Court Opinion

ID: 2747099
Source: CourtListenerOpinion
Date Created: 2014-10-31 02:46:26.898918+00
Date Added: 2024-06-11T11:25:18.689955
License: Public Domain

[Cite as Hanson Aggregates Davon v. J & H Reinforcing & Structural Erectors, Inc., 2014-Ohio-4832.]

                          IN THE COURT OF APPEALS OF OHIO
                             FOURTH APPELLATE DISTRICT
                                   SCIOTO COUNTY

HANSON AGGREGATES DAVON, :
LLC,                              :
                                  :
        Plaintiff-Appellant,      :   Case No. 14CA3608
                                  :
        vs.                       :
                                  :   DECISION AND JUDGMENT
J & H REINFORCING AND             :   ENTRY
STRUCTURAL ERECTORS, INC., :
et al.,                           :
                                  :
        Defendants-Appellees.     :   Released: 10/29/14
_____________________________________________________________
                              APPEARANCES:

Dave Lackey, Scherner & Sybert LLC, Powell, Ohio, for Appellant.

Donald W. Gregory and Timothy A. Kelley, Kegler Brown Hill & Ritter
LPA, Columbus, Ohio, for Appellees.
_____________________________________________________________

McFarland, J.

        {¶1} Appellant, Hanson Aggregates Davon, LLC, appeals the trial

court’s summary judgment decision granted in favor of Appellees, J&H

Reinforcing and Structural Erectors, Inc. and Ohio Farmers Insurance

Company. On appeal, Appellant raises one assignment of error, contending

that the trial court erred when it concluded that reasonable minds could

come to one conclusion, and that conclusion was that Appellant failed to
Scioto App. No. 14CA3608                                                      2

properly serve its notice of furnishing upon Appellant, J&H Reinforcing and

Structural Erectors, Inc.

      {¶2} Because we conclude that Appellant was required to demonstrate

that Appellee, J&H Reinforcing and Structural Erectors, Inc. (J&H), actually

received the notice of furnishing that was sent via certified mail, but was

unable to provide a written evidence of receipt, and because the evidence

properly considered by the trial court indicated J&H did not actually receive

the notice of furnishing, we find no genuine issue of material fact exists

which precluded summary judgment. As such, Appellant's sole assignment

of error is overruled. Accordingly, the trial court's grant of summary

judgment in favor of Appellees is affirmed.

                                   FACTS

      {¶3} This appeal involves the grant of summary judgment in favor of

Appellees, J&H Reinforcing and Structural Erectors, Inc. and Ohio Farmers

Insurance Company, regarding a bond claim made for payment of materials

furnished in the construction of a public improvement project, namely the

construction of Clay Pre K-12 public school. Appellant, Hanson Aggregates

Davon, LLC, filed suit against Appellees, claiming payment had not been

made for material provided to J&H during the construction of the school.
Scioto App. No. 14CA3608                                                        3

J&H was the principal contractor and Ohio Farmers issued the bond to

guarantee payment to the subcontractors and other materialmen.

      {¶4} During the project, J&H arranged for subcontractor, Kenny

Huston, to perform masonry work. Huston in turn arranged for Appellant,

also a subcontractor, to supply masonry materials. Appellant arranged for

the masonry block to be manufactured by Oberfields, Inc. The record

reflects that Oberfields manufactured the materials and then held the

materials at their yard and Huston would call periodically to arrange to pick

up quantities as needed for the project.

      {¶5} At some point, it became apparent that far more block was

ordered than was needed for the project. The record indicates that it was

discovered that there was a significant miscalculation in the masonry block

ordered for the project and that, as a result, nearly twice the amount of block

needed was manufactured by Oberfields. It also appears from the record that

Huston calculated and ordered the block and that Hanson has paid

Oberfields for the block. After Hanson met with Huston to discuss the

problem of the excess block that remained at Oberfields and to determine a

payment plan whereby Huston would pay Hanson approximately $150,000

for the block, Huston abandoned the project and subsequently went into

receivership.
Scioto App. No. 14CA3608                                                          4

      {¶6} On February 10, 2012, Appellant filed a complaint against

Appellees to recover against the bond that was issued for the public

construction project, claiming there was $184,390.22 due for materials

ordered by Huston. Appellees denied liability under the bond. After the

parties completed discovery and conducted depositions, and after an initial

motion for summary judgment filed by Appellant was denied by the trial

court, Appellees filed a motion for summary judgment on January 10, 2014.

