Justia Contracts Opinion Summaries

Dawn Osborne appealed a district court's order granting Brown & Saenger, Inc.'s motion to dismiss for improper venue. In 2011, Brown hired Osborne as a sales representative in its Fargo office to sell office supplies to businesses. Brown was headquartered in South Dakota, but operated as a foreign business corporation in North Dakota. Osborne signed yearly employment contracts with Brown. The parties agreed that the 2015 Employment Agreement was the controlling contract for this action, and it was the only one brought before the district court. The two clauses at issue in deciding the motion to dismiss were the "Agreement Not to Compete" ("non-compete clause") and the "Choice of Law/Forum" clauses. In January 2017, Brown terminated Osborne. Osborne sued Brown, alleging retaliation, improper deductions, and breach of contract. Osborne also sought a declaratory judgment declaring the non-compete clause to be void. Osborne moved for a preliminary injunction seeking to prevent Brown from enforcing the covenant-not-to-compete against her. Brown responded to that motion and moved to dismiss the action for improper venue. Brown argued the forum-selection clause in the employment agreement was valid and therefore a North Dakota court was an improper venue. Brown argued that the clause required the case to be heard by the South Dakota court specified in the agreement. The district court, without ruling on the motion for preliminary injunction, agreed with Brown and granted the motion to dismiss. Additionally, Brown sued Osborne in the state circuit court situated in Minnehaha County, South Dakota, seeking a preliminary injunction against Osborne restricting her actions under the non-compete clause. The North Dakota Supreme Court reversed under N.D.C.C. 28-04.1-03(5), concluding the forum-selection clause in the parties' employment agreement violated North Dakota's public policy against non-compete agreements. The non-compete clause was unenforceable under N.D.C.C. 9-08-06 to the extent it limited Osborne from exercising a lawful profession, trade, or business in North Dakota. View "Osborne v. Brown & Saenger, Inc." on Justia Law

Indiana law previously provided that, when school districts needed to reduce their teaching staffs, tenured teachers that were qualified for an available position had a right to be retained over non-tenured teachers. A 2012 amendment eliminated that right and orders school districts to base layoff choices on performance reviews without regard for tenure status. Madison Consolidated Schools relied on the new law to lay off Elliott, a teacher who earned tenure 14 years before the new law took effect, while it retained non-tenured teachers in positions for which Elliott was qualified. Elliott, who had been elected as president of his union, sued, claiming that the amendment violated the Contract Clause when applied to him. The Seventh Circuit affirmed summary judgment in Elliott’s favor. The statute, not the annual contracts, granted Elliott his contractual tenure rights, which became enforceable the year Elliott earned tenure. A decrease in job security necessarily impairs his rights under that contract. The change substantially disrupted teachers’ important and reasonable reliance interests. Improving teacher quality and public-education outcomes are important public interests of the highest order but even important goals and good intentions do not justify this substantial impairment of the tenure contract for already-tenured teachers. View "Elliott v. Board of School Trustees of Madison Consolidated Schools" on Justia Law

For almost 40 years, Honeywell (or its predecessors) operated a manufacturing plant in Fostoria, Ohio. Many union workers, including Watkins and Ulicny, spent most of their working years at the plant. They retired at a time when Honeywell promised in a collective-bargaining agreement that it would pay for their health insurance. When the final agreement expired in 2011, Honeywell did not renew it. It sold the plant and, later, stopped paying for its retirees’ healthcare. Those retirees filed suit. The district court found that Honeywell’s promise to pay for healthcare ended when the agreement expired and dismissed the suit. The Sixth Circuit affirmed. The agreement promises healthcare “for the duration of this Agreement,” and “this promise means exactly that: Honeywell’s obligation to pay for its Fostoria retirees’ healthcare ended when the agreement expired.” View "Watkins v. Honeywell International, Inc." on Justia Law

