Justia Contracts Opinion Summaries
Reach Companies, LLC v. Newsert, LLC
In this breach-of-contract dispute, the United States Court of Appeals for the Eighth Circuit upheld the decision of the District Court of Minnesota, which rejected Reach Companies, LLC's appeal for a new trial after a jury awarded $1,196,364 in damages to Newsert, LLC and David Serata. Reach Companies, a distributor of hand sanitizers, alleged that Newsert, a wholesaler of the same products, continued accepting late shipments despite delays and price fluctuations. Newsert countered that Reach failed to fulfill all but one of its purchase orders, causing Newsert to lose two customers. The court found that the purchase orders were unambiguous with respect to their terms, rejecting Reach’s argument that the "must ship by" dates were simply aspirational. The court also held that the evidence presented at trial was sufficient to prove Newsert's lost profits with reasonable certainty, dismissing Reach's argument that the losses were speculative and didn't account for overhead. Lastly, the court allowed the admission of evidence of prior criminal convictions of Reach’s Vice President for impeachment purposes, as the crimes involved fraud and deceit and were thus relevant to the issues in the case. View "Reach Companies, LLC v. Newsert, LLC" on Justia Law
Johnston v. Flying S Title & Escrow, Inc.
In a dispute arising from a failed subdivision in Missoula County, Montana, a group of property purchasers, led by Gilbert and Judith Johnston, claimed that Flying S Title and Escrow, Inc., breached a purported contract to provide title insurance for the properties they bought. The properties were originally platted as lots, but the purchasers believed that they would eventually be reconfigured into larger parcels. However, the necessary infrastructure was not installed and the amended plat was never recorded, so the parcels never came into existence. The purchasers claimed that pro forma documents provided by Flying S constituted a contract to insure the parcels. The Supreme Court of Montana disagreed, ruling that the pro forma documents did not constitute a contract, but were merely an offer to issue a title insurance policy for the parcels, subject to the terms stated in the documents. The court noted that a contract for title insurance could not exist under the pro forma documents because the parcels, and the title thereto, never existed. Furthermore, the court found that Flying S had not been unjustly enriched by the purchasers' premium payments because it had provided, as agreed, title insurance for the transaction completed by the purchasers to buy the lots. Therefore, the court affirmed the lower court's decision in favor of Flying S Title and Escrow, Inc. View "Johnston v. Flying S Title & Escrow, Inc." on Justia Law
Jiajing (Beijing) Tourism Co. Ltd. v. AeroBalloon USA, Inc.
In this case, decided by the United States Court of Appeals for the First Circuit, the dispute involved Aeroballoon USA, Inc., and its owner Douglas Hase (collectively, Aeroballoon/Hase), and Jiajing (Beijing) Tourism Co., Ltd. (Jiajing). In 2016, Jiajing contracted Aeroballoon for two tethered helium balloons at a total price of $1.8 million. Despite Jiajing making regular payments totaling $1,018,940, Aeroballoon failed to deliver the balloons. An arbitration panel awarded Jiajing $1,410,739.01 plus interest for Aeroballoon's breach of contract. Following the award, Hase dissolved Aeroballoon and Jiajing subsequently filed a complaint seeking enforcement of the arbitration award.The case focused on two counts: fraudulent transfers in violation of the Massachusetts Uniform Fraudulent Transfer Act (UFTA) and unfair business practices under Chapter 93A of the Massachusetts General Laws. The jury awarded Jiajing $1.6 million for each count. The district court later reduced the damages to $1.113 million for each count, a decision unchallenged by either party.The Court of Appeals affirmed the lower court's decision. The court held that the evidence was sufficient to support a finding that Aeroballoon had engaged in fraudulent transfers of at least $1.113 million. The court further held that even a single fraudulent transfer is sufficient to create liability under Chapter 93A, thereby affirming the verdict on the claim of unfair business practices. The court also awarded costs to Jiajing. View "Jiajing (Beijing) Tourism Co. Ltd. v. AeroBalloon USA, Inc." on Justia Law
Millard v. Talburt
This case involved a property dispute between neighbors Robert and Debra Talburt and Miles and Leanne Millard in Idaho. The Millards sought to establish their rights to a disputed tract of land and two easements, as well as breach of contract damages for maintenance of a shared well. The Talburts countered by constructing a fence within the roadway easement, stating they were relocating the roadway easement, and locking the pump house for the shared well. The Supreme Court of Idaho affirmed the district court's judgement in favor of the Millards on their claims related to the easements and ordered the Talburts to remove the fence and cease efforts to block access to the shared well. The court also found the Talburts' attempt to relocate the roadway easement to be unlawful, invalid, and void. However, the district court found that the Millards had abandoned their breach of contract claim and failed to establish a right to the disputed property. The Supreme Court also affirmed the district court's award of a portion of the Millards' attorney fees and costs to them. View "Millard v. Talburt" on Justia Law
