[Cite as TMS Ents., Ltd. v. Cleveland, 2026-Ohio-3229.]
COURT OF APPEALS OF OHIO
EIGHTH APPELLATE DISTRICT
COUNTY OF CUYAHOGA
TMS ENTERPRISES LTD., ET AL., :
Relators-Appellees, :
No. 115774
v. :
THE CITY OF CLEVELAND, OHIO, :
Respondent-Appellant. :
JOURNAL ENTRY AND OPINION
JUDGMENT: AFFIRMED
RELEASED AND JOURNALIZED: August 20, 2026
Civil Appeal from the Cuyahoga County Court of Common Pleas
Case No. CV-23-986870
Appearances:
Mark D. Griffin, Cleveland Director of Law, Jerome A.
Payne, Jr., Assistant Law Director, and James R. Russell,
Jr., Chief Assistant Director of Law, for appellant.
The Lindner Law Firm LLC and Daniel F. Lindner, for
appellees.
MARY J. BOYLE, P.J.:
Respondent-appellant the City of Cleveland (“the City”) appeals the
decision of the Cuyahoga County Court of Common Pleas granting summary
judgment and injunctive relief in favor of relators-appellees TMS Enterprises Ltd., et al. (“TMS”). The City also appeals the trial court’s decision denying its motion for
summary judgment. The City raises the following assignments of error for review:
Assignment of Error I: The trial court erred as a matter of law by
granting summary judgment to [TMS] and issuing a writ of mandamus
to compel appropriation proceedings.
Assignment of Error II: The trial court erred by granting [TMS] an
overbroad and unnecessary injunction that is moot.
Assignment of Error III: The trial court erred as a matter of law by
denying the City’s motion for summary judgment because [TMS] had
an adequate remedy at law and the case is moot after the results of the
administrative proceedings.
For the reasons set forth below, we affirm.
I. Facts and Procedural History
This case is the second of three cases filed by TMS against the City,
which stems from the rezoning of Harvard Avenue from East 55th Street to
Broadway Avenue, in Cleveland, Ohio, in an area commonly known as Slavic Village.
The rezoning affected the property located at 6806 Harvard Avenue (the “Property”)
that was purchased by TMS prior to the rezoning.
The following is a summary of the facts documented in the first two
cases.
TMS is an Ohio limited liability company that sells used cars and
develops real estate. TMS purchased the Property, which contained two parcels,
from the Cuyahoga County Sheriff’s Office for $12,100 in February 2020. The
parcels were consolidated on September 24, 2020.
At the time of purchase, the Property was zoned as General Retail-C2.
Although a two-story home existed on the Property, the zoning classification for
General Retail permitted many business uses, including the sale of motor vehicles.
TMS planned to operate a used car lot on the Property.
On September 22, 2020, TMS filed a change-of-use application with
the City’s Department of Building and Housing (“Building and Housing”), seeking
to change the use from residential to a used car sales facility. Additionally, TMS
applied for permits to begin the process of transforming the property into a used car
sales lot. After applying for the permits, TMS demolished the two-story house on
the property.
On October 7, 2020, the City enacted zoning ordinance No. 760-2020, which changed the zoning classification of the Property from General Retail
C-2 to Multi-Family District-D2. The zoning change took effect in November 2020
and did not permit used car sales.
TMS then filed an application for compliance with Building and
Housing. Building and Housing responded with a notice of nonconforming use
acknowledging that a used car lot was permitted under the prior zoning
classification but was not permitted under the new classification.
In April 2021, TMS submitted a variance application to the Cleveland
Board of Zoning Appeals (“BZA”) requesting a change use. The BZA held a public
hearing on the requested variance in July 2021. After the hearing, the BZA
unanimously denied TMS’s variance request.
The First Case — The Administrative Appeal
In August 2021, TMS appealed the BZA’s decision to deny the
variance to the Cuyahoga County Court of Common Pleas, in accordance with R.C.
Ch. 2506. See TMS Ents. Ltd. v. City of Cleveland Bd. of Zoning Appeals, Cuyahoga
C.P. No. CV-21-952073. The trial court affirmed the BZA’s decision, finding that
there was no evidence that TMS engaged in a permissible, nonconforming use prior
to the rezoning that would have conferred a vested right in the Property for the
nonconforming use. The trial court also found TMS’s property was not subject to
illegal spot zoning because the evidence in the administrative record showed that
although the Property was near a business district, it was surrounded by residences.
