Justia Contracts Opinion Summaries

AgStar Financial Services, ACA (AgStar) appealed the district court’s award of attorney fees to Northwest Sand & Gravel, Inc., Gordon Paving Company, Inc., and Blackrock Land Holdings, LLC (collectively, Gordon Paving), following a deficiency proceeding. Gordon Paving’s cross-appeal asserted that the district court erred in three respects: (1) by permitting AgStar to sell personal property serving as collateral for Gordon Paving’s debt to AgStar after the district court determined that AgStar was not entitled to a deficiency judgment; (2) by awarding AgStar post-judgment attorney fees; and (3) allowing AgStar’s claim of exemption to a royalty check. AgStar moved the district court for an order directing Gordon Paving to transfer the titles of various vehicles that Gordon Paving had pledged as collateral for certain bond obligations to AgStar, and for a comfort order allowing AgStar to sell the personal property collateral at auction. Gordon Paving opposed AgStar’s motion, arguing that because the district court had already determined that AgStar had received real property worth more than the debt owed under the foreclosure judgment and denied AgStar a deficiency judgment, AgStar was estopped from selling any further collateral because Gordon Paving’s debt was extinguished. Gordon Paving moved for an award of attorney fees, asserting that, as the prevailing party in the deficiency proceeding, it was entitled to attorney fees. AgStar opposed Gordon Paving’s request for attorney fees. After review, the Supreme Court found: (1) the district court abused its discretion when it awarded attorney fees without first determining the prevailing party in the entire action; (2) the district court did not err when it held a bond agreement did not bar Gordon Paving from being awarded attorney fees; (3) the district court erred when it allowed AgStar to continue to sell the personal property collateral to satisfy the foreclosure judgment. The Court did not reach the issue of the district court’s award of post-judgment attorney fees to AgStar because Gordon Paving did not support its claim with sufficient argument or authority. As such, the Court reversed the district court’s order allowing AgStar to sell the personal property collateral to satisfy the foreclosure judgment; vacated the judgment awarding attorney fees and costs to Gordon Paving; and remanded for the district court to determine attorney fee and cost issues and for further proceedings. View "Agstar Financial v. NW Sand & Gravel" on Justia Law

Homeowners obtained loans from Bank for the construction of a new home and entered into an agreement with Contractor to complete the new home construction. When Homeowners defaulted on payments owed to Contractor and on both loans, the house was sold at foreclosure, and Homeowners filed for bankruptcy. Contractor filed a fourth amended complaint against Homeowners, who were later dismissed as parties, and Bank. Following a trial the court granted summary judgment for Bank on Contractor’s claims of fraud and civil conspiracy. The Supreme Court reversed. After remand, Contractor filed a fifth amended complaint, which differed from the fourth amended complaint in several respects. The district court determined that the election of remedies doctrine and judicial estoppel required a dismissal of Contractor’s claims. The Supreme Court reversed, holding (1) Contractor’s claims were consistently premised on the existence of a contract, and therefore, no election was required; and (2) Contractor’s claims were based on different facts and obligations, and therefore, both could be pursued. View "deNourie & Yost Homes, LLC v. Frost" on Justia Law

