Justia Contracts Opinion Summaries

The Supreme Court affirmed in part and vacated in part the superior court's denial of Defendants' motion for a new trial after a jury found in favor of Plaintiff on his complaint alleging conversion and breach of contract, holding that Defendants waived their economic loss doctrine argument and that the trial justice erred in awarding attorneys' fees to Plaintiff.Plaintiffs entered into a lease with Defendants to rent commercial property owned by Defendants. Plaintiff was unable to occupy the commercial premises before the lease period could begin, but Defendants refused to return the security deposit. Plaintiff filed this action, alleging and breach of contract and that the refusal to return the security deposit constituted a conversion of his property. A jury found that Defendants had converted Plaintiff's security deposit to their own use. Judgment entered awarding Plaintiff compensatory damages plus attorneys' fees. Plaintiffs appealed, arguing that the economic loss doctrine barred recovery under the conversion claim and that the trial justice erred in awarding attorneys' fees pursuant to R.I. Gen. Laws 9-1-45. The Supreme Court held (1) Defendants waived the economic loss doctrine argument and may not now revive the argument on appeal; and (2) section 9-1-45 cannot be the basis for an attorneys' fees award in this case. View "Heneault v. Lantini" on Justia Law

The Supreme Court held that International Business Machines, Corp. (IBM) was entitled to post-judgment interest on its $49.5 million damages award as entered by the trial court and affirmed by this Court in IBM I running from the date of the judgment on remand and not from the date of the original judgment in 2012.This case arose out of a contract entered into between the State, acting on behalf of the Family and Social Services Administration, and IBM to improve Indiana's welfare eligibility system. In IBM I, the Supreme Court determined that IBM materially breached the contract and remanded the matter to the trial court to determine damages and offsets. On remand, the trial court determined that damages to the State from the breach totaled $128 million and IBM was entitled to offsets in the amount of $49.5. Thus, IBM was ordered to pay the State $78.2 million, after offsets. On appeal, IBM argued, among other things, that it was entitled to post-judgment interest on the fees upheld by the Court in IBM I. The court of appeals agreed. The Supreme Court held that the post-judgment interest due to IBM ran from the judgment on remand and summarily affirmed the court of appeals on all other issues. View "International Business Machines Corp. v. State ex rel. Indiana Family & Social Services Administration" on Justia Law

JRE filed suit against defendants in an action stemming from a dispute concerning a television production based on the life of the Mexican-American celebrity Jenni Rivera. JRE filed suit against Rivera's former manager, the program's producers, and the program's broadcaster. JRE alleged that the manager breached a nondisclosure agreement by disclosing information to the producers and the broadcaster.The Court of Appeal affirmed the trial court's order denying the producers' special motion to strike under Code of Civil Procedure section 425.16, holding that JRE satisfied its burden to demonstrate a prima facie case, with reasonable inferences from admissible evidence, that the producers had knowledge of the nondisclosure agreement before taking actions substantially certain to induce the manager to breach the agreement. However, the court held that the First Amendment protected the broadcaster's use and broadcast of the information in the series, and the court reversed the trial court's order denying the broadcaster's special motion to strike. In this case, although First Amendment protection for newsgathering or broadcasting does not extend to defendants who commit a crime or an independent tort in gathering the information, it was undisputed that the broadcaster did not know of the nondisclosure agreement at the time it contracted with the producers to broadcast the series, and JRE did not show that the broadcaster engaged in sufficiently wrongful or unlawful conduct after it learned of the nondisclosure agreement to preclude First Amendment protection. View "Jenni Rivera Enterprises, LLC v. Latin World Entertainment Holdings, Inc." on Justia Law

The Supreme Court affirmed the judgment of the district court granting Plaintiff's motion for judgment on the pleadings, holding that the district court did not err in granting Plaintiff's motion for judgment on the pleadings because Defendants breached an agreement between the parties.Plaintiff sued Defendants for breaching an agreement between the parties to purchase a 2974 pressurized Cessna Skymaster 337 from Plaintiff for $90,000. When Defendants informed Plaintiff they would not be making the purchase due to their inability to obtain insurance, Plaintiff brought this action. The district court found Defendants liable for breaching the agreement and granted Plaintiff's motion for judgment on the pleadings. The Supreme Court affirmed, holding that the district court did not err in granting Plaintiff's motion for judgment on the pleadings, denying Plaintiff's motion in limine, sanctioning Plaintiff, and denying Plaintiff's motion for pre-judgment interest. View "Kalispell Aircraft Co. v. Patterson" on Justia Law