(Journal Entry, Sept. 29, 2023.)
TMS appealed the trial court’s order to this court. See TMS Ents. v.
Cleveland Bd. of Zoning Appeals, 2024-Ohio-1888 (8th Dist.) (“TMS I”).
On appeal, TMS raised two assignments of error for review. In its first
assignment of error, TMS argued that the rezoning did not apply to the Property
because TMS had a vested right in a preexisting nonconforming use because TMS
applied for permits prior to the rezoning ordinance taking effect. In its second
assignment of error, TMS argued that the decision of the BZA should be reversed
because the rezoning of the Property constituted unconstitutional spot zoning.
This court agreed that “TMS had a vested right in the prior general
retail zoning classification that allowed the sale of used cars,” because TMS filed a
change-of-use application and permits to demolish the two-story residence while the property was still zoned general retail. We held that “the trial court erred as a
matter of law in finding that TMS did not have a vested right in that preexisting,
nonconforming use.” TMS I at ¶ 22.
Because the first assignment of error was dispositive, the second
assignment of error was rendered moot. The trial court’s decision was reversed, and
the case was remanded to the BZA to “consider TMS’s change-of-use application in
light of its vested right to use the property under the property’s general retail zoning
classification.” Id. at ¶ 25.
Upon remand the BZA granted the change-of-use variance.
The Second Case — Current Appeal
Also in August 2021, TMS filed a second case against the City
requesting declaratory judgment, a writ of mandamus, and injunctive relief arguing
that the zoning ordinance was unconstitutional and constituted a taking of the
Property without just compensation. See TMS Ents. Ltd. v. Cleveland, Cuyahoga
C.P. No. CV-21-952329. That case was dismissed without prejudice in May 2023
and refiled in October 2023 as TMS Ents. Ltd. v. Cleveland, Cuyahoga C.P. No. CV23-986870.
The complaint set forth four causes of action. In Count 1, TMS
requested declaratory judgment stating that the Multi-Family District designation
was unconstitutional on its face and as applied to TMS. (Comp. at ¶ 21-22.) In Count
2, TMS requested declaratory judgment stating that the Multi-Family District
designation as applied to the Property is a taking under Article I, Section 19 of the Ohio Constitution for which TMS is entitled to just compensation from the City.
(Comp. at ¶ 29-30.) In Count 3, TMS sought a mandamus action ordering the City
to commence appropriation proceedings to compensate TMS for the
unconstitutional taking of the Property. (Comp. at ¶ 36.) And in Count 4, TMS
requested a permanent injunction enjoining the City from enforcing the MultiFamily District designation against TMS and from retaliating against TMS for
bringing this litigation. (Comp. at ¶ 20-41.)
It was not until May 16, 2024, that the decision in TMS I was issued.
TMS then filed a motion for summary judgment as to Counts 2-4 of its complaint
acknowledging that Count 1 was rendered moot by TMS I. In its motion, TMS
argued that the decision in TMS I conclusively established a taking for which TMS
is entitled to just compensation. TMS also argued for an injunction, the basis for
which included the demolition of a structure on the Property by the City following
the ruling in TMS I.1
The City filed its own motion for summary judgment and a brief in
opposition to the TMS’s motion for summary judgment, arguing that the zoning
ordinance was not unconstitutional facially or as applied. The City also argued that
the zoning ordinance did not constitute an unconstitutional taking; therefore, a
mandamus action is improper. The City did not address the request for injunction.
1 We note that in March 2026, TMS filed a third case against the City requesting
declaratory judgment and a mandamus action alleging that the City wrongfully demolished a structure on the Property on June 5, 2023. See TMS Ents. Ltd. v. Cleveland, Cuyahoga C.P. No. CV-26-134592.
TMS filed a combined opposition to the City’s motion for summary
judgment and reply in support of its own motion for summary judgment.
On September 3, 2024, TMS submitted a notice of additional exhibit
in support of its reply, which included a document demonstrating the administrative
appeal decided in its favor was a final order. The City filed a reply in support of its
motion for summary judgment.
On October 6, 2025, the trial court granted summary judgment in
favor of TMS as to Counts 2-4 and denied the City’s motion for summary judgment.
