Justia Contracts Opinion Summaries

Jessie and Annie Bullock were residents of Courtyard Gardens, a nursing-home facility. Linda Gulley, the Bullocks’ daughter, entered admission agreements and optional arbitration agreements on behalf of each parent. After Jessie died, Malinda Arnold, as personal representative of Jessie’s estate and as attorney-in-fact of Annie, filed a complaint against Courtyard Gardens, alleging, inter alia, negligence and medical malpractice. Courtyard Gardens moved to dismiss the complaint and compel arbitration. The circuit court denied the motion to compel arbitration, concluding that the arbitration agreement was impossible to perform because it selected the National Arbitration Forum (NAF) to serve as arbitrator, and the NAF was no longer in business. The Supreme Court reversed, holding (1) the NAF term was merely an ancillary logistical concern and was severable; and (2) therefore, the circuit court erred in denying Courtyard Gardens’ motion to compel arbitration based on impossibility of performance. View "Courtyard Gardens Health & Rehab. LLC v. Arnold" on Justia Law

Plaintiff Archangel Diamond Corporation Liquidating Trust, as successor-in-interest to Archangel Diamond Corporation (collectively, “Archangel”), appealed dismissal of its civil case against defendant OAO Lukoil (“Lukoil”), in which it alleged claims under the Racketeer Influenced and Corrupt Organizations Act (“RICO”), breach of contract, and commercial tort law. The district court dismissed the case for lack of personal jurisdiction over Lukoil and under the doctrine of forum non conveniens. Archangel Diamond Corporation was a Canadian company and bankrupt. The liquidating trust was located in Colorado. In 1993, Archangel entered into an agreement with State Enterprise Arkhangelgeology (“AGE”), a Russian state corporation, regarding a potential license to explore and develop diamond mining operations in the Archangelsk region of Russia. Archangel and AGE agreed that Archangel would provide additional funds and that the license would be transferred to their joint venture company. However, the license was never transferred and remained with AGE. In 1995, AGE was privatized and became Arkhangelskgeoldobycha (“AGD”), and the license was transferred to AGD. Diamonds worth an estimated $5 billion were discovered within the license region. In 1998, Lukoil acquired a controlling stake in AGD, eventually making AGD a wholly owned subsidiary of Lukoil. Pursuant to an agreement, arbitration took place in Stockholm, Sweden, to resolve the license transfer issue. When AGD failed to honor the agreement, Archangel reactivated the Stockholm arbitration, but the arbitrators this time concluded that they lacked jurisdiction to arbitrate the dispute even as to AGD. Archangel then sued AGD and Lukoil in Colorado state court. AGD and Lukoil removed the case to Colorado federal district court. The district court remanded the case, concluding that it lacked subject-matter jurisdiction because all of the claims were state law claims. The state trial court then dismissed the case against both AGD and Lukoil based on lack of personal jurisdiction and forum non conveniens. The Colorado Supreme Court affirmed the dismissal as to AGD, reversed as to Lukoil, and remanded (leaving Lukoil as the sole defendant). On remand, the Colorado Court of Appeals reversed the trial court’s previous dismissal on forum non conveniens grounds, which it had not addressed before, and remanded to the trial court for further proceedings. The trial court granted Lukoil and AGD's motion to hold an evidentiary hearing, and the parties engaged in jurisdictional discovery. In 2008 and early 2009, the case was informally stayed while the parties discussed settlement and conducted discovery. By June 2009, Archangel had fallen into bankruptcy due to the expense of the litigation. On Lukoil’s motion and over the objection of Archangel, the district court referred the matter to the bankruptcy court, concluding that the matter was related to Archangel’s bankruptcy proceedings. Lukoil then moved the bankruptcy court to abstain from hearing the matter, and the bankruptcy court concluded that it should abstain. The bankruptcy court remanded the case to the Colorado state trial court. The state trial court again dismissed the action. While these state-court appeals were still pending, Archangel filed this case before the Tenth Circuit Court of Appeals, maintaining that Lukoil had a wide variety of jurisdictional contacts with Colorado and the United States as a whole. Finding no reversible error in the district court's ruling dismissing the case on forum non conveniens grounds, the Tenth Circuit affirmed. View "Archangel Diamond v. OAO Lukoil" on Justia Law

