Justia Contracts Opinion Summaries

The Eighth Circuit affirmed the district court's denial of plaintiff's motion for leave to amend and granted summary judgment dismissing plaintiff's sole claim remaining on remand -- that American Century breached the implied covenant of good faith and fair dealing by taking discretionary action to retaliate in violation of public policy. The court held that the Supreme Court of Missouri's decision in Bishop & Assocs., LLC, v. Ameren Corp., 520 S.W.3d 463 (Mo. banc. 2017), limits plaintiff's claim for breach of American Century's implied covenant of good faith and fair dealing to the "reasonable expectation" ground that was dismissed with prejudice in Kmak I. The court also held that the district court did not abuse its discretion in determining that plaintiff failed to show good cause to amend. View "Kmak v. American Century Co." on Justia Law

Under the circumstances of this case, the mere commencement of an action seeking “rescission and/or reformation” of a contract does not constitute an anticipatory breach of such agreement.Plaintiff agreed to purchase certain property from Defendants. The contract was subsequently amended. Plaintiff later commenced this action seeking specific performance absent the amendments on the ground that the amendments were executed based on Defendants’ alleged misrepresentations. Defendants asserted various counterclaims. Plaintiffs’ causes of action were eventually dismissed. Supreme Court granted summary judgment for Defendants on their counterclaims, concluding that the contract had “expired by its terms” and that Plaintiff” materially breached the contract.” The Appellate Division affirmed, concluding that a rescission action unequivocally evinces a plaintiff’s intent to disavow its contractual obligations, and therefore, the commencement of such an action before the date of performance constitutes an anticipatory breach. The Court of Appeals reversed, holding that the commencement of this action did not reflect a repudiation of the contract. View "Princes Point LLC v. Muss Development LLC" on Justia Law

Joan Hallin, John Hallin and Susan Bradford (collectively Hallin and Bradford) appeal from a judgment in favor of Inland Oil & Gas Corporation. In 2007, Hallin and Bradford each leased to Inland mineral interests they owned in 160 acres of land in Mountrail County. The leases provided Hallin and Bradford leased to Inland "all that certain tract of land situated in Mountrail County." Hallin and Bradford, along with members of their extended family, owned a fraction of the minerals in the entire 160 acres. On the basis of irregularities in the chain of title, it was unclear whether Hallin and Bradford collectively owned sixty net mineral acres or eighty net mineral acres when the parties executed the leases. Hallin and Bradford believed they owned sixty net mineral acres and their relatives owned sixty acres. When Hallin and Bradford executed the leases, they also received payment drafts for a rental bonus showing they each leased thirty acres to Inland. The leases provide royalty compensation based upon the number of net mineral acres. The North Dakota Supreme Court decided Hallin and Bradford collectively owned eighty net mineral acres and their relatives owned forty net mineral acres. Inland and Hallin and Bradford disagreed whether the leases covered all of Hallin and Bradford's mineral interests. Hallin and Bradford sued Inland, arguing they leased sixty acres and the remaining twenty acres were not leased. Inland argued Hallin and Bradford leased eighty acres because the leases cover all of their mineral interests. The district court granted summary judgment to Inland, concluding the leases were unambiguous and that "as a matter of law, the Hallins and Bradford leased to Inland whatever interest they had in the subject property at the time the leases were executed." Finding no reversible error in that judgment, the North Dakota Supreme Court affirmed. View "Hallin v. Inland Oil & Gas Corporation" on Justia Law

