Justia Contracts Opinion Summaries

The Supreme Court affirmed the judgment of the court of appeals affirming the decision of the circuit court granting summary judgment in favor of Hiscox Insurance Company on Leicht Transfer & Storage Company's complaint seeking coverage for its losses under a commercial crime insurance policy issued to it by Hiscox, holding that Leicht's losses were not covered under the policy.Pallet Central Enterprises, Inc. forged delivery tickets and used them to bill Leicht for the sale and delivery of pallets that Pallet Central never sold or delivered. Leicht sought coverage for its losses under the policy issued to it by Hiscox. Hiscox denied coverage. Leicht sued for breach of contract, arguing that the forged delivery tickets comprised "directions to pay" within the meaning of the "forgery or alteration" insuring agreement of the Hiscox policy. The circuit court granted summary judgment for Hiscox, and the court of appeals affirmed. The Supreme Court affirmed, holding (1) the delivery tickets did not qualify as "written...directions to pay a sum certain in money"; and (2) the policy did not provide coverage for forged documents that were not themselves "directions to pay," but which were used as proxies for such documents. View "Leicht Transfer & Storage Co. v. Pallet Central Enterprises, Inc." on Justia Law

The First Circuit affirmed the judgment of the district court granting judgment to U.S. Bank Trust, N.A. in the amount of $226,458.28 on U.S. Bank's complaint against Julia Jones alleging breach of contract and breach of promissory note, holding that the district court did not err by admitting into evidence a computer printout, marked as Exhibit 8, that contained an account summary and a list of transactions related to the loan.On appeal, Jones argued that admitting Exhibit 8 violated the Federal Rules of Evidence. At issue was whether the records were "reliable enough to be admissible." The First Circuit answered in the affirmative, holding (1) the district court did not abuse its discretion in finding Exhibit 8 reliable enough to admit under Fed. R. Evid. 803(6); (2) the district court's admission of Exhibit 8 did not violate Fed. R. Evid. 901, 1001, or 1002; and (3) the district court did not err by awarding U.S. Bank approximately $23,000 in charges for escrow, title fees, and inspections that were not recoverable under the terms of the promissory note. View "U.S. Bank Trust, N.A. v. Jones" on Justia Law

The Supreme Court affirmed the district court's decision to exclude all evidence of Keystone Insurance Agency's alleged damage under Utah R. Civ. P. 26(d)(4) in Keystone's suit against Inside Insurance, the court's dismissal of all of Keystone's claims with the exception of Keystone's request for declaratory relief, and the court's dismissal of Inside's counterclaims, holding that the district court did not abuse its discretion.In its complaint, Keystone requested that the district court declare Keystone a member of Inside and sought to inspect certain records. Inside asserted several counterclaims. After the district court entered its judgment the Supreme Court affirmed, holding (1) Keystone failed to provide Inside with a viable computation of its claimed damages in compliance with Utah R. Civ. P. 26(a)(1)(C), and therefore, the district court properly excluded Keystone's damages evidence under rule 26(d)(4); (2) the district court properly denied Keystone's motion for reconsideration; and (3) the district court did not abuse its discretion by dismissing with prejudice Inside's expulsion counterclaim seeking expulsion of Keystone as a member of Inside pursuant to Utah R. Civ. P. 41(a)(2) and (c). View "Keystone Insurance Agency, LLC v. Inside Insurance, LLC" on Justia Law

The Supreme Court vacated the order of the superior court granting Defendants' motion to dismiss Plaintiff's complaint alleging breach of contract and seeking a declaration that Defendants had breached an agreement, holding that it cannot be said that Plaintiff failed to state a claim for which relief may be granted.Plaintiff, Chariho Regional School District, sued Defendants, the Rhode Island Department of Education, the Rhode Island Department of Administration, the Rhode Island Council on Elementary and Secondary Education, and the former Commissioner of Education alleging that the state Defendants had breached paragraph 1(d) of an agreement to convey certain property to Plaintiff "provided that Chariho continues to provide career and technical programs to students" (the CTC transfer agreement). A hearing justice granted the state Defendants' motion to dismiss. The Supreme Court vacated the order, holding (1) Plaintiff adequately pled a breach of paragraph 1(d) of the CTC transfer agreement; and (2) the hearing justice erred in finding that termination of the contract, as provided for in paragraph 3(a) of the CTC transfer agreement, represented Plaintiff's sole remedy for the state Defendants' breach. View "Chariho Regional School District v. State" on Justia Law

