Justia Contracts Opinion Summaries

Stresscon Corporation, a subcontracting concrete company, filed suit against Travelers Property Casualty Company of America, alleging, among other things, that Travelers acted in bad faith, unreasonably delaying or denying its claim for covered insurance benefits; and Stresscon sought awards of two times the covered benefits along with fees and costs, as prescribed by statute. Stresscon’s claims for relief arose from a 2007 serious construction accident which was caused by a crane operator employed by a company that was itself a subcontractor of Stresscon. Stresscon’s general contractor, Mortenson, sought damages from Stresscon, asserting Stresson’s contractual liability for the resulting construction delays, and Stresscon in turn sought indemnification from Travelers. Travelers petitioned for review of the court of appeals’ judgment affirming the district court’s denial of its motion for directed verdict in a lawsuit brought by its insured, Stresscon. Much as the district court had done, the appellate court rejected Travelers’ contention that the no-voluntary-payments clause of their insurance contract relieved it of any obligation to indemnify Stresscon for payments Stresscon had made without its consent. Instead, the court of appeals found that the Colorado Supreme Court's opinion in "Friedland v. Travelers Indemnity Co.," (105 P.3d 639 (2005)) had effectively overruled the Court's prior “no voluntary payments” jurisprudence to the contrary and given Stresscon a similar opportunity. The Supreme Court reversed, finding that its adoption of a notice-prejudice rule in "Friedland" did not overrule any existing “no voluntary payments” jurisprudence. The Court declined to extend a notice-prejudice reasoning to Stresscon’s voluntary payments, made in the face of the no-voluntary-payments clause of its insurance contract with Travelers. View "Travelers Prop. Cas. Co. v. Stresscon Co." on Justia Law

The issue this case presented for the Colorado Supreme Court's review centered on whether dissatisfied beneficiaries of a testator’s estate have standing to bring legal malpractice or claims against the attorney who drafted the testator’s estate planning documents. Specifically, petitioners Merridy Kay Baker and Sue Carol Kunda sought to sue respondents Wood, Ris & Hames, Professional Corporation, Donald L. Cook, and Barbara Brundin (collectively, the Attorneys), who were the attorneys retained by their father, Floyd Baker, to prepare his estate plan. Petitioners asked the Supreme Court to abandon what was known as the "strict privity rule," which precluded attorney liability to non-clients absent fraud, malicious conduct or negligent misrepresentation. The advocated instead for a "California Test" and for an extension of the third-party beneficiary theory of contract liability (also known as the Florida-Iowa Rule), both of which petitioners asserted would allow them as the alleged beneficiaries of the estate, to sue the Attorneys for legal malpractice and breach of contract. After review of this case, the Supreme Court declined to abandon the strict privity rule, and rejected petitioners' contention that the court of appeals erred in affirming dismissal of their purported fraudulent concealment claims. View "Baker v. Wood, Ris & Hames" on Justia Law

In 1989, Alva Hickerson signed a ten-year promissory note payable to Vessels Oil and Gas Company. Under the terms of the note, the debt was due for full payment in 1999. The holder of the note sued in 2009 for collection of the full, unpaid amount of the debt, plus interest. The six-year statute of limitations would have barred suit after 2005, but the unpaid balance was restarted because a partial payment was deemed a promise to repay the remaining debt. The trial court allowed the laches defense, but the Court of Appeals ruled that Colorado's separation of powers doctrine prohibited a court form applying laches to shorten the filing period. Upon review of the matter, the Supreme Court held that the separation of powers doctrine did not bar a laches defense to a debt collection action filed within the original or restarted limitations period because laches does not conflict with the statute of limitation. View "Hickerson v. Vessels" on Justia Law

Bristol Bay Productions, LLC brought claims against author Clive Cussler in California for fraud based on allegations that he had misrepresented his readership numbers. Bristol Bay alleged Cussler told it he had sold over 100 million books when the figure was, in fact, closer to 40 million. According to Bristol Bay, it reasonably relied on those numbers when it purchased the film rights to Cussler's books and produced an ultimately unsuccessful movie based on one of them (Sahara), with resulting damages of more than $50 million. In a special verdict, a California jury found Cussler misrepresented his readership figures and that Bristol Bay reasonably relied on those misrepresentations, but that Bristol Bay's reliance on those misrepresentations did not cause its damages. Bristol Bay also sued Cussler's literary agent and publishers for fraud in Colorado based on the same allegations asserted in the California suit. Following Bristol Bay's unsuccessful appeal of the California action, the trial court dismissed Bristol Bay's Colorado action on issue preclusion grounds for failing to state a claim. The court of appeals affirmed. Bristol Bay appealed the Colorado courts' dismissal. After review, the Colorado Supreme Court concluded Bristol Bay's Colorado action was indeed barred on issue preclusion grounds. However, the Colorado Court held the trial court erred by dismissing Bristol Bay's Colorado action without converting the defendants' motion to dismiss into a motion for summary judgment. View "Bristol Bay Prods., LLC v. Lampack" on Justia Law

