Ohio’s Political Subdivision Immunity Act Does Not Undercut Ohio’s Taxpayer Action Statute

Ohio empowers its citizenry in some instances to act on behalf of municipalities “to restrain the misapplication of funds of the municipal corporation, the abuse of its corporate powers, or the execution or performance of any contract made on behalf of the municipal corporation in contravention of the laws of or ordinance governing it.” (R.C. 733.56) And provides that when successful, the taxpayer who initiated the lawsuit is entitled to have the costs of the suit paid by the municipality – including her attorney fees.

In 2014 a North College Hill taxpayer brought suit to enjoin the city from performing on an unlawful contract entered into with XPEX, LLC. The city argued that under Ohio’s political subdivision immunity act (R.C. 2744) it was immune from suit because the taxpayer sought to have her attorney fees paid as provided by the statute.

The trial court rightly denied the city’s argument and city appealed the decision.

Earlier this month, the First District Court of Appeals joined the trial court in rejecting the city’s argument finding that the political subdivision immunity act was not applicable because (i) the case was not a tort case; and (ii) an award for attorney fees under R.C. 733.56 does not constitute “monetary damages.”

Citizen activists should be particularly heartened by this decision as two of the court of appeals judges in this unanimous decision were recently elected to serve on Ohio’s Supreme Court.

The Court of Appeals decision can be read here.

 

Thus, Ohio taxpayers remain empowered to act as watchdogs over their public officials.

 

 

 

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