Justia Contracts Opinion Summaries

Gladys Garner and Randolph Scott defaulted on their respective automobile loan agreements. Both contracts were governed by the provisions of the Creditor Grantor Closed End Credit Act of the Commercial Law Article (CLEC). The contracts were later assigned to Ally Financial, Inc., Nuvell National Auto Finance, and Nuvell Financial Services (collectively, GMAC). GMAC repossessed both vehicles and informed the debtors that the vehicles would be sold at a "public auction." Both cars were later sold. The debtors filed separate complaints against GMAC alleging, in part, that GMAC violated the CLEC because the sales of their cars were in reality "private sales," requiring GMAC to provide a detailed post-sale disclosure to them under the CLEC, which GMAC had not done. The federal district court combined the cases and granted summary judgment for GMAC, concluding the sales were "public auctions" because they were both widely advertised and open to the public for competitive bidding. The federal appellate court then certified an issue for clarification to the Maryland Court of Appeals. The Court answered that the auctions were in reality "private sales" because attendance was limited to those who paid a refundable $1,000 cash deposit. View "Gardner v. Ally Fin., Inc." on Justia Law

Johnny Washington and his son were traveling in their 1994 Ford Explorer when their vehicle was struck by a driver (Karah Williams) who had run a stop sign. The Explorer rolled over twice, fatally injuring Johnny. Paulette Washington, individually and as administratrix of Johnny's estate, filed a complaint against Ford Motor Company for negligence, strict liability, failure to warn, and breach of warranties. The jury returned a verdict finding that Ford and Williams, in equal measure, had been the proximate cause of Johnny's death. The jury awarded $4,652,125 in compensatory damages and $2.5 million in punitive damages. Ford appealed. The Supreme Court dismissed the appeal without prejudice for lack of jurisdiction, holding that the judgment was not final because it did not set forth a specific dollar amount owed by Ford. View "Ford Motor Co. v. Washington" on Justia Law

Plaintiffs, Massachusetts residents, bought a three-dwelling in Massachusetts, financing the entire purchase price with two mortgage loans from Plaza Home Mortgage (Plaza). After the collapse of the housing market, Plaintiffs sued Plaza, alleging state common law and statutory violations in making the loans. The district court dismissed for failure to state a claim. The First Circuit Court of Appeals affirmed, holding (1) the district court correctly dismissed Plaintiffs' claim based on Plaza's alleged violation of the Massachusetts covenant of good faith and fair dealing; and (2) Plaintiffs' claim based on a violation of the Massachusetts consumer protection was correctly dismissed as time-barred. View "Latson v. Plaza Home Mortgage, Inc." on Justia Law

Plaintiff-Appellant Adriana Berneike appealed the district court’s dismissal of her Real Estate Settlement Procedures Act (RESPA), Utah Consumer Sales Protection Act (UCSPA), and breach of contract claims asserted against CitiMortgage, Inc. (Citi). In 2010, Plaintiff faxed twenty-eight different letters to Citi, her mortgage loan servicer, asserting that Citi was incorrectly billing her for overcharges and improper fees. She faxed a two more rounds of different letters, insisting Citi was overcharging her. Citi replied that Plaintiff's account was correct and that taxes and an escrow shortage caused billing fluctuation. Several months later, Plaintiff sent a third round of fort-seven different letters to Citi claiming billing errors. Altogether, Plaintiff faxed more than one hundred letters to Citi, and claimed that despite paying in full every bill she received, she continued to be overcharged and was facing foreclosure and bankruptcy. Plaintiff then filed suit in Utah state court. Among other damages, she sought $1,000 per violation of RESPA. Citi removed the case to federal court, and the court subsequently granted Citi's motion to dismiss Plaintiff's claims. Finding that the federal court did not err by dismissing Plaintiff's claims, the Tenth Circuit affirmed the lower court's decision. View "Berneike v. CitiMortgage, Inc." on Justia Law

Plaintiff leased a vehicle from BMW. Plaintiff claimed the leased vehicle was defective and brought suit against BMW. After a bench trial, the trial court awarded Plaintiff $25,157 in damages based on Minnesota's lemon law. The district court then granted Plaintiff's motion for an award of attorney fees and litigation costs, awarding Plaintiff a total of $229,064 in fees and costs. In reaching its conclusion on attorney fees, the court determined that it was "improper to compare the amount of reasonable legal fees to the amount of recovery in determining the proper fee award." The court of appeals affirmed. The Supreme Court reversed, holding (1) the amount involved in the litigation and the results obtained are relevant factors that the district court is to consider in awarding attorney fees under Minnesota's lemon law; and (2) the district court abused its discretion by failing to consider these factors in awarding attorney fees under the lemon law. Remanded. View "Green v. BMW of N. Am., LLC" on Justia Law

