Justia Contracts Opinion Summaries

Daevieon Towns purchased a new Hyundai Elantra in 2016, and over the next 19 months, the car required multiple repairs for alleged electrical and engine defects. In March 2018, either Towns or his wife, Lashona Johnson, requested that Hyundai buy back the defective vehicle. Before Hyundai acted, the car was involved in a collision, declared a total loss, and Johnson’s insurance paid her $14,710.91.Towns initially sued Hyundai Motor America in the Superior Court of Los Angeles County for breach of express warranty under the Song-Beverly Consumer Warranty Act. As trial approached, Towns amended his complaint to add Johnson as a plaintiff, arguing she was the primary driver and responsible for the vehicle. The trial court allowed the amendment, finding Johnson was not a buyer but permitted her to proceed based on its interpretation of Patel v. Mercedes-Benz USA, LLC. At trial, the jury found for Towns and Johnson, awarding damages and civil penalties. However, the court reduced the damages by the insurance payout and adjusted the prejudgment interest accordingly. Both parties challenged the judgment and costs in post-trial motions.The California Court of Appeal, Second Appellate District, Division Four, reviewed the case. It held that only a buyer has standing under the Act, so Johnson could not be a plaintiff. The court also held that third-party insurance payments do not reduce statutory damages under the Act, following the Supreme Court’s reasoning in Niedermeier v. FCA US LLC. Furthermore, prejudgment interest is available under Civil Code section 3288 because Hyundai’s statutory obligations do not arise from contract. The court affirmed in part, reversed in part, and remanded for the trial court to enter a modified judgment and reconsider costs. View "Towns v. Hyundai Motor America" on Justia Law

Following Hurricane Laura, a Texas-based company, Top Notch Movers, provided moving services in Alabama and Louisiana to Shamrock Enterprises, an Alabama-based LLC. Top Notch sent a demand letter to Shamrock seeking payment for over $170,000 in unpaid invoices. Subsequently, Top Notch filed suit in Texas for nonpayment, listing Shamrock’s principal office as a Foley, Alabama address and seeking substituted service via the Texas Secretary of State under section 5.251(1)(A) of the Texas Business Organizations Code. The Secretary of State attempted to forward process to the Foley address, but the mailing was returned as undeliverable. Shamrock did not appear, and Top Notch obtained a default judgment, which was also mailed to the same address and returned.Shamrock later initiated a restricted appeal, arguing that service of process was improper. The Court of Appeals for the Thirteenth District of Texas affirmed the default judgment, finding that Shamrock was amenable to substituted service under the cited statute and that the Secretary of State’s Whitney certificate constituted irrebuttable proof of proper service.The Supreme Court of Texas reviewed the case and determined that even if Shamrock was subject to substituted service under section 5.251(1)(A), the record did not show that process was forwarded to the statutorily required address—Shamrock’s “most recent address . . . on file with the secretary of state.” The court clarified that a Whitney certificate only proves that process was sent to the address provided, not that the statutory requirements were met, and strict compliance is necessary for a valid default judgment. Therefore, the Supreme Court of Texas reversed the judgment of the Court of Appeals, vacated the default judgment, and remanded the case to the trial court for further proceedings. View "SHAMROCK ENTERPRISES, LLC v. TOP NOTCH MOVERS, LLC" on Justia Law

A dispute arose regarding the sale of property located at 301 Harris Avenue in Providence, Rhode Island. The plaintiff, 1100 North Main LLC, sought to purchase property from the Providence Firefighters Realty Corp. (the Firefighters), contingent on the Firefighters acquiring replacement property. The Firefighters entered into negotiations with the defendant, Shoreby Hill Properties, Inc., to purchase the Harris Avenue property. After several communications, the Firefighters signed a draft purchase and sales agreement for the property, but the defendant refused to execute it and reportedly accepted another offer. The plaintiff then filed a complaint seeking declaratory, equitable, or monetary relief based on the alleged contract, and recorded two notices of lis pendens against the Harris Avenue property.In the Providence County Superior Court, the defendant moved to dismiss the complaint, quash the lis pendens, and sought sanctions. The plaintiff argued that the attorneys’ communications constituted assent and that a purported assignment from the Firefighters gave the plaintiff standing. Before the Superior Court justice issued a decision, the plaintiff attempted to amend its complaint to add factual allegations and clarify standing. The trial justice dismissed the complaint and quashed the lis pendens, finding that the allegations failed to satisfy the statute of frauds and did not establish standing. The motion to amend was denied as futile, as no enforceable contract was found.On appeal, the Supreme Court of Rhode Island reviewed whether a binding contract existed under the statute of frauds and whether denial of the motion to amend was proper. The Supreme Court held that the unsigned purchase and sales agreement did not satisfy the statute of frauds and no binding contract existed. The Court affirmed the Superior Court’s dismissal of the complaint, quashing of the lis pendens, and denial of the motion to amend. View "1100 North Main LLC v. Shoreby Hill Properties, Inc." on Justia Law