Jones v. Solgen Construction
In the case of Maryann Jones v. Solgen Construction, LLC and GoodLeap, LLC, the Court of Appeal of the State of California Fifth Appellate District affirmed the trial court's decision not to compel arbitration. The case concerned a business relationship involving the installation of home solar panels. The appellants, Solgen Construction and GoodLeap, had appealed the trial court's denial of their separate motions to compel arbitration, arguing that the court had erred in several ways, including by concluding that no valid agreement to arbitrate existed.Jones, the respondent, had filed a lawsuit alleging fraudulent misrepresentation, fraudulent concealment, negligence, and violations of various consumer protection laws. She contended that she had been misled into believing she was signing up for a free government program to lower her energy costs, not entering into a 25-year loan agreement for solar panels. The appellants argued that Jones had signed contracts containing arbitration clauses, but the court found that the appellants had failed to meet their burden of demonstrating the existence of a valid arbitration agreement. The court also held that the contract was unenforceable due to being unconscionable.The appellate court affirmed the trial court's decision, rejecting the appellants' arguments that an evidentiary hearing should have been held and that the court had erred in its interpretation of the evidence and the law. It found that the trial court had not abused its discretion and that its finding that the appellants failed to meet their burden of proof was not erroneous as a matter of law. View "Jones v. Solgen Construction" on Justia Law
Trindade v. Grove Services, Inc.
Paulo Trindade, a former employee of Grove Services, Inc., sued his previous employer for breach of contract and violations of the Massachusetts Wage Act, claiming he had been underpaid on his sales commission compensation for the years 2014, 2015, and 2016. Following a bench trial, the United States District Court for the District of Massachusetts ruled in part for Trindade and in part for Grove, awarding Trindade $330,597 in damages. Both parties appealed. The United States Court of Appeals for the First Circuit affirmed the lower court's judgment. The Court of Appeals agreed with the district court's conclusion that Trindade's amended complaint, which included a claim for unpaid wages for 2016, related back to his original complaint, making the claim timely under Massachusetts law. The Court of Appeals also concluded that the district court was correct in its decision to award the damages it did, including an amount for the late payment and underpayment of Trindade's 2016 commission. View "Trindade v. Grove Services, Inc." on Justia Law
West Palm Beach Firefighters’ Pension Fund v. Moelis & Company
In the case of West Palm Beach Firefighters' Pension Fund v. Moelis & Company, the plaintiff, a stockholder of Moelis & Company (the "Company"), challenged the validity of certain provisions in a Stockholder Agreement between the Company and its CEO, Ken Moelis. The agreement gave Moelis extensive pre-approval rights over the Company's board of directors' decisions, the ability to select a majority of board members, and the power to determine the composition of any board committee. The plaintiff argued that these provisions violated Section 141(a) of the Delaware General Corporation Law (DGCL), which mandates that the business and affairs of a corporation be managed by or under the direction of a board of directors, except as otherwise provided in the DGCL or in the corporation's certificate of incorporation.The Court of Chancery of the State of Delaware agreed with the plaintiff, holding that the Pre-Approval Requirements, the Board Composition Provisions, and the Committee Composition Provision in the Stockholder Agreement were facially invalid under Section 141(a) of the DGCL. The court found that these provisions effectively transferred the management of the corporation to Moelis, contrary to Section 141(a). The court reasoned that while Delaware law generally favors private ordering, the ability to contract is subject to the limitations of the DGCL, including Section 141(a). The court emphasized that a provision may be part of a corporation's internal governance arrangement, and thus subject to Section 141(a), even if it appears in a contract other than the corporation's charter or bylaws.However, the court found that certain provisions were not facially invalid, including Moelis’ right to designate a number of directors, the requirement for the Company to nominate Moelis’ designees, and the requirement for the Company to make reasonable efforts to enable Moelis’ designees to be elected and continue to serve. View "West Palm Beach Firefighters' Pension Fund v. Moelis & Company" on Justia Law
Stowe Aviation, LLC et al. v. Agency of Commerce & Community Development
