THE BOARD OF EDUCATION OF THE GREENVIEW LOCAL SCHOOL DISTRICT v. STAFFCO CONSTRUCTION, INC., еt al.
C.A. CASE NO. 2016-CA-11
T.C. NO. 15CV179
IN THE COURT OF APPEALS OF OHIO SECOND APPELLATE DISTRICT GREENE COUNTY
October 14, 2016
2016-Ohio-7321
Civil appeal from Common Pleas Court
Attorneys for Plaintiff-Appellant
EDWARD J. DOWD, Atty. Reg. No. 0018681 and KEVIN A. LANTZ, Atty. Reg. No. 0063822, 8163 Old Yankee Street, Suite C, Dayton, Ohio 45458
Attorneys for Defendants-Appellees Staffco Construction, Inc. and Federal Insurance Company
O P I N I O N
DONOVAN, P.J.
{¶ 1} Plaintiff-appellant Board of Education of the Greenview Local School District
{¶ 2} On or about April 14, 2000, Staffco initiated performance on a contrаct that it had entered into with the Board regarding a construction project at Greenview High School. Federal issued a guaranty and a bond securing Staffco‘s performance on the project. Specifically, the contract required Staffco to install a metal wall panel system, metal roof panel system, composite roof system, and other related construction components at the new high school. Staffco was the general contrаctor on the project between 2000 and 2001. The Board took occupancy of the new high school during August of 2001. Following the Board‘s occupancy, Staffco was required to perform various repairs at the high school.
{¶ 3} Apprоximately fourteen years later on March 9, 2015, the Board filed a complaint alleging that Staffco failed to perform its work at the high school “in full compliance with the *** [c]ontract or in a workmanlike manner.” The Board further allegеd that “Staffco‘s defective and non-conforming work on the Project result[ed] in ongoing water leaks, moisture issues, and other building envelope issues.”
{¶ 4} Thereafter on May 1, 2015, Staffco and Federal filed an answer and counterclaim alleging that the Board breached its duty to conduct competent inspections and repair the work performed by Staffco at the high school. Staffco also argued that any building defects in the high school are a “proximate cоnsequence of [the Board]‘s
{¶ 5} On May 28, 2015, the Board filed a motion for a judgment on the pleadings with respect to Staffco‘s counterclaims pursuant to
{¶ 6} Initially, we note that the Board advanced several legal arguments in support of its motion for judgment on the pleadings before the trial court. On appeal, however, the Board only challenges the trial court‘s decision denying its claim for immunity regarding Staffco‘s negligence claims under
{¶ 7} The Board‘s sole assignment of error is as follows:
{¶ 8} “THE TRIAL COURT ERRED IN OVERRULING THE BOARD OF
{¶ 9}
Motion for judgment on the pleadings
After the pleadings are closed but within such time as not to delay the trial, any party may move for judgment on the pleadings.
{¶ 10} A
{¶ 11} A
{¶ 12} Unlike a
{¶ 13} Ordinarily, an order overruling or denying a
{¶ 14} The Political Subdivision Tort Liability Act, as codified in
{¶ 15} “The second tier of the analysis requires a court to determine whether any of the five exceptions to immunity listed in
{¶ 16} “Political subdivision” or “subdivision means a ... body both corporate and politic responsible for governmental activities in a gеographic area smaller than that of the state.”
{¶ 17} Having determined that the general grant of immunity applies to the Board, we now turn to whether any exceptions to immunity listed in
{¶ 18} However, Staffco does not dispute that the only damages it suffered as a result of the Board‘s alleged negligencе are the money expenditures it incurred to perform remedial repairs to the high school buildings after the original work had been completed. Put another way, the only damages that Staffco and Federal assert that they suffered frоm the Board‘s negligence were purely economic losses.
{¶ 19} Recently, in Federal Insurance Co. v. Fredericks, 2015-Ohio-694, 29 N.E.3d 313 (2d Dist.), we stated the following:
“[E]conomic losses are intangible losses that do not arise from tangible physical harm to persons or property.” RWP, Inc. v. Fabrizi Trucking & Paving Co., 8th Dist. Cuyahoga No. 87382, 2006-Ohio-5014, ¶ 20, citing Columbia Gas of Ohio v. Crestline Paving & Excavating Co., 6th Dist. Lucas No. L–02–1093, 2003-Ohio-793, and Floor Craft Floor Covering, Inc. v. Parma Comm. Gen. Hosp., 54 Ohio St.3d 1, 3, 560 N.E.2d 206 (1990). (Other citation omitted.) “Thus, where only econоmic losses are asserted, damages may be recovered only in contract; there can be no recovery in negligence due to the lack of physical harm to persons and tangible things.” RWP, Inc. at ¶ 21, citing Queen City Terminals v. Gen. Am. Transp. Corp., 73 Ohio St.3d 609, 653 N.E.2d 661 (1995). (Other citations omitted.) Id. at ¶ 23.
The economic-loss rule genеrally prevents recovery in tort of damages for purely economic loss. See Chemtrol Adhesives, Inc. v. Am. Mfrs. Mut. Ins. Co. (1989), 42 Ohio St.3d 40, 45, 537 N.E.2d 624; Floor Craft Floor Covering, Inc. v. Parma Community Gen. Hosp. Assn. (1990), 54 Ohio St.3d 1, 3, 560 N.E.2d 206. ” ‘[T]he well-established general rule is that a plaintiff who has suffered only economic loss due tо another‘s negligence has not been injured in a manner which is legally cognizable or compensable.’ ” Chemtrol, 42 Ohio St.3d at 44, 537 N.E.2d 624, quoting Nebraska Innkeepers, Inc. v. Pittsburgh–Des Moines Corp. (Iowa 1984), 345 N.W.2d 124, 126. See, also, Floor Craft, 54 Ohio St.3d at 3, 560 N.E.2d 206. This rule stems from the recognition of a balance between tort law, designed to redress losses suffered by breach of a duty imposed by law to protect societal interests, and contract law, which holds that “parties to a commercial transaction should remain free to govern their own affairs.” Chemtrol, 42 Ohio St.3d at 42, 537 N.E.2d 624. See, also, Floor Craft, 54 Ohio St.3d at 7, 560 N.E.2d 206, quoting Sensenbrenner v. Rust, Orling & Neale Architects, Inc. (1988), 236 Va. 419, 425, 374 S.E.2d 55. ” ‘Tort law is not designed * * * to compensate parties fоr losses suffered as a result of a breach of duties assumed only by agreement. That type of compensation necessitates an analysis of the damages which were within the contemplation of the parties when framing their agreement. It remains
the particular province of the law of contracts.’ ” Floor Craft, 54 Ohio St.3d at 7, 560 N.E.2d 206, quoting Sensenbrenner, 236 Va. at 425, 374 S.E.2d 55.
{¶ 21} In light of the economic loss rule, Staffco‘s decision to spend money on remedial repairs to the high school is not a legally cognizable injury in tort law. We also note that the cases relied upon by Staffco tо support its conclusion that the “property” as used in
{¶ 22} Lastly, we find that Federal has no independent cause of action in tort against the Board. While
{¶ 23} The Board‘s sole assignment of error is sustained.
{¶ 24} The Board‘s sole assignment of error having been sustained, the judgment of the trial court is reversed with respect to Staffco and Federal‘s counterclaim for negligence. This matter is therefore remanded to the trial court for proceedings consistent with this opinion.
WELBAUM, J., concurs.
FROELICH, J., concurs in judgment only.
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