Justia Contracts Opinion Summaries

Gary Birdsall was stopped in traffic on the Bay Bridge when his van was rear-ended by Barton Helfet, resulting in serious injuries to Gary and a loss of consortium claim by his wife, Pamela. The Birdsalls’ attorney sent Helfet’s insurer a settlement demand for the $100,000 policy limit, specifying acceptance required delivery of a standard bodily injury release to be executed by both Gary and Pamela, a settlement check, and proof of policy limits by a set deadline. The insurer responded before the deadline with a letter accepting the offer, a release (which mistakenly listed Pamela as a releasee rather than a releasor), the check, and proof of policy limits. A corrected release was sent after the deadline. The Birdsalls’ attorney rejected the settlement, citing the release’s error and the late correction, and returned the check.The Birdsalls filed suit in the San Francisco County Superior Court. Helfet’s answer included affirmative defenses of settlement and comparative fault for Gary’s failure to wear a seat belt. The Birdsalls moved for summary adjudication on the settlement defense, which the law and motion judge granted. At trial, the assigned judge excluded evidence and jury instructions regarding Gary’s seat belt use. The jury found Helfet negligent, awarded substantial damages to both plaintiffs, and judgment was entered. Helfet’s post-trial motions were denied, and he appealed.The California Court of Appeal, First Appellate District, Division Two, reviewed the case. It held that summary adjudication of the settlement defense was improper because there was a triable issue of material fact regarding mutual consent to the settlement. The court also found error in excluding seat belt evidence and instructions, holding that such evidence is admissible and, under the circumstances, expert testimony was not required. The judgment and amended judgment were reversed, with instructions for a new trial and denial of summary adjudication. View "Birdsall v. Helfet" on Justia Law

Adriana Ramirez and her family were involved in litigation with third parties, including Harvey Miller and Stockdale Villa Mobile Home Park, where Ramirez was a property manager. After settling employment and unlawful detainer claims, Ramirez alleged that opposing counsel, attorney Sandra McCormack and her law firm, interfered with the settlement by, among other things, disputing the mailing address for settlement checks and failing to ensure the dismissal and sealing of the unlawful detainer action as required by the settlement. Ramirez claimed these actions caused her significant damages and brought several tort and contract-related claims against McCormack and other attorneys involved.The Superior Court of Los Angeles County denied McCormack’s special motion to strike under California’s anti-SLAPP statute. The trial court relied on precedents involving non-attorney defendants and found that the alleged conduct did not constitute protected petitioning activity under the statute. The court did not address the applicability of Thayer v. Kabateck Brown Kellner LLP, which specifically addressed claims against attorneys for litigation-related conduct.The California Court of Appeal, Second Appellate District, Division Eight, reviewed the case and reversed the trial court’s order. The appellate court held that McCormack’s actions as opposing counsel—such as negotiating settlements, communicating with other attorneys, and advising clients—were protected petitioning activities under the anti-SLAPP statute. The court found that Ramirez’s claims arose from McCormack’s representation of her clients in litigation, fitting squarely within the statute’s protections as articulated in Thayer. Furthermore, Ramirez failed to present evidence of minimal merit for her claims on appeal, effectively forfeiting the issue. The appellate court remanded the case for the trial court to grant the anti-SLAPP motion and determine the fees and costs Ramirez must pay. View "Ramirez v. McCormack" on Justia Law

The dispute arose when a property owner, after selling his San Diego County home and purchasing property in Trinity County, sought to transfer the base year value of his former property to his new one. In 2009, he sued the Trinity County Board of Supervisors to compel such a transfer under California law. The parties settled in 2012, agreeing that if the County later adopted an ordinance or if a change in law required it, the owner would be entitled to retroactively transfer the base year value. In 2020, after the passage of Proposition 19, which expanded the ability to transfer base year values between counties, the owner requested the transfer from the county assessor, who denied the request.The Superior Court of Trinity County held a bench trial and found in favor of the property owner on his breach of contract claims, ordering the County to specifically perform the settlement agreement and awarding damages. The court rejected the County’s arguments that the agreement was limited to intra-county transfers and that the Board lacked authority to bind the assessor. The court also found that the new law triggered the County’s obligations under the agreement.On appeal, the California Court of Appeal, Third Appellate District, concluded that the Board of Supervisors did not have the authority to direct the county assessor in setting or transferring base year values, as this is a duty assigned by law to the assessor, an elected official independent of the Board’s control. The court held that the 2012 settlement agreement was void and unenforceable because it exceeded the Board’s legal authority. As a result, the judgment on the breach of contract claims was reversed, while the remainder of the judgment was affirmed. The County was awarded its costs on appeal. View "Sceper v. County of Trinity" on Justia Law

