Justia Contracts Opinion Summaries

Bank foreclosed its loan on residential real estate and resold the property to Buyers. The purchase agreement for the transaction contained an arbitration clause. After Buyers learned that another bank had a superior lien against the real estate they sued Bank for damages. Bank filed a motion to compel arbitration pursuant to the purchase agreement. The district court sustained the motion. The Supreme Court affirmed, holding (1) the purchase agreement was governed by the Federal Arbitration Act, and Buyers’ claims were subject to the arbitration clause; and (2) there was no merit to Buyers’ other arguments. View "Wilczewski v. Charter West National Bank" on Justia Law

Following court-ordered mediation, spouses Gary Rolison and Martha Rolison and Caleb Fryar and his father, Robert Fryar, entered into a mediation settlement agreement that resolved four lawsuits pending between the Rolisons and the Fryars. After a bench trial, the Circuit Court found that the Rolisons had breached the settlement agreement, and the court entered a final judgment pursuant to Mississippi Rule of Civil Procedure 54(b) and postponed hearing the issue of damages. The Rolisons appealed the final judgment but later dismissed the appeal voluntarily. After the trial on damages, the trial court awarded the Fryars $399,733.02 in damages, including lost profits and attorney fees. The Rolisons appealed, arguing that their jury trial waiver was ineffective, the trial court’s Rule 54(b) certification was erroneous, and the trial court erroneously denied a motion to intervene filed by two interested parties. Because the Rolisons dismissed their appeal from the Rule 54(b) final judgment, those issues were not at issue before the Supreme Court. After further review, the Supreme Court held that the trial court committed no error by finding that the Rolisons had waived their right to a jury trial on damages and attorney fees. Further, the Court rejected the Rolisons’ challenges to the trial court’s awards of damages and attorney fees because those awards were supported by substantial, credible evidence. Therefore, the Court affirmed the trial court. View "Rolison v. Fryar" on Justia Law

Defendants-Appellants Ultegra Financial, its CEO Muhammad Howard, (collectively Ultegra Defendants) and Clive Funding, Inc., appealed a district court’s order denying their motion to compel arbitration. In 2013, Ragab entered into business relationship with the Ultegra Defendants. The parties had six agreements. The agreements contained conflicting arbitration provisions; the conflicts involved: (1) which rules would govern, (2) how the arbitrator would be selected, (3) the notice required to arbitrate, and (4) who would be entitled to attorneys’ fees and on what showing. In 2015, Ragab sued the Ultegra Defendants for misrepresentation and for violating several consumer credit repair statutes. The district court found that Ragab’s claims fell within the scope of all six agreements. The Ultegra Defendants moved to compel arbitration. The district court denied the motion to compel, concluding that there was no actual agreement to arbitrate as there was no meeting of the minds as to how claims that implicated the numerous agreements would be arbitrated. The Ultegra Defendants appealed that finding, and seeing no reversible error in the judgment, the Tenth Circuit affirmed. View "Ragab v. Howard" on Justia Law

Bugs “R” Us, LLC (BRU) appealed the denial of its motion to compel arbitration in an action filed by Autumn McCants for negligent and/or wanton termite inspection of a house she purchased. After review, the Supreme Court concluded that BRU met its burden of establishing the existence of an arbitration contract between the parties. Furthermore, the arbitration provision dictated that the issues McCants raised about the applicability of the Federal Arbitration Act to this dispute, whether her claims were subsumed under the arbitration provision, and whether she was bound by the arbitration provision had to be submitted to an arbitrator for determination. Therefore, the trial court's order denying RU's motion to compel arbitration was reversed and the matter remanded for further proceedings. View "Bugs "R" Us, LLC v. McCants" on Justia Law

Plaintiffs, on behalf of themselves and others similarly situated, were former students in the nursing program at Salem International University (Salem). When Plaintiffs enrolled, they signed enrollment agreements that contained an arbitration clause. Plaintiffs filed a putative class action complaint against Salem and its president (collectively, Salem) alleging that they were denied the opportunity to complete their coursework in nursing at Salem as a result of the nursing program’s loss of accreditation. Salem filed a motion to stay proceedings pending mandatory alternative dispute resolution. The circuit court denied the motion, concluding that the arbitration agreement did not include an enforceable class action litigation waiver. The Supreme Court reversed, holding that the arbitration agreement acted as a class action litigation waiver barring Plaintiffs from seeking judicial relief as a class. View "Salem International University v. Bates" on Justia Law

This litigation arose out of the construction of the home of Randie Lawson and Deanna Lawson (together, Respondents). G & G Builders, Inc. (Petitioner) filed suit asserting that it was owed $303,686 under the parties’ construction agreement. Respondents asserted a counterclaim for breach of contract. Petitioner then filed a motion to dismiss Respondents’ counterclaim and to compel arbitration. The circuit court denied the motion, concluding that the arbitration provisions in the construction agreement were not binding on Randie because they were set forth in a document that was never provided to him, nor were they binding on Deanna, who was a non-signatory to the agreement. The Supreme Court affirmed, holding that the circuit court did not err in concluding that there was no agreement between the parties to arbitrate their dispute. View "G & G Builders, Inc. v. Lawson" on Justia Law

