Justia Contracts Opinion Summaries

Appellant was involved in a car accident with Kent Blough. Appellant's insurer, USAA Casualty Insurance Company, concluded that Appellant was the majority at fault for the accident and refused to honor Appellant's $300,000 UM/UIM coverage. Appellant filed suit against Blough, and in an apparent attempt to prevent Appellant from prevailing, USAA unsuccessfully tried to intervene in the lawsuit. Blough's insurer paid Appellant the limit of Blough's insurance policy. USAA's expert eventually determined that Blough, whom USAA had already paid under Appellant's policy, had been the majority at fault. USAA then tendered to Appellant its $300,000 UM/UIM policy limit. Appellant filed a complaint against USAA for, among other claims, violations of the Montana Unfair Trade Practices Act and emotional distress as a result of the mishandling of her claim. The district court entered summary judgment for USAA. The Supreme Court reversed, holding that the district court (1) erred in determining that Appellant may not pursue a claim based upon USAA's alleged failure to reasonably investigate her claim as required under Mont. Code Ann. 33-13-201(4); and (2) erred when it granted summary judgment in favor of USAA regarding Appellant's claim for damages arising from emotional distress. View " McVey v. USAA Cas. Ins. Co." on Justia Law

Burcalow Family, LLC purchased property that sat adjacent to The Corral Bar, Inc. property. Burcalow and The Corral signed a license agreement whereby The Corral agreed to pay Burcalow for the use of Burcalow's property for its drain field and well. After the license agreement expired, Burcalow filed suit against The Corral, alleging claims for trespass and a declaratory judgment. The Corral counterclaimed for, inter alia, prescriptive easement, detrimental reliance, and mistake. The district court (1) determined that The Corral possessed a prescriptive easement over and across Burcalow's property, and (2) rescinded the license agreement, ordering Burcalow to refund the fees The Corral had paid under the license agreement. The Supreme Court reversed, holding (1) The Corral failed to demonstrate the elements required to establish a prescriptive easement; and (2) Burcalow's counsel did not make fraudulent representations entitling The Corral to rescind the parties' license agreement, and therefore, Burcalow did not have to return The Corral's payments made pursuant to the agreement. Remanded. View "Burcalow Family, LLC v. The Corral Bar, Inc." on Justia Law

Thomas Warner filed a complaint against Robert and Rebecca Hanke for conversion and negligence after Robert Hanke asserted ownership over some personal property Warner was storing on the Hanke's property. At the time the action was filed, Robert and Rebecca Hankes maintained home insurance coverage from a subsidiary of Horace Mann Insurance Company. The Hankes filed a claim with Horace Mann to request a defense against Warner's suit. Horace Mann filed a declaratory judgment action requesting a determination whether the insurance policy required Horace Mann to defend the Hankes. The district court concluded that Horace Mann did not owe coverage to the Hankes for the Warner dispute. The Supreme Court affirmed in part, reversed in part, and remanded, holding that the district court (1) properly determined that the Hankes' insurance policy failed to cover the Warner dispute; (2) correctly determined that Horace Mann's decisions to provide a defense and to pay the settlement of Warner's claims nevertheless allowed Horace Mann to pursue reimbursement for the Hankes' share of the settlement; and (3) abused its discretion in awarding attorney's fees to Horace Mann. View "Horace Mann Ins. Co. v. Hanke" on Justia Law

Defendants, an attorney and a law firm, structured a tax-deferred exchange for Plaintiffs, a husband and wife and the cattle ranch they owned. It was later determined that the exchange did not qualify for deferred tax treatment under 26 U.S.C. 1031, resulting in significant tax liability for Plaintiffs. Defendants filed an action against Defendants for professional negligence, breach of fiduciary duty, breach of contract, breach of the implied covenant of good faith and fair dealing, and misrepresentation. The district court granted summary judgment to Defendants on all claims on grounds that Plaintiffs' claims were time barred. The Supreme Court reversed, holding (1) Plaintiffs' tort claims were timely filed, and the issue of whether Plaintiffs' timely filed their misrepresentation claim was a question of material fact to be resolved by a jury; (2) Plaintiffs properly stated a claim for breach of contract and the claim was not time barred; and (3) the district court erred in granting Defendants a protection order to prevent discovery of alleged work product and attorney-client communications, as further analysis and fact finding were necessary to determine which documents were discoverable and which qualified for work product or attorney-client protection. Remanded. View "Draggin' Y Cattle Co., Inc. v. Addink" on Justia Law

C.R. Weaver formed Mikart Transport, LLC in January 2011. At that time, the articles of organization named Weaver and Michael Smith as members or managers. In March 2011, Smith submitted a credit application with Tri-County Implement, Inc. After Smith failed to pay Tri-County for work it performed on two vehicles, including a Volvo semi-truck titled in Weaver's name, Tri-County refused to release the Volvo from its possession pursuant to its asserted agisters' lien on the vehicle. Weaver subsequently filed a complaint against Tri-County. In response, Tri-County filed a counterclaim against Weaver and a third-party complaint against Mikart. The district court entered judgment against Mikart, ordering it to pay for the work it performed, and awarded Tri-County attorney fees and costs. The court also held Mikart, Smith, and Weaver jointly and severally liable for these amounts. The Supreme Court reversed the portion of the district court's imposition of personal liability on Weaver for the work performed on the two vehicles, as there was no basis to hold Weaver individually liable for the obligations of Mikart to Tri-County. Remanded. View "Tri-County Implement, Inc. v. Weaver" on Justia Law

