Justia Contracts Opinion Summaries

The case centers on a long-standing dispute involving three churches over ownership and sale of real property in Los Angeles. Attorney Steven C. Kim represented one of the churches, Central Korean Evangelical Church, which granted him a deed of trust on the property to secure payment of attorney fees. Central Korean had contracted to sell the property to New Life Oasis Church but later reneged, leading to litigation. The trial court ordered Central Korean to honor the sale and expunged Kim’s deed of trust, which was obstructing the transaction. Kim’s client appealed, but the appeal was dismissed for lack of standing, and Kim did not pursue his own appeal. The judgment became final in 2018.Following the final judgment, Kim filed a new lawsuit against New Life Oasis Church and Bank of Hope, seeking a declaration that his deed of trust was still valid and challenging the prior expungement order. New Life and Bank of Hope moved for judgment on the pleadings, arguing that issue preclusion barred Kim from relitigating the validity of his lien. The Superior Court of Los Angeles County agreed and entered judgment against Kim. Additionally, New Life filed a cross-complaint alleging that Kim’s recording of a lis pendens constituted slander of title and abuse of process. After a bench trial, the court ruled in favor of New Life, awarding damages and not addressing Kim’s defense based on the litigation privilege.The California Court of Appeal, Second Appellate District, Division Eight, reviewed the case. It affirmed the trial court’s application of issue preclusion, holding that Kim could not relitigate the validity of his deed of trust. However, it reversed the judgment on the cross-complaint, holding that the litigation privilege protected Kim’s recording of the lis pendens from claims of slander of title and abuse of process. The case was remanded for entry of judgment consistent with these holdings. View "Kim v. New Life Oasis Church" on Justia Law

A physician specializing in physical medicine and rehabilitation was employed by a medical practice under a three-year contract that anticipated partnership if not terminated. After patient and staff complaints about her conduct, the practice proposed a new one-year contract without a partnership track, which she refused to sign. She was then terminated with 90 days’ notice. The physician alleged that her termination was due to age and sex discrimination, as well as retaliation for stating her intent to file an EEOC complaint, and also brought a breach of contract claim.After discovery, the defendants moved for summary judgment in the United States District Court for the Eastern District of New York. A Magistrate Judge recommended granting summary judgment to the defendants on all claims. The District Judge reviewed the report and recommendation (R&R) only for clear error, concluding that the physician’s objections were improper because they repeated arguments made before the Magistrate Judge, and adopted the R&R in full. The physician appealed, arguing that her objections were timely and specific, and that the District Judge should have conducted de novo review.The United States Court of Appeals for the Second Circuit held that the District Court erred in applying only clear error review, as the physician’s objections were proper and required de novo review. However, the appellate court found this error harmless because it reviews summary judgment decisions de novo. On its own review, the Second Circuit concluded that the physician failed to establish a genuine dispute of material fact on her preserved claims of sex discrimination, aiding and abetting discrimination, and retaliation. The court also found that her age discrimination and breach of contract claims were not preserved for appellate review. The Second Circuit affirmed the District Court’s judgment granting summary judgment to the defendants. View "Nambiar v. The Central Orthopedic Group, LLP" on Justia Law

A group of plaintiffs leased a 2,400-acre parcel of undeveloped land in San Luis Obispo County, California, from the predecessor of the defendant, Eureka Energy Company. The lease, originally executed in 1968 and later novated, provided for a 99-year term with an option to renew for another 99 years. The property, known as Wild Cherry Canyon, was historically used for cattle grazing, but the lease itself stated that the premises could be used for “any lawful purpose.” The parties understood that cattle grazing would continue, primarily to reduce wildfire risk rather than for commercial livestock production. In 2018, the plaintiffs exercised their option to renew the lease, but Eureka asserted that the lease was limited to 51 years under California Civil Code section 717, which restricts leases for agricultural purposes.The Superior Court of San Luis Obispo County held a court trial and issued a detailed statement of decision. It found that the lease was for agricultural purposes, specifically cattle grazing, and concluded that section 717 applied, limiting the lease to 51 years. The court entered judgment for Eureka, declaring that the lease expired in 2019 and that the plaintiffs had no further interest in the property. The plaintiffs appealed, arguing that the lease was not for agricultural purposes within the meaning of section 717, given the fire prevention intent.The California Court of Appeal, Second Appellate District, Division Six, reviewed the case. It held that, although cattle grazing generally constitutes an agricultural purpose under section 717, the particular circumstances here—where grazing was intended for fire prevention and not for commercial agriculture—meant the lease was not for agricultural purposes as defined by the statute. The court reversed the trial court’s judgment, finding that the lease was valid beyond the 51-year limit and that the plaintiffs’ leasehold interest should not be forfeited. View "Pacho Limited Partnership v. Eureka Energy Co." on Justia Law

