Justia Contracts Opinion Summaries

Ronald Bacon was injured while working at a construction site. Bacon sued the general contractor, the general contractor's commercial liability insurer, the subcontractor, and the parent company of the subcontractor. Bacon settled with the insurer, which together with the general contractor's separate liability insurer, made payments to Bacon pursuant to the settlement agreement. After Bacon settled with the subcontractor's parent company, the general contractor's two insurers filed a breach of contract action because Bacon received the proceeds of his second settlement but refused to make payment to the insurers under the terms of the first settlement agreement. The district court granted summary judgment for the insurers, finding Bacon, his lawyer, and the lawyer's law firm liable in the amount of $437,500. The Supreme Court reversed the district court's finding that lawyer and law firm were personally liable on the contract, holding that an attorney and/or law firm is not liable on a contract negotiated on behalf of a client when the contract provides that both the client and the attorney "agree to and will pay" a certain sum of money and the attorney signs the contract under the legend "Agreed to in Form & Substance". The Court otherwise affirmed.

Coosa Cable Company, Inc. (Coosa Cable), sued Sycamore Management Group, LLC (Sycamore), and DirecPath, LLC (DirecPath). Coosa Cable sought and obtained both a temporary restraining order (TRO) and a preliminary injunction barring DirecPath from providing video-programming services to the tenants of an apartment building owned by Sycamore. As a condition of the TRO, Coosa Cable provided a security bond of $250. As a condition of the preliminary injunction, the trial court required Coosa Cable to provide a security bond of $100,000. After a hearing, the trial court entered a permanent injunction against Sycamore and DirecPath and discharged Coosa Cable's security bond. Sycamore and DirecPath appealed; the Supreme Court reversed the trial court's order granting permanent injunctive relief to Coosa Cable. Sycamore and DirecPath then sought to recover costs, damages, and attorney fees caused by the wrongful injunction, but the trial court denied their motion. Upon review, the Supreme Court reversed and remanded the trial court's decision: "[the Court held] that after this Court held in [the first Sycamore case] that Sycamore and DirecPath had been wrongfully enjoined, they were entitled to seek an award from Coosa Cable of the damages caused by the wrongful injunction. Because the trial court erred in denying Sycamore and DirecPath damages for the wrongful injunction, we reverse the trial court's order denying their motion seeking those damages."

Cindy Tolle sued Peter Lev for damages for failing to transfer ownership of a cabin situated on land owned by the government in a national park. Tolle also sued Lev for tortious interference with a business relationship she claimed with an employer. The circuit granted granted summary judgment in favor of Lev on both claims. The Supreme Court affirmed in part and reversed in part, holding (1) the circuit court did not abuse its discretion in dismissing the tortious interference claim, but (2) the circuit court erred in granting summary judgment to Lev on the claim for damages for failure to transfer the cabin, as (i) the statute of frauds did not bar the claim because an email from Lev confirming his agreement to transfer ownership of the cabin to Tolle was a sufficient writing and because the cabin agreement was for the sale of personal property, not real estate, (ii) neither the doctrine of merger nor the integration clause defeated Tolle's claim to enforce the oral agreement, and (iii) the parol evidence rule did not bar Lev's email.

Appellees, members of the Barbee family, were involved in an automobile accident. Appellant, Nationwide Mutual Insurance Company, insured the automobile. The policy contained a provision that required an action for underinsured motorist coverage be brought against the insurer within three years of the date of the accident. After receiving a judgment against the tortfeasors and more than four years after the accident, the Barbees filed suit against Nationwide to recover the outstanding amounts on their judgments. Nationwide filed a motion for summary judgment, arguing that the Barbees' claims were barred for failure to bring the claims within the three-year period required by the policy's limitation period. The trial court denied the motion. The court of appeals affirmed. At issue on appeal was whether a conflict between Nationwide's limitation provision and other provisions in the policy, which required that proceeds from any other available insurance be exhausted, rendered the limitation provision unenforceable. The Supreme Court reversed, holding (1) the three-year limitation provision was unambiguous and enforceable, and (2) the provision did not conflict with co-existing policy provisions because exhaustion of the tortfeasor's liability limits was not a precondition to filing suit by the insured against his insurer within the limitation period.

These two consolidated appeals arose from the same underlying district court action in which the district court issued a final judgment against Appellants in consolidated civil cases alleging various tort, contract, and declaratory relief claims. Appellants filed a notice of appeal from the final judgment and paid the requisite filing fee. That appeal was docketed in the Supreme Court as docket number 55200. Docket number 55981 was an appeal from a subsequent award of attorney fees entered in the same district court case. Because the notice of appeal was not accompanied by the requisite filing fee, the Supreme Court dismissed the appeal. Docket number 56473 was an appeal from a subsequent order denying a motion to set aside the judgment entered in the same district court case underlying the previous two appeals. The Supreme Court dismissed that appeal for failure to pay the filing fee. Appellants submitted the instant motions for reconsideration in docket numbers 55981 and 56473, asking the Court to permit them to pay the fees necessary to reinstate the appeals. The Supreme Court denied the motions, stating that due to limited judicial resources, failure to pay the requisite fee in a timely matter will result in dismissal.

