Justia Contracts Opinion Summaries

After remand, the trial court ruled that H.A.S. Electrical Contractors, Inc. (HAS) failed to meet its burden of proving purposeful discrimination. Hemphill Construction Company was the general contractor on a project in Waveland, Mississippi, to rebuild a state park after Hurricane Katrina. Hemphill entered a subcontract with HAS (one of many entered into between these companies - both before and after the event complained of) to perform the electrical work. According to HAS, Hemphill did not pay HAS all it was owed under the subcontract. HAS sued Hemphill for breach of contract, quantum meruit, and conversion. After a three-day trial, the jury found in favor of Hemphill on both HAS’s claims and Hemphill’s counterclaim. However, the jury declined to award Hemphill monetary damages. The subcontract entitled the “prevailing party” to reasonable attorney’s fees and expenses. HAS filed a motion for new trial or, in the alternative, a motion for judgment notwithstanding the verdict (JNOV), arguing the trial court erred: (1) in allowing Hemphill to use two of its peremptory strikes to exclude two African Americans from the jury, arguing neither pretext nor purposeful discrimination; and (2) in not finding the unilateral attorney’s-fees provision of the contract to be unconscionable. The trial court denied HAS’s motion for new trial and alternative motion for JNOV. In its briefs appealing the trial court ruling to the Mississippi Supreme Court, HAS challenged the attorney’s-fees award and argued the trial court mishandled the Batson hearing when HAS challenged Hemphill’s use of peremptory strikes on the African-American jurors. The Supreme Court affirmed, finding HAS failed to prove: (1) purposeful discrimination in the jury selection process; (2) that the trial court’s ruling was clearly erroneous; or (3) that the trial court’s ruling was against the overwhelming weight of the evidence. Accordingly, the Court affirmed the jury’s verdict, the trial court’s denial of HAS’s motion for new trial, and the trial court’s post-judgment award of attorney’s fees to Hemphill. View "H.A.S. Electrical Contractors, Inc. v. Hemphill Construction Company, Inc." on Justia Law

In 2012, Khalil Laleh brought a forcible entry and detainer action against his brother, Ali Laleh. The litigation later grew so unwieldy that the trial court appointed Gary Johnson as an accounting expert (and later as a special master) to resolve the feuding brothers’ complex accounting claims. The Laleh brothers signed an engagement agreement with Gary C. Johnson and Associates, LLC, setting forth the scope of Johnson’s services and payment. Johnson commenced work, but before he completed his accounting reports for the trial court, the brothers settled their case and the court dismissed the suit. Johnson later informed the trial court that Khalil and Ali refused to pay both his outstanding fees and his costs incurred post-settlement in attempting to collect the outstanding fees. Following a hearing, the trial court issued an order ruling that Johnson’s fees were reasonable, and that he was entitled to the post-settlement costs he incurred in trying to collect his outstanding fees. In reaching the latter conclusion, the trial court relied on language in the engagement agreement stating that the Lalehs “are jointly and severally responsible for the timely and complete payment of all fees and expenses” to Johnson. The Colorado Supreme Court concluded that a separate provision of the engagement agreement authorized the award of the disputed post-settlement collection costs. View "Laleh v. Johnson" on Justia Law

