Justia Contracts Opinion Summaries

This suit was filed by a daughter against an organ donation charity when she discovered that the charity - contrary to an earlier representation to her - would allegedly profit from harvesting her deceased mother's tissues. The charity requested a defense from its insurer, and the insurer denied a defense. The insurer's subsequent suit against the charity resulted in two certified questions from the Fifth Circuit Court of Appeals. The Supreme Court held (1) the insurance policy provision for coverage of "personal injury" does not include coverage for mental anguish, unrelated to physical damage to or disease of the daughter's body; and (2) the insurance policy provision for coverage of "property damages," does not include coverage for the underlying plaintiff's loss of use of her deceased mother's tissues, organs, bones, and body parts.

Petitioner Alohacare bid for a health and human services contract under Haw. Rev. Stat. 103F but was denied the contract by Respondent, the Department of Human Services. Petitioner protested and later appealed. The lower courts dismissed Petitioner's appeal for lack of jurisdiction, finding that Petitioner was not entitled to judicial review. The Supreme Court vacated the judgment of the lower courts, holding (1) Petitioner may not appeal the denial of a contract award by Respondent under the procedures set forth in Haw. Rev. Stat. 103D that afford judicial review for bidders denied protests; (2) however, chapter 103F does not prohibit judicial review of the administrative denial of such matters, and review may be afforded under Haw. Rev. Stat. 632; (3) review and denial of a bidder's protest by Respondent as the purchasing agency and subsequent denial of a request for reconsideration by the chief procurement officer housed in a different executive agency do not assuage separation of powers concerns because review is accomplished only in the executive branch of government; and (4) Petitioner was not denied due process or equal protection by chapter 103F, inasmuch as judicial review may be obtained by way of a declaratory judgment action. Remanded.

State Department of Education (DOE) issued a request for proposals to provide health and human services under contracts pursuant to Haw. Rev. Stat. 103F. After the DOE rejected the proposal of Petitioner Alaka'i Na Keiki, Inc., Petitioner brought an action against the DOE. The circuit court granted summary judgment in favor of the DOE. The intermediate court of appeals affirmed, concluding that chapter 103F does not allow for judicial review. The Supreme Court vacated the judgment of the lower courts, holding that the DOE's decisions to reject such proposals were subject to judicial review. The Court then held (1) as construed, chapter 103F was not unconstitutional for violating the separation of powers doctrine; (2) Petitioner's request for a declaratory judgment was moot to the extent the subject contracts had been awarded and their terms expired; (3) Petitioner's claim for negligence by the DOE was barred under the State Tort Liability Act; and (4) Petitioner's claim for injunctive relief, premised on the DOE's alleged faulty administration of the contract process, was moot inasmuch as the Court interpreted such process in chapter 103F as subject to judicial review. Remanded.

Plaintiffs, seeking to represent a class, alleged failure to compensate them for work performed during their meal break and before and after shifts, and for time spent attending training sessions, in violation of the Fair Labor Standards Act, 29 U.S.C. 206-207; the Employee Retirement Income Security Act, 29 U.S.C. 1059(a)(1), 1104(a)(1); and the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. 1962, 1964(c). The district court held that the FLSA claim was deficiently pled, and that this was fatal to the complaint because the ERISA and RICO claims were derivative of the FLSA claim. The court found the allegation of under-compensation insufficient, given the lack of any information on plaintiffs' approximate weekly wages and hours worked, or even an allegation that they had worked in excess of 40 hours in any workweek. The First Circuit vacated. The allegations were insufficient under the FLSA, but plaintiffs should be permitted to amend.

Appellants, three licensed clinic psychologists, were former partners of Great Falls Clinic, LLP, a general limited liability partnership comprised of medical professionals. The Clinic partners, including Appellants, signed a partnership agreement stating that a partner who separates from the partnership in compliance with the agreement's terms will receive a partnership interest subject to reduction for competing after withdrawal or retirement. Appellants subsequently separated from the Clinic and filed a declaratory judgment action when the Clinic refused to pay them their full partnership interest payments. At issue was whether the agreement's restriction, which applied to those engaged in the "practice of medicine," included partners who practiced psychology after separating from the Clinic. The district court granted summary judgment for the Clinic. The Supreme Court affirmed, holding that the district court did not err by (1) holding that the Appellants engage in the "practice of medicine" as used in the partnership agreement; and (2) concluding that the parties' intention regarding the term "practice of medicine" in the language of the agreement was to include the psychologists.

By their 1998 Primary Care Physician Agreement, the parties agreed that Dr. Sutter would provide primary care health services to members of Oxford's managed care network in exchange for predetermined reimbursement. They agreed to arbitrate any disputes. A dispute arose when Sutter accused Oxford of improperly denying, underpaying, and delaying reimbursement of physicians' claims. Sutter filed a complaint on behalf of himself and a class of health care providers, alleging breach of contract and other violations of New Jersey law. The state court granted Oxford’s motion to compel arbitration. The arbitrator determined that the agreement allowed for class arbitration. The arbitrator entered a Partial Final Class Determination Award. Oxford sought to vacate, arguing that the arbitrator disregarded the law by ordering class arbitration. The district court denied Oxford's motion and the Sixth Circuit affirmed. Arbitration proceeded on a classwide basis. Oxford later moved to vacated, based on the 2010 Supreme Court decision, Stolt-Nielsen S.A. v. AnimalFeeds International Corp. The district court denied the motion. The Third Circuit affirmed. The arbitrator endeavored to interpret the parties' agreement within the bounds of the law and his interpretation was not irrational. Nothing more is required under the Federal Arbitration Act.

