Justia Contracts Opinion Summaries

In 1997, William Brokaw Price’s parents entered into a contract with Carri Scharf Trucking, Inc. (CST) for surface-level mining on their property. The contract allowed CST to extract sand, gravel, and topsoil in exchange for royalty payments. As the contract neared its end in 2010, Bill Price, Brokaw’s father, communicated with CST about future plans for the property but passed away shortly after. Years later, Brokaw discovered that the property had not been reclaimed as required by the contract, leading to a dispute over CST’s reclamation obligations and alleged trespassing.The Prices sued CST for breach of contract, and CST counterclaimed for breach based on the Prices’ trespass accusations. The first trial ended in a mistrial, and the second trial resulted in a verdict for CST. The district court denied the Prices’ motion for judgment as a matter of law and rejected CST’s request for attorney’s fees under the contract’s fee-shifting provision.The United States Court of Appeals for the Seventh Circuit reviewed the case. The court affirmed the district court’s decision, holding that the contract did not set a firm deadline for reclamation and allowed for a jury to resolve factual disputes about the instructions given by Bill Price. The jury had a sufficient basis for its verdict in favor of CST. Additionally, the court held that CST was not entitled to attorney’s fees because the contract’s fee-shifting provision only applied to parties enforcing the contract’s terms, and CST’s successful defense did not trigger that provision. The court affirmed the judgment of the district court in all respects. View "Price v Carri Scharf Trucking, Inc." on Justia Law

A contractor hired a subcontractor to work on a remote bridge construction project. The scope of the work changed, and neither party kept detailed records of the changes and associated costs. Years after the project was completed, the subcontractor sued for damages, claiming unpaid work. The superior court found that the subcontract did not govern the extra work, awarded some damages to the subcontractor, and precluded some claims due to discovery violations. The court also found the contractor to be the prevailing party and awarded attorney’s fees. Both parties appealed.The superior court denied summary judgment motions from both parties, finding factual disputes. It precluded the subcontractor from pursuing certain damages claims due to insufficient documentation but allowed evidence for contingent findings. After a bench trial, the court awarded the subcontractor $191,443.42, later reduced to $146,693.42 upon reconsideration. The court found the contractor to be the prevailing party under Rule 68 and awarded attorney’s fees.The Supreme Court of Alaska reviewed the case. It concluded that the superior court abused its discretion by precluding the subcontractor’s claims for snowmachine use and labor without considering less severe sanctions. The court affirmed the superior court’s findings on other damages but reversed the awards for Morris Johnson’s labor and boat use, remanding for recalculation. The prevailing party determination and attorney’s fee award were vacated and remanded for reconsideration. The court otherwise affirmed the superior court’s judgment. View "Johnson v. Albin Carlson & Co." on Justia Law

White Knight Development, LLC entered into a contract in 2015 to purchase land from Dick and Julie Simmons for $400,000. The contract included a "buy-back" provision allowing White Knight to require the Simmonses to repurchase the property if certain restrictions were extended. When the restrictions were extended in October 2016, White Knight invoked the buy-back provision, but the Simmonses refused to repurchase the property. White Knight sued for breach of contract and sought specific performance and damages related to the delay in performance.The trial court found that the Simmonses breached the contract and awarded White Knight specific performance, ordering the Simmonses to repurchase the property for $400,000. Additionally, the court awarded White Knight $308,136.14 in damages for various costs incurred due to the delay in performance. These costs included property taxes, loan interest, and other expenses related to the property and White Knight's business operations.The Court of Appeals for the Tenth District of Texas modified the judgment by deleting the $308,136.14 monetary award but otherwise affirmed the trial court's decision. The court acknowledged that monetary compensation could be awarded alongside specific performance in narrow circumstances but found no express statement by the trial court that the monetary award was equitable in nature.The Supreme Court of Texas held that while specific performance usually precludes a monetary award, there are narrow circumstances where both can be awarded. The court concluded that the trial court's findings supported an equitable monetary award to account for the delay in performance. The Supreme Court reversed the Court of Appeals' judgment in part and remanded the case for further review of the monetary award consistent with the principles announced. View "WHITE KNIGHT DEVELOPMENT, LLC v. SIMMONS" on Justia Law

Tom Smith Masonry (Smith Masonry) and WIPI Group USA, Inc. (WIPI) entered into a contract for Smith Masonry to construct a fence on WIPI’s property. After completing most of the work, Smith Masonry requested final payment, which WIPI withheld due to a dispute over the installation of a gate operator. Smith Masonry filed a mechanic’s lien and subsequently a lawsuit to foreclose on the lien, seeking the unpaid balance. WIPI counterclaimed for breach of contract and other issues, seeking damages for alleged faulty workmanship.The Circuit Court of the Second Judicial Circuit, Lincoln County, South Dakota, denied relief to both parties, finding that Smith Masonry’s work was defective and that WIPI’s damages were not established with exactitude. Smith Masonry appealed, and the South Dakota Supreme Court reversed and remanded, directing the lower court to enter a judgment of foreclosure in favor of Smith Masonry for the full amount of the lien and to reconsider Smith Masonry’s request for attorney fees.On remand, the circuit court entered a judgment in favor of Smith Masonry on the lien but denied the request for attorney fees. Smith Masonry appealed again. The South Dakota Supreme Court found that the circuit court violated the law of the case doctrine by revisiting issues already settled in the first appeal and by speculating on what might have occurred had the trial resumed. The Supreme Court also held that the circuit court abused its discretion by denying attorney fees based on irrelevant factors and an overly narrow interpretation of the statute governing attorney fees in mechanic’s lien cases.The South Dakota Supreme Court reversed the circuit court’s denial of attorney fees and remanded for a determination of an appropriate award of attorney fees consistent with its opinion. The court also awarded Smith Masonry $30,000 for appellate attorney fees. View "Smith Masonry v. Wipi Group Inc." on Justia Law

