Justia Contracts Opinion Summaries

Norfolk Redevelopment and Housing Authority (NRHA) filed a complaint against the St. Joe Company and Advantis Real Estate Services Company alleging unjust enrichment and seeking imposition of a constructive trust and recovery of funds supplied by NRHA to its agent, Advantis, for the payment of contractors who had performed services for NRHA. St. Joe held a perfected secured interest in Advantis's operating account and exercised its rights as a secured creditor over that account to have funds from Advantis's account, including those entrusted to Advantis as NRHA's agent, transferred to a St. Joe account. The circuit court entered summary judgment in favor of NRHA. The Supreme Court affirmed, holding that the imposition of a constructive was was proper and necessary to prevent a failure of justice and unjust enrichment.

First American Title Insurance Company (FATIC) provided title insurance for a mortgage refinancing to SunTrust Mortgage through FATIC's title agent, First Alliance. First Alliance subsequently obtained a $100,000 surety bond pursuant to the Virginia Consumer Real Estate Settlement Protection Act (CRESPA) from Western Surety (Western). After the property owner defaulted under the original mortgages, SunTrust lost $734,296. FATIC paid the full amount of this loss then made a formal demand upon Western for $100,000. Western refused to pay FATIC the amount of the surety bond. FATIC sued Western and First Alliance for breach of contract. The district court entered judgment in FATIC's favor for $100,000. The Supreme Court held (1) CRESPA does not recognize a private cause of action that may be asserted against a surety and the surety bond issued pursuant to former Va. Code Ann. 6.1-2.21(D)(3); (2) Virginia law nonetheless permits a cause of action against a surety and the surety bond executed pursuant to CRESPA by the assertion of a common law claim; and (3) a title insurance company may have standing, not in its own right, but as a subrogee of its insured, to maintain a cause of action against a surety and the surety bond.

The Davises failed to pay the real estate tax for their property, resulting in a statutory tax. The Davises then filed a petition for bankruptcy, which was granted. Subsequently, the sheriff sold the tax lien. After the statutory time period that the Davises could redeem the property had passed and the property remained unredeemed, the tax lien purchaser received a tax deed conveying the Davises' property. The trial court set aside the tax deed, concluding that the tax lien sale should not have been held because the Davises had been in bankruptcy and because the sheriff did not give sufficient notice to the Davises of the tax delinquency, lien, and sale. The Supreme Court reversed, holding that the trial court erred (1) in considering issues relating to the sufficiency of the sheriff's service of the notices; (2) in considering the sheriff's pre-sale notices to the Davises, as only the post-sale notice to redeem is relevant in a lawsuit to set aside a tax deed; and (3) by granting judgment without making sufficient findings of fact and conclusions of law as to the effect the Davises' bankruptcy had on the tax lien. Remanded.

Plaintiff rented a car, drove 64 miles in one day, refilled the fuel tank, and returned the car to the same location from which he rented the car. In addition to rental and other fees that he does not dispute, he was charged a $13.99 fuel service fee that he challenged by filing a putative class action, claiming breach of contract, fraud, and unjust enrichment. Defendant claimed that, because plaintiff drove fewer than 75 miles during the rental period, to avoid the charge he was required to return the car with a full fuel tank and to submit a receipt. The district court dismissed, finding that the contract was not ambiguous. The Sixth Circuit affirmed, citing the voluntary payment doctrine.

Defendant sells brokerage and investment products and services, typically to registered broker-dealers and investment advisers that trade securities for clients. One of its services, NetExchange Pro, an interface for research and managing brokerage accounts via the Internet, can be used for remote access to market dynamics and customer accounts. A firm may make its clients' personal information, including social security numbers and taxpayer identification numbers, accessible to end-users in NetExchange Pro. Some of defendant's employees also have access to this information. Plaintiff, a brokerage customer with NPC, which made its customer account information accessible in NetExchange Pro, received notice of the company's policy and filed a putative class action, alleging breach of contract, breach of implied contract, negligent breach of contractual duties, and violations of Massachusetts consumer protection laws. The district court dismissed. The First Circuit affirmed. Despite "dire forebodings" about access to personal information, plaintiff failed to state any contractual claim for relief and lacks constitutional standing to assert a violation of any arguably applicable consumer protection law.