Appellant opposed the motion and also filed a cross motion for partial

summary judgment. On February 19, 2014, the trial court issued an entry

granting summary judgment in favor of Appellees based upon its

determination that Appellant was unable to show that Appellees actually

received a notice of furnishing of the materials at issue, proper service of

which is a prerequisite to asserting a statutory lien for materials. It is from

this decision that Appellant now brings its timely appeal, setting forth a

single assignment of error for our review.

                         ASSIGNMENT OF ERROR

“I.   THE TRIAL COURT ERRED IN ITS ENTRY WHEN IT
      CONCLUDED THAT REASONABLE MINDS COULD COME TO
      ONE CONCLUSION, AND THAT CONCLUSION WAS THAT
      HANSON AGGREGATES DAVON, LLC FAILED TO PROPERLY
      SERVE ITS NOTICE OF FURNISHING UPON J & H
      REINFORCING AND STRUCTURAL ERECTORS, INC.”
Scioto App. No. 14CA3608                                                        5

                                 LEGAL ANALYSIS

      {¶7} In its sole assignment of error, Appellant essentially contends

that the trial court erred in granting summary judgment in favor of

Appellees. More specifically, Appellant contends that the trial court erred in

concluding that no genuine issue of material fact existed with respect to the

question of whether or not Appellant properly served a notice of furnishing

upon Appellees in accordance with R.C. 1311.261 and 1311.19. Appellant

raises two issues under his sole assignment of error. First, Appellant

questions whether service of the notice of furnishing was complete when it

was mailed by certified mail, pursuant to R.C. 1311.19, such that actual

evidence of receipt by J&H was unnecessary. Secondly, Appellant

questions whether genuine issues of material fact exist with respect to the

service of the notice of furnishing which should have precluded summary

judgment.

      {¶8} When reviewing a trial court's decision on a motion for summary

judgment, we conduct a de novo review governed by the standard set forth

in Civ.R. 56. Comer v. Risko, 106 Ohio St.3d 185, 2005-Ohio-4559, 833

N.E.2d 712, ¶ 8. Summary judgment is appropriate when the movant has

established (1) that there is no genuine issue of material fact, (2) that

reasonable minds can come to but one conclusion, and that conclusion is
Scioto App. No. 14CA3608                                                         6

adverse to the nonmoving party, with the evidence against that party being

construed most strongly in its favor, and (3) that the moving party is entitled

to judgment as a matter of law. Bostic v. Connor, 37 Ohio St.3d 144, 146,

524 N.E.2d 881 (1988); citing Harless v. Willis Day Warehousing Co., 54

Ohio St.2d 64, 66, 375 N.E.2d 46 (1978); See also, Civ.R. 56(C).

      {¶9} The burden of showing that no genuine issue of material fact

exists falls upon the party who moves for summary judgment. Dresher v.

Burt, 75 Ohio St.3d 280, 294, 75 Ohio St.3d 280, 662 N.E.2d 264 (1996).

To meet its burden, the moving party must specifically refer to “the

pleadings, depositions, answers to interrogatories, written admissions,

affidavits, transcripts of evidence, and written stipulations of fact, if any,

timely filed in the action,” that affirmatively demonstrate that the

nonmoving party has no evidence to support the nonmoving party's claims.

Civ.R. 56(C); See also Hansen v. Wal–Mart Stores, Inc., 4th. Dist Ross No.

07CA2990, 2008-Ohio-2477, ¶ 8. Once the movant supports the motion

with appropriate evidentiary materials, the nonmoving party “may not rest

upon the mere allegations or denials of the party's pleadings, but the party's

response, by affidavit or as otherwise provided in this rule, must set forth

specific facts showing that there is a genuine issue for trial.” Civ.R. 56(E).
Scioto App. No. 14CA3608                                                           7

“If the party does not so respond, summary judgment, if appropriate, shall be

entered against the party.” Id.

