CONSTRUCTION LAWLETTERS

FOR INDUSTRY PROFESSIONALS, MANAGERS, TRADES & SUPPLIERS

J. NORMAN STARK, ATTORNEY-AT-LAW

JURIS DOCTOR, B. ARCHITECTURE, B.F.A

Vol. 2001-6  June, 2001

DAMAGES TO REAL PROPERTY

Traditionally, Ohio law placed stringent limits on the amount of damages a property owner could recover for damages incurred to real property.   A brief review of Ohio court opinions illustrates the dramatic shifts in the law providing recovery for damages to real property...

In a case dating back to 1923, (Ohio Collieries Co. v. Cocke), the Ohio Supreme Court held: "If the injury is of a permanent or irreparable nature, the measure of damages is the difference in the market value of the property as a whole, including the improvements thereon, before and after the injury.  If the injury is susceptible of repair, the measure of damages is the reasonable cost of restoration, plus reasonable compensation for the loss of the use of the property between the time of the injury and the restoration, unless such cost of restoration exceeds the difference in the market value of the property before and after the injury, in which case the difference in market value becomes the measure."

Accordingly, in situations where repairs can be made, the Supreme Court of Ohio clearly intended to limit damages to the difference in the fair market value of the property before and after the injury, even if the cost of repairs exceeded that figure.

Ten years later the Ohio Supreme Court modified its position on this issue, holding: "It is difficult to state a rule for measuring damages equally applicable in all cases involving either the total or partial destruction of a building…fundamentally it is the purpose of the law to afford to the person damaged compensation for the loss sustained."

By the 1970’s at least one Ohio court moved towards a test of" reasonableness." In the case of  Thatcher v. Lane Constr. Co. (1970), the Tenth District Court of Appeals stated: “The general rule that the measure of damages for injury to real estate shall not exceed the difference in the market value of the entire tract immediately before and immediately after the injury is not an arbitrary or exact formula to be applied in every case without regard to whether its application would compensate the injured party fully for losses which are the proximate result of the wrongdoer’s conduct.”

In a more recent Ohio appellate case, the Court of Appeals for Trumbull County recognizing the necessary evolution of damages, determined that where the owner of an apartment building alleged that his roof collapsed due to the negligence of a builder, the builder could be held liable for any lost rent and the cost of repairs to the building as well.

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Author:  J. NORMAN STARK is an Attorney-at-Law, a Registered Architect, (AIA, NCARB) Registered Landscape Architect, Interior Designer, Planner and Senior Appraiser (ASA), admitted to practice law before the Bar of Ohio, the US District Courts, Ohio and Illinois (Central Dist.), the US Court of Appeals, and the United States Supreme Court. He has had experience in business, Construction, Real Property, Litigation and Construction-Legal Project and Crisis Management.

 


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