Justia Contracts Opinion Summaries

Brian Herman and Skyler Herman sued Peter Tonn Enterprises, LLC, doing business as I39 Supply, for breach of contract. The Hermans alleged that they agreed to buy a livestock trailer from I39 Supply, but I39 Supply failed to honor the agreement. The Hermans served I39 Supply via certified mail, but I39 Supply did not respond, leading the Hermans to file for a default judgment. The district court granted the default judgment, ruling that I39 Supply was properly served and had failed to answer the complaint.I39 Supply, represented by its owner Peter Tonn, who is not an attorney, sent documents to the district court and participated in the default judgment hearing by telephone. The district court ruled that Tonn could not represent the LLC and entered a $19,000 judgment in favor of the Hermans. I39 Supply later retained counsel and filed a motion to vacate the default judgment, arguing that Tonn was unaware he could not represent the LLC. The motion did not mention personal jurisdiction. The district court granted the motion to vacate the default judgment and set the matter for a pretrial conference.The Nebraska Supreme Court reviewed the case and found that I39 Supply made a general appearance by filing the motion to vacate the default judgment without raising the issue of personal jurisdiction. This action conferred personal jurisdiction on the district court. The Supreme Court reversed the district court's order dismissing the Hermans' complaint for lack of personal jurisdiction and remanded the case for further proceedings. View "Herman v. Peter Tonn Enters." on Justia Law

The Comedy Store, a stand-up comedy venue in Los Angeles, was forced to close for over a year due to COVID-19 restrictions. In July 2021, the Store hired Moss Adams LLP, an accounting firm, to help apply for a Shuttered Venue Operator Grant from the U.S. Small Business Administration. The parties signed an agreement that included a Washington choice of law provision and a forum selection clause mandating disputes be resolved in Washington state courts, along with a predispute jury trial waiver. The Store alleged Moss Adams failed to inform it of the grant program's impending expiration, causing it to miss the application deadline and lose an $8.5 million grant.The Store initially filed a complaint in the United States District Court in Los Angeles, but the case was dismissed for lack of subject matter jurisdiction. The Store then refiled in the Los Angeles Superior Court, asserting claims including gross negligence and breach of fiduciary duty. Moss Adams moved to dismiss or stay the action based on the forum selection clause. The trial court granted the motion, contingent on Moss Adams stipulating that the Store could exercise its right to a jury trial in Washington. Moss Adams provided such a stipulation, and the trial court signed an order affirming the Store's right to a jury trial in Washington.The California Court of Appeal, Second Appellate District, Division Four, reviewed the case. The court found that the trial court erred by not properly applying the reversed burden of proof, which required Moss Adams to show that litigating in Washington would not diminish the Store's unwaivable right to a jury trial. The appellate court concluded that Moss Adams did not meet this burden, as Washington courts have enforced predispute jury waivers, and the stipulation offered by Moss Adams was not a binding modification of the agreement. The appellate court reversed the trial court's decision and remanded with instructions to deny Moss Adams's motion to dismiss or stay the action. View "The Comedy Store v. Moss Adams LLP" on Justia Law

