Title: W E L T M A N, W E I N B E R G
1W E L T M A N, W E I N B E R G R E I S C
O., L. P. A.
Economic Loss Rule Under Attack Presented
by Andrew J. Sonderman, Esq.
CULTIVATING RELATIONSHIPS THROUGH RELIABLE
CREDITOR REPRESENTATION
2Historical Context
- Economic losses are intangible losses that do not
arise from tangible physical harm to persons or
property - Where only economic 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
3Ohio Supreme Court Cases
- Rule stated Queen City Terminals Case (1995)
- Explained Corporex Development Case (2005)
tort law is not designed to compensate parties
for losses suffered as a result of a breach of
duties assumed only by agreement
4Ohio Supreme Court Cases
- Exception Haddon View Investment Case (1982)
accountant liable for negligent misrepresentation
to third parties for economic losses when that
third party is a member of a limited class whose
reliance on the accountants representation is
specifically foreseen.
5Judicial Districts in Ohio
- The state is divided into twelve appellate
districts by Article IV, section 3 of the Ohio
Constitution and section 2501.01 of the Revised
Code. Each district is served by a court of
appeals that sits in each of the counties in that
district. The - number of judges in each
- district depends on a variety of
- factors, including the court's
- caseload and the size of the
- district. The number of judges
- in each district varies from four
- to twelve.
6The Battle Between the Judicial Districts 3rd
District
- Counties Allen, Auglaize, Crawford, Defiance,
Hancock, Hardin, Henry, Logan, Marion, Mercer,
Paulding, Putnam, Seneca, Shelby, Union, Van Wert
and Wyandot
7The Battle Between the Judicial Districts 3rd
District
- United Telephone v. Williams (1995) Williams
claims against United Telephone are for recovery
undertort theories stemming from Uniteds
failure to fully comply with the requirements of
R.C. 153.64. In sum the issue presented here is
whether there exists a relationship between the
parties to allow for the bringing of a tort
action under any theory for purely economic
damages.
8The Battle Between the Judicial Districts 9th
District
- Counties Lorain, Medina, Summit, Wayne
- East Ohio v. Kenmore Construction (2001)
- sufficient nexus exists to recover economic
damages in tort because R.C. 153.64 creates
mandatory duty for utility to locate facilities
for excavators benefit
9The Battle Between the Judicial Districts 6th
District
- Counties Erie, Fulton, Huron, Lucas, Ottawa,
Sandusky, Williams, Wood - Columbia Gas of Ohio v. Crestline Paving (2003)
R.C. 153.64 does not affect rights between
contractorand the owner of the underground
utility facilitySince the economic damages rule
was part of Ohios common law decades before
enactment of 153.64, it is part of the rights the
statute specifically states are unaffected by the
law. - REJECTS 153.64 AS PRIVITY SUBSTITUTE
10The Battle Between the Judicial Districts 8th
District
- Cuyahoga County
- RWP, Inc. v.Fabrizi Trucking Paving
Inc.(2006) Accordingly, Plaintiffs reliance
upon United Telephone and R.C. 153.64 is
unavailing as neither provides a basis for
excusing application of the economic-loss rule in
this matter.
11Trial Court Decisions
- Franklin County Municipal Court Columbia Gas of
Ohio v. Columbus Asphalt Paving (2005) This
court agrees with the Sixth District Court of
appeals analysis of the legislative intent
behind R.C.153.74the Ohio General Assembly did
not intend for the statute to serve as a
substitute for privity.
12The Upcoming Legislative Battle
- Selected comments on Draft amendments to One Call
Statute (Sen. Buehrer hearings) - The Utility shall be responsible for all costs
incurred by the excavator as a result of the
utilitys failure to accurately mark the
approximate location of the underground facility
in accordance with division (A) of section
3781.29. - -- Ohio Contractors Association
13The Upcoming Legislative Battle
- More selected commentsShould the Utility fail
to make necessary repairs within a reasonable
amount of time, the Utility shall be responsible
for any losses incurred by the excavator as a
result of the delay. - -- Ohio Contractors Association
14The Upcoming Legislative Battle
- More selected comments
- The current Oho Revised Code does not address
liability in the event of an unmarked utility
strike. The Ohio Contractors Association has
proposed adding language that would address such
instances. The OHDDA agrees with the OCA
recommendation that these situations be addressed
as no fault scenarios. - -- Ohio Horizontal Directional Drilling
Association
15Thank you for your time.Questions?
16W E L T M A N, W E I N B E R G R E I S C
O., L. P. A.
Andrew J. Sonderman, Esq. Of Counsel Weltman,
Weinberg Reis Co., L.P.A. 175 S. Third St.,
Suite 900 Columbus, OH 43215 614.857.4383
phone 614.233.6826 fax asonderman_at_weltman.com
CULTIVATING RELATIONSHIPS THROUGH RELIABLE
CREDITOR REPRESENTATION