Justia Contracts Opinion Summaries

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Appellant Baptist Health (Baptist) appealed the circuit courtâs order that granted Appellee Andre Hutsonâs class-certification motion. In her underlying claim, Appellee argued that Baptist breached a contractual obligation by assessing medical services at higher rates than its âregularâ rates. Appellee concluded that a class action suit was the only feasible method to address the allegation for over a thousand patients like her. Baptist argued that the circuit court abused its discretion by stretching the rules in order to certify the class action suit. The trial court agreed with Appellee, and certified the case as a class action. Upon review, the Supreme Court found that the trial court did not abuse its discretion and affirmed the lower courtâs decision.

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Appellant Kim Crockett appealed the circuit courtâs order in favor of Appellee C.A.G. Investments, Inc. (CAG). CAG was created as an investment vehicle to provide funds to Omni Holding and Development Corporation (Omni). Omni operated a crop-dusting and farm-equipment export business. CAG purchased equipment and land for Omniâs operations and a house for Omniâs manager. Ms. Crockett became Omniâs sole stockholder, president and chairman of the board in 2005. CAG made a series of loans to Omni. The loans were secured by the property Omni used in the businessâ operation, and by the house in which Ms. Crockett lived. In late summer 2003, Omni suffered numerous financial difficulties, resulting in the deterioration of the business relationship between the management of CAG and Omni. While Omni contemplated filing for bankruptcy protection, CAG sought to recover the collateral pledged for the loans it had made to Omni. CAG asked Omni to remove all personal property Omni owned from the premises, and demanded to take possession of the real property. Omni refused to comply, and CAG sued for possession, believing the property to be unlawfully detained. The circuit court entered an order against Omni for unlawful detainer, and found that CAG was entitled to a writ of possession. Omni did not vacate the premises, and appealed the circuit courtâs order. The appellate court dismissed Omniâs appeal. Upon review, the Supreme Court affirmed the decisions of the circuit and appellate courts.

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Appellants appealed an order revoking their pro hac vice admissions in connection with a putative class action suit where the suit alleged that appellants' clients breached supplemental cancer insurance policies that they had issued. At issue was whether the district court erred in revoking appellants' pro hac vice status where the revocation was based on motions appellants filed in response to plaintiffs' request for class certification, chiefly a motion to recuse the district judge based on his comments during an earlier hearing. The court vacated the revocation order and held that, even though the recusal motion had little merit, the district court erred in revoking appellants' pro hac vice admissions where it did not afford them even rudimentary process.

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Wanting to retire from the trucking business, the owner entered into employment contracts so that the plaintiffs would act as CEO and vice president and a stock purchase agreement. The relationship broke down while they were negotiating a buy-sell agreement. The owner fired the plaintiffs and paid benefits specified in the employment contract. The plaintiffs did not purchase stock or place $750,000 into an escrow, as they were entitled to do to secure their position. The district court ruled in favor of the owner. The Seventh Circuit affirmed, holding that neither party violated a clause in the stock purchase contract that required that they use "best efforts" to enter into a buy-sell agreement. The plaintiffs retained the right to purchase stock, but chose not to do so, which entitled the owner to terminate their employment. The owner took full advantage of his rights under the contracts, but did not exploit the plaintiffs.

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Defendant-Appellant Randall Peterson appealed the district court order that denied his motion for reconsideration of a judgment entered against him for credit card debt owed to Plaintiff-Appellee Citibank (South Dakota), N.A. (Citibank). Citibank sued Defendant alleging he failed to pay his bill. Defendant filed what he called a âspecial appearanceâ only to ask that the complaint be dismissed. The district court denied Defendantâs motion to dismiss. Subsequently Defendant filed a letter he had sent to the lawyer disciplinary board to the district court. The district court eventually entered a default judgment in favor of Citibank, and ordered Defendant to pay his bill. On appeal, Defendant argued that the two documents (the âspecial appearanceâ and the letter to the disciplinary board) were âbrush offsâ by the court, and constituted an abuse of discretion by the court in entering the default against him. The Supreme Court noted many of the technical problems with Defendantâs submissions to the lower court. Even in his application for appeal, Defendant addressed no errors at the lower court, and raised no real issues for the Courtâs review. Subsequently, the Supreme Court affirmed the decision of the lower court.

