Justia Contracts Opinion Summaries

James Pyne, who died during these proceedings, was the founder and sole stockholder of Remet Corporation. Pyne sold Remet’s stock and facilities, along with real property he had been leasing to Remet, to Burmah Castro Holding, Inc. The sales agreement contained an indemnification provision obligating Pyne to indemnify, defendant, and holder the buyer harmless for certain environmental losses. Remet later received a letter from the Department of Environmental Conservation (DEC) notifying Remet that it was a potentially responsible party for environmental contamination at the Erie Canal Site adjacent to Remet’s real property. Remet filed notices of claim against Pyne’s estate seeking indemnification for environmental liabilities under the sales agreement. Remet then brought this action against the Estate asserting claims for contractual and common-law indemnification. Supreme Court granted Remet summary judgment on liability. The Appellate Division reversed, concluding that DEC’s letter did not require Remet to take action. The Court of Appeals reversed, holding (1) the letter was sufficiently coercive and adversarial as to require action in connection with any environmental law pursuant to the sales agreement; and (2) Remet was entitled to contractual indemnification for past and future environmental losses arising out of DEC’s investigation and remediation of the Erie Canal Site. View "Remet Corp. v. Estate of Pyne" on Justia Law

Plaintiff sued several defendants in the Delaware Court of Chancery for alleged wrongdoing related to notes purchased by Plaintiff and issued by one of the defendants. Defendants moved to dismiss, claiming that Plaintiff’s claims were barred by a no-action clause contained in the indenture agreement governing Plaintiff’s notes. The Delaware Supreme Court remanded the case for the Court of Chancery for consideration of the issues under New York law. On remand, the Court of Chancery concluded that the majority of Plaintiff’s claims were not barred under the no-action clause and that dismissal and partial dismissal were warranted with respect to the remaining claims because only those claims arose under the indenture. In response to certified questions from the Delaware Supreme Court, the Court of Appeals concluded (1) a trust indenture’s no-action clause that specifically precludes enforcement of contractual claims arising under the indenture, but omits reference to “the Securities,” does not bar a securityholder’s independent common law or statutory claims; and (2) the Court of Chancery correctly found that the no-action clause in this case, which referred only to “this Indenture,” precluded enforcement only of contractual claims arising under the Indenture. View "Quadrant Structured Prods. Co., Ltd. v. Vertin" on Justia Law

Plaintiff entered into a financial brokerage agreement with Defendant providing that Plaintiff would serve as financial advisor and investment banker in the proposed sale of certain student loan assets owned by Defendant. After Defendant transferred certain distressed assets to a fund created by the Swiss National Bank as part of a 2008 bailout, Plaintiff demanded a commission pursuant to the agreement. Defendant refused to pay. Plaintiff subsequently commenced this action for breach of contract and breach of the covenant of good faith and fair dealing. Supreme Court granted Defendant’s motion to dismiss, concluding that the financial crises and the bailout constituted an unforeseeable event that undermined the purpose of the agreement, which was “the introduction of [Defendant] by [Plaintiff] to a third party buyer.” The Appellate Division reversed. The Court of Appeals reversed, holding that Plaintiffs’ causes of action were conclusively contradicted by the language of the parties’ contract, mandating dismissal of the complaint. View "Morpheus Capital Advisors, LLC v. UBS AG" on Justia Law

IDT Corp. and Tyco International Ltd. litigated and negotiated for fifteen years over the development and use of a telecommunications system. In 2004, IDT claimed that Tyco breached its obligation under a 2000 settlement agreement to negotiate additional agreements in good faith. The Supreme Court dismissed the complaint, concluding that IDT’s claim was unsupported by the record. After the Court’s decision, more negotiations took place. In 2010, IDT again sued Tyco for breach of contract and breach of the duty to negotiate in good faith. The Court of Appeals rejected IDT’s claim, holding that the parties’ obligation to negotiate in good faith came to an end without a breach by either party because the parties had reached a “good faith impasse.” View "IDT Corp. v Tyco Group, S.A.R.L." on Justia Law

At issue in this case was N.Y. C.P.L.R. 3101(a)(4), which allows a party to obtain discovery from a nonparty. John Kapon was the CEO of Acker, Merrall & Condit Company (AMC), a retailer and auctioneer of fine and rare wines, and the employer of Justin Christoph. In 2008, William Koch commenced an action against AMC in Supreme Court concerning alleged counterfeit wine that Rudy Kurniawan had consigned to AMC and that AMC had sold to Koch. In 2009, Koch commenced a fraud action in California against Kurniawan, alleging that Kurniawan had sold Respondent counterfeit wine through AMC’s auctions and sales. In 2012, Koch, seeking disclosure in the California action, served subpoenas on Kapon and Christoph (together, Petitioners). Petitioners filed motions to quash the subpoena, which Supreme Court denied. The Appellate Division affirmed, concluding that Petitioners failed to show that the requested deposition testimony was irrelevant to the prosecution of the California action. The Court of Appeals affirmed, holding (1) the subpoenas satisfied the notice requirement of section 3101(a)(4); and (2) in moving to quash the subpoena, Petitioners failed to meet their burden of establishing that their deposition testimonies were irrelevant to the California action. View "Kapon v. Koch" on Justia Law

