively to an agricultural use must pay.  The plaintiffs sought reimbursements from the state by arguing that the state failed to properly calculate CAUV in accordance with Ohio law.  The case was dismissed by the Franklin County Court of Common Pleas, and the 10th District Court of Appeals affirmed that decision as appropriate.  However, that does not necessarily spell the end for these plaintiffs.

What started the lawsuit: good times meant higher taxes

Many farmland owners likely remember what happened around the middle of this decade to property tax assessments under Ohio’s CAUV formula as it was calculated at that time.  In part because Ohio’s CAUV assessment formula takes agricultural commodity prices into account, a couple of strong years for crop prices contributed to a drastic and generally unanticipated increase in property tax bills for farmers across the state.  Those assessment increases led to a successful effort to change the CAUV formula so that drastic fluctuations would be less likely to occur moving forward.  However, some property owners wanted a reimbursement for previous assessments, not just a new formula.

What the plaintiffs wanted: equitable restitution

The case began on June 26, 2015, when three parties filed a complaint in a county court of common pleas against the state tax commissioner.  The three plaintiffs sought a class action certification to act on behalf of all owners of Ohio lands devoted to agricultural production.  The complaint alleged that the state of Ohio illegally collected more than a billion dollars of property taxes from those owners.  Therefore, the landowners first sought repayment under the legal doctrine of unjust enrichment.

Over the next few months, the plaintiffs amended their complaint twice.  The first amended complaint added a claim for repayment under the doctrine of equitable restitution.  It also added more named plaintiffs, added then-Governor Kasich as a defendant, and asked for compensatory damages.  The second amended complaint removed the Governor and tax commissioner as defendants, added the state of Ohio as a defendant, and removed all claims except for equitable restitution and a declaratory judgment.  Lots of adjustments, but what is equitable restitution?

Equitable restitution is a type of recovery under the law that says one party has improperly benefitted at the expense of another, and therefore should return the benefit to its rightful owner.  Here, the plaintiffs argued that allegedly illegal CAUV collections meant that the state of Ohio had improperly benefitted at the expense of owners of CAUV lands.  Therefore, the state of Ohio should have to return that benefit, which would mean a return of the property tax overpayments.

However, there are two types of restitution under the law: legal and equitable.  Legal restitution is available when a plaintiff cannot assert a right of possession to a particular property but is nonetheless able to shows grounds for compensation from the defendant.  When money is involved, the distinction is largely based upon whether money clearly identifiable as belonging to the plaintiff can be traced to particular funds in the defendant’s possession.  If the money can be traced to particular funds, then equitable restitution is more likely to apply.

For example, say that a plaintiff gave a defendant a five dollar bill, but something goes wrong and the plaintiff wants her money back.  The plaintiff may have an equitable remedy if she seeks the return of that specific five dollar bill.  However, she may only have a legal remedy if she simply wants five dollars back.  This distinction played an important role in the outcome of this case.

Why the case was dismissed: lack of jurisdiction

The lawsuit was ultimately dismissed because the common pleas court determined that it could not hear the case because of the nature of the remedy sought.  Instead, in ruling on the state’s motion to dismiss, the common pleas court decided, and the appellate court affirmed, that only the Ohio Court of Claims has jurisdiction for this type of case.

The Ohio Court of Claims is a special kind of state court that exists primarily to handle lawsuits against the state of Ohio.  Its existence stems from the idea in the U.S. Constitution’s Eleventh Amendment that states have immunity as sovereigns.  States may choose if and when to be sued; however, most have waived that immunity to some extent.  Ohio chose to partially waive its sovereign immunity in particular types of cases by allowing people to sue it in a special court instead of in a county court of common pleas.

When it created the Ohio Court of Claims, the Ohio General Assembly decided that people seeking relief at law must file their lawsuit with the Ohio Court of Claims, while those seeking equitable relief may file their lawsuit with a county court of common pleas.

Restitution happens to be a type of remedy that can be classified as either legal or equitable in nature.  The focus is not on what the parties call the restitution they seek, but what they actually want from it.  In this case, it was not enough that the plaintiffs called what they wanted “equitable restitution.”  The court only cared about what the plaintiffs actually sought.

In looking at the facts, the court determined that the plaintiffs sought the return of funds that could not be traceable into any state account, and therefore the remedy sought was legal in nature.  The court explained that Ohio’s property taxes are collected and held at the county level, and there was no evidence that the CAUV property tax collected by the counties ever made it to the state.  Absent this transfer, the specific tax dollars that the plaintiffs allege were wrongfully paid to the state were not traceable to any state accounts.  Without this traceable link, the plaintiffs could only seek a return of money in general, rather than the return of specific funds.  Because of this, only the Ohio Court of Claims could hear this case and award this remedy.

It was on the basis of this distinction that the Franklin County Court of Common Pleas dismissed the case, and that the Tenth District Court of Appeals affirmed the dismissal.

What are the plaintiffs’ next steps: Ohio Court of Claims or the end?

The trial court dismissed the case “without prejudice,” meaning that the parties are not barred from filing the case again in a proper court.  This can be common when the case is dismissed on a procedural basis where there could be a claim with some merit that has neither been decided on the merits nor settled.  At this time, it does not appear that the plaintiffs have refiled the case in the Ohio Court of Claims, and we cannot predict whether or not they will do so.

The case is cited as Vance v. State, 2019-Ohio-1027 (10th Dist.), and the opinion is available on the Ohio Supreme Court’s website HERE.

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