Justia Contracts Opinion Summaries

In 2010, Irene and John Moerman each signed an oil and gas lease with Prairie Rose Resources. In 2011, the Moermans filed a complaint for declaratory judgment claiming that their leases with Prairie had expired because, inter alia, Prairie had failed to establish oil production until after the expiration of the primary term of the lease. Prairie counterclaimed for a declaration that the lease remained in effect. The district court entered judgment in favor of Prairie and awarded Prairie its attorney fees and costs. The Supreme Court affirmed, holding (1) the district court correctly concluded that the parties' oil and gas leases remained in effect; and (2) because the Moermans failed to establish that the leases had been forfeited, Prairie's attorney fees in defending the action were recoverable. View "Moerman v. Prairie Rose Res., Inc." on Justia Law

Clifford Sabo and Sabo Brothers Construction (the Sabos) entered into a written lease agreement with Vernon and Laura Caldwell for the excavation of scoria, a substance used in road construction, on the Caldwells' land. The Sabos agreed to pay the Caldwells a royalty rate for all scoria sold from the Caldwells' land, but the lease was silent as to when royalty payments were to be made. For several months, the Sabos made royalty payments to the Caldwells but for another period of several months, the Sabos did not make any royalty payments at all. The Caldwells subsequently filed a complaint against the Sabos, alleging breach of the lease for failure to pay royalties in a timely manner. The Caldwells also filed an application for a preliminary injunction. The district court enjoined the Sabos from hauling or selling any scoria from the Caldwells' land, concluding that the Caldwells had made a prima facie case that the Sabos had not paid them for all the scoria sold. The Supreme Court reversed, holding that the district court erred in granting the Caldwells a preliminary injunction in a breach of contract action when pecuniary compensation was contemplated and would afford adequate relief. Remanded. View "Caldwell v. Sabo" on Justia Law

This case arose from disputes between the Department of Information Technology and Defendant, a computer equipment supplier, over two contracts between the parties. The Department filed this action against Defendant, alleging breach of contract and fraud claims. Defendant filed an amended counterclaim, alleging takings and due process violations. The Department moved to dismiss the takings and due process claims based on the State's sovereign immunity. The trial court determined that the Department had waived the State's sovereign immunity regarding Defendant's counterclaims by bringing this cause of action against Defendant. After a jury trial, the trial court awarded Defendant damages on its procedural due process counterclaim. The Supreme Court (1) reversed the judgment of the trial court in favor of Defendant on the procedural due process counterclaim, holding that the Department did not waive the state's sovereign immunity by initiating the present litigation, and therefore, the trial court lacked subject matter jurisdiction over Defendant's counterclaims; and (2) affirmed in all other respects. View "Chief Info. Officer v. Computers Plus Ctr., Inc." on Justia Law

Plaintiff appealed a Court of Chancery order that granted summary judgment and dismissed his suit on laches grounds. The underlying dispute arose over capital investments plaintiff made in two companies. Upon review, the Supreme Court concluded plaintiff's arguments made on appeal lacked merit, however, the Court reversed and remanded on different grounds. View "Levey v. Brownstone Asset Management, LLP, et al." on Justia Law

The Aleut Corporation terminated its chief executive officer, Troy Johnson. He challenged the termination, and according to his employment contract, the matter was submitted to binding arbitration. That agreement contained a broad arbitration clause providing that "[a]ny and all disputes . . . arising out of, relating in any way to or in connection with this Agreement and/or Executive's employment with or termination of employment from the Company . . . shall be solely settled by an arbitration." The parties disputed whether the Corporation had violated the contract by terminating Johnson and whether Johnson's alleged breach of contract justified the termination. The arbitrator awarded damages to Johnson, finding the Corporation violated the contract. The Aleut Corporation petitioned the superior court to vacate the arbitrator's decision, claiming that the arbitrator had addressed an issue that was never submitted to arbitration and was thus not arbitrable. The superior court vacated the arbitration award, concluding that the arbitrator had exceeded his authority, and Johnson appealed. Because the dispute was arbitrable, the Supreme Court concluded that the arbitrator did not exceed his authority, and therefore reversed the superior court's decision to vacate the award. View "Johnson v. The Aleut Corporation" on Justia Law

