Justia Contracts Opinion Summaries

Plaintiff CB Richard Ellis, Inc. (CBRE), pursuant to a 2004 listing agreement, sought a commission after the 2005 sale of 38 acres of land in Murrieta. Arbitration proceedings between CBRE and the seller, Jefferson 38, LLC resulted in a confirmed arbitral award in CBRE’s favor, but no monetary satisfaction for CBRE because Jefferson had no assets by the time of the arbitral award and judgment. The issue this case presented to the Court of Appeal centered on CBRE’s attempt to recover damages from Jefferson’s individual members. A jury trial resulted in a $354,000 judgment in favor of CBRE. Both defendants and CBRE appealed the judgment, citing alleged errors pertaining to jury instructions, the admissibility of evidence, juror misconduct, attorney fees, and prejudgment interest. Upon review, the Court of Appeal rejected the parties’ contentions, except with regard to CBRE’s entitlement to attorney fees.View "CB Richard Ellis v. Terra Nostra Consultants" on Justia Law

Alasko Foods, Inc. (“Alasko”), a Canadian corporation that sells frozen produce to retail outlets, and Foodmark, Inc. (“Foodmark”), a Massachusetts corporation that assists food manufacturers in marketing branded-label and private-label products to retailers, entered into a “U.S. Representation Agreement [and] Sales Management Agreement” wherein Alasko retained Foodmark to market Alasko’s products in the United States. Five years later, Alasko terminated the Agreement. Foodmark filed a complaint against Alasko, alleging that Alasko’s refusal to pay the “Non-Renewal Termination Fee” contemplated by the Agreement constituted a breach of the Agreement and of its covenant of good faith and fair dealing. A federal district court entered summary judgment for Foodmark and awarded $1.1 million in damages. The First Circuit affirmed, holding that there were no genuine issues of fact, and Foodmark was entitled to a termination fee in the amount calculated by the district court.View "Foodmark, Inc. v. Alasko Foods, Inc." on Justia Law

A stock transfer agent gave a stockholder an allegedly incomplete and misleading answer to a question about its requirements for removing a restrictive legend on the stockholder’s stock. The stockholder sued the transfer agent, asserting claims for violation of Nev. Rev. Stat. 104.8401 and 104.8407, negligent and fraudulent misrepresentation, aiding and abetting a breach of fiduciary duty, and conspiracy. Under sections 104.8401 and 104.8407, a transfer agent must, on proper request, register a transfer of securities without unreasonable delay. The district court granted the transfer agent’s motion for summary judgment. The Supreme Court affirmed, holding (1) sections 104.8401 and 104.8407 did not support liability in this case because the stockholder did not ask the transfer agent to remove the legend and reissue him clean shares, and because the stockholder never submitted a transfer request, the agent’s statutory duty to register a requested transfer did not arise; and (2) the stockholder’s common law claims failed on the grounds that they were not supported by competent evidence.View "Guilfoyle v. Olde Monmouth Stock Transfer" on Justia Law

In 2009, Kristine Failla, a Washington resident and experienced salesperson, was looking for a job she could perform from her Gig Harbor home. She e-mailed Kenneth Schutz looking for such a position. Schutz was the founder and chief executive officer (CEO) of FixtureOne Corporation, which sells fixtures, casework, and displays for use in retail stores. Both FixtureOne and Schutz are based in Pennsylvania, and at the time of Failla's email, FixtureOne had no physical presence or customers in Washington. FixtureOne hired Failla as an account executive. In December 2010, Failla requested a promotion and a raise. Schutz agreed and promoted her to FixtureOne's vice president of sales, increased her yearly salary. Although there were outstanding commissions owed, Failla accepted the promotion and salary increase based on the assurances that the commissions would be paid. Schutz provided a draft employment agreement for Failla to sign in connection with the promotion. Among other things, the agreement contained a provision that it would be interpreted in accordance with Pennsylvania law. Failla proposed revisions to the agreement, but for reasons unknown neither Failla nor Schutz ever signed it. Failla continued working for FixtureOne from her Washington home until May 2011. She received regular paychecks, and the only issue in this case was the sales commissions owed to her that were not paid. In May 2011, Schutz emailed Failla to tell her that FixtureOne was "clos[ing] its doors" and ended her employment the following day. He assured Failla that FixtureOne would "pay your commissions and expenses asap in the next several weeks." For two months following her termination, Schutz returned Failla's requests for payment with various explanations as to why the commissions remained unpaid. Schutz eventually advised Failla that she would not receive a commission check and for the first time disputed whether such commissions were even owed. Failla filed suit against FixtureOne and Schutz for the wilfull withholding of wages, including an allegation that Schutz was individually liable under Washington's wage laws. Failla served Schutz in Pennsylvania but was unable to serve FixtureOne. Consequently the suit proceeded against Schutz alone. Failla and Schutz cross moved for summary judgment. Schutz argued that the trial court lacked personal jurisdiction because he did not have the requisite minimum contacts with the state, and even if Washington could exercise jurisdiction over him, there were genuine issues of material fact preventing the entry of summary judgment. The trial court concluded it had personal jurisdiction and denied Schutz's summary judgment motion. The court granted summary judgment to Failla, awarding double damages. The Court of Appeals reversed, holding that Washington's long-arm statute did not reach Schutz because the employment relationship between Failla and FixtureOne was inadequate to confer jurisdiction over Schutz. The Washington Supreme Court disagreed with the appellate court, and reversed. View "Failla v. FixtureOne Corp." on Justia Law

