Justia Contracts Opinion Summaries

The Supreme Court affirmed the decision of the court of appeals affirming the order of the circuit court failing to rule on Plaintiffs' contract claim, holding that the court of appeals correctly found that Plaintiffs waived their breach of contract claim.Plaintiffs, who leased property owned by Defendants, brought this action alleging wrongful eviction, breach of contract, and defamation. The trial court granted summary judgment to Defendants on the wrongful eviction claim and then dismissed Plaintiffs' defamation claims. The court of appeals affirmed and ruled that Plaintiffs waived their breach of contract claim. The Supreme Court affirmed, holding that the court of appeals correctly held that Plaintiffs waived their contract claim. View "Wieland v. Freeman" on Justia Law

Louis DeGidio, the father of Plaintiffs, began purchasing, distributing, and servicing Industrial Combustion, LLC’s (“IC”) burners for institutional boiler systems in a sales area including most of Minnesota. IC’s non-exclusive distributors are responsible for installing and servicing the IC burners they sell. In 1996, the family incorporated Louis DeGidio, Inc. (“LDI”) and Louis DeGidio Services, Inc. (“LDSI”). LDI continued purchasing burners from IC. LDSI installed and serviced the burners LDI sold, purchasing replacement parts from IC. The two corporations shared the same location, officers, and shareholders. Plaintiffs were joint 50% shareholders and key officers of both. Whatever written agreement was then in effect is not in the record, but it is undisputed that LDI was the distributor. At issue is whether a manufacturer collects an indirect “franchise fee” within the meaning of the Minnesota Franchise Act if it charges the distributor a price based on the retail price the manufacturer paid a third-party vendor for the parts.   The Eighth Circuit affirmed and agreed with the district court the answer is clearly no, and therefore, the distributorship agreement here at issue was not a franchise. The court further agreed that the manufacturer did not breach an oral implied-in-fact contract and was not barred by promissory estoppel when it terminated the DeGidio sales representative without cause. Applying Minnesota law and reviewing de novo, the court affirmed the grant of summary judgment in favor of IC and its parent company, Cleaver-Brooks, Inc. View "Louis DeGidio, Inc. v. Industrial Combustion, LLC" on Justia Law

Appellants Robert and Kelly Franks sought automobile insurance from Appellee, State Farm Mutual Automobile Insurance Company in 2013 for their two vehicles. Appellants included underinsured motorist coverage (“UIM”) in their policy but completed a form rejecting stacked UIM coverage in compliance with Section 1738(d)(2) of the Motor Vehicle Financial Responsibility Law (“MVFRL”). Absent such waiver, stacked coverage would be the default. Appellants removed one of the original vehicles and added a third vehicle to the policy effective 2014, and again rejected stacked UIM coverage. They made another change to the policy in 2015, removing the other of the original insured vehicles with a different car. No additional form rejecting stacked UIM coverage was offered or sought to be completed on the occasion of the removal of the last vehicle, and the ongoing premiums paid by Appellants reflected the lower rate for non-stacked UIM overage on two vehicles. Robert was injured in an accident caused by the negligence of a third party. That party had insufficient liability coverage to cover Robert's injuries. Appellants initiated a claim for UIM benefits under their policy with State Farm, but the parties disagreed on the limit to their benefits. Appellants contended with the last change to the policy, there was no valid waiver of stacked UIM coverage, resulting in a default stacked coverage mandated by statute. The issue presented for the Pennsylvania Supreme Court's review in this matter was whether the Superior Court erred as a matter of law by holding that removal of a vehicle from a multiple motor vehicle insurance policy, in which stacked coverage had previously been waived, did not require a renewed express waiver of stacked coverage pursuant to Section 1738(c). The Supreme Court concluded the Superior Court did not err and affirmed its judgment. View "Franks, et al. v. State Farm Mutual" on Justia Law

