Opinion
No. 39933
Decided July 6, 1966.
Taxpayer's action — Section 733.56 et seq., Revised Code — Action against city, claiming abuse of corporate powers — Application for attorney's fees taxed as costs — Section 733.61, Revised Code — Discretion of court in allowing fees — Facts to be considered — Creation or preservation of fund — Protection of private or public rights.
APPEAL from the Court of Appeals for Cuyahoga County.
An action was brought in the Common Pleas Court of Cuyahoga County by the plaintiff as a taxpayer, as provided for in Sections 733.56 to 733.59, Revised Code. The question of whether the act of the city of Cleveland concerning which complaint was made in the petition constituted an "abuse of its corporate powers" within the meaning of these sections was raised in the trial court by a demurrer to the second amended petition. That court sustained the demurrer. An appeal was taken by the plaintiff from that order. The Court of Appeals reversed the judgment and remanded the cause for trial upon the merits.
After a trial during which the same issue was raised, the court entered judgment for the defendants. From that judgment an appeal was taken. The Court of Appeals reversed the judgment of the Common Pleas Court and entered final judgment for the plaintiff. No appeal was taken from that final order.
As a result of final judgment being rendered in her favor, plaintiff applied to the trial court for an allowance of attorney fees as provided in Section 733.61, Revised Code. Defendant city of Cleveland objected, again asserting that the action was not a proper taxpayer's suit, additionally claiming that attorney fees may not be awarded and taxed as costs in such an action against a municipal corporation (1) where no fund was created, preserved or saved as a result of the taxpayer's successful prosecution of her action and (2) where there was no showing that the success of the action to enjoin the municipality was of any substantial benefit to municipal taxpayers generally.
The trial court, overruling all these objections, allowed fees in the amount of $4,900. The Court of Appeals affirmed the award.
The cause is before this court pursuant to the allowance of a motion to certify the record.
Mr. Henry DuLaurence, Messrs. Van Aken, Whiting, Arnold, Bond Withers, Mr. William Van Aken, Mrs. Esther Rice Battenfeld, Mr. Joseph L. Abrams and Mr. Paul H. Oppmann, for appellee.
Mr. Bronis J. Klementowicz, director of law, Mr. Daniel J. O'Loughlin, Mr. Richard J. Marco and Mr. James P. Mancino, for appellants.
Although taxpayers' suits are recognized in equity, there is no authority for the allowance of attorney fees as costs in such cases unless a fund is created or preserved. 5 A.L.R. 2d 874, 877.
Section 733.61, Revised Code, specifically authorizes that fees be allowed plaintiff's counsel and taxed as costs if judgment is finally ordered in plaintiff's favor in an action brought for an injunction when the city has refused to file the action after being requested to do so (Section 733.59, Revised Code). That statute does not require that a fund be either created or preserved as a prerequisite to an allowance of fees.
If an action might have been filed by the city solicitor his refusal to do so clearly gives a derivative action to a taxpayer. It is reasonably arguable that Section 733.61, Revised Code, may permit the fee of plaintiff's counsel to be allowed and taxed as costs without regard to a fund.
The threatened acts constitute an abuse of corporate power, and the Director of Law was given authority to file such an action by Section 733.56, Revised Code.
There is no denial that the plaintiff made the request required by the statute, and that action by the Director of Law was refused.
This court's holding in State, ex rel. Scott, v. Masterson, 173 Ohio St. 402, does not lay down the rule that counsel fees cannot be allowed to a taxpayer unless a fund has been created or preserved. It does, however, indicate that the fact that a fund is not created or preserved is one of the things to be considered by a court in exercising its discretion in the matter of the allowance of such fees.
In the instant case, we find other circumstances present which were apparently not considered by the court at the time of the hearing in this matter and which should always be considered when the discretionary matter of the allowance of fees is reached. We observe that the rights protected were private rights as opposed to public rights. The action filed was primarily for the benefit of the plaintiff's own interests. No public money or property is involved. The sole purpose of the action was to prevent the municipality from requiring payment of fees by a limited class of property owners, of which plaintiff is a member.
The statute which allows fees directs the court to make such order as the equity of the case demands. It would be inequitable to pay the plaintiff's counsel with public funds in a case in which the public obtains no benefit.
The remedies readily available to the plaintiff in her individual rather than her representative capacity in this case were entirely adequate to protect her interests.
In view of the foregoing, the order allowing plaintiff an attorney fee and taxing it as costs constitutes an abuse of discretion.
The judgment is, therefore, reversed.
Judgment reversed.
TAFT, C.J., ZIMMERMAN, MATTHIAS, O'NEILL, HERBERT, SCHNEIDER and BROWN, JJ., concur.