The trial court stated, in pertinent part, that
the Ohio Supreme Court has held that “[a]ny direct encroachment
upon land, which subjects it to a public use that excludes or restricts
the dominion and control of the owner over it, is a taking of his
property, for which he is guaranteed a right of compensation by Section
19 of the Bill of Rights.” Norwood v. Sheen (1933), 126 Ohio St. 482,
186 N.E. 102, paragraph one of the syllabus. The Court finds that a
governmental taking has occurred under Article I Section 19 of the Ohio
Constitution for which [TMS] is entitled to just compensation from [the
City].
The United States and Ohio Constitutions guarantee that private
property shall not be taken for public use without just compensation.
Fifth and Fourteenth Amendments to the United States Constitution;
Section 19, Article I, Ohio Constitution. Mandamus is the appropriate
action to compel public authorities to institute appropriation
proceedings where an involuntary taking of private property is alleged.
State ex rel. Shemo v City of Mayfield Heights, 95 Ohio St. 3d 59, citing
State ex rel. Elsass v. Shelby Cty. Bd. of Commrs., 92 Ohio St. 3d at
533, 751 N.E.2d 1032. Relators have the burden of proving their
entitlement to the requested extraordinary relief in mandamus. Elass
at 533. In Shemo the Court outlined the test for mandamus stating,
“This test is disjunctive, i.e., a compensable taking can occur either if
the application of the zoning ordinance to the particular property is
constitutionally invalid, i.e., it does not substantially advance legitimate state interests, or denies the landowner all economically viable use of the land.” State ex rel. Shemo v City of Mayfield Heights, 95 Ohio St. 3d 59 citing Agins v. Tiburon (1980), 447 U.S. 255, 260, 100 S. Ct. 2138, 65 L. Ed. 2d 106. Satisfaction of either prong of the Agins test establishes a taking. . . . “where a regulation places limitation on land that fall short of eliminating all economically beneficial use, a taking nonetheless may have occurred”. Id.
The Court finds that [TMS] has satisfied both prongs of the test for mandamus. The rezoning depleted The Property of its fair market
value and the application of the zoning ordinance is constitutionally invalid as to the property. As such, [the City] has a legal duty to institute appropriation proceedings under the Fifth and Fourteenth Amendments to the United States Constitution; Section 19, Article I, Ohio Constitution. The Court further finds that other than a writ of mandamus there is no adequate remedy for [TMS] in the ordinary
course of law.
The Court finds that a permanent injunction is proper and permanently enjoins [the City] from enforcing The Property’s Multi-Family
Residential District-D2 zoning classification. Further, [the City] and or its agents, officers or departments are permanently enjoined from retaliating against [TMS] or the Property for bringing this litigation.
Judgment is hereby granted in favor of TMS Enterprise, LTD. The
Court declares that [the City] violated [TMS]’s procedural and/or substantive due process rights and [TMS] is entitled to compensation therefore in an amount to be determined at trial. The Court declares that [the City]’s unconstitutional rezoning of The Property significantly and materially diminished the value of the property without due
process of law and without just and reasonable compensation. [TMS] is entitled to just compensation from [the City] for the taking. The Court issues a Writ of Mandamus directing [the City] to institute eminent-domain proceedings pertinent to past, present and continued taking of The Property, so that [the City] will pay [TMS] just
compensation at the trial of these matters. The Court permanently enjoins [the City] from enforcing its unconstitutional rezoning MultiFamily Residential District-D2 zoning classification and prevents [the City] and or its agents, officers or departments from retaliating against [TMS] or the Property for bringing this litigation.
(Opinion and Judgment Entry, Oct. 8, 2025.)
It is from this judgment that the City now appeals.
II. Law and Analysis
In the first and third assignments of error, the City asserts that
summary judgment was improperly granted in favor of TMS and against the City.
Specifically, the City argues that the trial court used the incorrect legal standard to
determine whether there was a compensable taking and that when the correct legal
standard is applied, TMS cannot prevail. In addition, the City argues that TMS had
an adequate remedy at law via the administrative appeal process. According to the
City, summary judgment should have been granted in its favor.
Standard of Review
We review an appeal from summary judgment under a de novo
standard. Cleveland Elec. Illum. Co. v. Cleveland, 2020-Ohio-4469, ¶ 13-15 (8th
Dist.), citing Baiko v. Mays, 140 Ohio App.3d 1, 10 (8th Dist. 2000). Accordingly,
we afford no deference to the trial court’s decision and independently review the
record to determine whether summary judgment is appropriate. Id., citing N.E.