Paul Kim, a California resident, purchased an Airstream motorhome from a dealer in California. The warranty agreement for the motorhome included an Ohio choice of law provision and an Ohio forum selection clause. Kim sued Airstream in California, alleging violations of the Song-Beverly Consumers Warranty Act. Airstream moved to stay the lawsuit in favor of the Ohio forum, citing the forum selection clause. Kim opposed, arguing that enforcing the forum selection clause would diminish his unwaivable rights under the Song-Beverly Act.The Superior Court of Los Angeles County severed the choice of law provision as illegal under the Song-Beverly Act’s waiver prohibition but granted Airstream’s motion to stay, concluding that enforcing the forum selection clause would not diminish Kim’s unwaivable California rights. The court relied on Airstream’s stipulation to apply the Song-Beverly Act in the Ohio forum.The California Court of Appeal, Second Appellate District, reviewed the case. The court affirmed the lower court’s decision to sever the choice of law provision but reversed the decision to stay the case. The appellate court held that Airstream’s stipulation was insufficient to meet its burden of proving that enforcing the forum selection clause would not diminish Kim’s unwaivable rights. The court instructed the trial court to allow Airstream the opportunity to demonstrate that Ohio conflict of law principles would require the application of the Song-Beverly Act to Kim’s claims, thereby protecting his unwaivable rights. The case was remanded for further proceedings consistent with this opinion. View "Kim v. Airstream" on Justia Law

Michael J. Kiely, an Irish resident, and MDMK Ltd., an Irish corporation, filed a lawsuit against HYPH (USA), Inc., HYPH Corporation, XHAIL, Inc., and several individual defendants. The plaintiffs alleged that the defendants conspired to fraudulently induce Kiely to sell shares of a company he founded at a significant discount, subsequently transferring most of those shares to a new company, thereby depriving Kiely of any ownership interest in the new company.The Superior Court of Los Angeles County granted the defendants' motion to stay or dismiss the action, determining that the case should be heard in Sweden based on a mandatory forum selection clause and traditional forum non conveniens grounds. The court found that Sweden was a suitable alternative forum and that both private and public interest factors weighed in favor of Sweden as the forum. The plaintiffs appealed the decision, contesting both grounds of the ruling.The California Court of Appeal, Second Appellate District, reviewed the case and concluded that the trial court did not abuse its discretion in determining that private and public interest factors favored Sweden as the forum. The appellate court held that the trial court properly stayed the action on the alternative independent ground of traditional forum non conveniens. Additionally, the appellate court addressed the impact of the California Supreme Court's decision in EpicentRx, Inc. v. Superior Court on the plaintiffs' claim that the enforcement of the forum selection clause operated as an "implied waiver" of their jury trial right. The appellate court affirmed the trial court's order, finding that the enforcement of the forum selection clause did not violate California public policy regarding the right to a jury trial. View "Kiely v. Hyph (USA), Inc." on Justia Law

