Court Opinion

ID: 5123049
Source: CourtListenerOpinion
Date Created: 2021-11-03 18:11:44.194228+00
Date Added: 2024-06-11T08:22:31.266153
License: Public Domain

[Cite as Wray v. Albi Holdings, P.L.L., 2021-Ohio-3920.]

                          IN THE COURT OF APPEALS
                 FIRST APPELLATE DISTRICT OF OHIO
                           HAMILTON COUNTY, OHIO

JERRY WRAY, DIRECTOR                    OHIO :             APPEAL NO. C-200381
DEPARTMENT                                OF               TRIAL NO. A-1802752
TRANSPORTATION,                              :

         Plaintiff-Appellee,                      :
                                                             O P I N I O N.
         vs.                                      :

ALBI HOLDINGS, P.L.L,                             :

   and                                            :

BUSINESS                   INFORMATION :
SOLUTIONS, INC.,

         Defendants-Appellants,                   :

   and                                            :

DUSTY   RHODES,                 HAMILTON
COUNTY AUDITOR,                                   :

   and                                            :

ROBERT A. GOEHRING, HAMILTON
COUNTY TREASURER,            :

         Defendants.                              :

Civil Appeal From: Hamilton County Court of Common Pleas

Judgment Appealed From Is: Affirmed

Date of Judgment Entry on Appeal: November 3, 2021

Dave Yost, Ohio Attorney General, and L. Martin Cordero and Corinna V. Efkeman,
Assistant Attorneys General, for Plaintiff-Appellee,

Manley Burke, L.P.A., Sean P. Callan and Ilana L. Linder, for Defendants-
Appellants.
                          OHIO FIRST DISTRICT COURT OF APPEALS

CROUSE, Judge.

       {¶1}    Defendant-appellant Albi Holdings, P.L.L., owns property in Hamilton

County on which defendant-appellant Business Information Solutions (collectively

referred to as “BiS”) operates a commercial records storage facility. Plaintiff-appellee

Ohio Department of Transportation (“ODOT”) instituted appropriation proceedings

to acquire the property, but later abandoned the appropriation. BiS sought

reimbursement from ODOT for employee-retention bonuses it paid after the

appropriation was abandoned.

       {¶2}    The trial court held that the employee-retention bonuses were not a

recoverable expense. BiS has appealed, arguing in two assignments of error that the

trial court erred by failing to properly interpret and apply R.C. 163.21 and 163.62.

For the reasons discussed below, we overrule both assignments of error and affirm

the judgment of the trial court.

                                   Proffered Facts

       {¶3}    Because the Covid-19 pandemic caused courtrooms in Hamilton

County to temporarily close, the parties agreed to allow BiS to proffer facts it

expected to prove at an evidentiary hearing, in lieu of conducting a hearing. For the

purpose of resolving the legal issues presented, we accept the proffered facts as true,

as the trial court did.

       {¶4}    Frank Albi, owner of BiS and Albi Holdings, received an email on May

22, 2014, from ODOT’s real estate administrator informing him that ODOT was

planning a “total take” of his property. The email was in response to an inquiry made

by Albi after he read an article in the newspaper about the reconstruction of the

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                       OHIO FIRST DISTRICT COURT OF APPEALS

Western Hills Viaduct and a portion of Interstate Highway 75. The email stated, in

relevant part:

     Thanks for inquiring about the project. Yes, your property will be needed

     and at this point it is planned to be a total take.

     With the limited funds we have for this project, we have been authorized

     to start the appraisal process on certain priority parcels only, one of

     which is yours. * * * [I]t may be in your best interest to move and re-

     establish as soon as possible simply to keep your business operational

     with the least amount of down time.

       {¶5}      Due to the proposed appropriation, employee retention became a

primary concern for BiS because of the extensive skill and experience involved in the

storing, retrieving, and safeguarding of over 200,000 boxes of records. Additionally,

Albi was scheduled to retire in 2020, and the proposed appropriation caused concern

among employees that Albi would retire early and sell the business.