In March 2016, Catholic Health Initiatives Colorado (d/b/a Centural Health – St. Anthony North Hospital) filed suit against architectural firm Earl Swensson Associates (“ESA”) after ESA designed Catholic Health’s new hospital, Saint Anthony North Health Campus (“Saint Anthony”). Catholic Health alleged that ESA breached its contract and was professionally negligent by failing to design Saint Anthony such that it could have a separately licensed and certified Ambulatory Surgery Center (“ASC”). In December 2016, Catholic Health filed its first expert disclosures, endorsing Bruce LePage and two others. Catholic Health described LePage as an expert with extensive experience in all aspects of preconstruction services such as cost modeling, systems studies, constructability, cost studies, subcontractor solicitation, detailed planning, client relations, and communications in hospital and other large construction projects. Catholic Health endorsed LePage to testify about the cost of adding an ASC to Saint Anthony. At a hearing, ESA argued that the lack of detail in LePage’s report prevented ESA from being able to effectively cross-examine him. ESA further argued that striking LePage as an expert was the proper remedy because Rule 26(a)(2)(B)(I) limits expert testimony to opinions that comply with the Rule, and LePage offered no opinions in compliance. In 2015, the Colorado Supreme Court amended Colorado Rule of Civil Procedure 26(a)(2)(B) to provide that expert testimony “shall be limited to matters disclosed in detail in the [expert] report.” In this case, the trial court concluded that this amendment mandated the exclusion of expert testimony as a sanction when the underlying report fails to meet the requirements of Rule 26. The Supreme Court concluded the amendment created no such rule of automatic exclusion. Instead, the Court held that the harm and proportionality analysis under Colorado Rule of Civil Procedure 37(c) remained the proper framework for determining sanctions for discovery violations. Because the trial court here did not apply Rule 37(c), the Court remanded for further development of the record. View "Catholic Health v. Swensson" on Justia Law

In this discretionary appeal, and in a matter of first impression, the Pennsylvania Supreme Court considered the elements of a bad faith insurance claim brought pursuant to Pennsylvania’s bad faith statute, 42 Pa.C.S. section 8371. In 1992, while working for the United States Postal Service (“USPS”) Appellee LeAnn Rancosky purchased a cancer insurance policy as a supplement to her primary employer-based health insurance. The cancer policy was issued by Appellant Conseco Health Insurance Company (“Conseco”). To pay for the policy, Rancosky’s employer automatically deducted bi-weekly payments of $22.00 from her paycheck. The policy contained a waiver-of premium provision, which excused premium payments in the event Rancosky became disabled due to cancer. In 2003, Rancosky was diagnosed with ovarian cancer and underwent surgery and chemotherapy. Though, Rancosky did not return to her job with USPS following her hospital admission, she remained on her employer’s payroll for several months because she had accrued unused vacation and sick days. Consequently, Conseco continued to receive payroll deducted premiums from Rancosky until June 24, 2003, when Rancosky went on disability retirement. Premium payments were made in arrears; the final premium payment extended coverage under her policy to May 24, 2003. Unbeknownst to Rancosky, her physician statement inaccurately specified her date of disability as beginning on April 21, 2003, rather than on February 4, 2003. 5 Believing that the premiums had been waived and that no further premiums were due on the policy because of her disability from cancer, Rancosky’s final premium payment came from her June 24, 2003, payroll-deducted premium. Over the next two years, as Rancosky experienced several recurrences of her cancer, she continued to submit claims to Conseco. Conseco eventually started denying Rancosky’s claims for further benefits based upon her failure to pay premiums. The Supreme Court adopted the two-part test articulated in Terletsky v. Prudential Property & Cas. Ins. Co., 649 A.2d 680 (Pa. Super. 1994) in order for a plaintiff to recover in a bad faith action; proof of an insurance company’s motive of self-interest or ill-will is not a prerequisite to prevailing in a bad faith claim under Section 8371, as was argued by Appellant. The Court affirmed the superior court, which partially vacated the trial court’s judgment and remanded for further proceedings on Appellee’s bad faith claim. View "Rancosky v. Washington National Ins. Co." on Justia Law

Defendant Arch Specialty Insurance Company (Arch) appealed multiple superior court orders granting summary judgment to defendants Triage Staffing, Inc. (Triage), Exeter Hospital, Inc. (Exeter), and American Healthcare Services Association (AHSA) on their petitions for declaratory judgment, and denying Arch’s cross-motion for summary judgment. The court ruled that Arch was required to defend and indemnify Triage, Exeter, and AHSA, pursuant to two insurance policies that Arch issued to Triage, for claims asserted against the defendants by patients of Exeter who contracted Hepatitis C (Exeter Patients). On appeal, Arch argued the trial court erred in finding inapplicable certain exclusions found in the insurance policies and in determining that the claims involved multiple occurrences under the policies. After review, the New Hampshire Supreme Court reversed the superior court’s grant of summary judgment in favor of Triage and Exeter regarding Arch’s duty to defend and indemnify them pursuant to the general liability coverage forms; the Court reversed the trial court’s grant of summary judgment in favor of Exeter regarding Arch’s duty to defend and indemnify it pursuant to the umbrella coverage forms; reversed in part and vacated in part the trial court’s grant of summary judgment in favor of Triage regarding Arch’s duty to defend and indemnify it pursuant to the umbrella coverage forms, and remanded all matters to the trial court for further proceedings. View "Massachusetts Bay Insurance Company v. American Healthcare Services Association" on Justia Law

