Justia Contracts Opinion Summaries

Case voluntarily enrolled in a three-year, employer-sponsored educational program, agreeing, in writing that if he quit his job within 30 months of completing the program, he would reimburse his employer, UPI, a prorated portion of program costs. Two months after completing the program, Case went to work for another employer. He refused to reimburse UPI, which sued for breach of contract and unjust enrichment. Case cross-complained, asserting the reimbursement agreement was unenforceable and UPI violated the Labor Code and other statutory provisions in seeking reimbursement. The trial court granted UPI summary judgment on both its complaint and Case’s cross-complaint, and subsequently granted UPI’s motion for attorney fees for defeating Case’s wage claims. The court applied the version of Labor Code section 218.5 in effect at the time of the summary judgment proceedings, rather than the version in effect at the time it awarded fees, which permits fees to a prevailing employer only when the employee’s wage claims have been brought in “bad faith.” The court of appeal affirmed summary judgment, but reversed the attorney fees award. Under California Supreme Court precedent, statutory provisions that alter the recovery of attorney fees are deemed procedural in nature and apply to pending litigation. View "USS-POSCO Indus. v. Case" on Justia Law

This case was Appellants' fifth unsuccessful attempt to recoup damages arising out of FedEx's termination of their linehaul contracts. They appealed a superior court judgment granting judgment on the pleadings and awarding sanctions under Code of Civil Procedure section 128.72 against them and their attorney. After review, the Court of Appeal affirmed and granted defendant-respondent Mirza Ahmad's motion for additional section 128.7 sanctions on appeal against Appellants and their trial counsel. View "Bucur v. Ahmad" on Justia Law

Lewis sued the video-sharing service, YouTube, for breach of contract it deleted her "channel." YouTube filed a filed a request for judicial notice of the YouTube Community Guidelines and several e-mails between Lewis and YouTube.The trial court granted the request for judicial notice and entered a judgment of dismissal. The court of appeal affirmed, stating that no provision in the Terms of Service could serve as the basis for the relief that Lewis sought. The court noted that YouTube has restored service for Lewis. View "Lewis v. YouTube" on Justia Law

In this suit alleging breach of an insurance contract, plaintiff appealed the trial court's grant of defendant's motion for directed verdict. Plaintiff contended that the trial court’s intended jury instruction violated the efficient proximate cause doctrine and there was sufficient evidence to permit the jury to determine whether plaintiff met his burden of proving his claim for punitive damages. The court concluded that plaintiff’s interpretation of the Other Coverage 9 provision is the correct interpretation, consistent with the efficient proximate cause doctrine. A policy cannot extend coverage for a specified peril, then exclude coverage for a loss caused by a combination of the covered peril and an excluded peril, without regard to whether the covered peril was the predominant or efficient proximate cause of the loss. Because the trial court granted the motion for a directed verdict based on the effect the erroneous proposed jury instruction would have had on plaintiff’s case, the court reversed and remanded as to this issue. Because defendant's special instruction No. 12 improperly shifted the burden of proof, the trial court erred in its decision to instruct the jury with defendant’s proposed special instruction and in granting defendant’s motion for directed verdict based on the decision to give that instruction. The court reversed and remanded as to this issue. Finally, the court found no error in the trial court's punitive damages claim. View "Vardanyan v. Amco Ins. Co." on Justia Law

The Army Corps of Engineers retained JMR as general contractor for construction of a dental clinic at the Presidio of Monterey. JMR entered into separate electrical and plumbing subcontracts with EAR. SureTec issued separate bonds guaranteeing EAR’s performance. While the project was ongoing, JMR communicated with EAR about alleged delays, deficient and late submittals, and improper work, and retained certain funds otherwise due EAR. After the project was completed, JMR sued EAR and SureTec for breach of contract and for foreclosure of the bonds. EAR filed a cross-complaint to recover retention funds withheld under the subcontracts. JMR was awarded $315,631, which included an offset for retention funds. The court held that JMR was entitled to attorney fees for its successful defense of the cross-complaint; awarded JMR $90,644.07 in expert witness fees, concluding that JMR’s recovery exceeded its $375,000 pretrial settlement offers. The court of appeal affirmed the judgment but reversed the award of expert fees. The court upheld utilization of the Eichleay method to calculate extended home office overhead damages; use of the modified total cost method of calculating JMR’s disruption and delay damages; and finding SureTec liable under the bonds because formal notice of default was not a condition precedent to recovery. View "JMR Constr. Corp. v. Envtl Assessment & Remediation Mgmt., Inc." on Justia Law