In this case, a construction financer, Mortgages Ltd. (ML), collapsed, leading to numerous mechanics' liens on unfinished projects. ML had loaned $165 million to Tempe Land Company (TLC) for a condominium project, securing the loan with a deed of trust and purchasing a title insurance policy from Fidelity National Title Insurance Company. Contractors began recording mechanics' liens against the property, and ML entered involuntary bankruptcy. The Loan LLCs, created to hold ML's assets, foreclosed on the property but did not extinguish the liens. Universal and VRCP provided loans to ML Manager and the Loan LLCs, securing their loans with deeds of trust and obtaining title insurance policies from Commonwealth Land Title Insurance Co.The trial court granted summary judgment to Commonwealth on CMLC's breach of contract claim, finding that the loans were fully repaid, thus precluding coverage under the policy. The case proceeded to trial on CMLC's bad faith claim, where the jury awarded $5 million in damages. Both parties appealed. The court of appeals vacated the trial court's summary judgment on the breach of contract claim, directing the trial court to enter summary judgment for CMLC, and affirmed the denial of Commonwealth's motion for judgment as a matter of law on the bad faith claim.The Supreme Court of Arizona reviewed the case and held that Commonwealth could contest coverage based on policy provisions limiting liability to the unpaid indebtedness. The court found that the loans were fully repaid, thus no covered loss occurred. The court also held that the diminution in lien value did not constitute actual pecuniary damage to support a bad faith claim. Additionally, the court ruled that the collateral source rule did not preclude evidence of loan repayments. The court vacated the court of appeals' opinion, affirmed the trial court's summary judgment for Commonwealth on the breach of contract claim, and remanded to enter summary judgment for Commonwealth on the bad faith claim. View "CENTERPOINT v COMMONWEALTH" on Justia Law

Coyote Aviation Corporation (Coyote) entered into a 20-year lease with the City of Redlands (City) on April 4, 2000, for property at the Redlands Municipal Airport. The lease included two 15-year options to extend. An amended lease was signed on September 5, 2000, with the same termination date of April 4, 2020. Coyote believed the lease should terminate on September 5, 2020, but no written amendment was made. In June 2020, Coyote attempted to exercise the extension option, but the City rejected it, stating the lease had already terminated. The City issued a 30-day notice to quit, and Coyote filed a lawsuit for breach of contract and other claims.The Superior Court of San Bernardino County sustained the City’s demurrer to Coyote’s first amended complaint (FAC) and entered judgment against Coyote. The court found that Coyote failed to provide timely written notice to exercise the extension option as required by the lease. The court also rejected Coyote’s claims of breach of the implied covenant of good faith and fair dealing, declaratory relief, and promissory estoppel, finding no clear promise by the City to amend the lease termination date.The City filed an unlawful detainer action when Coyote did not vacate the property. The trial court granted summary judgment in favor of the City, ordering Coyote to vacate. The court found no triable issues of fact regarding the timeliness of Coyote’s notice to exercise the extension option and rejected Coyote’s arguments of estoppel and waiver.The California Court of Appeal, Fourth Appellate District, Division Two, affirmed the trial court’s decisions. The court held that the lease’s terms were clear and unambiguous, requiring written notice to exercise the extension option. The court also found that City officials did not have the authority to amend the lease orally or accept late notice. The court upheld the trial court’s rulings on the demurrer and summary judgment, denying Coyote’s claims and requests for leave to amend. View "Coyote Aviation Corp. v. City of Redlands" on Justia Law

EdgeRock Development, LLC developed a planned unit development in Westfield, Indiana, comprising retail and residential projects. EdgeRock contracted with C.H. Garmong & Son, Inc. and Fox Contractors Corp. to develop the lots. When EdgeRock fell behind on payments, Garmong and Fox recorded construction liens on all five lots, including those sold to ZPS Westfield, LLC and a nonparty. The contractors sued EdgeRock for breach of contract and sought to foreclose the liens.The Hamilton Superior Court awarded the contractors most of the relief they sought, including foreclosure of the construction liens. The Indiana Court of Appeals reversed the foreclosure, concluding the liens were overstated as they were not limited to debts for improvements directly benefiting the properties to which the liens attached.The Indiana Supreme Court reviewed the case to address the validity and scope of the construction liens and the priority between the construction liens and First Bank Richmond’s mortgage lien. The court held that a construction lien secures only the debt for improvements directly benefiting the property to which the lien attaches. Therefore, the contractors can foreclose the liens on each property to recover only those amounts. The court also concluded that First Bank’s mortgage lien is senior to the construction liens for the amount loaned to satisfy Garmong’s prior construction lien but junior for the remaining amounts.The court affirmed the trial court’s judgment in part, reversed in part, and remanded for the trial court to amend the judgment consistent with its opinion. The court also noted that its holdings do not disturb the in personam judgments against EdgeRock on Garmong’s and Fox’s breach-of-contract claims. View "Edgerock Development, LLC v. C.H. Garmong & Son Inc" on Justia Law

