Justia Contracts Opinion Summaries

NDC Communications, LLC and Kenneth Carle III engaged in a complex set of agreements in the context of the development of a piece of land. When the parties’ working relationship broke down, NDC filed a complaint asserting that it was owed funds from Carle, and Carle counterclaimed seeking contract remedies and other relief. The trial court ultimately entered judgment enforcing a mechanic’s lien against Carle in the amount of $336,681.24. Carle appealed, arguing, inter alia, that the trial court failed to provide him a credit due of approximately $25,000, rendering the judgment against him inaccurate. The Supreme Judicial Court affirmed, holding (1) Carle’s due process rights were not violated by the post-trial procedures employed by the court; and (2) there was sufficient evidence in the record to support the court’s judgment, including its determination of damages. View "NDC Communications, LLC v. Carle" on Justia Law

Freddie Mac is a privately-owned, publicly-chartered financial services corporation, 12 U.S.C. 1452, created to provide stability in the secondary residential mortgage market. Piszel began working as the CFO of Freddie Mac in 2006. Piszel with a signing bonus of $5 million in Freddie Mac restricted stock units that would vest over four years, an annual salary of $650,000, and performance-based incentive compensation of $3 million a year in restricted stock. If terminated without cause, Piszel would receive a lump-sum cash payment of double his annual salary and certain restricted stock units would continue to vest. In 2008, facing Freddie Mac's potential collapse, Congress passed the Housing and Economic Recovery Act,12 U.S.C. 4511, establishing the FHFA as Freddie Mac's new primary regulator, with authority to disaffirm any contract, after which damages for the breach would be limited to “actual direct compensatory damages.” The Act contained a limit on “golden parachutes.” Piszel alleges that he was terminated without cause and Freddie Mac “refused to provide him with any of the benefits to which he was contractually entitled.” The Claims Court dismissed his allegations of an unconstitutional taking. The Federal Circuit affirmed, noting that Piszel’s breach of contract claim remains intact despite the legislation, particularly in light of Piszel’s assertion that his contract called for “deferred compensation,” rather than a golden parachute. View "Piszel v. United States" on Justia Law

A pretrial detainee asserted claims under 42 U.S.C. 1983 against guards and nurses at a regional jail. The jail authority had purchased a general liability insurance policy (the VaCorp Policy) from the Virginia Association of Counties Group Self Insurance Risk Pool (Risk Pool Association) and also elected to participate in a government-sponsored insurance program (the VaRISK Plan) managed by the Division of Risk Management (DRM). While the federal suit was pending, the detainee filed a declaratory judgment action against DRM and the Risk Pool Association seeking a determination of their respective liabilities for insuring the jail defendants. The Risk Pool Association and the DRM filed opposing third-party claims for declaratory relief. The detainee later settled with the jail defendants. The circuit court concluded (1) the VaRISK Plan was the sole primary coverage and that the DRM had the exclusive duty to defend the jail defendants, and (2) the Risk Pool Association had no duty to contribute toward the defense costs incurred by the jail defendants in the federal suit. The Supreme Court affirmed in part and reversed in part, holding (1) the VaCorp Policy and VaRISK Plan provided co-primary liability coverage to the jail defendants; and (2) VaRISK Plan’s $2 million coverage extension applicable to medical malpractice claims did not apply to the section 1983 civil rights claim alleging violations of federal constitutional law. Remanded. View "Commonwealth, Div. of Risk Mgmt. v. Va. Ass'n of Counties Group Self Ins. Risk Pool" on Justia Law

The trial court granted anti-SLAPP motions, Code of Civil Procedure section 425.16, against a city‘s exclusive agent in its action for breach of, and interference with, the agency contract and related causes of action. The court concluded that the alleged wrongful conduct in plaintiffs‘ tortious breach of contract cause of action is the City‘s violation of the terms of the Exclusive Agency Agreement (EAA) by allowing someone other than Rand Resources to act as its agent with respect to efforts to bring an NFL franchise to the City. Thus, the cause of action is not premised upon protected free speech or the right to petition for redress of grievances. The alleged wrongful conduct in plaintiffs‘ promissory fraud cause of action is the false representation regarding renewal of the EAA. Although the basis of the cause of action is a statement, the gravamen of the cause of action is the manner in which the City conducted itself in relation to the business transaction between it and Rand Resources, not the City‘s exercise of free speech or petitioning activity. The gravamen of the fourth cause of action with respect to the City is the City‘s violation of the terms of the EAA and the manner in which the City conducted itself in relation to the business transaction between it and Rand Resources, not the City‘s exercise of free speech or petitioning activity. The alleged wrongful conduct at the heart of plaintiffs‘ interference with contract and interference with prospective economic advantage causes of action is again the Bloom defendants‘ efforts to usurp Rand Resources‘s rights and role under the EAA. As addressed with respect to the fourth cause of action, this conduct arises from the Bloom defendants‘ private conduct of their own business, not their free speech or petitioning activities. Accordingly, the court reversed the order granting the anti-SLAPP motions and reversed the award of attorney fees. View "Rand Resources LLC v. City of Carson" on Justia Law

Patients filed suit to set aside accord and satisfaction agreements and to recover the amounts paid to release liens. Hospitals, health care providers who treated patients injured by third parties, were paid by the Patients' insurer, AHCCCS, which had negotiated reduced rates with the Hospitals. The Hospitals then recorded liens against the Patients pursuant to A.R.S. 33-931 and A.R.S. 36-2903.01(G) for the difference between the amount typically charged for their treatment and the reduced amount paid by AHCCCS. In order to receive their personal injury settlements with the third parties, Patients settled with the Hospitals by paying negotiated amounts to release the liens. At issue is the validity of these accord and satisfaction agreements. The court assumed, without deciding, that Arizona’s lien statutes are preempted by federal law. But, because there was a bona fide dispute about the enforceability of these liens when the Patients and Hospitals entered into settlement agreements to achieve lien releases, the agreements were supported by adequate consideration and addressed a proper subject matter. Therefore, the accord and satisfaction agreements are valid. View "Abbott v. Banner Health Network" on Justia Law

