Justia Contracts Opinion Summaries

Williams Alaska Petroleum owned and operated a refinery, which ConocoPhillips Alaska supplied with crude oil. ConocoPhillips demanded that Williams tender a payment of $31 million as adequate assurances of Williams’s ability to perform if an ongoing administrative rate-making process resulted in a large retroactive increase in payments that Williams would owe ConocoPhillips under the Exchange Agreement. ConocoPhillips offered to credit Williams with a certain rate of interest on that principal payment against a future retroactive invoice. Williams transferred the principal of $31 million but demanded, among other terms, credit corresponding to a higher rate of interest. Williams stated that acceptance and retention of the funds would constitute acceptance of all of its terms. ConocoPhillips received and retained the funds, rejecting only one particular term in Williams’s latest offer but remaining silent as to which rate of interest would apply. Years later, after the conclusion of the regulatory process, ConocoPhillips invoiced Williams retroactively pursuant to their agreement. ConocoPhillips credited Williams for the $31 million principal already paid as well as $5 million in interest calculated using the lower of the two interest rates. Williams sued ConocoPhillips, arguing that a contract had been formed for the higher rate of interest and that it was therefore owed a credit for $10 million in interest on the $31 million principal. The superior court initially ruled for Williams, concluding that a contract for the higher rate of interest had formed under the Uniform Commercial Code when ConocoPhillips retained the $31 million while rejecting one offered term but voiced no objection to Williams’s specified interest term. On reconsideration, the superior court again ruled for Williams, this time determining that a contract for the higher rate of interest had formed based on the behavior of the parties after negotiation under the UCC, or, in the alternative, that Williams was entitled to a credit for a different, third rate of interest in quantum meruit. The superior court also ruled in favor of Williams on all issues related to attorney’s fees and court costs. ConocoPhillips and Williams both appealed. Upon review, the Supreme Court concluded that the superior court was right the first time and that the parties entered into a contract for the higher rate of interest under the UCC. View "ConocoPhillips Alaska, Inc. v. Williams Alaska Petroleum, Inc." on Justia Law

In 1997, Defendants formed a Vermont corporation called Green Mountain Park, Inc. to reconstruct, revive, and operate a defunct horseracing facility in the Town of Pownal, Vermont. Plaintiff agreed to invest $350,000 in the enterprise. Plaintiff subsequently became a member of the board of directors along with Defendants. A few years later, the project was abandoned due to issues surrounding Green Mountain’s ability to obtain a racetrack license. Defendants filed a complaint against Plaintiff in 2002, and Plaintiff counterclaimed for breach of fiduciary duty, fraud, and breach of contract. Defendants’ complaint was subsequently dismissed, and the case proceeded to trial on Plaintiff’s counterclaims. After a bench trial, the superior court entered judgment for Defendants on all counts. The Supreme Court affirmed, holding that the trial justice did not err in his factual findings and conclusions of law. View "Wilby v. Savoie" on Justia Law

Plaintiff-appellant RBC Capital Markets, LLC (RBC) appealed a Superior Court judgment dismissing its claims against the defendant-appellees U.S. Education Loan Trust IV, LLC and Education Loan Trust IV. RBC sued the Defendants in the Court of Chancery in 2011, alleging that Defendants had been paying excessive fees from the Trust. The court dismissed the Chancery action as barred by the Trust Indenture’s "no-action" clause. Then in 2012, RBC filed this case, claiming that the Defendants had unlawfully failed to pay interest owed to RBC under the Issuer notes that RBC held. The Superior Court dismissed, finding: (1) the complaint failed to state a claim upon which relief can be granted; and (2) that the earlier Court of Chancery judgment of dismissal precluded RBC’s claim as res judicata. Upon review, the Supreme Court concluded the Superior Court erred in dismissing the case. The Court held that RBC’s complaint satisfied Delaware’s "reasonable conceivability" pleading standard, that the claim was not barred by the Trust Indenture’s no-action clause, and that on the current record it could not be determined as a matter of law that RBC’s Superior Court claim was precluded as res judicata. View "RBC Capital Markets, LLC, et al. v. Education Loan Trust IV, et al." on Justia Law