LCPFV, LLC owned a warehouse with a faulty sewer pipe. After experiencing toilet backups, LCPFV hired Rapid Plumbing to fix the issue for $47,883.40. Rapid's work was unsatisfactory, leading LCPFV to hire another plumber for $44,077 to correct the problem. LCPFV sued Rapid Plumbing, which initially appeared in court but later defaulted. LCPFV sought a default judgment of $1,081,263.80, including attorney fees and punitive damages. The trial court awarded a default judgment of $120,319.22, significantly less than LCPFV's demand, and also awarded $11,852.90 in sanctions.The Superior Court of Los Angeles County, presided over by Judge Mark V. Mooney, reviewed the case. The court scrutinized LCPFV's default judgment package and found the requested amount excessive. The court emphasized its role as a gatekeeper in default judgment cases, ensuring that only appropriate claims are granted. The court rejected LCPFV's use of requests for admissions obtained after Rapid Plumbing had ceased participating in the case, citing a lack of candor and evidentiary value.The California Court of Appeal, Second Appellate District, Division Eight, reviewed the case. The court affirmed the lower court's judgment, agreeing that the trial court acted within its discretion in rejecting the inflated default judgment request. The appellate court upheld the trial court's decision to award $120,319.22, including $91,960.40 for breach of contract and $4,948.46 in attorney fees, rejecting the fraud and punitive damages claims. The court also affirmed the sanctions award and the decision to grant prejudgment interest from the date of the lawsuit filing, not from the date of payment to Rapid Plumbing. The appellate court found no abuse of discretion in the trial court's rulings and emphasized the importance of judicial vigilance in default judgment cases. View "LCPFV v. Somatdary" on Justia Law

Bruce Johnson and Caroline Settino were engaged to be married, with Johnson giving Settino a $70,000 diamond engagement ring and two wedding bands. Johnson also paid for various expenses, including part of Settino's dental implant surgery. However, Johnson ended the engagement after discovering messages on Settino's phone that led him to believe she was unfaithful, although the trial judge found no evidence of an affair. Settino kept the engagement ring and wedding bands, and Johnson did not pay for the second part of Settino's dental procedure.Johnson sued to recover the engagement ring and wedding bands, and Settino counterclaimed for the cost of the dental procedure. The Superior Court judge ruled in favor of Settino, allowing her to keep the engagement ring and one wedding band, and awarded her damages for the dental procedure, including prejudgment interest from the date of Johnson's complaint. The judge found Johnson at fault for ending the engagement based on his mistaken belief of infidelity.The Appeals Court reversed the decision, ruling that Johnson was not at fault and should recover the engagement ring and wedding band. The court also found that prejudgment interest should be calculated from the date of Settino's counterclaim, not Johnson's complaint. The Supreme Judicial Court of Massachusetts granted further appellate review.The Supreme Judicial Court of Massachusetts held that the concept of fault should not determine the return of engagement rings. The court adopted a no-fault approach, requiring the return of the engagement ring and wedding bands to the donor if the marriage does not occur, regardless of fault. The court also affirmed the need to recalculate prejudgment interest from the date of Settino's counterclaim. The judgment was reversed in part and remanded for recalculation of prejudgment interest. View "Johnson v. Settino" on Justia Law

A construction company chartered a barge and obtained insurance through a broker. Upon returning the barge, the owner discovered damage and sued the construction company in federal court. The construction company requested its insurer to defend it, but the insurer refused, citing lack of coverage. After the federal court awarded damages to the barge owner, the construction company sued the insurer and broker in state court, alleging breach of contract, insurance bad faith, and negligence.The Superior Court of Alaska denied the construction company's motion for summary judgment against the broker and insurer. The court granted summary judgment to the broker and insurer, finding that the construction company's claims were barred by the statute of limitations. The court held an evidentiary hearing and concluded that the construction company had not relied on any reassurances from the broker that would have delayed the filing of the lawsuit.The Alaska Supreme Court reviewed the case and affirmed the Superior Court's decision. The court held that the construction company's claims against the broker were time-barred, as the statute of limitations began to run when the insurer first denied coverage. The court also held that the construction company's claims against the insurer were time-barred, as the statute of limitations began to run when the insurer refused to defend the construction company in the federal lawsuit. The court concluded that the construction company's claims were untimely and affirmed the summary judgment in favor of the broker and insurer. View "Swalling Construction Company, Inc. v. Alaska USA Insurance Brokers, LLC" on Justia Law

