Justia Contracts Opinion Summaries

Jill and Grant Wiese were married for nearly 30 years before their marriage was dissolved in 2016. They had a premarital agreement (PMA) that kept their assets and earnings separate, with Grant responsible for reasonable support. Jill worked as an independent agent for Grant’s real estate brokerage, receiving 100% of her commissions after deductions for business expenses and estimated taxes. Grant deducted amounts for taxes and personal expenses he believed exceeded his support obligations, but the tax deductions did not match the actual taxes paid, and he did not refund the excess to Jill.The Superior Court of Orange County found the PMA valid and enforceable. Jill then brought claims against Grant for breach of fiduciary duty, arguing that his deductions from her commissions were excessive and impaired her separate property. Grant countered that Jill’s claims were time-barred and meritless. The trial court ruled in Jill’s favor on the tax-withholding claims, awarding her over $1.3 million, but rejected her other claims. Both parties appealed.The California Court of Appeal, Fourth Appellate District, reviewed the case. It held that Jill’s fiduciary duty claims were subject to a four-year statute of limitations and that most were time-barred. For the surviving claims, the court found Grant breached his fiduciary duty by withholding excessive amounts for taxes but erred in awarding Jill the entire amount withheld rather than the excess. The court also found that Grant’s deductions for personal expenses required reconsideration. It affirmed that Grant was solely liable for the mortgage debt on their jointly owned property but reversed the order requiring Jill to reimburse Grant for housing during their separation. The court remanded for further proceedings, including recalculating damages and reconsidering attorney fees. View "Marriage of Wiese" on Justia Law

The case involves a dispute between Julie and Gary Liebel, who married in 2010 and divorced in 2022. Prior to their marriage, they had signed a premarital agreement stating that each party's assets would remain separate and under their sole control, even after the marriage. The agreement also stated that neither party would acquire any interest in the other's property due to the marriage. The couple divorced on the grounds of adultery, and the circuit court applied the premarital agreement in dividing their assets. Julie appealed, arguing that the court erred in applying the agreement to the property division in the divorce and abused its discretion in classifying and distributing the parties’ property.The circuit court had found the premarital agreement to be valid and enforceable in the context of divorce. It also found that the agreement unambiguously governed the division of property in the event of divorce. The court treated the marital home, which was held jointly, as marital property, but most of the remaining property was treated as nonmarital. Gary received the bulk of the nonmarital property valued at $713,705. Upon division of the net marital assets, Julie was awarded marital property valued at $35,482, while Gary received marital property valued at $134,535. The court ordered Gary to make a cash equalization payment to Julie in the amount of $49,526, less $2,062.80 in attorney fees awarded to Gary for defending a protection order that the court determined Julie filed maliciously.The Supreme Court of the State of South Dakota affirmed the lower court's decision. It found that the premarital agreement unambiguously provided that neither spouse may claim an interest in the separate property of the other, whether it was acquired before or during the marriage. This could only be understood to mean that the other spouse would not obtain any interest in separately owned property under any circumstances, including divorce, unless mutually agreed to by creating a joint tenancy in any property. The court also found no abuse of discretion in the lower court's division of property. View "Liebel v. Liebel" on Justia Law

The case involves a dispute over a postnuptial modification of a premarital agreement. The parties, David and Elizabeth Roberts, entered into a premarital agreement before their marriage in 1993. The agreement stipulated that each spouse waived their statutory elective share, but agreed that each would take one-third of the other’s net real property interests at the time of death. Twenty-four years later, the parties executed a new agreement, a "partial revocation" of the premarital agreement, which maintained the waiver of elective share but relinquished their one-third share in each other’s real property investments at the time of death. Elizabeth received approximately $15,000 cash and $50,000 in debt repayment or forgiveness from David, plus a monthly living allowance for as long as the couple remained married. After David's death, Elizabeth contested the validity of this partial revocation.The district court rejected Elizabeth's challenge and enforced the partial revocation. Elizabeth appealed the decision to the Supreme Court of Iowa.The Supreme Court of Iowa reversed the district court's decision. The court concluded that under Iowa law, specifically Iowa Code sections 596.7 and 597.2, a postmarital amendment to a premarital agreement relating to inchoate dower interests in property is not enforceable. The court found that the partial revocation was essentially an amendment, not a revocation, and that Iowa law does not permit married persons who previously entered into a premarital agreement to enter into a new agreement during their marriage relating to inchoate dower interests in each other’s property. The court remanded the case for further proceedings regarding counterclaims made by David's son, Eric, who asked that if the partial revocation agreement is invalidated, Elizabeth should be required to relinquish the benefits she received as a result thereof to avoid unjust enrichment. View "Roberts v. Roberts" on Justia Law

