Justia Contracts Opinion Summaries

In this appeal centering on the existence of a valid arbitration agreement the Court of Appeals affirmed the decision of the court of appeals reversing the judgment of the circuit court, holding that the circuit court erred in compelling arbitration of the question of whether the arbitration clause in the agreements at issue was valid.The arbitration clause in this case stemmed from transactions between lead paint tort plaintiffs who received structured settlements and affiliated factoring companies that specialize in purchasing structured settlement rights. Defendants filed motions to compel arbitration and stay the case, but Plaintiffs challenged the existence of a valid agreement to arbitrate. The trial court granted the motion to compel arbitration, finding that the arbitrator was to determine the issue of arbitrability. The Court of Special Appeals reversed. The Court of Appeals affirmed, holding that the circuit court erroneously compelled arbitration and that the issue of whether a valid arbitration agreement exists is an issue for the court to determine. View "Access Funding, LLC v. Linton" on Justia Law

The Supreme Judicial Court vacated the judgment of the business and consumer docket entered in favor of Plaintiffs vacating the Bureau of Parks and Lands' lease of public reserved land to NECEC Transmission LLC and Central Maine Power Co. (CMP) for construction of a high-capacity transmission line, holding that the Bureau acted within its constitutional and statutory authority in granting the lease.CMP appealed and Plaintiffs cross-appealed the trial court's decision not to address the substantive question of whether the Bureau had the constitutional authority to lease to the public reserved land. Plaintiffs later moved to dismiss the appeals on the ground that a citizen's initiative rendered the appeals moot. The Supreme Judicial Court denied the motion to dismiss and vacated the judgment below, holding (1) retroactive application of section 1 of the Initiative did not violate the Contract Clause of the United States Constitution, and therefore, the lease was not voided by the initiative; and (2) the record established that the Bureau acted within its constitutional and statutory authority in granting the lease. View "Black v. Bureau of Parks & Lands" on Justia Law

In this insurance coverage dispute the Supreme Court held that State Farm Fire and Casualty Company was not required to cover repair costs to masonry under either Minn. Stat. 65A.10, subd. 1 or the State Farm policy at issue.Before the Supreme Court was the interpretation and application of Minn. Stat. 65A.10, subd. 1, which generally requires replacement cost insurance to cover the cost of repairing damaged property in accordance with state or local authorities' minimum code. Specifically in question was whether State Farm must cover the cost of repairing cracks in masonry that preexisted a storm that damaged the property of St. Matthews. Because the cracks violated the City of St. Paul's building code, the City would not allow St. Matthews to replace the drywall without also repairing the masonry. The district court granted summary judgment to State Farm, determining that because the storm did not damage the masonry, which led to the code upgrade requirements, no coverage existed. The Supreme Court affirmed, holding that, while State Farm was responsible for providing replacement cost coverage to the damaged drywall, it was not required to cover repair costs to the masonry. View "St. Matthews Church of God & Christ v. State Farm Fire & Casualty Co." on Justia Law

TURSS provided background and credit screening services to property management professionals and landlords through its online platforms and undertook to build an online platform to sell customizable electronic lease forms. TURSS sent Helix a letter of intent that the platform would be completed in 2009. The companies entered into a five-year marketing agreement that required TURSS to provide the platform and Helix to provide the product. TURSS would receive 35% of the revenue generated from sales and Helix would receive 65%. The agreement was not exclusive. Helix provided electronic forms and supporting materials to TURSS but the platform was still not completed in 2015.Helix sued TURSS for“willful and intentional” breach of contract, fraud, negligent misrepresentation, and promissory estoppel. The court ultimately granted TURSS summary judgment. The appellate court and Illinois Supreme Court reversed, finding that Helix failed to present proof of its damages with reasonable certainty. Helix did not present evidence of revenues of a similar product or a similar business in a similar market. Where a plaintiff seeks lost profits for a new company, "without a track record of profit, attempting to sell a new and untested product to a new market,” the specter of impermissible speculation arises. View "Ivey v. Transunion Rental Screening Solutions Inc." on Justia Law

Walworth, a former stockholder, sued Mu Sigma, a privately held data analytics company, and Rajaram, the company’s founder, CEO, and board chairman, alleging that after reaping the benefits of Walworth’s $1.5 million investment and reputational capital, the defendants embarked on a fraudulent scheme to oust Walworth of its substantial ownership interest in the company.The Cook County circuit court dismissed the complaint, citing the stock repurchase agreement (SRA), which included anti-reliance and general release provisions. The appellate court reversed, holding that the anti-reliance language was ambiguous. The Illinois Supreme Court reinstated the dismissal, stating that “the broad and comprehensive release agreed to by [Walworth], a sophisticated party represented by experienced counsel, unambiguously encompasses” the unjust enrichment and breach of contract claims. The bargained-for anti-reliance provisions reflected the understanding that there may be undisclosed information but that Walworth was satisfied by the information provided. Walworth had direct access to Rajaram to negotiate the arm’s-length transaction at issue and Rajaram was not acting as a fiduciary for Walworth. A corporation owes no fiduciary duty to its shareholder and Delaware law does not impose “an affirmative fiduciary duty of disclosure for individual transactions.” View "Walworth Investments-LG, LLC v. Mu Sigma, Inc." on Justia Law