Plaintiffs Wayne and Ruth Ross, trustees of the Wayne Ross Revocable Trust and the Ruth Ross Revocable Trust, respectively, appealed a superior court order in favor of defendants Donald Ross and Rossview Farm, LLC (the LLC). Plaintiffs contested findings that the parties entered into a lease for the plaintiffs’ lifetimes and that they had no right to evict the defendants pursuant to RSA 540:2, II(d) or (e) (2007). The trial court found that plaintiffs conceded that a June 23, 2006 document satisfied the statute of frauds because, in their post-trial memorandum, plaintiffs explained their position that the June 23, 2006 document “is a writing signed by all the parties that states the terms of the parties’ agreement. This document satisfies the statute of frauds and governs their relationship.” The “clear” language of the June 23, 2006 document, plaintiffs posited, created a yearly lease. However, plaintiffs also argued in the post-trial memorandum that defendants’ introduction of parol evidence of the parties’ intent to create a perpetual lease violated the statute of frauds because “the intent of the parties to create a perpetual lease must be clear from the face of the document and there must be a document to satisfy the statute of frauds.” Thus, plaintiffs did not concede that the June 23, 2006 document satisfied the statute of frauds for all purposes; instead, they contended that it “satisfies the statute of frauds” if the document was read to create a yearly lease. The New Hampshire Supreme Court vacated and remanded, finding the trial court’s finding that plaintiffs conceded the issue lacked evidentiary support, and concluded plaintiffs did not waive their statute of frauds argument by concession. View "Ross v. Ross" on Justia Law

The Supreme Court granted the Nevada Department of Transportation’s (NDOT) petition for a writ of mandamus, holding that the district court erred in denying NDOT’s motions for summary judgment on Landowner’s contract claims concerning a settlement agreement in a condemnation action. The court held that the district court erred in declining to grant summary judgment by interpreting the parties’ agreement to include a duty imposed outside the express terms of the agreement and allowing a claim for unilateral mistake to proceed even though Landowner’s claim was barred by the applicable statute of limitations. View "State Department of Transportation v. Eighth Judicial District Court" on Justia Law

The Oklahoma Supreme Court granted certiorari to address whether disputed questions of material fact existed which precluded summary judgment in this case. In 1999, defendant-appellant, James Dalke purchased a 2000 Elliot Solitaire Mobile Home for $46,763. He paid $7,100.00 down, and financed the remaining amount with plaintiff-appellee, Green Tree Servicing, LLC. (Green Tree). The loan was perfected on September 29, 1999, at an 11.25% interest rate over 30 years. This resulted in 360 monthly payments of $387.31 totaling $139,431.60. Consequently, the cost for financing $39,877.00 for a mobile home valued at less than $47,000.00, totaled approximately $146,531.00 when the down payment was included. After making half of the total payments for fifteen years, Dalke did not make six months’ worth of payments from December 2014 to June 2015. Green Tree filed a lawsuit against Dalke, alleging that Dalke owed $49,900.34 for the remaining balance on the mobile home, not including attorney fees and other costs which they also sought. By this time, Dalke would have paid approximately $70,000 for the $39,877.00 he financed. Dalke proceeded pro se, and did not respond to Green Tree’s motion for summary judgment. The trial court granted Green Tree’s motion. Dalke appealed, claiming Green Tree went out of its way to obstruct his rights to pay any arrearages, and misrepresented the facts in the affidavit. Therefore, he contended, material fact questions existed which precluded summary judgment. The Supreme Court agreed that multiple disputed material facts existed in this case, and summary judgment was premature. View "Green Tree Servicing, LLC v. Dalke" on Justia Law

