Ohio Historical Society v. General Maintenance & Engineering Co.

• Decision Date: 24 October 1989
• Docket Number: No. 89AP-104,89AP-104
• Citation: 65 Ohio App.3d 139,583 N.E.2d 340
• Parties: OHIO HISTORICAL SOCIETY, Appellant, v. GENERAL MAINTENANCE AND ENGINEERING COMPANY et al., Appellee. *
• Court: Ohio Court of Appeals

Page 139

65 Ohio App.3d 139

583 N.E.2d 340

OHIO HISTORICAL SOCIETY, Appellant, v. GENERAL MAINTENANCE AND ENGINEERING COMPANY et al., Appellee. ^*

No. 89AP-104.

Court of Appeals of Ohio, Tenth District, Franklin County.

Decided Oct. 24, 1989.

Fred J. Milligan, Jr., Westerville, for appellant.

Szolosi & Fitch, Stephen C. Fitch and Guy R. Humphrey, Columbus, for appellee Gen. Maintenance and Engineering Co.

McNamara & McNamara and John L. Miller, Columbus, for appellee Manville Sales Corp.

McCORMAC, Presiding Judge.

Plaintiff-appellant, Ohio Historical Society ("OHS"), appeals from the judgment of the trial court for defendant-appellee, separate-appellant, General Maintenance and Engineering Company ("General Maintenance"), as well as the trial court's dismissal of appellant's claims against defendant-appellee, separate-appellee, Manville Sales Corporation ("Manville"). This litigation was initially commenced by OHS against General Maintenance. Subsequently, OHS amended its complaint to include Manville, the system manufacturer. In turn, General Maintenance filed a cross-claim against Manville. After amendment, appellant's complaint sounded in breach of warranty and strict liability in tort.

The case was tried to the court which, at the close of the evidence, dismissed Manville from the proceeding. On December 23, 1988, findings of fact and conclusions of law were filed by the court granting a verdict for General Maintenance and dismissing its counterclaim against Manville.

OHS raises the following assignments of error:

"1. The trial court erred in holding that defendant General Maintenance and Engineering was not responsible under Paragraph 10.4 of its contract for defective or faulty work discovered after the expiration of the one year correction of work and guaranty clauses in its contract.

"2. The trial court's decision that the failure of the roof was not due to defendant General Maintenance and Engineering's defective or faulty work was contrary to law and the manifest weight of the evidence.

"3. The trial court erred in holding that plaintiff was not entitled to judgment against defendant General Maintenance and Engineering as a result of defendant's breach of its contract to arrange for inspections by the manufacturer and to provide a manufacturer's warranty.

"4. The trial court erred in holding that plaintiff was not entitled to judgment against defendant General Maintenance and Engineering in tort based on breach of its duty to perform its construction services in a workmanlike manner."

General Maintenance has filed a separate appeal against Manville and advances the following assignment of error:

"In The Event This Court Reverses The Judgment Of The Trial Court On Any OHS Claim Against GENERAL MAINTENANCE, Should The Court Reverse The Judgment Against GENERAL MAINTENANCE On Its Cross-Claim?"

During the summer months of 1983, General Maintenance performed repairs to a four-foot ledge area of the Ohio Historical Center, a facility owned and operated by OHS. The repairs consisted of installing an elastomeric membrane ("EPDM") roof to the ledge area in question. Installation of an EPDM roof involves affixing a rubberlike membrane to insulation board laid over the existing concrete surface. The membrane is attached at all elevation changes by the use of wooden nailers, which are then covered by flashing. The seams and flashing are sealed by the use of lap cement and a waterproof caulking. When completed, the total system is intended to provide a water-tight covering in order to keep moisture from attacking the structural integrity of the underlying concrete surface.

Prior to the bidding process, plans and specifications were prepared by Dellas Harder, an architect and facilities manager for OHS. General Maintenance was the low bidder and, on February 19, 1983, the plans and specifications were incorporated into a written contract between the two parties. Article 10.4 of the standard AIA agreement executed by the parties provided a general warranty that all materials and workmanship be of good quality and free of defects. Section 2.03 of the supplemental general conditions contained in the plans and specifications added a second guarantee clause to the contract. That section reads:

"The Contractor shall guarantee his workmanship and materials for a period of one (1) year from the date of acceptance by the Architect, and shall leave the work in perfect order at completion. Should defects develop, within the guaranteed period, the Contractor shall, upon written notice of same, remedy the defects and reimburse The Ohio Historical Society for all damage to the other work whether caused by the defects or the work correcting same. The Performance Bond furnished by the Contractor as part of this Contract shall remain in effect until the expiration of the guarantee period as assurance of the Contractor's obligation to meet the guarantee herein stipulated. Guarantees, if any, extending beyond said one (1) year period shall be specifically provided for in the contract and may be fulfilled by assignment of the bond or written warranty of the manufacturer."

