Justia Contracts Opinion Summaries

Articles Posted in Florida Supreme Court
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When Hampton Court Nursing Father admitted Father to its nursing home facility, Son and Hampton Court signed a a nursing home contract that included an arbitration clause. Father did not sign the contract. Son later filed suit on Father’s behalf, alleging negligence and statutory violations. The circuit court granted Hampton Court’s motion to compel arbitration and stay the judicial proceedings. The Third District Court of Appeal affirmed, concluding that Father was the intended third-party beneficiary of the nursing home contract, and therefore, Hampton Court could bind him to its contract, which Father never signed. The Supreme Court quashed the Third District’s decision, holding that the third-party beneficiary doctrine did not bind Father to the arbitration agreement in the nursing home admission agreement. View "Mendez v. Hampton Court Nursing Center, LLC" on Justia Law

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CSX Transportation requested indemnification from the Florida Department of Transportation (DOT) for the amount paid to resolve a negligence action arising from an accident at a railroad crossing. CSX based its request on a railroad crossing agreement under which the DOT received a revocable license to use land as a right-of-way. The sole consideration for the license was an agreement to indemnify the railroad for losses arising out of DOT’s activity on the land. The trial court required DOT to indemnify CSX for the settlement of the lawsuit and for the expenses arising from DOT’s failure to defend the suit. DOT appealed, arguing that the indemnity clause was invalid. The Second District Court of Appeal concluded that the indemnity clause was enforceable. The Second District then certified two questions to the Supreme Court. The Supreme Court answered (1) DOT is bound by the indemnity provision as party of the statutorily authorized railroad crossing agreement, and breach-of-contract principles prohibit DOT from using sovereign immunity to avoid suit for its breach of the crossing agreement; and (2) DOT’s liability under the crossing agreement is not limited by Fla. Stat. 768.28(5). View "Fla. Dep’t of Transp. v. Schwefringhaus" on Justia Law

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In this contract dispute between a home health care agency, Visiting Nurse Association of Florida, Inc. (VNA), and a hospital, Jupiter Medical Center, Inc. (JMC), an arbitration panel granted VNA damages. JMC filed a motion to vacate the arbitration award, alleging that the arbitration panel construed the contract containing an arbitration provision to be an unlawful agreement. The circuit court dismissed the motion to vacate and granted the motion to enforce the award. The Fourth District Court of Appeal reversed, holding that a court must determine whether a contract is legal prior to enforcing an arbitral award based on the contract. The Supreme Court quashed the Fourth District’s decision, holding (1) the claim that an arbitration panel construed a contract containing an arbitration provision to be an unlawful agreement is an insufficient basis to vacate an arbitrator’s decision pursuant to the Federal Arbitration Act or the Florida Arbitration Code; and (2) the arbitration panel did not exceed its powers in this case. View "Visiting Nurse Ass'n of Fla., Inc. v. Jupiter Med. Ctr., Inc." on Justia Law

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At issue in this case was whether Florida law recognizes a “bright-line rule” that distinguishes an assignment from a sublicense. This complex commercial litigation involved an agreement wherein a licensee transferred its entire interest in a patent license agreement except for one day. A federal district court concluded that the agreement was a prohibited assignment and not a sublicense. On appeal, the Eleventh Circuit certified the question of whether a “bright-line” rule could be applied to determine whether the licensee’s transfer of its interest constituted an assignment or a sublicense. The Supreme Court answered the certified question in the negative, holding that this legal determination depends on a multiple of factors, and the ultimate resolution of whether the transfer of the licensee’s interest constitutes an assignment or a sublicense is a mixed question of law and fact. View "MDS (Canada) Inc. v. Rad Source Techs., Inc." on Justia Law

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Buyers, a married couple from Cuba who were only able to communicate in Spanish, purchased a vehicle from a Dealership. Two of the documents Buyers signed with regard to the purchase contained arbitration clauses, and all of the documents were written in English. Buyers subsequently sued the Dealership for fraud in the inducement and violation of the Florida Deceptive and Unfair Trade Practices Act. The Dealership moved to dismiss the complaint and/or compel arbitration. The trial court denied the motion, concluding that no valid agreement to arbitrate existed because the arbitration provisions were not agreed upon by the parties and that the provisions were unenforceable because they were procedurally and substantively unconscionable. The Third District Court of Appeal affirmed the trial court’s order denying enforcement of the agreement to arbitrate disputes but reversed the order insofar as it declined to enforce the arbitration on the reverse side of the retail installment contract with respect to Buyers’ claims for monetary relief. The Supreme Court quashed the decision of the Third District and remanded with instructions to reinstate the trial court’s judgment based on controlling precedent. View "Basulto v. Hialeah Auto." on Justia Law