      {¶10} Appellant claims that it was not required to prove that J&H

actually received its notice of furnishing since it sent the notice by certified

mail. Appellant further argues that because it followed the “statutorily-

preferred” method of service of its notice of furnishing by sending it

certified mail, return receipt requested, and because it was not returned as

undelivered, unclaimed or refused, that service was complete upon mailing

an no inquiry into whether J&H actually received it is necessary. For the

following reasons, we disagree with Appellant's argument.

      {¶11} R.C. 153.56 provides, in pertinent part, as follows:

      “(A) Any person to whom any money is due for labor or work

      performed or materials furnished in a public improvement as

      provided in section 153.54 of the Revised Code, at any time

      after performing the labor or work or furnishing the materials,

      but not later than ninety days after the completion of the

      contract by the principal contractor and the acceptance of the

      public improvement * * * shall furnish the sureties on the bond,

      a statement of the amount due to the person.
Scioto App. No. 14CA3608                                                      8

      (B) A suit shall not be brought against sureties on the bond until

      after sixty days after the furnishing of the statement described

      in Division (A) of this section. * * *

      (C) To exercise rights under this section, a subcontractor or

      materials supplier supplying labor or materials that cost more

      than thirty thousand dollars, who is not in direct privity of

      contract with the principal contractor for the public

      improvement, shall serve a notice of furnishing upon the

      principal contractor in the form provided in section 1311.261 of

      the Revised Code.” (Emphasis added.)

R.C. 1311.261 addresses requirements and the form to be used for the notice

of furnishing when the materials have been provided for public improvement

projects. R.C. 1311.05 provides similar information regarding mechanics

liens for private construction projects.

      {¶12} R.C. 1311.19 details the service requirements applicable to

notices of furnishing as well as other documents required to be served under

Chapter 13 of the Revised Code and provides, in pertinent part, as follows:

      “(A) Except as otherwise provided in section 1311.11 of the

      Revised Code and division (C) of this section, any notice,
Scioto App. No. 14CA3608                                                   9

      affidavit, or other document required to be served under this

      chapter shall be served by one of the following means:

      ***

      (2) Certified or registered mail, overnight delivery service, hand

      delivery, or any other method which includes a written evidence

      of receipt[.]" (Emphasis added).

R.C. 1311.19 further provides in section (B) as follows:

      "(B) For purposes of this chapter, service is complete upon

      receipt by the party being served except as provided in division

      (H) of section 1701.07 of the Revised Code and except, for the

      purposes of sections 1311.05 and 1311.261 of the Revised

      Code, if service of a notice of furnishing is made by certified

      mail, service is complete on the date of the mailing. If the

      service is attempted upon an owner, part owner, or lessee, or

      designee, at the address contained in the notice of

      commencement required by section 1311.04 of the Revised

      Code, and if the notice, affidavit, or other document is returned

      unclaimed or refused, service is complete when first

      attempted." (Emphasis added).
Scioto App. No. 14CA3608                                                      10

      {¶13} Appellant argues that based upon a plain reading of the statute,

because it sent the notice of furnishing by certified mail, service was

complete upon mailing and thus it was unnecessary to demonstrate J&H's

actual receipt of the notice of furnishing. Appellant primarily relies upon the

reasoning set forth in VP Consolidated Holdings, Inc. v. Hunt, et al., 6th.

Dist. Erie No. E-08-025, 2009-Ohio-1129, in support of its argument. In VP

Consolidated Holdings, the court did, in fact, hold that "when a notice of

furnishing for either a private or public improvement is sent by certified

mail, service is considered complete on the date of mailing." Id. at ¶ 17.

VP, however, is factually distinguishable from the case sub judice in that the

principal contractor did not claim that it never received the notice, but rather

the issue seemed to involve the timeliness of the receipt of the notice.

