Justia Contracts Opinion Summaries

The Supreme Court vacated in part the judgment of the Court of Appeals upholding a jury verdict against Appellants in the amount of $1,308,403 in compensatory damages and $2,686,000 in punitive damages, holding that the award of punitive damages, for what was essentially a breach of contract, was improper.The jury verdict arose from an action brought by Appellees asserting that Appellant violated its contractual obligations by fraudulently underpaying royalties owed under leases governing Appellants’ extraction of natural gas from Appellees’ land. Appellees brought its claim for unpaid royalties under breach of contract and fraudulent misrepresentation theories. The Supreme Court held (1) the award of punitive damages was improper; (2) the award of compensatory damages as determined by the trial court and jury was proper; and (3) Appellants’ post-verdict motions were timely made, no errors committed during trial warranted a new trial, and the trial court did not err in denying Appellees’ motion to amend the complaint. View "Nami Resources Co., LLC v. Asher Land & Mineral, Ltd." on Justia Law

The Supreme Court reversed the grant of summary judgment in favor of Defendant on Plaintiff’s complaint, holding that Plaintiff presented a genuine issue of material fact as to his breach of contract claim.Plaintiff brought claims against Defendant, his former employer, for breach of contract, quantum meruit, unjust enrichment, conversion, and fraud. The trial court granted Defendant’s motion for summary judgment on the issue of conversion and denied the motion as to the remaining issues. Upon reconsideration, the trial court vacated its original opinion and order, holding that Defendant was entitled to summary judgment as a matter of law on all claims. The court of appeals reversed. The Supreme Court affirmed and remanded this case to the trial court for further factual determinations regarding the alleged breach of contract, holding that the parties formed a valid contract, and there were sufficient genuine issues of material fact for Plaintiff to withstand a motion for summary judgment. View "Baumann Paper Co., Inc. v. Holland" on Justia Law

The Court of Appeals correctly applied the principles of Cincinnati Insurance Co. v. Motorist Mutual Insurance Co., 306 S.W.3d 69 (Ky. 2010), to hold that a contractor’s faulty workmanship on the basement and foundation of an existing structure, which resulted in extensive damage to the entire building, was not an accident triggering coverage as an occurrence under the contractor’s commercial general liability (CGL) insurance policy.The policy provided that the insurer (Insurer) would pay for property damage if it resulted from an “occurrence.” The trial court ruled that Plaintiff could recover from Insurer under the policy for the damage to the structure above the basement level because the damage was an unexpected and unintended consequence of the contractor’s faulty work on the basement. The court of appeals reversed, ruling that none of the structural damage qualified as an accident triggering coverage as an occurrence under Insurer’s CGL policy. The Supreme Court affirmed, holding that the trial court failed to focus on the proper elements from Cincinnati. View "Martin/Elias Properties, LLC v. Acuity, a Mutual Insurance Co." on Justia Law

The Supreme Court reversed the judgment of the court of appeals reversing the circuit court’s entry of a declaratory judgment in favor of Big Sandy Company, LP, interpreting a pipeline easement agreement (the Agreement) in Big Sandy’s favor.In 2003, Big Sandy entered into the Agreement with Kentucky West Virginia Gas Company, LLC (KWVA), the predecessor in interest of EQT Gathering, LLC and EQT Production Company (collectively, EQT). EQT filed suit against Big Sandy requesting declaratory relief regarding the interpretation and scope of the Agreement. The trial court concluded that Big Sandy’s interpretation prevailed. The court of appeals reversed, holding that Big Sandy’s interpretation would be absurd and render much of the Agreement meaningless. The Supreme court reversed, holding that the trial court properly interpreted the Agreement. View "Big Sandy Co., L.P. v. EQT Gathering, LLC" on Justia Law

In this construction dispute, Plaintiff was not entitled to relief on its breach of contract claim or under a quantum meruit theory.Plaintiff and Defendant entered into a subcontract agreement that outlined services that Plaintiff was to perform as a subcontractor for the construction of the Bridge Street Bridge. Plaintiff later sued Defendant for breach of contract and quantum meruit in the alternative, asserting that the parties had entered into a separate agreement before the subcontract agreement and that, under that alleged agreement, Defendant was obligated to pay for additional work performed. The circuit court granted Defendant’s motion for judgment for the pleadings, concluding that the subcontract agreement was a complete integration of the dealings between the parties. The court of appeals determined that it was unclear whether the subcontract agreement was a full integration or a partial integration. Thus, the court declared that whether any additional work Plaintiff allegedly performed was covered by the subcontract agreement was an issue of fact for the jury. The Supreme Court reversed, holding (1) by its own terms, the subcontract agreement was a full integration of the parties’ contract for Plaintiff’s subcontracting work on the bridge; and (2) Plaintiff was not entitled to relief under a quantum meruit theory. View "Vanhook Enterprises, Inc. v. Kay & Kay Contracting, LLC" on Justia Law