Mike Richey sold his interest in Richey Oilfield Construction, Inc. to Nighthawk Oilfield Services, Ltd. Richey remained employed as president of Richey Oil and became a limited partner in Nighthawk. The primary agreements regarding the transaction were a stock purchase agreement, an agreement for the purchase of Richey Oil’s goodwill, and a promissory note. Each of the acquisition agreements contained a forum selection clause naming Tarrant County as the venue for state court actions. When the business did not go as well as the parties had hoped, Richey filed suit in Wise County, where Richey resided, against two Nighthawk executives (together, Relators) for, among other claims, breach of fiduciary duty, common law fraud, statutory fraud, and violations of the Texas Securities Act. Relators responded by unsuccessfully moving the trial court to transfer venue to Tarrant County or dismiss the suit pursuant to the mandatory venue selection clauses in the acquisition agreements. Relators subsequently sought mandamus relief. The Supreme Court conditionally granted relief, holding that the trial court abused its discretion by failing to enforce the forum selection clauses in the acquisition agreements. View "In re Fisher" on Justia Law

In 2005, Winyah Bay Holdings, LLC held an event aimed at selling marsh-front lots located in South Island Plantation, an affluent, unbuilt housing development. Winyah conducted the sale by lottery, and geared the event toward on-the-spot sales. Winyah had Wachovia Bank and two unrelated realty and marketing companies (the Realtors) set up booths to promote financing the lot sales. Respondents alleged that Winyah, the Realtors, and Wachovia further enticed potential buyers by promising that "day docks, roads, infrastructure, pool [sic], marsh walks, and other amenities would be in place within 18 months of the lottery." Respondents William and Judith Blackburn claimed these promises got them to participate in the lottery. Over six months later, Respondent William Blackburn delivered a promissory note to Wachovia in the amount of $463,967 to finance the purchase of one of the lots. The note was secured by a mortgage and unconditional personal guaranties executed by Tammy Winner, Watson Felder, and Respondents. Sometime in 2008, Respondents failed to make payments on the note. Wachovia then filed a foreclosure action. Respondents answered, asserting counterclaims against Wachovia, cross-claims against the South Island Plantation Association, Incorporated (the HOA), and a third-party complaint against the Seller and the Realtors. At issue here were the counterclaims against Wachovia, which included claims for negligent misrepresentation, promissory estoppel, breach of contract/breach of contract accompanied by a fraudulent act, breach of fiduciary duty, fraud/fraud in the inducement, breach of contract/negligence, breach of contract, civil conspiracy, illegality of contract, and violations of the South Carolina Unfair Trade Practices Act (the SCUTPA). Wachovia appealed the court of appeals' decision to reverse the circuit court's determination that Respondents' counterclaims were within the scope of a jury trial waiver in the property sales documents. The Supreme Court affirmed the portion of the appellate courts' judgment finding that the waivers were executed knowingly and voluntarily; however, the Court reversed the portion finding that the outrageous and unforeseeable torts exception to arbitration applies in the jury trial waiver context, and found instead that Respondents waived their right to a jury trial on all of their counterclaims. View "Wachovia Bank v. Blackburn" on Justia Law

When Appellant Todd Christianson was sued by a former employee for severe personal injuries suffered while working for appellant's landscaping business, appellant tendered his defense to his general liability insurer. It did not accept his tender - instead, it sent him a letter that told him he should defend himself, noting an exclusion for claims of employees. Appellant then began to incur defense expenses. No insurer on the policies obtained by appellant's insurance broker, Conrad-Houston Insurance (CHI), ever defended him in the lawsuit. Nearly four years after receiving the insurer’s letter, appellant sued CHI for malpractice. After conducting an evidentiary hearing, the superior court applied the discovery rule and dismissed the malpractice lawsuit because it was filed after the applicable three-year statute of limitations had run. The superior court ruled that because the insurer’s letter put appellant on notice he might have a claim against CHI, the statute of limitations had begun to run more than three years before appellant sued CHI. Finding no reversible error, the Supreme Court affirmed the superior court. View "Christianson v. Conrad-Houston Insurance" on Justia Law