      {¶14} Appellant argues in the alternative that if it was required to

show actual receipt on the part of J&H, genuine issues of material fact exist

regarding service of the notice of furnishing. More specifically, Appellant

argues that because the notice was not returned as undelivered, refused or

unclaimed, it is entitled to an inference that the notice of furnishing was

received by J&H. In support of its argument, Appellant cites the “mailbox

rule” which is incorporated into R.C. 1311.19(B).
Scioto App. No. 14CA3608                                                    11

      {¶15} As set forth above, R.C. 1311.19(B) provides as follows, in

pertinent part:

      "For purposes of this chapter, service is complete upon receipt

      by the party being served * * *, for the purposes of sections

      1311.05 and 1311.261 of the Revised Code, if service of a

      notice of furnishing is made by certified mail, service is

      complete on the date of the mailing."

Under the “mailbox rule,” there is a rebuttable presumption that a letter

mailed to the correct address is presumed to be received in due course.

Cantrell v. Celotex Corp., 105 Ohio App.3d 90, 94, 663 N.E.2d 708 (1st

Dist.1995).

      {¶16} However, we find a different provision contained in R.C.

1311.19 to be more applicable to the facts presently before us. Specifically,

section (C) of R.C. 1311.19, provides as follows:

      "A notice, affidavit, or other document to which this division

      applies is presumed to have been received three days after the

      date of the mailing of the notice, affidavit, or other document,

      unless a written acknowledgment, receipt, or other evidence

      provides proof to the contrary." (Emphasis added).
Scioto App. No. 14CA3608                                                         12

Thus, although section (B) does seem to incorporate the mailbox rule, the

mailbox rule creates a rebuttable presumption of actual delivery. As argued

by Appellant, similar to the mailbox rule, R.C. 1311.19(C) contains an

exception to the automatic presumption of receipt after three days where

"other evidence provides proof to the contrary."

      {¶17} In this case, Appellees filed an affidavit in support of their

motion for summary judgment averring that J&H did not actually receive a

notice of furnishing from Appellant. As discussed in more detail below, the

affidavit constituted proper evidence in support of Appellees' motion for

summary judgment. As a result, we find the exception contained in R.C.

1311.19(C) to be applicable and as such any presumption of receipt due to

the fact that the notice was sent via certified mail is rebutted.

      {¶18} We are further persuaded that this is the correct result by

Appellees’ argument that "the provisions of R.C. 1311.19(A)(2) requiring

written proof of receipt would be rendered superfluous and meaningless[]"

if Appellant's proposition that it is 'not required to prove that J&H actually

received its notice of furnishing since it sent service via certified mail' were

accepted." As urged by Appellant itself, a court interpreting a statute must

look to the language of the statute to determine legislative intent. State v.

Osborne, 4th Dist. Jackson No. 05 CA2, 2005-Ohio-6610, ¶ 18. Courts
Scioto App. No. 14CA3608                                                       13

should give effect to the words of the statute and should not modify an

unambiguous statute by deleting or inserting words; that is, we have no

authority to ignore the plain and unambiguous language of a statute under

the guise of statutory interpretation. State v. McDonald, 4th Dist. Ross No.

04CA2806, 2005-Ohio-3503, ¶ 11. The statute clearly contemplates that

mailing a document by certified mail will provide written evidence of

receipt. Thus, we cannot conclude that requiring Appellant to provide

written evidence of receipt is contrary to a plain reading of the statute, when

actual receipt is disputed by Appellees.

      {¶19} Appellant further contends that J&H never actually

demonstrated failure of service in that its only evidence came from Mark

Rollins, a project manager employed by J&H towards the end of the

construction project. Appellant challenges Rollins’ actual knowledge of

whether or not the notice of furnishing was received just by looking at the

project file and concluding it did not contain a notice of furnishing. Thus,

Appellant challenges the trial court’s reliance upon the affidavit of Rollins in

support of Appellees’ motion for summary judgment, claiming it was not

based upon personal knowledge.

      {¶20} When deciding a motion for summary judgment, a court may

only consider affidavits that are based upon personal knowledge of the
Scioto App. No. 14CA3608                                                        14

affiant. Appellant argues that the information contained within Rollins’

affidavit was not within his personal knowledge. A review of the record

calls into question whether Appellant clearly raised this issue at the trial

court level. Although Appellant mentioned this position in the summary

judgment filings, Appellant never filed a formal motion to strike the

affidavit or made clear its position that the trial court should not consider it.

