Justia Contracts Opinion Summaries

The three plaintiffs in this case had each rented rooms at an extended-stay motel for some time. They fell behind on their rent and were threatened with immediate eviction. They sued to stop that from happening, claiming that they were in a landlord-tenant relationship with the motel and could not be evicted without dispossessory proceedings in court. The motel argued that it had signed agreements with the plaintiffs that foreclosed their claims because, among other things, the agreement stated that their relationship was one of “Innkeeper and Guest,” and “not . . . Landlord and Tenant.” The trial court agreed with plaintiffs, and the Court of Appeals affirmed. After its review, the Georgia Supreme Court vacated the appellate court's opinion and remanded with direction for the trial court to determine the parties' relationship under the proper legal framework. View "Efficiency Lodge, Inc. v. Neason, et al." on Justia Law

Bennett, an oral and maxillofacial surgeon, purchased three disability income insurance policies from National in 1984, 1991, and 1995. Under the policies, monthly benefits were payable for life if he was totally disabled due to injury; if due to sickness, benefits would only be paid until the age of 65. National initially approved Bennett’s 2014 claim that he was totally disabled due to an injury sustained when thrown from his horse. In June 2015, National notified him of its determination that his disability was due to sickness, not an injury. National continued to pay disability benefits until September 2018, the policy year Bennett turned 65 years old.Bennett sued. The trial court granted National summary judgment, concluding his claims were barred by the statutes of limitation — four years for breach of contract and two years for breach of the implied covenant of good faith and fair dealing–both of which accrued when National issued an unconditional denial of liability in June 2015. The court of appeal reversed, agreeing with Bennett that his causes of action did not accrue until all elements — including actual damages — were complete. Bennett suffered no harm as of June 2015, because National continued to pay disability benefits. Only in September 2018 — when National began withholding benefits, and Bennett thereby incurred damages — did his causes of action accrue. View "Bennett v. Ohio National Life Assurance Corp." on Justia Law

Over the course of twenty-two months, Plaintiff-—a childhood victim of lead poisoning—assigned his rights to nearly one million dollars in structured settlement payments to factoring companies for pennies on the dollar. Through six transfer agreements that he lacked the capacity to understand, Plaintiff relinquished his rights to monthly payments with a total aggregate value of $959,834.42 spread over the course of about twenty-six years for a series of immediate lump-sum cash payments that amounted to $268,130. Plaintiff sued Transamerica Annuity Service Corporation and Transamerica Life Insurance Company (collectively, “Transamerica”), the entities that issued and funded his periodic payments before he assigned them. Plaintiff asserted two claims against Transamerica: one for breach of contract under New York law and the other for exploitation of a vulnerable adult under Florida’s Adult Protective Services Act (“FAPSA”), Florida Statute Section 415.1111.   The Eleventh Circuit affirmed. The court explained that Plaintiff’s FAPSA claim fails under the plain language of the statute. In his operative complaint, Plaintiff does not allege that Transamerica intended to deprive him of the use of his funds. Instead, Plaintiff asserts that Transamerica “allowed” (or “facilitated”) his exploitation by the factoring companies, which resulted in an unauthorized taking of his assets. Based on the facts that Plaintiff pleaded, Transamerica’s actions simply do not amount to “exploitation,” as that term is defined in FAPSA. Because Plaintiff has failed to state a violation of FAPSA, the court affirmed the district court’s with-prejudice dismissal of his FAPSA claim. View "Lujerio Cordero v. Transamerica Annuity Service, et al" on Justia Law