The parties in this dispute were Koninklijke Philips N.V. (“Philips N.V.”), a Netherlands holding company, and Carlo Vichi, an Italian businessman who had a longstanding business relationship with Philips N.V. Philips N.V. was a participant in a joint venture, LG.Philips Displays Holdings B.V. (LPD), that did business with Vichi and other entities. LPD approached Vichi for a substantial loan, which Vichi agreed to make. The joint venture eventually defaulted on the loan. Vichi filed a complaint against Philips N.V., claiming that Philips N.V. committed fraud by misrepresenting the joint venture’s financial condition and prospects and by falsely promising that it would stand behind LPD to ensure it could meet its financial obligations. The Court of Chancery held that Philips N.V. was not liable to Vichi on any of the claims he presented at trial and that Philips N.V. should not be held responsible for the loss Vichi suffered on the loan he made to LPD. View "Vichi v. Koninklijke Philips Elecs., N.V." on Justia Law

Balvitsch and Weisgram sued Tollefson for breach of contract, conversion, unjust enrichment, and other claims. Balvitsch and Weisgram moved to hold Tollefson in contempt, alleging Tollefson failed to obey a February 8, 2013 court order that instructed Tollefson not to make any further attacks on the parties and other non-party individuals during the course of the litigation. Balvitsch and Weisgram alleged the court ordered Tollefson at the scheduling conference to stop all attacks against a non-party individual and to stick to the facts of the case during the litigation. They alleged Tollefson ignored the court's order by threatening to launch websites defaming Weisgram and the non-party individual. The trial court entered an order to show cause noting the time and place for the contempt hearing and ordered that Tollefson appear and show why he should not have been held in contempt. The hearing took place, and the court found Tollefson in contempt and ordered sanctions. Tollefson appealed that order and sanction, arguing he did not receive proper notice of the hearing. Upon review, the Supreme Court reversed, concluding Tollefson did not have adequate notice of the contempt proceeding. View "Balvitsch v. Dakota Burger N Fries Corp." on Justia Law

The issue before the Supreme Court in this case centered on alternative legal and equitable claims for damages and a constructive trust on real property that arose from the same breach of fiduciary duty. The primary issue on review was whether plaintiff's election of the equitable constructive trust remedy was foreclosed by a jury determination that plaintiff's damages for the breach of fiduciary duty were $1. The Court concluded that the trial court properly permitted plaintiff to elect its equitable remedy. View "Evergreen West Business Center, LLC v. Emmert" on Justia Law

HSBC Realty Credit Corporation loaned Brandywine Partners, LLC $15.9 million pursuant to a property-loan agreement for the purchase and development of industrial property in Delaware. J. Brian O’Neill, a principal of Brandywine, signed an absolute personal guaranty for the loan. O’Neill’s liability was capped at $8.1 million. After Brandywine defaulted on its repayment obligations, HSB filed suit on the guaranty agreement. O’Neill filed several defenses and counterclaims essentially asserting that HSBC must first recover any amount owed by Brandywine by proceeding against the Delaware property before turning to O’Neill’s personal guaranty. The district judge struck O’Neill’s defenses and counterclaims, granted HSBC judgment on the pleadings, and denied O’Neill’s request to replead. The First Circuit Court of Appeals affirmed, holding that the district court judge did not commit reversible error in granting HSBC judgment on the pleadings or in denying O’Neill leave to replead, as O’Neill did not provide any additional facts which, if repled, would permit him to make out a plausible claim for relief when matched up against the guaranty’s express language. View "HSBC Realty Credit Corp. v. O'Neill" on Justia Law