In re Petition for Incorporation of the Village of Holiday City

[This decision has been published in Ohio Official Reports at 70 Ohio St.3d 365.]

IN RE PETITION FOR INCORPORATION OF THE VILLAGE OF HOLIDAY CITY: BOARD OF

TRUSTEES OF JEFFERSON TOWNSHIP ET AL., APPELLANTS, V. PETITIONERS FOR

INCORPORATION OF THE VILLAGE OF HOLIDAY CITY ET AL., APPELLEES.

[Cite as In re Petition for Incorporation of the Village of Holiday City,

1994-Ohio-405.]

Townships—Trustees may not challenge a board of county commissioners’ decision

involving a petition for incorporation through either an R.C. Chapter 2506 appeal

or an R.C. 707.11 proceeding—Township trustees may not challenge a board of

county commissioners’ decision involving a petition for incorporation through

either an R.C. Chapter 2506 appeal or an R.C. 707.11 proceeding.

(No. 93-1115 -- Submitted May 25, 1994 -- Decided September 28, 1994.)

Appeal from the Court of Appeals for Williams County, No. 92WM000011.

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{¶ 1} This appeal arises from four separate cases filed in the Court of Common

Pleas for Williams County. The facts concerning this appeal are not in dispute.

{¶ 2} On July 16, 1991, various landowners residing in Jefferson Township,

Williams County, Ohio, appellees, filed a petition with the Board of Commissioners of

Williams County to incorporate an area of the township and establish a village to be known

as Holiday City.1 Appellees are residents of the area in question. On August 26, 1991, the

board held a public hearing with respect to the petition.

1. In this case twenty-three landowners filed a petition proposing to incorporate a certain area within

Jefferson Township as a village. Under the law in effect when the petition was filed, to begin the

incorporation procedure, a petition must be signed by a majority of adult freeholders within the territory

proposed to be incorporated and it must contain specific information. Former R.C. 707.02, Am.S.B. No. 221,

132 Ohio Laws, Part I, 353. The petition is presented to the board of county commissioners, which files it

with the county auditor. Former R.C. 707.03, id. at 354. A public hearing regarding the petition is then

conducted by the commissioners. R.C. 707.05 and 707.06. At the hearing, "[a]ny person interested may

appear, in person or by attorney, and contest the granting" of the petition. R.C. 707.06. If the board decides

to grant the petition, the board's decision must be based on various factors. R.C. 707.07. For example, the

board must consider the "general good" of the community. This includes the territory sought to be

incorporated and the surrounding area. Former R.C. 707.07(D) and (E)(3), 132 Ohio Laws, Part II, at 357.

The transcript of the board's order, if the petition is granted, is filed with the county recorder, R.C. 707.08,

who is then required to file a copy of the record of the proceedings with the Secretary of State, R.C. 707.09.

However, within sixty days from the filing of the papers relating to the incorporation of a village by the board

with the county recorder, "any person interested" may file an action with "the court of common pleas setting

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{¶ 3} The August 26, 1991 hearing was attended by appellants, Board of Trustees

of Jefferson Township, Howard Ames and Dale Holtrey. Ames and Holtrey are

landowners and residents of the township, but they live outside the area sought to be

incorporated. Also present and participating at the hearing was amicus curiae, Toledo

Edison Company (“Toledo Edison”), which owns and maintains land within the area at

issue. Appellants and Toledo Edison challenged the proposed incorporation.

{¶ 4} Following the hearing, the board granted the petition. Thereafter, appellants

filed, in the Court of Common Pleas of Williams County, an R.C. Chapter 2506 appeal

from the board’s determination. This appeal was assigned case No. 91-CI-129 (“case No.

129”). In addition, appellants filed an R.C. 707.11 injunction proceeding, claiming that

the board’s decision was unreasonable and unlawful. Appellants requested that the trial

court prohibit the Recorder of Williams County from making and filing a copy of the record

of incorporation with the Ohio Secretary of State. Appellants’ injunction action was

assigned case No. 91-CI-143 (“case No. 143”). Meanwhile, Toledo Edison also filed, in

the same court, a statutory injunction proceeding and an administrative appeal regarding

the board’s ultimate decision granting the petition. Toledo Edison’s R.C. 707.11 action

was assigned case No. 91-CI-125 (“case No. 125”) and its R.C. Chapter 2506 appeal case

No. 91-CI-128 (“case No. 128”).