       {¶6}      In response, BiS developed a “retention policy” in order to incentivize

employees to remain with the company through the appropriation proceedings. On

May 1, 2017, ODOT informed BiS that it was no longer planning a “total take” and

instead would only appropriate part of the property. Sometime thereafter, ODOT

made a “good faith offer” of $200,000 for the partial take and the resulting damage

to the residue of the property. The offer was rejected by BiS. On June 4, 2018, ODOT

commenced the appropriation proceedings by filing a petition for appropriation. On

November 19, 2019, ODOT abandoned the appropriation altogether.               After the

abandonment, BiS paid a total of $212,990 in retention bonuses previously promised

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                        OHIO FIRST DISTRICT COURT OF APPEALS

to its employees. Pursuant to R.C. 163.21(A) and 163.62, it sought reimbursement

from ODOT for the retention bonuses.

                                       R.C. 163.21

         {¶7}   In its first assignment of error, BiS contends that the trial court erred

by failing to properly interpret and apply R.C. 163.21. Because we are interpreting

whether the retention bonuses qualify as “other actual expenses,” under R.C.

163.21(A), the first assignment of error turns on an issue of statutory interpretation.

We review issues of statutory interpretation de novo. 435 Elm Invest., LLC v. CBD

Invest. Ltd. Partnership I, 1st Dist. Hamilton No. C-190133, 2020-Ohio-943, ¶ 8.

         {¶8}   R.C. 163.21 is a remedial law and should be liberally construed in order

to promote its object and assist the parties in obtaining justice. Dept. of Natural

Resources v. Sellers, 14 Ohio App.2d 132, 135, 237 N.E.2d 328 (5th Dist.1968); R.C.

1.11.

         {¶9}   When ODOT or a similar state agency abandons an appropriation

action, R.C. 163.21(A) requires that the court enter judgment against ODOT for

certain expenses incurred by the property owner. The statute reads in pertinent part:

        (2) In all cases of abandonment as described in division (A)(1) of this

        section, the court shall enter a judgment against the agency for costs,

        including jury fees, and shall enter a judgment in favor of each affected

        owner, in amounts that the court considers to be just, for each of the

        following that the owner incurred:

        (a) Witness fees, including expert witness fees;

        (b) Attorney’s fees;

        (c) Other actual expenses.

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                         OHIO FIRST DISTRICT COURT OF APPEALS

R.C. 163.21(A).

        {¶10} The parties agreed on all categories of expenses except the employee-

retention bonuses. The trial court stated that the “single issue” before it was: “Under

R.C. 163.21(A)(2)(c), are retention bonuses paid to employees ‘other actual

expenses?’ ” Relying on Columbus v. Triplett, 127 Ohio App.3d 434, 713 N.E.2d 68

(10th Dist.1998), the trial court determined that “other actual expenses” were limited

to “expenses incurred that are reasonably necessary for the presentation of the

case.” (Emphasis added.) It found that the bonus expenses were “not compensable

under the statute.” It held,

      Although Defendants paid the bonuses to retain employees during a

      move that ultimately did not happen, Defendants’ decision to pay

      employee retention bonuses was a business decision. While it is clear that

      Defendants were placed in a bad situation, this Court finds that the

      statute is limited to ‘other expenses’ that are necessary.1

(Emphasis added.)

        {¶11} BiS’s primary contention is that the trial court applied the wrong

standard in interpreting R.C. 163.21 by requiring that the expenses be “necessary” for

the presentation of the case.

        {¶12} We hold that the trial court properly interpreted R.C. 163.21. First, its

interpretation is consistent with two canons of statutory interpretation.

1 The concurrence states, “The trial court determined that it would be unjust to require ODOT to
reimburse BiS for the severance payments that it incurred as a result of a business decision to
retain employees.” However, the trial court never used the word “just” in its judgment entry. The
court did not invoke its discretion to determine amounts that it believed to be just. Rather, it held
that the retention bonuses were not recoverable under the statute because they were not “other
expenses that are necessary.”

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                        OHIO FIRST DISTRICT COURT OF APPEALS

        {¶13} According to the canon of noscitur a sociis,2 the meaning of an unclear

word may be derived from the meaning of accompanying words. Sunoco, Inc. (R &

M) v. Toledo Edison Co., 129 Ohio St.3d 397, 2011-Ohio-2720, 953 N.E.2d 285, ¶ 43.

