In 1999, Allstate reorganized its business and terminated the at-will employment contracts of about 6,200 sales agents, offering them conversion to independent contractor status; $5,000 and an economic interest in their accounts, to be sold to buyers approved by Allstate; severance pay equal to one year’s salary; or severance pay of 13 weeks’ pay. Employees who chose independent contractor status received a bonus of at least $5,000, were not required to repay any office-expense advances, and acquired transferable interests in their business two years after converting. All employees who chose not to convert and left the company were bound by noncompetition covenants in their original contracts. As a condition of becoming independent contractors, agents were required to sign a release waiving existing legal claims against Allstate. The Equal Employment Opportunity Commission sued, claiming that the company violated federal anti-retaliation laws. The district court reversed. The Third Circuit affirmed, noting the settled rule that employers can exchange consideration for releases of claims and that EEOC established neither protected activity nor an adverse action. View "Equal Emp't Opportunity Comm'n v. Allstate Ins. Co" on Justia Law

Travelers Home and Marine Insurance Company ("Travelers") appealed the grant of summary judgment in favor of Dianne and Martin Gray in the Grays' action arising from injuries Dianne suffered as the result of a motor-vehicle accident. In 2010, Lawana Coker and Dianne were involved in a motor-vehicle accident in Elmore County; Coker was without motor-vehicle insurance at the time of the accident. Two years later, the Grays filed in the trial court a three-count complaint naming as defendants Coker and Travelers and a fictitiously named defendant. Travelers answered the complaint, denying the material allegations therein and asserting certain affirmative defenses. Coker, however, failed to answer the complaint. In 2013, the Grays moved the trial court to enter a default judgment in their favor and against Coker, requesting that the trial court assess damages in the amount of $500,000 for Dianne and $50,000 for Martin. The Grays' motion requested no relief as to Travelers. Shortly thereafter, the Grays filed a new summary-judgment motion in which, for the first time, they sought relief against Travelers. The Grays did not base their summary judgment motion against Travelers on the ground that there was no genuine issue of fact as to whether tortious conduct by Coker caused them to suffer injury. Instead, they based their summary-judgment motion against Travelers solely on the fact that they previously had obtained a default judgment against Coker. In this regard, the Grays argued that they were entitled to a judgment as a matter of law against Travelers because, they said, "Travelers as a party defendant had notice and adequate opportunity to intervene and present any defenses and arguments necessary to protect its position with respect to the entry of or the amount of damages in the Default Judgment. By failing to do so, Defendant Travelers legally is bound by the judgment." After review, the Supreme Court reversed: because Travelers as the Grays' UM carrier, was not bound by the default judgment entered against Coker, Travelers was not required to submit evidence in opposition to a motion for a summary judgment that relied solely on that default judgment. Consequently, the trial court erred in entering a summary judgment in favor of the Grays and against Travelers. View "Travelers Home & Marine Ins. Co. v. Gray" on Justia Law

A Milwaukee County General Ordinance prospectively eliminated Medicare Part B premium reimbursement upon retirement for employees who did not retire before retirement dates established by Milwaukee County. Plaintiffs were of retirement age, had fifteen years of credited service to the County, but did not retire by the dates established in the ordinance. Plaintiffs claimed that the ordinance impaired their vested contract right to reimbursement of Medicare Part B premiums when they retire. The court of appeals granted summary judgment to Milwaukee County. The Supreme Court affirmed, holding (1) the County did not abrogate a vested contract right when it prospectively modified a health insurance benefit it offered for employees who had not yet retired; (2) County employees have a vested contract right to Medicare Part B premium reimbursement when they fulfill all three criteria for its payment, including actual retirement; and (3) because Plaintiffs did not meet all three criteria in this case, they did not fulfill the requirements necessary to establish a vested contract right to reimbursement. View "Wis. Fed’n of Nurses and Health Prof’ls v. Milwaukee County" on Justia Law

Give Kids the World, Inc. is a non-profit organization that provides free vacations to seriously ill children and their families at its resort village. Stacy and Eric Sanislo were vacationing at the village with their seriously ill child when Stacy sustained injuries. The Sanislos brought this negligence action against Give Kids the World. Give Kids the World moved for summary judgment on its affirmative defense that the Sanislos signed releases that precluded an action for negligence. The trial court denied the motion. After a jury trial, judgment was entered in favor of the Sanislos. The Fifth District Court of Appeal reversed the trial court’s denial of summary judgment, concluding that an exculpatory clause in the liability release form signed by the Sanislos was effective to bar the negligence action despite the absence of express language referring to release of Give Kids the World for its own negligence or negligent acts. The Supreme Court approved of the Fifth District’s decision, holding that the absence of the terms “negligence” or “negligent acts” in an exculpatory clause does not render the agreement per se ineffective to bar a negligence action. View "Sanislo v. Give Kids The World, Inc." on Justia Law

In 2004, K-Con entered into a contract with the federal government to construct a Coast Guard building in Port Huron Michigan for $582,641. Once K-Con finished, the government imposed liquidated damages of $109,554 for tardiness of 186 days in completion. KCon sued, seeking remission of the liquidated damages on two grounds—that the contract’s liquidated-damages clause was unenforceable and that KCon was entitled to an extension of the completion date. KCon also requested additional compensation based on work performed in response to government requests that K-Con alleges amounted to contract changes. The Court of Federal Claims held that the contract’s liquidated damages clause was enforceable; that K-Con did not comply with the written-notice precondition for invoking the contract clause governing changes; and that K-Con’s claim for an extension on the completion date must be dismissed for lack of jurisdiction. The Federal Circuit affirmed. K-Con failed to comply with the changes clause, and its after-the-fact speculations about what would have happened had it complied do not create a genuine dispute of material fact regarding whether it should be excused for its failure. View "K-Con Bldg. Sys., Inc. v. United States" on Justia Law