A Delaware superior court held that Plaintiffs-Appellees-Cross-Appellants, two doctors who started a laboratory testing enterprise known as Bako Diagnostics (“Bako”), breached certain restrictive covenants when they left Bako to form a new, competing laboratory enterprise. Despite fee-shifting provisions in certain of the contracts, the trial court declined to award attorneys’ fees. The Delaware Supreme Court agreed with the superior court’s determinations that the two doctors breached certain of the restrictive covenants. But because it appeared that the superior court may have misapplied the formula that both sides employed for calculating damages, the Court remanded the case for the trial court to clarify how it derived its damages award and for any needed revisions. Further, the Supreme Court disagreed that no attorneys’ fees were warranted under certain of the contracts. View "Bako Pathology LP v. Bakotic" on Justia Law

The Supreme Court reversed the judgment of the district court granting Defendant's motion to dismiss this lawsuit brought by Plaintiff under the Utah Sales Representative Commission Payment Act for allegedly failing to pay commissions it owed to her, holding that the Act's writing requirement is not a precondition for recovery.In her complaint, Plaintiff claimed that Defendant violated the Act by failing to pay commissions for sales that she made while working as a commissioned sales agent for the company. Defendant filed a motion to dismiss, arguing that because there was no signed writing there could be no recovery under the Act. The district court granted the motion. The Supreme Court reversed, holding (1) under the plain text of the Act, the writing requirement is not a prerequisite for a sales representative to sue a principal under the Act; and (2) therefore, the district court erred in granting Defendant's motion to dismiss. View "Williamson v. MGS By Design, Inc." on Justia Law

The 1985 “Manning Lease” granted the lessee rights to oil and gas on an approximately 100-acre tract of land in Bowling Green that is adjacent to a quarry. There is a long-expired one-year term, followed by a second term that conditions the maintenance of the leasehold interest on the production of oil or gas by the lessee. Bluegrass now owns the property. Believing that lessees were producing an insufficient quantity of oil to justify maintaining the lease, Bluegrass purported to terminate the lease and sought a declaration that the lease had terminated by its own terms while asserting several other related claims.The district court found that Bluegrass’s termination of the lease was improper and granted the lessees summary judgment. The Sixth Circuit reversed and remanded. There is a factual dispute regarding whether the lease terminated by its own terms. The trier of fact must determine if the lessee has produced oil in paying quantities after considering all the evidence. There is a material factual dispute about whether the lessee ceased producing oil for a period of time, and, if so, whether that period of time was unreasonable. View "Bluegrass Materials Co., LLC v. Freeman" on Justia Law

The First Circuit affirmed in part and reversed in part the judgment of the district court granting Evenflo Company Inc.'s motion to dismiss this amended class action complaint brought by forty-three plaintiffs from twenty-eight states alleging that certain representations made by Evenflo were false or misleading, holding that Plaintiffs' pleadings plausibly demonstrated their standing to seek monetary relief.Plaintiffs alleged that Evenflo made several misrepresentations about the safety and testing of its children's Big Kid car booster seat and that Plaintiffs purchased the seat relying on the misrepresentations and that, but for the misrepresentations, Plaintiffs would not have purchased the seat or would have paid less for it. Plaintiffs sought both monetary relief and declaratory and injunctive relief. The district court concluded that Plaintiffs lacked standing to bring their complaint and granted Evenflo's motion to dismiss. The Supreme Court remanded the case for further proceedings, holding (1) Plaintiffs had standing to pursue monetary relief; and (2) Plaintiffs lacked standing to seek declaratory and injunctive relief. View "In re Evenflo Company, Inc. v. Xavier" on Justia Law

The First Circuit affirmed the conclusion of the district court conclusion that the insurance policy issued by Motorists Commercial Mutual Insurance Company to the dealership that owned a motor vehicle that killed and injured several people did cover the accident at issue in this case, holding that the district court did not err.This dispute arose from an auction at which a motor vehicle being displayed for bidding suddenly accelerated into a group of auction attendees, killing five people and injuring several more. Motorists brought this action seeking a declaration that its policies did not provide coverage for the victims' claims against the auctioneer or its employee who was behind the wheel of the vehicle when it struck the victims. The district court granted summary judgment for Motorists. The First Circuit affirmed, holding that the policies at issue did not provide coverage for the accident. View "Motorists Commercial Mutual Insurance Co. v. Hartwell" on Justia Law