Category Archives: Business & Civil Litigation

Occasionally, we get calls from clients who have received a notice from the Courts to show up for Jury Duty.  Usually, they relate that they have busy lives and responsibilities and don’t want to take time to serve.  Do they have to appear?

First, from a legal perspective, yes, you do have to show.  The summons form the Court is a legal notice that is ignored at your peril.  You could be arrested and serve time for contempt of Court if you fail to comply.

Second, if the dates you have been summoned to Jury Duty are temporarily inconvenient, it can be fairly easy to schedule your service to another time.  This is because the Jury Commissioner is glad to have cooperation from responsible citizens.  It is, of course, responsible citizens who have jobs, civic responsibilities, and family obligationss and it is that type of citizen that the officials are delighted to see serve on jurys.

Further, if your life circumstances — work travel schedule, health issues, family duties —  simply makes it impossible to serve, it is possible to be formally excused from jury service.  This can be handled informally, or by formal motion to the Court.

However, we advise clients to make every attempt to cooperate in serving on jury duty.  It is always interesting.  And, even though you typically are summoned to serve for two weeks, most jurors really serve just a few days.  And finally, consider if we take from jury duty the responsible citizens who hold jobs, raise families and have active civic involvement, then to whom are we relegating jury duty?  Judges, prosecutors, and defense attorneys want intelligent, engaged, active, jurors who have diverse life experiences to whom to present and argue the tough cases.  If those with your unique background refuse to serve, aren’t the participants deprived of your life experience and knowledge?

Consider serving if you possibly can fit it in..

The statute of limitations for a medical malpractice claim is one year. In other words, you will lose your right to seek compensation for medical malpractice if you fail to file your claim within the one-year period. While this is simple enough on its face, the right to recover on a medical malpractice claim often turns on precisely when that one-year statute begins to run. A recent case out of Ohio’s Fifth District Court of Appeals explains how Ohio courts determine this important date.

In Kelly v. Aultman Physician Center, Jaquayla Kelly sued a physician group for medical malpractice claiming that she suffered complications arising from the physicians’ negligent treatment. The physicians had placed a Mirena intrauterine device (“IUD”) in Kelly’s uterus for contraceptive purposes in June of 2008. Over the next 18 months, Kelly intermittently returned to the physicians complaining of abdominal pain. Eventually, in April of 2010, it was discovered that the IUD had pierced Kelly’s uterine cavity. As a result, Kelly underwent a total abdominal hysterectomy, removal of both ovaries and fallopian tubes, bilateral gutter abscess removal, appendectomy, and removal of multiple pelvic abscesses. Kelly then developed septic shock and multi-organ system failures, ultimately requiring her to spend four days on a ventilator in the intensive care unit and another two weeks in the hospital before she recovered.
In September of 2012, Kelly saw a legal advertisement on television advising viewers of complications related to the use of the Mirena IUD device. Kelly sought legal advice based on the commercial and her lawyers were able to obtain medical records documenting the alleged malpractice in early 2013. Kelly then filed her medical malpractice claim in March of 2013.

The trial court dismissed Kelly’s medical malpractice claim, finding that she filed the claim beyond the one-year statute of limitations period under R.C. 2305.113. On appeal, Kelly argued that the one-year statute of limitations did not begin to run until she acquired medical records containing evidence of the malpractice in early 2013. Thus, she claimed that the statute had not elapsed when she filed the claim in March of 2013.

The Fifth District Court of Appeals noted that the one-year period commences to run (a) when the patient discovers, or should have discovered, the injury, or (b) when the physician-patient relationship for that condition terminates, whichever occurs later. The appellate court further noted that the Ohio Supreme Court previously held that under the discovery rule, a “cognizable event” triggers the running of the statutory time. A “cognizable event” is something that should alert a reasonable patient that an improper medical procedure, treatment or diagnosis has taken place. Constructive knowledge of facts, rather than actual knowledge of their significance, is enough to start the statute running. The Fifth District explained that “the statute of limitations in a medical malpractice case will be triggered even if a potential plaintiff has not uncovered all relevant facts to constitute her cause of action to trigger the running of the statute of limitations. Thus, the occurrence of a cognizable event makes it incumbent upon that individual to investigate his or her case completely.”

In applying this analysis to Kelly’s case, the court determined that the discovery of the complications caused by the IUD and the resulting major surgery in April of 2010 was the cognizable event that triggered the statute of limitations. According to the court, the events in April 2010, “should have given Kelly reason to believe or at least investigate her claim that malpractice may have been committed in the placement of the IUD or during her treatment of her complaints with the IUD.” Because Kelly filed her medical malpractice claim in 2013 (after the one-year statute expired in April 2011) the Fifth District affirmed the trial court’s dismissal of Kelly’s medical malpractice claim.

This case highlights the grave consequences that may befall a patient who delays pursuing a medical malpractice claim. A person injured by a physician’s malpractice must commence his or her lawsuit within one year of the date that person discovered, or should have discovered reason to believe that malpractice may have been committed. If you believe you may have suffered an injury as a result of medical malpractice it is imperative that you seek representation immediately. The process of obtaining medical records and an independent review of the records takes time, and generally must be done before a lawsuit can be commenced. Our litigation team can obtain the necessary information to evaluate your case, and will diligently seek compensation from negligent parties. Please do not hesitate to contact us if you have reason to believe you have suffered from medical malpractice.

Many commercial contracts have provisions mandating binding arbitration of disputes.  These contractual provisions have powerful consequences for the parties accepting them.

As a matter of due process, under our legal system, everyone has access to the Courts for resolution of disputes, unless they have waived that right, for example, by agreeing to submit disputes to a private arbitration process.

