Justia Contracts Opinion Summaries

This dispute concerned whether an international trader of bunker fuel was entitled to a maritime lien on a vessel under the Commercial Instrument and Maritime Lien Act (CIMLA). The M/V LILA SHANGHAI (the Vessel) was a gross tonnage bulk carrier owned by Autumn Harvest Maritime Co. Autumn Harvest time-chartered the Vessel to Bostomar Bulk Shipping Pte Ltd. (Bostomar). The contract foreclosed charterers from unilaterally placing liens on the Vessel; in the event of "any dispute" between Autumn Harvest and Bostomar about the Vessel and their respective obligations, the parties would refer the matter to arbitration. Bostomar sub-chartered the Vessel to Medmar Inc. (Medmar). While sailing to India, the Vessel needed bunkers to complete its journey. Costas Mylonakis, an employee of Windrose Marine, contacted Appellant Sing Fuels Pte. Ltd. (Sing Fuels) to order the Vessel’s bunkers. Sing Fuels transmitted its bunker contract only to Mylonakis’s e-mail address affiliated with Windrose Marine. Mylonakis never returned any memorialized document from Medmar. Sing Fuels exclusively communicated with Mylonakis for this transaction, considered Mylonakis to be Medmar’s fuel broker, and never spoke directly with Medmar. Mylonakis also never communicated with Medmar, he conferred instead with a mysterious entity called M.A.C. Shipping. Medmar returned the Vessel to Bostomar in August 2019, with Sing Fuels still awaiting payment for July bunkers. By October 2019, payment for the July bunkers was still outstanding, so Sing Fuels sent Autumn Harvest a notice of nonpayment; Autumn Harvest refused to pay. In the wake of collapsed negotiations, Sing Fuels paid the physical supplier of the July bunkers. Without knowing where to turn after Medmar’s payment default on the bunkers, and its discussions with Autumn Harvest exhausted, Sing Fuels waited until the Vessel docked in the United States and then availed itself of US courts to recoup payment. The Fourth Circuit Court of Appeals determined the bunker trader failed to show that it procured the vessel’s fuel “on the order of the owner or a person authorized by the owner,” under CIMLA, therefore, it affirmed the district court’s judgment denying the maritime lien. View "Sing Fuels Pte Ltd. v. M/V LILA SHANGHAI" on Justia Law

Ila Reid appealed a district court’s summary judgment dismissal of her breach of contract claim against Primerica Life Insurance Company (“Primerica”). Reid brought her claim after Primerica filed an interpleader action to resolve competing claims to her late husband Garvin Reid’s life insurance beneficiary proceeds. She contended Primerica acted unfairly in multiple ways to create the controversy and thus the district court should not have permitted Primerica to use interpleader as a shield against her breach of contract claim. Finding no reversible error, the Eighth Circuit Court of Appeals affirmed the district court’s summary judgment order in favor of Primerica. View "Primerica Life Insurance Co. v. Reid" on Justia Law

Triller Inc., a social media company was being sold to a group of owners, including Carnegie Technologies, Inc. Prior to the sale, Triller executed a promissory note in favor of Carnegie and then immediately assigned the note to a group of “legacy” owners—including Carnegie—as part of the deal’s closing. After the note was defaulted, Carnegie sued Triller to collect the amounts due. Triller claimed that it had no obligations under the note because it had been assigned, resulting in novation. The district court rejected Triller's novation defense and Triller appealed.The Fifth Circuit affirmed, finding that the plain meaning of the agreement was silent on the extinction of any obligation between Triller and Carnegie. The laws of both California and Texas require clear evidence illustrating the parties' intent to replace an earlier agreement, and the agreement's merger clause precludes evidence of a contemporaneous or earlier agreement. Thus, the court held that Triller failed to raise an issue of material fact regarding whether its obligations under the note were extinguished. View "Carnegie Technologies. v. Triller" on Justia Law