Law firm Halscott Megaro, P.A. (“Halscott Megaro” or “the firm”) sued former clients and their guardians (collectively “former clients”), seeking to recover unpaid legal fees and expenses. A district court dismissed the action under Federal Rule of Civil Procedure 12(b)(6). The district court took judicial notice of a North Carolina State Bar Disciplinary Hearing Commission (“Commission”) decision that found the firm’s lead partner misled the former clients and engaged in other unethical conduct. The court then held the firm was precluded from relitigating issues decided by the Commission. It held that Halscott Megaro failed to plausibly plead claims for which relief could be granted. Halscott Megaro appealed, arguing the district court improperly considered matters outside the pleadings and failed to accept its allegations and all reasonable inferences from them as true in concluding that the Commission’s decision as to its lead partner bound the law firm.   The Fourth Circuit affirmed and held that the district court committed no reversible error in granting the former clients’ motion to dismiss or in denying the law firm’s motion for recusal. The court wrote that it agreed with the district court’s conclusion that the Commission was acting in a judicial capacity when it entered its discipline order against Megaro. The court also agreed that Megaro received a full and fair opportunity to litigate the issues and due process protections. Further, the court held that the firm’s allegations of impartiality were not related to any particular facts, sources or statements. A presiding judge is not required to recuse himself simply because of unsupported or highly tenuous speculation. View "Halscott Megaro, P.A. v. Henry McCollum" on Justia Law

The Supreme Court affirmed the decision of the district court granting summary judgment to Defendants as to some of Plaintiff's claims and the judgment entered on the defense verdicts on Plaintiff's remaining defamation claims, holding that Plaintiff had not shown grounds for reversal.Plaintiff, the former principal at St. Joseph's Catholic School, brought this action against Father Josephs Pins, St. Joseph's Church, and the Diocese of Des Moines after her employment was terminated, alleging fraud and defamation by all defendants and breach of contract against Father Pins. The district court granted summary judgment in favor of Defendants as to Plaintiff's fraud, breach of contract, and defamation claims, and then a jury returned defense verdicts on the remaining defamation claims. The Supreme Court affirmed, holding that Plaintiff was not entitled to reversal on his allegations of error. View "Konchar v. Pins" on Justia Law

Plaintiff Union Mutual Fire Insurance Company (“Union Mutual”) appealed from a district court judgment. On March 4, 2017, a fire started at Liberty Avenue in Queens, New York, spreading to and damaging four neighboring buildings insured by Union Mutual. After an investigation, the fire marshals concluded, but could not determine with certainty, that the fire originated in the extension cords used by Ace Caribbean Market. Union Mutual paid proceeds to the damaged neighboring buildings and subrogated into their owners’ tort claims. Union Mutual then sued Ace Caribbean Market and others (collectively, “Defendants”), alleging that their negligent use of the extension cords caused the fire. The district court granted summary judgment for Defendants. At issue on appeal is whether evidence that a fire may have originated in the extension cords is sufficient to show that (a) the owners and proprietors were negligent in their use of the extension cords and (b) if they were negligent, that negligence was the cause of the fire.   The Second Circuit affirmed, holding that such evidence is not sufficient. The court held that, at most, Union Mutual produced weak circumstantial evidence that something wrong with the extension cords caused the fire. But, even assuming a reasonable jury could so conclude, Union Mutual showed no evidence of negligence whatsoever on Defendants’ part, and evidence of causation by itself is not evidence of negligence. The court concluded that there may have been negligence and that negligence may have been the cause of the fire. But no inference that it was Defendants’ negligence is permissible on the facts. View "Union Mut. Fire Ins. Co. v. Ace Caribbean Mkt." on Justia Law

Plaintiffs filed claims against the Ford Motor Company (FMC) for alleged defects in vehicles the company manufactured. FMC filed a motion to compel arbitration of plaintiffs’ claims based on the arbitration provision in the sale contracts. Plaintiffs opposed FMC’s motion, including on the grounds that FMC had waived its right to compel arbitration through its litigation conduct. The trial court denied FMC’s motion on its merits.   The Second Appellate District affirmed. The court explained that it agreed with the trial court that FMC could not compel arbitration based on Plaintiffs’ agreements with the dealers that sold them the vehicles. Equitable estoppel does not apply because, contrary to FMC’s arguments, Plaintiffs’ claims against it in no way rely on the agreements. FMC was not a third-party beneficiary of those agreements, as there is no basis to conclude Plaintiffs and their dealers entered into them with the intention of benefitting FMC. And FMC is not entitled to enforce the agreements as an undisclosed principal because there is no nexus between Plaintiffs’ claims, any alleged agency between FMC and the dealers, and the agreements. View "Ford Motor Warranty Cases" on Justia Law

