Justia Contracts Opinion Summaries

Articles Posted in Real Estate & Property Law
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The issue this appeal presented stemmed from a circuit court's grant of summary judgment to First American Title Company (First American) and its grant of a declaratory udgment to Pinehaven Group, LLC (Pinehaven), against Singing River Health System Ambulatory Services (AS). Singing River Health System (SRHS) informed AS that its real estate purchase from Pinehaven ten years before was void for lack of ratification by the Jackson County Board of Supervisors (the board). AS sought to void the purchase and to recover from Pinehaven and First American. The circuit court held that AS’s purchase from Pinehaven was valid and enforceable. Finding that no factual dispute that the contract was valid and enforceable existed, the Mississippi Supreme Court declined to address the other issues presented on appeal that were based on the alleged ratification requirement. "AS properly considered, approved, and executed the contract for its purchase of the Pinehaven property. As such, we affirm the circuit court’s decision that lack of ratification did not render the Pinehaven purchase void." View "SRHS Ambulatory Services, Inc. v. Pinehaven Group, LLC, et al." on Justia Law

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Plaintiff Crystal Point Condominium Association, Inc. obtained default judgments against two entities for construction defect claims. Kinsale Insurance Company was alleged to have insured those entities, under the Direct Action Statute, N.J.S.A. 17:28-2. The relevant policies both contained an arbitration agreement providing in part that “[a]ll disputes over coverage or any rights afforded under this Policy . . . shall be submitted to binding Arbitration.” Crystal Point filed a declaratory judgment action against Kinsale, alleging that it was entitled to recover the amounts owed by the entities under the insurance policies issued by Kinsale. Kinsale asserted that Crystal Point’s claims were subject to binding arbitration in accordance with the insurance policies. Kinsale argued that the Direct Action Statute did not apply because Crystal Point had not demonstrated that neither entity was insolvent or bankrupt. In the alternative, Kinsale contended that even if the statute were to apply, it would not preclude enforcement of the arbitration provisions in the policies. The trial court granted Kinsale’s motion to compel arbitration, viewing the Direct Action Statute to be inapplicable because there was no evidence in the record that either insured was insolvent or bankrupt. An appellate court reversed the trial court’s judgment, finding the evidence that the writs of execution were unsatisfied met the Direct Action Statute’s requirement that the claimant present proof of the insured’s insolvency or bankruptcy and determining that the Direct Action Statute authorized Crystal Point’s claims against Kinsale. The appellate court concluded the arbitration clause in Kinsale’s insurance policies did not warrant the arbitration of Crystal Point’s claims, so it reinstated the complaint and remanded for further proceedings. The New Jersey Supreme Court determined Crystal Point could assert direct claims against Kinsale pursuant to the Direct Action Statute in the setting of this case. Based on the plain language of N.J.S.A. 17:28-2, however, Crystal Point’s claims against Kinsale were derivative claims, and were thus subject to the terms of the insurance policies at issue, including the provision in each policy mandating binding arbitration of disputes between Kinsale and its insureds. Crystal Point’s claims against Kinsale were therefore subject to arbitration. View "Crystal Point Condominium Association, Inc. v. Kinsale Insurance Company " on Justia Law

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This was the second time plaintiff-appellant Petrolink, Inc. returned to the Court of Appeal in its suit against Lantel Enterprises. Petrolink filed an action against defendant Lantel Enterprises (Lantel), seeking specific performance of a lease agreement that gave Petrolink the option to purchase a commercial property owned by Lantel at fair market value; Lantel cross-complained against Petrolink, contending that Petrolink was refusing to purchase the property for its fair market value. The parties disagreed as to the valuation of the property and were effectively seeking a judicial determination as to the fair market value of the property so that they could complete the transaction. After years of litigation in the trial court, an appeal, a partial reversal of the judgment, remand, and further litigation, the trial court ultimately concluded that the fair market value of the property was $889,854. The court then calculated a net purchase price of $948,404 by subtracting from the fair market value a credit to Petrolink for the rents that it had paid from the date the purchase should have been completed, and adding a credit to Lantel for the loss of use of the sale proceeds. In its amended judgment, the court ordered the parties to complete the transaction; Petrolink was to deposit $948,404 in escrow and Lantel was to deliver title to the property “by grant deed free and clear of all encumbrances.” Petrolink appealed the amended judgment, arguing that it was entitled to certain additional financial reductions and offsets to the purchase price. The Court of Appeal rejected Petrolink’s contentions and affirmed the amended judgment in Petrolink II. Eleven days after Petrolink II was issued, and four days after Petrolink deposited the purchase funds in escrow, the State of California Department of Transportation (Caltrans) filed an eminent domain action pertaining to the property. The filing of the Caltrans action prevented Lantel from being able to convey unencumbered title, as required by the amended judgment. Petrolink then refused to close escrow. Lantel moved to compel performance under the trial court's order, despite the encumbrance on title resulting from the Caltrans eminent domain action. The Court of Appeal concluded the trial court did not abuse its discretion in ordering Petrolink to accept title encumbered by the Caltrans eminent domain action. "[T]he trial court weighed the equities and concluded that it would be more equitable for Petrolink to bear any burden of the encumbrance created by the filing of the Caltrans action." View "Petrolink, Inc. v. Lantel Enterprises" on Justia Law

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The Supreme Court affirmed the judgment of the district court dismissing this lawsuit after its prior decision that a 2006 agreement between the cities of Spring Hill and Olathe was unenforceable as a governmental action that could not bind subsequent city councils, holding that Olathe was not entitled to relief on any of its claims of error.The agreement at issue restricted the cities' future growth by establishing boundaries for annexing land lying adjacent to the two cities. The agreement had no fixed expiration term and stated that termination could occur only upon mutual consent of the parties. In 2021, Olathe filed a petition seeking preliminary and injunctive relief to restrain Spring Hill from annexing certain disputed property. The district court denied the request for injunctive relief and then dismissed the suit. The Supreme Court affirmed, holding that the agreement was an unenforceable attempt to bind future city councils to a governmental policy decision. View "City of Olathe v. City of Spring Hill" on Justia Law