However, even if Appellant failed to adequately object to the affidavit

below, we must nevertheless be mindful of the language of Civ.R. 56(E) set

forth above which states “ * * * summary judgment, if appropriate, shall be

entered against the party.” (Emphasis added). Thus, summary judgment

should only be granted when appropriate, under Civ.R. 56. As such, we will

review the issue raised by Appellant.

      {¶21} “For evidentiary material attached to a summary judgment

motion to be considered, the evidence must be admissible at trial.” See

Civ.R. 56(E) and Pennisten v. Noel, 4th. Dist. Pike No. 01CA669, 2002 WL

254021, *2. Although we conduct a de novo review of the trial court's

decision to grant summary judgment, we review the court's rulings on the

admissibility of evidence for an abuse of discretion. Lawson v. Y.D. Song,

M.D., Inc., 4th. Dist. Scioto No. 97 CA 2480, 1997 WL 596293, *3 (Sept.

23, 1997); See also, State v. Sage, 31 Ohio St.3d 173, 510 N.E.2d 343, at
Scioto App. No. 14CA3608                                                      15

paragraph two of the syllabus (1987). The term “abuse of discretion”

implies that the court's attitude is unreasonable, arbitrary, or unconscionable.

State v. Adams, 62 Ohio St.2d 151, 157, 404 N.E.2d 144 (1980). When

applying the abuse-of-discretion standard, a reviewing court may not

substitute its judgment for that of the trial court. Berk v. Matthews, 53 Ohio

St.3d 161, 169, 559 N.E.2d 1301 (1990).

      {¶22} Civ.R. 56(E) states: “Supporting and opposing affidavits shall

be made on personal knowledge, shall set forth such facts as would be

admissible in evidence, and shall show affirmatively that the affiant is

competent to testify to the matters stated in the affidavit.” “Personal

knowledge” is “ ‘[k]nowledge gained through firsthand observation or

experience, as distinguished from a belief based on what someone else has

said.’ " Bonacorsi v. Wheeling & Lake Erie Ry. Co., 95 Ohio St.3d 314,

2002-Ohio-2220, 767 N.E.2d 707, ¶ 26; quoting Black's Law Dictionary (7th

Ed.Rev.1999) 875. It is “ ‘knowledge of factual truth which does not

depend on outside information or hearsay.’ ” Residential Funding Co.,

L.L.C. v. Thorne, Lucas App. No. L-09-1324, 2010-Ohio-4271, ¶ 64;

quoting Modon v. Cleveland, 9th. Dist. Medina No. 2945-M, 1999 WL

1260318, *2 (Dec. 22, 1999) .
Scioto App. No. 14CA3608                                                     16

      {¶23} Rollins’ affidavit specifically stated that his averments were

based upon his personal knowledge, as a Division Manager and Project

Manager for J&H, and his review of documents kept in the ordinary course

of business. Rollins further averred as follows:

      “Upon a reasonably-diligent investigation of J&H’s records and

      files kept in the court of ordinary business, J&H did not receive

      a copy of the Notice of Furnishing dated December 9, 2010,

      attached to Hanson’s Complaint as Exhibit E and to Hanson’s

      Motion for Summary Judgment as Exhibit H.”

Importantly, there was nothing in Appellant’s memorandum opposing

summary judgment or Appellant’s motion for partial summary judgment,

with the exception of the affidavit of Dequila Blackmon which averred that

“[u]pon information and belief, the notice of furnishing was received by

J&H” that defeated Rollins’ averment of personal knowledge of the lack of a

notice of furnishing in the project records and files kept in the ordinary

course of business by J&H. Despite Blackmon’s averment, we agree with

Appellees that Blackmon had no personal knowledge of whether J&H

actually received the notice of furnishing. Further, in the absence of

Appellant being able to produce written evidence of receipt, and light of the
Scioto App. No. 14CA3608                                                       17

Rollins' affidavit stating the notice was not received, such receipt cannot be

inferred.