Witness fees, including expert witness fees, and attorney fees are expenses necessary

for the presentation of the case. The rule of noscitur a sociis suggests that “other

actual expenses” would also be referring to expenses necessary for the presentation

of the case.

        {¶14} Moreover, the canon of ejusdem generis3 states that “where general

words follow specific words in a statutory enumeration, the general words are

construed to embrace only objects similar in nature to those objects enumerated by

the preceding specific words.” Circuit City Stores, Inc. v. Adams, 532 U.S. 105, 114-

15, 121 S.Ct. 1302, 149 L.Ed.2d 234 (2001).

        {¶15} For example, Adams involved 9 U.S.C. 1, which excludes from the

Federal Arbitration Act “contracts of employment of seamen, railroad employees, or

any other class of workers engaged in foreign or interstate commerce.” Id. at 109.

The Court was asked to interpret whether the residual clause “any other class of

workers engaged in foreign or interstate commerce” referred only to transportation

workers, or included workers such as Adams, who worked at an electronics store. Id.

The Court held, pursuant to the maxim of ejusdem generis, the residual clause

“should be read to give effect to the terms ‘seamen’ and ‘railroad employees,’ and

should itself be controlled and defined by reference to the enumerated categories of

2 Translated from Latin it means “it is known from its associates.” Sunoco, Inc. (R & M) v. Toledo
Edison Co., 129 Ohio St.3d 397, 2011-Ohio-2720, 953 N.E.2d 285, ¶ 43.
3 Translated from Latin it means “of the same kind or species.” State v. Aspell, 10 Ohio St.2d 1, 4,
225 N.E.2d 226 (1967).

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                      OHIO FIRST DISTRICT COURT OF APPEALS

workers which are recited just before it.” Id. at 115. Therefore, the residual clause

applied only to transportation workers, not all workers.

       {¶16} The present case illustrates a textbook example of when the canon of

ejusdem generis should be applied. The residual clause “other actual expenses”

should be read to give effect to “witness fees” and “attorney fees,” and should itself be

controlled and defined by those categories of expenses. Witness and attorney fees

both relate to the case’s legal proceedings, i.e., the determination of, and

presentation of, the value of the property. See In re Appropriation of Easement for

Hwy. Purposes (Preston v. Weiler), 175 Ohio St. 107, 191 N.E.2d 832 (1963),

paragraph one of the syllabus (in cases of appropriation for public highways, roads,

and bridges, the sole issue for the fact finder is to determine the amount of

compensation and damages owed to the landowner); R.C. 5519.01.

       {¶17} Other appellate districts have limited “other actual expenses” to “trial

preparation expenses” or “expenses incurred that are reasonably necessary for the

presentation of the case.” Sellers, 14 Ohio App.2d at 135, 237 N.E.2d 328; Triplett,

127 Ohio App.3d at 439, 713 N.E.2d 68; Village of Wayne Lakes v. Midwest United

Indus., Inc., 2d Dist. Darke No. 1275, 1991 WL 96310, *2 (May 24, 1991).

       {¶18} R.C. 163.21 was enacted to revise and consolidate several separate

appropriation statutes. Sellers at 135. Although R.C. 163.21(A)(2)(c) was not at issue

in Sellers, the case still offers guidance regarding the types of expenses recoverable

as “other actual expenses.” Before repeal, R.C. 2709.24 concerned the dismissal

(abandonment) of appropriation actions by private corporations.            It contained

“practically the same conditions as to allowing and ordering trial preparation

expenses as are now contained in Section 163.21 of the Revised Code.” (Emphasis

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                      OHIO FIRST DISTRICT COURT OF APPEALS

added.) Id. The purpose of R.C. 2709.24 was “to require the public service

corporation to reimburse property owners for costs and expenses incurred in the

conduct of the proceeding where it is voluntarily discontinued.” (Emphasis added.)

