Justia Contracts Opinion Summaries

Plaintiff Atronix, Inc. filed suit against defendant Kenneth Morris for, among other things, breach of contract, and sued defendant Scott Electronics, Inc. for tortious interference with contractual relations. Atronix appealed a superior court’s order dismissing its action for lack of standing. Morris started working at Atronix Sales, Inc. (Old Atronix) in 1982. He was promoted several times over the course of his employment, eventually becoming program manager in the sales department. That position entailed responsibility for the largest and most important of Old Atronix’s accounts. Accordingly, in 1997, Morris was required to sign a non-compete and non-solicitation agreement (the non-compete agreement), and a non-disclosure agreement. In 2011, Old Atronix merged with Atronix, Inc. (the Company). In 2016, Morris left his job with plaintiff and was hired as a general manager by Scott, one of the Company’s competitors. The New Hampshire Supreme Court concluded the terms of Morris’ non-compete agreement was conveyed to the Company according to the terms of its asset purchase agreement, it was still pertinent to the success of the merger. The Company, therefore, had standing to enforce it against Morris. View "Atronix, Inc. v. Morris" on Justia Law

The underlying dispute in this case involved a commercial transaction between H2O Environmental, Inc. (H2O) and Farm Supply Distributors, Inc. (Farm Supply). Following a bench trial, H2O was awarded $7,354.64 for Farm Supply’s breach of an express oral contract. The magistrate court subsequently awarded attorney’s fees to H2O pursuant to Idaho Code section 12-120(3), but limited its award to the amount in controversy. H2O appealed to the district court, claiming that the magistrate court abused its discretion. The district court affirmed and awarded attorney’s fees to Farm Supply. H2O timely appealed. The Idaho Supreme Court determined the district court erred when it affirmed the magistrate court’s award of attorney fees: nothing in the record explained the relationship between the magistrate court’s evaluation of the Idaho Rule of Civil Procedure 54(e)(3) factors and its decision regarding the amount to award for attorney’s fees. “It is not enough for a trial court to acknowledge the existence of the Rule 54(e)(3) factors; rather, it must appear that there is a reasoned application of those factors in the trial court’s decision regarding the amount of attorney’s fees to be awarded.” The Supreme Court reversed and remanded for further proceedings. View "H20 Environmental v. Farm Supply" on Justia Law

In 2013, while the disputed insurance policy was in effect, several guests at the Siloam Springs Hotel allegedly sustained injuries due to carbon monoxide poisoning stemming from an indoor-swimming-pool heater that had recently been serviced. The hotel sought coverage under the policy, and the insurer denied coverage based on the exclusion for “qualities or characteristics of indoor air.” This case made it back to the Tenth Circuit following a remand in which the district court was directed to determine whether there was complete diversity of citizenship between the parties, which was an essential jurisdictional issue that needed to be decided before it could properly address the merits of this case. On remand, the district court received evidence on this question and determined that diversity jurisdiction was indeed proper. The district court also certified a policy question to the Oklahoma Supreme Court, which held that the exclusion at issue in this case - however interpreted -should not be voided based on public policy concerns. Following the Oklahoma Supreme Court’s resolution of the certified question, the insurer asked the district court to administratively close the case, arguing that “no further activity in this case . . . remains necessary to render the [district c]ourt’s adjudication of the coverage issue which the case concerns a final judgment.” The hotel asked the court to reopen the case to either reconsider its previous order or to enter a final, appealable judgment against the hotel. The district court held that the case had already been administratively closed and it had no need to reopen the case, since “both its finding of diversity jurisdiction and the Oklahoma Supreme Court’s answer to the certified question did not alter in any way” the court’s summary judgment decision on the merits of the coverage dispute. The hotel appealed. The Tenth Circuit determined the hotel was entitled to coverage under the policy at issue, and reversed the district court's denial. The case was remanded for further proceedings on the question of damages. View "Siloam Springs Hotel v. Century Surety Company" on Justia Law