This case stemmed from a family dispute. Eugene Barriffe, and his wife, Ernie, gave money to Ernie’s brother, Lawson Nelson, to start a landfill business in Jackson County. The Barriffes testified that Lawson approached them for an initial “investment” of $100,000—and later, a second “investment” of $65,000—into his idea to start a landfill business. In return, the Barriffes understood they were to receive two-thirds of the profits from the landfill business, with payments to begin when Eugene retired. Nelson denied the conversation and denied receiving the “investments” from the Barriffes. The Barriffes sued to receive compensation for the money they gave to Nelson to start the business business, and for improvements they made to an apartment on his land. The chancellor found that Nelson held the money and improvements in a constructive trust. But because the Barriffes failed to establish the existence of a constructive trust, the Supreme Court reversed in part and remanded for further proceedings. View "Barriffe v. Estate of Nelson" on Justia Law

Gerdau leased a locomotive from Titan for use in switching at its Knoxville mill. Titan shipped the locomotive in 2008, but it was damaged in transit and sent for repair. It did not reach Gerdau’s plant until 2009. Gerdau rejected it, stating that it needed further repairs. While the locomotive was being repaired, Titan assigned the lease to Leasing, an affiliated business, which then used the lease as security for a loan from Wells Fargo. The loan is nonrecourse: Wells Fargo agreed to look for repayment exclusively from the stream of rentals expected from Gerdau. Leasing made several warranties. Gerdau has never made a payment on the lease. Wells Fargo has taken control of the locomotive and is attempting to sell it. The district court granted summary judgment against Wells Fargo, ruling that Leasing had kept its promises. The court looked to the lease, and then to the Uniform Commercial Code, to see whether the locomotive had been “accepted” when the lease was assigned. Gerdau had an opportunity and the lease required Gerdau to inspect before shipment. The Seventh Circuit reversed. Gerdau did not acknowledge the locomotive’s receipt; Leasing did not live up to its warranties. It must repay Wells Fargo. Titan must perform the guarantees.View "Wells Fargo Equip. Fin., Inc. v. Titan Leasing Inc." on Justia Law

Following a two-day trial in May 2013, a Bullock County jury returned a $450,000 verdict in favor of Michael Shepherd on a breach-of-warranty claim he asserted against Barko Hydraulics, LLC. Shepherd purchased a Barko 495ML knuckle boom loader ("the 495ML loader") from G&S Equipment Company in 2008 for use in his logging operation. In November 2010, when the 495ML loader had approximately 4,300 hours on its clock, Shepherd transported it to G&S Equipment for repairs after the hydraulic pumps began making noise. G&S Equipment confirmed that the hydraulic pumps had failed and notified Shepherd that the needed repairs, costing approximately $10,000, would not be covered under the warranty because the warranty period had expired. At Shepherd's request, G&S Equipment contacted Barko, which confirmed that it would not authorize or reimburse G&S Equipment for making the needed repair because of the expiration of the warranty. At that point, Shepherd told G&S Equipment that he could not afford to pay for the repairs to the 495ML loader, nor could he continue to meet his obligation to Wells Fargo (the bank that lent him the purchase money for the loader). He left the loader with G&S Equipment, notified Wells Fargo of its location, and of his intention to make no further payments on it. Wells Fargo subsequently repossessed the loader, sold it, and obtained a $124,184 deficit judgment against Shepherd. Shepherd then sued Barko, G&S Equipment, and Cummins Mid-South, LLC, the manufacturer of certain component parts of the 495ML loader, asserting fraud, negligence and/or wantonness, and multiple breach-of-warranty claims. Shepherd sought both compensatory damages for lost profits and mental anguish and punitive damages. Ultimately, G&S Equipment and Cummins Mid-South were dismissed from the action, and, during the course of the trial, all of Shepherd's claims against Barko except a breach-of-express-warranty claim were withdrawn or dismissed. Barko's subsequent postjudgment motion renewing its previous motion for a judgment as a matter of law or, in the alternative, for a new trial was denied by the trial court. Barko then appealed to the Supreme Court. After review, the Court concluded the trial court erred in not granting Barko's postjudgment motions. The case was remanded for entry of an order granting Barko's motion for a new trial. View "Barko Hydraulics, LLC v. Shepherd " on Justia Law