GEM Razorback, LLC appealed a judgment dismissing its declaratory judgment action because GEM failed to exhaust administrative remedies, and dismissing its claim for specific performance because GEM could not establish that it was a third-party beneficiary of a contract. GEM and Zenergy, Inc. owned working interests in two oil and gas wells located in McKenzie County. Zenergy operated the wells, but GEM had not consented to pay its share of the drilling and operating costs. GEM did not execute a joint operating agreement for the wells and consequently was assessed a risk penalty as a nonconsenting owner. In 2013, Zenergy assigned its interest in the wells to Oasis Petroleum North America LLC. The assignment conveyed all assets, including "all files, records and data maintained by" Zenergy. After the assignment, GEM requested the same information from Oasis. Oasis provided Zenergy with the requested information. However, according to Oasis, some of the requested information for the time period before the assignment was not in its possession. Because of differences in the numbers provided by Zenergy and Oasis, GEM filed applications for hearing with the Industrial Commission requesting that the Commission determine the actual reasonable costs plus risk penalty for the two wells. After a hearing, Oasis agreed to allow GEM to conduct an audit of the wells. The Commission then dismissed the applications without prejudice. During the ensuing audit process, GEM discovered there were documents it requested that were not in Oasis' possession for the time period before the assignment when Zenergy operated the wells. GEM contacted Zenergy and requested an extensive list of 39 specific types of information regarding the wells. Zenergy refused to provide GEM with the requested information. GEM then commenced its declaratory judgment and specific performance action against Zenergy. Zenergy argued the district court lacked subject matter jurisdiction over the request for declaratory relief because GEM failed to exhaust its administrative remedies with the Commission before filing the complaint. Zenergy further argued the claim for specific performance failed to state a claim upon which relief could be granted because a provision of the assignment agreement specifically bars third-party beneficiary status. The court agreed with Zenergy's arguments and dismissed GEM's action. Finding no reversible error, the Supreme Court affirmed the district court’s ruling. View "GEM Razorback, LLC v. Zenergy, Inc." on Justia Law

The Funny Guy, LLC sued Lecego, LLC, claiming that it was not paid for work it did for Lecego. Funny Guy alleged that Lecego had agreed to pay approximately ninety-seven percent of the fees claimed in an attempt to resolve the dispute but later refused to do so. The trial court sustained Lecego’s demurrer, finding that no such settlement ever existed. Thereafter, Funny Guy again sued Lecego asserting two alternative theories of recovery - breach of contract and quantum meruit. The trial court dismissed this second suit on the basis of res judicata, concluding that these two alternative theories of recovery could have been, and should have been, asserted in the first suit. The Supreme Court affirmed, holding that the trial court properly applied res judicata in this case. View "The Funny Guy, LLC v. Lecego, LLC" on Justia Law

In 2010, Havre High School’s roof partially collapsed. Dick Anderson Construction, Inc. (Anderson) built the roof and Springer Group Architects (Springer) designed it. Hill County High School District No. A filed suit against against Springer and Anderson, alleging negligence, breach of express and implied warranty, breach of contract, negligent misrepresentation, deceit, and fraud. The district court granted summary judgment in favor of Springer and Anderson, concluding that the statute of repose time-barred the School District’s claims. The Supreme Court affirmed, holding that the district court did not err in (1) concluding that the statute of repose barred the School District’s claims; (2) ruling that the period of repose could not be tolled; and (3) awarding Spring attorney fees under the contract. View "Hill County High School District No. A v. Dick Anderson Construction, Inc." on Justia Law

Plaintiffs borrowed $110 million in 2007 from Bear Stearns to finance the purchase of Rincon Towers, a San Francisco apartment complex. In 2010, after plaintiffs failed to repay the loan and after changes in the ownership of the loan, CP III purchased the property at a nonjudicial foreclosure sale. Plaintiffs sued CP III and other entities who were involved in administering the loan, unsuccessful workout negotiations, and the eventual foreclosure sale. The trial court rejected all of their claims. The court of appeal remanded plaintiffs’ legal claims (breach of contract, fraud, slander of title, trade secret misappropriation), finding that the trial court erred in striking their demand for a jury trial, but affirmed as to the equitable claims (unfair competition, to set aside the foreclosure sale, and for an accounting). View "Rincon EV Realty, LLC v. CP III Rincon Towers, Inc." on Justia Law

After a jury found CSX solely liable for injuries suffered by an employee of General Mills and awarded the employee damages, CSX filed this action for indemnification from General Mills. The district court dismissed on the ground that the contract between the parties barred indemnification for damages arising from CSX's sole negligence. In reaching this result, the district court applied a federal rule of collateral estoppel to bar relitigation of the relative fault of General Mills for the injury suffered by its employee. The court held, however, that federal common law adopts the state rule of collateral estoppel to determine the preclusive effect of a judgment of a federal court that exercised diversity jurisdiction. Accordingly, the court reversed and remanded for the district court to determine whether collateral estoppel bars the complaint of CSX for indemnification. The court declined to decide the dispute regarding one element of collateral estoppel as defined by Georgia law: the earlier litigation must have been between identical parties. The court also declined to decide the alternative argument raised by CSX, whether the Sidetrack Agreement requires indemnification assuming CSX was solely at fault. View "CSX Transportation, Inc. v. General Mills, Inc." on Justia Law

