Recently, the Ohio Supreme Court determined in Ayers v. The City of Cleveland, 2020-Ohio-1047, that the right to indemnification under R.C. 2744.07(A)(2) may only be asserted by an employee of a political subdivision.
This is an important decision because it thwarts the plaintiff bar’s recent tactic to seek indemnification directly from a political subdivision to satisfy jury awards by effectively circumventing established immunity. The Supreme Court made clear that the legislature did not intend to protect plaintiffs/judgment creditors or create an exception to political subdivision immunity that is not expressly in the Political Subdivision Tort Liability Act.
David Ayers was released from prison after prevailing on a federal habeas corpus claim. He then filed a civil rights violation claim against the City of Cleveland and two police detectives. The trial court dismissed all claims against the City of Cleveland. Ayers obtained a large judgment against the detectives. The detectives offered to assign any indemnification claim to Ayers in exchange for an agreement by Ayers to forgo collection efforts against the detectives personally. Ayers rejected each offer.
Ayers brought a claim in state court against the City of Cleveland and the attorney who represented both Cleveland and the detectives for statutory indemnification pursuant to R.C. 2744.07(A)(2) among other claims. The trial court granted summary judgment in favor of Ayers concluding that R.C. 2744.07(A)(2) required Cleveland to indemnify the officers and pay the judgment. The Eighth District Court of Appeals reversed by concluding that Ayers, as a judgement creditor, did not have standing to bring a private cause of action against the city to enforce the city’s obligations to its employees.
The Ohio Supreme Court accepted jurisdiction over Ayers’s only proposition of law “R.C. 2744.07(A)(2) reflects the legislature’s intent to permit a judgment creditor to proceed directly against an indemnitor.” Upon the Ohio Supreme Court’s acceptance of this case, Mazanec, Raskin & Ryder was retained by the Ohio Association of Civil Trial Attorneys to write an amicus or “friend of the court” brief in support of the City of Cleveland’s position. MRR Partner Frank Scialdone wrote the amicus brief.
In its decision and in accord with MRR’s arguments as amicus, the Ohio Supreme Court focused on the issue of whether a judgment creditor may proceed directly against a political subdivision under R.C. 2744.07(A)(2). R.C. 2744.07(A)(2) provides that a political subdivision “shall indemnify and hold harmless an employee” thus, “the right of indemnification is personal to the employee. Therefore, the Ohio Supreme Court held that “the unambiguous language of the statute, which serves only to indemnify an employee and does not vest any rights in third parties connected to the employee,” concluding that R.C. 2744.07(A)(2) does not permit a judgment creditor to proceed directly against an indemnitor.
This decision comports with the general shield from liability afforded political subdivisions for the acts of their employees and exceptions to that general rule must be specifically set forth in the statute. R.C. 2744.02(A)(2) provides for a political subdivision to indemnify only employees of the political subdivision. Because the statute does not specifically provide for a third party to enforce an employee’s right of indemnification, the Ohio Supreme Court held that under R.C. 2744.07(A)(2), indemnification by a political subdivision is a personal right of a particular employee. Thus, based on the plain language of that statute, the personal right of indemnification may be asserted only by the employee and it may not be asserted by a judgment creditor.
This update is not intended to constitute legal advice or form an attorney-client relationship. If you have any questions, we encourage you to contact an attorney at Mazanec, Raskin & Ryder to help address your specific circumstances.