Husband and wife Emmett and Debra Jackson appealed the grant of summary judgment in favor of Wells Fargo Bank, N.A. in their action against the bank and trustee. The Jacksons challenged a foreclosure sale of their property. The Jacksons refinanced an existing home loan; in so doing, they gave a mortgage on the property which was subsequently assigned to Wells Fargo. Although the mortgage was, in turn, assigned to the trustee, the bank continued to function as the "servicer" of the loan. By 2007, the Jacksons were in arrears on their mortgage payments. While the Jacksons and the bank were engaged in negotiations for forbearance, the Jacksons did not make certain scheduled payments. During the negotiations, a debt-collection representative of the trustee sent the Jacksons a "NOTICE OF ACCELERATION OF PROMISSORY NOTE AND MORTGAGE." The house was put up for sale, and a foreclosure deed was issued to a third party. The Jacksons then sued the bank, the trustee, and the purchaser of the property alleging negligent or wanton foreclosure and breach of contract. The bank and trustee moved for summary judgment, contending that the Jacksons lacked any basis from which to contest the foreclosure sale. Upon review, the Supreme Court found that the Jacksons presented no basis on which to reverse the summary judgment as to their claim of negligent or wanton foreclosure, however, the Court agreed that the acceleration letter was fundamentally flawed. The Court reversed the grant of summary judgment on the breach of contract claim, and remanded the case for further proceedings.

Appellant was physically injured as a result of an accident caused by an underinsured motorist. Prior to the accident, Appellant purchased a Dairyland Insurance Policy through his insurance agent, Jonathan Schrack. Although Appellant requested full coverage, the policy did not include underinsured motorist coverage. When the other driver's insurance did not fully cover Appellant's damages, Appellant sued Dairyland and Schrack (Defendants), raising numerous theories as to why he should recover under the Dairyland policy. The district court granted Defendants' motions for summary judgment. The Supreme Court affirmed, holding, inter alia, (1) Wyoming's uninsured motorist statutes unambiguously do not require insurers to provide underinsured motorist liability coverage; (2) Appellant's failure to read the policy was available as a defense to Defendants as to Appellant's negligence and contract claims against them and barred application of the doctrine of promissory estoppel; and (3) the doctrine of reasonable expectations was not available to alter the unambiguous terms of the policy.

In 2006, plaintiffs contracted with defendant to purchase a condominium for $395,900. They made cash deposits of $11,877 and executed a note for $19,795. When notified of a closing date in 2009, plaintiffs' counsel sent defendant a letter rescinding the agreement and requesting return of the deposits. Defendant declined. Plaintiffs' complaint alleged violation of the Interstate Land Sales Full Disclosure Act, 15 U.S.C. 1701, for failing to provide a printed property report, and failure to include a provision notifying plaintiffs that if defendant failed to furnish a property report before execution of the purchase agreement, they had the right to revoke the purchase agreement within two years of its signing. They also asserted a claim under the Michigan Condominium Act, Mich. Comp. Laws 559.184. The district court held that the claim for rescission was untimely, stating that a purchaser must notify the seller of rescission within two years after the signing, but a has an additional third year to bring suit if the seller refused to honor the rescission. The Sixth Circuit affirmed that the claim for automatic rescission was untimely, but reversed dismissal of the state law claim and remanded. Equitable rescission may be available under 15 U.S.C. 1709.

Max and Glenna Overbey recovered judgments against Chad Franklin National Auto Sales North, LLC (National) and Chad Franklin (Franklin) for fraudulent representations in violation of the Missouri Merchandising Practices Act made in connection with National's sale of a vehicle to the Overbeys. Franklin appealed, and the Overbeys appealed the trial court's reduction of the punitive damage verdict as required by statute. The Supreme Court affirmed, holding (1) the award against Franklin was fully supported by the evidence; and (2) the limit of punitive damages did not violate the Overbeys' constitutional rights or the separation of powers doctrine.

This case stemmed from the judicial sale of a condominium owned by Petitioner and conducted by two court-appointed trustees that were employed by a law firm (collectively, Respondents). Following the sale, Petitioner filed a complaint, alleging breach of fiduciary duty involving actual fraud and breach of fiduciary duty involving constructive fraud by the trustees and alleging vicarious liability by the law firm. The trial judge granted Respondents' motion to dismiss, concluding that Respondents were entitled to qualified judicial immunity for their actions in connection with the sale. The court of special appeals (1) reversed with regard to Petitioner's allegations of actual fraud, and (2) affirmed with regard to the other causes of action on grounds of qualified judicial immunity. The Supreme Court affirmed in part and reversed in part, holding that Respondents were not entitled to absolute judicial immunity, and the concept of qualified public official immunity was inapplicable to the circumstances of this case.