Ohio Apt. Assn. v. Cuyahoga Cty. Bd. of Commrs., 121 Ohio App.3d 188, 192 (8th
Dist. 1997).2
2 TMS argues that the applicable standard of review in a takings case requires that
we review the legal conclusions de novo and the factual findings under a clearly erroneous standard citing State ex rel. OC Lorain Fulton, L.P. v. Cleveland, 2019-Ohio-1531, ¶ 13 (8th Dist.). In Lorain Fulton, this court reviewed the trial court’s denial of a writ of mandamus after a hearing, not after a ruling on summary judgment. Because the trial court in this case ruled on the parties’ motions for summary judgment, we review de novo.
Summary Judgment
The trial court granted summary judgment in favor of TMS as to
Counts 2-4 of the complaint, which included claims for declaratory judgment,
mandamus action, and injunctive relief. In addition, the trial court denied the City’s
motion for summary judgment, as to Counts 1-4.
Civ.R. 56(C) provides that before summary judgment may be granted,
a court must determine that
(1) no genuine issue as to any material fact remains to be litigated, (2)
the moving party is entitled to judgment as a matter of law, and (3) it
appears from the evidence that reasonable minds can come to but one
conclusion and viewing the evidence most strongly in favor of the
nonmoving party, that conclusion is adverse to the nonmoving party.
Civ.R. 56(C) also provides an exclusive list of materials that parties
may use to support a motion for summary judgment:
Summary judgment shall be rendered forthwith if the pleadings,
depositions, answers to interrogatories, written admissions, affidavits,
transcripts of evidence, and written stipulations of fact, if any, timely
filed in the action, show that there is no genuine issue as to any material
fact and that the moving party is entitled to judgment as a matter of
law. No evidence or stipulation may be considered except as stated in
this rule.
The moving party carries the initial burden of setting forth specific
facts that demonstrate his or her entitlement to summary judgment. Dresher v.
Burt, 75 Ohio St.3d 280, 292-293 (1996). If the movant meets this burden, the
burden then shifts to the nonmoving party to provide evidence showing that a
genuine issue of material fact exists. Id. at 293. The nonmoving party cannot simply
rest on its pleadings. Id.
“When assessing cross-motions for summary judgment, each motion
must be considered individually and separately, construing the evidence most
strongly in favor of the party against whom the motion under consideration was
filed. If neither movant is so entitled, both motions must be denied.” State ex rel.
Montgomery v. Ruckman, 2026-Ohio-2671, ¶ 17 (7th Dist.), citing Tatum v.
Dawson, 2023-Ohio-1746, ¶ 5 (7th Dist.).
Declaratory Judgment
In this case, the trial court found that because TMS “had a vested right
in the prior zoning classification, the Multi-Family Residential District-D2 zoning
classification is unconstitutional as applied to the Property.” (Opinion and
Judgment Entry, Oct. 8, 2025.) The trial court further declared that the zoning
classification as applied to the Property constituted a taking and that TMS is entitled
to just compensation from the City.
For purposes of a declaratory-judgment action, a “controversy exists
when there is a genuine dispute between parties having adverse legal interests of
sufficient immediacy and reality to warrant the issuance of a declaratory judgment.”
Wagner v. Cleveland, 62 Ohio App.3d 8, 13 (8th Dist. 1988), citing Burger Brewing
Co. v. Liquor Control Comm., Dept. of Liquor Control, 34 Ohio St.2d 93 (1973).
Writ of Mandamus
The trial court further found that TMS satisfied both prongs of the
test to establish a taking as outlined in Agins v. Tiburon, 447 U.S. 255, 260 (1980),
citing State ex rel. Shemo v. Mayfield Hts., 95 Ohio St.3d 59 (2002). The trial court concluded that the “rezoning depleted the Property of its fair market value and the
application of the zoning ordinance is invalid as to the Property,” the City “has a legal
duty to institute appropriation proceedings,” and that a mandamus action is
appropriate because there is no adequate remedy in the ordinary course of law.
(Opinion and Judgment Entry, Oct. 8, 2025.)
