Justia Contracts Opinion Summaries

Prather, age 31, tore his left Achilles tendon playing basketball. He scheduled surgery for July 22. On July 21, he called the surgeon’s office complaining of swelling and that an area of the left calf was sensitive and warm to the touch. The surgery was uneventful and he was discharged from the hospital the same day. He returned to work and was doing well in a follow-up visit to his surgeon on August 2. Four days later he collapsed, went into cardiopulmonary arrest, and died as a result of a blood clot in the injured leg that had traveled to a lung. Prather’s widow applied for benefits under his Sun Life group life insurance policy (29 U.S.C. 1132(a)(1)), which limited coverage to “bodily injuries ... that result directly from an accident and independently of all other causes.” The district court granted Sun Life summary judgment. The Seventh Circuit reversed, noting that deep vein thrombosis and pulmonary embolism are risks of surgery, but that even with conservative treatment, such as immobilization of the affected limb, the insured had an enhanced risk of a blood clot. The forensic pathologist who conducted a post-mortem examination of Prather did not attribute his death to the surgery. View "Prather v. Sun Life & Health Insurance Co." on Justia Law

Ryan sued his former employer, NextG, alleging that NextG had breached a promise to grant him lucrative stock options as a condition of his employment. The case went to the jury with an “unclear special verdict form and unhelpful instructions.” The jury sustained two contract-based causes of action, but failed to find the value of the promised options, despite a directive on the verdict form that it do so. Instead it made a finding of the income plaintiff lost by entering the employment relationship, despite a directive obviating such a finding in light of the jury’s rejection of plaintiff’s tort causes of action. The trial court denied a motion for a new trial, and suggesting that declarations were necessary to determine “what the jury actually did.” The court of appeal reversed with instructions to grant a new trial. The court was fully empowered and obligated to make an independent assessment of the adequacy of the verdict, which was unmistakably unsound. If viewed as an award of tort damages, it had no foundation in law. If viewed as an award of contract damages, it had no foundation in fact. View "Ryan v. Crown Castle NG Networks, Inc." on Justia Law

Jackman Construction, Inc. (Jackman) was the successful bidder on a project to install new water lines and a pump station for the City of Green River. Rock Springs Winnelson Co. (Winnelson) supplied materials for the project. Jackman eventually stopped paying Winnelson’s invoices, and Winnelson refused to provide any more materials. Winnelson filed suit against Jackman for its failure to pay invoices totaling $21,705, which included principal and service charges. Jackman counterclaimed for, inter alia, breach of contract and promissory estoppel. The district court granted judgment in favor of Winnelson on the outstanding principal, denied Winnelson’s claim for unpaid service charges, and denied Jackman’s counterclaims. The Supreme Court affirmed, holding (1) the district court erred in refusing to accept the parties’ stipulation as to the amount Jackman paid Winnelson, but the error was harmless; (2) the district court did not err in the remainder of its judgment; and (3) sanctions were not warranted. View "Jackman Construction, Inc. v. Rock Springs Winnelson Co." on Justia Law

Appellant Leo Gilbride contended that the district court erred by refusing his request for attorney’s fees. The underlying dispute arose out of a sale of real property between Respondent David Kosmann and Gilbride, which was executed with the alleged understanding that Gilbride would re-convey the property back to Kosmann at a later time. After purchasing the property, with down payment funds provided by Kosmann, Gilbride refused to re-convey the property to Kosmann. Accordingly, Kosmann filed a complaint against Gilbride alleging, inter alia, unjust enrichment and demanding specific performance of Gilbride’s promise to re-convey the property. The district court dismissed the specific enforcement claim, awarded Kosmann $30,990 based on his unjust enrichment claim, and denied both parties’ claims for attorney’s fees. Finding no reversible error in the district court's order, the Idaho Supreme Court affirmed. View "Kosmann v. Gilbride" on Justia Law

The issue presented for the Vermont Supreme Court's review was found in a series of e-mails exchanged between two business partners who jointly owned a document shredding company, and whether those e-mails (read together) constituted an enforceable contract to sell one partner's interest in the company to the other partner. Defendant-seller appealed the trial court's determination that the partners had an enforceable contract and that seller was obligated to negotiate the remaining terms of the deal in good faith. He argued that there were too many open terms to produce an enforceable contract and that the partners had no intent to be bound to a contract by their e-mails. Plaintiff-buyer cross-appealed, arguing that the e-mails demonstrated an intent to be bound, and that the Supreme Court should enforce the contract. The Supreme Court rejected the buyer's argument that the parties had entered into a fully-completed contract, and agreed with the seller that there was no enforceable contract at all. The Court reversed the trial court which held to the contrary, and remanded the case for entry of judgment in favor of the seller. View "Miller v. Flegenheimer" on Justia Law

