State of Ohio Dept. of Dev. v. Matrix Centennial, L.L.C.
2014 Ohio 3251
Ohio Ct. App.2014Background
- Matrix Centennial, LLC received a $2.5 million Job Ready Site grant from the Ohio Department of Development (ODOD) to build a 90,000 sq ft office building at 1492 Rockwell Avenue; ODOD disbursed $755,920.22.
- The Grant Agreement had a project completion date (amended) of December 18, 2010; Matrix missed the deadline and sought an additional extension in Nov. 2010 which ODOD did not approve.
- ODOD sued (Feb. 2012) for breach of contract and unjust enrichment and sought return of the $755,920.22 already paid.
- Both parties moved for summary judgment; the trial court denied Matrix’s motion, granted ODOD’s, and awarded repayment plus potential collection costs under R.C. 131.02; Matrix appealed.
- The appellate court reviewed de novo and affirmed: it held the Grant Agreement was a valid contract, Matrix breached it, the repayment/liquidated-damages clause was enforceable, economic conditions did not excuse performance, and future collection costs may be assessed under R.C. 131.02.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the grant instrument is an enforceable contract | ODOD: instrument is a contract; ODOD performed by disbursing funds and secured statutory benefit | Matrix: agreement was gratuitous; lack of consideration | Held: Contract valid — consideration exists (ODOD obtained statutory program benefit) |
| Whether Matrix breached and is liable to repay funds | ODOD: Matrix failed to complete project by deadline; clause permits repayment of all or part of funds | Matrix: failure due to recession/financing made performance impossible | Held: Breach established; economic downturn not a legal impossibility; repayment allowed |
| Enforceability/amount of repayment clause (liquidated damages) | ODOD: paragraph 15 authorizes recovery up to full amount disbursed | Matrix: ODOD’s decision to claw back full amount is unreasonable/ambiguous | Held: Repayment provision is clear and enforceable; ODOD may recover up to $755,920.22 |
| Award and specification of collection costs under R.C. 131.02 and timeliness of ODOD’s filing | ODOD: statute allows attorney general to assess collection costs after certification; trial court need not quantify now; filing delay was excusable neglect | Matrix: trial court failed to specify collection costs (no final order) and ODOD did not plead collection costs; ODOD’s summary-judgment filing was untimely | Held: Final appealable order exists despite future assessable collection costs; R.C. 131.02 costs need not be pled as claim in court; trial court did not abuse discretion in allowing late filing (excusable neglect) |
Key Cases Cited
- Kostelnik v. Helper, 96 Ohio St.3d 1 (contract elements and consideration)
- Samson Sales, Inc. v. Honeywell, Inc., 12 Ohio St.3d 27 (liquidated damages/enforceability)
- Dresher v. Burt, 75 Ohio St.3d 280 (summary judgment burden-shifting)
- Grafton v. Ohio Edison Co., 77 Ohio St.3d 102 (de novo review of summary judgment)
- State ex rel. Lindenschmidt v. Butler Cty. Bd. of Commrs., 72 Ohio St.3d 464 (excusable neglect standard for late filings)
- Blakemore v. Blakemore, 5 Ohio St.3d 217 (abuse of discretion standard)