Hicks Unlimited, Inc. contracted to rent uniforms for its employees from UniFirst Corporation. The contract contained an arbitration provision stating all disputes between them would be decided by binding arbitration to be conducted "pursuant to the Expedited Procedures of the Commercial Arbitration Rules of the American Arbitration Association [AAA] and shall be governed by the Federal Arbitration Act [FAA]." A dispute arose; UniFirst moved to compel arbitration. Hicks contended the arbitration agreement was unenforceable because it did not comply with the notice requirements of South Carolina's Arbitration Act (SCAA). The circuit court denied the motion to compel arbitration, ruling the contract did not implicate interstate commerce and, therefore, the FAA did not apply. The circuit court further ruled the arbitration provision was not enforceable because it did not meet the SCAA's notice requirements. UniFirst appealed. The court of appeals reversed, holding arbitration should have been compelled because the contract involved interstate commerce and, therefore, the FAA preempted the SCAA. The South Carolina Supreme Court found that because the contract between Hicks and UniFirst did not involve interstate commerce in fact, the order of the circuit court denying UniFirst's motion to compel arbitration was affirmed, and the court of appeals' opinion was reversed. View "Hicks Unlimited v. UniFirst" on Justia Law

This case involves a contract dispute between an automobile-product manufacturer and one of its distributors. The distributor, Plaintiff Wesden, LLC, appealed the district court’s Rule 12(b)(6) dismissal of its fraud claim and summary-judgment dismissal of its breach-of-contract claim against the manufacturer, Defendant Illinois Tool Works, Inc. d/b/a ITW Evercoat (“ITW”).   The Fifth Circuit affirmed. The court explained that the issue here reduces to the plausibility of Wesden’s fraud claim. Construing the complaint in Wesden’s favor, the claim is that, at the September 2018 meeting, ITW promised Wesden that it could sell Auto Magic products through online marketplaces like Amazon and that ITW would not stop Wesden from doing so or otherwise appropriate those online markets for itself. The court concluded that Wesden’s complaint does not permit a reasonable inference of fraud. Wesden’s alleged facts do not allow us to reasonably infer that, in September 2018, ITW had “no intention” of adhering to its promise to permit Wesden’s sales on Amazon and similar marketplaces.   Further, ITW has invoked the statute of frauds to assert that the parties’ agreement is unenforceable. The court explained that a requirements contract still must satisfy the statute of frauds, which demands a written quantity term. Wesden has identified no written term either specifying a quantity of goods or stating that Wesden will buy all of its requirements from ITW. The contract thus fails to satisfy the statute of frauds and is therefore unenforceable. View "Wesdem v. Illinois Tool Works" on Justia Law

Two individuals were involved in a car accident in St. Louis, Missouri. One of the cars crashed into White Knight Diner, resulting in property damage to the restaurant. At the time, White Knight was insured by Owners Insurance Company (Owners)pursuant to a policy that provided coverage for property damage and loss of business income (the Policy). After the insurers brought several motions to dismiss, the district court dismissed all parties except for Owners and White Knight. White Knight then filed an amended complaint against Owners only, adding new causes of action, including breach of contract and breach of the implied covenant of good faith and fair dealing. Owners filed a motion for summary judgment on all claims. The district court granted Owners’ motion. White Knight appealed, arguing that disputed material facts remain as to whether Owners’ subrogation efforts were conducted in breach of the Policy.   The Eighth Circuit affirmed. The court explained that even assuming Owners’ actions were taken pursuant to the Policy, White Knight’s claim still fails because it does not establish that it suffered any damages as a result of Owners’ failure to abide by the contracted-for procedures. White Knight, as an insured party under the Policy, contracted for and paid premiums to receive insurance. And Owners settled White Knight’s claim under the Policy when Owners paid White Knight a total of $66,366.27 for property damage and business income loss. White Knight has not shown that it suffered any damages beyond the compensation it received from Owners. Without evidence of damages, a breach of contract claim fails. View "White Knight Diner, LLC v. Owners Insurance Company" on Justia Law

