Opinion
22AP-548
07-13-2023
Dean Eckley, Appellant-Appellant, v. Ohio State Racing Commission, Appellee-Appellee.
Graff &McGovern, L.P.A., and Brandon M. Smith, for appellant. Brandon M. Smith. Dave Yost, Attorney General, and Todd K. DeBoe, for appellee. Todd K. DeBoe.
APPEAL from the Franklin County Court of Common Pleas C.P.C. No. 22CV-2003
On brief:
Graff &McGovern, L.P.A., and Brandon M. Smith, for appellant.
Argued:
Brandon M. Smith.
On brief:
Dave Yost, Attorney General, and Todd K. DeBoe, for appellee.
Argued:
Todd K. DeBoe.
DECISION
BEATTY BLUNT, P.J.
{¶ 1} Appellant-appellant, Dean Eckley, appeals from a judgment of the Franklin County Court of Common Pleas affirming an order of appellee-appellee, the Ohio State Racing Commission (the "Commission"), denying appellant's application for a standardbred trainer license. (Aug. 11, 2022 Decision &Entry.) For the reasons that follow, we affirm.
I. Facts and Procedural History
{¶ 2} On January 7, 2021, appellant submitted an Ohio State Racing Commission License Application for 2021 as a standardbred trainer. The Commission investigated the matter and on May 14, 2021, the Commission issued a notice of opportunity for hearing wherein appellant was notified that the Commission intended to deny appellant's application.
{¶ 3} Appellant requested a hearing, and on September 24, 2021 a commission hearing officer conducted a hearing. Appellant was represented by counsel and testified on his own behalf. The Commission's Deputy Director and Chief Legal Counsel testified on behalf of the Commission. The Commission offered seven exhibits. Appellant objected to the admission of Exhibit F5, a copy of a newspaper article regarding appellant's 2010 arrest in New York for abusing a racehorse, on the basis of improper authentication. Appellant also objected to Exhibit G, which lists various rulings by the Pennsylvania State Harness Racing Commission ("Pennsylvania") finding him in violation of Pennsylvania racing rules and imposing fines and suspensions. Appellant's objection to Exhibit G was premised on his assertion that the Pennsylvania rulings are irrelevant to his application because they are older than the five-year "look back" period pertinent to the Commission's consideration of his application. Over appellant's objections, the hearing officer admitted the exhibits.
{¶ 4} On October 21, 2021, the hearing officer issued her Findings of Fact and Conclusions of Law/Report and Recommendation ("Report and Recommendation"). The Report and Recommendation stated, in pertinent part
Testimony and the Exhibits have shown that Respondent has had his 2017 Pennsylvania license suspended from May 30, 2018 until January 1, 2021. The period of suspension by Pennsylvania is within the Application five (5) year look back. Respondent is in violation of Ohio Adm. Code 3769-12-26(A)(2).
Testimony and the Exhibits have shown that Respondent failed to report the charge of animal cruelty for which he was arrested on his Application. He also did not explain the severity of this penalty for the two offenses listed on the Application. Although the Pennsylvania suspension had expired and Pennsylvania had issued Respondent a conditional license, none of that part of Respondent's history appears in the Application. Respondent is in violation of Ohio Adm. Code 3769-12-26(A)(7).
* * *
The most recent actions of the Respondent as detailed in the testimony and Exhibits admitted into evidence show that the Respondent has engaged in conduct against the best interest of horse racing in violation of Ohio Adm. Code 3769-2-26(A)(10).(Report and Recommendation at 7-8.) The hearing officer recommended "that the decision to deny [appellant] an owner/trainer license with the Ohio State Racing Commission be upheld." Id. at 8.
{¶ 5} Appellant timely filed objections to the Report and Recommendation. On February 23, 2022 the Commission considered the Report and Recommendation and appellant's objections at its regular meeting where appellant also appeared. The Commission adopted the Report and Recommendation by unanimous vote at its meeting. On March 14, 2022, the Commission issued an Adjudication Order adopting the Report and Recommendation and denying appellant's application for a standardbred owner and trainer license. (Mar. 14, 2022 Adjudication Order.)