Robert Perry was issued a Citibank MasterCard account in 1998. The terms and conditions of the Citibank Card Agreement governing Perry’s account included an arbitration agreement. In 2010, Citibank filed a debt collection action against Perry seek to recover the balance owed on Perry’s account. In 2015, Perry filed an answer to Citibank’s complaint and a class counterclaim alleging that Citibank had violated the West Virginia Consumer Credit and Protection Act. Thereafter, Citibank filed a motion asking the court to compel arbitration of the parties’ claims. The circuit court concluded that Citibank had implicitly waived its right to arbitration by filing suit in circuit court and waiting nearly five years before seeking to invoke its contractual right to arbitrate. Citibank appealed. The Supreme Court reversed, holding that Citibank did not waive its right to compel arbitration in this matter. Remanded. View "Citibank, N.A. v. Perry" on Justia Law

In 2008, the workers’ compensation insurance policy for South Jersey (SJ), a trash-removal business, neared expiration, SJ, through its insurance agent, entered into a three-year Reinsurance Participation Agreement (RPA) with Applied Underwriters. The RPA stated that any disputes would be arbitrated in Tortola or in an agreed location and indicated that it would be governed by Nebraska law. The RPA and its attachments total 10 pages. SJ claims that it believed the RPA was a workers’ compensation insurance policy; that Applied fraudulently presented it as such; that the RPA is actually a retrospective rating insurance policy under which premiums would be based on claims paid during the previous period; and that it was promised possible huge rebates. SJ acknowledged that Applied is not an insurer and cannot issue workers’ compensation insurance. Applied represented that SJ purchased a primary workers’ compensation policy from Continental, which entered into a pooling agreement with California; all are Berskshire Hathaway companies. The pooling agreement was a reinsurance treaty. According to Applied, the RPA was not insurance, but an investment instrument. For 34 months, SJ paid monthly premiums of $40,000-$50,000, expecting a rebate. Claims paid on its behalf were $355,000 over three years. After the RPA expired, Applied declared that SJ owed $300,632.94. SJ did not pay. Applied filed a demand for arbitration. SJ sought declaratory relief as to the arbitration provision and rescission of the RPA. The district court denied the motion to compel arbitration. The Third Circuit reversed. SJ’s challenges to the arbitration agreement apply to the contract as a whole, rather than to the arbitration agreement alone; the parties’ dispute is arbitrable. View "South Jersey Sanitation Co., Inc v. Applied Underwriters Captive Risk Assurance Co., Inc." on Justia Law

Kiva Lodge Condominium Owners' Association, Inc. ("Kiva Lodge") was an Alabama nonprofit corporation formed for the purpose of administering and maintaining the Kiva Dunes Clubhouse and Condominium ("Kiva Dunes") located in Gulf Shores. In 2009, Kiva Lodge contracted with Hudak & Dawson Construction Co., Inc. ("Hudak") to be the general contractor for the remediation of deficiencies in Kiva Dunes buildings that were allowing water to enter the buildings. Hudak subcontracted the stucco and/or sealant portion of the work to Don Colvin d/b/a Colvin Plastering ("Colvin"). The Hanover Insurance Company ("Hanover"), as surety for Hudak, issued to Kiva Lodge a performance bond ensuring and/or securing the full performance of Hudak's contractual obligations. In September 2012, Kiva Lodge informed Hudak and Colvin of leaks and bubbling in the stucco exterior of the buildings at Kiva Dunes caused by water intrusion. Kiva Lodge alleged that Hudak and Colvin failed to determine and/or disclose the course of the problems and the proper scope of repairs necessary. It also alleged that Hanover breached the terms of its performance bond by failing to promptly remedy the default, complete the work within the scope of the contract in accordance with the terms and conditions, or arrange for payment of an alternative contractor to complete the work. Hanover filed a motion to dismiss Kiva Lodge's claims against Hanover on the ground that, under its performance bond, its claims were time-barred, falling outside of a two-year statute of limitations. In 2015, the circuit court heard arguments concerning Kiva Lodge's motion to compel arbitration, eventually granting the stay and ordering the parties to arbitration. The court also denied Hanover's motion to dismiss. Hudak, Colvin, and Hanover timely appealed the circuit court's order. After review, the Supreme Court found no reversible error in the trial court's order and affirmed. View "Hanover Insurance Co. v. Kiva Lodge Condominium Owners' Association, Inc." on Justia Law

Eileen Dalton purchased two used cars under separate finance contracts which contained provisions that retained self-help remedies for both parties, and that allowed either party to compel arbitration of any claim or dispute arising out of the contracts that exceeded the jurisdiction of a small claims court (which in New Mexico was $10,000). One of the cars was repossessed without judicial action. Dalton sued, alleging fraud, violations of the New Mexico Uniform Commercial Code, unfair trade practices, conversion, breach of contract, breach of the covenant of good faith and fair dealing, and breach of warranty of title. Santander Consumer USA moved to compel arbitration based on the clause contained in the finance contracts. Dalton argued that the arbitration clause was substantively unconscionable on its face, and therefore unenforceable because the self-help and small claims carve-outs were unreasonably one-sided. After review of the provisions at issue here, the Supreme Court held that the arbitration provision in this case was not substantively unconscionable because: (1) lawful self-help remedies were extrajudicial remedies; and (2) the small claims carve-out was facially neutral because either party had to sue in small claims court if its claim was less than $10,000, or arbitrate if its claim exceeds $10,000, thereby neither grossly unfair nor unreasonably one-sided on its face. View "Dalton v. Santander Consumer USA, Inc." on Justia Law