Justia Contracts Opinion Summaries

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.

Employee was injured while working in Minnesota for Wisconsin-based Employer. Employee applied for Wisconsin and Minnesota workers' compensation benefits. Employer's insurance company, Travelers Insurance, covered the Wisconsin benefits but denied the claim for Minnesota benefits based on an exclusion of Minnesota coverage in Employee's policy. Employee then filed a claim for Minnesota benefits with the Minnesota Department of Labor and Industry. After settling the claim, the Department pursued a petition for reimbursement it had filed against Employer. A compensation judge found that Employer was not insured for Minnesota workers' compensation liability and ordered Employer to reimburse the Department. The Workers' Compensation Court of Appeals (WCCA) reversed, concluding that Employer was entitled to coverage from Travelers under the reasonable expectations doctrine. On review, the Supreme Court reversed and remanded for reconsideration in light of a recent Court decision clarifying that the doctrine should not be used to provide coverage in contravention of unambiguous policy terms. On remand, the WCCA again reversed the compensation judge. On review, the Supreme Court reversed, holding that the WCCA had no authority to declare unambiguous language of an insurance contract to be invalid and unenforceable because the exclusion conflicted with Wisconsin statutory provisions and public policy.

While Timothy Allen worked as a sales associate for respondent Burnet Realty, he executed agreements to participate in respondent's legal administration program (LA Program). Under the LA Program contracts, Allen and respondent agreed to an allocation of expenses should a dispute arise related to Allen's work for respondent. In litigation commenced after he stopped working for respondent, Allen claimed that respondent violated Minn. Stat. 60K.47 because the LA Program contracts were insurance, and, as a result, respondent was required to be, but was not, authorized to engage in the business of insurance in Minnesota. Allen also claimed other relief on the basis that the contracts were insurance. The district court granted summary judgment in favor of respondent, concluding that the contracts were not contracts of insurance. The court of appeals affirmed. The Supreme Court affirmed the grant of summary judgment to respondent, holding that the LA Program was not "insurance" under statutory definitions on statute or case law.