Edward T. Saadi, a licensed attorney proceeding pro se, obtained a $90,000 judgment against Pierre Maroun and Maroun’s International, LLC (MILLC) following a jury verdict in a federal defamation suit. Despite the judgment, Saadi was unable to collect payment for nine years. In 2018, Saadi discovered information suggesting Maroun had transferred $250,000 from his personal account to MILLC, allegedly to evade the judgment. Saadi claimed these funds were used to purchase a condominium titled to MILLC but used as Maroun’s residence, and to pay Maroun’s personal expenses. Saadi initiated proceedings supplementary under Florida law, seeking to void the transfer and recover assets.The United States District Court for the Middle District of Florida allowed Saadi to file an impleader complaint against Maroun and MILLC, asserting claims for fraudulent transfer and actual and constructive fraud under Florida statutes. Saadi also sought sanctions when MILLC failed to produce a representative for deposition, but the district court denied the motion, finding the individual was not a managing agent of MILLC. Ultimately, the district court granted summary judgment for Maroun and MILLC, ruling that Saadi’s claims were time-barred under Florida’s statutes of repose and limitations, and that tolling provisions did not apply. The court also found that the remedies Saadi sought were unavailable under the relevant statutes.On appeal, the United States Court of Appeals for the Eleventh Circuit reviewed the district court’s rulings. Finding that several dispositive questions of Florida law lacked controlling precedent and were subject to conflicting interpretations by Florida’s intermediate appellate courts, the Eleventh Circuit certified five questions to the Florida Supreme Court. The court deferred its decision pending the Florida Supreme Court’s response to the certified questions. View "Saadi v. Maroun" on Justia Law

A law firm sought to recover over $1.7 million in fees and costs for representing the Los Angeles County Sheriff, Alex Villanueva, and the Sheriff’s Department in litigation initiated by the County of Los Angeles. Due to a conflict of interest, the County’s Board of Supervisors offered Villanueva independent counsel, allowing him to select his attorney but reserving discretion over compensation. Villanueva chose the law firm, which entered into an engagement agreement with him. The County, however, sent its own retainer agreement to the firm, which the firm refused to sign. The firm continued its representation but was never paid. After the firm demanded arbitration under its engagement agreement, the County and related plaintiffs filed suit seeking a declaration that no valid agreement to arbitrate existed and an injunction against the arbitration.The Superior Court of Los Angeles County granted a preliminary injunction, then summary judgment for the County plaintiffs, finding the Sheriff lacked authority to enter into the engagement agreement. The court denied the law firm’s post-judgment motion for leave to file a cross-complaint, citing both untimeliness and bad faith. The firm then filed a separate lawsuit against the County and related defendants, asserting breach of contract and related claims. The trial court sustained the County’s demurrer, dismissing the complaint with prejudice on grounds that the claims were compulsory cross-claims in the earlier action and for failure to allege compliance with the Government Claims Act.The California Court of Appeal, Second Appellate District, Division Eight, affirmed both the judgment in the County’s action and the dismissal of the law firm’s separate lawsuit. The court held that the Sheriff did not have authority to retain counsel on his own; only the Board of Supervisors could contract for legal services. The law firm’s claims were barred as compulsory cross-claims and for failure to comply with the Government Claims Act. View "County of Los Angeles v. Quinn Emanuel Urquhart & Sullivan, LLP" on Justia Law