HCG Platinum, LLC ("HCG") and Preferred Product Placement Corporation (“PPPC”) entered into a Marketing Agreement under which PPPC agreed to place HCG products into specified retailers in exchange for a percentage of the proceeds. Shortly thereafter, HCG filed the underlying breach-of-contract action against PPPC, seeking compensatory damages for PPPC’s alleged breaches and a declaratory judgment that HCG properly terminated the Marketing Agreement on account of these breaches. PPPC counterclaimed for breach of contract and asserted third-party contract claims against individuals and entities associated with HCG. Prior to trial, HCG moved to preclude PPPC from presenting evidence of damages, asserting that PPPC’s initial (and never supplemented) disclosures provided an insufficient description and computation of PPPC’s damages theory. Finding PPPC’s initial disclosures insufficient and its request to compel discovery untimely, the district court excluded the damages evidence from PPPC’s disclosures. Exclusion of that evidence, in turn, necessarily barred PPPC from pursuing its counterclaims, and the district court subsequently entered judgment against PPPC on that basis. PPPC appealed, arguing that the district court abused its discretion by imposing a discovery sanction that carried the force of dismissal, despite the fact that its discovery shortcomings resulted in only minimal and curable prejudice to HCG. After review, the Tenth Circuit reversed the district court’s judgment in favor of HCG on PPPC’s counterclaims ​and remanded for the district court to reconsider the exclusion of PPPC’s damages evidence under an analysis that considers, among other things, the availability of lesser sanctions. View "HCG Platinum v. Right Way Nutrition" on Justia Law

The Supreme Court reversed the circuit court’s grant of summary judgment in favor of Respondents in this action in which Respondents added Petitioner as a defendant. Respondents settled a lawsuit against certain companies (the Brozik companies) for failing to pay the purchase price under an agreement to buy the assets of Respondents’ business. The circuit court later awarded Respondents $47,184 to be paid by the Brozik companies based upon the cessation of payments pursuant to the settlement. This judgment became a lien. The assets of one of the Brozik companies was then sold to Petitioner, and Respondents amended their complaint to add Petitioner as a defendant. In reversing the circuit court's judgment, the Supreme Court held that Respondents did not satisfy their burden of showing the absence of any genuine issues of material fact, and therefore, summary judgment should not have been granted. View "Kourt Security Partners, LLC v. Judy's Locksmiths, Inc." on Justia Law

The Supreme Court affirmed in part and reversed in part the district court’s grant of summary judgment in favor of Peak Powder River Resources, LLC (Peak) and against Bear Peak Resources, LLC (Bear) in this action alleging breach of contract, among other claims.Bear and Peak had agreed to work together in acquiring mineral interests for development, but Peak later obtained some mineral interests without compensating Bear and terminated the parties’ agreement. Bear filed suit. The district court determined that Peak was entitled to summary judgment on all of Bear’s claims. The Supreme Court reversed in part, holding that the district court (1) properly granted Peak’s motion for summary judgment on Bear’s breach of the implied covenant, breach of fiduciary duty, and accounting claims; (2) properly concluded that the parties’ contract was unambiguous; and (3) did not err in determining that Peak was entitled to summary judgment on several of the individual breach of contract claims, but genuine issues of material fact existed on the remaining claims. View "Bear Peak Resources, LLC v. Peak Powder River Resources, LLC" on Justia Law

Plaintiff filed suit against defendants, alleging breach of contract, defamation, and tortious interference with a prospective economic advantage. The district court granted summary judgment for defendants. In this case, plaintiff believed that she had voluntarily withdrawn from her postgraduate clinical research fellowship, but defendants reported to plaintiff's employer, the US Air Force, that she had been terminated for cause. The DC Circuit held that, because there was a genuine factual dispute as to whether defendants gave plaintiff's employer false information, the district court incorrectly granted summary judgment on the defamation claims. Therefore, the court reversed and remanded as to those claims. The court affirmed the district court's grant of summary judgment on the remaining claims. View "Burns v. Levy" on Justia Law

