Articles Posted in Kansas Supreme Court

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In this case construing the full-performance exception to the statute of frauds, Kan. Stat. Ann. 33-101 et seq., the Supreme Court adopted the rule set forth in Restatement (Second) of Contracts, 130, holding that full performance by one party alone is sufficient to remove an agreement from the statute and allows the performing party to enforce the agreement in a court of law. Three employees asked the Supreme Court to enforce their oral agreement with their former employer, arguing that they fully performed their obligation under the agreement and were owed the compensation they bargained for. The court of appeals ruled in favor of the former employer, concluding that the former employer’s duty to pay depended on the action of third parties. The Supreme Court reversed, holding (1) the court of appeals erroneously construed the full-performance exception; and (2) because the employees completed their employment and fulfilled their end of the bargain, the full-performance exception applied and the alleged oral agreement was removed from the statute of frauds. View "Ed DeWitte Insurance Agency v. Financial Associates Midwest" on Justia Law

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The Supreme Court reversed the decision of the court of appeals reversing the district court’s grant of summary judgment for Defendants in this contract dispute, holding that the district court correctly found that the contract at issue violated the corporate practice of medicine doctrine and was therefore unenforceable. Central Kansas Medical Center (CKMC) contracted with Dr. Stanley Hatesohl to provide family medicine services. The contract contained several postemployment covenants. Two years later, Plaintiff resigned and began practice family medicine at Great Bend Regional Hospital’s (GBRH) Central Kansas Family Practice (CKFP) clinic. CKMC sued Hatesohl for violating the postemployment covenants and GBRH and CKFP for tortiously interfering with the contract. The district court granted summary judgment for Defendants on the basis of the corporate practice of medicine doctrine, which forbids a corporation from hiring a physician to practice medicine that the corporation itself is not licensed to provide. The court of appeals reversed. The Supreme Court reversed, holding that the contract between Hatesohl and CKMC violated the corporate practice of medicine doctrine. View "Central Kansas Medical Center v. Hatesohl" on Justia Law

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At issue was a real estate contract containing a “first right of refusal” applicable to a separate land tract. Appellant sought specific performance and title to a smaller parcel that was sold after he failed to respond to an earlier offer to sell the entire tract subject to the real estate contract. The district court granted summary judgment for Defendants. A Court of Appeals panel reversed. Defendants petitioned for review solely on the panel’s contractual compliance analysis. The Supreme Court affirmed, holding (1) the panel both misread the contract and improperly inserted terms inconsistent with the plain language under consideration; but (2) the first right of refusal was fulfilled after Appellant failed to respond to the offer to sell him the full tract subject to the contract. The Court remanded the case for further proceedings where there remained an unresolved claim as to whether the parties discharged their implied duty of good faith and fair dealing when the offer was presented, and the answer to this question will determine whether the first right of refusal provision lapsed when Appellant failed to respond. View "Trear v. Chamberlain" on Justia Law

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Mahnaz Consolver hired attorney Bradley Pistotnik to represent her in her personal injury lawsuit. Consolver terminated Pistotnik without cause just before settlement. Thereafter, Consolver hired Stephen Brave, who settled the case for $360,000. The district court concluded that Pistotnik was entitled to a fee in the amount of nearly $87,000 and expenses of approximately $10,000. The court of appeals reversed, finding that the district court “stepped outside the legal principles guiding quantum meruit to premise the fee award to Pistotnik on the contingency percentage in the parties’ contract." The Supreme Court reversed, holding that the district court did not abuse its discretion when it determined the reasonable value of Pistotnik’s services by considering, in part, the terms of the contingency fee agreement between Pistotnik and Consolver. View "Consolver v. Hotze" on Justia Law

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In 2003, Mid America Ag Network, Inc. (MAAN, Inc.) and Journal Broadcast Group of Kansas, Inc. (JBGK) entered into a settlement agreement governing dealings between the companies. The agreement contained a clause stating that neither party shall assign the agreement without prior written consent of the other party. In 2005, MAAN, Inc. allegedly sold the agreement and its right to do business under the MAAN name to Steckline Communications, Inc. (SCI) without JBGK’s consent. SCI and JBGK continued to do business with each other pursuant to the agreement’s terms until 2012. That year SCI sued JBGK for breaching the agreement. The district court dismissed the suit on the grounds that SCI lacked standing because it was not a party to the contract. The Supreme Court reversed, holding that the district court erred in granting JBGK’s motion to dismiss because SCI set forth a colorable claim that JBGK was equitably estopped from asserting that SCI lacked standing on the grounds of an inadequate assignment. Remanded. View "Steckline Communications, Inc. v. Journal Broadcast Group of Kansas, Inc." on Justia Law

