New Riegel Local Sch. Dist. Bd. of Educ. v. Buehrer Grp. Architecture & Eng'g, Inc.

• Decision Date: 17 July 2019
• Docket Number: 2018-0213,Nos. 2018-0189,s. 2018-0189
• Citation: 157 Ohio St.3d 164,133 N.E.3d 482,2019 Ohio 2851
• Parties: NEW RIEGEL LOCAL SCHOOL DISTRICT BOARD OF EDUCATION, Appellee, v. BUEHRER GROUP ARCHITECTURE & ENGINEERING, INC., et al., Appellants.
• Court: Ohio Supreme Court

157 Ohio St.3d 164

133 N.E.3d 482

2019 Ohio 2851

NEW RIEGEL LOCAL SCHOOL DISTRICT BOARD OF EDUCATION, Appellee,

v.BUEHRER GROUP ARCHITECTURE & ENGINEERING, INC., et al., Appellants.

Nos. 2018-0189

2018-0213

Supreme Court of Ohio.

Submitted March 5, 2019

Decided July 17, 2019.

Bricker & Eckler, L.L.P., Christopher L. McCloskey, Tarik M. Kershah, and Bryan M. Smeenk, Columbus, for appellee.

Gallagher Sharp, L.L.P., P. Kohl Schneider, and Richard C.O. Rezie, Cleveland, for appellant Charles Construction Services, Inc.

Frantz Ward, L.L.P., Marc A. Sanchez, Michael J. Frantz Jr., and Allison Taller Reich, Cleveland, for appellant Ohio Farmers Insurance Company.

Ritter, Robinson, McCready & James, Ltd., Shannon J. George, and Matthew T. Davis, Toledo, for appellant Studer-Obringer, Inc.

McNeal, Schick, Archibald & Biro Co., L.P.A., Brian T. Winchester, and Patrick J. Gump, Cleveland, for appellants Buehrer Group Architecture & Engineering, Inc., Estate of Huber H. Buehrer, and Buehrer Group Architecture & Engineering.

Singerman, Mills, Desberg & Kauntz Co., L.P.A, Michael R. Stavnicky, Cleveland, and Stephen L. Byron, urging affirmance for amici curiae County Commissioners Association of Ohio, Ohio Municipal League, Ohio Township Association, Erie County, and Ohio School Boards Association.

Paul W. Flowers Co., L.P.A., Paul W. Flowers, and Louis E. Grube, Cleveland, urging affirmance for amicus curiae Ohio Association for Justice.

Murray & Murray Co., L.P.A., Dennis E. Murray Sr., Charles M. Murray, and Donna J. Evans, Sandusky, urging affirmance for amicus curiae Timothy Betton.

Graff and McGovern, L.P.A., and Luther L. Liggett Jr., Columbus, urging reversal for amici curiae AIA Ohio and Ohio Society of Professional Engineers.

Vorys, Sater, Seymour & Pease, L.L.P., Natalia Steele, Cleveland, and Thomas E. Szykowny, Columbus, urging reversal for amici curiae Ohio Insurance Institute, Ohio Manufacturers' Association, Ohio Chamber of Commerce, Ohio Chapter of the National Federation of Independent Business, and Surety & Fidelity Association of America.

Harpst, Ross & Becker Co., L.L.C., Todd A. Harpst, and Joseph R. Spoonster, Akron, urging reversal for amicus curiae Subcontractors Association of Northeast Ohio.

McDonald Hopkins, L.L.C., Peter D. Welin, Jason R. Harley, and John A. Gambill, Columbus, urging reversal for amici curiae Associated General Contractors of Ohio; Allied Construction Industries (Cincinnati AGC); Associated General Contractors of Ohio, Akron; Builders Association of Eastern Ohio & Western Pennsylvania (AGC Youngstown); Central Ohio AGC; Associated General Contractors, Cleveland; Associated General Contractors of Northwest Ohio (Toledo AGC); West Central Ohio AGC (Dayton AGC); and Ohio Contractors Association.

Koehler Fitzgerald, L.L.C., and Timothy J. Fitzgerald, Cleveland, urging reversal for amicus curiae Ohio Association of Civil Trial Attorneys.

French, J. {¶ 1} These consolidated appeals ask whether Ohio's construction statute of repose, R.C. 2305.131, applies to actions sounding in contract as well as to actions sounding in tort. We hold that R.C. 2305.131, as enacted in Am.Sub.S.B. No. 80, 150 Ohio Laws, Part V, 7915, 7937-7938, applies to any cause of action, whether sounding in tort or contract, so long as the cause of action meets the requirements of the statute.

Facts and Procedural Background

{¶ 2} These appeals arise from the design and construction of a public-school building (the "Project") for the New Riegel Local School District. The Project, which was substantially completed and approved for occupancy in December 2002, was built as part of the Ohio Classroom Facilities Assistance Program, administered by the Ohio School Facilities Commission. Appellee, the New Riegel Local School District Board of Education ("New Riegel"), alleges that condensation, moisture intrusion, and other deficiencies exist in various areas of the Project, as a result of improper design and construction.

