Oral Argument Preview: Does Failure to Name All Interested Parties in the Notice of Appeal from an Unemployment Compensation Decision Divest the Trial Court of Subject Matter Jurisdiction? Marcus H. Pryor II v. Director, Ohio Department of Job and Family Services.

Update: On May 11, 2016, the Supreme Court of Ohio handed down a merit decision in this case. Read the analysis here.

Read an analysis of the oral argument in this case here.

On January 27, 2016, the Supreme Court of Ohio will hear oral argument in the case of Marcus H. Pryor II v. Director, Ohio Department of Job and Family Services, 2015-0770. At issue in this case is whether the failure to name all interested parties in the notice of appeal from an unemployment compensation decision divests the trial court of subject matter jurisdiction.The court accepted the case on both conflict certification and discretionary appeal, and consolidated the two.

The certified question is this:

“When appealing an unemployment compensation decision to the trial court, are the requirements contained in R.C. 4141.282(D), which explains how to name the parties, mandatory requirements necessary to perfect the appeal and vest the trial court with jurisdiction?”

Conflict Cases:

Dikong v. Ohio Supports, Inc., 2013-Ohio-33 (1st Dist.)

Mattice v. Ohio Dept. of Job & Family Servs., 2013-Ohio-3941 (2nd Dist.)

Rupert v. Ohio Dept. of Job & Family Servs., 2015-Ohio-915 (6th Dist.)

Hinton v. Unemp. Rev. Comm., 2015-Ohio-1364 (7th Dist.)

Luton v. Unemp. Rev. Comm., 2012-Ohio-3963 (8th Dist.)

Sydenstricker v. Donato’s Pizzeria, L.L.C., 2010-Ohio-2953 (11th Dist.)

Case Background

Marcus Pryor served as a combat medic and was honorably discharged from the United States Army. Pryor then applied for and was granted unemployment benefits. However, the Director of the Ohio Department of Job and Family Services (“Director”) subsequently reversed this decision. A clerical error in the paperwork ultimately resulted in the overpayment of benefits to Pryor. The Unemployment Compensation Review Commission denied Pryor’s application for unemployment benefits and ordered him to pay back all benefits improperly received.

Pryor timely appealed to the Summit County Court of Common Pleas, and instructed the clerk to serve the complaint on the Director of ODJSF and the Department of the Army, but did not name the Department of the Army in his notice of appeal. Because of the failure to list all “interested parties,” the trial court dismissed Pryor’s motion for lack of subject matter jurisdiction. Pryor appealed this decision to the Ninth District Court of Appeals. In a unanimous opinion penned by Judge Carr, and joined by Judges Moore and Hensal, the Ninth District found that the plain language of the relevant statute vests jurisdiction in a trial court so long as a timely appeal is filed, and any defects in the notice could be addressed by the appropriate rules of civil procedure. The appeals court acknowledged its decision conflicted with those of a number of courts of appeals, and certified a conflict.

Key Precedent

R.C. 4141.282 (Statute instructing the requirements for appeal of an unemployment commission finding. Of significant importance to this case are Subsection C, Perfecting the Appeal (The timely filing of the notice of appeal shall be the only act required to perfect the appeal and vest jurisdiction in the court. The notice of appeal shall identify the decision appealed from) and the Party-Naming Requirements in Subsection (D) (The commission shall provide on its final decision the names and addresses of all interested parties. The appellant shall name all interested parties as appellees in the notice of appeal. The director of job and family services is always an interested party and shall be named as an appellee in the notice of appeal.))

Zier v. Bur. of Unemp. Comp., 151 Ohio St. 123, (1949) (An appeal based on a statute can only be perfected in the mode prescribed by the statute. Under earlier version of unemployment compensation appeal statute, party-naming non-jurisdictional.)

Shinkle v. Ashtabula Cty. Bd. of Revision, 2013-Ohio-397 (The case law has usually treated a statutory requirement as mandatory and hence jurisdictional when the requirement is (1) imposed on the appellant itself and (2) relates to the informative content by which the administrative proceeding is instigated)

Spencer v. Freight Handlers, Inc., 2012-Ohio-880 (Statutory requirements that a party appealing from an Industrial Commission order name the administrator of the Bureau of Workers’ Compensation as a party to the appeal and serve the administrator with the notice of appeal are not jurisdictional requirements.)

Director’s Argument

The requirement in R.C. 4141.282 that parties be named in an unemployment compensation appeal is a jurisdictional requirement.

First, the omission of an employer entitled to notice under R.C. 4141.282 invariably creates a jurisdictional defect. Specifically, subsection (D) requires that all interested parties be named—something Pryor failed to do. The statute, in its entirety, is what guides a proper appeal. Without properly given notice to an interested party, jurisdiction does not vest. The Ninth District erred when it isolated the remaining subsections of the statute and focused solely on subsection (C). As other appeals courts have determined, every requirement, including party-naming, prescribed by R.C. 4141.282 must be strictly complied with for jurisdiction to vest.