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Fountain of praise, a church, leased space to Central Care Integrated Health Services. Shortly after the execution of the lease, the relationship soured when the parties disagreed on the frequency and amount of rent payments. Eventually, Fountain of Praise terminated the lease and successfully evicted Central Care from the premises.Subsequently, Central Care filed for Chapter 11 reorganization. Central Care then sued Fountain of Praise in state court, claiming breach of contract and unjust enrichment. Fountain of Praise then removed the case to bankruptcy court as an adversary proceeding. The bankruptcy court entered judgment in favor of Fountain of Praise, finding that any breach was excusable due to Central Care's failure to make timely rent payments and that Central Care lacked the requisite interest in the property for an unjust enrichment claim.Central Care appealed, and the district court judge assigned to the case reassigned the case to a magistrate judge who affirmed the bankruptcy court's judgment.On appeal, the Fifth Circuit vacated the magistrate judge's order, finding that the district court improperly authorized referral of the appeal from a bankruptcy court decision to a magistrate judge. Under 28 U.S.C. Section 158, appeals from a bankruptcy court must be heard either by the district court or a panel of bankruptcy court judges. View "South Central v. Oak Baptist" on Justia Law

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The Supreme Court reversed the order of the district court granting summary judgment in favor of the cities of Pella and Oskaloosa regarding the validity of an agreement between the cities and Mahaska County to establish a regional airport authority, holding that Landowners had standing to challenge the agreement.Landowners brought this action seeking a judgment that the agreement at issue was illegal and an injunction to prevent the transaction. The district court held that Landowners lacked standing to bring the suit and granted summary judgment in favor of the Cities. The Supreme Court reversed, holding (1) by entering into the agreement, the County's Board of Supervisors bound future board to a particular course of legislative action, in violation of the Iowa Constitution; (2) the agreement violated precedent regarding delegation of a municipality's legislative power; and (3) therefore, the district court erred in declaring the agreement to be valid and ordering specific performance by the County of its obligations under the agreement. View "Site A Landowners v. South Central Regional Airport Agency" on Justia Law

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The Supreme Court affirmed the order of the district court granting a motion to approve a settlement agreement reached in mediation involving siblings Lily Smith and Sam, Dan, and Vernon Lindemulder, holding that Petitioners were not entitled to relief on their claims of error.The agreement at issue resolved claims involving the Alice M. Lindemulder Trust, established by the parties' mother, which held more than 2,000 acres of land in Stillwater County. Sam appealed the district court's decision to approve the settlement agreement, arguing that the agreement was unenforceable because he lacked the capacity to enter it and had been subjected to undue influence. The Supreme Court affirmed, holding that the district court (1) did not err in concluding that Sam validly consented to the agreement; and (2) did not err in holding that the agreement was valid and enforceable. View "Smith v. Lindemulder" on Justia Law

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The First Circuit affirmed the judgment of the district court entering summary judgment in favor of Defendant Thomas Wakefield and dismissing Plaintiff Pleasantdale Condominiums LLC's claims alleging nondisclosure of material information under a Maine statute, holding that Defendant was entitled to summary judgment as a matter of law.After it purchased an apartment complex Plaintiff sued Defendant, the seller, alleging claims for fraud and negligent misrepresentation. Both counts were based on the alleged violation of Me. Rev. Stat. Ann. tit. 33, 173(5). The district court concluded that Defendant was entitled to summary judgment on both counts. The First Circuit affirmed, holding that Defendant was entitled to summary judgment as a matter of law on Plaintiff's claim for fraud in the nature of active concealment. View "Pleasantdale Condominiums, LLC v. Wakefield" on Justia Law

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The Supreme Court affirmed the decision of the court of appeals affirming the order of the district court concluding that Plaintiff was entitled to "reasonable attorney's fees" on appeal from a decision of the magistrate in Plaintiff's favor, holding that there was no error.The trial court awarded the attorney's fees at issue in this action seeking the recovery of money Defendant owed Plaintiff under a contract to purchase real estate that obligated Defendant, the buyer, to pay Plaintiff, the seller, a due diligence fee and an earnest money deposit. The court of appeals affirmed the attorney's fee award. The Supreme Court affirmed, holding that Defendant's allegations of error were unavailing. View "Reynolds-Douglass v. Terhark" on Justia Law

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The Supreme Court affirmed the decision of the court of appeals affirming the determination of the circuit court that the security agreement between Harvey Haynes, the debtor, covered future advances made by Farmers Tobacco Warehouse (Farmers) so as to have priority over the security interest claimed by Versailles Farm Home and Garden, LLC (Versailles) in Haynes' 2013 tobacco crop, holding that there was no error.In 2014, Versailles brought this action against Haynes to collect on the balance due under the agreement. Versailles joined Farmers as a party to assert its claim against Farmers for conversion to the extent Farmers retained any proceeds in excess of the amount Haynes owed. Farmers admitted selling a portion of Haynes' 2013 tobacco crop and retaining the proceeds but denied doing so in violation of Versailles' security interest. The trial court granted Versailles' motion for summary judgment against Haynes and then granted Farmers' motion for summary judgment as to its cross-claim against Haynes asserting a first and superior lien in Haynes' 2013 tobacco crop. The Supreme Court affirmed, holding that the trial court did not err. View "Versailles Farm Home & Garden, LLC v. Haynes" on Justia Law