{¶ 6} On March 29, 2022, appellant timely appealed the Commission's order to the Franklin County Court of Common Pleas. On August 11, 2022, the trial court issued its decision and entry affirming the order of the Commission, finding that the order was supported by reliable, probative, and substantial evidence and was in accordance with the law.
{¶ 7} This timely appeal followed.
II. Assignments of Error
{¶ 8} Appellant asserts the following assignments of error for our review:
[I.] The lower court abused its discretion when it determined that the Commission did not violate Mr. Eckley's Due Process rights and that the Order was in accordance with law.
[II.] The lower court abused its discretion when it determined that the Commission proved Mr. Eckley failed to make required disclosures and the Order was based on reliable, probative, and substantial evidence.
III. Law and Analysis A. Standard of Review
{¶ 9} In an administrative appeal brought pursuant to R.C. 119.12, the common pleas court must consider the entire record to determine whether reliable, probative, and substantial evidence supports the agency's order and whether the order is in accordance with law. Univ. of Cincinnati v. Conrad, 63 Ohio St.2d 108, 110-11 (1980). Reliable, probative, and substantial evidence has been defined as follows:
(1) "Reliable" evidence is dependable; that is, it can be confidently trusted. In order to be reliable, there must be a reasonable probability that the evidence is true. (2) "Probative" evidence is evidence that tends to prove the issue in question; it must be relevant in determining the issue. (3) "Substantial" evidence is evidence with some weight; it must have importance and value.Our Place, Inc. v. Ohio Liquor Control Comm., 63 Ohio St.3d 570, 571 (1992).
{¶ 10} The common pleas court's" 'review of the administrative record is neither a trial de novo nor an appeal on questions of law only, but a hybrid review in which the court "must appraise all the evidence as to the credibility of the witnesses, the probative character of the evidence, and the weight thereof." '" Edmands v. State Med. Bd., 10th Dist. No. 16AP-726, 2017-Ohio-8215, ¶ 10, quoting Lies v. Ohio Veterinary Med. Bd., 2 Ohio App.3d 204, 207 (1st Dist.1981), quoting Andrews v. Bd. of Liquor Control, 164 Ohio St. 275, 280 (1955). The trial court "must give due deference to the administrative resolution of evidentiary conflicts," although "the findings of the agency are by no means conclusive." Conrad at 111. The common pleas court conducts a de novo review of questions of law, exercising its independent judgment in determining whether the administrative order is "in accordance with law." Ohio Historical Soc. v. State Emp. Relations Bd., 66 Ohio St.3d 466, 471 (1993), citing R.C. 119.12.
{¶ 11} By contrast, an appellate court's review of an administrative decision is more limited than that of the common pleas court. Pons v. Ohio State Med. Bd., 66 Ohio St.3d 619, 621 (1993). The appellate court is to determine only whether the common pleas court abused its discretion. Id.; Lorain City School Dist. Bd. of Edn. v. State Emp. Relations Bd., 40 Ohio St.3d 257, 261 (1988). A trial court abuses its discretion when it exercises its judgment in an unwarranted way regarding a matter over which it has discretionary authority. Johnson v. Abdullah, 166 Ohio St.3d 427, 2021-Ohio-3304, ¶ 35. The term abuse of discretion," 'commonly employed to justify an interference by a higher court with the exercise of discretionary power by a lower court, implies not merely error of judgment, but perversity of will, passion, prejudice, partiality, or moral delinquency.'" Id., quoting Black's Law Dictionary 11 (2d Ed.1910). Absent an abuse of discretion, this court may not substitute its judgment for that of the administrative agency or the trial court. Pons at 621. However, on the question of whether the agency's order was in accordance with the law, this court's review is plenary. Kistler v. Ohio Bur. of Workers' Comp., 10th Dist. No. 04AP-1095, 2006-Ohio-3308, ¶ 9.
