Masiongale Electrical-Mechanical, Inc. v. Construction One, Inc.

Summary

The Ohio Supreme Court interpreted Ohio's Prompt-Payment Act, R.C. 4113.61, concerning a contractor's ability to withhold payment from a subcontractor. The court held that breaches of lien-waiver and forum-selection clauses do not constitute disputed liens or claims involving the subcontractor's work, labor, or materials, and therefore do not justify withholding payment. The court affirmed the award of prejudgment interest and attorney fees to the subcontractor.

Holdings

1. A breach of a lien-waiver or forum-selection clause in a construction contract does not create a disputed lien or claim involving the work or labor performed or material furnished by the subcontractor within the meaning of R.C. 4113.61(A)(1).
2. Construction One could not withhold amounts relating to bond premiums and attorney fees incurred or anticipated as a result of Masiongale's lien-waiver and forum-selection breaches.
3. The court declined to address Construction One's remaining proposition of law concerning attorney fees and dismissed it as having been improvidently accepted.

Questions Presented

1. Whether a subcontractor's breach of lien-waiver or forum-selection provisions creates a disputed lien or claim involving the work, labor, or materials furnished by the subcontractor under R.C. 4113.61(A)(1).
2. Whether a contractor may withhold anticipated bond premiums and attorney fees incurred in resolving an improperly filed lien and lawsuit under R.C. 4113.61(A)(1).
3. Whether Construction One's remaining proposition of law concerning the attorney-fee award should be decided.

Disposition

affirmed