{¶ 3} The Buehrer Group Architecture & Engineering contracted with New Riegel to provide design services for the Project; New Riegel alleges that the subsequently incorporated Buehrer Group Architecture & Engineering, Inc. (collectively, with the unincorporated entity, "the Buehrer Group"), adopted, benefited from, and provided services for New Riegel on the contract. Studer-Obringer, Inc., and Charles Construction Services, Inc., served as the general-trades contractor and the roofing contractor, respectively, on the Project, pursuant to contracts with the state; New Riegel was an intended beneficiary of those contracts. In January 2015, New Riegel served the Buehrer Group, Studer-Obringer, and Charles Construction with notices of claims regarding alleged defects in the school building. The Buehrer Group, Charles Construction, Studer-Obringer, and Ohio Farmers Insurance Company—the surety for Studer-Obringer and Charles Construction—are appellants here.

{¶ 4} New Riegel filed this action in April 2015.¹ New Riegel's second amended complaint asserts claims against the Buehrer Group, the Estate of Huber H. Buehrer, Studer-Obringer, Charles Construction, American Buildings Company d.b.a. Architectural Metal Systems, and Ohio Farmers. As relevant here, New Riegel alleges claims for breach of contract against the Buehrer Group, Studer-Obringer, and Charles Construction; a claim for breach of express warranty against Charles Construction; and claims against Ohio Farmers on its surety bonds. It alleges that the Buehrer Group, Studer-Obringer, and Charles Construction "failed to provide [services or work] in conformance to the terms of" their contracts and that Studer-Obringer and Charles Construction failed to conform "with the requisite standard of care to perform in a workmanlike manner." New Riegel alleges that as a result, it has incurred damages, including damages for "physical damage to property."

{¶ 5} In their answers and/or motions for judgment on the pleadings, appellants argued that the statute of repose in R.C. 2305.131 barred New Riegel's claims because substantial completion of the Project occurred more than ten years before New Riegel filed its claims. The trial court granted appellants' motions for judgment on the pleadings and dismissed as time-barred New Riegel's breach-of-contract claims against the Buehrer Group, Studer-Obringer, and Charles Construction. The trial court also dismissed New Riegel's claim against Ohio Farmers as surety for Studer-Obringer. Pursuant to Civ.R. 54(B), the trial court certified that there was no just reason for delay and that the judgment entries were final, appealable orders.

{¶ 6} The Third District Court of Appeals reversed the trial court's judgment in two opinions containing nearly identical language. Although it stated that R.C. 2305.131, on its face, appeared to bar New Riegel's breach-of-contract claims, the Third District determined that it was required to follow this court's decision in Kocisko v. Charles Shutrump & Sons Co. , 21 Ohio St.3d 98, 488 N.E.2d 171 (1986), and to hold that R.C. 2305.131 does not apply to claims for breach of contract. 2017-Ohio-8521, 2017 WL 5256358, ¶ 11 ; 2017-Ohio-8522, 2017 WL 5256360, ¶ 8. Having determined that R.C. 2305.131 does not apply to breach-of-contract claims, the Third District did not address New Riegel's assignment of error arguing that R.C. 2305.131 does not bar its claims against Studer-Obringer and Charles Construction, because the state, with which those entities had contracted, is not subject to statutes of repose. 2017-Ohio-8521 at ¶ 14.

{¶ 7} This court accepted and consolidated appellants' discretionary appeals. 152 Ohio St.3d 1478, 2018-Ohio-1990, 98 N.E.3d 293. Although phrased differently by different appellants, the accepted propositions of law essentially ask this court to hold (1) that R.C. 2305.131's statute of repose applies to both tort and contract actions and (2) that stare decisis should not be applied when, as here, the General Assembly has repealed and replaced the statute construed in the precedent.

Standard of Review

{¶ 8} The trial court entered judgment on the pleadings for appellants pursuant to Civ.R. 12(C). Dismissal is appropriate under Civ.R. 12(C) when a court construes as true the material allegations in the complaint, along with all reasonable inferences to be drawn therefrom, and finds, beyond doubt, that the plaintiff can prove no set of facts that would entitle him to relief. State ex rel. Midwest Pride IV, Inc. v. Pontious , 75 Ohio St.3d 565, 570, 664 N.E.2d 931 (1996). Appellate review of a judgment on the pleadings involves only questions of law and is therefore de novo. Rayess v. Educational Comm. for Foreign Med. Graduates , 134 Ohio St.3d 509, 2012-Ohio-5676, 983 N.E.2d 1267, ¶ 18. Similarly, questions of statutory construction constitute legal issues that we decide de novo on appeal. New York Frozen Foods, Inc. v. Bedford Hts. Income Tax Bd. of Rev. , 150 Ohio St.3d 386, 2016-Ohio-7582, 82 N.E.3d 1105, ¶ 8.

Analysis

{¶ 9} The overarching issue before this court is the meaning of the current version of R.C. 2305.131(A)(1), enacted as part of Am.Sub.S.B. No. 80, 150 Ohio Laws, Part V, 7915, and, particularly, whether the current statute applies to actions sounding in contract as well as to actions sounding in tort. In making that determination, we consider whether we are constrained by the doctrine of stare decisis. But before turning to the question of stare decisis, we briefly review the history of R.C. 2305.131.

The evolution of R.C. 2305.131

{¶ 10} The General Assembly first enacted R.C. 2305.131 in 1963. Am.S.B. No. 112, 130 Ohio Laws, Part I, 648. With the enactment of R.C. 2305.131, Ohio joined the many states that had enacted construction statutes of repose in the late 1950s and early 1960s in response to the expansion of the common-law liability of architects and builders to third parties with whom they lacked privity of contract. Sedar v. Knowlton Constr. Co. , 49 Ohio St.3d...