When the government is alleged to have taken property without
providing just compensation, a property owner may institute a mandamus action
for inverse condemnation. State ex rel. Boggs v. Cleveland, 2025-Ohio-5094, ¶ 29,
citing State ex rel. Elsass v. Shelby Cty. Bd. of Commrs., 2001-Ohio-1276, ¶ 21; State
ex rel. Doner v. Zody, 2011-Ohio-6117, ¶ 53. To be entitled to a writ of mandamus
for inverse condemnation, a property owner must establish (1) a clear legal right to
compel the City to commence appropriation, (2) a corresponding legal duty on the
part of the City to institute that action, and (3) the lack of an adequate remedy in the
ordinary course of law. State ex rel. Lora Elias, DDS, Inc. v. Northeast Ohio
Regional Sewer Dist., 2023-Ohio-2182, ¶ 22 (8th Dist.). The appropriate standard
of proof in mandamus cases is that a relator must prove all of the elements necessary
by clear and convincing evidence. State ex rel. Cleveland Right to Life v. State
Controlling Bd., 2013-Ohio-5632, ¶ 2. “Clear and convincing evidence” is a measure
or degree of proof that is more than a preponderance of the evidence but less than
the beyond-a-reasonable-doubt standard required in a criminal case; clear and
convincing evidence produces in the trier of fact’s mind a firm belief of the fact sought to be established. State ex rel. Miller v. Ohio State Hwy. Patrol, 2013-Ohio3720, ¶ 14.
Regulatory Taking
The City maintains that the trial court used the incorrect legal
standard to determine whether there was a compensable taking. The City argues
that the test that was set forth in Penn Cent. Transp. Co. v. New York City, 438 U.S.
104 (1978), is the applicable test and when applied, TMS cannot prevail.
TMS argues that the trial court applied the correct test. And that this
court held in TMS I that “(1) the rezoning never applied to [the Property], and
therefore (2) no variance application or administrative process was ever required.”
(TMS’s brief, p. 17.)3 Therefore, TMS contends that “the City’s wrongful imposition
of an inapplicable re-zoning/regulation” equates to a governmental taking. (TMS’s
brief, p. 17.)
The Takings Clause of the Fifth Amendment to the United States
Constitution, which is applicable to the States under the Fourteenth Amendment,
provides that private property shall not “be taken for public use, without just
compensation.” Likewise, Article 1, Section 19 of the Ohio Constitution provides
3 We disagree with TMS’s characterization of our decision in TMS I. Although this
court held that TMS had a vested right in the preexisting nonconforming use because TMS applied for permits prior to the rezoning ordinance taking effect, this court did not conclude that the rezoning did not apply to TMS, nor did this court find that the variance application or administrate process was not required. Furthermore, TMS I does not stand for the proposition that a vested right in a preexisting nonconforming use automatically equates to a governmental taking. TMS conflates these concepts in the trial court, as well as on appeal. Therefore, we will address the takings issue.
that private property shall not be taken for public use without just compensation.
State ex rel. Shelly Materials v. Clark Cty. Bd. of Commrs., 2007-Ohio-5022, ¶ 16.
A typical example of a taking clause violation that requires just
compensation is direct government appropriation or physical invasion of private
property. State ex rel. AWMS Water Solutions, L.L.C. v. Mertz, 2026-Ohio-1487,
¶ 28, citing Lingle v. Chevron U.S.A. Inc., 544 U.S. 528, 537 (2005). Similarly, the
takings clause may be applied to overly burdensome government regulation of
property “if [the] regulation goes too far.’” Id. quoting Pennsylvania Coal Co. v.
Mahon, 260 U.S. 393, 415 (1922).
In this case, TMS alleged a regulatory taking. The United States
Supreme Court has identified two categories of regulatory action that will be deemed
per se takings for Fifth Amendment purposes. Id. at ¶ 29, citing Lingle at 538. One
such category is when a government regulation causes an owner to suffer “a
permanent physical invasion” of the owner’s property, no matter how minor, the
government must provide just compensation. Id., citing Lingle. A second category
that requires payment of just compensation is when the regulation affects a total or
categorical taking. Id. In other words, when a regulation “‘deprives land of all
economically beneficial use’ unless ‘background principles of the State’s law of
property and nuisance’ independently restrict the owner’s usage.” Id., citing Lucas
v. S.C. Coastal Council, 505 U.S. 1003, 1027, 1029 (1992).