B. Discussion
{¶ 12} The Supreme Court of Ohio has observed "that horse racing is one of those fields subject to extraordinarily broad regulatory powers." O'Daniel v. Ohio State Racing Comm., 37 Ohio St.2d 87, 93 (1974)." 'The very nature of horse racing itself presents numerous opportunities for abuse. Specific and strict rules are necessary in order to preserve the integrity of the sport. Persons who wish to receive licenses to participate in the sport must conform to certain standards, rules and regulations, which are designed to maintain the integrity of horse racing.'" Burneson v. Ohio State Racing Comm., 10th Dist. No. 03AP-925, 2004-Ohio-3313, ¶ 38, quoting Haehn v. Ohio State Racing Comm., 83 Ohio App.3d 208, 213 (10th Dist.1992)." 'Horse racing and legalized wagering thereon, are subjects with respect to which police regulations for the protection of the public safety, morals, and general welfare, are not only proper but are an absolute necessity.'" Thomas v. Ohio State Racing Comm., 10th Dist. No. 08AP-804, 2009-Ohio-1559, ¶ 16, quoting Standard "Tote," Inc. v. Ohio State Racing Comm., 68 Ohio Law Abs. 19, 121 N.E.2d 463, 469 (1954).
{¶ 13} The enabling legislation governing horse racing is promulgated in Chapter 3769 of the Ohio Revised Code. R.C. 3769.02 establishes the Commission. "The Commission, which consists of five members appointed by the governor, is vested with broad regulatory authority over horse racing." State ex rel. Hodkinson v. Ohio State Racing Commn., 10th Dist. No. 18AP-931, 2020-Ohio-4073, ¶ 5, citing R.C. 3769.02; R.C. 3769.03. R.C. 3769.03 empowers the Commission to "prescribe the rules and conditions under which horse racing may be conducted." The statute further provides that the commission "may issue, deny, suspend, or revoke licenses to those persons engaged in racing and to those employees of permit holders as is in the public interest for the purpose of maintaining a proper control over horse-racing meetings." R.C. 3769.03.
{¶ 14} Under the authority granted by R.C. 3769.03, the Commission promulgated Ohio Adm.Code 3769-12-26(A), which provides, in pertinent part:
The commission may refuse to grant * * * any license [to] a person to whom any of the following apply: * * *
(2) The applicant or licensee has had a license of the legally constituted racing authority of any state, province or nation, denied, suspended or revoked for cause within the preceding five years; * * *
(4) The applicant or licensee has violated or attempted to violate any provision of Chapter 3769. of the Revised Code or the Ohio rules of racing; * * *
(7) The applicant or licensee has made any material misrepresentation in his or her application for license; * * *
(10) The applicant or licensee has engaged in conduct which is against the best interest of horse racing.(Emphasis added.) The power of the Commission to approve or reject a license application is discretionary, not mandatory. Raceway Park, Inc. v. Ohio State Racing Comm., 10th Dist. No. 02AP-352, 2002-Ohio-5615, ¶ 12.
{¶ 15} This is an administrative appeal, so the issue before this court distills to whether the common pleas court abused its discretion in affirming the Commission's decision as "supported by reliable, probative, and substantial evidence," and whether the Board's determination was in accordance with law. As explained below, the trial court did not abuse its discretion in affirming the Commission's decision, and the Board's determination was in accordance with law.
{¶ 16} In his first assignment of error, appellant contends that the trial court abused its discretion when it determined that the Commission did not violate his due process rights and that the order was in accordance with law. Appellant contends the Commission violated his due process rights in two ways: one, by introducing Exhibits G and G-1 through G-5 over objection at the September 24, 2022 hearing before the hearing examiner; and two, by raising and considering information regarding the "Fishman case" at the February 23, 2022 meeting when considering appellant's objections to the October 21, 2021 Report and Recommendation. Neither contention has merit.