In March 2020, The Vail Corporation and Vail Resorts, Inc. (collectively, “Vail”) closed its ski resorts and did not reopen them until the start of the 2020–2021 ski season. Plaintiffs-Appellants (“Passholders”) were a group of skiers and snowboarders who purchased season passes from Vail to access its resorts during the 2019–2020 ski season. Passholders, on behalf of themselves and a class of similarly situated individuals, brought contractual, quasi-contractual, and state consumer protection law claims based on Vail’s decision to close due to the COVID-19 pandemic without issuing refunds to Passholders. The district court granted Vail’s Federal Rule of Civil Procedure 12(b)(6) motion to dismiss all of Passholders’ claims for failure to state a claim. Passholders appealed, arguing the district court erred in its interpretation of their contracts with Vail. Although it did not agree with the district court’s interpretation of “2019–2020 ski season,” the Tenth Circuit concurred with the ultimate conclusion that Passholders failed to state a contractual claim. Passholders sought only one form of relief in their complaint, but they purchased passes under the condition that the passes were not eligible for refunds of any kind. Recognizing that Passholders might amend their breach of contract and breach of warranty claims to seek other forms of relief, the Tenth Circuit vacated the dismissal of these two claims with prejudice and remanded for the district court to modify its judgment to a dismissal without prejudice. As with Passholders’ breach of contract and breach of warranty claims, the Court concluded the district court correctly dismissed Passholders’ consumer protection claims. Recognizing Passholders could refile these claims to seek an alternative remedy, the Tenth Circuit vacated the district court’s dismissal of Passholders’ state consumer protection law claims with prejudice so the district court could modify its dismissal of these six claims to be without prejudice. View "McAuliffe, et al. v. Vail Corporation" on Justia Law

The trial court entered judgment for Respondent in this breach of contract claim. The Second Appellate District affirmed and also imposed sanctions against Appellant's counsel for filing a frivolous appeal.The Second Appellate District explained "An appeal is frivolous only when it is prosecuted for an improper motive – to harass the respondent or delay the effect of an adverse judgment – or when it indisputably has no merit – when any reasonable attorney would agree that the appeal is totally and completely without merit." The court held that here, the appeal was frivolous because it "indisputably has no merit." The matter was entirely within the discretion of the trial court, and the fact that Appellant's counsel consulted with two other attorneys who believed the claim had merit did not change the court's opinion. View "Champlin/GEI Wind Holdings, LLC v. Avery" on Justia Law

Empire Indemnity Insurance Company issued an insurance policy (the “Policy”) to Positano Place at Naples I Condominium Association, Inc., for coverage of five buildings that Positano owns in Naples, Florida. Following Hurricane Irma, Positano filed a first-party claim for property insurance benefits under the Policy, claiming that Hurricane Irma damaged its property and that the damage was covered by the Policy. Empire determined that there was coverage to only three of the five buildings covered by the Policy but disagreed as to the amount of the loss. Positano sought to invoke appraisal based on the Policy’s appraisal provision. Positano then sued Empire in Florida state court, and Empire removed the case to federal court based on diversity jurisdiction. Positano moved to compel appraisal and to stay the case pending the resolution of the appraisal proceedings, which Empire opposed. The magistrate judge issued a report recommending that the district court grant Positano’s motion, and, over Empire’s objection, the district court ordered the parties to appraisal and stayed the proceedings pending appraisal. Empire timely appealed the district court’s order.   The Eleventh Circuit dismissed the appeal for lack of appellate jurisdiction. The court concluded that the district court’s order compelling appraisal and staying the proceedings pending appraisal is an interlocutory order that is not immediately appealable under 28 U.S.C. Section 1292(a)(1). The court also concluded that the order compelling appraisal and staying the action pending appraisal is not immediately appealable under the Federal Arbitration Act (“FAA”). View "Positano Place at Naples I Condominium Association, Inc. v. Empire Indemnity Insurance Company" on Justia Law

In 2012, Southern States Chemical, Inc. and Southern States Phosphate and Fertilizer Company (collectively, “Southern States”) sued Tampa Tank & Welding, Inc. (“Tampa Tank”) and Corrosion Control, Inc. (“CCI”), claiming damages from a faulty, leaky storage tank that Tampa Tank had installed in 2002. After a decade of litigation and multiple appeals, the trial court dismissed Southern States’s claims with prejudice, concluding that the claims were barred by the applicable statute of repose. Southern States appealed, but finding no reversible error in the trial court's judgment, the Georgia Supreme Court affirmed dismissal. View "Southern States Chemical, Inc. et al. v. Tampa Tank & Welding, Inc." on Justia Law