Justia Contracts Opinion Summaries

The United States District Court for the Northern District of Georgia certified two questions to the Georgia Supreme Court. The questions related to the Automobile Insurance Company of Hartford Connecticut's umbrella policy issued to Louis and Betty Wilson. At the time, Georgia law required policies to have uninsured motorist coverage unless the insured rejected that coverage in writing. The Wilsons did not reject uninsured motorist coverage; their policy excluded such coverage despite being required by law. Because it was not written into the policy but required, it was implied by operation of law. In 2010, Louis Wilson was seriously injured in an accident, and gave notice of a claim for uninsured motorist benefits. The insurance company denied the claim, contending that a 2008 amendment to the Georgia law specifically excluded umbrella policies from mandatory uninsured motorist coverage. The questions from the federal court centered on whether the amendment to the applicable Georgia law applied to the Wilson's umbrella policy after 2009, and whether the notice requirements of the amended law applied to umbrella policies. After review, the Georgia Court concluded that the amendment in question here did not apply to the Wilson's umbrella policy, nor did the notice requirement. View "Wilson v. Automobile Insurance Co. of Hartford, Connecticut" on Justia Law

Woodard & Curran, Inc. ("W&C") sued the City of Baldwin seeking damages on claims of breach of contract and quantum meruit. After a trial, a jury awarded W&C $203,000 in a general verdict that did not specify the basis for the damages. The Court of Appeals affirmed. The Supreme Court granted certiorari to consider two issues: (1) whether the Court of Appeals erred in holding that quantum meruit was an available remedy against a municipality when the claim is based on a municipal contract that is ultra vires; and (2) whether the Court of Appeals erred in determining that the jury was properly allowed to consider the breach of contract claim based on an agreement the parties entered in May 2009. Upon review, the Court concluded that the Court of Appeals erred in both respects, and therefore reversed its judgment. View "City of Baldwin v. Woodard & Curran, Inc." on Justia Law

This appeal arose from appellee Bank of America, N.A.'s attempts to enforce the terms of the promissory note and deed to secure debt executed in its favor by appellant Johnta M. Austin ("Borrower"). The Bank sued to collect the debt it claimed the Borrower owed as a result of default, including attorney fees, and the trial court awarded the Bank summary judgment. The issue came on appeal to the Georgia Supreme Court because the constitutionality of the statute at issue was called into question. The Court has long held that "all presumptions are in favor of the constitutionality of an act of the legislature and that before an [a]ct of the legislature can be declared unconstitutional, the conflict between it and the fundamental law must be clear and palpable and [the] Court must be clearly satisfied of its unconstitutionality." The Court found that the statute in this case bore a rational relation to the purpose for which the statute was intended, namely to provide debtors with the opportunity to avoid the contractual obligation to pay the creditor’s attorney fees by allowing the debtor a last chance to pay the balance of the debt and avoid litigation. Further, the Court concluded that the application of OCGA 13-1-11 to arrive at the amount of the award of attorney fees in this case was neither punitive nor violative of Borrowers’ due process rights, nor was the award contrary to the intent of the statute. View "Austin v. Bank of America N.A." on Justia Law

Michael Holton appealed the grant of an interlocutory injunction prohibiting him from working in an executive capacity for a particular competitor of his former employer for one year. He also challenged the trial court's ruling that he would inevitably disclose his former employer's trade secrets and confidential information in violation of the trade secrets act and his confidentiality covenant if he went to work for the competing business. Because a stand-alone claim for the inevitable disclosure doctrine of trade secrets is not cognizable in Georgia, the Supreme Court reversed the part of the order enjoining Holton from the inevitable disclosure and use of trade secrets. On the remaining issues, the Court dismissed as moot his challenge to the order enjoining him from working for the competitor until October 2012 and affirmed the part of the order enforcing the confidentiality covenant. View "Holton v. Physician Oncology Services, LP" on Justia Law

Michael and Kelly Goodell divorced in 2006 by a Final Judgment and Decree which incorporated a settlement agreement. Pursuant to the agreement, Michael was required to pay Kelly alimony until she remarried. Michael also voluntarily agreed to make payments for the benefit of Kelly's two children from a previous marriage, after she remarried. Kelly remarried in 2008, and Michael began making payments to her children. Kelly died one year later, and Michael stopped making payments to her children. The administrator of Kelly's estate filed a contempt action against Michael for non-payment, contending that the payments were part of the property division in the divorce, and as such, survived Kelly's death. The trial court agreed with Kelly's estate; Michael thereafter appealed. Upon review, the Supreme Court found that the payments were a voluntary contractual obligation to be construed in the same manner and with the same rules of construction as other contractual agreements. The payments remained Michael's responsibility, and accordingly, the Court affirmed the trial court's judgment. View "Goodell v. Oliver" on Justia Law