Appellants retained Mary Dorman to represent them in a lawsuit. During the litigation, Dorman and Appellants entered into three separate retainer agreements pertaining to Dorman’s work on the trial, on the appeal to the Appellate Division, and on the appeal to the Court of Appeals. A jury ruled in Appellants’ favor, awarding them $986,671 in damages. Dorman was awarded $296,826 for her trial work. The verdict and trial fee awards were upheld on appeal. Dorman subsequently requested fees for her appellate work, and Supreme Court awarded Dorman $233,966. After a monetary dispute arose between Dorman and Appellants, Dorman sought a declaratory judgment to enforce the three retainer agreements. Supreme Court granted Dorman’s motion, and the Appellate Division affirmed, concluding that Dorman correctly interpreted the fee calculation. The Court of Appeals modified the Appellate Division order with regard to the trial agreement and otherwise affirmed, holding (1) the trial agreement entitled Dorman to one third of the jury award; and (2) because the trial agreement did not address the treatment of statutory counsel fees, Dorman was entitled to the more generous alternative of either one third of the jury verdict or the statutory award for her trial work. View "Albunio v. City of New York" on Justia Law

In 2004, Plaintiff, a manufacturer and distributor of medical devices, and Defendant, the developer and manufacturer of CoStar, a coronary stent, entered into an agreement designating Plaintiff as the exclusive distributor of CoStar for a worldwide market territory. In 2007, Defendant notified Plaintiff that it was recalling CoStar and removing it from the worldwide market. Plaintiff subsequently sued Defendant for breach of contract, seeking damages for lost profits related to its resale of the stents. Supreme Court granted summary judgment in favor of Defendant on the issue of damages, concluding that the lost profits sought by Plaintiff were consequential damages and subject to the agreement’s damages limitation provision. The court subsequently dismissed the complaint because, by denying Plaintiff lost profits as a remedy, the court effectively ended the lawsuit. The Appellate Division affirmed, concluding that Plaintiff’s claim was barred by the agreement’s limitation on consequential damages. The Court of Appeals reversed, holding that, under the parties’ exclusive distribution agreement, the lost profits constituted general damages, which fell outside the scope of the agreement’s limitation on recovery. View "Biotronik A.G. v. Conor Medsystems Ireland, Ltd." on Justia Law

Plaintiffs brought legal malpractice claims against Jeffrey Daniels, American Guarantee & Liability Insurance Company’s insured. American Guarantee wrongly refused to defend the claims. A default judgment was entered against Daniels, who assigned his rights against American Guarantee to Plaintiffs. Plaintiffs then brought the present action seeking to enforce American Guarantee’s duty to indemnify Daniels for the judgment. Summary judgment was awarded in favor of Plaintiffs. The Appellate Division affirmed. The Court of Appeals affirmed, concluding that American Guarantee’s breach of its duty to defend barred it from relying on policy exclusions as a defense to the present lawsuit. The Court later granted reargument, vacated its prior decision, and reversed the Appellate Division’s order, holding (1) under controlling precedent, American Guarantee was not barred from relying on policy exclusions as a defense; and (2) the applicability of the exclusions American Guarantee relied on presented an issue of fact sufficient to defeat summary judgment. View "K2 Inv. Group, LLC v. Am. Guar. & Liab. Ins. Co." on Justia Law

Filippo Gallina and his wife (Plaintiffs) commenced a personal injury action against Preferred Trucking Services Corp. Preferred Trucking was insured by County-Wide Insurance Company under a policy that required insureds to cooperate with Country-Wide in its investigation of a claim or defense against a lawsuit. The next year, Country-Wide disclaimed its obligation to defend and indemnify Preferred Trucking based upon Preferred Trucking’s refusal to cooperate in the defense. Supreme Court subsequently awarded judgment to Plaintiffs. Thereafter, Country-Wide filed this action against Preferred Trucking and Plaintiffs seeking a declaration that it was not obligated to defend and indemnify Preferred Trucking in the underlying action. Supreme Court concluded that Country-Wide was obligated to defend and indemnify Preferred Trucking. At issue on appeal was whether Country-Wide’s disclaimer was timely as a matter of law. The Appellate Court affirmed, concluding that Country-Wide’s disclaimer was untimely because it came four months after Country-Wide learned of the ground for the disclaimer. The Court of Appeals reversed, holding that Country-Wide was not obligated to defend and indemnify Preferred Trucking, as Country-Wide established as a matter of law that its delay was reasonable. View "Country-Wide Ins. Co. v. Preferred Trucking Servs. Corp. " on Justia Law

Plaintiff-hospital engaged Defendant to undertake demolition in a basement room at the hospital. Defendant hired brothers Luis and Gerardo Lema, undocumented aliens not legally employable in the United States. The Lemas were injured while performing the work and sued the hospital for violations of the state’s Labor Law. Supreme Court granted the Lemas summary judgment on liability. The hospital, meanwhile, brought this action for common-law and contractual contribution and indemnification against Defendant to recover damages incurred in the Labor Law litigation with the Lemas. Supreme Court granted Defendant’s motion to dismiss on the ground that the complaint did not state a cause of action, reasoning that N.Y. Workers’ Comp. Law 11 barred the hospital’s action. In so holding, the court determined that non-compliance with the Immigration Reform and Control Act (IRCA) did not deprive Defendant of the protection of section 11. The Appellate Division affirmed. The Court of Appeals affirmed, holding that Defendant was entitled to the safe harbor in section 11 because the Lemas did not suffer grave injuries, there was no preexisting agreement for contractual contribution or indemnification, and the hospital did not contend that IRCA preempts section 11. View "N.Y. Hosp. Med. Ctr. of Queens v Microtech Contracting Corp." on Justia Law