This case involves a group of plaintiffs who were minors at the time their guardians purchased and activated DNA test kits from Ancestry.com. The plaintiffs, through their guardians, provided their DNA samples to Ancestry.com for genetic testing and analysis. The plaintiffs later sued Ancestry.com, alleging that the company violated their privacy rights by disclosing their confidential genetic information to another business. Ancestry.com moved to compel arbitration based on a clause in its Terms & Conditions agreement, which the plaintiffs' guardians had agreed to when they purchased and activated the test kits.The United States Court of Appeals for the Seventh Circuit, applying Illinois law, held that the plaintiffs were not bound to arbitrate their claims under the agreement between their guardians and Ancestry.com. The court reasoned that the plaintiffs neither signed the agreement nor created Ancestry.com accounts, and did not independently engage with Ancestry.com's services. Furthermore, the court refused to bind the plaintiffs to the agreement based on equitable principles, including the doctrine of direct benefits estoppel. The court noted that while the plaintiffs theoretically could benefit from Ancestry.com's services, there were no allegations that the plaintiffs had actually accessed their DNA test results.The court therefore affirmed the district court's decision denying Ancestry.com's motion to compel arbitration. The court's holding clarified that under Illinois law, a minor cannot be bound to an arbitration agreement that their guardian agreed to on their behalf, unless the minor independently engaged with the services provided under the agreement or directly benefited from the agreement. View "Coatney v. Ancestry.com DNA, LLC" on Justia Law

In this case, two individuals, Tong Vang and Pa Kou Xiong, were in a relationship recognized by Hmong cultural customs but were not legally married. They had two children together. Upon their separation, Xiong sought repayment of $38,000, which she claimed were loans to Vang and his family. Vang disputed this and counterclaimed for damages. The Superior Court of the State of Alaska found in favor of Xiong, and Vang appealed.On appeal, Vang argued that the court should have applied a presumption that transfers of funds between close relatives are considered gifts rather than loans. However, the Supreme Court of the State of Alaska rejected this argument because the parties were not legally married or in a domestic partnership, and they were not close relatives. Additionally, the court found that the record supported the lower court’s finding that Xiong intended the transfers of money to be loans.The court affirmed the lower court’s judgment, holding that the Superior Court did not err in treating the transfers as loans rather than gifts. The court found that Vang did not establish that he and Xiong were married, in a domestic partnership, or close relatives, which would have triggered the presumption that the transfers were gifts. Furthermore, the court found that the record supported the Superior Court's finding that Xiong intended the transfers of money to be loans. View "Vang v. Xiong" on Justia Law

The Supreme Court affirmed in part and reversed in part the judgments of the district court adjudicating a parental interest and accompanying parenting plan regarding Father's minor child in favor of his non-parent ex-wife (Surrogate), holding that the district court erroneously made a child custody parenting plan determination involving a non-parent without the predicate parental interest implied as a condition precedent to imposition of a best interests-based parenting plan.Specifically, the Supreme Court held that the district court (1) correctly concluded that the preclusive terms of a gestational carrier agreement did not preclude Surrogate from later acquiring or establishing a parental interest and right to the extent independently authorized under Montana law; (2) did not err in finding and concluding that Father voluntarily signed the premarital agreement and that it ws thus a validly formed and enforceable contract; (3) did not erroneously reject Father’s assertion that the parent-child relationship provision was unenforceable as equitably unconscionable; and (4) erroneously adjudicated a non parent "parental interest" in favor of Surrogate without the required predicated finding of fact specified by Mont. Code Ann. 40-4-228(2)(a). View "Sayler v. Yan Sun" on Justia Law

