Background
In June 2022, homeowners Tatiana Kogan and Nikolay Kutsenko contracted with Weaver Construction and Roofing, LLC to replace their roof in Pepper Pike, Ohio for $22,850. The homeowners paid a $12,650 down payment and agreed to a red metal roof with exposed fasteners. Weaver Construction was not registered to do business in Pepper Pike as required by municipal ordinance, and neither party obtained a required building permit or approval from Pepper Pike’s Architectural Board of Review before commencing work.
When construction began, the building inspector discovered the violations and shut down the job. By that point, the old roof had been substantially removed and some new material installed. Although Weaver Construction later registered as a contractor, the Architectural Board of Review refused to approve the red metal roofing material. Weaver Construction abandoned the project, and a different contractor eventually installed a permissible shingle roof. The homeowners received a $10,000 recovery on a performance bond but received no refund from Weaver Construction for the $12,650 deposit.
The homeowners filed suit for breach of contract, Consumer Sales Practices Act (CSPA) violations, negligence, and unjust enrichment. The trial court granted partial summary judgment on breach of contract and part of the CSPA claim, then held a bench trial with an advisory jury to determine damages and remaining issues.
The Court’s Holding
The Ohio Court of Appeals affirmed the trial court’s judgment in all respects. The court held that Weaver Construction breached its contractual duty to perform in a workmanlike manner by commencing work without being registered to do business in Pepper Pike and without obtaining the required permits and Board approval. The failure to register constituted a per se deceptive trade practice under the CSPA.
Most significantly, the court found that the failure to register was the proximate cause of the homeowners’ damages. The trial court reasoned that had Weaver Construction registered and become familiar with Pepper Pike’s procedures, the homeowners would have had the opportunity to obtain Board approval before spending money or beginning work. The Board would have rejected the red metal roofing material in advance, allowing the homeowners either to select different materials or to hire a different contractor. Instead, Weaver Construction’s violation of the registration ordinance prevented them from discovering the Board’s restrictions until after work had begun and money had been spent.
The court awarded compensatory damages of $2,650 (the $12,650 deposit minus the $10,000 bond recovery), plus attorney fees of $21,692 under R.C. 1345.09(F)(2). The court rejected the homeowners’ request for treble damages and noneconomic damages, finding insufficient evidence of intangible loss or mental anguish. The court also held Al Weaver, the individual contractor, personally liable under CSPA provisions for his personal actions in directing the violation, rejecting any requirement to pierce the corporate veil.
Key Takeaways
- Contractors who fail to comply with local licensing, permit, and approval requirements before commencing work breach the implied duty to perform in a workmanlike manner, exposing them to contract liability even if the client’s chosen materials would ultimately have been rejected by local authorities.
- Failure to register as a contractor constitutes a per se deceptive trade practice under the CSPA, with no requirement to prove deceptive intent or actual reliance by the consumer.
- Proximate cause of CSPA damages can be established where the contractor’s regulatory violation prevented the homeowner from discovering material problems or obtaining Board approval before incurring expenses.
- Appellants who fail to provide a trial transcript and trial exhibits on appeal bear the burden of demonstrating error, with courts presuming regularity in the trial court’s proceedings when the record is incomplete.
- Individual contractors can be held personally liable for CSPA violations under their personal actions, without requiring a showing that the corporate veil should be pierced.
Why It Matters
This decision reinforces that contractors cannot ignore local licensing and permitting requirements, even if they later obtain licenses or if the underlying project would have faced obstacles regardless. The court’s proximate-cause analysis is particularly significant: it holds that the contractor’s violation of registration ordinances is the legal cause of the homeowner’s damages because the violation prevented the homeowner from discovering material problems in advance. Contractors who proceed without proper registration, permits, or Board approvals face liability not only for failing to complete the work, but for all damages flowing from that failure to comply with local law.
The decision also carries important procedural consequences for appellants in construction disputes. Appellants who do not provide trial transcripts and exhibits on appeal cannot challenge the trial court’s factual findings; courts will presume the trial court heard sufficient evidence to support those findings. This standard makes it essential for contractors facing adverse judgments to preserve the complete trial record if they wish to pursue an appeal.