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Defendant Bruce Harris appealed a judgment that awarded Plaintiff Linda Smestad over $30,000 for loans she claimed she made to Harris during an eighteen-month business and personal relationship. Harris operated a subchapter-S corporation in which he was the sole shareholder. Smestad had lived with Harris, and wrote a series of checks to Harris, his company, and to others on behalf of Harris and his company. When the relationship ended, Smestad filed suit against Harris to be reimbursed for the checks she wrote on his behalf. Harris represented himself on appeal, and listed 35 one-sentence âissuesâ that were not developed into comprehensible legal arguments. The Supreme Court acknowledged that Mr. Harris did not articulate himself to allow the district court to lend credence to his claims. On review of the record, the Supreme Court reversed only one part of the district courtâs decision relating to Harrisâ âissues.â The Court found that the $30,000 was an oral agreement, and that amount was unenforceable under the statute of frauds. The Court affirmed the lower courtâs judgment in part, reversed in part, and remanded the case for further proceedings.

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QT Trading, L.P. ("QT") sued defendants for rust damage to its steel pipes that allegedly occurred during their transport from Dalian, China to Houston, Texas. At issue was whether the district court properly granted summary judgment to in personam defendants on QT's claims for damages under the Carriage of Goods at Sea Act ("COGSA"), 46 U.S.C. 30701 note (Carriage of Goods by Sea), and for negligent bailment of its goods. The court affirmed summary judgment and held that the district court properly dismissed QT's COGSA claims where QT failed to establish genuine issues of material fact where none of the defendants were "carriers" and thus could not be liable for damages under the statute. The court also held that the district court properly dismissed QT's bailment claims where QT failed to show that a certain defendant had exclusive possession of the cargo.

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Grubbs Infinity ("Grubbs"), the insured, sued Universal Underwriters of Texas Insurance Company ("Universal") for underpayment of its insurance policy claim after Grubbs suffered hail damage to buildings on its property. At issue was whether the party demanding appraisal had waived its right to insist on the contractual procedure when the parties disagreed, but neither sought appraisal until one had filed suit. The court conditionally granted Universal's petition for writ of mandamus and directed the trial court to grant Universal's motion to compel appraisal where Universal had not waived its appraisal right and where Grubbs failed to demonstrate a showing of prejudice.

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Owatonna Clinic-Mayo Health System ("Clinic") sued its insurer, Medical Protective Company ("Medical Protective"), claiming that the company had breached its obligation to defend and indemnify the Clinic in a medical malpractice suit that had resulted in a judgment against it. At issue was whether the district court erred in ruling as a matter of law that the Clinic's notice to Medical Protective, of a potential claim against it, conformed to the insurance policy requirements and whether the Clinic's belief that it was at risk was objectively reasonable. Also at issue was whether the Clinic was entitled to pre-judgment interest. The court affirmed the judgment and held that the Clinic was deemed to have filed a timely notice with Medical Protective where the information that Medical Protective received would obviously alert a reasonable insurer to the likelihood of possible allegations of liability on the Clinic's part. The court also held that Medical Protective's challenge to the district court's finding, that the Clinic's belief that it was at risk was objectively reasonable, was meritless where the quoted policy language set an exceedingly low bar. The court further held that the district court did not err in awarding pre-judgment interest under Minn. Stat. 60A.0811, subd. 2(a) where the statute was unambiguous; and, in the alternative, if the statute was ambiguous, the court construed it against the insurer.

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Plaintiff Great Wolf Lodge of Traverse City, LLC (Lodge) is a water park that sits on former farmland. In 2000, the Lodge annexed a new portion of the former farmland to expand its premises. Defendant Cherryland Electric Cooperative (Cherryland) ran an electric line to the former farm. Cherryland insisted that it had exclusive rights to provide electric service to the Lodge. The Lodge did not protest Cherrylandâs assertion in order to keep its expansion project on track. The new Cherryland contract called for discounted rates. Over the course of the contract, Cherryland unilaterally raised the rates. The Lodge filed suit seeking a refund of excess rates it paid to Cherryland, and to have the ability to choose its own electric service provider. A hearing officer would rule in favor of the Lodge on the rate refund, but would not allow it to choose its own service provider, citing Cherrylandâs âright of first entitlementâ that dated back to when it provided service to the farm. The appellate court reversed the hearing officer. One of the issues on appeal to the Supreme Court was whether Cherrylandâs âright of first entitlementâ stopped when the property ownership changed hands. The Court concluded that the right is not extinguished when ownership changes. The Court reversed the judgment of the appellate court, and reinstated the decision of the hearing officer.