The parties in this case entered into a settlement agreement in 2005 to resolve a longstanding water rights dispute between their respective parcels, providing that future disputes would be resolved by mediation and, if necessary, binding arbitration before a retired judge with water law expertise in San Diego County. The agreement included provisions for attorney fees for the prevailing party in certain circumstances. In 2016, a new dispute arose over groundwater resources and the parties proceeded to arbitration. During the arbitration, the arbitrator withdrew after Lodge filed demands for disqualification, leaving the dispute unresolved. While the Barbanell entities sought a replacement arbitrator, Lodge initiated a separate lawsuit asserting the same claims as those in arbitration. The Barbanell entities then filed a distinct action, petitioning the Superior Court of San Diego County to appoint a new arbitrator.The Superior Court of San Diego County granted the Barbanell entities’ petition to appoint a new arbitrator and entered judgment in their favor, designating them as prevailing parties entitled to seek attorney fees. Upon subsequent motion, the court found that the settlement agreement entitled the Barbanell entities to recover reasonable attorney fees incurred in obtaining the appointment of a new arbitrator, and awarded them $68,800 in fees. An amended judgment was issued to reflect this award.The Court of Appeal, Fourth Appellate District, Division One, reviewed only the postjudgment award of attorney fees. It affirmed the Superior Court’s decision, holding that the Barbanell entities were prevailing parties in the discrete action to appoint an arbitrator and were entitled to attorney fees under the settlement agreement and Civil Code section 1717. The appellate court clarified that the presence of related claims pending elsewhere did not preclude a fee award for this separate, concluded action. View "Barbanell v. Lodge" on Justia Law

John Doe was a motivational speaker who, for nearly thirty years, was featured, promoted, and endorsed by the California Association of Directors of Activities (CADA) to intermediate and high school audiences. In 2022, CADA received an email from a former church youth group member alleging that Doe, under a different name in the 1990s, had engaged in an inappropriate sexual relationship with a 17-year-old student. After an independent investigation, CADA concluded that Doe was likely the person in question and terminated its association with him. CADA notified its members of the termination without disclosing the nature of the accusation.Doe filed suit in Santa Cruz County Superior Court against both CADA and the accuser, asserting tort and contractual claims. Both defendants filed special motions to strike under California’s anti-SLAPP statute. The trial court granted the accuser’s motion, finding Doe’s claims against her were protected by the common interest privilege and lacked evidence of malice. Regarding CADA, the trial court found the claims arose from protected activity but denied CADA’s motion to strike most of Doe’s claims, concluding Doe showed a sufficient probability of prevailing, particularly on contract-based claims.On appeal, the California Court of Appeal, Sixth Appellate District, reviewed the trial court’s order denying CADA’s anti-SLAPP motion. The appellate court held that all of Doe’s tort claims and contractual claims based on CADA’s communications were subject to the common interest privilege and must be stricken, as Doe did not show CADA acted with malice. However, the court affirmed the denial of the motion as to Doe’s contractual claims based on his termination, concluding Doe demonstrated minimal merit and that public policy did not bar enforcement. The appellate court reversed in part and remanded, directing the lower court to strike the specified claims and allegations. View "Doe v. California Assn. of Directors of Activities" on Justia Law