After the 2004 collective bargaining agreement (CBA) between the Unions and the Chicago Transit Authority (CTA) expired, the retiree health care benefits were the subject of an interest arbitration award. That award, which modified the retiree health care benefits, was accepted by the CTA and the Unions. Current and retired employees who had begun work with the CTA before 2001 challenged that award in a putative class action, asserting breach of contract, promissory estoppel, breach of fiduciary duty, and that the arbitration award was unenforceable under article XIII, section 5, of the Illinois Constitution, the “pension protection clause.” The circuit court ruled that the retired CTA employees had standing to challenge the modifications to their retiree health care benefits, but current CTA employees lacked standing, then dismissed for failure to state a claim. The appellate court agreed that current employees lacked standing but held that the retirees had a vested right to receive the health care benefits that were provided in the prior CBA and had stated claims for breach of that contract and for promissory estoppel. The Illinois Supreme Court held that plaintiffs who retired before the effective date of the 2007 CBA had standing; other retirees and current employees lacked standing. Dismissal of the claim for promissory estoppel against the CTA was proper; the complaint stated claims for breach of contract and under the pension protection clause. View "Matthews v. Chicago Transit Auth." on Justia Law

Plaintiffs filed suit against 24 Hour Fitness, alleging that their membership contracts did not strictly comply with several technical provisions of the Texas Health Spa Act, Tex. Occ. Code Ann. 702.304, 702.305, 702.401, 702.402(a)(2). The district court dismissed the suit based on lack of standing. Because plaintiffs are not entitled to a full refund of their membership dues, and because 24 Hour’s alleged violations of the Act did not cause plaintiffs actual damages or any other form of economic harm, plaintiffs have sustained no economic injury. Furthermore, plaintiffs have not suffered a non-economic injury where plaintiffs have suffered no cognizable statutory injury under the Act. The Act does not authorize members to sue health clubs for technical statutory violations which cause the member no harm. Moreover, the Act does not authorize health club members to recover statutory or nominal damages for mere technical violations. Accordingly, the court affirmed the judgment because plaintiffs lack Article III standing. View "Wendt v. 24 Hour Fitness USA, Inc." on Justia Law

Copia Communications, LLC, a Massachusetts company, brought this action in federal district court in Massachusetts against Seawind Key Investments, Limited, a Jamaican resort operator, and Seawind’s alleged alter-ego, AMResorts, LP, a Pennsylvania limited partnership, alleging breach of contract. The subject contract was proposed and executed in Jamaica, performance on the contract occurred almost exclusively in Jamaica, and the contract was governed by the laws of Jamaica. Both defendants, neither of which operated any business or had any corporate presence in Massachusetts, moved to dismiss, arguing lack of personal jurisdiction and forum non conveniens. The district court dismissed the case without prejudice, finding that it lacked personal jurisdiction over the defendants. The First Circuit affirmed, holding that the exercise of personal jurisdiction over the defendants was barred by the due process clause of the Fifth Amendment. View "Copia Commc’ns, LLC v. AMResorts, LP" on Justia Law

Normandy Apartments, Ltd. owned and managed a low-income rental housing project where tenants’ rents were federally subsidized under the Section 8 project-based program. In 2004, Normandy and the United States Department of Housing and Urban Development (HUD) entered into a contract (the HAP contract) wherein HUD agreed to pay rental housing assistance to Normandy. Normandy and HUD renewed the contract annually until 2004. The named parties and signatories of the 2004 HAP contract were the Oklahoma Housing Finance Authority and Normandy. In 2007, HUD notified Normandy that its assistance payments would be terminated because Normandy defaulted on the HAP contract by repeatedly failing to maintain the apartments. In 2010, Normandy filed suit against the government in the United States Court of Federal Claims asserting a breach of the 2004 HAP Contract and requesting damages. The Claims Court dismissed the case for lack of subject matter jurisdiction. Normandy then filed an amended complaint asserting a takings claim against the government. The Claims Court granted summary judgment in favor of the government. The Federal Circuit affirmed, holding (1) the Claims Court correctly dismissed Normandy’s breach of contract claim for lack of jurisdiction because the United States was not a party to the 2004 HAP contract; and (2) HUD’s conduct did not constitute a regulatory taking. View "Normandy Apartments, Ltd. v. United States" on Justia Law

Trona is a sodium carbonate compound that is processed into soda ash or baking soda. Because oil and gas development posed a risk to the extraction of trona and trona worker safety, the Bureau of Land Management (BLM), which manages the leasing of federal public land for mineral development, indefinitely suspended all oil and gas leases in the mechanically mineable trona area (MMTA) of Wyoming. The area includes 26 pre-existing oil and gas leases owned by Barlow. Barlow filed suit, alleging that the BLM’s suspension of oil and gas leases constituted a taking of Barlow’s interests without just compensation and constituted a breach of both the express provisions of the leases and their implied covenants of good faith and fair dealing. The Federal Circuit affirmed the Claims Court’s dismissal of the contract claims on the merits and of the takings claim as unripe. BLM has not repudiated the contracts and Barlow did not establish that seeking a permit to drill would be futile. View "Barlow & Haun, Inc. v. United States" on Justia Law