The Practice-Monroeville, P.C., is a medical-practice group located in Monroeville. Allscripts Healthcare, LLC, based in North Carolina with no Alabama offices, sells health-care software to health-care providers. Jackson Key Practice Solutions, LLC is a certified "sales-and-service partner" of Allscripts, selling and servicing Allscripts software, and Anderton is an employee and partial owner of Jackson Key. In May 2011, the Practice and Allscripts entered into a written contract in which the Practice purchased health-care software called "MyWay" from Allscripts through Jackson Key. The contract contained an arbitration provision, which stated in pertinent part: "Any dispute or claim arising out of, or in connection with, this Agreement shall be finally settled by binding arbitration in Raleigh, NC, in accordance with the then-current rules and procedures of the American Arbitration Association ...." The Practice became dissatisfied with the performance of the MyWay software and unsuccessfully attempted to cancel its contract with Allscripts. The Practice sued Jackson Key and Anderton, but not Allscripts, in circuit court. Jackson Key and Anderton moved to compel arbitration based on the arbitration provision in the contract. Anderton and Jackson Key appealed the Circuit Court's order denying their motion to compel arbitration. After review, the Supreme Court found the circuit court erred in its decision, reversed and remanded the case for further proceedings. View "Anderton v. The Practice-Monroeville, P.C. " on Justia Law

Tommy Sundy petitioned for a writ of mandamus to direct the circuit court to dismiss third-party claims asserted against him by accounting firm Frost Cummings Tidwell Group, LLC ("FCT"). Adams Produce Company, Inc. ("APCI"), purchased Crestview Produce of Destin, Inc., from Sundy. As part of the transaction, APCI and Sundy executed a promissory note in the amount of $850,000, and Sundy became an employee of APCI. FCT alleges that, based on representations from APCI and Sundy, certain budget and bonus projections were set for APCI, but those goals were not met. Because of that failure, Sundy was not entitled to bonuses that had been paid to him throughout 2009. With the alleged help and direction of FCT, APCI recharacterized the bonuses as repayments of principal on the promissory note. The nonpayment of certain amounts to Sundy in the context of this action effectively increased APCI's income and decreased its indebtedness. APCI also allegedly entered into an oral, undocumented agreement with Sundy stipulating that it would make him whole in future years for the forfeited bonus payments. In 2009, APCI's shareholders decided to sell the company to API Holdings, LLC. API Holdings alleges that it discovered that, contrary to representations made by FCT in an audit report, APCI's financial statements were fraudulent, causing API Holdings to believe that APC was worth more than it actually was. API Holdings sued FCT asserting claims of negligent misrepresentation, auditing malpractice, fraud, and other claims of professional malfeasance. Among several other claims, API Holdings alleged that FCT had failed to uncover misrepresentations by Sundy and APCI and that FCT had acted fraudulently in confirming the recharacterization of Sundy's bonuses as payments on principal of the promissory note. A few months later, APC filed for Chapter 11 bankruptcy protection. APC filed an adversarial complaint in FCT's bankruptcy case, alleging that FCT's audit work had painted a false financial picture of APC upon which APC had relied in continuing to operate its business even after reaching the point of insolvency. FCT filed a third-party complaint with the bankruptcy court against Sundy and others. FCT's complaint alleged various theories under Alabama law as bases for FCT to "recover over" against Sundy. Sundy subsequently moved to dismiss FCT's third-party complaint on the basis of 6-5-440, Ala. Code 1975, Alabama's abatement statute. The circuit court denied the motion, and Sundy then filed his petition for a writ of mandamus seeking to have the Supreme Court direct the circuit court to vacate its judgment denying his motion to dismiss and to order the circuit court to dismiss FCT's claims against Sundy asserted in its third-party complaint at circuit court. The Supreme Court concluded that FCT's third-party claims against Sundy were not barred by the abatement statute. The circuit court properly declined to dismiss those claims. Therefore, the Court denied the petition for a writ of mandamus. View "In re: API Holdings, LLC v. Frost Cummings Tidwell Group, LLC" on Justia Law

Seaport Village Operating Company, LLC (the “Company”) sought to recover from Seaport Village Ltd. (“Limited”) attorneys’ fees and expenses that the Company incurred in two lawsuits against Limited. The Company’s limited liability company agreement included a fee-shifting provision providing that the prevailing party in disputes arising out of the Agreement is entitled to recover reasonable attorneys’ fees in connection with the prosecution or defense of the action. Limited argued that because the Company did not sign the agreement, it was not a party to the agreement. The Court of Chancery awarded the Company fees and expenses, holding that, under Delaware law, the Company, although not a signatory, was a party to the operating agreement and could therefore enforce the fee-shifting provision against Limited.View "Seaport Village Ltd. v. Seaport Village Operating Co., LLC" on Justia Law