Major Brands, Inc., a Missouri-licensed liquor distributor, had been the exclusive distributor of Jägermeister in Missouri since the 1970s. In 2018, Mast-Jägermeister US, Inc. (MJUS) terminated this relationship and appointed Southern Glazers Wine and Spirits, LLC (Southern Glazers) as the new distributor. Major Brands sued MJUS and Southern Glazers, alleging wrongful termination under Missouri franchise law, conspiracy to violate Missouri franchise law, and tortious interference with the franchise relationship.The case was initially brought in state court but was removed to the United States District Court for the Eastern District of Missouri. After dismissing additional defendants, the case proceeded to a jury trial. The jury awarded Major Brands $11.75 million, finding in its favor on five counts, including violation of Missouri franchise law and tortious interference. The district court denied the defendants' motions for judgment as a matter of law or a new trial and awarded attorney’s fees to Major Brands.The United States Court of Appeals for the Eighth Circuit reviewed the case. The court found that the district court had prejudicially erred in instructing the jury on the essential element of a "community of interest" under Missouri franchise law. The appellate court held that the jury instructions failed to require consideration of whether Major Brands made substantial investments that were not recoverable upon termination, which is necessary to establish a community of interest. Consequently, the Eighth Circuit reversed the district court’s decision, vacated the jury’s verdict and the award of attorney’s fees, and remanded the case for a new trial. View "Major Brands, Inc. v. Mast-Jagermeister US, Inc." on Justia Law

In this case, Four Thirteen, LLC filed a complaint against three corporate entities and several individuals, including Joshua Wearmouth, Larry Stephens, Edmond X. Moriniere, Ronald G. Meyers, and David C. Norton. The complaint alleged that Wearmouth and Stephens solicited funds from Four Thirteen for a business venture involving Brazilian carbon credits, which turned out to be fraudulent. Four Thirteen claimed that the corporate entities did not own the carbon credits and that Wearmouth and Stephens made numerous misrepresentations. The complaint included claims of breach of contract, fraud, negligent misrepresentation, and other related allegations.The District Court of Laramie County reviewed the case and rejected the affidavits of non-involvement filed by Moriniere, Meyers, and Norton, who sought dismissal from the suit. The court found that there were factual issues regarding their involvement in the alleged fraud. Additionally, the district court imposed discovery sanctions and entered a default judgment against all defendants, including the individual appellants, for failing to comply with discovery orders.The Wyoming Supreme Court reviewed the case and affirmed the district court's decision regarding the affidavits of non-involvement. The Supreme Court determined that the district court correctly found that there were factual disputes about the involvement of Moriniere, Meyers, and Norton, which precluded their dismissal from the case.However, the Supreme Court reversed the district court's decision to impose discovery sanctions against the individual appellants. The Supreme Court found that the appellants were not given proper notice that they were subject to sanctions under Wyoming Rule of Civil Procedure 37(b) and that there was no evidence they violated any prior discovery order. The court held that the sanctions against the individual appellants were not justified and remanded the case for further proceedings consistent with its opinion. View "Stephensv. Four Thirteen, LLC" on Justia Law

CorpCar Services Houston, Ltd. (CorpCar) entered into a franchise license agreement with Carey Licensing, Inc., and Carey International, Inc. (collectively Carey) to operate a chauffeur-driven service under the Carey brand in Houston, Texas. In 2015, CorpCar was found liable for punitive damages for creating a racially hostile work environment, which led Carey to terminate the franchise agreement in 2016. CorpCar argued that the termination was wrongful because it did not materially breach the agreement and, even if it had, Carey did not provide an opportunity to cure the violation as required by the agreement.The Superior Court of the District of Columbia granted summary judgment to Carey, finding that CorpCar’s breach was incurable as a matter of law and that CorpCar had an opportunity to cure but failed to do so. The court also denied CorpCar’s cross-motion for summary judgment, concluding that issues of material fact remained for the jury to decide.The District of Columbia Court of Appeals reviewed the case and agreed with the lower court that CorpCar’s breach was material. However, the appellate court disagreed with the finding that the breach was incurable as a matter of law. The court held that the language of the franchise agreement was clear and precluded the application of the incurable breach doctrine. The court also found that there was a dispute of material fact as to whether Carey repudiated the franchise agreement, effectively denying CorpCar an opportunity to cure.The appellate court reversed the grant of summary judgment to Carey and remanded the case for further proceedings. The court instructed that a jury must decide whether Carey repudiated the agreement, whether CorpCar had cured or could have cured its breach, and whether affording an opportunity to cure would have been futile. The denial of CorpCar’s cross-motion for summary judgment was affirmed. View "CorpCar Services Houston, LTD v. Carey Licensing, Inc." on Justia Law

