Justia Contracts Opinion Summaries

A home remodeling contractor (Contractor) received a demand for arbitration regarding allegedly defective work it performed on a remodeling project. Contractor's insurer (Insurer) accepted defense of the claim under a reservation of rights. The arbitrator issued an arbitration award in favor of the homeowners. When Insurer refused to pay the award, Contractor paid the homeowners and sued Insurer for indemnification under the policy. The district court granted Contractor's motion for summary judgment, concluding that a vague arbitration award made it impossible to determine whether the insurance policy covered any of the homeonwers' successful claims and was directly attributable to the inaction of the attorney appointed by Insurer to represent Contractor. The court of appeals reversed. The Supreme Court reversed, holding (1) a portion of the homeowners' claim may be covered under the policy; (2) Insurer was not vicariously liable of the absence of an explanation of the arbitration award; and (3) Insurer was directly liable to Contractor for the failure of the attorney to request an explanation of the arbitration award to determine what portion of the award, if any, was for the covered claim. Remanded. View "Remodeling Dimensions, Inc., v. Integrity Mut. Ins. Co." on Justia Law

At issue in this case was the scope of an appraisal clause in a fire and wind insurance policy, which provided that either party could demand an appraisal if the parties failed to agree on "the amount of loss." Insureds initiated a breach of contract action, arguing that the appraisal clause did not apply to their claim for damages because the parties disputed whether the damage was covered by the policy, not the cost of repairing the damage. The district court ordered the parties to participate in an appraisal process after determining that the amount of loss under the appraisal clause included a "causation element." The court of appeals reversed. The Supreme Court reversed, holding (1) the phrase "amount of loss," as it related to the authority of the appraiser under the policy, unambiguously permitted the appraiser to determine the cause of the loss; and (2) the appraiser must necessarily determine the cause of the loss as well as the amount necessary to repair the loss as an incidental step in the appraisal process in this case.

Tammy Pepper suffered injuries in a single-vehicle accident when she was struck by a pickup truck owned by her sister and driven by her stepfather. Pepper subsequently sought insurance benefits under three policies. First, Pepper sought and recovered liability benefits from her sister's insurer. Second, Pepper sought and recovered liability benefits from her stepfather's insurer, State Farm. Third, Pepper sought, but did not recover, underinsured motorist coverage under a separate State Farm policy held by her stepfather. State Farm denied that it owed Pepper underinsured motorist coverage under the stepfather's policy on the ground that the terms of that policy excluded the sister's truck from its definition of vehicles eligible for underinsured motorist coverage. The district court granted summary judgment to State Farm, concluding that the exclusion in the stepfather's policy was valid because the exclusion was designed to prevent coverage conversion. The court of appeals reversed. The Supreme Court reversed, holding that the district court was correct that Pepper was not entitled to UIM benefits in this case.

Respondents brought this action on behalf of themselves and others similarly situated against Philip Morris, alleging that Philip Morris's marketing of its cigarettes violated Minnesota's consumer protection statutes. Respondents asserted claims under Minn. Stat. 8.31(3a) and for common law fraud and unjust enrichment. The district court granted Respondents' motion to certify the class. Subsequently, the court granted summary judgment to Philip Morris on the consumer protection claims asserted under section 8.31(3a) and then dismissed the case. The court of appeals affirmed the class certification but reversed the grant of summary judgment and reinstated Respondents' section 8.31(3a) consumer protection claims. The Supreme Court reversed, holding (1) Respondents' consumer protection claims asserted under section 8.31(3a) were previously released; and (2) because all of Respondents' claims had been dismissed, the issue of whether the plaintiff class was properly certified was moot.

Appellants, Leland and Ilene Haugen and Haugen Nutrition and Equipment, defaulted on promissory notes held by respondent United Prairie Bank-Mountain Lake (UPB). The various loan agreements between the parties contained provisions in which Appellants agreed to pay UPB's reasonable costs and attorney fees associated with the protection of UPB's security interests and the enforcement of Appellants' obligation to repay the loans. The district court denied Appellants' motion to submit the question of reasonable attorney fees to the jury and subsequently awarded UPB over $400,000 in attorney fees. The court of appeals affirmed, holding that UPB's claim for the recovery of attorney fees was equitable in nature and thus did not give rise to a jury trial right under the Minnesota Constitution. The Supreme Court reversed in part, holding that Appellants were constitutionally entitled to a jury determination on UPB's claim for attorney fees because the nature of the claim was contractual and the remedy sought was legal.