Id. at 140. “A liberal construction of the newer remedial law, Section 163.21, Revised

Code, would dictate that the owners of the property sought to be appropriated have

now been provided with a remedy that would enable them to recover for their trial

preparation expenses.” (Emphasis added.) Id. at 135-136.

       {¶19} In Triplett at 439, the case relied on by the trial court in this case, the

Tenth District limited other actual expenses to those expenses “reasonably necessary

for the presentation of the case.” It held that appraiser expenses, if proven by

Triplett, were recoverable. Id. But “because neither an architect’s opinion nor an

engineer’s opinion is relevant to the value of property, there is no way” that Triplett

could recover for the expenses of the architect and engineer. Id. Furthermore,

Triplett and his family members were not entitled to any fees or expenses for

nonprofessional service in relation to the case. Id.

       {¶20} In Village of Wayne Lakes, 2d Dist. Darke No. 1275, 1991 WL 96310,

at *2, the appellant-village argued that the trial court applied the wrong standard

when it determined that fees and expenses under R.C. 163.21 must be “necessary for

the preparation of the case.”     The Second District rejected that argument.       “In

arriving at a ‘just’ determination of expenses to be charged an appropriating agency

after abandonment, the court may weigh the reasonable and necessary nature of an

expense claimed.” Id.

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                      OHIO FIRST DISTRICT COURT OF APPEALS

       {¶21} Accordingly, we hold that the trial court did not err in holding that the

retention bonuses were not recoverable under R.C. 163.21. The first assignment of

error is overruled.

                                     R.C. 163.62

       {¶22} In its second assignment of error, BiS contends that the trial court

erred by refusing to apply R.C. 163.62.

       {¶23} R.C. 163.62(A) provides,

     The court having jurisdiction of a proceeding instituted by a state agency

     to acquire real property by condemnation shall award the owner of any

     right, or title to, or interest in, such real property such sum as will in the

     opinion of the court reimburse such owner for the owner’s reasonable

     costs, disbursements, and expenses, including reasonable attorney,

     appraisal, and engineering fees actually incurred because of the

     condemnation proceeding, as provided in division (G) of section 163.09

     or division (A) or (C) of section 163.21 of the Revised Code, as applicable.

       {¶24} Condemnation refers to the appropriation of property by the exercise

of the power of eminent domain, and courts use “condemn” and “appropriate”

interchangeably. Carroll Weir Funeral Home, Inc. v. Miller, In re Appropriation of

Easement for Hwy. Purposes, 2 Ohio St.2d 189, 193, 207 N.E.2d 747 (1965).

       {¶25} ODOT argues that R.C. 163.62 only applies to “displaced persons,”

defined by R.C. 163.51(E)(1) as “any person who moves from real property, or moves

his personal property from real property, as a direct result of a written notice of

intent to acquire or the acquisition of such real property, in whole or in part, under a

program or project undertaken by a state agency * * *.” The trial court agreed and

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                      OHIO FIRST DISTRICT COURT OF APPEALS

found that R.C. 163.62 does not apply because BiS “did not move from the Property

or move personal property to another location.”

       {¶26} R.C. 163.62 falls under the heading “Relocation Assistance” in the

Revised Code. The “Relocation Assistance” sections (R.C. 163.51 to 163.62) apply to

relocating and compensating landowners who have been forced to move due to an

appropriation of their property.

       {¶27} Other appellate districts have held that R.C. 163.62 only applies to

displaced persons. “R.C. 163.62 and 163.21 provide that if appropriation proceedings

are abandoned, the property owner is entitled to certain damages. Because appellant

and Earl Brothers were not displaced or subject to displacement by condemnation,

we find that R.C. 163.62 does not apply in this case.” Toledo v. Bernard Ross Family

Ltd. Partnership, 165 Ohio App.3d 557, 2006-Ohio-117, 847 N.E.2d 466, ¶ 21 (6th

Dist.), citing Willoughby v. Slyman, 11th Dist. Lake No. 94–L–142, 1996 WL 535287,

*3 (Sept. 13, 1996) (“R.C. 163.62 is simply not applicable to the present case since,

pursuant to R.C. 163.51 et seq., it only applies to ‘displaced persons.’ ”).