{¶ 5} Subsequently, appellees filed motions to dismiss appellants’ administrative

appeal and statutory injunction action (case Nos. 129 and 143). The trial court issued

separate judgment entries granting these motions and, citing In re Appeal of Bass Lake

Community, Inc. (1983), 5 Ohio St.3d 141, 5 OBR 273, 449 N.E.2d 771, determined that

the township trustees lacked standing to pursue an administrative appeal from the board’s

decision, or to oppose the incorporation of the village under R.C. 707.11. The trial court

made a similar determination with respect to Ames and Holtrey. On February 20, 1992,

appellants appealed the judgments of the trial court, regarding case Nos. 129 and 143, to

the Court of Appeals for Williams County.

forth the errors complained of or claiming the decision of the board is unreasonable or unlawful, and praying

an injunction restraining the recorder from making the record and filing a copy of the record with the secretary

of state pursuant to section 707.09 of the Revised Code." R.C. 707.11. Further, R.C. 707.28 provides for a

division of township property and funds when an incorporation is eventually granted. To obtain a division,

the village must file an application with the probate court. Id.

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{¶ 6} On March 4, 1992, appellants also moved to intervene in both Toledo Edison

cases (case Nos. 125 and 128). The trial court, in separate judgment entries, denied

appellants’ motions. As a result, appellants appealed those judgments to the court of

appeals.2

{¶ 7} On March 4 and April 22, 1992, the court of appeals, sua sponte, consolidated

all four cases, assigning the appeals as case No. 92WM000011. The court of appeals

affirmed the judgments of the trial court, finding that the court did not err in dismissing

case Nos. 129 and 143 or denying appellants’ motion to intervene in case Nos. 125 and

128.

{¶ 8} This cause is now before the court pursuant to the allowance of a motion to

certify the record.

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Gary F. Kuns and Robert C. Battin, for appellants.

David W. Zoll & Associates, David W. Zoll and Michelle L. Kranz, for appellees.

Fuller & Henry, Craig J. Van Horsten, Mary Ann Whipple and Lance M. Keiffer,

urging reversal for amicus curiae, Toledo Edison Company.

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DOUGLAS, J.

{¶ 9} The issue before this court is whether R.C. 707.11 and R.C. Chapter 2506

present potential avenues of review available to township trustees and individual property

owners to challenge a board of county commissioners’ decision granting a petition for

incorporation of a village. Specifically, appellants claim that the trial court erred in

denying them standing to bring an R.C. Chapter 2506 appeal in case No. 129, to pursue an

R.C. 707.11 injunction action in case No. 143, and to participate in case Nos. 125 and 1283

involving Toledo Edison. For the sake of clarification with respect to the applicable law,

we have categorized appellants into two classes, the trustees and the individual property

owners.

2. An interesting question exists as to whether a denial of a motion to intervene is a final appealable order

under R.C. 2505.02 and what import, if any, Civ.R. 54(B) has for such denial. These issues, however, were

never raised and, therefore, we make no further comment.

3. On October 1, 1993, the trial court dismissed Toledo Edison's R.C. Chapter 2506 appeal (case No. 128).

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A. Township Trustees

{¶ 10} Although we have not specifically dealt with the questions raised by

appellants’ contentions involving incorporation disputes, this court has, on various

occasions, reviewed the statutory scheme concerning Ohio’s annexation law and evaluated

remedies available to township trustees and others in annexation proceedings. We are fully

aware that annexation and incorporation are different concepts and, in some instances,

present different policy considerations. However, we believe that a brief review of some

of our decisions in the area of annexation lends insight into whether township trustees have

standing to oppose a board of county commissioners’ decision granting a petition for

incorporation.

{¶ 11} In In re Appeal of Bass Lake Community, Inc., supra, this court held that

township trustees do not have standing under R.C. 307.56 and 2506.01 to participate in an

appeal from a decision of a board of county commissioners denying an annexation petition,

but that the trustees do have standing to pursue an R.C. 709.07 injunction proceeding where

a petition for annexation has been granted. The township trustees in Bass Lake argued that

the 1980 amendments to R.C. Chapter 709, when read in conjunction with R.C. 505.62

(which was enacted at the same time as amendments to R.C. Chapter 709, Am.S.B. No.

151, 138 Ohio Laws, Part I, 409), granted them the right to participate in an R.C. Chapter

2506 appeal of the county commissioners’ decision in an annexation proceeding. At the

time, R.C. 505.62 authorized township trustees to appropriate funds for representation by

an attorney at annexation proceedings before a board of county commissioners and upon

any appeal of a board’s decision brought pursuant to R.C. 709.07.