In this breach of contract and breach of warranty case the Supreme Court affirmed the judgment of the district court granting Shelly Besel's motion for summary judgment and dismissing Shelly from the litigation with prejudice, holding that Shelly was properly dismissed from the litigation.Appellants hired Leonard Besel to remodel their home. Prior to completing the project Leonard terminated the contract. Appellants brought this action naming Shelly as a defendant and alleging that Shelly was a partner of her husband's contracting business. Shelly moved to dismiss herself from the lawsuit, disavowing any partnership interest in her husband's business. The district court granted Shelly's motion. The Supreme Court affirmed, holding that no material issue of fact existed based on the evidence as to Shelly's status vis a vis the business, and therefore, the record supported the district court's ruling dismissing Shelly from the litigation. View "Norris v. Besel" on Justia Law

The Supreme Court affirmed in part and reversed in part the judgment of the circuit court in this action, holding that the circuit court properly denied a motion to dismiss based on the doctrine of forum non conveniens but erred in dismissing the case based on forum selection clauses.RMBS Recovery Holdings I, LLC and others (collectively, Funds) filed suit against HSBC Bank USA, National Association (HSBC) asserting that HSBC served as an indenture trustee of three trusts in which the Funds had invested and that the trusts were filled with defective mortgage loans. Based on HSBC's failure to act to have sponsors of the trusts repurchase the deficient loans or to file suit against the sponsors, the Funds claimed breach of contract, breach of fiduciary duty, and other causes of action. The circuit court denied HSBC's motion to dismiss for forum non conveniens but granted HSBC's motion to dismiss based upon forum selection clauses in confidentiality and indemnification agreements between the parties. The Supreme Court reversed in part, holding that HSBC's delay in asserting the forum selection clauses, while actively continuing litigation, resulted in a waiver of the right to rely upon that contractual provision. View "RMBS Recovery Holdings I, LLC v. HSBC Bank USA, N.A." on Justia Law

On October 30, 2013, Consuelo Prieto Mariscal was driving her minivan in Pasco, Washington, with her daughter. There were vehicles, including an orange, pickup truck and a van, on the right side of the road. As Prieto passed the orange pickup truck, she heard a noise, felt her van jump a little, and saw a boy, Brayan, lying on the ground. Realizing Brayan was seriously hurt, her daughter called 911. Brayan was taken to a nearby hospital. Prieto and her daughter both told the police they did not see how the accident happened. There were no other eyewitnesses, and though the officer only spoke to Prieto and her daughter, he noted in his report the "bicyclist pulled into the roadway [and] was stuck on the left side and fell to the ground. The passenger side front tire drove over the child['s] right front leg." Brayan gave a number of statements, the most detailed of which related his right shoelace got stuck in the spokes of his bicycle and his right leg was run over when he leaned over to untangle the lace. Monica Diaz Barriga Figueroa, Brayan's mother, retained counsel, and signed a blank personal injury protection (PIP) application form. The English-speaking legal assistant completed the form for the Spanish-speaking Diaz, pulling language of the accident from the police report. The significant difference between the PIP form and Brayan's testimony became a central issue at trial. Prieto's counsel stressed the differences between Diaz's and Brayan's testimony and the PIP form; Diaz's counsel stress the PIP form was based on accounts from people who did not see the accident. At trial, and over Diaz's counsel's objection, Prieto's counsel referenced the PIP form as a statement against interest. Diaz's counsel moved to exclude the PIP form as privileged. The issue before the Washington Supreme Court was whether the form could be considered work product entitled to protection from disclosure. The Court determined that in this instance, where the insured gained the status of insured by statute, rather than contract, the form at issue was privileged. The Court affirmed the Court of Appeals and remanded this matter back to the trial court for a new trial. View "Figueroa v. Mariscal" on Justia Law

Fifth Third Bank’s “Early Access” program is a short-term lending option for certain customers who hold eligible checking accounts. Fifth Third deposited Early Access loans straight into borrowers’ accounts, then paid itself back automatically, with a 10% “transaction fee,” after a direct deposit posted or 35 days elapsed, whichever came first. The contract governing the program disclosed the annual percentage rate (APR) as 120% in all cases. Plaintiffs obtained Early Access loans, which were paid back fewer than 30 days later. They contend that the 120% figure is false and misleading. Calculated using a more conventional method, in which the APR is tied to the length of the loan, plaintiffs assert that the APR was actually as high as 3650%. The district court rejected an Ohio law breach-of-contract claim, holding that the contract unambiguously disclosed the method for calculating APR despite admitting that the result “may be misleading.” The Sixth Circuit reversed. The contract was ambiguous because it provided different descriptions of “APR” that cannot be reconciled. The first was a definition, lifted verbatim from a federal regulation, that describes the APR as being “expressed as a yearly rate”; the second was the method used to calculate it, which is not based on any time period. The ambiguity raises a question of fact that should be resolved on remand. View "Laskaris v. Fifth Third Bank" on Justia Law