Here, there was no physical invasion of property, nor was the
property deprived of all economically beneficial use. Although TMS asserted that the Property would be “worth basically nothing” if it could not construct and operate
a used car lot, the City set forth evidence that there were numerous other options
available to TMS, including constructing “larger residential units than previously
allowed under the General Retail, Bed and Breakfasts, rooming houses, townhouses,
residential facility, boarding home, dormitories, orphanages, etc.” (City’s Summary
Judgment Motion, Shannan Leonard, Affidavit). Therefore, there is no per se taking
in this case.
“Outside these per se categories, regulatory takings are evaluated
based on the factors described in Penn Cent., 438 U.S. 104.” AWMS at ¶ 30, citing
Shelly Materials, 2007-Ohio-5022, at ¶ 18. Notably, the Ohio Supreme Court has
acknowledged that “whether a governmental regulatory action substantially
advances a legitimate state interest” as set forth in Agins, “is no longer an
appropriate test to evaluate constitutional takings claims.” State ex rel. Gilmour
Realty, Inc. v. Mayfield Hts., 2008-Ohio-3181, ¶ 20. Rather, the Court stated that
the Penn Central test is the appropriate test to determine whether there is a
compensable taking. Id. Therefore, we agree with the City that the trial court used
the incorrect test when deciding whether there was a compensable taking.
Nevertheless, because our review is de novo, we will review the trial
court’s decision to determine whether a genuine issue of material fact remains when
the Penn Cent. test is applied.
“‘Penn Central recognizes an ad hoc, factual inquiry that requires the
examination of the following three factors to determine whether a regulatory taking occurred in cases in which there is no physical invasion and the regulation deprives
the property of less than 100 percent of its economically viable use: (1) the economic
impact of the regulation on the claimant, (2) the extent to which the regulation has
interfered with distinct investment-backed expectations, and (3) the character of the
governmental action. [Penn Cent.] at 124, 98 S.Ct. 2646, 57 L.Ed.2d 631.’” Id.,
quoting Shelly Materials at ¶ 19. Indeed, “[c]ourts have applied the Penn Central
test to claimed partial regulatory-takings cases involving rezoning.” Id. at ¶ 21, citing
e.g., Byrd v. Hartsville, 365 S.C. 650, 657-659 (2005); Reagan v. St. Louis Cty., 211
S.W.3d 104, 107-111 (Mo.App. 2006); Dorman v. Clinton Twp., 269 Mich.App. 638,
646-650 (2006).
We begin with the economic impact of the rezoning as applied to the
Property, and “we note that a loss of market value, without more, does not constitute
a taking.” Lorain Fulton, 2019-Ohio-1531, ¶ 15 (8th Dist.), citing State ex rel.
Anderson v. Obetz, 2008-Ohio-4064, ¶ 68 (10th Dist.), citing State ex rel. BSW Dev.
Group v. Dayton, 83 Ohio St.3d 338, 344 (1998).
In TMS’s motion for summary judgment, Tommy Sullivan, the sole
owner of TMS, attested that, in addition to the purchase price of the Property, he
invested $40,000 into the Property to convert the Property to a used car lot and if
the use variance was denied, the Property would be “virtually useless.” (TMS’s
Summary Judgment Motion, Affidavit of Tommy Sullivan.) TMS also hired a real
estate appraiser who issued an opinion that the market value of the Property was
$94,000 under the general retail classification; however, under the rezoning, the Property’s market value was $11,000. (TMS’s Summary Judgment Motion,
Affidavit and Appraisal.) TMS asserted that the rezoning depleted the Property of
88.3 percent of its fair market value.
The City, on the other hand, set forth evidence that the rezoning only
reduced the Property’s value from $22,000 to $14,000, which is a 36 percent
depletion of its fair market value. (City’s Summary Judgment Motion, Appraisal
Report.) Additionally, Chris Alvardo, the executive director of Slavic Village
Development, testified at the BZA hearing that “residential development [in the
area] is on the uptake,” and that home prices and appraisals increased 50 percent
from 2014 to 2020. (City’s Summary Judgment Motion, BZA tr. 17.)
Here, both parties agree that there was a negative economic impact
triggered by the rezoning that caused the market value of the Property to decrease
in value from 36 percent up to as much as 83 percent. Additionally, TMS provided
uncontested evidence that it spent $40,000 to develop the Property into a used car
lot. Considering the foregoing evidence, we find that the economic impact factor
weighs in favor of TMS.