{¶ 17} Exhibits G and G-1 through G-5 consist of Pennsylvania State Harness Racing Commission Rulings pertaining to various suspensions and fines, some of which date back to 2014. Appellant objected to the admission and consideration of this information, asserting that they related to discipline beyond the "five-year look back" period set forth in Ohio Adm.Code 3769-12-26(A)(2) and he was not given notice that these disciplinary records would be considered. But the Commission did not base its decision, even in part, on any of these older violations. Indeed, the Report and Recommendation adopted by the Commission in its March 14, 2022 adjudication order only references appellant's "more recent actions" as showing he engaged in conduct against the best interest of horse racing in violation of Ohio Adm.Code 3769-2-26(A)(10). Furthermore, even if the Commission had specifically pointed to these older disciplinary actions as being against the best interest of horse racing, appellant cannot show this is prejudicial to him in any way because the other violations specified in the Report and Recommendation would alone be sufficient to deny his application-which appellant does not and cannot deny. The admission of Exhibits G and G-1 through G-5 did not violate appellant's right to due process.
We observe that although both the trial court and the Commission assert that appellant did not object to the admission of these exhibits at the hearing, and thus this argument is waived, the record shows that he did so object. (See, Oct. 21, 2021 Report and Recommendation, Findings of Fact No. 14.)
We also note that generally, administrative agencies are" 'not bound by the strict rules of evidence applied in court.'" Katsande v. Ohio Dept. of Medicaid, 10th Dist. No. 19AP-375, 2020-Ohio-5488, ¶ 30, quoting Westlake v. Ohio Dept. of Agriculture, 10th Dist. No. 08AP-71, 2008-Ohio-4422, ¶ 19, citing Haley v. Ohio State Dental Bd., 7 Ohio App.3d 1, 6, 7 (2d Dist.1982).
{¶ 18} Similarly, the information regarding the "Fishman case" was only briefly raised by one of the Commissioners at the February 23, 2022 meeting when considering Appellant's objections, and there is no mention of the "Fishman case" in the Report and Recommendation. When the Commissioner' unanimously voted to adopt the Report and Recommendation they did so without any sort of amendment to include information regarding the "Fishman case," and thus the Commission's order is in no way based on that case. Furthermore, as with the Exhibits G and G-1 through G-5 discussed above, even if the Fishman case information had contributed in some way to the Commission's decision to adopt the Report and Recommendation denying appellant's application, appellant cannot show that this was prejudicial because other independent bases for denial also existed. The Commission's brief discussion and questioning on the "Fishman case" at the hearing on the objections did not violate appellant's rights to due process.
{¶ 19} Therefore, based on the foregoing, we find the trial court did not abuse its discretion in finding that the Commission did not violate appellant's due process rights. Accordingly, appellant's first assignment of error is overruled.
{¶ 20} In his second assignment of error, appellant asserts that the trial court abused its discretion in determining that appellant failed to disclose all required information on his application and that the Commission's order was supported by reliable, probative, and substantial evidence. This assignment of error is without merit.
{¶ 21} The evidence submitted in the form of testimony of both the Commission's Deputy Director and Legal Counsel and that of appellant amply supports the basis upon which the Commission denied appellant's application. Specifically, the evidence showed four distinct violations of the Ohio Administrative Code pertaining to horse racing licenses as follows.
{¶ 22} One, appellant's 2017 Pennsylvania license was suspended from May 30, 2018 until January 1, 2021. This period of suspension was clearly within the five-year "look back" period in violation of Ohio Adm.Code 3769-12-26(A)(2). Therefore, reliable, probative, and substantial evidence supports this finding and the Commission had discretion to deny his license application on this basis alone.
{¶ 23} Two, although it is technically accurate that the foregoing suspension followed a voluntary surrender of appellant's license, the evidence shows that the surrender was negotiated to resolve an immediately receding suspension imposed for failure to comply with a subpoena issued by the Pennsylvania State Horse Racing Commission. Although appellant testified at the hearing that he did not believe he needed to disclose this suspension because it was a voluntary surrender (versus a technical suspension), reliable, probative, and substantial evidence supports the Commission's position that failing to disclose this information on his application was a material misrepresentation in violation of Ohio Adm.Code 3769-12-26(A)(7).