Cashman Equipment Corporation, Inc. (Cashman) was contracted by Cardi Corporation, Inc. (Cardi) to construct marine cofferdams for the Sakonnet River Bridge project. Cashman then subcontracted Specialty Diving Services, Inc. (SDS) to perform underwater aspects of the cofferdam installation. Cardi identified deficiencies in the cofferdams and sought to hold Cashman responsible. Cashman believed it had fulfilled its contractual obligations and sued Cardi for breach of contract, unjust enrichment, and quantum meruit. Cardi counterclaimed, alleging deficiencies in Cashman's construction. Cashman later added SDS as a defendant, claiming breach of contract and seeking indemnity and contribution.The Superior Court denied SDS's motion for summary judgment, finding genuine disputes of material fact. The case proceeded to a jury-waived trial, after which SDS moved for judgment as a matter of law. The trial justice granted SDS's motion, finding Cashman failed to establish that SDS breached any obligations. SDS then moved for attorneys' fees, which the trial justice granted, finding Cashman's claims were unsupported by evidence and lacked justiciable issues of fact or law. The trial justice ordered mediation over attorneys' fees, resulting in a stipulated amount of $224,671.14, excluding prejudgment interest.The Rhode Island Supreme Court reviewed the case and affirmed the Superior Court's amended judgment. The Supreme Court held that the trial justice did not err in granting judgment as a matter of law, as Cashman failed to provide specific evidence of justiciable issues of fact. The Court also upheld the award of attorneys' fees, finding no abuse of discretion. Additionally, the Court determined that the attorneys' fees were not barred by the Bankruptcy Code, as they arose post-confirmation and were not contingent claims. View "Cashman Equipment Corporation, Inc. v. Cardi Corporation, Inc." on Justia Law

A contractor, Flintco, LLC, entered into a subcontract with Total Installation Management Specialists, Inc. (Total) for flooring work on a construction project at Oklahoma State University. Total was required to secure a performance bond from Oklahoma Surety Company (OSC). Flintco later supplemented Total's workforce due to delays and performance issues but did not notify OSC until five weeks after taking over the work.The Tulsa County District Court ruled in favor of Flintco, awarding damages against Total and OSC. OSC appealed, arguing that Flintco failed to meet the performance bond's conditions requiring a declaration of default and reasonable notice before assuming control of the work. The Court of Civil Appeals reversed the district court's judgment, finding that the notice requirement was a mandatory condition precedent, and Flintco's failure to provide timely notice relieved OSC of liability.The Supreme Court of the State of Oklahoma reviewed the case and agreed with the Court of Civil Appeals. The court held that the performance bond's notice requirement constituted a mandatory condition precedent. Flintco's failure to provide timely notice to OSC so it could exercise its performance options under the bond relieved OSC from liability. The court vacated the Court of Civil Appeals' opinion, reversed the district court's judgment, and remanded the case with instructions to enter judgment consistent with this decision. The trial court's judgments against Total were not affected by this decision. View "Flintco, LLC v Total Installation Management Specialists, Inc." on Justia Law

The case involves Billings County and its commissioners, who appealed a district court's decision to grant a preliminary injunction preventing them from entering the property of Sandra Short, David Short, Donald Short, and Sarah Sarbacker. The dispute centers on the County's attempt to use eminent domain to construct a bridge over the Little Missouri River, known as the Little Missouri River Crossing (LMRC). The Shorts had previously settled a lawsuit with the County in 2021, where the County agreed not to pursue eminent domain for the LMRC project. Despite this, a newly elected Board of Commissioners decided to proceed with the project in 2023, leading the Shorts to file a new lawsuit.The United States District Court for the District of North Dakota granted a preliminary injunction in favor of the Shorts, finding that they were likely to succeed on their breach-of-contract claim based on the Settlement Agreement. The court refrained from deciding on the validity of the Settlement Agreement, leaving that issue for the state court to address. The district court also stayed its proceedings, pending the outcome of the state court case, and denied the County's motion to dismiss without prejudice.The United States Court of Appeals for the Eighth Circuit reviewed the case and vacated the preliminary injunction. The appellate court held that the County could not lawfully contract away its power of eminent domain, as it is an essential attribute of sovereignty. The court concluded that the Settlement Agreement was contrary to law and that the Shorts were not likely to succeed on their breach-of-contract claim. The case was remanded for further proceedings consistent with this opinion. View "Short v. Billings County" on Justia Law