In this residential landlord-tenant dispute, the tenants, Michael Gogal and Hildy Baumgartner-Gogal, entered into a lease with landlords, Xinhui Deng and Jianhua Wu. The lease included a clause that capped recoverable litigation costs and attorney’s fees at $1,000. After successfully suing the landlords for retaliatory eviction, the tenants were awarded a monetary judgment and attorney’s fees exceeding the $1,000 cap. They then sought to recover additional litigation costs under California Code of Civil Procedure section 1032(b). The landlords argued that the lease’s $1,000 cap barred any further cost recovery.The Superior Court of San Diego County initially ruled in favor of the landlords, enforcing the $1,000 cap. However, after further arguments from the tenants, the court reversed its decision, allowing the tenants to recover nearly $14,000 in costs. The court reasoned that enforcing the cap would contravene the public policy intent of California Civil Code section 1942.5, which aims to protect tenants from abusive landlord conduct.The California Court of Appeal, Fourth Appellate District, reviewed the case. The main issue was whether parties to a contract could waive their statutory right to recover litigation costs under section 1032(b) through a pre-dispute agreement. The appellate court concluded that section 1032(b) establishes a default rule allowing prevailing parties to recover costs but does not prohibit parties from waiving this right by agreement. The court found that such waivers are consistent with Civil Code section 3513, which allows the waiver of rights intended for private benefit. The appellate court reversed the lower court’s order, directing it to strike the tenants’ memorandum of costs, thereby enforcing the $1,000 cap stipulated in the lease. View "Gogal v. Deng" on Justia Law

The City of Oakland entered into agreements with Oakland Bulk and Oversized Terminal, LLC (OBOT) to develop a bulk cargo shipping terminal at the former Oakland Army Base, including a 66-year Ground Lease. Amid public backlash over potential coal transportation, the City moved to block coal, leading to extensive litigation. The City terminated OBOT’s Ground Lease, claiming OBOT failed to meet the Initial Milestone Date for construction. OBOT and its subtenant, Oakland Global Rail Enterprise (OGRE), sued the City for breach of the Ground Lease, breach of the implied covenant of good faith and fair dealing, and sought declaratory relief, alleging the City’s actions made it impossible for OBOT to meet the milestone and triggered a force majeure provision.The Alameda County Superior Court, after a bifurcated bench trial, found the City liable for breaching the Ground Lease and the implied covenant of good faith and fair dealing. The court issued a detailed statement of decision, highlighting the City’s failure to cooperate, its obstructionist actions, and its bad faith efforts to terminate the lease. The court awarded OBOT attorney fees and costs.The City appealed to the California Court of Appeal, First Appellate District, Division Two, arguing that the trial court misinterpreted the force majeure provision, improperly applied the implied covenant of good faith and fair dealing, erroneously declined to apply claim preclusion, and improperly entered judgment for OGRE. The appellate court affirmed the trial court’s judgment and orders, concluding that the City’s arguments lacked merit. The court held that the City’s actions constituted force majeure events, excusing OBOT’s performance delays, and that the City breached the implied covenant of good faith and fair dealing by obstructing OBOT’s efforts to develop the terminal. The court also found that claim preclusion did not apply as the federal case involved different issues and contracts. View "Oakland Bulk and Oversized Terminal v. City of Oakland" on Justia Law

Coyote Aviation Corporation (Coyote) entered into a 20-year lease with the City of Redlands (City) on April 4, 2000, for property at the Redlands Municipal Airport. The lease included two 15-year options to extend. An amended lease was signed on September 5, 2000, with the same termination date of April 4, 2020. Coyote believed the lease should terminate on September 5, 2020, but no written amendment was made. In June 2020, Coyote attempted to exercise the extension option, but the City rejected it, stating the lease had already terminated. The City issued a 30-day notice to quit, and Coyote filed a lawsuit for breach of contract and other claims.The Superior Court of San Bernardino County sustained the City’s demurrer to Coyote’s first amended complaint (FAC) and entered judgment against Coyote. The court found that Coyote failed to provide timely written notice to exercise the extension option as required by the lease. The court also rejected Coyote’s claims of breach of the implied covenant of good faith and fair dealing, declaratory relief, and promissory estoppel, finding no clear promise by the City to amend the lease termination date.The City filed an unlawful detainer action when Coyote did not vacate the property. The trial court granted summary judgment in favor of the City, ordering Coyote to vacate. The court found no triable issues of fact regarding the timeliness of Coyote’s notice to exercise the extension option and rejected Coyote’s arguments of estoppel and waiver.The California Court of Appeal, Fourth Appellate District, Division Two, affirmed the trial court’s decisions. The court held that the lease’s terms were clear and unambiguous, requiring written notice to exercise the extension option. The court also found that City officials did not have the authority to amend the lease orally or accept late notice. The court upheld the trial court’s rulings on the demurrer and summary judgment, denying Coyote’s claims and requests for leave to amend. View "Coyote Aviation Corp. v. City of Redlands" on Justia Law

