Cincinnati v. Triton Servs., Inc. , 2022 Ohio 3832 ( 2022 )

[Cite as Cincinnati v. Triton Servs., Inc., 2022-Ohio-3832.]
IN THE COURT OF APPEALS
FIRST APPELLATE DISTRICT OF OHIO
HAMILTON COUNTY, OHIO
CITY OF CINCINNATI, : APPEAL NO. C-210475
A MUNICIPAL CORPORATION, TRIAL NOS. A-1405757
: A-1500905
Plaintiff-Appellee,
:
vs.
: O P I N I O N.
TRITON SERVICES, INC.,
Defendant-Appellant. :
Civil Appeal From: Hamilton County Court of Common Pleas
Judgment Appealed From Is: Affirmed
Date of Judgment Entry on Appeal: October 28, 2022
Taft Stettinius & Hollister LLP and Joseph C. Neff, for Plaintiff-Appellee,
Stites & Harbison, PLLC, and Willian G. Geisen, for Defendant-Appellant.
OHIO FIRST DISTRICT COURT OF APPEALS
BOCK, Judge.
{¶1} Defendant-appellant Triton Services, Inc., (“Triton”) appeals the trial
court’s judgment in favor of plaintiff-appellee city of Cincinnati (“the city”). Triton
asserts that the trial court erred by precluding witness testimony, failing to properly
instruct the jury, and refusing to allow the jury to determine whether the city waived
strict compliance with the contract’s notice provisions.
{¶2} Because we find that the “two-issue” rule applies, any alleged error is
rendered harmless. Therefore, we affirm the trial court’s judgment.
I. Facts and Procedure
A. The parties contracted for sewer work
{¶3} In July 2011, Triton and the city entered into a contract whereby Triton
was to serve as the general contractor on a project to replace sewers (“sewer project”).
The contract incorporated a bid booklet, the State of Ohio Department of
Transportation Construction and Material Specifications (“ODOT CMS”), and the
city’s supplement to the ODOT CMS (“city supplement”).
{¶4} The bid booklet incorporated a geotechnical report that stated,
“excavations for the sewer are anticipated to primarily encounter cohesive soils
interbedded occasionally with cohesionless soils.” The report stated that most of the
test borings contained no water. The bid booklet stated that Metropolitan Sewer
District (“MSD”) did not guarantee or warrant “the accuracy, reliability, or
correctness” of the geotechnical report.
{¶5} Soon after Triton began work, it encountered differing soil conditions,
such as sloughing soils, trench cave-ins, excessive groundwater, and extremely wet
conditions, which caused Triton to incur unanticipated expenses.
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{¶6} The contract provided that if Triton encountered conditions that
materially differed from either the contract documents or from conditions ordinarily
encountered and generally inherent in this type of work, Triton was required to notify
the city’s engineer before the conditions were disturbed. Moreover, Triton had to
provide “written notice of any circumstance or dispute on the project that may result
in a claim. Give early notice by the end of the second working day following the
discovery of the occurrence of the circumstance or dispute.” The contract warned,
“[f]ailure to give early notice or keep and submit cost records will be a sufficient reason
for the City to deny the claim.”
{¶7} The contract contained a mandatory-dispute-resolution process that
had to be exhausted before Triton could bring a claim. The parties could not proceed
to the next tier of the process until the previous tier was complete:
1. Step 1 of Dispute Resolution (Project Level): The Construction
Engineer will meet with the Contractor’s Superintendent within two
working days of receipt of any early notice. They shall review all
pertinent information and * * * negotiate an equitable settlement *
* *. If settlement is not achieved, the dispute is moved to Step 2.
2. Step 2 of Dispute Resolution (Principal Engineer Level): * * *
[R]equest a meeting with the Principal Construction Engineer
within five working days of completion of Step 1. * * * The City and
Contractor’s personnel shall review the information * * * and
negotiate an equitable settlement according to the Contract
Documents. If settlement is not achieved, the dispute is moved to
Step 3.