Sellers entered an alleged contract with Buyer for the sale of property. After the parties failed to complete the sale, Buyer sued Sellers, seeking specific performance of the alleged contract. Buyer filed an amended complaint that added as a defendant Attorney, who had served as counsel for Sellers in the failed transaction, alleging fraud and other tortious conduct. Attorney filed a motion to substitute the district court judge, which the district court denied after finding Attorney's motion was untimely. At issue on appeal was whether Attorney qualified as a third-party defendant who possessed an independent right of substitution as opposed to a subsequently joined defendant. The Supreme Court reversed, holding (1) Attorney and Buyer qualified as adverse parties, and therefore, Attorney was a third-party defendant; and (2) Attorney timely filed his motion of substitution. Remanded.

This appeal arose from the settlement of a class action where defendant paid substantial sums for res judicata protection from the claims of persons assertedly injured by the toxic emissions of an industrial plant. The monies were allocated among three subclasses, one of which was to receive medical monitoring. Upon the monitoring program's completion, substantial sums remained unused. The district court denied the settlement administrator's request to distribute the unused medical-monitoring funds to another subclass of persons suffering serious injuries. Instead, the district court repaired to the doctrine of cy pres and ordered that the money be given to three charities suggested by defendant and one selected by the district court. The court held that the district court abused its discretion by ordering a cy pres distribution in the teeth of the bargained-for-terms of the settlement agreement, which required residual funds to be distributed within the class. The court reversed the district court's order distributing the unused medical-monitoring funds to third-party charities and remanded with instructions that the district court order that the funds be distributed to the subclass comprising the most seriously injured class members.

This case stemmed from plaintiff's allegations that, while she was employed with defendant on one of its cruise ships, she was drugged by other employees, raped, and physically injured while she was unconscious, and when she reported to officials of the cruise line what had happened to her, they treated her with indifference and even hostility, failed to provide her with proper medical treatment on board, and interfered with her attempts to obtain medical treatment and counseling ashore. Plaintiff subsequently asserted five claims against defendant involving violations of the Jones Act, 46 U.S.C. 30104, or the general maritime law applicable to the Seaman's Wage Act, 46 U.S.C. 10313. Plaintiff's remaining five claims involved common law tort claims. At issue was whether plaintiff's claims fell within the scope of the arbitration clause in the crew agreement. The court held that the district court did not err in holding that Counts VI, VII, VIII, IX, and X of plaintiff's complaint did not fall within the scope of the arbitration provision where all five of these claims involved factual allegations about how the cruise line and its officials treated plaintiff after learning that she had been raped, including allegations that she was kept on the ship against her will, that she was prevented from getting medical attention off the ship, that her rape kit was destroyed in the incinerator, and that her confidentiality as a rape victim was intentionally violated. The court held, however, that the remaining five counts arose directly from her undisputed status as a "seaman" employed by defendant and fell within the scope of the arbitration provision. Therefore, the district court erred in denying defendant's motion to compel arbitration for Counts I, II, III, IV, and V.

Celeste Grynberg and her husband were co-owners of Grynberg Petroleum. Celeste filed a complaint for declaratory relief, breach of contract, unjust enrichment, and conversion against L&R Exploration Venture and numerous individuals and entities having an interest in the venture (collectively L&R), claiming that L&R owed her compensation for services Grynberg Petroleum provided to L&R and that she was entitled to payment of those amounts. The district court granted summary judgment for L&R and dismissed the complaint on the basis of res judicata, finding that Celeste was in privity with parties involved in prior litigation in Colorado and New York and her complaint involved the same subject matter and issues resolved in those proceedings. The Supreme Court affirmed, holding that Celeste was in privity with her husband, who was a party in the New York proceedings, as the assignee of his interest in L&R and with Grynberg Petroleum as the co-owner of the company and was bound by the prior rulings.

Plaintiffs, individual homeowners, sued defendants, some of the nation's largest housing developers, seeking damages, attorneys fees and costs, and the option to rescind their home purchases due to defendants' fraud, negligent misrepresentation, breach of implied covenant of good faith and fair dealing, and violations of California law. At issue was whether plaintiffs, who purchased homes in new developments, had standing to sue defendants for injuries allegedly caused by defendants' practice of marketing neighboring homes to individuals who presented a high risk of foreclosure and abandonment of their homes, financing those high-risk buyers, concealing that information, and misrepresenting the character of the neighborhoods. The court held that the district court erred in dismissing plaintiffs' overpayment and rescission claims for lack of Article III standing. The court also held that plaintiffs' decreased economic value and desirability were cognizable injuries. While the court agreed with the district court that, on the current record, plaintiffs have not established a sufficient causal connection between any decreased value and desirability and defendants' actions, plaintiffs should be permitted to amend their complaint and attach expert testimony on causation. Accordingly, the court reversed and remanded for further proceedings.