This case involved a home-improvement contract between Petitioner, a construction company, and Respondents, homeowners. Both parties argued that the other breached the contract. The superior court determined that the matter must be referred to arbitration under an arbitration provision in the contract. The arbitrator found in favor of Petitioner. Petitioner filed this action seeking to confirm the arbitration award and moved for summary judgment. Only after Petitioner filed its summary judgment motion did Respondents file an answer opposing confirmation of the award. The Court of Chancery granted the petition to confirm, holding that summary judgment was appropriate in this case. View "SC&A Constr., Inc. v. Potter" on Justia Law

In 2000, plaintiff accepted the Gray law firm’s offer of employment as an associate attorney, including a provision requiring both parties to submit all disputes relating to the employment relationship to binding arbitration. In 2005, Gray merged into DLA Piper. In 2006, plaintiff signed a “Confidential Resignation Agreement and General Release of Claims.” DLA agreed to continue to provide insurance and other benefits until August 2006, when his employment would officially terminate. The Termination Agreement is silent concerning dispute resolution. Plaintiff later sued, alleging: breach of the implied covenant of good faith and fair dealing; breach of contract; promissory fraud; and constructive fraud, arguing that the firm had “undervalued” his benefits by computing them based on “artificially reduced salary figures.” DLA sought to compel arbitration. Plaintiff asserted the Termination Agreement constituted a novation, extinguishing the arbitration provision, and that even if the provision had survived, claims involving the benefit plan were not subject to arbitration. The court compelled arbitration. In 2013, the arbitrator determined DLA had breached the Termination Agreement and plaintiff had suffered emotional distress, and awarded $41,000 in contract damages plus interest, $45,000 in emotional distress damages, and $7,535.67 in costs. The court of appeal affirmed confirmation of the award. View "Jenks v. DLA Piper Rudnick Gray Cary" on Justia Law

DIRECTV and its customers entered into service agreements that included a binding arbitration provision with a class-arbitration waiver. It specified that the entire arbitration provision was unenforceable if the “law of your state” made class-arbitration waivers unenforceable. The agreement also declared that the arbitration clause was governed by the Federal Arbitration Act, 9 U.S.C. 2. After California customers entered into the agreement, the Supreme Court held that California’s rule invalidating class-arbitration waivers was preempted by the Federal Act. When California customers sued, the trial court denied DIRECTV’s request to order the matter to arbitration. The California Court of Appeal affirmed, finding the entire arbitration provision unenforceable under the agreement because the parties were free to refer in the contract to California law as it would have been absent federal preemption. The U.S. Supreme Court reversed. The California court’s interpretation does not place arbitration contracts “on equal footing with all other contracts,” as required by the Act. California courts would not interpret contracts other than arbitration contracts the same way. The language the court used to frame the issue focused only on arbitration. View "DIRECTV, Inc. v. Imburgia" on Justia Law

This case arose from a construction contract dispute between homeowners Ramon Romero and Cassie Romero and contractor Noel Madamba Contracting LLC (Madamba). The case proceeded to arbitration. Arbitrator Patrick K.S.L. Yim issued a partial final arbitration award concluding that Madamba breached the construction contract and that the Romeros were entitled to compensatory damages. Following the issuance of the partial final award, the parties learned that the law firm representing the Romeros throughout the arbitration had been retained by the administrator of Yim’s personal retirement accounts. Madamba moved to vacate the arbitration award based on this previously undisclosed information. The circuit court denied the motion, determining that Yim’s failure to disclose this information did not constitute evident partiality. The Intermediate Court of Appeals affirmed. The Supreme Court vacated the judgments of the lower courts, holding that Yim’s failure to disclose his relationship with the Romeros’ counsel’s law firm constituted evident partiality requiring vacatur of the arbitration award. Remanded with instructions to vacate the arbitration award. View "Noel Madamba Contracting, LLC v. Romero" on Justia Law