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Prairie Land Electric Cooperative, Inc. (Prairie Land), which purchases wholesale electricity from various suppliers and distributes that electricity to retail customers, entered into temporally overlapping, long-term all-requirements contracts with two different wholesale electricity suppliers, Sunflower Electric Power Corporation (Sunflower) and Kansas Electric Power Cooperative, Inc. (KEPCo). After a dispute arose regarding which supplier had the right to serve a certain pumping station delivery point, Prairie Land filed a petition for declaratory judgment asking the district court to determine which supplier was entitled to serve the new delivery point. The district court ruled in favor of Sunflower, which entered into the first all-requirements contract with Prairie Land. The court of appeals reversed. The Supreme Court reversed the court of appeals’ decision and affirmed the district court’s judgment, holding that under the facts of this case, Prairie Land must meet its obligations under its contract with Sunflower, the first supplier, before it may comply with any obligations under its contract with KEPCo, the second supplier. View "Prairie Land Elec. Coop., Inc. v. Kan. Elec. Power Coop., Inc." on Justia Law

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Nationwide Mutual Insurance Company issued an automobile insurance policy, which included uninsured motorist coverage, to Melvin Briggs. After Nationwide sent Briggs a notice of nonrenewal of the policy, Briggs was involved in a collision with an uninsured motorist. Briggs's children filed a claim under the Nationwide policy for uninsured motorist benefits, which Nationwide denied. Nationwide subsequently sued Briggs’s children, seeking a declaratory judgment that it had nonrenewed Briggs’s policy before the automobile accident. The U.S. district court granted summary judgment for Nationwide, concluding that it had complied with statutory and policy requirements for notice of nonrenewal. On appeal, the Tenth Circuit Court of Appeals certified a question of law to the Kansas Supreme Court, which answered the certified question as follows: Notice to nonrenew an insurance policy that complies with the procedure set out in Kan. Stat. Ann. 40-3118(b) and a consistent provision in the policy itself is sufficient to force a lapse of coverage, regardless of whether a proper substantive basis for nonrenewal exists under Kan. Stat. Ann. 40-276a(a) and consistent policy language. View "Nationwide Mut. Ins. Co. v. Briggs" on Justia Law

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Iron Mound, LLC and ASC Group, LLC entered into an operating agreement for the creation of ASC Midwest, LLC. Neuterra Healthcare Management, LLC was the successor-in-interest to the ASC Group. After ASC Midwest was dissolved, Iron Mound brought this breach of contract action against Nueterra, alleging that under the operating agreement, Iron Mound was entitled to receive a percentage of the gross fees earned by Nueterra under a management agreement entered into after the operating agreement had expired. The district court granted summary judgment in favor of Nueterra. The court of appeals reversed. The Supreme Court reversed the court of appeals and affirmed the district court, holding that the unambiguous terms of the operating agreement rendered it inapplicable to the fees received by Nueterra under the management agreement. View "Iron Mound, LLC v. Nueterra Healthcare Mgmt., LLC" on Justia Law

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Thoroughbred Associates drilled a gas well (Well) in Comanche County. Thoroughbred subsequently acquired leases of land near the Well and created a unit called the Thoroughbred-Rietzke Unit (Rietzke Unit). Defendants became successors-in-interest to a lease (OXY Lease) Thoroughbred entered into for oil and gas underlying a tract near the Well. The parties disagreed, however, about whether the Well was draining the Rietzke Unit. Thoroughbred stopped submitting royalty payments to Defendants accruing from the Rietzke Unit. Thoroughbred subsequently filed a complaint for a declaratory judgment that it had been mistaken when it included the OXY Lease in the Rietzke Unit. Defendants counterclaimed. The district court concluded (1) Defendants failed to prove that any drainage of the leased lands occurred; and (2) the Lease was properly included in the Rietzke Unit. The Supreme Court affirmed in part and reversed in part, holding (1) Defendants failed to prove their drainage claim; and (2) the court of appeals erroneously granted summary judgment to Defendants on their claim that the Lease should be included in the Rietzke Unit. View "Thoroughbred Assocs., LLC v. Kansas City Royalty Co., LLC " on Justia Law

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The Rineharts contracted with Morton Buildings for a preengineered building to serve as their personal residence and business location for their business, Midwest Slitting. Upon disputes regarding the structure's quality, the Rineharts and Midwest Slitting sued. A jury found for the Rineharts on several of their claims and for Midwest Slitting on its negligent misrepresentation claim. The court of appeals affirmed and granted the Rineharts appellate attorney fees. Morton appealed, arguing that the economic loss doctrine, which originated with product liability litigation to prohibit tort claims when the only damages were to the product itself, should extend to bar the negligent misrepresentation claim in this case. The Supreme Court (1) affirmed the judgment in favor of Midwest Slitting on its negligent misrepresentation claims, holding that the economic loss doctrine does not bar negligent misrepresentation claims because the duty at issue arises by operation of law, and the doctrine's purposes would not be further by extending it to such claims; and (2) reversed the appellate attorney fee award because the Court could not determine from the record whether the court of appeals included time and expenses in the award not reimbursable under the applicable statute. Remanded. View "Rinehart v. Morton Bldgs., Inc." on Justia Law