{¶ 24} Additionally, the evidence shows that appellant failed to disclose that upon reinstatement of his license in February, 2021, the Pennsylvania State Horse Racing Commission issued a conditional license based upon an agreement between appellant and the Pennsylvania authorities. Again, reliable, probative, and substantial evidence supports the Commission's position that failure to disclose the fact of his conditional license on his application was a material misrepresentation in violation of Ohio Adm.Code 3769-12-26(A)(7). Therefore, the Commission had discretion to deny appellant's license application on the foregoing violations alone.
{¶ 25} Three, although appellant did list on his application two suspensions of his Pennsylvania license occurring in March, 2016 and August, 2016 based on illicit drugs found in horses appellant was training, he failed to provide details of the severity of the suspensions, such as the fines and aggravating circumstances, despite that the application specifically required that particulars be provided for any license suspensions. Indeed, for one of the two drug violation suspensions, appellant was fined $3500.00, and his license was placed in conditional status for five years. The record shows that reliable, probative, and substantial evidence fully supports the Commission's finding that failure to disclose the details of these two suspensions constituted a material misrepresentation in violation of Ohio Adm.Code 3769-12-26(A)(7). Therefore, the Commission had discretion to deny appellant's license application on this violation alone as well.
{¶ 26} Four, appellant admits that he failed to disclose a 2010 arrest in the state of New York on a charge of cruelty to animals, despite that the application specifically requires disclosure of information regarding arrests or convictions of any criminal charges, with the exception of traffic offenses. Although appellant testified at the hearing that he did not think he had to disclose this information because the charges were later dismissed, the application clearly requests information for all arrests, with no exceptions for arrests other than traffic violations. Particularly because the charge was for animal cruelty to a race horse, reliable, probative, and substantial evidence supports the Commission's determination that failure to disclose this arrest arose to a material misrepresentation in violation of Ohio Adm.Code 3769-12-26(A)(7). Therefore, the Commission had discretion to deny appellant's license application on this violation alone as well.
{¶ 27} Finally, in addition to the failure to disclose the various information discussed above, the record shows that the Commission's determination that the "most recent actions" of appellant show that he has engaged in conduct against the best interest of horse racing in violation of Ohio Adm.Code 3769-2-26(A)(10) is supported by reliable, probative, and substantial evidence. Thus, even if appellant had disclosed the material information omitted from his application, the information regarding the more recent disciplinary actions-i.e., within the last five years and within the "look back" period-is information that fully supports the Commission's finding that appellant's actions constitute conduct against the best interest of horse racing. Thus, reliable, probative, and substantial evidence supports this finding as well.
{¶ 28} In sum, the trial court did not abuse its discretion in determining that appellant failed to disclose all required information on his application and that the Commission's order was supported by reliable, probative, and substantial evidence. The Commission could have properly denied appellant's application on any one of the multiple basis discussed above. Therefore, the trial court did not abuse its discretion in affirming the March 14, 2022 adjudication order of the Commission denying appellant's application for a standardbred owner and trainer license and finding that the Commission's determination was in accordance with the law. Accordingly, appellant's second assignment of error is overruled.
IV. Disposition
{¶ 29} For the foregoing reasons, we overrule both of appellant's assignments of error, and we affirm the judgment of the Franklin County Court of Common Pleas.
Judgment affirmed.
MENTEL, J., concurs.
LUPER SCHUSTER, J, concurring separately
{¶ 30} I agree with the majority that the trial court did not abuse its discretion in determining that reliable, probative, and substantial evidence supports the Commission's decision, and that the decision is in accordance with law. However, because I would reach that conclusion for reasons different than those articulated by the majority, I concur separately.
{¶ 31} Under his first assignment of error, appellant argues the trial court erred when it concluded the Commission did not violate his due process rights by raising throughout the proceedings additional matters not contained in the notice of the charged conduct. Because appellant asks this court to determine whether his due process rights were violated, a question of law, I would review this question under the de novo standard and not, as the majority does, for an abuse of discretion. Floyd's Legacy, L.L.C. v. Ohio Liquor Control Comm., 10th Dist. No. 19AP-704, 2020-Ohio-4074, ¶ 17 (in reviewing an order of an administrative agency, "[d]etermining whether due process requirements have been satisfied presents a legal question we review de novo"), citing Flynn, M.D. v. State Med. Bd. of Ohio, 10th Dist. No. 16AP-29, 2016-Ohio-5903, ¶ 46.