A restaurant operated by PFPCO.’s Noble Pie Parlor leased space in the El Cortez Hotel in Reno, Nevada, which was owned by El Cortez Reno Holdings, LLC. After initially peaceful relations, the parties’ relationship deteriorated due to disputes over property maintenance and incidents such as a gas leak and a stolen camera. Tensions escalated when El Cortez locked Noble Pie out, resulting in litigation that ended largely in Noble Pie’s favor, with the judgment affirmed on appeal. Later, Noble Pie permanently closed its restaurant, prompting El Cortez to allege breach of the lease’s agreed-use provision and file a new complaint. Noble Pie moved to dismiss; the district court granted the motion but allowed El Cortez to amend its complaint. After further procedural exchanges, El Cortez filed an amended complaint, and Noble Pie again moved to dismiss.The Second Judicial District Court, Washoe County, presided by Judge Egan K. Walker, reviewed El Cortez’s late opposition to the motion to dismiss and its request for an extension of time. El Cortez’s request, based on “professional courtesy,” was submitted just before the deadline. The district court denied the extension, finding no good cause for the delay and noting El Cortez’s pattern of tardiness in filings. The court treated El Cortez’s failure to timely oppose the motion as an admission under DCR 13(3), granted the motion to dismiss with prejudice, denied leave to further amend, and awarded attorney fees to Noble Pie as the prevailing party under the lease.On appeal, the Supreme Court of Nevada considered whether the district court abused its discretion in denying the extension, granting the motion to dismiss, refusing leave to amend, and awarding attorney fees. The Supreme Court of Nevada held that the district court did not abuse its discretion or err in any of these rulings and affirmed the judgment, emphasizing the importance of adhering to procedural rules in litigation. View "El Cortez Reno Holdings, LLC v. PFPCO.'s Noble Pie Parlor" on Justia Law

Two individuals worked as delivery drivers for a transportation company for over a decade, primarily out of the company’s New Jersey terminal. Their work mainly involved picking up and delivering goods in New Jersey, with occasional deliveries in neighboring states. Each driver had a contract with the company that included a forum-selection clause requiring any disputes to be litigated in Memphis, Tennessee, and a choice-of-law clause providing that Tennessee law would govern any disputes. The company is incorporated in Delaware, headquartered in Illinois, and has operations nationwide, including in Tennessee, but neither the drivers nor the company’s relevant activities were based in Tennessee.The drivers filed a putative class action in the United States District Court for the District of New Jersey, alleging that the company violated New Jersey wage laws by withholding earnings and failing to pay overtime, among other claims. The case was transferred to the United States District Court for the Western District of Tennessee pursuant to the forum-selection clause. The company then moved to dismiss the complaint, arguing that the Tennessee choice-of-law provision applied and that Tennessee law did not recognize the claims brought under New Jersey statutes. The district court agreed, upheld the choice-of-law provision, and dismissed the case.On appeal, the United States Court of Appeals for the Sixth Circuit reviewed the enforceability of the choice-of-law provision under Tennessee’s choice-of-law rules. The court held that the contractual choice-of-law clause was unenforceable because there was no material connection between Tennessee and the transactions or parties. As a result, the Sixth Circuit reversed the district court’s dismissal and remanded the case for further proceedings. The court did not reach the question of whether Tennessee law was contrary to the fundamental policies of New Jersey. View "Andujar v. Hub Group Trucking, Inc." on Justia Law

During the COVID-19 pandemic, a university in Nebraska instituted a policy requiring all students to be vaccinated against COVID-19 by a specified deadline, with the only exemptions allowed for medical reasons or until a vaccine received full FDA approval. Religious exemptions were not permitted. Students who failed to comply were unenrolled and barred from campus, and some had holds placed on their accounts, preventing access to transcripts. One student complied with the mandate but suffered adverse effects and was medically exempted from further doses. Another student withdrew voluntarily before the deadline.After the university enforced the mandate, several students sought injunctive relief in the District Court for Douglas County to prevent their unenrollment, alleging breach of contract and unjust enrichment. The court denied relief, finding that any contract included the Emergency Use Authorization waiver agreements and that the students breached the contract by not being vaccinated after FDA approval. An initial appeal was dismissed by the Nebraska Supreme Court for lack of a final, appealable order. The students then consolidated their actions and filed an operative complaint alleging breach of implied contract, denial of due process, conversion, negligence, and violations of the Nebraska Consumer Protection Act (NCPA). The district court dismissed the complaint with prejudice and denied leave to amend.The Nebraska Supreme Court reviewed the district court’s dismissal de novo and found that the students plausibly alleged claims for breach of an implied contract and conversion, based on the university’s unilateral modification of conditions mid-semester and the withholding of transcripts. The court affirmed the dismissal of the negligence and NCPA claims, finding them preempted by the federal Public Readiness and Emergency Preparedness Act, and held that the due process claim was abandoned on appeal. The case was affirmed in part, reversed in part, and remanded for further proceedings on the breach of contract and conversion claims. View "Ramaekers v. Creighton University" on Justia Law