The specifications went on to require that General Maintenance purchase the manufacturer's standard twenty-year warranty covering the membrane only. The original systems manufacturer requested by OHS was changed to Manville Sales Corporation at the suggestion of General Maintenance. In January 1987, OHS first discovered that the EPDM system had failed, allowing water to penetrate into the underlying insulation board. The evidence shows that the seams of the membrane sheets had separated on over sixty percent of the ledge roof surface.

In its first assignment of error, OHS argues that the trial court erred in holding that the contract created an exclusive one-year limitation period thereby precluding its claims against General Maintenance. Article 10.4 of the contract provides:

"The Contractor warrants to the Owner and the Architect that all materials and equipment incorporated in the Work will be new unless otherwise specified, and that all Work will be of good quality, free from faults and defects and in conformance with the Contract Documents. All Work not conforming to these requirements may be considered defective."

At issue is whether section 2.03 of the contract specifications effectively limits General Maintenance's warranty liability under Article 10.4 to one year.

Section 2.03 contains no language expressly limiting OHS from claiming damages under any other warranty provision in the contract, nor is there language indicating that section 2.03 is to be OHS' exclusive remedy for defective workmanship or materials. General Maintenance contends that the last sentence of the cited section should be read as a limitation provision. However, that sentence expressly states that this section is to be construed as exclusive only if there are no other warranty provisions in the contract. In the documents at issue, there are two other warranty clauses: Article 10.4, which provides a general warranty limited only by the applicable statute of limitations; and a specific requirement that General Maintenance purchase a warranty from the membrane manufacturer. Therefore, section 2.03 is an additional but not an exclusive remedy. The trial court erred in holding otherwise.

In First National Bank of Akron v. Cann (N.D.Ohio 1980), 503 F.Supp. 419, the District Court for the Northern District of Ohio was presented with a similar situation. In holding that plaintiff's claims were not barred by the one-year period, the court reasoned that the one-year provision established a right in the contractor to rectify any defects within one year of completion and a corresponding duty of the owner to allow the contractor to correct the defects before instituting alternative remedies. This same conclusion has been reached by other courts. All Seasons Water Users Assn., Inc. v. Northern Improvement Co. (N.D.1987), 399 N.W.2d 278; Omaha Home for Boys v. Stitt Constr. Co. (1976), 195 Neb. 422, 238 N.W.2d 470; Bd. of Regents v. Wilson (1975), 27 Ill.App.3d 26, 326 N.E.2d 216.

Contract documents should be construed in their entirety to give effect to the intention of the parties. Skivolocki v. East Ohio Gas Co. (1974), 38 Ohio St.2d 244, 67 O.O.2d 321, 313 N.E.2d 374. It must be assumed that each provision of a contract is inserted for a purpose. To hold, as General Maintenance argues, that the one-year warranty is exclusive would render the other warranty provisions of the contract meaningless. However, if the one-year provision is construed to be an additional remedy, the entire contract can be read in harmony.

Appellant's first assignment of error is sustained.

By its second assignment of error, OHS contends that the trial court erred in finding that OHS had failed to establish the existence of a defect attributable to General Maintenance's faulty workmanship or materials. In order to prevail on this issue, OHS must prove, within a reasonable degree of probability, that any claimed act or failure to act on the part of General Maintenance caused the roofing system to fail. The law deals in probabilities, not possibilities. Burens v. Indus. Comm. (1955), 162 Ohio St. 549, 55 O.O. 436, 124 N.E.2d 724. The trial court found that OHS' evidence failed to establish the probable cause of the failure because appellant's expert witness testified that there were three possible causes without identifying which cause was the probable cause.

Karl Kuhn, called as a roofing expert by OHS, testified that the roof's failure was due to the separation of the flashing from the membrane at the points where the perimeter bars were installed. When questioned about why the flashing had separated, he described three alternatives: the subsurface was improperly prepared prior to applying the...