In this case, the plaintiffs, Stowe Aviation, LLC and Stowe Airport Investment, LP, appealed from a denial of their motion to reopen a breach-of-contract case with the Vermont Agency of Commerce and Community Development. The plaintiffs had signed a memorandum of understanding (MOU) with the Agency in 2014, outlining their intention to develop and expand the Morrisville-Stowe State Airport using funds secured through the EB-5 program. However, the Agency later transferred its obligations under the MOU to the Department of Financial Regulation (DFR) without informing the plaintiffs, leading to the failure of the airport project.The plaintiffs filed a complaint against the Agency, alleging that the Agency breached its contract by failing to perform under the MOU and by transferring its obligations to the DFR without notice. The trial court dismissed the claims, and the case was closed. The plaintiffs then moved to reopen the case and amend their complaint, but the trial court denied their motion. The plaintiffs appealed this order.The Supreme Court of Vermont reversed the order and remanded the case, holding that the trial court had abused its discretion in denying the plaintiffs' motion to reopen the case. The Supreme Court reasoned that plaintiffs could potentially obtain relief to cure a pleading deficiency under Vermont Rule of Civil Procedure 59(e), and it was inappropriate for the trial court to deny relief simply because plaintiffs did not request leave to amend in their opposition papers before the court entered judgment. On remand, the plaintiffs must demonstrate a valid basis to vacate the previously entered judgment to prevent manifest injustice before they can file their amended complaint. View "Stowe Aviation, LLC et al. v. Agency of Commerce & Community Development" on Justia Law
SEALY EMERGENCY ROOM, L.L.C. v. FREE STANDING EMERGENCY ROOM MANAGERS OF AMERICA, L.L.C.
In a dispute between Sealy Emergency Room, L.L.C., Dr. Kannappan Krishnaswamy, and Free Standing Emergency Room Managers of America, L.L.C. (FERMA), along with its doctors, the Supreme Court of Texas ruled on two issues regarding the finality and appealability of judgments. The case arose from a contractual dispute between Sealy ER and FERMA, with both parties filing various claims and counterclaims against each other. The trial court granted FERMA's motion for partial summary judgment, dismissing all of Sealy ER's claims, and later granted FERMA's motion to sever these claims into a separate action.The Supreme Court held that when claims are severed into separate actions, the test for finality applies to each action separately. Thus, any claims that remain pending in the original action are not relevant in deciding whether there is a final judgment in the severed action. Procedural errors in ordering a severance do not affect the finality of the judgment or appellate jurisdiction.Secondly, the court held that when a party seeks attorney’s fees as a remedy for a claim under a prevailing-party standard, a summary judgment against the party on that claim also disposes of its fee request. Therefore, the court’s failure to specifically deny the fee request will not prevent finality if the court’s orders in fact dispose of all parties and claims.In this case, the court concluded that the trial court’s order granting partial summary judgment disposed of all parties and claims that were later severed into a new action. As a result, the severed action became final when the severance order was signed, and Sealy ER timely appealed. The court of appeals erred in holding that it lacked appellate jurisdiction, so the Supreme Court reversed and remanded for the court of appeals to address the merits of the appeal. View "SEALY EMERGENCY ROOM, L.L.C. v. FREE STANDING EMERGENCY ROOM MANAGERS OF AMERICA, L.L.C." on Justia Law
Abreu v. Howard University
The case involves Pablo Abreu, a student who was expelled from Howard University College of Medicine. Abreu appealed his expulsion, arguing that the university violated his rights under Title III of the Americans with Disabilities Act (ADA) and the Rehabilitation Act of 1972 by refusing to grant him additional opportunities to retake a required examination, in light of his diagnosed test-taking-anxiety disability. The district court dismissed his complaint, applying a one-year statute of limitations and ruling that his claims were time-barred.The United States Court of Appeals for the District of Columbia Circuit disagreed with the lower court's application of a one-year statute of limitations to Abreu’s ADA and Rehabilitation Act claims. The court pointed to its decision in another case, Stafford v. George Washington University, in which it concluded that a three-year statute of limitations should apply to civil rights claims under Title VI of the Civil Rights Act of 1964. Since Abreu's ADA and Rehabilitation Act claims were also civil rights claims alleging discrimination, the court ruled that the three-year statute of limitations should apply. This made Abreu’s claims timely since he filed the suit less than three years after his expulsion.The court then remanded the case back to the district court for further proceedings on the ADA and Rehabilitation Act claims. However, it affirmed the dismissal of Abreu's contractual claims, agreeing with the district court that Abreu failed to state a claim for breach of contract. View "Abreu v. Howard University" on Justia Law