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3. Step 3 of Dispute Resolution (City Engineer / Chief Engineer Level):
Send the City / Chief Engineer a Notice of Intent to File a Certified
Claim within 14 calendar days of the completion of Step 2. State in
the notice the Contractor’s request for a hearing on the claim or for
an acceptable alternative dispute resolution technique.
{¶8} According to Triton, its director of site development, Brian Gessner,
discussed the differing site conditions with city representatives, including Steve Jones,
the city’s supervising engineer for the sewer project. Triton asserted that Jones
directed Gessner to submit all costs incurred due to differing site conditions at the end
of the project.
{¶9} Triton submitted various change order requests (“COR”) relating to
unforeseen ground conditions. MSD approved all the CORs, except for COR #14,
which was to recoup additional expenses due to undocumented, unsuitable ground
conditions throughout the project, for a total of $534,321.65. The city denied COR #14
and refused to pay Triton for its claimed additional expenses caused by ground
conditions throughout the project. COR #14, and the city’s refusal to pay, is the subject
of this appeal.
{¶10} There is no dispute that Triton did not provide early notice of the
differing site conditions. But Triton asserts that it did not provide early notice because
Jones had waived the early-notice requirement.
B. Both parties sue
{¶11} The city sued Triton for unjust enrichment, breach of contract, and
indemnification. Triton sued the city, the Hamilton County Board of County
Commissioners, and MSD, alleging breach of contract and unjust enrichment due to
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the city’s refusal to approve COR #14. The city counterclaimed for breach of contract
and a declaration that Triton must indemnify the city. The trial court consolidated the
cases.
{¶12} Triton and the city resolved some claims and agreed to a bench trial. The
trial court granted the city’s motion for a directed verdict. Triton appealed the court’s
judgment. This court remanded the case for a new trial. City of Cincinnati v. Triton
Servs., Inc., 2019-Ohio-3108, 140 N.E.3d 1249 (1st Dist.).
{¶13} On remand, the court held a jury trial. The parties agreed to the
following jury interrogatories:
1) Did Triton encounter differing site conditions throughout the
[sewer] Project?
2) Was the City contractually obligated to compensate Triton for the
differing site conditions encountered throughout the [sewer]
Project?
3) If so, what sum of money, if any, would fairly and reasonably
compensate Triton for its resulting damage?
{¶14} The jury returned a verdict in the city’s favor. The jury interrogatories
reflected that, though the jury found that Triton had encountered differing site
conditions, the city was not required to compensate Triton. The interrogatories did not
specify which contract provisions led the jury to its verdict.
{¶15} This appeal followed.
II. Law and Analysis
{¶16} Triton’s three assignments of error assert that the trial court 1)
erroneously precluded testimony involving damages, 2) failed to properly instruct the
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jury that the city carried the burden of proof involving the early-notice provision of the
contract, and 3) erroneously prohibited evidence regarding whether the city waived
strict compliance with the contract’s notice provisions.
{¶17} We overrule Triton’s three assignments of error because we find that the
two-issue rule applies and renders any alleged error harmless.
{¶18} “[W]hen there are two causes of action raising distinct issues and the
jury returns a general verdict not tested by special interrogatories, a reviewing court
will presume that the jury resolved all issues in favor of the successful party.” Lucarell
v. Nationwide Mut. Ins. Co., 152 Ohio St.3d 453, 2018-Ohio-15, 97 N.E.3d 458, ¶ 46.
Under this rule, if one dispositive issue is tried to a jury and is free from error, any
error related to a separate issue would be harmless. Id.{¶19} The rule also applies to separate defenses. When a defendant presents
two separate defenses and a jury returns a general verdict, any error involving the
second defense is harmless if the other is free from error. See, e.g., Hampel v. Food
Ingredients Specialties, Inc., 89 Ohio St.3d 169, 185, 729 N.E.2d 726 (2000).
Therefore:
[W]here there are two causes of action, or two defenses, thereby raising
separate and distinct issues, and a general verdict has been returned,
and the mental processes of the jury have not been tested by special
interrogatories to indicate which of the issues was resolved in favor of
the successful party, it will be presumed that all issues were so
determined; and that, where a single determinative issue has been tried
free from error, error in presenting another issue will be disregarded.