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After Plaintiff was rear-ended by an underinsured motorist (UM), Plaintiff requested her $100,000 UM policy limits from State Farm. Plaintiff indicated that her damages were estimated to be $3.5 million because she suffered from reflex sympathetic dystrophy syndrome. State Farm responded that Plaintiff must schedule a compulsory medical examination (CME) pursuant to the terms of the policy. Plaintiff refused to attend a CME and instead filed suit against State Farm. The trial court entered judgment against State Farm for the UM policy limits. The court of appeal affirmed, holding (1) Plaintiff breached the contract when she failed to attend the CME; but (2) State Farm must plead and prove prejudice to avoid liability based on noncompliance with the CME clause, and State Farm failed to meet its burden in this case. The Supreme Court approved of the court of appeal’s decision, holding (1) the forfeiture of benefits under a UM policy will not automatically result upon an insured’s breach of a CME provision unless the insurer pleads and proves actual prejudice as an element of its affirmative defense; and (2) the undisputed facts demonstrate that State Farm was not prejudiced in this case. View "State Farm Mut. Auto. Ins. Co. v. Curran" on Justia Law

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ICI Homes, Inc. (ICI) had a general liability insurance policy with General Fidelity Insurance Company. In 2007, Katherine Ferrin, the owner of a residence constructed by ICI, was injured while using stairs installed by Custom Cutting, Inc. Ferrin filed suit against ICI. ICI, in turn, sought indemnification from Custom Cutting. The parties agreed to a $1.6 million settlement of Ferrin’s claim. ICI accepted $1 million from Custom Cutting’s insurer to settle its indemnification claim, which it paid to Ferrin. ICI and General Fidelity then claimed the other was responsible for paying Ferrin the remaining $600,000. Both parties paid $300,000 to Ferrin to settle Ferrin’s claim. ICI then filed suit against General Fidelity seeking return of the $300,000 ICI paid above the $1 million indemnification payment. General Fidelity counterclaimed seeking return of the $300,000 it had paid to Ferrin. The district court entered judgment for General Fidelity. The court of appeals certified two questions to the Supreme Court for resolution. The Supreme Court answered (1) the General Fidelity policy allowed ICI to apply indemnification payments received from Custom Cutting’s insurer towards satisfaction of its $1 million self-insured retention; and (2) the transfer of rights provision in the policy did not abrogate the made whole doctrine. View "Intervest Constr. of Jax, Inc. v Gen. Fidelity Ins. Co." on Justia Law

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Buyers purchased two condominium units pursuant to contracts entered into in 2006. Buyers later contended that the contracts were voidable because Seller failed to maintain Buyers’ deposits in escrow in the manner required by the Condominium Act (the Act). The trial court dismissed the claims against Seller. The Third District Court of Appeal reversed, concluding (1) the contracts were voidable under the escrow provisions of the Act that were in force in 2006; and (2) the application of a 2010 amendment to the Act that was intended to have retroactive effect and that removed a statutory ground for determining that the contracts were voidable violated the constitutional prohibition on the impairment of vested contractual rights. The Supreme Court reversed, holding (1) the 2010 amendment did not make a substantive change in the law; and (2) the contracts were not voidable under the statutory provisions in force in 2006. View "N. Carillon, LLC v. CRC 603, LLC" on Justia Law

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Lakeview Reserve Homeowners Association filed an action against Maronda Homes, Inc. for breach of the implied warranties of fitness and merchantability (referred to as the implied warranty of habitability in the residential construction context) arising from alleged defects in the development and construction of a residential subdivision that Maronda Homes developed. Maronda Homes filed a third-party complaint against T.D. Thomson Construction Company for indemnification based on the alleged violation of the implied warranties. The trial court entered summary judgment in favor of Maronda Homes and T.D. Thompson on the basis that the common law implied warranties of fitness and merchantability do not extend to the construction and design of the infrastructure, private roadways, drainage systems or other common areas in a residential subdivision because those structures do not immediately support the residences. The court of appeal reversed, holding that the common law warranty of habitability was applicable in this case. The Supreme Court affirmed, holding that the implied warranties of fitness and merchantability applied to the improvements that provided essential services to the homeowners association. Remanded. View "T.D. Thomson Constr. Co. v. Lakeview Reserve Homeowners Ass'n, Inc." on Justia Law

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Lakeview Reserve Homeowners Association filed an action against Maronda Homes for breach of the implied warranties of fitness and merchantability, also referred to as the implied warranty of habitability in the residential construction context. The underlying cause of action arose from alleged defects in the construction and development of a residential subdivision that Maronda Homes and T.D. Thomson Construction Company developed. Lakeview Reserve served as the homeonwers association of the division. Maronda Homes filed a third-party complaint against T.D. Thomson for indemnification based on the alleged violations by Maronda Homes. The trial court entered summary judgment in favor of Maronda Homes and T.D. Thompson, finding that the common law implied warranties of fitness and merchantability do not extend to the construction and design of the private roadways, infrastructure, or any other common areas in a residential subdivision. The court of appeal reversed, holding that the common law warranty of habitability applied in this case. The Supreme Court affirmed, holding that the implied warranties of fitness and merchantability applied to the improvements that provided essential services to the homeowners association. Remanded. View "Maronda Homes, Inc. of Fla. v. Lakeview Reserve Homeowners Ass'n" on Justia Law