       {¶28} However, BiS contends that, although R.C. 163.59 to 163.62 are

grouped with sections concerning displacement, they are not limited to displaced

persons. The terms “displaced person” and “displacing authority,” despite being

defined in R.C. 163.51 and appearing in other sections of the chapter, do not appear

in R.C. 163.62.    Instead, R.C. 163.62 refers to the “owner,” not the “displaced

person,” and authorizes repayment of expenses incurred because of the

“condemnation proceedings,” not “displacement” or “relocation.”

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                      OHIO FIRST DISTRICT COURT OF APPEALS

       {¶29} We need not decide the issue here because, even if R.C. 163.62 applied

to nondisplaced persons as BiS contends, the retention-bonus expenses are not

recoverable under that section.

       {¶30} The General Assembly’s usage of “including” in R.C. 163.62(A) means

that recoverable expenses are not limited to attorney, appraisal, and engineering

fees. But, according to the canon of noscitur a sociis, the specified list of recoverable

expenses bears on the types of other expenses that may be recoverable. Whereas

attorney, appraisal, and engineering expenses relate to the condemnation proceeding

and the valuation of the property, the retention bonuses relate to the conduct of the

business. As the trial court stated, the bonuses were a business decision.

       {¶31} The Ohio Administrative Code supports this interpretation. Ohio

Adm.Code 5501:2-5-01 to 5501:2-5-06 were enacted to “amplify sections 163.51 to

163.63 of the Revised Code * * *.” Ohio Adm.Code 5501:2-5-06 provides additional

guidance as to what types of expenses are recoverable. According to section (G),

where there has been a final judgment against the agency or the agency has

abandoned the appropriation, the owner is entitled to “certain litigation expenses,”

such as “attorney, appraisal, and engineering fees, which the owner actually incurred

because of a condemnation proceeding.” (Emphasis added.)

       {¶32} Accordingly, we hold that the employee-retention bonuses are not

recoverable under R.C. 163.62. The second assignment of error is overruled.

                                     Conclusion

       {¶33} Because the employee-retention bonuses do not qualify as recoverable

expenses under either R.C. 163.21 or 163.62, both assignments of error are overruled

and the judgment of the trial court is affirmed.

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                     OHIO FIRST DISTRICT COURT OF APPEALS

                                                                   Judgment affirmed.

WINKLER, J., concurs.
ZAYAS, P.J., concurs separately.

ZAYAS, P.J., concurring separately.

       {¶34} I agree with the majority that BiS is not entitled to recover the

employee-severance payments under R.C. 163.21 or 163.62. But I disagree with the

majority that we must resort to statutory interpretation of R.C. 163.21 to reach that

conclusion. Although BiS requests that we employ a de novo review, arguing that the

trial court added the word “necessary” to “other actual expenses,” I find that the

court propely exercised its discretion in determining a just award, and we should

review that determination for an abuse of discretion. Village of Wayne Lakes, 2d

Dist. Darke No. 1275, 1991 WL 96310, at *2.

       {¶35} BiS’s proffer that it incurred an employee bonus expense of

$212,900.46 in response to the potential appropriation is not disputed. The trial

court’s finding that the employee bonuses were actually business expenses is also

undisputed. The trial court determined that payment of the employee-retention

bonuses was not necessary and prevented recovery. In essence, the court determined

that it would not be just to enter a judgment against ODOT for BiS’s business

expenses. Thus, the issue in this case is whether the trial court abused its discretion

in determining that it was unjust for BiS to recover its business expenses.

       {¶36} Under R.C. 163.21(A)(2), the trial court “shall enter a judgment in

favor of each affected owner, in amounts that the court considers to be just.”

Accordingly, the trial court has broad discretion to determine a just amount. “In

arriving at a ‘just’ determination of expenses to be charged an appropriating agency

after abandonment, the court may weigh the reasonable and necessary nature of an

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                      OHIO FIRST DISTRICT COURT OF APPEALS

expense claimed.” Village of Wayne Lakes at *2. Absent a showing of an abuse of

discretion on the part of the trial court, we will not disturb its findings. Id. An abuse

of discretion connotes the trial court acted in an arbitrary, unreasonable, or

unconscionable manner.      Blakemore v. Blakemore, 5 Ohio St.3d 217, 219, 450

N.E.2d 1140 (1983).