The Supreme Court affirmed the judgment of the circuit court overruling Seneca Specialty Insurance Company's motions to intervene and to set aside judgment in a lawsuit filed by Dr. Neil Desai and Heta Desai against Garcia Empire, LLC after the Desais and Garcia Empire entered into a contract pursuant to Mo. Rev. Stat. 537.065, holding that the requirements of the amended statute did not apply to the contract entered into by the Desais and Garcia Empire.In 2017, the legislature repealed the statute and enacted an amended section 537.065, which continued to permit the same contracts as provided in the 2016 statute but included additional requirements that an insurer be provided written notice and the opportunity to intervene. The amendment became effective after the case was tried but prior to the circuit court's entry of judgment. Seneca argued that it was denied additional rights provided for in the amendment and, as a result, the circuit court erred in entering judgment. The Supreme Court affirmed, holding that because the Desais and Garcia Empire entered into the contract prior to the effective date of the amended statute, the circuit court did not err in overruling Seneca's motions to intervene and to set aside judgment. View "Desai v. Seneca Specialty Insurance Co." on Justia Law

In these consolidated cases involving alleged breaches of fiduciary duties the Supreme Court answered questions certified to it by the United States Bankruptcy Court for the District of Arizona by applying common law agency principles to questions involving fiduciary duties between members and managers of a limited liability company (LLC).The Court answered the three certified questions as follows: (1) a manager of an Arizona LLC owes common law fiduciary duties to the company; (2) a member of an Arizona LLC owes common law fiduciary duties to the company, provided that the member is an agent of the LLC; and (3) an Arizona LLC's operating agreement may lawfully limit or eliminate those fiduciary duties, but the agreement may not eliminate the implied contractual duty of good faith and fair dealing. View "Sky Harbor Hotel Properties, LLC v. Patel Properties, LLC" on Justia Law

Porter custom built a 40-foot Formula yacht for German businessman Schwaiger. The yacht and its lift cost approximately $1 million. Porter, as the manufacturer, was not a party to the purchase contract. The parties were German dealer Poker-Run-Boats and Schwaiger’s company, SelectSun. The contract required the boat to be CE certified: authorized for operation in the European Union. The order placed by IN, Porter’s domestic dealer, called for a switchable exhaust system that would allow the operator to divert exhaust either above or below the water line. EU regulations require exhaust expulsion below the water line. Porter caught this conflict and explained that the boat could not be both equipped with the switchable exhaust system and CE certified. Nonetheless, IN authorized Porter to manufacture the boat with the switchable system. Apparently Schwaiger knew nothing of that decision and believed the yacht would come CE certified. Schwaiger took delivery of the yacht in Germany and used the boat throughout much of the 2013 season, then became disappointed with the yacht, complaining to Poker-Run-Boats of problems with the engines, steering, exterior coating, and furnishings. Rather than seek repairs, Schwaiger returned the yacht to PokerRun-Boats for sale then sued Porter and IN. Both IN and Poker-Run-Boats ceased operations. The Seventh Circuit affirmed the rejection of all claims. SelectSun focused its evidence on contract formation and apparent agency authority but, with respect to damages, only established the cost of the yacht, offering no evidence of the current value of the yacht, the costs of repairs or the cost to render the yacht CE certified. SelectSune failed to prove its damages with reasonable certainty. View "SelectSun GmbH v. Porter, Inc." on Justia Law