      {¶24} Nonetheless, in some instances, “personal knowledge may be

inferred from the contents of an affidavit * * *.” Carter v. U–Haul Internatl.,

10th. Dist. Franklin No. 09AP-310, 2009-Ohio-5358, ¶ 10; Flagstar Bank

F.S.B. v. Diehl, 5th. Dist. Ashland No. 09COA034, 2010-Ohio-2860, ¶ 25.

Here, Rollins’ averment, based upon his position as a project manager with

J&H sufficiently permits an inference of personal knowledge on his part that

the project files and records kept by J&H did not contain a notice of

furnishing by Appellant. Additionally, as pointed out by Appellees,

although there may have been former J&H employees with more extensive

knowledge about J&H’s normal receipt and filing practices with regard to

notices of furnishing which could have either defeated Appellees’ motion for

summary judgment or better supported Appellant’s partial motion for

summary judgment, Appellant did not subpoena those individuals for

depositions.

      {¶25} Coupled with Rollins’ deposition testimony that the normal

practice at J&H is for the accounting person to put notices of furnishing in

the project file when received, we believe that the trial court properly

considered Rollins’ affidavit as evidence that J&H did not receive the notice
Scioto App. No. 14CA3608                                                         18

of furnishing. Thus, we conclude that Appellees’ affidavit filed in support

of its motion for summary judgment complies with Civ.R. 56(E). As such,

the trial court did not err or abuse its discretion in relying on the affidavit in

reaching its decision to grant summary judgment in favor of Appellees.

      {¶26} In light of our determination that R.C. 1311.19 does require

proof of receipt of the notice of furnishing on the part of the principal

contractor by virtue of the language contained in section (A)(2) which

specifies “written evidence of receipt,” and because Appellant offered no

evidence to overcome the affidavit of Mark Rollins, which was properly

considered by the trial court, we find no merit in the issues and arguments

raised by Appellant in support of its sole assignment of error. Further, even

construing the evidence in a light most favorable to Appellant, we find no

genuine issues of material fact exist which should have precluded summary

judgment in favor of Appellees.

      {¶27} As set forth above, the proper service of a notice of furnishing

is a prerequisite to being able to assert a statutory lien claim. Construing the

evidence in a light most favorable to Appellant, Appellant was unable to

demonstrate proof of receipt by Appellees. Although R.C. 1311.19(B) does

state that service is complete upon mailing when a notice is sent via certified

mail, R.C. 1311.19(A)(2) contemplates that written evidence of receipt will
Scioto App. No. 14CA3608                                                     19

be able to be provided. Appellant could not provide that. Further, as stated

above, R.C. 1311.19(C) provides that a notice is presumed to have been

received three days after the date of the mailing “unless a written

acknowledgment, receipt, or other evidence provides proof to the contrary.”

Here, there was “proof to the contrary” in the form of the Rollins’ affidavit,

as well the fact that Appellant could provide no proof of receipt.

Accordingly, Appellant’s sole assignment of error is overruled and the

decision of the trial court is affirmed.

                                                JUDGMENT AFFIRMED.
Scioto App. No. 14CA3608                                                       20

                           JUDGMENT ENTRY

     It is ordered that the JUDGMENT BE AFFIRMED and that the
Appellees recover of Appellant any costs herein.

      The Court finds there were reasonable grounds for this appeal.

      It is ordered that a special mandate issue out of this Court directing
the Scioto County Common Pleas Court to carry this judgment into
execution.

       Any stay previously granted by this Court is hereby terminated as of
the date of this entry.

      A certified copy of this entry shall constitute the mandate pursuant to
Rule 27 of the Rules of Appellate Procedure.

Hoover, J.: Concurs in Judgment and Opinion.
Harsha, J.: Concurs in Judgment Only.

                                 For the Court,

                          BY: _____________________________
                              Matthew W. McFarland, Judge

                         NOTICE TO COUNSEL

      Pursuant to Local Rule No. 14, this document constitutes a final
judgment entry and the time period for further appeal commences from
the date of filing with the clerk.