In 2007, Appellant Derick Villanueva acted as the closing attorney for a mortgage-refinance transaction in which Homecomings Financial, LLC served as the lender supplying funds to pay off earlier mortgages on the secured property. Appellee First American Title Insurance Company issued title insurance on the transaction. Pursuant to Villanueva’s instructions, Homecomings wired funds into a specified escrow account. However, the funds were not used to pay off the earlier mortgages; instead, the funds were withdrawn and the account closed by a person not a lawyer. First American paid off the earlier mortgages and, pursuant to its closing protection letter to Homecomings, became "subrogated to all rights and remedies [Homecomings] would have had against any person or property…." First American then filed this lawsuit against appellants, the estate of another attorney, the escrow account, the non-lawyer who withdrew the funds from the escrow account, and others, seeking damages for legal malpractice and breach of a contract with Homecomings. The trial court denied summary judgment to appellants. The issue before the Supreme Court was whether a legal malpractice claims were not per se unassignable. After studying the issue, the Court agreed with the appellate court that legal malpractice claims are not per se unassignable. View "Villanueva v. First American Title Ins. Co." on Justia Law

Margaret Hunt, a teacher, sued her former employer, the Richmond County Board of Education for breach of her employment contract. The parties stipulated to the amount of damages, and after a bench trial, the trial court entered judgment in the stipulated amount plus prejudgment interest. The Board cut two checks, one reflecting the interest and fees, and another intended to reflect the damages award. The award was treated as wage income, with various sums withheld to comply with state and federal tax laws. Hunt objected to that treatment of the damages award, contending that the second check prepared by the Board should have been for the full amount of the damages, and that the payment should be reported for tax purposes using an IRS Form 1099. The parties could not agree on the tax treatment of the damages award. As a result, the Board filed suit seeking an injunction against Hunt in the event she resorted to certain collection methods (such as garnishment of the Board's assets). The superior court grated a temporary restraining order. Hunt appealed to the Supreme Court, and the Supreme Court reversed: "the mere apprehension of injury does not support the grant of an injunction." View "Hunt v. Richmond County Bd. of Education" on Justia Law

After Mack Pitts was killed in a construction accident at Hartsfield-Jackson Atlanta International Airport, his estate and minor children sued the City of Atlanta and several contractors for breaches of contracts concerning the construction project on which Pitts had been working. Although Pitts was not a party to these contracts, his estate and children asserted that he was an intended beneficiary and that they, therefore, had standing to sue for breach of the contracts. On cross-motions for summary judgment, the trial court found that Pitts was not an intended beneficiary, denied summary judgment to the estate and children, and awarded summary judgment to the City and contractors. The Court of Appeals reversed, concluding that the trial court should have awarded summary judgment on the claims for breach of contract to the estate and children, not to the City and contractors. The Court of Appeals determined that Pitts was, in fact, an intended beneficiary of the contracts, and it found that the evidence was undisputed that the City and contractors had breached the contracts. Upon review, the Supreme Court concluded that the Court of Appeals misapplied or failed to apply several fundamental principles of contract law in its consideration of these cases. Accordingly, the Court vacated the appellate court's decision and remanded the case for further proceedings. View "Holder Construction Company v. Estate of Pitts" on Justia Law

The Supreme Court granted certiorari to decide whether the appellate court correctly construed the standing requirement for a motor vehicle dealership to sue under OCGA 10-1-664 (the anti-encroachment provision of the Georgia Motor Vehicle Franchise Practices Act). "While the anti-encroachment provision could have been drafted more clearly, we believe that the Act as a whole, and particularly its definitions provision, OCGA 10-1-622, elucidate[s] the proper application of the anti-encroachment provision to the facts of this case." Though the Court disagreed with the rationale of the majority of the appellate panel, it concluded the panel reached the right result, and therefore affirmed the court of appeals' judgment. View "WMW, Inc v. American Honda Motor Company, Inc." on Justia Law

Appellant James Newman (husband) and appellee Judy Newman (wife) were married in May 2007. Just before their wedding, they executed a 20-page type-written prenuptial agreement to which they added a handwritten provision acknowledging "that there [were] certain ambiguities contained [within] the body of this document which each party agrees to clarify and re-write within 30 days of the date of execution hereof." Wife filed for divorce in 2011. After a hearing, the trial court granted wife's motion to enforce the prenuptial agreement and entered a judgment of divorce incorporating its terms. The Supreme Court granted husband's application for discretionary appeal and affirmed the trial court's judgment: "[i]n essence, husband argue[d] that any agreement the parties may have had was voided by the addition of the language indicating their belief that the agreement contained ambiguities and their intent to clarify such ambiguities. Because the language of the prenuptial agreement demonstrate[d] the parties reached a complete agreement regarding the disposition of property in the event their marriage ended in divorce, we conclude the trial court did not err by granting wife's motion to enforce the agreement and incorporating the agreement into the final divorce decree." View "Newman v. Newman" on Justia Law