In 2000, Gregory T. Ludlow, S. Reid Ludlow, and Jean E. Cowles entered into an exclusive listing agreement with real estate brokerage firm Gibbons-White, Inc. for the sale of approximately 131 acres of vacant land in Boulder County. Over the next seven years, the Sellers received offers from at least three different buyers to purchase portions of the land; none of the offers resulted in a completed sale. In 2007, Actis, LLC made an offer to purchase half of the land. The issue before the Supreme Court in this matter stemmed from that offer. The Court concluded that to sustain a professional malpractice claim against a transactional real estate broker, a plaintiff must show that but for the alleged negligent acts of the broker he either:(1) would have been able to obtain a better deal in the underlying transaction; or (2) would have been better off by walking away from the underlying transaction. The Court concluded that the Sellers here failed to present evidence of damages because they did not establish beyond mere speculation they suffered a financial loss because of the transactional brokers' professional negligence. View "Gibbons v. Ludlow" on Justia Law

The issue before the Supreme Court in this case was whether the appellate court erred including that where reasonable attorney fees were provided for in a contract, and the judgment based on that contract was reduced by a counterclaim arising out of the transaction, the trial court must apportion the fees according to the amount recovered on the contract less the amount received in the counterclaim. The Court concluded that under the circumstances of this case, determining whether and how to apportion fees between the parties is within the trial court's discretion, and can only be overturned by an abuse of that discretion. View "Planning Partners Int'l, LLC v. QED, Inc." on Justia Law

Respondents Christopher Roinestad and Gerald Fitz-Gerald were overcome by poisonous gases while cleaning a grease clog in a sewer near the Hog's Breath Saloon & Restaurant. The district court concluded that Hog's Breath caused respondents' injuries by dumping substantial amounts of cooking grease into the sewer thereby creating the clog and consequent build up of the gas. On summary judgment, the district court found the saloon liable under theories of negligence and off-premises liability and granted respondents damages. The saloon carried a commercial general liability policy issued by Petitioner Mountain States Mutual Casualty Company which sought a ruling it had no duty to indemnify Hog's Breath. The district court agreed that under the terms of the policy, the insurer had no duty under a pollution exclusion clause. The appellate court reversed the ruling in favor of the insurer, finding the pollution exclusion clause was ambiguous and that its application to cooking grease (a common waste product) could lead to absurd results and negate essential coverage. Upon review, the Supreme Court reversed, finding that the saloon released enough grease to amount to a discharge of a pollutant, and that the insurance policy pollution exclusion clause barred coverage in this case. View "Mountain States Mutual Casualty Company v. Roinestad" on Justia Law

Petitioner Northstar Project Management, Inc (Northstar) entered into a contract with Respondent DLR Group, Inc. for the construction of a new building. DLR began performing under the contract and submitted invoices to Northstar. Northstar paid DLR in part, but became dissatisfied with DLR's performance before fully satisfying DLR's invoices. Negotiations proved unsuccessful between the parties and Northstar terminated the contract. Northstar sued DLR for breach of contract and related declaratory relief. DLR counterclaimed for breach of contract and declaratory relief. The court admitted a number of exhibits as evidence of the parties' contract claims. Northstar ultimately prevailed at trial. DLR filed a post-trial motion for judgment notwithstanding the verdict, arguing that Northstar failed to meet its prima facie case and that the verdict was not supported by any proper measure of damages. Specifically, DLR took issue with the trial court's admission of several trial exhibits, and argued that the admission of these exhibits led the jury to award "excessive damages" to Northstar. DLR appealed that denial; the appellate court's reversal of the trial court. The Supreme Court held that the appellate court erred when it held that the record designated by DLR on appeal satisfied C.A.R. 10(b). Therefore, the court of appeals did not have the information necessary to determine whether the evidence sufficiently supported the jury's verdict in favor of Northstar. View "Northstar v. DLR Group, Inc." on Justia Law

Through cold calls, defendants sold plaintiffs shares in oil and gas joint ventures in Texas, Alabama and Mississippi. Plaintiffs all signed agreements with forum selection clauses stating that courts in Dallas County, Texas would have exclusive jurisdiction should any disputes arising from the agreements arise. The ventures lost money, and plaintiffs sued in Colorado, raising violations of the Colorado Securities Act (CSA) and various other common-law claims. Defendants moved to dismiss all claims citing the forum selection clause. Plaintiffs argued on appeal that the clauses were void because they were unenforceable on public policy grounds. Upon review, the Supreme Court held that the forum selection clauses were valid, and that they requires the parties to litigate their claims in Texas. View "Cagle v. Mathers Family Trust" on Justia Law

At issue before the Supreme Court in this case was whether certain terms contained in a credit agreement between a lender and a bank was ambiguous with regard to the default interest rate. Because the Court held that the credit agreement was not ambiguous, it did not address whether Colorado's Credit Agreement Statute of Frauds allowed for the introduction of extrinsic evidence to resolve a facially ambiguous credit agreement. View "FDIC v. Fisher" on Justia Law