This case centered on a property lease in Gilford, New Hampshire that included certain preemptive purchase rights (the Agreement). Plaintiffs Evan and Kelly Greenwald sought a declaration on the interpretation of the Agreement, whether it had been breached, and who was liable. On cross-motions for summary judgment, the Superior Court ruled in favor of defendants Barbara Keating, Jill Keating, Ellen Mulligan, and Barry and Chrysoula Uicker. The New Hampshire Supreme Court determined that central to the trial court’s decision was the interpretation of the Agreement - specifically paragraphs 18B and 18C. In the trial court’s view, the Agreement unambiguously required that Richard and Jill Keating intend to list the Mink Island property for sale, not merely intend to sell it, before plaintiffs’ rights under paragraph 18B were triggered. The court also concluded that paragraph 18B was unenforceable because it did not include an essential term: the purchase price. As for the right of first refusal under paragraph 18C, the trial court concluded that this provision was triggered only if the Keatings accepted an offer to purchase made by a third party after the Keatings had listed the property for sale. Thus, the trial court ruled that no breach occurred because the triggering condition - listing the property for sale - was never met. The Supreme Court concluded that because the meaning of the Agreement was ambiguous concerning whether listing the property was intended to be ministerial or substantive, the trial court erred in resolving this issue on summary judgment. The Court agreed with plaintiffs that the trial court erred in summarily concluding that Barbara could not be held liable under the Agreement because she held no ownership interest in the Mink Island property and could not otherwise be chargeable as an agent of Jill. The matter was reversed and remanded for further proceedings. View "Greenwald et al. v. Keating et al." on Justia Law

A condominium association, Dakota Station II Condominium, filed two claims with its insurer, Owners Insurance Company, for weather damage. The parties couldn’t agree on the money owed, so Dakota invoked the appraisal provision of its insurance policy. The parties each selected an appraiser, putting the rest of the provision’s terms into motion. Ultimately, the appraisers submitted conflicting value estimates to an umpire, and the umpire issued a final award, accepting some estimates from each appraiser. Dakota’s appraiser signed onto the award, and Owners paid Dakota. Owners later moved to vacate the award, arguing that Dakota’s appraiser was not “impartial” as required by the insurance policy’s appraisal provision and that she failed to disclose material facts. The trial court disagreed and “dismissed” the motion to vacate. A division of the court of appeals affirmed. In its review, the Colorado Supreme Court interpreted the policy’s impartiality requirement and determined whether a contingent-cap fee agreement between Dakota and its appraiser rendered the appraiser partial as a matter of law. The Court concluded the plain language of the policy required appraisers to be unbiased, disinterested, and unswayed by personal interest, and the contingent-cap fee agreement didn’t render Dakota’s appraiser partial as a matter of law. Accordingly, the Court affirmed the judgment of the court of appeals with respect to the contingent-cap fee agreement, reversed with respect to the impartiality requirement, and remanded for further proceedings. View "Owners Ins. v. Dakota Station II Condo. Ass'n" on Justia Law

The United States District Court for the District of Colorado certified a question of law to the Colorado Supreme Court. The question centered on proof of equitable estoppel. In 2017, a group of current and former exotic dancers sued the owners of clubs where they performed and the club owners’ corporate parent companies alleging the defendants acted in concert to wrongfully deprive the dancers of basic protections provided by law to employees. The plaintiffs contended they were misclassified as nonemployee “independent contractors” or “lessees” pursuant to “Entertainment Lease” agreements that identified the club-owner defendants as “landlords” rather than employers. According to the plaintiffs’ pleadings, the club-owner and corporate-parent defendants were jointly and severally liable for denying the dancers earned minimum wages and overtime pay, confiscating or otherwise misallocating their gratuities, charging them fees to work, and subjecting them to onerous fines. The club-owner defendants have successfully compelled arbitration of the plaintiffs’ claims based on the arbitration clause included in the agreements the dancers signed with the club owners. The corporate-parent defendants sought to do the same, but because they were not parties to the agreements or to any other written contract with the dancers, they had to find a different hook to compel the dancers into arbitration: that the dancers should be equitably estopped from litigating their claims against one set of defendants because they were in compelled arbitration of the same claims against the other set of defendants. The Colorado Supreme Court held Colorado’s law of equitable estoppel applied in the same manner when a dispute involves an arbitration agreement as it did in other contexts. Thus, a nonsignatory to an arbitration agreement could only assert equitable estoppel against a signatory in an effort to compel arbitration if the nonsignatory can demonstrate each of the elements of equitable estoppel, including detrimental reliance. View "Santich v. VCG Holding Corp." on Justia Law