Plaintiffs filed a putative class action suit against their former employer, alleging violations of the Illinois Wage Payment and Collection Act (IWPCA), and other state wage payment statutes, including the New York Labor Law and California Labor Code. They claimed that Medline’s practice of accounting for year-to-year sales declines in calculating and paying commissions was impermissible under the terms of their employment agreements and state wage laws. The district court granted Medline summary judgment, finding that plaintiffs had not performed enough work in Illinois for the IWPCA to apply and that Medline and the plaintiffs had agreed to Medline’s method of calculating commissions, so there was no violation of state wage laws. The Seventh Circuit affirmed. Medline’s commission structure is consistent with the written agreements. The court rejected an argument that the structure was, nonetheless, a per se violation of New York and California labor law because it impermissibly recoups Medline’s business losses from its Sales Representatives, even when those losses are outside Sales Representatives’ control. Medline’s inclusion of negative growth in its commission calculation was not an unlawful deduction in disguise, but rather a valid means of incentivizing their salespeople to grow business in their assigned territories. View "Cohan v. Medline Industries, Inc." on Justia Law

Bank foreclosed its loan on residential real estate and resold the property to Buyers. The purchase agreement for the transaction contained an arbitration clause. After Buyers learned that another bank had a superior lien against the real estate they sued Bank for damages. Bank filed a motion to compel arbitration pursuant to the purchase agreement. The district court sustained the motion. The Supreme Court affirmed, holding (1) the purchase agreement was governed by the Federal Arbitration Act, and Buyers’ claims were subject to the arbitration clause; and (2) there was no merit to Buyers’ other arguments. View "Wilczewski v. Charter West National Bank" on Justia Law

Todd Hill, Roy Hill, Brian Hill, and Debra Hill Stewart were the children of Leroy Hill, who died testate in 2009. Deborah D. Hill, Leroy’s second wife, offered Leroy's will for probate. The Hill children hired attorneys Vincent Kilborn III and David McDonald to bring a breach-of-contract action against the estate and Deborah, alleging breach of an agreement between Leroy and the Hills' mother at the time Leroy divorced the Hills' mother in 1984 to make a will leaving the Hills a coffee company and a family ranch. The Hills and the attorneys entered into a retainer agreement, which required the Hills to pay the attorneys "40% of any recovery, in the event there is a recovery, with or without suit." According to the agreement, "recovery" included cash, real or personal property, stock in the Leroy Hill Coffee Company, and all or part ownership in the family ranch. After a trial, a judgment was entered for the Hills ordering specific performance of the contract, which required the conveyance of the coffee company and the ranch to the Hills. The Alabama Supreme Court affirmed the trial court's judgment, without an opinion. At issue before the Supreme Court involved the attorney fee. The Supreme Court found that the circuit court exceeded the scope of its discretion when it failed to order the payment of the attorney fee in accordance with the retainer agreement. The Hills petitioned for a writ of mandamus to direct the circuit court to vacate two order for lack of subject-matter jurisdiction. Specifically, they argued that the circuit court did not have jurisdiction to determine the 40% contingency fee owed the attorneys was an administrative expense of the estate and, consequently, that the circuit court did not have subject-matter jurisdiction when any subsequent order at issue in this case. The Supreme Court concluded the circuit court had jurisdiction over the administration of the estate, so the petition for a writ of mandamus (case no. 1150162) was denied; the orders pertaining to payment of the retainer were reversed (case no. 1150148) and the matter remanded for further proceedings. View "Hill v. Kruse" on Justia Law

In early 2008, plaintiff-appellant Taghi Alereza agreed to help his nephew Habib (Bobby) purchase a business consisting of a gas station and convenience store in Sacramento. They planned to have Bobby run the business. Alereza’s role involved nothing more than providing the initial purchase funds and a $100,000 note secured by his residence. The sole issue in this appeal centered on whether escrow company Chicago Title Company (Chicago Title) owed a legal duty of care to Alereza, who was not a party to the escrow nor mentioned as a third party beneficiary in the escrow instructions. Chicago Title admitted its employee negligently listed the wrong name of the insured (the purchaser of the gas station business) when securing a new certificate of insurance for the business. “This was the first of a series of missteps by several persons that eventually led to Alereza giving a personal guarantee to save the gas station business.” Claiming damages for losses incurred after giving his personal guarantee, Alereza sued Chicago Title. The trial court granted Chicago Title’s motion for nonsuit, and Alereza appealed. The Court of Appeal concluded Chicago Title did not owe a duty of care to Alereza because he was not a party to the escrow, not mentioned in the escrow instructions as a third party beneficiary, and did not sustain his losses as a direct result of the escrow company’s negligence. View "Alereza v. Chicago Title Co." on Justia Law

This case arose out of dispute between the Association of Apartment Owners of Royal Aloha, its former property managers, and its former commercial tenants. The AOAO installed an electricity submetering system and submitted readings of each unit’s electricity submeter to the managing agent, who would bill each owner for electricity. For certain years, some commercial tenants were never billed for electricity, and some were erroneously billed for a portion of those electricity costs. The AOAO sued its former property managers for, inter alia, breach of contract for the billing errors. The AOAO also sued the commercial tenants to recover the unbilled or erroneously billed electricity costs. The circuit court granted summary judgment for all defendants, concluding that all claims were barred under the doctrine of laches. The Intermediate Court of Appeals reversed, concluding that the defense of laches applies only to equitable claims. The Supreme Court reversed, holding that laches is a defense to legal and equitable claims alike. View "Association of Apartment Owners of Royal Aloha v. Certified Management, Inc." on Justia Law