The second factor a court must consider under Penn Cent. is “‘the
extent to which the regulation has interfered with distinct investment-backed
expectations.’” State ex rel. AWMS Water Solutions v. Mertz, 2020-Ohio-5482,
¶ 57, quoting Shelly Materials, 2007-Ohio-5022, at ¶ 19. “The analysis of this factor
‘is designed to account for property owners’ expectation that the regulatory regime
in existence at the time of their acquisition will remain in place, and that new, more restrictive legislation or regulations will not be adopted.’” AWMS, 2026-Ohio-1487,
at ¶ 42, quoting Love Terminal Partners, L.P. v. United States, 889 F.3d 1331, 1345
(Fed.Cir. 2018). In other words, TMS had to show that it made its investment “‘in
reliance on a state of affairs that did not include the challenged regulatory regime,’”
Id., quoting Loveladies Harbor, Inc. v. United States, 28 F.3d 1171, 1177 (Fed.Cir.
1994). “These expectations must be reasonable.” Id. “The purchase price and the
regulatory regime in place at the time of purchase can reflect the reasonableness of
the property owner’s expectations.” Lorain Fulton, 2019-Ohio-1531, ¶ 17, citing
Murr v. Wisconsin, 582 U.S. 383 (2017).
In this case, the uncontroverted evidence is that TMS, a used car
dealership, purchased the Property at a sheriff’s sale in February 2020. At that time,
the Property was zoned as General Retail, which allowed for a used car lot. Although
a two-story home was on the Property at the time of purchase, the home was
condemned and required demolition. It was not until May 2020 that the rezoning
process began, which was not completed until October 2020, and not effective until
November 2020. (City’s Summary Judgment Motion, Leonard Affidavit.) Further,
this court determined in TMS I, that TMS had a vested right in the prior general
retail zoning classification that allowed the sale of used cars. Based on the
uncontested evidence, TMS had a reasonable investment-backed expectation that it
would be able to operate a used car lot on the Property. Therefore, this factor weighs
in favor of TMS.
Finally, the third factor addresses the character of the government
action at issue. “This factor considers the interference that arises from public
regulation adjusting the benefits and burdens of economic life to promote the
common good.” Lorain Fulton at ¶ 19, citing Penn Cent., 438 U.S. at 124.
Here, the City explained that the purpose of the rezoning was to
remove legacy industrial zoning and general retail designations to align the parcels
in the subject area with the Citywide 2020 Plan and other Small Neighborhood
Plans, which consolidated an assortment of zoning districts to ensure that future
development in the neighborhood is consistent and compatible with adjacent and
nearby residential uses. (City’s Summary Judgment Motion, Leonard Affidavit.)
The rezoning consisted of three phases and was in line with the 2007 Adopted
Citywide Comprehensive Plan. (City’s Summary Judgment Motion, Leonard
Affidavit.) Because this evidence is uncontroverted, we find this factor weighs in
favor of the City.
Nevertheless, both economic factors weigh in favor of TMS and
“[u]ltimately, the Penn Central balancing test is designed to ‘ascertain whether . . .
it is unfair to force the property owner to bear the cost of the regulatory action.’”
AWMS, 2026-Ohio-1487, at ¶ 55, quoting Rose Acre Farms, Inc. v. United States,
559 F.3d 1260, 1282 (Fed.Cir. 2009). Accordingly, we find that there is no genuine
issue of material fact as to whether a taking has occurred; therefore, the trial court
did not err by declaring that a taking occurred.
As discussed previously, when a taking has occurred the property
owner has a clear legal right to compel the City to commence appropriation
proceedings by way of a writ of mandamus. Furthermore, the City has a
corresponding legal duty to institute inverse condemnation proceedings.
Having found that TMS had a clear legal right and the City had a
corresponding legal duty, we address whether there is an adequate remedy at law.
The City cites State ex rel. Gorgievski v. Massillon, 2009-Ohio-4533
(5th Dist.), for its position that TMS had an adequate remedy at law when it appealed
and won its administrative appeal in TMS I. The City argues that the mere existence
of procedural delays in the administrative process does not amount to a taking. We
find Gorgievski distinguishable.
In Gorgievski, appellants were denied a conditional use permit twice.
