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East Ohio Gas Co. Kenmore Construction Co.3/28/2001
p. Medical Ctr. of Akron (1988), 43 Ohio App.3d 201, 204. A third party who simply receives a benefit from an agreement, without more, is only an incidental beneficiary and may not sue under the contract. Visintine & Co. v. New York, Chicago & St. Louis Rd. Co. (1959), 169 Ohio St. 505, 507.
In 1988, the Ohio Supreme Court adopted Section 302 of the Restatement of the Law 2d, Contracts, (1981), 439-440, establishing principles governing intended and incidental beneficiaries. Hill v. Sonitrol of Southwestern Ohio, Inc. (1988), 36 Ohio St.3d 36, 40. Section 302 states:
(1) Unless otherwise agreed between promisor and promisee, a beneficiary of a promise is an intended beneficiary if recognition of a right to performance in the beneficiary is appropriate to effectuate the intention of the parties and either
(a) the performance of the promise will satisfy an obligation of the promisee to pay money to the beneficiary; or
(b) the circumstances indicate that the promisee intends to give the beneficiary the benefit of the promised performance.
(2) An incidental beneficiary is a beneficiary who is not an intended beneficiary.
The Ohio Supreme Court also quoted Comment (e) to Section 302:
"Performance of a contract will often benefit a third person. But unless the third person is an intended beneficiary as here defined, no duty to him is created. *" Id.
Under the circumstances, Kenmore would be considered an intended beneficiary of the locating contracts between East Ohio and CLS, pursuant to Section 302(1)(b) of the Restatement. The sole purpose of these contracts was to satisfy East Ohio's duty to provide information requested by Kenmore as to the location of East Ohio's underground facilities in the planned excavation sites. East Ohio obviously intended to give Kenmore the "benefit of the promised performance" (i.e., information as to the location of the lines) and CLS certainly understood that Kenmore was to be the ultimate recipient of that information.
However, as the magistrate properly concluded, Kenmore waived its right to enforce East Ohio's duty to mark the approximate depth of the lines by undertaking to excavate at the sites, even though Kenmore employees knew that the information provided to them was not reasonably accurate. If Kenmore cannot enforce East Ohio's duty to provide information as to the approximate depth of the lines, it cannot claim loss for CLS' failure to provide such information. Therefore, the trial court did not abuse its discretion in applying the law to the magistrate's factual findings and dismissing Kenmore's third-party beneficiary claim against CLS.
Kenmore's third assignment of error is overruled.
East Ohio's Assignment of Error III
The trial court erred in finding that Kenmore was a third-party beneficiary to the contracts between East Ohio and CLS.
East Ohio also asserts error in the trial court's finding, both in its grant of summary judgment for East Ohio on Kenmore's counterclaims and in the magistrate's decision, that Kenmore was a third-party beneficiary to the contracts between East Ohio and CLS. It is unnecessary to consider this assignment of error, since the issue has been rendered moot by this Court's conclusion that Kenmore waived its right to assert a third-party beneficiary claim against CLS.
III.
Kenmore's first assignment of error is sustained. Kenmore's second and third assignments of error are overruled. East Ohio's first and second assignments of error are overruled. East Ohio's third assignment of error is dismissed as moot. Accordingly, the matter is
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