During a highway paving project a storm caused recently applied primer to emulsify in rainwater. The oil splashed onto passing vehicles, causing damage. The vehicle owners brought claims against the State, which the State paid. A.M. Welles, Inc. (Welles), the general contractor on the job, reimbursed the State for what it paid to the vehicle owners. The State then sued Liberty Mutual Fire Insurance Co. (Liberty), the insurer for the job, seeking indemnification for the costs that Welles did not cover. Welles, in turn, sued the subcontractors for the project, Montana Materials, Inc., RSJ, Inc., and GLJ, Inc. (collectively, “Jensen”), seeking indemnification under the subcontract. The district court granted summary judgment for Jensen on Welles’s indemnification claim and dismissed the State’s action against Liberty for failure to prosecute. The Supreme Court vacated and remanded, holding that the district court (1) erred in denying Welles’s motion for summary judgment, as Welles was entitled to indemnification under the subcontract; and (2) abused its discretion by dismissing the State’s action against Liberty for failure to prosecute. Remanded. View "A.M. Welles, Inc. v. Mont. Materials, Inc." on Justia Law

Christopher Walton and Tammara Duhn hired Jacob Hatch and his construction company (collectively, Hatch) as the general contractor to build a custom home in a subdivision. Hatch drew up two proposed written contracts, but Walton and Duhn would not sign either one. Nevertheless, construction began. A dispute over what Walton and Duhn owed Hatch led Hatch to terminate his involvement in the project before the house was finished. Walton and Duhn sued Hatch for breach of contract, among other claims. The district court entered judgment in favor of Walton and Duhn and awarded damages. The Supreme Court reversed in part and affirmed in part, holding that the district court (1) erred in calculating the damages that Walton and Duhn suffered as a result of Hatch’s improper billing practices; (2) erred in finding liability and awarding damages for breach of an implied warranty that the home would be built in a skillful and workmanlike manner; and (3) did not abuse its discretion in denying Walton’s and Duhn’s application for attorney fees. View "Walton v. Hatch" on Justia Law

In 2011, Catlin (Syndicate 2003) at Lloyd’s (“Catlin”) issued to San Juan Towing and Marine Services (SJT), a ship repair company based on San Jan, Puerto Rico, a marine insurance policy to cover SJT’s floating drydock. After the drydock was damaged and sold for scrap, the SJT filed a claim with Catlin, alleging the total loss of the drydock in the amount of $1,750,000. Catlin denied this claim. Catlin then filed a declaratory judgment complaint against SJT, alleging eight admiralty or maritime claims and seeking to void the policy. SJT filed a separate diversity suit against Catlin seeking recovery for the full insured value under the policy for the loss of the drydock. At trial, the district court concluded that the insurance policy was void ab initio pursuant to the doctrine of uberrimae fidei. The First Circuit affirmed as modified, holding (1) the contract was voidable, not void ab initio; and (2) SJT violated the doctrine of uberrimae fidei in its procurement of the policy, and thus, Catlin was entitled to void the policy. View "Catlin (Syndicate 2003) at Lloyd’s v. San Juan Towing & Marine Servs., Inc." on Justia Law

This issue this case presented for the Supreme Court's review centered on the parties' respective rights and obligations arising from a contract for the sale of land from SKI, Ltd.'s predecessor-in-interest to Mountainside Properties, Inc. The contract included a "right of first offer" (ROFO) with respect to an adjacent parcel. Mountainside appealed a declaratory judgment where the trial court concluded that the terms of the ROFO provision constituted an unlawful restraint on alienation. SKI cross-appealed the trial court's judgment that an offer that it made in 2012 to Mountainside pursuant to the ROFO violated the covenant of good faith and fair dealing implied in the agreement, and that it therefore was not free to sell the property to another buyer on the terms offered to Mountainside upon Mountainside's rejection of the offer. Both parties argued that the trial court erred in proposing an offer by SKI to Mountainside on alternative terms which the court concluded would satisfy the requirements of the ROFO while avoiding an unlawful restraint on alienation. After review, the Supreme Court affirmed the trial court's judgment that SKI's offer did not satisfy the requirements of the ROFO such that Mountainside's rejection freed SKI to sell the property to someone else. Because the Court reached its conclusion on the basis of straightforward contract interpretation, it did not consider whether the 2012 offer ran afoul of the implied covenant of good faith and fair dealing. Furthermore, the Supreme Court concluded the ROFO did not constitute an improper restraint on alienation. View "Ski, Ltd. v. Mountainside Properties, Inc." on Justia Law

Plaintiff Birchwood Land Company appealed a Superior Court decision denying Birchwood's motion for attachment and granting defendant Judith Krizan's motion to dismiss for failure to state a claim. Birchwood's complaint alleged that Krizan was unjustly enriched by Birchwood's construction of an access road and other infrastructure to her property such that she was able to develop the property without contributing to the cost of the improvements. Upon review, the Supreme Court agreed that the complaint failed to state a claim upon which relief can be granted and affirmed. View "Birchwood Land Company, Inc. v. Krizan" on Justia Law