Jami Johnston appealed a judgment entered in favor of Castles and Crowns, Inc. ("Castles"). Castles was a children's clothing company formed by Julie Vickers and Amy Bowers. Brandi Stuart, Johnston's sister, worked for Castles from 2006 until 2011. From 2009 to 2010, while she was working with Castles, Stuart had 7,149 pounds of Castles' clothing shipped either to Johnston or to consignment companies used by Johnston. In January 2011, Vickers terminated Stuart's employment based on issues with her performance. In April 2011, Castles sued Stuart and Johnston, alleging conversion; civil conspiracy; "willfulness, negligence, and wantonness"; trespass to chattel; and unjust-enrichment against Johnston and Stuart. It also asserted fraudulent-misrepresentation and suppression claims against Stuart. Johnston answered, also asserting a counterclaim against Castles and a third-party complaint against Vickers. In her counterclaim and third-party complaint, Johnston alleged claims of defamation; "negligence, wantonness, and willfulness"; conspiracy; and tortious interference with business and contractual relations. She also sought recovery against Castles under the theory of respondeat superior. In this case, the trial court instructed the jury to consider Castles' unjust-enrichment claim against Johnston if it did not find against Johnston on the conversion and conspiracy claims. The jury found against Johnston on both the conversion and conspiracy claims. However, it then considered the unjust-enrichment claim and found against Johnston on that claim as well. The Alabama Supreme Court concluded the jury's verdict was inconsistent with the trial court's instructions and "was obviously the result of confusion on the part of the jury." After it had discharged the jury, the trial court acknowledged the inconsistency in the jury's verdict. The trial court attempted to cure that inconsistency by setting aside the award in favor of Castles on the unjust-enrichment claim. However, the Supreme Court found the trial court's attempt to reconcile the inconsistency in the jury's verdict was based on mere speculation about the jury's intent. Additionally, the jury failed to follow the trial court's instructions, and Johnston moved for a new trial on that ground. The Supreme Court concluded Johnston was entitled to a new trial because the jury failed to follow the trial court's instructions. For these reasons, the trial court erred when it denied Johnston's motion for a new trial. View "Johnston v. Castles & Crowns, Inc." 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

Baxter sued her former employer, Genworth, for wrongful termination and related causes of action, based on discrimination and retaliation, arising out of her employment. Genworth moved to compel arbitration as part of Genworth’s Resolve Employee Issue Resolution Program, which consists four stages, The trial court concluded, and the court of appeal affirmed, that the arbitration agreement Baxter signed in 2006, as a condition of continued employment, is unconscionable, refusing to sever any provisions. Agreement as a condition of continued employment amounted to “modest procedural unconscionability.” The court concluded that several features of the agreement were substantively unconscionable: default discovery limitations, a prohibition against contacting witnesses, procedural deadlines that effectively shorten the statute of limitations and preclude a meaningful opportunity for a pre-litigation Fair Employment and Housing Act investigation, and accelerated hearing procedures that infringe upon an employee’s ability to adequately present his or her case. The severance of the offending provisions was not an option because the arbitration agreement is permeated by unconscionability. View "Baxter v. Genworth North America Corp." on Justia Law

Linton drove DeSoto taxicabs, 2008-2012, after submitting his social security number, proof that he was eligible to work in the U.S., his driver’s license, and a DMV printout. Linton signed DeSoto’s 15-page Lease without negotiating any terms. The Agreement disclaims any employment relationship. Either party could cancel with 30 days’ notice, or without notice in the event of a breach. Linton provided a $500 security deposit and attended an orientation. Drivers keep the fares and tips that they receive and pay DeSoto a gate fee of about $100 per day. DeSoto does not require drivers to check in during their shifts but the cabs are equipped with GPS tracking and have recording devices. Linton received a notice of termination after he was accused of obtaining a passenger’s credit card information and making repeated charges on her account. Linton filed a claim with the Labor Commissioner, contending that he had been misclassified as an independent contractor instead of as an employee. The Labor Commissioner concluded that Linton was an employee and assessed wages, interest, and penalties Labor Code 221, 98.1(c), and 203. A trial court concluded Linton was an independent contractor. The court of appeal reversed. The trial court failed to apply a presumption in favor of employment, misapplied precedent, and made “questionable” distinctions in analyzing the facts. View "Linton v. DeSoto Cab Co." on Justia Law