Seller and Buyers entered into a contract for a deed. Buyers made payments to Seller for almost three years. Because Seller did not provide Buyers with all information required by Tex. Prop. Code 5(D), Buyers later told Seller they were exercising their statutory right to cancel and rescind the contract for deed. Seller sued Buyers for breach of contract. Buyers counterclaimed for violations under the Property Code, among other statutory violations. Seller, in turn, alleged he was entitled to a setoff in the amount of the fair market rental value of the property for the time Buyers occupied the house. The trial court entered judgment in favor of Buyers, awarding actual damages for cancellation and rescission of the contract for deed, among other damages. The Court reversed the trial court's awards of actual damages for cancellation and rescission, holding (1) subchapter D's cancellation-and-rescission remedy contemplates mutual restitution of benefits among the parties; and (2) thus, Buyers were required to restore to Seller supplemental enrichment in the form of rent for their interim occupation of the property upon cancellation and rescission of the contract for deed. Remanded. View "Morton v. Nguyen" on Justia Law

Respondents were successors-in-interest to 380 acres of land once owned by Baker, now deceased. Petitioners entered into a lease agreement with Baker that contained an option allowing Petitioners to buy the land if Baker decided to sell it. Petitioners and Baker subsequently agreed that Petitioners would purchase the 380 acres for $470,000. Petitioners attempted to exercise their right to buy the property under the agreement, but Respondents brought a declaratory judgment action to void the agreement. The trial court rendered a final judgment for Petitioners. The court of appeals reversed, concluding (1) the agreement was ambiguous as to whether it was a presently binding contract or merely an agreement to agree, and (2) therefore, the agreement's enforceability was a fact issue that should not have been determined by summary judgment. The Supreme Court reversed, holding that the agreement contained all material terms and was an enforceable contract as a matter of law. Remanded. View "McCalla v. Baker's Campground, Inc." on Justia Law

Homes built with an exterior insulation and finish system (EIFS) suffer serious water damage that worsens over time. Homebuilder began a remediation program in which it offered to homeowners to remove exterior EIFS from the homes it had built and to replace it with conventional stucco. Almost all the homeowners accepted Homebuilder's offer of remediation. Homebuilder sought indemnification for the costs from its insurers (Insurers). Insurers denied coverage, preferring instead to wait until the homeowners sued. This litigation ensued. Now, only one insurer remained. The court of appeals reversed the trial court's judgment in favor of Homebuilder, finding (1) Homebuilder failed to establish its legal liability to the homeowners to trigger Insurer's coverage; and (2) Homebuilder failed to offer evidence of damages covered by the policy. The Supreme Court reversed, holding (1) Homebuilder's settlements with the homeowners established both Insurer's legal liability for the property damages and the basis for determining the amount of loss; and (2) Insurer's policy covered Homebuilder's entire remediation costs for damaged homes. View "Lennar Corp. v. Markel Am. Ins. Co." on Justia Law

Petitioner was appointed the Police Commissioner of Baltimore City by the Mayor. Petitioner and the Mayor entered into a memorandum of understanding (MOU) that addressed the terms and conditions of Petitioner's employment, including his removal as Commissioner. The Mayor and City Council (Respondents) later relieved Petitioner of his command. Petitioner filed an amended complaint against Respondents seeking reinstatement and money damages. The circuit court granted summary judgment to Respondents. The intermediate appellate court reversed, holding that the Mayor did not have the authority to remove a Police Commissioner pursuant to a contract providing for removal without cause, and therefore, the removal provisions of the MOU were invalid. The Court of Appeals affirmed. Petitioner subsequently filed a motion for writ of mandamus or motion for injunction or reinstatement. The circuit court denied the motion and granted summary judgment to Respondents. The court of special appeals affirmed. The Court of Appeals affirmed, holding (1) because this Court did not decide the merits of Petitioner's claims for reinstatement and monetary damages, Petitioner was not entitled to reinstatement or judgment as a matter of law; and (2) the court of special appeals did not err in granting Respondents' summary judgment motion and denying Petitioner's motion for partial summary judgment. View "Clark v. O'Malley" on Justia Law

John Stubbs, Jr., d/b/a Mississippi Polysteel Stubbs was awarded damages for breach of contract after he sued Martin and Valerie Falkner to enforce a construction lien on their home. The Court of Appeals affirmed the circuit court’s judgment, but reversed its award of attorney’s fees and prejudgment interest, finding that Stubbs’s recovery was based in quantum meruit and thus, attorney’s fees and prejudgment interest were unavailable remedies. Stubbs petitioned for certiorari, arguing that the Court of Appeals failed to consider various statutory grounds for an award of attorney’s fees and prejudgment interest and requested that the Supreme Court reinstate the circuit court’s award. Upon review, the Court found the statutes Stubbs raised were an insufficient basis for an award of either prejudgment interest or attorney’s fees in this case and affirmed the Court of Appeals' decision. View "Falkner v. Stubbs, Jr." on Justia Law