Justia Ohio Supreme Court Opinion Summaries

Articles Posted in Construction Law
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The Supreme Court reversed the judgment of the court of appeals affirming the trial court's order permanently enjoining enforcement of Ohio Rev. Code 9.75, which prohibits a public authority from requiring that contractors on public-improvement projects employ a specific number or percentage of the public authority's residents, holding that section 9.75 is a general law and prevails over local laws.The appellate court affirmed the trial court's order permanently enjoining enforcement of section 9.75, holding that Ohio Const. art. II, 34 did not authorize the General Assembly to infringe on the City of Cleveland's municipal home-rule authority under Ohio Const. art. XVIII, 3 to impose city-residency preferences in Cleveland's public-improvement contracts. The Supreme Court reversed and remanded the matter to the trial court to dissolve the injunction, holding that the statute provides for the comfort and general welfare of all Ohio construction employees and therefore supersedes conflicting local ordinances. View "Cleveland v. State" on Justia Law

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The Supreme Court reversed the judgments of the court of appeals in this construction dispute, holding that Ohio's construction statute of repose, Ohio Rev. Code 2305.131, applies to any cause of action, whether sounding in contract or tort, so long as the cause of action meets the requirements of the statute.Plaintiff filed this action against several defendants, companies involved in the design and construction of a public school building, alleging claims for breach of contract. Defendants argued that the statute of repose on section 2305.131 barred Plaintiff's claims because substantial completion of the project occurred more than ten years before the claims were filed. The trial court agreed and dismissed the claims as time barred. The court of appeals reversed, concluding that section 2305.131 does not apply to breach of contract claims. The Supreme Court reversed, holding that section 2305.131 applies to both contract and tort claims. View "New Riegel Local School District Board of Education v. Buehrer Group Architecture & Engineering, Inc." on Justia Law

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The Supreme Court answered a certified question from the Unitde States District Court by holding that Ohio Rev. Code 4123.35(O) is not unconstitutional as applied to the tort claims of an enrolled subcontractor’s employee who is injured while working on a self-insured construction project and whose injury is compensable under Ohio’s workers’ compensation laws.Daniel Stolz was injured while working as a concrete finisher for Jostin Construction. Jostin was a subcontractor of Messer Construction Company, the general contractor for the project. Under section 4123.35(O), Messer provided workers’ compensation coverage on the project for employees of subcontractors like Jostin that chose to enroll in Messer’s self-insurance plan. Stolz eventually sued Messer and several subcontractors for negligence. Messer and three enrolled subcontractors argued that they were immune from liability under section 4123.35(O). The Supreme Court concluded that the statute provides immunity to both general contractors and enrolled subcontractors from tort claims brought by employees of other enrolled subcontractors. Stolz later amended his complaint to allege that section 4123.35(O) is unconstitutional. The enrolled subcontractors petitioned the district court to certify a question of state law to the Supreme Court. The Supreme Court answered that section 4123.35(O) does not violate the Ohio Constitution’s right-to-remedy, right-to-jury, or equal-protection provisions. View "Stolz v. J & B Steel Erectors, Inc." on Justia Law

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At issue was whether a general contractor’s commercial general liability (CGL) policy that is nearly identical to the one considered in Westfield Insurance Co. v. Custom Agri Systems, Inc., 979 N.E.2d 269 (Ohio 2012), covers claims for property damage caused by a subcontractor’s faulty work.The Supreme Court resolved the issue by applying the holding of Custom Agri which provides that property damage caused by a subcontractor’s faulty work is not an “occurrence” under a CGL policy because it cannot be deemed fortuitous. The Court then reversed the judgment of the court of appeals, which reversed the trial court’s conclusion that the insurer in this case had no duty to defend the CGL policy owner, a general contractor. The Supreme Court held that the insurer was not required to defend the insured against suit by the property owner or indemnify the insured against any damage caused by the insured’s contractor. View "Ohio Northern University v. Charles Construction Services, Inc." on Justia Law

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In 2005, Roark, a Sunesis laborer, was working alone at the bottom of a trench, when the trench collapsed, killing him. The Bureau of Workers’ Compensation awarded Roark’s dependent children benefits. The dependents sought an additional award based on violations of specific safety requirements for sloping, shoring, and bracing. A hearing officer concluded that Roark’s death was the result of Sunesis’s failure to properly support the trench and ordered Sunesis to pay an additional award based on violations of Ohio Adm.Code 4123:1-3-13. On remand, a hearing officer issued factual findings based on photographs and testimony: Three sides of the trench were adequately shored. The fourth wall, which caved in on Roark, consisted of soil that Sunesis attempted to shore up by sloping the wall and inserting a steel plate above the slope. The hearing officer found no evidence that Roark disregarded instructions to work inside a large underground pipe. On rehearing, in 2012, a hearing officer identified the soil involved as soft material, Class C soil with groundwater, stating that Code Table 13-1 addresses the approximate angle of repose for sloping: The presence of groundwater requires special treatment. The commission, the Tenth District, and the Supreme Court of Ohio upheld the award. It was within the commission’s discretion to conclude that the trench was not properly shored or braced, exposing employees to the danger of moving ground and that failure to comply with the regulations proximately caused Roark’s death. View "Sunesis Construction Co. v. Industrial Commission of Ohio" on Justia Law