Plaintiff-Appellant Sean Weeks appealed a summary judgment that dismissed his claims against Michael Geiermann and Collection Center, Inc. (collectively "Collection Center") for violations of the Fair Debt Collection Practices Act. In 2009, Plaintiff brought this action against the Center for its attempt to collect $3,034.21 in interest on a debt he owed to Medcenter One for clinic and hospital services. Plaintiff obtained medical services from Medcenter's clinic and hospital. According to billing records for the clinic, Plaintiff received services between 2002 and 2008 and was billed $6,752.46, of which his insurance paid $4,698.72. After an insurance adjustment of $1,427.26, Weeks was responsible for $626.48. Weeks paid $453.40, and after another adjustment of $2.03, $171.05 remained unpaid. In July 2009, attorney Geiermann on behalf of Collection Center sent Plaintiff a letter, demanding payment to the hospital for $4,481.22 and to the clinic for $171.05. The letter also demanded $3,003.28 in interest for the hospital and $30.93 in interest for the clinic. The district court granted Collection Center's summary judgment motion and dismissed Plaintiff's action, stating the case was "fairly straightforward." The court held there was no disagreement that Plaintiff had incurred a debt to Medcenter for medical services that remained unpaid which constituted a "legal indebtedness." The court further held that, according to Plaintiff's affidavit, he never received anything in writing from Medcenter indicating any interest would be assessed in the event of nonpayment of this debt after a specified period of time. The court concluded "as a matter of law, that [Collection Center was] rightfully entitled to collect interest from Weeks at the rate of six percent (6%) per annum on the legal indebtedness owed by Weeks to [Collection Center], as the assignee of Medcenter One." Upon review, the Supreme Court affirmed, concluding that a "medical services provider," who does not make disclosures required under N.D.C.C. 13-01-15 to charge the "late payment charge" allowed under N.D.C.C. 13-01-14.1, is still entitled to prejudgment interest under N.D.C.C. 47-14-05 at the legal rate of six percent per annum.

After an inspection revealed deplorable health conditions for its residents, an intermediate care facility for the developmentally disabled was decertified for Medicaid reimbursement. As a result, until the State appointed a receiver nine months later, the facility operated without receiving federal or state funds. This case was a common-law claim for expenses the facility laid out in the meantime for the individuals still residing there. The trial court denied the facility restitution for the unpaid months under a theory of quantum meruit, afforded relief under related breach of contract claims, but offset that judgment by the amount the State paid for its receiver. The Supreme Court affirmed the trial court's ultimate judgment, which resulted in neither party taking anything from the action, holding (1) the facility exhausted its administrative remedies; (2) the facility's quantum meruit claim failed; and (3) the state was entitled to set off the amount owed to the facility on the breach of contract claim against the amount the State paid in operating the receivership of the facility and which the facility then owed.

Plaintiff-Counterdefendant-Appellant David Oakes, M.D. was employed as a cardiologist by Defendant-Counterclaimant-Respondent Boise Heart Clinic Physicians, PLLC (BHC) from January 2000 until the end of July 2008, when he left to pursue other employment opportunities. While employed by BHC, Plaintiff had an employment agreement that entitled him to half the adjusted gross charges he generated. Because of his complicated arrangements with other service providers, Plaintiff's final payment was not calculated until after his departure. After his employment ended, Plaintiff corresponded with BHC regarding his final payment. Plaintiff never received payment. Instead, he received a series of letters that detailed the evolving computation of his final payment. BHC's last letter to Plaintiff included a demand for repayment. Plaintiff then sued claiming that BHC still owed him money under the employment agreement. In rendering its verdict, the jury was given a choice between three special verdict forms that corresponded with the three possible verdicts: one finding that neither party is entitled to recover from the other; one that finding that BHC owed money to Plaintiff; and one finding that Plaintiff owed money to BHC. The jury returned with a verdict in favor of Plaintiff, and against BHC, that awarded Plaintiff $2,043.92. Ultimately the district court entered a final judgment that awarded Plaintiff $2,043.92 and declared that neither party was the prevailing party for purposes of costs and attorney fees. Plaintiff appealed the "prevailing party" decision to the Supreme Court. e sought. The district court entered a judgment conferring to Oakes the amount awarded by the jury, but found that neither party was the prevailing party for purposes of costs or attorney fees. Upon review, the Supreme Court held that the district court abused its discretion by not finding Plaintiff to be the prevailing party. The case was remanded for a determination of costs and fees.

Jean Moreau & Associates brought this suit against the Health Center Commission for the County of Chesterfield (HCC), a municipal corporation, seeking a declaratory judgment and alleging claims for breach of contract and quantum meruit. The circuit court dismissed Jean Moreau's claims. The Supreme Court affirmed, holding (1) because Jean Moreau did not comply with the mandatory procedural requirements of the Virginia Public Procurement Act in bringing its breach of contract claim against HCC, the circuit court did not err in concluding that the claim was barred; and (2) the circuit court did not err in concluding that Jean Moreau's quantum meruit claim was barred by the doctrine of sovereign immunity for HCC's development and operation of Springdale, an independent living facility, because (i) municipal corporations performing governmental functions are immune from quantum meruit claims, (ii) HCC was not entitled to absolute immunity simply because it was created by a county and not a municipality, but (iii) Springdale served a governmental function.