Vallejo filed a petition for bankruptcy relief in 2008. Under its existing labor agreement with the Vallejo Police Officers Association (VPOA), the city paid the full premium cost for retirees and employees of any medical plan offered through the California Public Employees’ Retirement System (CalPERS or PERS) and paid the full premium for other city retirees, so it was subject to the Public Employees’ Medical and Hospital Care Act, Gov. Code, 22750. PEMHCA establishes a minimum level of employer contribution toward medical premiums. The city sought approval from the bankruptcy court to reject its labor agreements. While the motion was pending, VPOA and the city reached an agreement and the city voluntarily dismissed its motion to reject as to the VPOA. Under the 2009 Agreement, health insurance benefits were reduced. After months of negotiations toward a superseding agreement, the city declared an impasse in 2013. VPOA filed suit, alleging that the city was not bargaining in good faith, in violation of the Meyers-Milias-Brown Act, Gov. Code, 3500. The court of appeal affirmed the denial of the petition. VPOA did not show its members had a vested right to a full premium; substantial evidence supported findings that the city did not engage in surface bargaining or rush to declare an impasse. View "Vallejo Police Officers Association v. City of Vallejo" on Justia Law

Appellant Patrick O’Connor appealed the grant of summary judgment to Appellees Fulton County and its County Manager, Richard Anderson, on his claims for breach of contract, mandamus relief, and attorney fees. O’Connor was hired in 1996 as the CFO/Finance Director for Fulton County. O’Connor was an unclassified, at-will employee, and, though the Finance Director position was originally an “on-range position” (i.e., one that is on a pay scale), it was later changed to a set-rate position, which has a salary specifically approved by either the County Manager or the Fulton County Board of Commissioners (“the Board”). In October 2014, the Board appointed O’Connor as Interim County Manager. Just a few months later, however, O’Connor was removed from that position and given the option to resign as Finance Director or be fired; O’Connor refused to resign, and the Board terminated his employment. The trial court granted summary judgment to Appellees, concluding that the personnel regulations did not create an employment contract and that, even if they had, Personnel Regulation 300-4 (7) did not apply to O’Connor. The trial court also concluded that, because O’Connor could not prevail on his underlying breach-of-contract claim, he was not entitled to mandamus relief or attorney fees. Finding no reversible error in the trial court’s judgment, the Georgia Supreme Court affirmed. View "O'Connor v. Fulton County" on Justia Law

Zuber, employed by Boscov’s at Fairgrounds Farmers’ Market in Reading, Pennsylvania, suffered an injury at work, immediately filed a workers’ compensation claim, and received work leave. About two weeks after Zuber returned to work, Boscov’s fired Zuber, Months later, Boscov’s and Zuber signed a Compromise and Release Agreement before the Pennsylvania Department of Labor and Industry Workers’ Compensation Office. Zuber later sued under the Family and Medical Leave Act, 29 U.S.C. 2617, and common law, claiming that Boscov’s failed to notify him of his FMLA rights and to designate his leave as FMLA protected; retaliated against him for exercising his FMLA rights; and retaliated against him for filing a workers’ compensation claim. The district court dismissed, based on a release provision in the Agreement. The Third Circuit reversed, based on the Agreement’s references to “benefits” and “monies of any kind,” “in connection with the alleged 8/12/2015 [sic] work injury claim as well as any other work injury claim(s).” Zuber seeks benefits and monies from FMLA and common law claims, not from matters related to the injury. View "Zuber v. Boscov's, Inc." on Justia Law