Rockwell Intern. Corp. v. Regional Emergency Medical Services of Northwest Ohio, Inc.

• Decision Date: 17 September 1982
• Docket Number: No. 80-3604,80-3604
• Citation: 688 F.2d 29
• Parties: ROCKWELL INTERNATIONAL CORP., Plaintiff-Appellant, v. REGIONAL EMERGENCY MEDICAL SERVICES OF NORTHWEST OHIO, INC., Defendant-Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 29

688 F.2d 29

ROCKWELL INTERNATIONAL CORP., Plaintiff-Appellant, v. REGIONAL EMERGENCY MEDICAL SERVICES OF NORTHWEST OHIO, INC.,

Defendant-Appellee.

No. 80-3604.

United States Court of Appeals, Sixth Circuit.

Argued Dec. 17, 1981.

Decided Sept. 17, 1982.

Richard S. Baker, Toledo, Ohio, for plaintiff-appellant.

Arthur F. James, Rosen, Shinaberry, James & Weiher, Toledo, Ohio, for defendant-appellee.

Before JONES, Circuit Judge, WEICK, Senior Circuit Judge, and SILER, District Judge. ^*

SILER, District Judge.

Collins group, a subdivision of Rockwell International Corp. (hereinafter "Collins"), has appealed from a directed verdict granted in favor of the defendant-appellee Regional Medical Services of Northwest Ohio, Inc. (hereinafter "REMSNO"). The issue to be decided in this case is whether the district court erred in granting a directed verdict. For the reasons set forth below, we reverse and remand for a new trial.

The facts giving rise to this controversy began on April 7, 1975, when Collins contracted with the Medical College of Ohio at Toledo (hereinafter "MCO") to furnish and install an Emergency Medical Communication System for an area of Northwest Ohio. On July 15, 1975, MCO assigned the rights and delegated the duties under the contract to REMSNO, with the knowledge and approval of Collins. Prior to the original completion date (October, 1975), several problems developed. Building permits, authorizations and Federal Commission licenses were not obtained by either MCO or REMSNO, although MCO was obligated under the contract to obtain all "necessary licenses and permits required under the Federal Communications Commission and the Federal Aviation Administration."

It became apparent that some of the equipment installed by Collins (according to specifications prepared and furnished by MCO) would be insufficient to meet the needs of the emergency system. However, it does not appear that the items installed by Collins were defective. Approximately six months after the contracted completion date Collins informed REMSNO that it would be impossible to proceed further under the original contract due to the aforementioned problems and resulting delays. The system was eventually completed by Motorola under another contract. On August 23, 1977, Collins filed suit against MCO and REMSNO for breach of contract. Collins alleged it was due $69,442.00 under a ten per cent withholding clause and $79,852.00 for additional work performed, for a total of $149,294.00. The district court concluded the Ohio Court of Claims had jurisdiction over the suit against MCO and directed a verdict accordingly. After presentation of the evidence, the court also directed a verdict in favor of REMSNO from which Collins has appealed.

On a motion for a directed verdict, the court should consider the evidence in the light most favorable to the party against whom the motion was made, and give it the advantage of every fair and reasonable inference that the evidence can justify. Continental Ore v. Union Carbide & Carbon Co., 370 U.S. 690, 82 S.Ct. 1404, 8 L.Ed.2d 777 (1962); Fortner Enterprises, Inc. v. United States Steel Corp., 452 F.2d 1095 (6th Cir. 1971), cert. denied, 406 U.S. 919, 92 S.Ct. 1773, 32 L.Ed.2d 119 (1972). A directed verdict is appropriate if there is a complete absence of pleading or proof on an issue or issues material to the cause of action or where there are no controverted issues of fact upon which reasonable men could differ. Edwards v. United States, 140 F.2d 526 (6th Cir. 1944). In this case, however, there was a factual issue presented to the court below. Therefore, the directed verdict was erroneously granted.

The issue which should have been presented to the jury was the question of who was responsible for the delays which led to this action. Collins argued that it was prevented from fully performing its obligations by the delays which were the fault of MCO and REMSNO. REMSNO argued that it was not in a position to become responsible under the contract until it received federal funding for the project in December of 1975. REMSNO states that the July, 1975, assignment from MCO to REMSNO was an "assignment in name only" or a "paper assignment." While REMSNO might not have been to blame for the delays, it apparently became legally responsible as of the date of assignment from MCO. ¹ In reference to the delays which occurred, the district court stated, "There is just no evidence that would show that that was the fault of the plaintiff (Collins) any more than it was the fault of the defendant."

As this was a case filed under the diversity jurisdiction of the court, 28 U.S.C. § 1332, state law controls. Erie R. R. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). Moreover, as the contract provided that Ohio law governed, it is to be applied here.

Where one party to a contract hinders or prevents the completion of a contract, this constitutes a breach of the contract. See Rohde v. Massachusetts Mutual Life Ins. Co., 632 F.2d 667, 670 (6th Cir. 1980) (applying Ohio law); Gridiron Steel...