The Supreme Court affirmed the judgment of the trial court dissolving Plaintiff's marriage to Defendant, holding that Plaintiff was not entitled to relief on his allegations of error.At issue in this case was the extent to which a Connecticut court may enforce the terms of a "ketubah," a contract governing marriage under Jewish law. The trial court in this case denied Plaintiff's motion to enforce the terms of the parties' ketubah as a prenuptial agreement on the ground that doing so would be a violation of the First Amendment to the United States constitution. The Supreme Court affirmed, holding (1) the trial court properly denied Plaintiff's motion to enforce the ketubah; and (2) the trial court's alimony order, considered in light of Plaintiff's net earning capacity, was not an abuse of discretion. View "Tilsen v. Benson" on Justia Law

The Supreme Court held that Maryland law allows spouse to allocate martial assets in a postnuptial agreement based on whether a spouse engaged in adultery, thereby causing the breakdown of the marriage, thus affirming the judgment of the lower courts.Plaintiff filed a complaint for absolute divorce on the grounds of adultery, requesting that the circuit court incorporate the parties' postnuptial agreement into the decree. The agreement included a $7 million lump sum provision that triggered if Defendant engaged in adultery. The circuit court determined that the lump sum provision was an enforceable penalty and issued a judgment of divorce that incorporated, but did not merge, the agreement. The appellate court affirmed. The Supreme Court affirmed, holding (1) the public policy in Maryland supports intefspousal distributions of marital assets based on adultery in postnuptial agreements; and (2) Plaintiff was entitled to no more than Defendant's "50% share of the Column B Assets." View "Lloyd v. Niceta" on Justia Law

Husband Steven McAnulty was married twice: once to Plaintiff Elizabeth McAnulty, and once to Defendant Melanie McAnulty. Husband's first marriage ended in divorce; the second ended with his death. Husband’s only life-insurance policy (the Policy) named Defendant as the beneficiary. But the Missouri divorce decree between Plaintiff and Husband required Husband to procure and maintain a $100,000 life-insurance policy with Plaintiff listed as sole beneficiary until his maintenance obligation to her was lawfully terminated (which never happened). Plaintiff sued Defendant and the issuer of the Policy, Standard Insurance Company (Standard), claiming unjust enrichment and seeking the imposition on her behalf of a constructive trust on $100,000 of the insurance proceeds. The district court dismissed the complaint for failure to state a claim. Plaintiff appealed. By stipulation of the parties, Standard was dismissed with respect to this appeal. The only question to be resolved was whether Plaintiff stated a claim. Resolving that issue required the Tenth Circuit Court of Appeals to predict whether the Colorado Supreme Court would endorse Illustration 26 in Comment g to § 48 of the Restatement (Third) of Restitution and Unjust Enrichment (Am. L. Inst. 2011) (the Restatement (Third)), which would recognize a cause of action in essentially the same circumstances. Because the Tenth Circuit predicted the Colorado Supreme Court would endorse Illustration 26, the Court held Plaintiff has stated a claim of unjust enrichment, and accordingly reversed the previous dismissal of her case. View "McAnulty v. McAnulty, et al." on Justia Law

The Supreme Court held that an injury settlement agreement between the married couple in this case and a third party did constitute a valid and binding property settlement or postnuptial agreement, thus reversing the trial court's judgment and remanding the case for further proceedings.Husband and Wife sued the manufacturer of Husband's pacemaker, among other parties, claiming medical malpractice. The couple were awarded $2 million in compensatory damages and $5.4 million in punitive damages. Thereafter, the couple entered into a written settlement agreement with the pacemaker manufacturer requiring, for purposes of this appeal, Husband and Wife to use $5.4 million of the settlement to fund a series of annuity payments. Later, the parties separated, and the trial court entered a dissolution decree finding that the parties had agreed to the allocation of the settlement funds. Wife appealed, arguing that the punitive damages portion of the agreement was a community asset that should have been equitably divided. The court of appeals affirmed. The Supreme Court reversed the trial court's determination that the annuity payments were not community property based on the settlement, holding that the agreement was not a valid postnuptial agreement. View "Sowards v. Sowards" on Justia Law