Plaintiffs, Prius owners, brought a putative class action suit against Toyota, alleging that they experienced defects in their anti-lock brake systems (ABS), resulting in increased stopping distances. On appeal, Toyota sought review of the district court's denial of their motion to compel arbitration. The court concluded that Toyota could not compel plaintiffs to arbitrate their claims. The district court had the authority to decide whether Toyota, a nonsignatory to the Purchase Agreement, could compel arbitration. The court discerned no reason that plaintiffs should be equitably estopped from avoiding arbitration in this case. Accordingly, the court affirmed the judgment. View "Kramer, et al v. Toyota Motor Corp., et al" on Justia Law

Plaintiffs, a car owner and the purchaser of that car, filed suit against Advance Stores, which supplied a car battery to the original owner. The battery died shortly after the second owner purchased the car, and Advance Stores refused to provide a free replacement under the limited warranty. After the Supreme Court answered a certified question and remanded the case, the trial court allowed Plaintiffs to amend the complaint to add an additional cause of action for violation of the Magnuson-Moss Warranty Act (Act). Advance Stores moved to dismiss the third amended complaint. The trial court denied the motion in part and allowed the third amended complaint to go forward on new theories. Thereafter, Advance Stores filed this petition for a writ of prohibition, asserting that the circuit court ignored the mandate of the Supreme Court in McMahon I. The Supreme Court granted the writ and directed the circuit court to grant in full Advance Stores' motion to dismiss the third amended complaint, holding that in failing to present a claim under the Act in McMahon I, Plaintiffs were precluded from amending their complaint to assert the claim under the limited remand. View "State ex rel. Advance Stores Co. v. Circuit Court" on Justia Law

Plaintiffs sued Wells Fargo for fraudulent misrepresentation and promissory estoppel after Wells Fargo initiated foreclosure when plaintiffs stopped paying on their mortgage loan. The court held that plaintiffs have not stated a plausible claim for fraudulent misrepresentation regarding the modification of their home loan and therefore, the district court did not err in dismissing plaintiffs' claims under Rules 12(b)(6) and 9(b). The court also held that plaintiffs have not stated a plausible claim for promissory estoppel and the district court did not err in dismissing their claim. View "Freitas, et al v. Wells Fargo Home Mortgage, Inc." on Justia Law

Prime Motor Cars sold Seacoast RV, Inc. a car. The car had modifications that voided the manufacturer's warranty and caused mechanical problems that may not have been apparent when the car was sold because the "check engine" light was covered with opaque tape. Seacoast filed a complaint against Prime, alleging breach of contract, breach of warranty, fraud, violation of the Maine Unfair Trade Practices Act (UTPA), and punitive damages. The district court granted Prime's motion for judgment as a matter of law on the UTPA and punitive damages claims. The court then concluded that Prime's conduct constituted breach of contract and breach of warranty, but found against Seacoast on the fraud claim. The court rescinded the contract and ordered Prime to refund Seacoast and Seacoast to return the vehicle to Prime. The Supreme Court affirmed, holding that the district court did not err in its judgment. View "Seacoast RV, Inc. v. Sawdran, LLC" on Justia Law

Plaintiff, a resident of Arizona, sued Defendant, a foreign corporation that operates in Florida, after he contracted to buy an aircraft from Defendant but Defendant failed to deliver the aircraft. The U.S. district court applied Florida with respect to some of Plaintiff's claims and applied Arizona law to the remainder of the claims. The court also denied Defendant's motion for attorney's fees under the Florida Deceptive and Unfair Trade Practices Act (FDUTPA). On appeal, the Eleventh Circuit certified several questions to the Florida Supreme Court. The Court answered (1) because Plaintiff invoked FDUTPA by filing an action asserting a claim seeking recovery under FDUTPA in which Defendant ultimately prevailed, Defendant was entitled to attorney's fees under FDUPTA; (2) Defendant was entitled to fees for only the period of litigation until the federal district court held that FDUPTA did not apply to Plaintiff's claim; (3) Florida's offer of judgment statute does not apply to cases that seek both equitable relief and damages and in which Defendant has served an offer of judgment that seeks release of all claims; and (4) even if Florida's offer of judgment statute applied in this case, Defendant would not be entitled to attorney's fees under that section. View "Diamond Aircraft Indus., Inc. v. Horowitch" on Justia Law