{¶ 12} We disagreed with the trustees’ contentions in Bass Lake and determined

that R.C. 505.62 “clearly provides that the use of an attorney to represent the township

upon an appeal is permitted solely when the appeal is pursuant to R.C. 709.07. That is not

the present case. Appellees’ [the petitioning landowners’] appeal was taken under the

authority of R.C. Chapter 2506, not as an R.C. 709.07 proceeding.” Id., 15 Ohio St.3d at

143, 5 OBR at 275, 449 N.E.2d at 774. We further explained that:

“From these provisions it can be seen that the General Assembly has

afforded a considerable right of appeal to those whose rights are directly

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affected. In contrast, the General Assembly has provided a carefully limited

form of relief for other persons to oppose an annexation petition which has

been granted. The General Assembly intended these other persons to

contest the petition only by meeting the stiffer standards required for an

injunction and thus R.C. 709.07 is their sole remedy. There is no protection

afforded the township trustees under R.C. Chapter 2506.”

Id. at 144, 5 OBR at 276, 449 N.E.2d at 774.

{¶ 13} In response to our decision in Bass Lake, the General Assembly amended

R.C. 505.62. As a result, township trustees can now appropriate funds for any appeal of a

board’s decision pursuant to R.C. 709.07 or R.C. Chapter 2506. In addition, the General

Assembly specifically added the language, “The board of township trustees * * * has

standing in any appeal of the board of county commissioners’ decision on the annexation

of township territory that is taken pursuant to section 709.07 or Chapter 2506. of the

Revised Code * * *.” (Emphasis added.) R.C. 505.62 (see 140 Ohio Laws, Part I, 2196).

Interpreting this amendment, this court has held that township trustees may appeal a board

of county commissioners’ denial of a petition for annexation through an R.C. Chapter 2506

appeal, but R.C. 709.07 provides the exclusive remedy for those who challenge a board’s

approval of a petition. See In re Annexation of 311.8434 Acres of Land (1992), 64 Ohio

St.3d 581, 597 N.E.2d 4604; see, also, In re Annexation of 466.112 Acres of Land (1992),

65 Ohio St.3d 226, 602 N.E.2d 1136; compare In re Petition to Annex 320 Acres to the

Village of S. Lebanon (1992), 64 Ohio St.3d 585, 597 N.E.2d 463.

{¶ 14} In essence, Bass Lake and its progeny reinforce the well-settled principle

that township trustees can exercise only those powers granted by the General Assembly.

See, also, Trustees of New London Twp. v. Miner (1875), 26 Ohio St. 452, 456 (“[N]either

the township nor its trustees are invested with the general powers of a corporation; and

hence the trustees can exercise only those powers conferred by statute, or such others as

are necessarily to be implied from those granted, in order to enable them to perform the

4. Upon reflection, we recognize that the facts of In re Annexation of 311.8434 Acres of Land (1992), 64

Ohio St.3d 581, 597 N.E.2d 460, were that the county commissioners had approved the annexation in

question and the issue in that case was not whether the trustees could participate in some action questioning

the commissioners' action denying an annexation.

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duties imposed upon them.”); and Geauga Cty. Bd. of Commrs. v. Munn Rd. Sand & Gravel

(1993), 67 Ohio St.3d 579, 621 N.E.2d 696 (Local authorities, such as counties and other

entities, absent home rule authority, may exercise only those powers affirmatively granted

by the General Assembly.). Therefore, the question we are confronted with is whether the

General Assembly conferred upon the township trustees statutory authority to pursue an

R.C. Chapter 2506 appeal from the decision of the board of county commissioners or

challenge the decision by way of an R.C. 707.11 action.

{¶ 15} As is evident, the General Assembly has cloaked township trustees with

certain remedies under R.C. 505.62 regarding annexation proceedings. However, there is

no specific statutory counterpart to R.C. 505.62 with respect to a decision by a board of

county commissioners involving the incorporation of a village. Further, we have reviewed

R.C. Chapter 707 and R.C. Chapter 2506 and there is nothing within those statutory

schemes that provides appellants with standing to seek review of a board’s decision

involving incorporation matters. Therefore, absent a specific directive from the General

Assembly, township trustees are powerless to pursue an R.C. Chapter 2506 appeal or bring

an R.C. 707.11 injunction action challenging a board’s decision.

