Beasley v. Monoko, Inc.
195 Ohio App. 3d 93
| Ohio Ct. App. | 2011Background
- ODOT contracted with Monoko, Inc. in 1997 to repaint four Guernsey County bridges using the OZEU system per Supplemental Specification 815.
- Supplemental Specification 815 required abrasive blast cleaning, a three-layer organic zinc primer–epoxy–urethane finish, and Monoko QC oversight with ten defined inspection points.
- Contract bonds: performance and payment bonds each $619,000 issued by Peerless Insurance under R.C. 5525.16; performance bond guaranteed proper completion, payment bond guaranteed labor/materials payment.
- Final inspection occurred February 26, 1999, followed by an informal acceptance letter indicating substantial conformity and relieving Monoko of maintenance responsibilities, subject to CMS.
- ODOT later investigated potential bribery in bridge contracts; ODOT filed suit in Guernsey County, later removed to Court of Claims, seeking breach-of-contract and unjust-enrichment damages, plus relief on the bonds; the referee and trial court held final acceptance foreclosed post-acceptance remedies and released Monoko and Peerless from liability, a ruling the Court of Claims adopted on appeal.
- <endofbackground>
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Final acceptance effect on post-acceptance remedies | Beasley argues final acceptance does not waive post-acceptance remedies. | Monoko/Peerless contend final acceptance releases obligations and bars post-acceptance claims. | Final acceptance releases the contractor from further obligations; no post-acceptance remedies survive. |
| No-waiver clause vs final acceptance | ODOT asserts 107.20 prevents waiver, applying post-final-acceptance rights. | appellees contend 107.20 does not apply to final acceptance; no post-acceptance waiver. | 107.20 does not apply to final acceptance; no conflict; waiver not available after final acceptance. |
| Equitable estoppel/waiver against government | ODOT asserts estoppel/waiver defenses against governmental function. | Monoko asserts estoppel/waiver apply generally. | Equitable estoppel/waiver not applicable against governmental action here; contract terms govern. |
| Peerless liability under performance bond after completion | ODOT argues performance bond liability persists post-completion. | Bond liability ends with final acceptance; only payment bond remains. | Peerless cannot be liable on the performance bond; no post-acceptance liability; only payment bond survives. |
Key Cases Cited
- Mon-Rite Constr. Co. v. Northeast Ohio Regional Sewer Dist., 20 Ohio App.3d 255 (1984) (waiver-type argument under final payment clause considered in contract context)
- Pilot Oil Corp. v. Ohio Dept. of Transp., 102 Ohio App.3d 278 (1995) (estoppel/waiver defenses against government function discussed)
- Alexander v. Buckeye Pipe Line Co., 53 Ohio St.2d 241 (1978) (contract interpretation and intent when construing written agreements)
- Foster Wheeler Enviresponse v. Franklin Cty. Convention Facilities Auth., 78 Ohio St.3d 353 (1997) (cannot rewrite contract for equitable result; enforce contract terms as written)