{¶ 32} Pursuant to the Fourteenth Amendment to the United States Constitution and Article I, Section 16 of the Ohio Constitution, administrative proceedings must be consistent with due process. Floyd's Legacy at ¶ 17 citing Richmond, L.P.N. v. Ohio Bd. of Nursing, 10th Dist. No. 12AP-328, 2013-Ohio-110, ¶ 10, citing Mathews v. Eldridge, 424 U.S. 319 (1976). "Procedural due process requires administrative agencies to provide an individual with fair notice of the precise nature of the charges that the agency will pursue at a disciplinary hearing." Macheret v. State Med. Bd. of Ohio, 188 Ohio App.3d 469, 2010-Ohio-3483, ¶ 24 (10th Dist.). Additionally, R.C. 119.07 requires the agency to provide notice that "shall include the charges or other reasons for the proposed action, the law or rule directly involved, and a statement informing the party that the party is entitled to a hearing if the party requests it within thirty days." An appellant alleging the requirements of due process were not satisfied in an administrative proceeding must also demonstrate that the violation of due process resulted in prejudice. Floyd's Legacy at ¶ 17, citing Griffin, M.D. v. State Med. Bd. of Ohio, 10th Dist. No. 11AP-174, 2011-Ohio-6089, ¶ 26.
{¶ 33} Here, appellant does not argue he did not receive notice. Instead, he asserts the notice provided to him was insufficient because the Commission did not disclose its intent to rely on certain exhibits related to his disciplinary history beyond the five-year period set forth in Ohio Adm.Code 3769-12-26(A)(2) or its intent to raise information regarding the "Fishman case." I agree with the majority that the record indicates the Commission did not base its decision on any of the older violations, instead referring to the "more recent actions" supporting the Commission's conclusion that appellant violated Ohio Adm.Code 3769-2-26(A)(10) and that nothing in the Report and Recommendation indicates the Commission relied on any information related to the "Fishman case." Thus, I agree with the majority that appellant's first assignment of error should be overruled, but I do so under a de novo standard of review rather than an abuse of discretion.
{¶ 34} In his second assignment of error, appellant argues the trial court abused its discretion in affirming the Commission's order. The majority sets forth four distinct violations of the Ohio Administrative Code. I agree with the majority that the trial court did not abuse its discretion in finding reliable, probative, and substantial evidence to support the first, second, and fourth violations related to appellant's failure to disclose the 2017 Pennsylvania license suspension, the surrender versus suspension argument, and his failure to disclose his 2010 arrest for animal cruelty. However, as to the third violation, relating to the amount of details appellant disclosed about two suspensions in 2016 due to illicit drugs found in his horses, I agree with appellant that the answer he provided on his application related to these two suspensions did not constitute a material misrepresentation under Ohio Adm.Code 3769-12-16(A)(7). The question on the application asked: "Within the past five years has your racing license been denied, suspended or revoked, or have you been ruled ineligible for licensing by any racing commission or other racing authority? If yes, provide particulars." (Ohio State Racing Comm. License Application at 2.) Appellant answered the question "yes" and then provided the following information: "8/2016 - PA -TCO2 -120 Days; 3/2016 - PA - Xylazene (sic) - 15 Days." (Id.) This additional information provided the dates of the suspensions, the drugs involved, and the length of the suspensions. I would construe this response as providing particular information as the application requested.
{¶ 35} Though the Commission faulted appellant for not providing even more details related to those suspensions, I agree with appellant that the application did not expressly require disclosure of the amount of his fines and additional penalties related to those suspensions. Accordingly, I would find the trial court abused its discretion in concluding reliable, probative, and substantial evidence supports a finding that appellant made a material misrepresentation on his license application related to the 2016 suspensions. However, because I agree with the majority that the other violations, on their own, provided reliable, probative, and substantial evidence supporting the Commission's denial of appellant's application, I would still overrule appellant's assignment of error and affirm the judgment of the trial court.
{¶ 36} For these reasons, I concur separately.