Casey and Janae Ruppert entered into a contract to purchase ranch property from Judith Merrill. Before closing, Merrill indicated she would not proceed with the sale. The Rupperts filed a complaint seeking specific performance and damages. The district court found Merrill breached the contract and denied her affirmative defenses. It awarded the Rupperts damages and attorneys’ fees but declined to order specific performance. The Rupperts appealed the denial of specific performance, and Merrill cross-appealed the attorneys’ fees award.The District Court of Laramie County found Merrill breached the contract but declined to order specific performance, citing Merrill’s personal circumstances and misunderstandings about the contract. It awarded the Rupperts $22,342 in damages and granted their motion for attorneys’ fees without explanation, awarding $55,258.50 in fees and $3,082.60 in costs.The Wyoming Supreme Court reviewed the case and found the district court abused its discretion by denying specific performance. The court noted the district court’s findings contradicted its decision, as it found the contract valid, the price reasonable, and no undue influence or unconscionability. The Supreme Court held that specific performance was the appropriate remedy given the circumstances and the equities involved.Regarding attorneys’ fees, the Supreme Court agreed with both parties that the district court erred by awarding fees without explanation. The Supreme Court independently assessed the reasonableness of the fees, concluding that the rates charged were excessive for the local market. It reduced the hourly rate to $250, resulting in a total fee award of $28,425.00, plus the previously awarded costs of $3,082.60.The Wyoming Supreme Court reversed the district court’s orders denying specific performance and awarding attorneys’ fees, remanding the case for entry of an order consistent with its opinion. View "Merrill v. Ruppert" on Justia Law

Fitzgerald Fruit Farms, LLC leased land from Whitaker Farms, LLC for a peach orchard. After being locked out of the leased premises, Fitzgerald Farms sued Whitaker Farms for damages. A jury awarded compensatory damages to Fitzgerald Farms. The Court of Appeals affirmed in part but reversed the trial court’s ruling that Fitzgerald Farms could not seek punitive damages. On remand, a second jury awarded punitive damages to Fitzgerald Farms. The Court of Appeals affirmed, holding that statements made during a settlement negotiation by Whitaker Farms’s Chief Operating Officer to Fitzgerald Farms’s owner were properly admitted under OCGA § 24-4-408.The trial court initially ruled that Fitzgerald Farms could not seek punitive damages, but the Court of Appeals reversed this decision. On remand, the trial court conducted a second jury trial focused on punitive damages, where the jury awarded $500,000 in punitive damages to Fitzgerald Farms. Whitaker Farms appealed again, arguing that the trial court abused its discretion by admitting statements made during a settlement negotiation. The Court of Appeals affirmed the trial court’s decision, stating that the statements were admissible to show Whitaker’s intent and state of mind.The Supreme Court of Georgia reviewed the case and vacated the Court of Appeals’s judgment. The Supreme Court determined that the statements made during the settlement negotiation were inadmissible under OCGA § 24-4-408. The Court concluded that the statements were offered to prove Whitaker Farms’s liability for punitive damages, which is not permissible under the statute. The case was remanded to the Court of Appeals to determine whether the admission of the statements was harmful and if a new trial on punitive damages is required. View "Whitaker Farms, LLC v. Fitzgerald Fruit Farms, LLC" on Justia Law