This case arose out of a payment dispute between Coast, a contractor, and United, Coast's subcontractor. On appeal, United challenged the trial court's finding in favor of Coast, arguing that the trial court erred in finding that Coast was not liable for extra payments, as well as for failing to assess penalties and attorney’s fees against Coast for its delay in forwarding the retention payments. The court held that, pursuant to Civil Code section 8814, subdivision (c), a contractor is entitled to withhold a retention payment only when there is a good faith dispute regarding whether the subcontractor is entitled to the full amount of the retention payment. Accordingly, the court reversed the judgment of the trial court as to this issue. On remand, the trial court is directed, pursuant to section 8818, to award United penalties. Consequently, the court reversed the award of attorney fees as to the retention payments and remanded the issue. The court need not reach the merits of the breach of contract claims because United has failed to show that the trial court erred in its determination that United failed to prove damages. Accordingly, the court affirmed in part, reversed in part, and remanded. View "United Riggers & Erectors v. Coast Iron & Steel" 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

The California Department of Transportation (CalTrans) and Papich Construction Company, Inc. appealed a trial court’s issuance of a writ of mandate to vacate the award of a public works contract to Papich. DeSilva Gates Construction submitted the second-lowest bid (the first bidder was disqualified for a non-responsive bid), and included the names and description of work by all subcontractors slated to perform work exceeding one-half of one percent of the bid amount. DeSilva later sent a letter to CalTrans noting DeSilva had inadvertently supplied CalTrans with additional information on the subcontractor list "above and beyond what was required." DeSilva explained it had not listed "All Steel Fence" as a subcontractor in its bid because the value of the bid items it would perform was less than one-half of one percent of the bid and the information for All Steel Fence (submitted within 24 hours of the bid) was additional information that was not required. Papich challenged DeSilva’s bid as having changed the subcontractor list. CalTrans rejected DeSilva’s bid as nonresponsive. DeSilva protested CalTrans’s determination that its bid was nonresponsive and protested Papich’s bid. The trial court granted the writ on grounds CalTrans erroneously rejected DeSilva's bid, and erred by awarding the contract to Papich despite Papich’s failure to comply with a material requirement of the information for bids. On appeal, CalTrans and Papich argued DeSilva’s bid was nonresponsive. Appellants also argued CalTrans had discretion to waive Papich’s mistake in failing to acknowledge the addendum to the information for bids. After review, the Court of Appeal concluded the trial court did not err. DeSilva’s disclosure of a subcontractor performing work amounting to only one-tenth of one percent of the total value of the contract was not required by the Public Contract Code or CalTrans’s information for bids. The additional information was accurate, albeit unnecessary, and did not render DeSilva’s bid nonresponsive. By contrast, CalTrans initially declared Papich’s bid to be nonresponsive and then waived Papich’s mistake and determined the bid to be responsive. The Court concluded CalTrans abused its discretion by awarding Papich the contract. Accordingly, the Court affirmed the trial court’s issuance of the writ of mandate. View "DeSilva Gates Construction, LP v. Dept. of Transportation" on Justia Law

Defendant-appellant Northrop Grumman Systems Corporation appealed a judgment of approximately $1.1 million plus interest, costs, and attorney fees of approximately $1.8 million in favor of plaintiff-respondent Hot Rods, LLC. This case involved an environmentally compromised property Hot Rods purchased from Northrop and the alleged damages stemming from environmental cleanup and related issues. The matter was tried by a referee pursuant to stipulation, and judgment was entered by the trial court, adopting the referee’s recommendations. Northrop alleged numerous errors. Upon review, the Court of Appeal found that there was language in the referee’s statement of decision indicating Northrop had negligently misrepresented certain facts, but did not find any damages were proximately caused, nor did the referee award any damages on that cause of action. The Court concluded the referee erred in admitting certain evidence, and that a finding of negligent misrepresentation was therefore improper, and not sufficiently supported by substantial evidence. The Court reversed the bulk of the damages award, and remanded for a reconsideration of which party was the prevailing party, and therefore entitled to attorney fees. View "Hot Rods v. Northrop Grumman Systems Corp." 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