Second, there are practical considerations for this interpretation of 4141.282. Strict compliance with all requirements is necessary for jurisdiction to vest, or else appellants could cherry pick which requirements they feel like complying with. The dangerous result of the Ninth District decision also could potentially affect the rights of unnoticed interested parties, and threatens the smooth functioning of appeals.

Third, the appeals court mistakenly relied on the fact that the party-naming requirement is in a separate section of the statute in finding that requirement non-jurisdictional. Furthermore, Zier’s holding (not the result) actually cuts in favor of the Director. The grounds requirement relevant to that case was a jurisdictional requirement, just like R.C. 4141.282 is now. When the General Assembly amended the statute in 2001, its intent was to override the regime in which various requirements were non-jurisdictional, and to establish that content requirements, including the party-naming requirement, are jurisdictional. Finally, the civil rules are not a proper avenue for remedy, as they are not applicable to the issues raised by R.C. 4141.282.

Pryor’s Argument

First, Pryor focuses on the plain language of R.C.4141.282 (C) which clearly states that the timely filing of the notice of appeal is “the only act required to perfect the appeal and vest jurisdiction.” The general rules that govern statutory interpretation demand that the court rely on what the General Assembly has said when the language is clear and unambiguous. Therefore, since Pryor complied with subsection (C), jurisdiction vested.

Second, the court has never determined that the naming of parties in an unemployment appeal is a jurisdictional requirement. Heavily relying on Zier, Pryor asserts that a naming imperfection does not render jurisdiction defective. The substance of R.C. 4141.282 is the same as when Zier was decided. The rationale driving the decision then should not change now because of minor differences in the amended statute. The statute, in its current form, merely instructs how an appellant should name the interested parties. It should not override subsection (C)’s clear language.

Third, the Civil Rules do apply in this case. These rules allow for parties to be dropped or added at any point in the proceedings, and allow a party to move for a dismissal under Civ. R. 12(B) (7) or Civ. R. 19 if necessary parties have not been joined. However, this does not impact whether or not the court has jurisdiction. When boiled down, Pryor complied with 4141.282(C) and therefore jurisdiction should have been vested in the trial court. While the appeal may still fail on other grounds, there is not a jurisdictional defect in Pryor’s appeal.

Also, the statutory requirements are directory instead of mandatory when looking to the Shinkle test. This two-prong test first looks to see if the requirement was (1) imposed on the appellant itself and (2) the informative content by which the administrative proceeding is instigated. The statutory requirement fails at the first prong because there is an obligation on both the commission and appellant (the unemployment commission must provide the names and addresses of all interested parties.) As to the second prong, while content requirements are jurisdictional, naming requirements are not content requirements. While failure to name and notify the administrator would subject an appeal to dismissal, naming and notifying the administrator are not jurisdictional requirements.

Finally, under the substantial compliance doctrine, this appeal should survive. Pryor timely filed his appeal, identified the decision being appealed, named the Director in the notice, served the notice on all interested parties, and filed an amended notice naming the Army. As such, Pryor substantially complied with the statute and the trial court should have asserted jurisdiction.

Director’s Proposed Proposition of Law

In an unemployment compensation administrative appeal, R.C. 4141.282(D)’s mandate that the “appellant shall name all interested parties as appellees in the notice of appeal” is a jurisdictional requirement, so a defective notice of appeal fails to vest jurisdiction in a common pleas court.

Pryor’s Proposed Counter Proposition of Law I

In an unemployment compensation appeal, the statutory requirement to name parties pursuant to R.C. 4141.282(D) is not a jurisdictional requirement necessary to perfect the appeal and vest the trial court with jurisdiction.

Pryor’s Proposed Counter Proposition of Law II

The right to appeal an unemployment decision to the common pleas court can be perfected only in the manner provided by the statute in R.C. 4141.282, and, absent substantial compliance with the statute, the reviewing body lacks jurisdiction to review the Review Commission’s final decision.

Amici in Support of Pryor

Ohio Legal Services (OLS), representing various legal services programs from around Ohio, filed a brief on behalf of Pryor. The overarching concept propelling OLS’s brief was court access. Ultimately, this hinges on access to justice and the courts that all citizens should enjoy when their rights are infringed, affected, or limited. Additionally OLS submits its own proposed proposition of law: “In an unemployment compensation administrative appeal, R. C 4141.282(C) only requires the timely filing of the notice of appeal identifying the decision appealed from to vest jurisdiction with the court and perfect the appeal, therefore, the requirement to name all “interested parties ” in the notice of appeal pursuant to 4141.282(D) is non-jurisdictional.” Mirroring the argument from Pryor, OLS argues that the plain language of R.C. 4141.282 unquestionably vests jurisdiction in a trial court when an appellant files a timely appeal.

Student Contributor: Austin LiPuma

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