Fountain of praise, a church, leased space to Central Care Integrated Health Services. Shortly after the execution of the lease, the relationship soured when the parties disagreed on the frequency and amount of rent payments. Eventually, Fountain of Praise terminated the lease and successfully evicted Central Care from the premises.Subsequently, Central Care filed for Chapter 11 reorganization. Central Care then sued Fountain of Praise in state court, claiming breach of contract and unjust enrichment. Fountain of Praise then removed the case to bankruptcy court as an adversary proceeding. The bankruptcy court entered judgment in favor of Fountain of Praise, finding that any breach was excusable due to Central Care's failure to make timely rent payments and that Central Care lacked the requisite interest in the property for an unjust enrichment claim.Central Care appealed, and the district court judge assigned to the case reassigned the case to a magistrate judge who affirmed the bankruptcy court's judgment.On appeal, the Fifth Circuit vacated the magistrate judge's order, finding that the district court improperly authorized referral of the appeal from a bankruptcy court decision to a magistrate judge. Under 28 U.S.C. Section 158, appeals from a bankruptcy court must be heard either by the district court or a panel of bankruptcy court judges. View "South Central v. Oak Baptist" on Justia Law

American Express National Bank (“AmEx”) filed suit for breach of contract in Mississippi state court to recover $2,855.74 of unpaid credit card debt incurred on Plaintiff's account. Plaintiff contended an unknown person incurred this debt fraudulently. Plaintiff then filed Fair Credit Reporting Act (“FCRA”) claims against AmEx and other defendants in Mississippi state court. The district court denied AmEx’s motion to compel arbitration.   The Fifth Circuit vacated the decision of the district court and remanded for reconsideration in the first instance in light of Forby v. One Techs., L.P and Morgan v. Sundance, Inc. The court held that these cases were decided on the same day and after the district court’s ruling. Forby clarified the test for waiver by a party of the right to compel arbitration and reiterated that waiver analysis occurs on a claim-by-claim basis. In addition, Morgan addressed this and other sister circuits’ tests for waiver by a party of the right to compel arbitration. The court explained that although it can apply subsequent precedent to cases before it, “[a]s a court for review of errors, we are not to decide facts or make legal conclusions in the first instance." Thus, the court’s task is to review the actions of a trial court for claimed errors. View "Barnett v. American Express National" on Justia Law

Public Risk Management of Florida (“PRM”) Munich Reinsurance America, Inc. (“Munich”) for breach of contract and sought declaratory relief that Munich is obligated by the parties’ reinsurance agreement (“the Reinsurance Agreement”) to reimburse PRM for the defense and coverage it provided to an insured in an underlying lawsuit. Munich counter-claimed for a declaratory judgment stating that it has no duty to reimburse PRM, and the district court granted that relief. On appeal, PRM argues, inter alia, that the Reinsurance Agreement contained a “follow the fortunes” clause, which forbids a reinsurer “from second guessing” an insurer’s “good faith decision” to pay a claim to the insured.   The Eleventh Circuit affirmed the grant of summary judgment holding that the district court correctly decided that Munich had no duty to reimburse PRM for its defense and indemnification of the City in the underlying Section 1983 suit. The court explained that The Reinsurance Agreement contains language that is plainly inconsistent with the follow the-fortunes doctrine. Accordingly, the district court properly rejected the doctrine’s application in this case. Further, the court held that it will not infer the application of the follow-the-fortunes doctrine in a reinsurance agreement where the agreement’s plain and unambiguous language is inconsistent with the doctrine. Applying this rule the court concluded that it would be inconsistent with the plain, unambiguous terms of the Reinsurance Agreement to infer that Munich should be bound by PRM’s coverage decision. View "Public Risk Management of Florida v. Munich Reinsurance America, Inc." on Justia Law