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Daniel Stolz worked for a subcontractor on a construction project when he was injured in an accident on the job site. Prior to the accident, Messer had obtained authority from the Ohio Bureau of Workers’ Compensation to act as the self-insuring employer on the project, which gave Messer responsibility for providing workers’ compensation coverage for its own employees as well as the employees of enrolled subcontractors on the project. Stolz brought negligence claims against Messer Construction, the general contractor, and several subcontractors. A federal district court granted summary judgment to Messer as the self-insuring employer but denied summary judgment to the subcontractors, concluding that an enrolled subcontractor on a self-insured construction project is immune from claims made by its own employees but not from those made by employees of other enrolled subcontractors. The federal court then certified a question of state law to the Supreme Court. The Supreme Court answered that subcontractors enrolled in a self-insured construction project plan are immune from tort claims for workplace injuries from employees of other enrolled subcontractors on the same project. View "Stolz v. J & B Steel Erectors, Inc." on Justia Law

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A.E.M. Electric Services Corporation, a general contractor, contracted with Transtar Electric, Inc., a subcontractor, to provide electrical services for the installation of a pool at Holiday Inn. A.E.M. did not pay Transtar for its last three invoices because the owner of the project had failed to pay A.E.M. for the work performed by Transtar. A.E.M. alleged that the contract between the parties, which used the phrase “receipt of payment by contractor from the owner for work performed by subcontractor is a condition precedent to payment by contractor to subcontractor for that work”, was sufficient to establish a pay-if-paid payment provision. The court of appeals concluded that the payment provision in the contract was not specific enough to show that both parties understood and agreed that the risk of the owner’s nonpayment would be borne by Transtar instead of A.E.M. The Supreme Court reversed, holding that the use of the term “condition precedent” was an explicit statement of the parties’ intent to transfer the risk of the project owner’s nonpayment from A.E.M. to Transtar.View "Transtar Elec., Inc. v. A.E.M. Elec. Servs. Corp." on Justia Law

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In 1990, construction was completed on a condominium development. In 2003, the Oaktree Condominium Association (“Oaktree”) discovered that there was a defect in the construction. In 2007, Oaktree filed an action against the builder of the condominiums. The jury returned a verdict in favor of Oaktree. The trial court, however, ruled that Oaktree’s claims were time-barred under a ten-year statute of repose enacted by the General Assembly in 2007. The court of appeals affirmed, reasoning that although the statute of repose was not in effect at the time that Oaktree’s action accrued, the action was nonetheless time-barred because Oaktree did not file its action within two years of accrual. The Supreme Court reversed and reinstated the jury verdict in favor of Oaktree, holding (1) Ohio’s construction statute of repose is unconstitutional as applied to Oaktree because the retroactive application of the statute would bar Okatree’s accrued action; (2) a cause of action that has accrued but on which no suit has been filed by the effective date of repose is governed by the relevant statute of limitations; and (3) the complaint was filed within four years of its accrual and was therefore timely under the relevant statute of limitations.View "Oaktree Condo. Ass’n, Inc. v. Hallmark Bldg. Co." on Justia Law

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Younglove Construction entered into a contract with PSD Development for the construction of a feed-manufacturing plant. When PSD withheld payment, Younglove brought this diversity suit against PSD and three other defendants. In its answer, PSD alleged it had sustained damages as a result of defects in a steel grain bin constructed by Custom Agri Systems, Inc. as a subcontractor. Younglove filed a third-party complaint against Custom Agri Systems, Inc. for contribution and indemnity. Custom turned to its insurer, Westfield Insurance Company, to defend and indemnify it in the litigation. Westfield intervened to pursue a judgment declaring it had no such duty under the terms of its commercial general liability (CGL) policy with Custom. At issue was whether the claims against Custom sought compensation for "property damage" caused by an "occurrence" under the policy. The district court granted summary judgment for Westfield. On appeal, the federal court of appeals certified questions of state law to the Supreme Court. The Court answered by holding that claims of defective construction or workmanship brought by a property owner are not claims for "property damage" caused by an "occurrence" under a CGL. View "Westfield Ins. Co. v. Custom Agri Sys., Inc." on Justia Law

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David Barno, a temporary worker on a construction project, alleged that he was injured as a result of Ruscilli Construction Company's violation of a specific safety requirement (VSSR) pertaining to floor openings on construction sites. After a workers' compensation claim was allowed, Barno filed an application for additional compensation with Industrial Commission of Ohio, alleging a violation of Ohio Admin. Code 4123:1-3-04(D). A Commission staff hearing officer (SHO) found that Ruscilli had violated section 4123:1-3-04(D)(1). The court of appeals vacated the SHO's order and remanded the cause to the Commission, finding that the order misinterpreted the applicable safety requirement and that it was based on significant mistakes of fact. The Supreme Court affirmed, holding that the SHO's order contained at least four major errors involving both law and fact, and therefore, the order was premised in findings that lacked evidentiary support. View "State ex rel. Ruscilli Constr. Co. v. Indus. Comm'n " on Justia Law