Defendant Westlake Services LLC appealed a trial court order denying its motion to compel arbitration. Alfredo Ramos, and coplaintiffs (who are not parties to this appeal) sued Defendant Westlake Services LLC for causes of actions arising out of their purchase of used automobiles. Ramos alleged that negotiations for his purchase of a car were conducted primarily in Spanish. Defendant charged Ramos money for a “guaranteed auto protection” (GAP) contract to cover the vehicle he purchased. A copy of the GAP contract was not provided to him in Spanish. In exchange for the payment of a premium by the consumer and/or purchaser of the automobile, the ‘GAP’ insurance policy contract, which identifies the respective rights and liabilities of the parties to the contract, is purportedly intended to pay the difference between the actual cash value of the financed automobile and the then-current outstanding balance on the loan for the automobile should the financed automobile be destroyed or ‘totaled’ in an accident. Ramos asserted three causes of action based on Westlake’s failure to provide a translation of the GAP contract: (1) violation of the Consumers Legal Remedies Act (CLRA); (2) violation of section 1632; and (3) violation of the unfair competition law (UCL). Westlake moved to compel arbitration of Ramos’s and his coplaintiffs’ claims, relying on the arbitration provisions contained in the underlying sales contracts they each had signed. Upon review, the Court of Appeal concluded that Ramos reasonably relied on a Spanish translation of the English contract that Pena Motors (as Westlake’s agent) provided him that did not include the arbitration. The Court concluded that mutual assent to the arbitration agreement was lacking, void and that the trial court correctly denied Westlake’s motion to compel arbitration. View "Ramos v. Westlake Services" on Justia Law

The administrator of the Pearl River County Hospital entered into a contract with Wellness, Inc., for Wellness to provide furnishings, fixtures, equipment, and systems for the Hospital’s renovation. The Hospital subsequently sued Wellness (and other defendants not party to this appeal) alleging fraud, conspiracy, breach of contract, and other causes of action. Before trial commenced, Wellness moved to compel mediation and arbitration and to stay proceedings. After a hearing on the motion, the circuit court denied the motion in its entirety. Wellness appealed. Finding no reversible error, the Supreme Court affirmed. View "Wellness, Inc. v. Pearl River County Hospital" on Justia Law

This appeal involved three different leases negotiated by Defendant between plaintiff-landowners and an oil and gas company. Each of the three leases engendered a different lawsuit against Defendant. In each case, Plaintiffs claimed that the nature of the services provided by Defendant constituted the unauthorized practice of law. Defendant moved to dismiss Plaintiffs’ lawsuits and sought to compel Plaintiffs to participate in arbitration pursuant to the arbitration clause in each lease. Plaintiffs challenged the arbitration clauses as void on the grounds that the arbitration clauses were contrary to public policy because they were procured through the unauthorized practice of law. In all three suits, the circuit court concluded that a plaintiff’s claim that a defendant engaged in the unauthorized practice of law can never, as a matter of matter of state law, be referred to arbitration. The Supreme Court reversed, holding that any state-based rule that prohibits outright the arbitration of a particular type of claim is preempted by the Federal Arbitration Act. View "Geological Assessment & Leasing v. O'Hara" on Justia Law

The complex issues at issue in these three consolidated appeals revolved around four overlapping leases to extract oil and gas from land owned by Plaintiff. Each lease contained an arbitration clause. Plaintiff filed the instant case against Defendants seeking a declaration as to which lease was controlling as to which defendants and seeking damages from Defendants. The circuit court entered an order voiding two of the four leases, addressing the substantive terms of two other leases, and compelling the parties to arbitrate any remaining claims by Plaintiff. The Supreme Court affirmed in part and reversed in part, holding that the circuit court (1) properly found the arbitration clause in one lease to be unenforceable and correctly ruled that the entire lease was unenforceable; (2) erred in compelling certain defendants to participate in arbitration under the terms of a second lease but did not err when it made findings of fact and conclusions of law that addressed the substance of Plaintiff’s claims regarding that lease; (3) erred in voiding a third lease, and its included arbitration clause, in violation the doctrine of severability; and (4) erred in its substantive rulings interpreting a fourth lease, as the court should have referred questions about the lease to arbitration. View "Chesapeake Appalachia, LLC v. Hickman" on Justia Law