Appellants were eventually granted the conditional-use permit but only after two
separate administrative appeals. Appellants then filed a writ of mandamus to
institute appropriation proceedings. The trial court granted the City’s motion for
judgment on the pleadings finding that appellants had an adequate remedy at law
via the administrate appeal process. On appeal, the Fifth District affirmed and noted
that “the denial of a conditional use permit was not a compensable ‘taking’ under
the Fifth or Fourteenth Amendments to the United States Constitution. [Because],
a conditional use is not the same as a permitted use. A conditional use is a lesser use
and is not a matter of right.” Id. at ¶ 18, citing Community Concerned Citizens, Inc.
v. Union Twp. Bd. of Zoning Appeals, 66 Ohio St.3d 452 (1993). The Gorgievski Court also noted that “the landowner must prove that the taking deprived all
economically viable uses of the land.” Id.
Unlike the situation in Gorgievski, here “TMS had a vested right in
the prior general retail zoning classification that allowed the sale of used cars.” TMS
I, 2024-Ohio-1888, at ¶ 22. Additionally, when applying the Penn Cent. factors,
TMS established a compensable taking. This was not merely a delay caused by the
administrative process. Both parties agreed that there was a negative economic
impact triggered by the rezoning that caused the market value of the Property to
decrease in value and TMS provided uncontested evidence that TMS spent $40,000
to develop the Property into a used car lot. Furthermore, TMS had a reasonable
investment-backed expectation that it would be able to operate a used car lot on the
Property.
Based on the record in this case, we find that the administrative
appeal for the denial of the change-of-use variance is not an adequate remedy at law
because it does not provide just compensation when, as here, there is a compensable
taking. Therefore, we find that there is no genuine issue of material facts and TMS
was entitled to summary judgment as a matter of law.
Accordingly, the City’s first and third assignments of error are
overruled.
Injunction
In the second assignment of error, the City asserts that the trial court
improperly granted an overly broad and unnecessary injunction that is moot because TMS was granted the change-of-use variance. TMS argues that the City
waived this assignment of error because the City did not contest the injunction in
the trial court. After careful review of the record, we agree with TMS; the City did
not contest the injunction in the trial court.
Indeed, it is well settled that a party cannot raise new arguments and
legal issues for the first time on appeal and that the failure to raise an issue before
the trial court waives that issue for appellate purposes. Cleveland Town Ctr., L.L.C.
v. Fin. Exchange Co. of Ohio, Inc., 2017-Ohio-384, ¶ 28 (8th Dist.); Kalish v. Trans
World Airlines, Inc., 50 Ohio St.2d 73, 79 (1977) (Appellate courts “will not consider
a question not presented, considered, or decided by a lower court.”). In this case,
the City did not address TMS’s request for injunction in its brief in opposition to
TMS’ s summary-judgment motion nor did it address TMS’s injunction in the City’s
summary-judgment motion.
Furthermore, App.R. 16(A)(7) requires that an appellant’s brief
include “[a]n argument containing the contentions of the appellant with respect to
each assignment of error presented for review and the reasons in support of the
contentions, with citations to the authorities, statutes, and parts of the record on
which appellant relies.” Moreover, App.R. 12(A)(2) provides that “[t]he court may
disregard an assignment of error presented for review if the party raising it fails to
identify in the record the error on which the assignment of error is based or fails to
argue the assignment separately in the brief, as required under App.R. 16(A).” The
burden is on the appellant, not the appellate court, to construct the legal arguments necessary to support an appellant’s assignment of error. Doe v. Cuyahoga Cty.
Community College, 2022-Ohio-527, ¶ 25 (8th Dist.), citing Taylor-Stephens v. Rite
Aid of Ohio, 2018-Ohio-4714, ¶ 121 (8th Dist.). Appellate courts are not advocates.
Id. Thus, we will not consider the City’s arguments regarding the injunction.
Accordingly, the City’s second assignment of error is overruled.
Judgment affirmed.
It is ordered that appellees recover from appellant costs herein taxed.
The court finds there were reasonable grounds for this appeal.
It is ordered that a special mandate be sent to said court to carry this judgment
into execution.
A certified copy of this entry shall constitute the mandate pursuant to Rule 27
of the Rules of Appellate Procedure.
MARY J. BOYLE, PRESIDING JUDGE
SEAN C. GALLAGHER, J., and
DEENA R. CALABRESE, J., CONCUR