R & J Sheet Metal, Inc. (R&J) appealed an order directing it to pay contribution to W.E. O’Neil Construction Co. of California (WEO), Continental Casualty Company (Continental), and Western Surety Company (Western) (collectively, the WEO defendants). R&J and the WEO defendants were co-debtors on a joint and several judgment in favor of Joseph Karscig, Inc., doing business as Architectural Systems, Inc. (ASI). R&J appealed the judgment, while the WEO defendants satisfied it and sought contribution from R&J. The trial court initially took the motion off calendar due to R&J’s pending appeal. After the appeal was resolved, the WEO defendants filed a second contribution motion, including postjudgment interest, which the trial court granted, ordering R&J to pay one-half of the judgment.The Superior Court of Los Angeles County granted the WEO defendants' motion for contribution, deeming them a single entity for liability purposes and ordering R&J to pay one-half of the judgment. R&J argued the motion was untimely and that the trial court should not have allocated liability pro rata without taking evidence on the judgment debtors’ proportionate liability. R&J also contended that Western should not have been included as a single entity with WEO and Continental.The California Court of Appeal, Second Appellate District, Division One, affirmed the trial court’s order. The appellate court held that the original contribution motion was valid despite being filed during the pendency of R&J’s appeal, as taking the motion off calendar did not affect the appeal’s status quo. The court also found that the second motion was a permissible update of the original motion to include postjudgment interest. The court rejected R&J’s argument that the trial court should have determined the judgment debtors’ proportionate liability through an evidentiary hearing, holding that pro rata contribution was proper in the absence of a judgment or underlying instrument allocating liability. The court also found that R&J had forfeited its argument regarding Western’s inclusion in a single entity with WEO and Continental by failing to raise it below. View "R & J Sheet Metal v. W.E. O'Neil Construction" on Justia Law

M.G. received health care coverage through Medi-Cal and was treated by Dameron Hospital Association (Dameron) after an automobile accident. Dameron required M.G. or her representative to sign a conditions of admissions (COA) form, which included an assignment of benefits (AOB) clause. This clause assigned to Dameron the right to direct payment of uninsured and underinsured motorist (UM) benefits from M.G.'s automobile insurance policy with Progressive Casualty Insurance Company (Progressive). Dameron sought payment from Progressive for M.G.'s treatment at rates higher than Medi-Cal would pay. Progressive settled a UM claim with M.G. but did not pay Dameron, leading Dameron to sue Progressive for damages, an injunction, and declaratory relief.The Superior Court of San Joaquin County sustained a demurrer to Dameron's complaint without leave to amend, citing collateral estoppel based on a prior decision in Dameron Hospital Assn. v. AAA Northern California, Nevada & Utah Ins. Exchange (Dameron v. AAA). The court found the COA forms to be contracts of adhesion and the AOBs unenforceable, as it was not within the reasonable expectations of patients that a hospital would collect payments for emergency care directly from their UM benefits.The California Court of Appeal, Third Appellate District, affirmed the trial court's decision. The appellate court held that the COAs were contracts of adhesion and that it was not within the reasonable expectations of Medi-Cal patients that their UM benefits would be assigned to the hospital for payment of medical bills at rates higher than Medi-Cal would pay. The court concluded that the AOBs were unenforceable and did not need to address arguments regarding collateral estoppel or the Knox-Keene Health Care Service Plan Act. The court also denied Progressive's motion to strike exhibits from Dameron's reply brief. View "Dameron Hospital Assn. v. Progressive Casualty Insurance Co." on Justia Law