In 2013, plaintiff-respondent Gerardo Medina purchased a used car from defendant-appellant South Coast Car Company, Inc. The sales contract was eventually assigned to Veros Credit, LLC, and plaintiff sued on nine causes of action stemming from that contract. The parties settled the suit on the eve of trial. Relevant to this appeal, defendants also agreed that they would not "dispute [Medina's] underlying entitlement to attorneys' fees based upon the claims brought in the [underlying a]ction"; that Medina "shall be deemed the prevailing party on all causes of action for purposes of the motion" for attorney fees; that defendants "reserve the right to dispute the reasonableness of the attorneys' fees, costs, and prejudgment interest claimed to have been incurred" by Medina; and that defendants "maintain all defenses as to the limitations on the amount of attorneys' fees, costs, and prejudgment interest." On appeal (and despite the Settlement), defendants contend the court erred when it awarded Medina attorney fees, costs and prejudgment interest. Specifically, defendants contended that, although Medina was the prevailing party as provided under the settlement, Veros was not liable to pay any portion of his fees and costs because it was merely the "holder" of the sales contract and thus, its liability was limited to the amounts paid by Medina, or about $8,600, and that Medina, in any event, was not entitled to any such award because he previously had rejected SCCC's offer to rescind the sales contract. The Court of Appeal disagreed with defendants’ contentions, finding the record showed defendants recognized in connection with their summary judgment/adjudication motion that their settlement offer went to the " 'determination of the legal basis' " for an award of attorney fees: it would have made little sense for the parties to enter into the Settlement and not resolve what was and the overarching issue in the case, in light of the parties' extensive litigation of this issue up to the time of the settlement. View "Medina v. South Coast Car Company" on Justia Law

Plaintiff Earl Oldam raised chickens for O.K. Farms since 1995. In 2014, he and O.K. entered into the chicken-growing contract at issue in this case. The contract had a three-year duration, but O.K. retained the right to terminate the contract for certain specified reasons, including “[b]reach of any term or condition of this contract,” “[a]bandonment or neglect of a flock,” and “[f]ailure to care for or causing damage to [O.K.’s] equipment or property.” In 2016, Plaintiff discovered that one of his three chicken houses had flooded after an overnight rainstorm. Plaintiff contacted O.K. to inform them of the issue; some of the flock in the affected henhouse perished from the flood. Remaining chickens were collected by O.K. Plaintiff was paid for the work he had done in raising the surviving chickens to this point, reduced by various expenses such as the costs of catching and moving the chickens. Shortly thereafter, O.K. sent Plaintiff a letter providing him with a ninety-day notice of contract termination for breach of the terms of the contract. Plaintiff filed suit in state court, alleging that O.K. breached the contract by terminating the agreement without adequate cause. O.K. removed the action to federal court and filed a motion for summary judgment. The district court stated that it had looked at the undisputed material facts from the summary judgment pleadings and found “questions of fact galore” on all of the arguments raised by O.K. in its motion. “But,” the court continued, “all that doesn’t matter,” because Plaintiff “didn’t say come take away the chickens from the flooded henhouse. He said come take them all.” The court granted O.K.’s motion for summary judgment, reasoning that because there was “nothing in the evidentiary material showing [that the chickens in the other henhouses] were in danger at all, he abandoned them” by telling O.K. to come pick them all up. In reversing the district court’s judgment, the Tenth Circuit found plaintiff raised arguments that directly addressed the district court’s sua sponte reasoning and that he was not provided an opportunity to make at trial, and argued he was prejudiced by the district court’s entry of judgment on this basis without considering any of the contrary arguments he might have made given notice and a reasonable time to respond. The Court was persuaded that Plaintiff had shown prejudice from the trial court’s sua sponte summary judgment decision. View "Oldham v. O.K. Farms" on Justia Law