11.3.4.2 Notes - Isbrandtsen Co., Inc. v. Local 1291 of International Longshoremen’s Assn. | Kessler, Gilmore & Kronman | October 31, 2012

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11.3.4.2 Notes - Isbrandtsen Co., Inc. v. Local 1291 of International Longshoremen’s Assn.

NOTE

1. Reconsider the Restatement First's definitions of "donee" and "creditor" beneficiaries, supra p. 1362. In the principal case Judge Goodrich seems to have assumed that the crucial issue was the relationship between Isbrandtsen and Local 1291. Should he not have focused, instead, on the relationship between Isbrandtsen and Lavino? Would that make a difference? Suppose the action had been brought by Scott Paper Co. instead of by Isbrandtsen?

2. Other courts have been more sympathetic to claims put forward by third parties who allege that they have been injured by A's breach of his contract with B. Thus in Visintine & Co. v. New York, Chicago & St. Louis R.R., 169 Ohio St. 505, 160 N.E.2d 311 (1959), it appeared that both Visintine and the Railroad had been awarded contracts with the State of Ohio in connection with the elimination of a grade crossing. The work to be done by Visintine apparently depended on the prior completion by the Railroad of its part of the project. Visintine brought an action against the Railroad, with counts both in contract and in tort for negligence, to recover loss allegedly caused by the Railroad's improper performance of its contract with the State. The Railroad demurred to both the contract count and the tort count. The court's conclusion, in a per curiam opinion, was as follows:

Taken altogether, we believe the allegations of the petition are sufficient, as against demurrer, to qualify plaintiff as a beneficiary under the contracts between the defendants and the state of Ohio, particularly in view of the fact that the state is immune from suit for any alleged violations of the duties it assumed under its contract with plaintiff.

We agree with the Court of Appeals in its affirmance of the sustaining of the demurrer to the tort cause of action. Tort is based on a duty owed by one party to another. The duty owed here by the defendants was to the state of Ohio, not to the plaintiff. The duty arising out of contract upon  which plaintiff may rely in its first cause of action was that owed to it by the state. If defendants  are liable to plaintiff it is due to a breach of the contracts they made with the state of Ohio and not to the violation of any duty owed directly to the plaintiff upon which a tort action may be based.

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May 21, 2013

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