{¶ 16} Appellants also take issue with the holdings of the trial court denying it the

opportunity to participate in matters involving Toledo Edison. However, as is the case

with an administrative appeal and an R.C. 707.11 proceeding, the General Assembly has

not provided township trustees with the authority to intervene under Civ.R. 24. Moreover,

there is no right to participate in an appeal from an order of the county commissioners

where those who seek to intervene are precluded from appealing in their own right. See

Bass Lake, supra, 5 Ohio St.3d at 144-145, 5 OBR at 276, 449 N.E.2d at 775 (“No other

statutory authority gives township trustees the right to intervene in an R.C. Chapter 2506

appeal. Appellants are not necessary parties under R.C. 2506.01 because they possess no

rights which have been adjudicated. Lacking authority to intervene, appellants lack

standing to participate in the current appeal.”).

{¶ 17} In light of the foregoing, we find that township trustees may not challenge a

board of county commissioners’ decision involving a petition for incorporation through

either an R.C. Chapter 2506 appeal or an R.C. 707.11 proceeding. Thus, we find that the

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trial court did not err in dismissing the township trustees’ actions in case Nos. 129 and 143,

and denying the trustees’ request to intervene in case Nos. 125 and 128.

B. Individual Property Owners

{¶ 18} We are also presented with the question of whether Ames and Holtrey may

utilize R.C. Chapter 2506 and R.C. 707.11 to challenge the board's decision. Ames and

Holtrey, while residents of the township, do not own land within the area approved by the

board to be incorporated. In fact, both landowners reside at least seven miles from the area

in question. Notwithstanding, we agree with the court of appeals that even though

appellants Ames and Holtrey do not own land or reside within the territory at issue, those

facts alone are not sufficient to deny them standing to challenge the board’s decision. See,

generally, Geauga Lake Improvement Assn. v. Lozier (1932), 125 Ohio St. 565, 182 N.E.

4895; and R.C. 707.06 and 707.07(D). Rather, the right to seek review of a board’s decision

is subject to limitations contained in R.C. 707.11 and 307.56.

{¶ 19} R.C. 707.11 sets forth that only those persons who are “interested” may

challenge a board’s decision. On the other hand, R.C. 307.56 provides that persons must

be “aggrieved” by the decision in order to appeal to the common pleas court under R.C.

Chapter 2506. Further, R.C. 2506.01 limits the availability of an appeal to those whose

“rights, duties, privileges, benefits, or legal relationships” are adversely affected. We have

construed R.C. Chapter 2506 to permit appeals only by those who are directly affected by

the administrative decision. See Bass Lake, supra, 5 Ohio St.3d at 144, 5 OBR at 276, 449

N.E.2d at 774. See, also, Schomaeker v. First Natl. Bank of Ottawa (1981), 66 Ohio St.2d

304, 311-312, 20 O.O.3d 285, 290, 421 N.E.2d 530, 537.

{¶ 20} Regardless of whether appellants are seeking a remedy under R.C. 707.11

or 307.56, they are, for all practical purposes, appealing the board’s decision. In Ohio

Contract Carriers Assn. v. Pub. Util. Comm. (1942), 140 Ohio St. 160, 23 O.O. 369, 42

N.E.2d 758, syllabus, we held that “[a]ppeal lies only on behalf of a party aggrieved by the

final order appealed from. Appeals are not allowed for the purpose of settling abstract

questions, but only to correct errors injuriously affecting appellant.” In reaching this

5. Geauga Lake Improvement Assn. v. Lozier (1932), 125 Ohio St. 565, 182 N.E. 489, involved a predecessor

statute to R.C. 707.11. Although Geauga Lake did not involve the issue of standing, a close reading of that

decision indicates that adjacent property owners of the area sought to be incorporated would not be denied

standing to challenge the allowance of a petition for incorporation.

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holding, we explained that the party appealing must have a “‘present’” and “‘substantial’”

interest in the subject matter of the litigation and must be “‘aggrieved or prejudiced’” by

the decision. Id. at 161, 23 O.O. at 369, 42 N.E.2d at 759. We further recognized that such

an interest must affect a substantial right and it must be “‘immediate and pecuniary, and

not a remote consequence of the judgment; a future, contingent or speculative interest is

not sufficient.’” Id.