The Seventh Circuit affirmed defendant's motion to dismiss an action alleging that defendant tortiously interfered with plaintiff's employment contract and knowingly misrepresented company policy, both of which resulted in plaintiff's termination. The court held that the corporate officer privilege was inapplicable here; plaintiff failed to allege facts sufficient to establish the element of intentional inducement; the district court accurately held that plaintiff failed to state a claim for tortious interference with contract; plaintiff failed to allege a common law fraud claim; plaintiff was not entitled to leave to amend at this stage; and plaintiff's counsel's actions did not warrant sanctions under Judicial Code 1927. View "Webb v. Frawley" on Justia Law

Connecticut imposed liability for breaches of contract when attended by deception. Unhappy with flanges purchased under a contract with PM Engineered Solutions, Inc. (“Powdered Metal”), Bosal Industries-Georgia, Inc. (“Bosal”) decided to switch suppliers and terminate the contract. After a five-day bench trial, the district court found that the termination was not only wrongful in breach of the contract, but that it was deceptive in violation of the Connecticut Unfair Trade Practices Act. Because Connecticut law applied and the district court’s findings rested on a permissible view of the evidence, the Sixth Circuit affirmed except as to the calculation of postjudgment interest on damages. View "Premium Freight Mgmt. v. PM Engineered Solutions" on Justia Law

The plaintiffs were two wholly owned subsidiaries of First American Financial Corporation: First American Title Insurance Company (FA Company) and First American Title Company, LLC (FA LLC) (collectively Plaintiffs). The defendants, who appealed a judgment against them (Defendants) were Michael Smith, Kristi Carrell, and Northwest Title Insurance Agency, LLC. Jeffrey Williams was also a defendant, but is not a party to the appeal. Defendants raised numerous grounds on appeal of a large jury award based on breaches of contractual and fiduciary duties, many of which the Tenth Circuit concluded were not adequately preserved or presented. Therefore, the Tenth Circuit affirmed the district court's judgment, "[w]e may not have awarded the same amount, but we see no abuse of discretion." View "First American Title Insurance v. Northwest Title Insurance" on Justia Law

Borsheim Builders Supply, Inc., doing business as Borsheim Crane Service, ("Borsheim") appealed a declaratory judgment granting summary judgment to Mid-Continent Casualty Company and dismissing Borsheim's claims for coverage. After review of the facts presented, the North Dakota Supreme Court concluded the district court erred in concluding Construction Services, Inc. ("CSI"), and Whiting Oil and Gas Corporation were not insureds entitled to defense and indemnity under the "additional insured" endorsement in the commercial general liability ("CGL") policy Mid-Continent issued to Borsheim. Furthermore, the Court concluded the court erred in holding Mid-Continent had no duty to defend or indemnify Borsheim, CSI, and Whiting under the CGL policy for the underlying bodily injury lawsuit. View "Borsheim Builders Supply, Inc. v. Manger Insurance, Inc." on Justia Law

Aqua Marine Enterprises, Inc. ("AME"), and AME's chief operating officer and vice president Brent Mitchell appealed a circuit court judgment in favor of K&B Fabricators, Inc. ("K&B"), following a bench trial in a dispute alleging the usurpation of corporate opportunities in the business of fabricating storm shelters. In 2006, Mitchell began discussions with Kendall Blaxton, who owned a welding-supply company used by AME, about starting a storm-shelter-fabrication business in Alabama because Mitchell believed it would be more efficient to deal with a local shelter fabricator. Those discussions led to the formation of K&B, a closely held corporation with three shareholders, Mitchell and two brothers, Kendall and Kenneth Blaxton. From 2006 to mid 2014, all of AME's steel storm-shelter orders were fabricated by K&B. AME entered into a non-compete/non-disclosure agreement with K&B. Kendall testified that in 2009 he and his brother had a dispute about how K&B was being managed, and Kendall ended up buying out Kenneth's ownership interest in K&B. Kendall then owned 90 percent of K&B's stock and Mitchell owned 10 percent. In early 2012, Kenneth formed Compliance Construction with two others; the company was to "take advantage of business opportunties that did not involve storm-shelter fabrication." By 2014, the relationship between AME and K&B had soured, and ended with AME accusing K&B of violating the noncompetition agreement between them. AME contended the trial court erred in concluding K&B did not violate the agreement. The Alabama Supreme Court found that AME failed to demonstrate Compliance's involvement in storm-shelter fabrication constituted a violation by K&B of the noncompetition agreement. The Court affirmed a finding of liability against Mitchell and its imposition of a constructive trust upon AME; the Court also affirmed the ruling in favor of K&B on AME's allegation of breach of the noncompetition agreement. The Court reversed, however, part of the trial court's judgment awarding damages, finding the award was not based upon the profits earned by AME in its fabrication. View "Aqua Marine Enterprises, Inc. v. K&B Fabricators, Inc." on Justia Law

