Davis v. Hawley Gen. Contracting, Inc.
42 N.E.3d 276
Ohio Ct. App.2015Background:
- Tom and Judy Davis (trustees of the Davis Family Holiday Lake Trust) hired Hawley General Contracting, Inc. (HGC) in 2010 to excavate and convert a crawl space into a walk-out basement; Joel Hawley signed the contract as “Builder, Hawley General Contracting.”
- HGC completed the basement in June 2010 for $60,000; within weeks a horizontal crack appeared in the newly poured block walls; repeated regrouting attempts failed and the crack widened and leaked.
- Ground-penetrating radar testing (GPRS) showed vertical reinforcement (rebar) did not extend from the footing to the sill plate and grout was incomplete in places; multiple witnesses (building inspector and structural engineer) testified this fell below residential code and caused the walls to hinge and fail.
- Trial court found breach of contract and awarded about $30,400 to replace the walls, but declined to find a CSPA violation, declined to hold Hawley personally liable, and denied statutory/treble/punitive remedies and attorneys’ fees.
- On appeal, the Sixth District reversed the trial court: it held the contractor’s conduct amounted to a CSPA violation, found Hawley personally liable, and concluded the record established knowing conduct warranting attorney fees under the CSPA; the case was remanded.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether contractor's substandard, below-code basement construction and concealment of defects violated the CSPA | Davis: Failure to install rebar/anchors, concealment of the defect, and promises to repair constituted unfair/deceptive practices; latent defect warranted CSPA claim within limitations | Hawley/HGC: Poor workmanship alone is not a CSPA violation; there were differing expert views and inspections passed | Court: Reverse — conduct (below-code construction, concealment, inadequate repairs, assurances) was a CSPA violation given latent nature of defect and concealment |
| Whether Joel Hawley is personally liable under the CSPA despite contracting through HGC | Davis: Hawley signed documents and made representations; he participated in and directed the conduct and did not disclose agency/LLC status | Hawley: Appellants should have known company performed the work; liability should be limited to the company | Court: Reverse — officer who participated in/controlled the acts is personally liable under the CSPA; Hawley personally liable |
| Whether attorneys’ fees may be awarded under R.C. 1345.09 for knowing CSPA violations | Davis: Hawley/HGC acted knowingly by repeatedly using the same below-code method and promising to fix defects | Defendants: (implicit) no knowing violation warranting fees; argued workmanship dispute | Court: Reverse — testimony that Hawley repeatedly used same below-code method established knowing conduct for purposes of statutory fees; remanded for further proceedings |
| Breach of contract damages awarded below | Davis: Contract/repair defect claim merited damages for wall replacement | Hawley/HGC: Work passed inspection; not structurally defective enough for the relief sought | Court: Trial court had found breach of contract and awarded ~$30,400; appellate decision reversed in part to expand remedies under CSPA and personal liability (case remanded to implement holdings) |
Key Cases Cited
- Einhorn v. Ford Motor Co., 48 Ohio St.3d 27 (1990) (explains CSPA prohibits unfair or deceptive acts by suppliers in consumer transactions)
- Johnson v. Microsoft Corp., 106 Ohio St.3d 278 (2005) (distinguishes unfair/deceptive acts from unconscionable practices and discusses consumer-protection scope)