{¶ 21} Ames and Holtrey suggest they are interested and aggrieved persons by

virtue of their status as landowners living in the township. The crux of appellants’

discontent with the board’s decision granting the incorporation is that the township’s tax

base and governmental services may decrease if the village of Holiday City files for a

division of township property and funds under R.C. 707.28, or petitions for removal of the

village from the township pursuant to R.C. Chapter 503. Appellants’ concerns are

speculative at best and fail to expose a present interest in the matters at issue. A board’s

decision to grant or deny a petition for incorporation involves an entirely different

procedure from that of an R.C. 707.28 proceeding. Furthermore, even assuming arguendo

that the village decides to file in the probate court for a division of township property and

funds, the harm alleged by appellants appears to be nothing more than a generalized

grievance shared by a large class of citizens. See, generally, Warth v. Seldin (1975), 422

U.S. 490, 499, 95 S.Ct. 2197, 2205, 45 L.Ed.2d 343, 354; and Valley Forge Christian

College v. Americans United for Separation of Church & State (1982), 454 U.S. 464, 102

S.Ct. 752, 70 L.Ed.2d 700.

{¶ 22} For the foregoing reasons, we conclude that Ames and Holtrey are neither

interested nor aggrieved persons. Accordingly, we find that the court of appeals properly

determined that appellants lacked standing to contest the board's decision in case Nos. 129

and 143. Further, appellants have failed to demonstrate that their interests are sufficient to

permit them to participate in case Nos. 125 and 128.

Judgment affirmed.

MOYER, C.J., A.W. SWEENEY, KOEHLER and F.E. SWEENEY, JJ., concur.

WRIGHT and PFEIFER, JJ., dissent.

RICHARD N. KOEHLER, J., of the Twelfth Appellate District, sitting for RESNICK, J.

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PFEIFER, J., dissenting.

{¶ 23} If township trustees do not have standing to challenge a county

commissioners’ determination of what constitutes the community good, then who does?

{¶ 24} R.C. 707.11 provides that “any person interested” may judicially challenge

an incorporation approved by the county commissioners. Of course, while R.C. 707.11

confers on any person interested the right to seek the prescribed injunction, the provision

does not define the meaning of “person interested.” Instead of looking to annexation law,

we may determine the meaning of “person interested” by considering other provisions of

Ohio’s incorporation statutes which, are to be read in pari materia with R.C. 707.11.

{¶ 25} R.C. 707.07 lists the various findings which the county commissioners must

make before they may enter an order approving an incorporation. R.C. 707.07(D) and

former R.C. 707.07(E) specifically require that before an incorporation may be approved,

the county commissioners must first determine that “the general good of the community,

including both the proposed municipal corporation and the surrounding area, will be served

if the incorporation petition is granted.” (Emphasis added.)

{¶ 26} The plain language of the statute indicates that in an incorporation

proceeding the county commissioners must consider the interests of not only persons

within the proposed village, but also of persons in the surrounding township.

{¶ 27} To ensure a proper determination of the community good, R.C. 707.06

requires the county commissioners to hold a public hearing on the merits of the

incorporation:

{¶ 28} “The hearing provided for in section 707.05 of the Revised Code shall be

public. Any person interested may appear, in person or by attorney, and contest the

granting of the prayer of the petition provided for by section 707.02 of the Revised Code,

and affidavits presented in support of or against the prayer of such petition shall be

considered by the board.”

{¶ 29} Again, “person interested” is not defined in R.C. 707.06. But when read

together with R.C. 707.07(D) and (E), R.C. 707.06 calls for a public hearing where the

interests of the surrounding area will be heard, as well as the interests of the proposed

village. If the hearing is public, and the good of the entire community is to be discussed,

those in the surrounding community necessarily are entitled to be heard. Trustees, elected

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to represent the township and to oversee its government, finances and development, thus

must be “persons interested” pursuant to R.C. 707.06, and therefore have standing in

litigation concerning the incorporation.

{¶ 30} When R.C. 707.06 and R.C. 707.11 are read in pari materia, it is clear that

those persons entitled to speak as “persons interested” under R.C. 707.06 are also “persons

interested” under R.C. 707.11, and have the right to commence the statutory injunction

proceeding. The only way to ensure that the commissioners live up to their statutory

mandate to consider the good of the surrounding area is to grant interested persons from

the surrounding area the right to challenge the commissioners’ ruling.

{¶ 31} The majority errs in looking to annexation law for guidance in determining

this question of incorporation. The protection of the surrounding community is absent from

Ohio’s annexation provisions. R.C. 709.07, like R.C. 707.11, permits a person interested

to commence a statutory injunction proceeding. However, the annexation statutes

specifically permit the commissioners to consider only “the general good of the territory

sought to be annexed.” R.C. 709.033(E). This crucial difference from incorporation law

leaves township trustees outside the scope of the phrase “person interested” under Ohio’s

annexation statutes.

WRIGHT, J., concurs in the foregoing dissenting opinion.

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