In 1994, Petitioner filed this lawsuit against his brother and nephew (together, Respondents) alleging claims resulting from deteriorating business relationships within the family. The first trial resulted in a hung jury, and mistrial was declared. Petitioner’s subsequent amendments to his complaint culminated in a fifth amended complaint filed in 2009. The jury found in favor of Petitioner on all three counts he alleged. On appeal, the Third District Court of Appeal concluded that Respondents were entitled to judgment as a matter of law because the evidence did not support any of Petitioner’s claims. The district court also reversed on the grounds that Petitioenr’s claims were barred by the statute of limitations, as the fifth amended complaint did not relate back to the original. The Supreme Court quashed the Third District’s decision, holding (1) an amendment asserting a new cause of action can relate back to the original pleading where the claim arises out of the same conduct, transaction, or occurrence as the original; and (2) there was sufficient evidence to sustain the jury’s verdict on Petitioner’s breach of oral promise claim. Remanded. View "Kopel v. Kopel" on Justia Law

Jeremy and Jessica Litster appealed a district court dismissal on summary judgment. The case concerned the enforceability of three promissory notes, which were prepared and issued by Jeremy to Jason Lee , Scott McNab, and a non-party, Rick Lee. In February 2009, Jeremy learned of an "investment opportunity" that required a minimum buy-in of $500,000. Jeremy and Jason solicited close friends and family to "invest" by transferring money to them, which would later be transferred to Jeremy's relative, Marc Jenson. Ultimately, the "investment" failed, and Plaintiffs and other "investors" looked to Jeremy for repayment. Jeremy made payments on these promissory notes. However, in July 2011, Jeremy stopped making payments because he learned that the Idaho Department of Finance had been notified regarding his investment solicitation activity. Plaintiffs filed a complaint against the Litsters in 2014, alleging three counts of breach of contract for failure to pay the amounts due according to the promissory notes. The Litsters answered asserting, inter alia, the affirmative defense that the notes were issued under duress. Plaintiffs filed a motion for summary judgment of the issues of breach of contract and duress. The district court granted Plaintiffs' motion. On the issue of duress, the district court found in Plaintiffs' favor under two different legal theories: (1) the Litsters failed to provide sufficient evidence of their claim for duress to create a genuine issue of material fact; and (2) the district court noted that the undisputed evidence demonstrated that Jeremy ratified the promissory notes by making payments thereon. It concluded that, in addition to the absence of a genuine issue of material fact, the Litsters' "claim for duress fails because [Jeremy ] ratified the contracts by making payments on the [n]otes." The Supreme Court affirmed summary judgment, finding that the Litsters failed to contest the alternate grounds upon which the summary judgment was granted. View "Lee v. Litster" on Justia Law

In June 2002, defendant Ron Miller entered into an open account agreement with plaintiff Union Lumber Company for the purchase of building supply materials. In July 2010, plaintiff filed an action for breach of contract and unjust enrichment against Ron Miller and his spouse Linda Miller, seeking $17,865 as the unpaid balance on the account. The complaint alleged that defendants' son, Ean Miller, had purchased building materials from plaintiff, charging those materials to the Miller account with his father's authority. The complaint further alleged that the materials that Ean purchased were delivered to properties that defendants owned and were used to improve those properties and that, for several years, defendants had paid the charges that Ean had made on the account. The question this case presented for the Supreme Court's review was whether the trial court erred in denying defendants' motion under ORCP 71 B(1) to set aside a general judgment entered against them on grounds of excusable neglect and mistake. The Court of Appeals reversed the trial court's ruling, concluding that the judgment was entered as a result of mistakes made by plaintiff and a court-appointed arbitrator with respect to the service of case-related documents on defendants. Because the Supreme Court concluded that defendants were not entitled to relief from the judgment on the grounds asserted, it reversed the Court of Appeals and affirmed the trial court's order denying defendants' motion to set aside the judgment. View "Union Lumber Co. v. Miller" on Justia Law