The Louisiana Supreme Court granted review in this case to determine whether a stamped signature on an uninsured/underinsured motorist (“UM”) coverage rejection form, affixed by the administrative assistant of the corporate insured’s owner and president, complied with the statutory requirement that the UM form be signed by the named insured or his legal representative. Because the stamped signature was affixed on behalf of the legal representative and not by the legal representative himself, the Supreme Court agreed with the court of appeal that the lack of prior written authorization to the administrative assistant rendered the UM form invalid. View "Havard v. JeanLouis, et al." on Justia Law

The First Circuit affirmed the judgment of the district court granting Defendant's motion to dismiss this case brought against him by Plaintiff, his previous employer, for lack of personal jurisdiction, holding that the district court did not err.Plaintiff brought this lawsuit against Defendant in the District of New Hampshire, alleging that he breached his employment contract and violated a non-solicitation of employees clause by encouraging three of Defendant's employees to quit their employment and join him at his new company. The district court dismissed the case for lack of personal jurisdiction. The First Circuit affirmed, holding that the requirements for personal jurisdiction were not met in this case. View "Vapotherm, Inc. v. Santiago" on Justia Law

The co-tenancy provision in the parties’ lease required a shopping center to have either: (1) three anchor tenants; or (2) 60 percent of the space leased, and, if it did not, Tenant-respondent JoAnn Stores, LLC was permitted to pay “Substitute Rent.” In 2018, Jo-Ann informed JJD it intended to start paying Substitute Rent effective July 1, 2018, because the co-tenancy provision was not met after two anchor tenants closed. Landlord-appellant JJD-HOV Elk Grove, LLC (JJD) responded that the co-tenancy provision was an unenforceable penalty under the holding in Grand Prospect Partners, L.P. v. Ross Dress for Less, Inc., 232 Cal.App.4th 1332 (2015). Jo-Ann contended Grand Prospect was distinguishable and the co-tenancy provision was enforceable. JJD and Jo-Ann filed competing complaints for declaratory relief and cross-motions for summary judgment. The trial court found the co-tenancy provision was enforceable, and thus granted Jo- Ann’s motion, denied JJD’s, and entered judgment accordingly. JJD appealed. The Court of Appeal declined to follow the rule announced in Grand Prospect here, and instead held that this case was governed by the general rule that courts enforce contracts as written. The Court therefore agreed with the trial court’s conclusion that the co-tenancy provision at issue in this case was enforceable, and affirmed the judgment. View "JJD-HOV Elk Grove, LLC v. Jo-Ann Stores" on Justia Law

Torgerson Properties, Inc. ("TPI") develops and operates hotels, restaurants, and conference centers in Minnesota and Florida. It was covered by an all-risk property insurance policy issued by Continental Casualty Co. from May 1, 2019, through May 1, 2020. the policy’s Business Interruption and Civil Authority/Ingress-Egress provisions. The Business Interruption clause “covers against loss resulting from necessary interruption of business caused by direct physical loss of or damage to covered property.”   TPI filed a claim under the policy for lost business income during the COVID pandemic. After Continental denied the claim, TPI sued for breach of contract. Continental moved to dismiss for failure to state a claim. The district court granted Continental’s motion, and TPI appealed. The Eighth Circuit affirmed, holding that the district court was correct to dismiss TPI’s breach of contract action for failure to state a claim.   The court reasoned that insurance provisions covering “direct physical loss of or damage to property” are not triggered unless “there [is] some physicality to the loss or damage of property.” Oral Surgeons, P.C. v. Cincinnati Ins. Co., 2 F.4th 1141 (8th Cir. 2021) (relying on Minnesota law).  TPI tried to distinguish this case from Oral Surgeons by alleging that the virus was actually present on its property. However, TPI failed to show that causal link. The contamination did not cause TPI’s business interruption; the shutdown orders did. TPI would have been subject to the exact same restrictions even if its premises weren’t contaminated. And the cause of TPI’s business interruption—governmental orders alone—is not a direct physical loss. View "Torgerson Properties, Inc. v. Continental Casualty Company" on Justia Law