A company based in the Commonwealth of the Northern Mariana Islands (CNMI), which provides computer and networking services, entered into a contract with a California-based distributor of Microsoft products. The CNMI company sought to purchase Microsoft software to fulfill a government contract. After a series of communications and assurances that the software would meet the CNMI government’s specifications, the CNMI company paid over $800,000 to the distributor, which then delivered the software directly to the CNMI government. The software did not conform to the required specifications, leading the government to cancel its contract with the CNMI company and request a refund. The CNMI company, in turn, sought a refund from the distributor, which offered a partial refund minus a cancellation fee. The CNMI company objected and filed suit alleging fraud, breach of contract, promissory estoppel, and unjust enrichment.The United States District Court for the Northern Mariana Islands dismissed the case for lack of personal jurisdiction over the California distributor. The district court relied on a then-binding Ninth Circuit panel decision, which was later vacated and replaced by an en banc decision. The district court did not address whether the claims arose out of the distributor’s contacts with the CNMI or whether exercising jurisdiction would be reasonable.On appeal, the United States Court of Appeals for the Ninth Circuit reversed the district court’s dismissal. The Ninth Circuit held that the CNMI company alleged sufficient facts to establish specific personal jurisdiction over the California distributor. The court found that the distributor purposefully availed itself of the privilege of doing business in the CNMI and purposefully directed its actions toward the CNMI. The court also concluded that the claims arose out of the distributor’s contacts with the CNMI and that exercising jurisdiction would not be unfair or unjust. View "SUPERTECH, INC. V. MY CHOICE SOFTWARE, LLC" on Justia Law

Delta Airlines contracted with Lands’ End to supply new uniforms for its employees, which were manufactured overseas and distributed to approximately 64,000 workers. After the uniforms were issued, many employees reported that the garments transferred dye onto other surfaces and caused a range of health symptoms, including skin irritation and respiratory issues. Two groups of Delta employees filed lawsuits: one group sought damages for property damage and breach of express warranty as intended beneficiaries of the contract between Delta and Lands’ End, while the other group pursued personal injury claims, alleging the uniforms were defectively manufactured or designed and that Lands’ End failed to warn of these defects.The United States District Court for the Western District of Wisconsin consolidated the actions and, after discovery, granted summary judgment in favor of Lands’ End on all claims. For the personal injury claims, the court excluded the plaintiffs’ expert testimony on defect and causation, finding the opinions unreliable under Federal Rule of Evidence 702 and Daubert v. Merrell Dow Pharmaceuticals, Inc. The court also found that the plaintiffs failed to present sufficient evidence that the uniforms were defective or that any defect caused their injuries. On the breach of warranty claim, the court determined that Lands’ End had not breached the contract’s satisfaction guarantee because plaintiffs had not returned their uniforms as required by the contract’s terms.On appeal, the United States Court of Appeals for the Seventh Circuit affirmed the district court’s judgment. The Seventh Circuit held that the exclusion of the plaintiffs’ expert testimony was not an abuse of discretion, as the experts failed to reliably establish defect or causation. The court also held that summary judgment on the breach of warranty claim was proper because the contract’s return requirement was reasonable and not an unlawful limitation on the express warranty. The district court’s judgment was affirmed in full. View "Gilbert v Lands' End, Inc." on Justia Law

A homebuyer entered into an agreement to purchase a property in Titusville, Pennsylvania, and, before completing the purchase, orally contracted with a home inspector to perform an inspection. The inspector delivered a report that did not disclose any structural or foundational issues. Relying on this report, the buyer purchased the property. The following winter, a burst pipe led to the discovery of significant defects, including the absence of a proper foundation and improper ductwork, which had not been disclosed in the inspection report. The buyer filed suit against the inspector more than two years after the report was delivered, alleging violations of the Pennsylvania Home Inspection Law, breach of contract, and violations of the Unfair Trade Practices and Consumer Protection Law.The Court of Common Pleas of Crawford County overruled most of the inspector’s preliminary objections and denied a motion for judgment on the pleadings, finding ambiguity in the statute governing the time to bring actions arising from home inspection reports. The trial court reasoned that the statute could be interpreted as either a statute of limitations or a statute of repose and declined to grant judgment for the inspector. On appeal, the Superior Court reversed, holding that the statute in question was a statute of repose, not a statute of limitations, and that all of the buyer’s claims were time-barred because they were filed more than one year after the inspection report was delivered.The Supreme Court of Pennsylvania reviewed whether the relevant statutory provision, 68 Pa.C.S. § 7512, is a statute of repose or a statute of limitations. The Court held that the statute is a statute of repose, barring any action to recover damages arising from a home inspection report if not commenced within one year of the report’s delivery, regardless of when the claim accrues. The Court affirmed the Superior Court’s judgment. View "Gidor v. Mangus" on Justia Law