In 2009, Bancorp, which provides checking and savings accounts to individuals, purchased a bankers’ professional liability insurance policy from Federal. The policy stated: [Federal] shall pay, on behalf of an Insured, Loss on account of any Claim first made against such Insured during the Policy Period … for a Wrongful Act committed by an Insured or any person for whose acts the Insured is legally liable while performing Professional Services, including failure to perform Professional Services" but that Federal “shall not be liable for Loss on account of any Claim … based upon, arising from, or in consequence of any fees or charges” (Exclusion 3(n)). The 2010 Swift Complaint sought damages for Bancorp's "unfair and unconscionable assessment and collection of excessive overdraft fees.” Swift sought to represent a class of all U.S. BancorpSouth customers who "incurred an overdraft fee as a result of BancorpSouth’s practice of re-sequencing debit card transactions from highest to lowest.” In 2016, Bancorp agreed to pay $24 million to resolve all the claims, $8.4 million of which was for attorney’s fees, plus $500,000 in class administrative costs. Federal denied coverage. The Seventh Circuit agreed that Exclusion 3(n) excluded from coverage losses arising from fees and affirmed the dismissal of breach of contract claims and a bad faith claim. View "BancorpSouth Inc. v. Federal Insurance Co." on Justia Law

After remand, the trial court ruled that H.A.S. Electrical Contractors, Inc. (HAS) failed to meet its burden of proving purposeful discrimination. Hemphill Construction Company was the general contractor on a project in Waveland, Mississippi, to rebuild a state park after Hurricane Katrina. Hemphill entered a subcontract with HAS (one of many entered into between these companies - both before and after the event complained of) to perform the electrical work. According to HAS, Hemphill did not pay HAS all it was owed under the subcontract. HAS sued Hemphill for breach of contract, quantum meruit, and conversion. After a three-day trial, the jury found in favor of Hemphill on both HAS’s claims and Hemphill’s counterclaim. However, the jury declined to award Hemphill monetary damages. The subcontract entitled the “prevailing party” to reasonable attorney’s fees and expenses. HAS filed a motion for new trial or, in the alternative, a motion for judgment notwithstanding the verdict (JNOV), arguing the trial court erred: (1) in allowing Hemphill to use two of its peremptory strikes to exclude two African Americans from the jury, arguing neither pretext nor purposeful discrimination; and (2) in not finding the unilateral attorney’s-fees provision of the contract to be unconscionable. The trial court denied HAS’s motion for new trial and alternative motion for JNOV. In its briefs appealing the trial court ruling to the Mississippi Supreme Court, HAS challenged the attorney’s-fees award and argued the trial court mishandled the Batson hearing when HAS challenged Hemphill’s use of peremptory strikes on the African-American jurors. The Supreme Court affirmed, finding HAS failed to prove: (1) purposeful discrimination in the jury selection process; (2) that the trial court’s ruling was clearly erroneous; or (3) that the trial court’s ruling was against the overwhelming weight of the evidence. Accordingly, the Court affirmed the jury’s verdict, the trial court’s denial of HAS’s motion for new trial, and the trial court’s post-judgment award of attorney’s fees to Hemphill. View "H.A.S. Electrical Contractors, Inc. v. Hemphill Construction Company, Inc." on Justia Law

Wiseman filed suit seeking to recover "carrying charges" it paid Southern on the theory that those charges were not permitted by the Alcoholic Beverage Control Act. The trial court ruled that the California Department of Alcoholic Beverage Control (Department) has exclusive jurisdiction over Wiseman's claims because its allegations directly implicate the sale of alcohol. The Court of Appeal held that, although the Department does have exclusive jurisdiction to issue, deny, suspend and revoke alcoholic beverage licenses according to terms of the ABC Act and regulations adopted pursuant to it, the consequences of committing a violation of the ABC Act by imposing charges of the type collected by Southern from Wiseman in this case were not limited to those which the Department may impose on its licensees and did not bar the contract, unfair competition and declaratory relief claims alleged in Wiseman's complaint. Accordingly, the court reversed the trial court's order sustaining Southern's demurrer and remanded for further proceedings. View "Wiseman Park v. Southern Glazer's Wine and Spirits" on Justia Law