Arbitration is generally a non-governmental process for the resolution of disputes. In arbitration, a single arbitrator or panel of arbitrators acts in the role of a “judge” deciding disputes.  This is in contrast to mediation in which a third party “neutral” attempts to convince the parties to settle the dispute between or among them. A chosen arbitration process can be either “binding,” meaning that the parties are bound by the decision of the arbitrator, or non-binding, in which case the decision essentially is merely advisory.

We advise clients that arbitration is typically both the first and last stop on the railroad of dispute resolution for two main reasons:

1. First, an arbitration clause is generally enforceable in commercial contracts.  (In consumer contracts, perhaps not so much.)  As such, the arbitration process will be mandatory for all dispute resolution.  O.R.C Section 2711.01 provides:

“A provision in any written contract…to settle by arbitration a controversy that subsequently arises out of the contract…shall be valid, irrevocable, and enforceable, except upon grounds that exist at law or in equity for the revocation of any contract.

1. Second, an arbitration decision is not appealable in the manner that a court judgment is appealable.  For court judgments, appeals can be based upon an error of law or even that the judgment was “against the manifest weight of evidence.”  It is not quite a “second bite at the apple,” but it can be close.       Arbitration awards, on the other hand, can only be challenged on the basis of some corruption, fraud or partiality in the arbitration process, a very difficult hurdle indeed.  Thus, regardless of how outrageous an arbitration award may be, it generally is final and very difficult to appeal. See, O.R.C Section 2711.010.

So, consider agreeing to arbitration clauses carefully. You may not be able to reconsider that decision.

In construction projects, the question often arises as to when subcontractors are due payment from the general contractor. A disruption in the flow of payment from the owner to the general contractor, and then to the subcontractors is often the cause of litigation in construction disputes. In entering into a contract to provide services to a general contractor, the subcontractor must be aware of the payment clause in its agreement in order to appropriately assess its risk in proceeding with supplying its services for the project.

Subcontractor agreements often contain either a “pay-if-paid” clause or a “pay-when-paid” clause. A “pay-when-paid” clause requires the general contractor to pay the subcontractor regardless of whether the general contractor receives payment from the owner. Conversely, a “pay-if-paid” clause requires the general contractor to pay the subcontractor only if the owner pays the general contractor.

The Ohio Supreme Court recently clarified the distinction between these payment clauses in Transtar Elec, Inc. v. AEM Elec. Servs. Corp., Slip Opinion No. 2014-Ohio-3095. In Transtar, the subcontractor filed suit seeking payment of over $44,000 that was never paid by the general contractor or the owner. The general contractor only paid a portion of the work completed by the subcontractor because the general contractor had not received full payment from the owner.

The subcontract at issue contained the following language:

The Contractor shall pay to the Subcontractor the amount due under subparagraph (a) above only upon the satisfaction of all four of the following conditions: (i) the Subcontractor has completed all of the Work covered by the payment in a timely and workmanlike manner, …(ii) the Owner has approved the Work, …(iii) the Subcontractor proves to the Contractor’s sole satisfaction that the Project is free and clear from all liens….and (iv) the Contractor has received payment from the Owner for the Work performed by Subcontractor. RECEIPT OF PAYMENT BY CONTRACTOR FROM OWNER FOR WORK PERFORMED BY SUBCONTRACTOR IS A CONDITION PRECEDENT TO PAYMENT BY CONTRACTOR TO SUBCONTRACTOR FOR THAT WORK.

The general contractor relied on the provision that payment from the owner was a “condition precedent” to payment by the contractor, to support its decision not to pay the subcontractor for all of its work. The subcontractor argued that the payment clause was actually a “pay-when-paid” provision, which required the general contractor to pay regardless of whether it received full payment from the owner.

The Sixth District sided with the subcontractor, finding that the payment provision did not contain adequate language to create a “pay-if-paid” clause. The Sixth District reasoned that in order to shift the risk of owner nonpayment to the subcontractor, the payment provision must clearly and unambiguously demonstrate the parties’ intent to do so.

The general contractor appealed the decision to the Ohio Supreme Court, which reversed the Sixth District’s decision. The Ohio Supreme Court found that by using the language “condition precedent” in the payment clause, the parties intended that the risk of the owner’s nonpayment shift to the subcontractor rather than remain with the general contractor. In other words, by making payment from the owner to the general contractor a “condition precedent” to payment from the general contractor to the subcontractor, the parties had agreed to a “pay-if-paid” clause. As a result, the subcontractor could not force the general contractor to pay the balance due under the contract.

The Transtar decision highlights the importance of fully understanding the terms of a construction contract in order to properly plan for the risks that may confront a general contractor or a subcontractor in undertaking a construction project. A party to a construction contract must be able to identify whether the contract contains a “pay-if-paid” clause, or a “pay-when-paid” clause, and must fully understand how each clause shifts the risk of nonpayment.

In addition to understanding the payment terms in its contract, subcontractors should also remember to preserve their mechanic’s lien rights to further protect their ability to receive payment for their work. Under Ohio Revised Code 41113.62(E), a subcontractor does not waive its mechanic’s lien rights by entering into a “pay-if-paid” contract. Thus, when choosing to provide services subject to a “pay-if-paid” clause, a subcontractor should comply with Ohio’s Mechanics Lien law in order to provide the best possible chance of receiving full payment for its services.

The Finney Law Firm has represented owners, general contractors, and subcontractors in construction projects. Our attorneys are experienced in negotiating contracts and in litigating construction disputes. Please contact us if we can assist you with your legal needs.