Justia Contracts Opinion Summaries

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

Plaintiff had a $1 million insurance policy from Defendant on an office building. On February 23, 2007, the building was severely damaged in a fire. Defendant paid Plaintiff the actual cash value of the destroyed building in the amount of $757,812 but withheld the cost of replacing the destroyed property until Plaintiff could replace the property. The replacement building was completed in October 2010. Plaintiff brought an action against Defendant seeking payment of the unpaid portion of the policy limits. The U.S. district court granted Defendant’s motion to dismiss, concluding that the policy barred any suits commenced more than two years after the date of the damage and that the two-year limitation period was reasonable. The Court of Appeals answered a question from the Second Circuit Court of Appeals and held that such a contractual limitation period, applied to this case in which the property could not reasonably be replaced in two years, was unreasonable and unenforceable. View "Executive Plaza, LLC v. Peerless Ins. Co." on Justia Law

Plaintiff sold fine art and antiques at public auctions. Plaintiff permitted absentee bidding in addition to traditional in-person bidding. In 2008, Defendant submitted a signed absentee bidder form and submitted a $400,000 bid on a certain item. Defendant successfully outbid a competing bidder, and the chief clerk recorded the winning bid on Plaintiff's clerking sheet. After Defendant failed to pay Plaintiff for the item, Plaintiff commenced this action for breach of contract, seeking damages, including the bid price and the buyer's premium. Both parties filed motions for summary judgment. At issue in this case was whether the clerking sheet and related bidding documents satisfied the Statute of Frauds. Supreme Court granted summary judgment to Plaintiff on liability. The Appellate Division reversed. The Court of Appeals reversed, holding that Plaintiff complied with the statutory requirement of a writing in support of its breach of contract claim, thus establishing an enforceable agreement. View "William J. Jenack Estate Appraisers & Auctioneers, Inc. v. Rabizadeh" on Justia Law

Plaintiffs, former employees of a school district (District), were members of a collective bargaining unit. One plaintiff retired while the 1999-2003 collective bargaining agreement (CBA) was in effect, and the other plaintiffs retired under the 2003-2007 CBA. In 2009, the District informed Plaintiffs that their co-pays would be governed under the terms of the 2007-2012 CBA, resulting in an increase from their previous co-pay charges. Plaintiffs filed this action for breach of contract, alleging that by increasing their co-pays, the District violated the terms of the CBAs in effect when Plaintiffs retired. Supreme Court granted summary judgment for Plaintiffs. The Appellate Division reversed, concluding that the contract did not specify that an equivalent level of coverage would continue during retirement. The Court of Appeals affirmed the order of the Appellate Division as modified, holding (1) the plain meaning of the contract unambiguously established that Plaintiffs had a vested right to the "same coverage" during retirement as they had when they retired; and (2) because an issue of fact remained as to whether the parties intended for the right to the "same coverage" to preclude any modifications to prescription co-pays, it was necessary to remit the case for a hearing on the issue. View "Kolbe v. Tibbetts" on Justia Law

On October 18, 2000, Tenant leased Landlord's billboard for fifteen years, commencing on December 1, 2000 and ending September 30, 2015. The lease obligated Tenant to pay the full annual basic rent for 2007 to Landlord on January 1, 2007. Tenant later terminated the lease, effective January 8, 2007, and gave Landlord a check representing rent for the period of January 1, 2007 through January 8, 2007. Landlord filed suit against Tenant seeking the balance of the basic rent for 2007. Tenant moved for summary judgment, suggesting that Landlord agreed to pro-rate rent for 2007 during an oral communication. Supreme Court granted summary judgment for Tenant. The Appellate Division reversed and granted summary judgment for Landlord. The Court of Appeals affirmed, holding that Tenant was obligated to pay the full annual basic rent for the calendar year 2007, the parties did not agree in the lease to apportion rent post-termination except in specified circumstances not relevant here, and Tenant's claim that the parties orally agreed to such apportionment was barred by the lease's "no oral modification" clause. View "Eujoy Realty Corp. v. Van Wagner Commc'ns, LLC" on Justia Law

Plaintiffs here were related entities that leased a building to The Salvation Army. The Salvation Army operated the building as a homeless shelter under an agreement with the City of New York. After the City terminated its agreement with The Salvation Army, The Salvation Army terminated the lease. Plaintiffs brought this action to collect damages from The Salvation Army, claiming that the leased premises were returned in bad condition in violation of the lease. The appellate division concluded that Plaintiffs had adequately pleaded a breach of the lease. The Court of Appeals reversed, holding that Plaintiffs' claim was barred by the plain language of the lease. View "JFK Holding Co. LLC v. City of New York" on Justia Law

Plaintiff, the owner of an apartment building, complained when Armory Plaza, the owner of the lot next to Plaintiff's building, began excavating the lot to make way for a new building. The excavation purportedly caused cracks in the walls and foundations of Plaintiff's building. After Plaintiff's insurer (Defendant) rejected Plaintiff's claims under its policy, Plaintiff brought suit. The U.S. district court granted summary judgment for Defendant, holding that the alleged conduct of Armory and its contractors was not "vandalism" within the meaning of the policy. On appeal, the Second Circuit Court of Appeals certified two questions of law to the New York Court of Appeals, which answered by holding (1) for purposes of construing a property insurance policy covering acts of vandalism, malicious damage may be found to result from an act not directed specifically at the covered property; and (2) the state of mind required to find malicious damage is a conscious and deliberate disregard of the interests of others that the conduct in question may be called willful or wanton. View "Georgitsi Realty, LLC v. Penn-Star Ins. Co." on Justia Law

Petitioner and Ajmal Khan, principal of Verus Investment Holdings, purchased securities in a company to arbitrage a merger between that company and another company (the trade). Petitioner and Khal used Verus' account at Jefferies & Co. and Winton Capital Holding to complete the purchase. After the merger, Jefferies wired to Verus the original investment and profits attributable to the Winton funds. Verus wired the investment money to Winton and the profits to Doris Lindbergh, a friend of Petitioner. Tax authorities later informed Jefferies it owed withholding tax on the trade. Pursuant to an arbitration clause in an agreement between Jefferies and Verus, Jefferies commenced an arbitration against Verus for the unpaid taxes. Verus, in turn, asserted thirty-party arbitration claims against Petitioner, Lindbergh, and others for their share of the taxes. After a hearing, Supreme Court determined that nonsignatories Petitioner and Lindbergh could not be compelled to arbitrate. The Appellate Division reversed, concluding that Petitioner should be estopped from avoiding arbitration because he knowingly exploited and received direct benefits from the agreement between Jefferies and Verus. The Court of Appeals reversed, holding that Petitioner did not receive a direct benefit from the arbitration agreement and could not be compelled to arbitrate. View "Belzberg v. Verus Invs. Holdings Inc." on Justia Law

The Attorney General (AG) sued two of the former officers of American International Group, Inc. (AIG), alleging that Defendants violated the Martin Act and committed common law fraud. Specifically, the AG claimed that Defendants helped cause AIG to enter into a sham transaction with General Reinsurance Corporation (GenRe) in which AIG purported to reinsure GenRe on certain insurance contracts. The AG withdrew his claims for damages and now sought only equitable relief. The Appellate Division denied Defendants' motion for summary judgment. The Court of Appeals affirmed, holding (1) the evidence of Defendants' knowledge of the fraudulent nature of the transaction was sufficient to raise a triable issue of fact; and (2) the AG was not barred as a matter of law from obtaining equitable relief. View "People v. Greenberg" on Justia Law