In 2004, Doctor informed Employer, a medical clinic, that he planned to exercise his rights under Employer's policy that rewarded length of service by giving benefits to physicians who were sixty years old or older and had at least fifteen years of taking night calls. Doctor agreed to postpone exercising his rights under the policy until the next year. In 2005, Employer told Doctor that the policy no longer existed. Doctor later withdrew from taking night call. As a result, Employer reduced Doctor's salary. In 2009, sued Employer for breach of contract and promissory estoppel, claiming Employer breached the policy by refusing to allow him to be exempt from night call without salary reduction. The district court granted Employer's motion to dismiss, holding that the two-year statute of limitations began to run in 2005 when Employer informed Doctor it would not honor its obligations under the policy. The court of appeals reversed, concluding that a new cause of action accrued each time a payment was due but not paid. The Supreme Court reversed, holding that Doctor's cause of action accrued, and the statute of limitations began to run, in 2005, and therefore, Doctor's claim was barred by the statute of limitations.

This case arose out of the 2007 collapse of the Interstate 35W Bridge. Individual plaintiffs commenced lawsuits against two contractors that performed work on the bridge pursuant to contracts entered into with the State. The contractors brought third-party complaints against Jacobs Engineering Group on the basis that Jacobs' predecessor negligently designed the bridge. One contractor also filed a third-party complaint against the State. The State cross-claimed against Jacobs for contribution, indemnity, and statutory reimbursement. Jacobs moved to dismiss the State's cross-claim as time-barred, arguing that the reimbursement provision of the compensation statutes compensating survivor-claimants of the collapse did not retroactively revive causes of action against Jacobs that had been previously extinguished by a prior version of the statute of repose. The district court denied the motion, and the court of appeals affirmed. The Supreme Court affirmed, holding (1) the provision retroactively revived the State's action for statutory reimbursement against Jacobs; (2) the provision did not violate Jacob's constitutional right to due process; and (3) revival of the action for statutory reimbursement did not unconstitutionally impair Jacobs' contractual obligations.

This case arose out of the 2007 collapse of the Interstate 35W Bridge. Individual plaintiffs commenced lawsuits against a contractor that performed work on the bridge pursuant to a contract entered into with the State. The contractor brought a third-party complaint against Jacobs Engineering Group for indemnity and contribution on the basis that Jacobs' predecessor negligently designed the bridge. Jacobs moved to dismiss the lawsuits as time-barred and argued that the 2007 amendments to Minn. Stat. 541.051 did not revive actions for contribution or indemnity that had previously been extinguished by a prior version of the statute of repose. The district court denied the motion to dismiss, but the court of appeals reversed. The Supreme Court affirmed the court of appeals, holding that the 2007 amendments to section 541.051 did not retroactively revive the contractor's action for contribution against Jacobs.

Gregory Latterell, on behalf of his stepson Jared Boom's estate, sued Progressive Northern Insurance and AIG Insurance to recover underinsured motorist (UIM) benefits following Boom's death from a motor vehicle accident. Progressive, the insurer of Boom's vehicle, denied Latterell's claim for UIM benefits because of a business-use exclusion in Boom's insurance policy. AIG, Lattrell's insurer, also denied Latterell's claim. Latterell sued, and the district court granted summary judgment to Progressive and AIG. The court of appeals affirmed, holding (1) the business-use exclusion in the Progressive policy was enforceable under the Minnesota No-Fault Automobile Insurance Act and unambiguously excluded UIM coverage under the specific circumstances of this case, and (2) Latterell could not recover UIM benefits under the AIG policy. The Supreme Court reversed the denial of Latterell's summary judgment as to Progressive, holding that Progressive's business-use exclusion was unenforceable under the No-Fault Act. Remanded with instructions to enter judgment in favor of Latterell against Progressive.

David Miller purchased a home owned by respondents Linda Lankow and Jim Betz. The home had previously been extensively remediated because of moisture intrusion damage. Respondents Donnelly Brothers and Total Service Company and defendant Diversified Contractors, Inc. did the remediation work. After discovering and notifying respondents and defendants of additional moisture intrusion damage, buyer began to repair the home. Buyer then commenced an action against respondents and defendant to recover damages. The district court excluded buyer's expert witness evidence as a sanction for the spoliation of evidence that resulted from buyer starting to make repairs to his home. The court then granted respondents' summary judgment motion on the basis that buyer could not make a prima facie case without the expert evidence. The court of appeals affirmed. The Supreme Court reversed, holding that the duty of a custodial party to preserve evidence may be discharged when the custodial party has a legitimate need to destroy the evidence and gives the noncustodial party notice sufficient to enable the noncustodial party to protect itself against the loss of the evidence.