A dispute arose between two siblings, Wayne Orkin and Lisa Albert, over the operation and ownership of a business called Boost Web SEO, Inc. Orkin managed the day-to-day business and generated all of its revenue, while Albert incorporated the company and was listed as its registered agent and officer. No written agreements clarified their roles, profit sharing, or compensation. In 2014, residual income from a payment processing arrangement was assigned to Boost Web, which both parties treated as company revenue for years. In 2021, after a breakdown in their relationship, Albert cut Orkin’s access to company funds and accused him of fraudulent activities in communications with a third-party vendor. Orkin then redirected company revenues to an account he controlled, prompting legal action.The litigation began in Massachusetts Superior Court, where Orkin (and his father) sued Albert and her son for various state-law claims, and Albert removed the case to the U.S. District Court for the District of Massachusetts. Boost Web intervened with a crossclaim against Orkin. After partial summary judgment, the remaining claims—Orkin’s defamation and related claims against Albert, and Boost Web’s conversion claim against Orkin—proceeded to a bench trial. The district court ruled for Albert on the defamation claim, finding her email was not defamatory or was protected as true, and for Boost Web on conversion, awarding it damages for funds Orkin took as personal expenses and for redirected residuals. The court also found Orkin in contempt for interfering with its orders and permanently enjoined him from pursuing related litigation in Florida.The United States Court of Appeals for the First Circuit reviewed the case. It held that the district court erred in dismissing Orkin’s defamation claim, finding that Albert’s email could be defamatory per se and remanded for further proceedings on truthfulness. It affirmed the conversion judgment regarding the redirected residuals but vacated the judgment concerning personal expenses, holding that Orkin was entitled to some compensation and remanded to determine the appropriate amount. The court vacated the contempt order and the permanent injunction, finding the previous orders did not unambiguously decide Boost Web’s ownership. The case was remanded for further proceedings consistent with these holdings. View "Orkin v. Albert" on Justia Law

Russ and Debi Ropken hired a construction company to build a custom home based on an oral agreement. The contractor began work and sent invoices for services and materials, which the Ropkens paid until May 2022, after which they stopped making payments. In July 2022, the Ropkens removed the contractor from the site. The contractor then sent a demand letter for three unpaid invoices totaling $276,169, but the Ropkens refused to pay. The contractor sued to recover the unpaid amount.In the District Court of Park County, the Ropkens admitted owing at least $176,870.21. At the conclusion of a jury trial, the jury found there was a valid contract, the Ropkens had breached it, and awarded the contractor $258,587.70 in damages. The district court entered judgment for that amount and permitted the contractor to request prejudgment interest. The contractor timely filed for prejudgment interest, and the Ropkens objected. The district court found for the contractor, awarding $33,473.25 in prejudgment interest at a statutory rate, and calculated interest from the date of the demand letter. The Ropkens paid the judgment but appealed the prejudgment interest award.The Supreme Court of Wyoming reviewed whether the district court erred in awarding prejudgment interest and whether due process was violated by granting interest without an evidentiary hearing. The court held that a district court may award prejudgment interest even when it is not the trier of fact, as prejudgment interest is a matter of law and not fact. The court found the claim was liquidated and the Ropkens had notice. The court also held that the Ropkens received adequate notice and opportunity to be heard, satisfying due process. The Supreme Court of Wyoming affirmed the award of prejudgment interest. View "Ropken v. Yj Construction, Inc." on Justia Law