Plaintiffs David and Lisa McDaniel petitioned the Alabama Supreme Court for a writ of mandamus to direct the Shelby Circuit Court to vacate its order staying the proceedings against defendants Southern Craftsman Custom Homes, Inc. ("SCCH"); Jeffrey Rusert; Larry Curry, Sr.; SouthFirst Bancshares, Inc., d/b/a SouthFirst Bank ("SouthFirst"); Mari Gunnels; and Danny Keeney. At the time of this opinion, Rusert was awaiting the outcome of a federal criminal investigation against him. In 2017, the McDaniels contacted Rusert for the purpose of entering into an agreement with SCCH to build a house. According to the McDaniels, Rusert represented himself as the president of SCCH. At some point, Rusert recommended that the McDaniels speak with Gunnels, who worked for SouthFirst, to secure a loan to pay for the construction of the new house. In November 2017, with Gunnels's assistance, the McDaniels began the process of applying for a construction loan with SouthFirst. The loan closing occurred on January 26, 2018. The McDaniels executed, among other agreements, a written construction-loan agreement, a promissory note, and a construction-loan disbursement agreement. The McDaniels met with Rusert to discuss some concerns they had with the ongoing construction. During that meeting, Rusert provided the McDaniels with a credit application from a local building-supply company and asked them to execute it so that, he said, he could use the McDaniels' credit to purchase building materials and supplies. The McDaniels learned that the company refused to do business with SCCH, Rusert, and Curry because all three had purportedly failed to pay significant amounts owed the company. The McDaniels immediately contacted Gunnels and placed a "stop-payment" order on the most recent draw request from SCCH and Rusert. Thereafter, the McDaniels sued SCCH, Rusert, Curry, SouthFirst, Gunnels, and Keeney. In their complaint, the McDaniels sought damages for negligence, suppression, fraudulent misrepresentation, civil conspiracy, conversion, and the infliction of emotional distress. The McDaniels further alleged breach-of-contract claims against SouthFirst, SCCH, Rusert, and Curry, as well as a claim of breach of fiduciary duties against SouthFirst. Finally, the McDaniels sought a judgment against SouthFirst, Gunnels, and Keeney declaring the loan agreement and mortgage void. Rusert and SCCH moved to stay the civil proceedings against them pending the outcome of a federal criminal investigation against Rusert, which the trial court granted. The Alabama Supreme Court determined, however, the McDaniels established a clear legal right to relief from the trial court's order. Accordingly, the Supreme Court granted the petition for a writ of mandamus and directed the trial court to vacate its order staying the underlying case. View "Ex parte David and Lisa McDaniel." on Justia Law

Defendant Nationwide Mutual Fire Insurance Company ("Nationwide") appealed a judgment entered in favor of plaintiff The David Group, Inc. ("TDG"), which held TDG was entitled to coverage and indemnification under a commercial general- liability ("CGL") insurance policy issued by Nationwide. Under the terms of that CGL policy, Nationwide agreed to "pay those sums that the insured becomes legally obligated to pay as damages because of 'bodily injury' or 'property damage' to which this insurance applies." According to the policy, its coverage applied to "bodily injury" and "property damage" only if "[t]he 'bodily injury' or 'property damage' is caused by an 'occurrence.'" In October 2006, while TDG's CGL policy with Nationwide was in effect, Saurin and Valerie Shah purchased a newly built house from TDG. After they moved in, the Shahs began experiencing problems with their new house. Despite TDG's efforts at correcting the problems, however, in February 2008, the Shahs sued TDG. Although Nationwide initially defended TDG against the Shahs' action, Nationwide withdrew its defense after conducting its own investigation into the Shahs' allegations. It concluded that it had no duty either to defend or to indemnify TDG because, according to Nationwide, the damage the Shahs complained of did not constitute an "occurrence" so as to trigger coverage under the CGL policy. The Alabama Supreme Court concluded the trial court erred in finding that TDG was entitled to coverage and indemnification under its CGL policy with Nationwide. Thus, the Court reversed the trial court's judgment and remanded the case for further proceedings. View "Nationwide Mutual Fire Insurance Company v. The David Group, Inc." on Justia Law