Brian Pipkin appealed a circuit court's grant of summary judgment in favor of Sun State Oil, Inc. on Pipkin's claim of conversion, negligence, and/or wantonness, and trespass with regard to Sun State's removal of gasoline pumps from Pipkin's property. IMAS Partnership, LLC ("IMAS"), purchased from William Rivers and Sybil Rivers a parcel of real property located at 15065 Highway 43 North, Bucks, Alabama ("the property"), on which was situated a convenience store and gasoline station. IMAS intended to operate the business as "Bucks Country Store." In anticipation of its acquisition of the property, IMAS entered into a "Petroleum Supply Agreement" with Sun State to procure a supply of gasoline to sell to customers of the store ("the PSA"). The PSA provided that Sun State would lease two gasoline pumps to IMAS for 10 years in exchange for IMAS purchasing a minimum of 6 million gallons of petroleum from Sun State over the 10-year term. At some point in 2012, Sun State stopped doing business with IMAS because it had heard the store was not making money would would go into foreclosure. Sun State did not reclaim the gas pumps immediately, to allow, as it described at trial, the owner to get a new tenant, yet retain the store as a customer. The Riverses executed a vendor's lien deed conveying the property to Pipkin; Pipkin testified that William Rivers made it clear when they negotiated the sale of the property that the gas pumps were included in the purchase price. By the summer of 2014, Sun State became concerned about vandalism at Pipkin's property and decided to retrieve the pumps, offering to reinstall them once Pipkin had a tenant to operate the store. Sun State declined to return the pumps, however. Pipkin subsequently filed suit against Sun State for the pumps. The Alabama Supreme Court found no evidence that Sun State filed an UCC-1 financing statement before Pipkin purchased the property. Sun State's unperfected security interest in the gasoline pumps did not have priority over Pipkin's ownership interest in the property. Accordingly, Pipkin acquired the pumps free and clear of Sun State's interest, and Sun State did not possess an ownership interest in the pumps when it removed them from Pipkin's property. Accordingly, the Alabama Supreme Court reversed summary judgment in favor of Sun State, and remanded this case for further proceedings. View "Brian Pipkin v. Sun State Oil, Inc., et al." on Justia Law

In this complaint alleging fraud, negligent misrepresentation, and breach of fiduciary duty against Van Wagoner & Bradshaw, LLC, an accounting firm, and Coldwell Banker Commercial, the Supreme Court largely affirmed as to the issues raised in cross-petitions for certiorari but reversed and remanded as to the issue as to whether Plaintiff was entitled to a jury instruction on nondisclosure fraud.Reperex, Inc. brought this action after a business it purchased in a deal brokered by Coldwell failed. All of the claims against Coldwell were dismissed before trial. Two of the claims against Bradshaw were dismissed before trial, and the remaining fraud claim went to trial, where Bradshaw prevailed. The court of appeals affirmed as to Bradshaw but reversed as to Coldwell. Coldwell and Reperex filed cross-petitions for certiorari. The Supreme Court held (1) Coldwell could not be held liable despite a nonreliance clause in Coldwell’s contract with Reperex; (2) expert testimony was not required to sustain Reperex’s breach of fiduciary duty claim; (3) Reperex failed to establish a basis for overcoming protections available to Bradshaw under Utah Coe 58-26a-602; but (4) as to the lack of a jury instruction on nondisclosure fraud, the case must be remanded for a determination of whether Bradshaw owed Reperex a duty of disclosure under the common law. View "Reperex, Inc. v. Coldwell Banker Commercial" on Justia Law