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Id., quoting H.E. Culbertson Co. v. Warden, 123 Ohio St. 297, 303, 175 N.E. 205(1931).
{¶20} The city raised two independent defenses to Triton’s claims: 1) Triton
did not provide timely notice of its claims, and 2) Triton failed to comply with the
contractual dispute-resolution process.
{¶21} The trial court instructed the jury on both defenses. But Triton’s
appellate brief made no argument about Triton’s alleged failure to comply with the
dispute-resolution process. It alleged error about rulings involving only the early-
notice provision.
{¶22} After the city asserted the two-issue rule in its appellate brief, Triton
argued in its reply brief that Jones had waived all the contractual provisions involving
additional payment for differing site conditions. Triton also argued in its reply brief
that the two-issue rule is inapplicable because there were not two “complete and
independent issues” presented to the jury and the jury did not return a general verdict.
{¶23} Because Triton raised its argument involving Jones’s alleged waiver of
the dispute-resolution provisions for the first time in its reply brief, which it could have
raised before the trial court and in its appellate brief, we need not consider that
argument. State ex rel. Am. Subcontractors Assn., Inc. v. Ohio State Univ., 129 Ohio
St.3d 111, 2011-Ohio-2881, 950 N.E.2d 535, ¶ 40 (“[Relator’s] new argument in its
reply brief is forbidden.”).
{¶24} Triton argues that, because the dispute-resolution process begins with
early notice, the issues were not independent. We disagree. Triton is correct that step
one of the dispute-resolution process presupposes that Triton provided early notice.
But when Majid Samarghandi, Triton’s owner and CEO, testified about engaging in
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the dispute-resolution process, he admitted that Triton never got “out of step number
2” and it “did not go through” the third step of the three-step process.
{¶25} Because the dispute-resolution process is tiered—a party cannot
proceed to step two or three without completing step one—step one presupposing early
notice is irrelevant. The parties had already moved forward and engaged in step two,
which did not involve early notice. In other words, because the parties had completed
the only provision involving early notice, whether Triton gave early notice did not
affect the remainder of dispute-resolution process or whether Triton violated the
contract’s dispute-resolution process.
{¶26} Triton also asserts that because there was not a general verdict, the two-
issue rule cannot apply. We disagree.
{¶27} While the jury’s verdict did bear some similarities to a special verdict in
that the jury answered interrogatories, for the question at issue here (whether the
jury’s determination that the city was not obligated to pay Triton for expenses incurred
due to differing conditions was based on lack of early notice or failure to comply with
the dispute-resolution process), it was a general verdict. The questions posed to and
answered by the jury did not permit this court to test the mental reasoning of the jury.
After all, “[t]he two-issue rule is in essence a rule concerned with prejudice. ‘An
appellant, in order to secure reversal of a judgment against him, must not only show
some error but must also show that * * * the error was prejudicial to him.’ ” Wagner
v. Roche Laboratories, 85 Ohio St.3d 457, 460-461, 709 N.E.2d 162 (1999). And when
a party fails to raise any error involving a dispositive defense, and the jury’s verdict
and interrogatories do not test the jury’s reasoning, the party fails to show that any
other error was prejudicial.
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{¶28} On appeal, Triton did not assert any error involving the jury’s
determination on the dispute-resolution process. The jury interrogatories did not test
upon which of the two dispositive defenses the jury reached its verdict. Therefore, the
two-issue rule applies. We must presume that the jury rendered its verdict in favor of
the city based on Triton’s failure to comply with the dispute-resolution process,
rendering any other alleged error harmless.
III. Conclusion
{¶29} Because we find that the two-issue rule applies, any alleged error is
harmless. Accordingly, we overrule Triton’s assignments of error and affirm the trial
court’s judgment.
Judgment affirmed.
ZAYAS, P.J., and BERGERON, J., concur.
Please note:
The court has recorded its entry on the date of the release of this opinion.
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