In this construction dispute, Plaintiff was not entitled to relief on its breach of contract claim or under a quantum meruit theory.Plaintiff and Defendant entered into a subcontract agreement that outlined services that Plaintiff was to perform as a subcontractor for the construction of the Bridge Street Bridge. Plaintiff later sued Defendant for breach of contract and quantum meruit in the alternative, asserting that the parties had entered into a separate agreement before the subcontract agreement and that, under that alleged agreement, Defendant was obligated to pay for additional work performed. The circuit court granted Defendant’s motion for judgment for the pleadings, concluding that the subcontract agreement was a complete integration of the dealings between the parties. The court of appeals determined that it was unclear whether the subcontract agreement was a full integration or a partial integration. Thus, the court declared that whether any additional work Plaintiff allegedly performed was covered by the subcontract agreement was an issue of fact for the jury. The Supreme Court reversed, holding (1) by its own terms, the subcontract agreement was a full integration of the parties’ contract for Plaintiff’s subcontracting work on the bridge; and (2) Plaintiff was not entitled to relief under a quantum meruit theory. View "Vanhook Enterprises, Inc. v. Kay & Kay Contracting, LLC" on Justia Law

The Supreme Court affirmed in part and reversed in part the judgment of the court of appeals reversing the judgment of the trial court in this action arising from a construction dispute.Two subcontractors - the steel fabricator and the steel erector and installer - on a condominium project brought suit against the project owner, developer, and general contractor after the subcontractors proceeded with extra work outside the scope of the original bid documents but were never paid for either that work or the retainage amount owed under the steel fabricator’s contract with the general contractor. The circuit court entered judgment in favor of Plaintiff for the cost of the extra work and unpaid retainage. The general contractor prevailed on its indemnification cross-claim against the other two defendants and on the negligence cross-claim asserted against it by the other two defendants. The court of appeals reversed. The Supreme Court held that the court of appeals (1) erred by reversing the trial court’s judgment against the owner for unjust enrichment; (2) properly reversed the trial court’s judgment against the general contractor for breach of contract; and (3) properly found that the trial court should have instructed the jury on the owner and developer’s breach of contract claim but erred in finding the negligence instruction deficient. View "Superior Steel, Inc. v. Ascent at Roebling’s Bridge, LLC" on Justia Law

The Supreme Court affirmed the decisions of the lower courts in this action brought by Janet Cropper against her former employers - the Roman Catholic Diocese of Covington, Saint Augustine School, and the pastor of the Saint Augustine Church (collectively, Saint Augustine) - claiming damages for, inter alia, breach of her employment contract, holding that the trial court and court of appeals did not err when they ruled that Cropper was not barred from asserting her breach of contract claim. The trial court ruled that Cropper’s claims were not barred by the ecclesiastical-abstention doctrine but ultimately ruled that, as a matter of law, Cropper could not show a breach of her employment contract. The court of appeals reversed the trial court’s determination that Cropper could not prove a breach of contract. The Supreme Court affirmed the result reached by the court of appeals and remanded for further proceedings, holding that the ecclesiastical abstention doctrine did not apply to the facts of this case. View "Saint Augustine School v. Cropper" on Justia Law

The Supreme Court affirmed the decision of the court of appeals affirming the order of the circuit court denying the University of Louisville’s (U of L) immunity against suit in this case. After Mark Rothstein’s Distinguished University Scholar (DUS) contract was terminated, Rothstein filed suit against U of L for breach of a written contract. The circuit court denied U of L’s argument that sovereign immunity barred Rothstein’s claims for breach of the written contract, finding instead that Ky. Rev. Stat. 45A, which waives immunity for breach of contract actions against the Commonwealth, was applicable to written employment contracts. The court of appeals affirmed. The Supreme Court affirmed, holding that the legislature has waived immunity for all claims arising out of lawfully authorized written contracts with the Commonwealth and its agencies. View "University of Louisville v. Rothstein" on Justia Law

The Supreme Court vacated the opinion of the court of appeals ruling that the circuit court prematurely granted specific performance of an option contract because disputed issues of fact material to that form of relief had been left unresolved in the circuit court. The circuit court granted the motion for specific performance of a real estate option contract between AEP Industries, Inc. (AEP) and B.G. Properties, Inc. (BG). The court of appeals determined that the circuit court had not adequately addressed the threshold issue of whether, as alleged by BG, AEP had first violated the option agreement with a faulty appraisal and thus was barred from seeking specific performance. The Supreme Court reversed, holding that BG’s execution and delivery of a general warranty deed without an express reservation of rights and its acceptance of stated consideration for the transfer precluded its further challenge to the enforcement of the option agreement. View "AEP Industries, Inc. v. B.G. Properties, Inc." on Justia Law