Bank and Lumber Company had business and financial relationships with Sawmill. A few years into its operation, Sawmill began experiencing serious financial difficulties. Sawmill defaulted on approximately $1.4 million in loan obligations to Bank and owed Lumber Company approximately $900,000. Proceedings were initiated in bankruptcy court and district court. While the cases were pending, Sawmill was destroyed by fire. Bank recovered approximately $980,000 from Sawmill's insurance proceeds. In a subsequent case between Bank and Lumber Company, the jury determined that neither Bank nor Lumber Company was entitled to recover damages from the other. The Supreme Court affirmed, holding that the district court did not abuse its discretion in refusing to admit into evidence a particular letter written by the Bank president. View "H.E. Simpson Lumber Co. v. Three Rivers Bank of Mont." on Justia Law

Heath and Vail Freyer, the parents of Alicia Freyer, were all riding in their vehicle, which was insured by State Farm, when the vehicle rolled over, causing Health's death. In Freyer I, the Court held that the subject policy provided coverage for Alicia's claim for derivative damages stemming from Health's death. After remand, State Farm paid the disputed coverage amounts. The Freyers then brought claims against State Farm for the wrongful denial of coverage for Alicia's derivative claims. The district court granted summary judgment to State Farm. The Supreme Court reversed in part and affirmed in part, holding that the district court (1) erred in concluding that State Farm had not breached the insurance contract when it failed to indemnify Vail for Alicia's derivative claims based on State Farm's "reasonable basis in law" defense; (2) properly granted summary judgment to State Farm on the common-law bad faith and breach of the covenant of good faith and fair dealing claims; and (3) did not err in granting summary judgment to State Farm on the Unfair Trade Practices Act claims. View "State Farm Mut. Auto. Ins. Co. v. Freyer" on Justia Law

Pam, Allan, and Charles and Mary Lou Dees (the Dees) started a business, Great Falls Portables, Inc. (GFP), with Allan acting as sole manager of the business. Pam subsequently took over management. The Dees later filed a complaint against Pam, GFP, and others. A month later, Pam and Allan, who were married but separated, entered into a settlement agreement that provided that Pam would be responsible to the Dees for any obligation owed them in connection with their interest in GFP. In litigation with the Dees, Pam filed a third-party complaint against Allan, alleging (1) the Dees' complaint arose out of Allan's fraudulent activity (Count I), (2) Allan had fraudulently induced Pam to enter the agreement assigning responsibility for the Dees' interest (Count II), and (3) Allan must indemnify her from liability to the Dees (Count III). The district court granted summary judgment to Allan on all three counts. The Supreme Court affirmed, holding that the district court correctly determined that (1) Pam failed to plead fraud with sufficient particularity; (2) Pam failed to show reliance on Allan's representations; and (3) Count III of Pam's complaint was dependent on and related back to Counts I and II. View "Fossen v. Fossen" on Justia Law

Terry Willis purchased a tract of property with funds that were apparently the proceeds from illegal drug sales. After Willis failed to make a payment, David Ferterrer contributed approximately half of the late payment. Willis was later sentenced to life imprisonment for drug-related crimes, which left him unable to pay for the property as the contract for deed contemplated. The parties agreed that Ferterrer would be responsible for completing the payments to purchase the property. Ferterrer also removed funds from Willis's checking account to prevent federal authorities from seizing those funds. Armed with a notarized agreement allegedly from Willis to sell the property to Ferterrer (the Deed), Ferterrer obtained a loan to purchase the property. Willis subsequently filed an action challenging Ferterrer's ownership of the property, also alleging that Ferterrer had converted the funds from Willis's bank account. The district court affirmed the validity of the Deed and concluded that Fertterer had not converted any funds belonging to Willis. The Supreme Court affirmed, holding (1) substantial evidence supported the district court's findings of fact; and (2) the district court properly determined that Willis failed to prove that Fertterer had converted funds from Willis's bank account. View "Willis v. Fertterer" on Justia Law

After John Irvine died, the proceeds from three of his investment accounts were paid to his estate. John's mother, Va Va, sought a declaratory judgment that she was the sole beneficiary of all three accounts. John's stepson, Michael, opposed the action. Both Va Va and Michael filed summary judgment motions. Va Va argued that John intended to benefit his estate under the laws of intestacy, not under the terms of his 1983 will, which included Michael as a beneficiary, and that John intended for her to be the contingent beneficiary for all three accounts. To support her contention, Va Va offered testimony from John's financial planner, who testified that he erroneously believed that John did not have a will when he executed beneficiary designation forms for a number of accounts. Va Va argued that the written contracts should be reformed for mutual mistake. The district court concluded that Michael was entitled to summary judgment under the contract terms and that no legal basis existed to require reformation of the contracts. The Supreme Court affirmed, holding that the district court correctly determined that (1) the contracts could not be reformed; and (2) proceeds from John's investment accounts were properly paid to his estate. View "Estate of Irvine v. Oaas" on Justia Law