Defendant and his spouse maintained a car insurance policy (the “Policy”) with State Farm Mutual Automobile Insurance Company. While the Policy was in force, Defendant’s wife was involved in an accident in which she was struck and injured by an uninsured driver of an electric motorized scooter. Defendants made a claim for her injuries under the Policy’s Uninsured Motor Vehicle (“UM”) coverage. State Farm denied the claim on the ground that under the Policy, the scooter was neither a “motor vehicle” nor an “uninsured motor vehicle,” which the Policy defined as a “land motor vehicle.” State Farm sued Defendants, seeking a declaratory judgment that the Policy provided no coverage. Both parties moved for summary judgment. The district court denied Defendant’s motion, granting summary judgment in part to State Farm.   Defendants argued that because the Policy defines “uninsured motor vehicle” as a “land motor vehicle,” the plain and ordinary meaning of the term “land motor vehicle” dictates the scope of the Policy, and under the plain and ordinary meaning of the term, the scooter is a covered uninsured motor vehicle. The Eleventh Circuit reversed the district court’s grant of summary judgment to State Farm. The court concluded that the Policy defines “uninsured motor vehicle” more broadly than Florida insurance law requires. Because an insurer can provide more UM coverage than the law requires, we decline to disregard the Policy’s broader definition of uninsured motor vehicle in favor of a more limited statutory definition of motor vehicle. View "State Farm Mutual Automobile Insurance Company v. Anna Bevilacqua Spangler, et al." on Justia Law

The federal district court for the District of South Carolina certified a question of law to the South Carolina Supreme Court. In 2019, USAA issued a personal automobile policy to Megan Jenkins. The policy defined "your covered auto" as any vehicle shown on the policy's declaration, any newly acquired vehicle, and any trailer owned by the insured. While riding her bicycle, Jenkins was struck and killed by an underinsured motorist. Defendant Vincent Rafferty—Jenkins' personal representative—made a claim under Jenkins' policy for UIM property damage arising from damage to the bicycle. USAA Casualty Insurance Company (USAA) denied the claim and commenced this action in federal court, asserting Jenkins' bicycle did not fall within the definition of "your covered auto." Whether USAA prevailed depended upon whether automobile insurers were required to offer UIM property damage coverage at all. If insurers were not required to offer UIM property damage coverage, they were free to restrict such coverage to an insured's "covered auto." The federal court asked the Supreme Court whether, under South Carolina Law, an auto insurer could validly limit underinsured motorist property damage coverage to property damage to vehicles defined in the policy as a “covered auto.” In their briefs and during oral argument, the parties did not directly address the question as framed by the district court. Instead, the parties briefed and argued the broader question of whether an automobile insurer's offer of underinsured motorist (UIM) coverage had to include property damage coverage. Because the answer to the broader question yielded the answer to the certified question, the Supreme Court addressed the parties’ question. USAA rightly conceded that if the Supreme Court held an insurer was required to offer UIM property damage coverage, the Court had to answer the certified question "no." The Court indeed held insurers were required to offer UIM property damage coverage, and therefore answered the certified question "no." View "USAA Casualty v. Rafferty" on Justia Law

Plaintiff filed suit against Homolka, Homolka P.A., Watts Guerra, and Watts, alleging he is owed (1) $10,000 per month as leasing payments from October 2015, the first month he stopped receiving payments, until the September 2017 settlement; (2) a promised $50,000 truck reimbursement; and (3) a $3.4 million bonus. The jury returned a unanimous verdict for Plaintiff, finding that Homolka breached the oral contract, acting as an agent of Homolka P.A. and Watts Guerra. The jury awarded $175,000 in compensatory damages with no prejudgment interest. The district court denied Watts Guerra’s renewed motion for judgment as a matter of law and Plaintiff’s motion for a new trial. Watts Guerra and Plaintiff cross-appealed these rulings.   The Eighth Circuit affirmed. The court held that it agreed with the district court that the jury reasonably found Watts Guerra liable on an ostensible agency theory for Homolka’s breaches of the contract underlying the jury’s award of $175,000 in compensatory damages. The court reasoned that in considering these issues, “we start with the assumption jurors fulfilled their obligation to decide the case correctly,” and “we defer second to the trial court, which has a far better sense of what the jury likely was thinking and also whether there is any injustice in allowing the verdict to stand.” Applying these deferential standards, the court wrote that it has no difficulty concluding the district court did not abuse its discretion in denying Plaintiff’s motion for a new trial. The jury verdict awarding $175,000 compensatory damages was neither inadequate nor the product of an inappropriate compromise. View "Lowell Lundstrom, Jr. v. Watts Guerra LLP" on Justia Law