       {¶37} Here BiS contested the value of the property that ODOT wished to

acquire, prompting ODOT to file its petition in June 2018. In defending against the

appropriation, BiS sought to establish that ODOT failed to offer fair market value for

the property. Once ODOT abandoned the appropriation, the parties agreed that BiS

was entitled to costs and expenses in the amount of $125,000 for attorney’s fees and

expenses, expert witness fees, appraisal costs, and engineering fees expended by BiS

to establish the value of the property. BiS also sought an award of $212,900.46 for

the bonus payments it paid to its employees. The trial court found “that the statute is

limited to other expenses that are necessary. While retention bonuses may have kept

employees in place, bonuses were not something that Defendants had to offer

employees.”

       {¶38} Prior to ODOT’s interest in the property, the owner of BiS had

announced to his employees that he intended to retire in 2020. When BiS learned of

the future rebuild of Interstate 75, it contacted ODOT to determine if its property

would be affected by the project. In May 2014, ODOT informally responded via

email that it anticipated the entire BiS property would be necessary. However,

ODOT did not initiate an appropriation action at that time.

       {¶39} After receiving the email, BiS verbally offered a severance plan to

incentivize employee retention. BiS told its employees that they would receive the

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                        OHIO FIRST DISTRICT COURT OF APPEALS

severance bonuses if they remained with BiS throughout the ODOT appropriation

and business relocation. In December 2016, BiS adopted its verbal promise as a

corporate “Severance Policy” that it posted on its bulletin board, in large part

because the employees became concerned that the owner would sell the property to

ODOT and retire. As the owner conceded in the proffer,

          [m]y staff began to worry I would sell the company out from under

          them because in BiS’ Strategic Plan I had set 2020 as my retirement

          year. I was warned employees—especially the younger ones—might

          decide to bail out while they were still young enough to find new jobs.

          With input from my outside board of advisors, I established my

          ‘Severance Policy.’ At some point it occurred to me Chanel No. 5 is sold

          based on its ‘fragrance’ and not its ‘odor,’ so I switched to calling it

          “Retention Bonus.”

At the time the policy was instituted, ODOT had not initiated an appropriation

action.

          {¶40} In May 2017, ODOT informed BiS via email that it would pursue a

partial take. Shortly thereafter, ODOT delivered a written notice of intent and good

faith offer, in compliance with R.C. 163.04 and 163.041 to acquire the property for

$200,000. See R.C. 163.05. When the parties were unable to negotiate a price,

ODOT filed its petition to acquire the property in June of 2018.            After ODOT

abandoned the appropriation in November 2019, BiS paid its employees the bonus

payments in two installments totaling $212,900.46.

          {¶41} BiS argues that it is entitled to a reimbursement of the retention

payments because it incurred the obligation in response to an email from ODOT

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                      OHIO FIRST DISTRICT COURT OF APPEALS

contemplating a potential appropriation. ODOT argues that the bonuses were not

related to the litigation, and the decision to pay the bonuses was a business decision

in response to the owner’s retirement.

       {¶42} The trial court made a factual determination that the payment of the

employee-retention bonuses was a business decision by BiS. As such, the court

concluded that the bonuses were not a necessary expense related to the

appropriation proceedings and denied recovery.              In essence the trial court

determined that it would be unjust to require ODOT to reimburse BiS for the

severance payments that it incurred as a result of a business decision to retain

employees. Under the statute, the trial court was entitled to limit recovery to only

those expenses, actually incurred, that were reasonable and necessary. See Village of

Wayne Lakes, 2d Dist. Darke No. 1275, 1991 WL 96310, at *2.

       {¶43} The fact that the trial court did not include the word “just” in its entry,

does not change the analysis. The net effect of the majority’s opinion is that a

limitation on expenses is being read into the statute as a matter of law when the

legislature provided that limitations of expenses are within the discretion of the trial

court. Consequently, I concur separately.

Please note:
       The court has recorded its own entry on the date of the release of this opinion.

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