This dispute arose from the use of easements on subdivided property in Yellowstone County, Montana. After a series of conveyances, Patti and Steve Schubert owned Tract 7B-2, which benefited from a 30-foot-wide access easement across neighboring Tract 7B-1, owned by Jeremy and Tynagh Toepp. The Schuberts installed a large electric gate, keypad, and package box within the easement, and engaged in activities such as removing vegetation and using heavy equipment, which the Toepps claimed damaged their property and overburdened the easement. The Schuberts also challenged the Toepps’ rights to use a shared well. The parties attempted to resolve their disputes through mediation, resulting in a signed Memorandum of Understanding (MOU), but disagreements persisted over the interpretation and scope of the settlement, particularly regarding the gate and the use of the easement.The Thirteenth Judicial District Court, Yellowstone County, heard cross-motions to enforce the MOU. Sitting without a jury, the District Court found the MOU to be a binding agreement that implied the Schuberts’ encroaching gate could remain in place. The court limited the Schuberts’ use of the access easement to ingress and egress only, prohibited unnecessary removal of vegetation, and awarded attorney fees to the Toepps, finding the Schuberts had unreasonably multiplied the proceedings by insisting on additional terms not included in the MOU.On appeal, the Supreme Court of the State of Montana reversed the District Court’s conclusion that the MOU allowed the encroaching gate to remain, holding that the MOU did not contemplate a gate easement and that the gate constituted an unlawful encroachment requiring removal. The Supreme Court affirmed the District Court’s limitation of the easement to ingress and egress and its award of attorney fees to the Toepps, finding no abuse of discretion. The case was remanded for entry of judgment consistent with these holdings. View "Schubert v. Toepp" on Justia Law

Several healthcare employees in Colorado, including those at the University of Colorado Hospital Authority and South Denver Cardiology Associates, were terminated after refusing to comply with their employers’ COVID-19 vaccination mandates. These mandates, implemented in 2021, required employees to either be vaccinated or obtain a medical or religious exemption. The plaintiffs declined vaccination and did not seek exemptions, resulting in their dismissal.Following their terminations, the plaintiffs filed separate lawsuits in the United States District Court for the District of Colorado, asserting nearly identical claims. They alleged violations of statutory, constitutional, and contractual rights, including claims under 42 U.S.C. § 1983, state-law breach of contract and tort claims, and an implied private right of action under the Food, Drug, and Cosmetic Act. The defendants moved to dismiss on grounds such as sovereign immunity, qualified immunity, and failure to state a claim. The district courts dismissed all claims, finding that the plaintiffs had not adequately pled any viable legal theory. The courts also denied the plaintiffs’ requests to amend their complaints after judgment was entered.On appeal, the United States Court of Appeals for the Tenth Circuit reviewed the dismissals de novo. The court held that none of the statutes cited by the plaintiffs—including the Emergency Use Authorization statute, the PREP Act, and 10 U.S.C. § 980—unambiguously conferred individual rights enforceable under § 1983. The court also found that the constitutional claims, including those based on due process and equal protection, were not adequately pled and that the breach of contract claim was waived for lack of argument. The Tenth Circuit affirmed the district courts’ judgments, holding that the plaintiffs failed to state any claim upon which relief could be granted and that the lower courts did not abuse their discretion in denying leave to amend. View "Timken v. South Denver Cardiology Associates" on Justia Law