Notable Items:
Parties cannot vest a court with subject-matter jurisdiction by agreement.
Appellant: Cheap Escape Co., Inc. dba JB Dollar Stretcher
Appellee: Haddox, LLC. Jeffrey L. Tessman
Venue: Ohio Supreme Court
Material Facts:
- Haddox, a construction firm located in Summit County, entered into two contracts with Cheap Escape to run ads in this magazine.
- Contracts contained a clause "in the event of noncompliance ... the proper venue for litigation will the Frankin County Municipal Court ....
- Haddox allegedly defaulted on the agreements.
- All events occurred outside of Franklin County.
- A full recounting of the facts is available below
Procedural History:
- Cheap Escape fjiled a breach-of-contract action against Haddox and Tessman in Franklin County Municipal Court seeking $1,984 in damages.
- Neither defendant filed a response pleading.
- Municipal Court entered a default judgement for Cheap Escape
- Approximately 11 months later, Tessman moved to vacant the default judgement arguing that Franklin County Municipal Court lacked subject-matter jurisdiction.
- Court of Appeals reversed the municipal court decision and remanded the case for dismissal.
- Cheap Escape brought the case to the Ohio Supreme Court.
Appellant's Claim(s):
Appellant claims "original jurisdiction within its territory" means over any statutorily prescribed action, regardless of where the underlying events occurred.
Issues:
Does the municipal court have subject-matter jurisdiction over matters lacking connections to their geographical territories ...?
Holding(s) and Disposition:
Held: No. Franklin County Municipal Court lacked subject-matter jurisdiction because the parties do not have territorial connections.
Litigants cannot vest a court with subject-matter jurisdiction by agreement.
Disposition: not stated
Rationale
Majority Opinion
- Jurisdiction must be demonstrated for the municipal court to hear the case.
- Municipal court were created by statute which gives the municipal court original jurisdiction within its territory in all the following actions...breach-of-contract cases....
- We find the statute to be ambiguous.
- Because "within its territory" does not refer to the areas in which a municpal court may sit, the only other logical way to read the phrase is a a limit on the types of actions that a court may hear.
- Therefore, the municipal court may hear only those matters that have a territorial connection to the court.
- Therefore, we hold that R.C. 1901.18(A) limits municipal court subject-matter jurisdiction to actions or proceedings that have a territorial connection to the court.
- A full description of the rationale is available below
Full Recounting of Facts
- Cheap Escape produces a magazine that feature business advertisements.
- Haddox, a construction firm located in Summit County, entered into two contracts with Cheap Escape to run ads in this magazine.
- Contracts contained a clause "in the event of noncompliance ... the proper venue for litigation will the Frankin County Municipal Court ....
- Haddox allegedly defaulted on the agreements.
- All events occurred outside of Franklin County.
- A list of the material facts is available above
Majority Full Argument
- Jurisdiction must be demonstrated for the municipal court to hear the case.
- Both parties agree that Franklin County Municipal Court had territorial jurisdiction (located in Franklin County) [how so?], monetary juridiction (less than $15,000), and personal jurisdiction, they disagree regarding subject-matter jurisdiction.
- Municipal court were created by statute which gives the municipal court original jurisdiction within its territory in all the following actions...breach-of-contract cases....
- Appellant claims "original jurisdiction within its territory" means over any statutorily prescribed action, regardless of where the underlying events occurred.
- Appellee argues that the phrase "original jurisdiction within its territory" limits subject-matter jurisdiction to those actions with a territorial connection to the court (occurred within the territory).
- We find the statute to be ambiguous.
- Using traditional methods of statutory interpretation, review in pari materia, read all statutes relating to the same general subject matter together.
- Appellant's interpretation would make the phrase "in its territory" mere Need entry for
.
- Because "within its territory" does not refer to the areas in which a municpal court may sit, the only other logical way to read the phrase is a a limit on the types of actions that a court may hear.
- Therefore, the municipal court may hear only those matters that have a territorial connection to the court.
- Therefore, we hold that R.C. 1901.18(A) limits municipal court subject-matter jurisdiction to actions or proceedings that have a territorial connection to the court.
- Parties involved admittedly did not have territorial connections to the Franklin County Municipal Court, the court lacked subject-matter jurisdiction.
- Litigants cannot vest a court with subject-matter jurisdiction by agreement.
- The core of the rationale is available above