Justia Contracts Opinion Summaries

Amjad Tufail leased property to Midwest Hospitality pursuant to a lease agreement. The City Board of Zoning Appeals ultimately approved Midwest's application for a special use permit to operate a Church's Chicken fast-food restaurant with a drive-through on the property but placed conditions on the permit. Midwest subsequently notified Tufail that it was no longer responsible for lease payments because Tufail made a false representation to Midwest regarding the terms of the lease. Specifically, Midwest contended that Tufail represented that Midwest may not be prevented from using the property for certain specified purposes. Tufail brought this breach of contract action against Midwest. Midwest counterclaimed for breach of contract, deceptive advertising, and unjust enrichment. The trial court ruled in favor of Tufail. The court of appeals reversed, determining that Midwest's early termination of the lease was justified by Tufail's misrepresentation. The Supreme Court reversed, holding that Tufail's representation was not false where (1) the representation did not include any use of the property as a Church's Chicken fast-food restaurant with a drive-through; and (2) the circuit court found Midwest was not prevented from using the property for the uses specified in the lease. Remanded. View "Tufail v. Midwest Hospitality, LLC" on Justia Law

The issue on appeal before the Supreme Court in this case was a court of appeals' finding that Wachovia Bank, N.A. committed the unauthorized practice of law in closing a home equity loan in 2001. In 2001, Michael Coffey obtained a home equity line of credit from the Bank, using a Hilton Head Island home as collateral. While the mortgage documents the Bank prepared contained language that Michael owned the home, he was not on the title to the home. It belonged to his wife Ann alone. Ann did not sign the line of credit papers. The money was used to purchase a sailboat, the title of which placed in the name of A&M Partners, a company both Michael and Ann jointly owned. Michael made payments on the boat from a personal checking account. He died in 2005, and Ann continued to make payments from the same personal checking account until she decided to sell the boat through a broker. The Broker checked the status of the Bank's loan. It informed Ann that there was no lien or mortgage on the boat. Believing that the boat was then paid for, she sold the boat in 2006 and stopped making payments. Six months later, the Bank filed a foreclosure action against Michael's estate. Ann moved to dismiss, and the trial court granted her motion for summary judgment, citing the Bank's failure to perform due diligence to see that Michael did not own the property the Bank used as collateral for the loan. Finding that the Bank never held a valid mortgage, the Supreme Court affirmed the trial court's grant summary judgment. View "Wachovia Bank v. Coffey" on Justia Law

The O'Neals appealed a circuit court order that granted Bama Exterminating Company, Inc.'s motion to compel arbitration. The dispute arose shortly after the O'Neals closed on the purchase of a house. As part of the loan disclosures, Bama Exterminating prepared an inspection report that the house was termite-free. The report did disclose a prior infestation at the house's carport from several years earlier. Mr. O'Neal signed the report right below the arbitration provision. Two weeks after closing, the O'Neals discovered "bugs" in the walls. They called Bama Exterminating who confirmed that the bugs were termites. The O'Neals then sued Bama Exterminating alleging negligence, wantonness and breach of contract. Bama Exterminating answered their complaint with the affirmative defense of the arbitration clause in the inspection report. The parties moved toward trial in the circuit court. When mediation failed, Bama Exterminating moved the court to compel arbitration. The O'Neals argued that the exterminator waived its right to compel arbitration by its participation in the litigation process. The Supreme Court found the exterminator did not waive its right to compel arbitration, and therefore affirmed the circuit court's decision to grant the company's motion. View "O'Neal v. Bama Exterminating Company, Inc. " on Justia Law

This case involved a dispute between Johnny Hughes and his parents, Jack and Shirley Hughes, regarding borrowed money, the partition of jointly owned real property and accompanying water rights, and a contested pasture lease. The district court ruled in favor of Johnny on all of the issues except for the water rights. The Supreme Court affirmed in part, reversed in part, and remanded, holding (1) the jury's determination that Johnny paid interest on a promissory note executed in favor of Jack and Shirley in 1989 restarted the statute of limitations on the note, and therefore, the matter was remanded to consider the amount of principal and interest Johnny owed on the note; (2) the partition agreement between the parties dissolved whatever right Jack and Shirley may have possessed in a life estate on a house on the land Johnny received pursuant to the agreement or to insurance proceeds Johnny received after the house was destroyed by fire; (3) Jack was entitled to an easement for stock water across Johnny's property; and (4) the arbitrator who arbitrated the pasture lease did not exceed his authority or miscalculate damages. View "Hughes v. Hughes" on Justia Law

Plaintiff, a Hawaii non-profit corporation, entered into a lease agreement with Defendant, the trustee of a trust. Plaintiff subsequently began renting cabins on the property to the public. After a dispute arose between the parties regarding the terms of the lease, Plaintiff filed a complaint in the circuit court seeking a declaratory judgment that its commercial uses of the property and rental of cabins to the public was permitted under the lease, among other things. The circuit court granted summary judgment in favor of Defendant on Plaintiff's claim regarding cabin rentals but granted summary judgment in favor of Plaintiff on Defendant's counterclaims for breach of contract and unjust enrichment. The intermediate court of appeals (ICA) vacated summary judgment as to the issue of cabin rentals. The Supreme Court (1) affirmed the ICA regarding cabin rentals, holding that the portion of the lease delineating permissible uses of the property was ambiguous; and (2) reversed the ICA's judgment regarding Defendant's counterclaims for breach of contract and unjust enrichment because the issue of whether Plaintiff was prohibited by the lease from renting cabins to the general public had yet to be resolved on remand. Remanded. View "Hawaiian Ass'n of Seventh-Day Adventists v. Wong" on Justia Law

The Waikoloa Beach Villas condominium project was developed by Respondent, Sunstone Waikoloa, LLC. Petitioner, the Association of Apartment Owners of the Waikoloa Beach Villas, contacted Respondent to resolve issues resolving purported construction defects. Petitioner then filed a motion to compel mediation and arbitration. Respondent argued that it could not request arbitration because it had failed to comply with the requirements of the Declaration of Condominium Property Regime for the Villas. The Declaration imposed numerous requirements that Petitioner must meet before initiating arbitration or litigation proceedings against Respondent. The lower court granted Petitioner's motion. The intermediate court of appeals (ICA) reversed. The Supreme Court vacated in part and affirmed in part the judgment of the ICA, holding that section R.4(c) of the Declaration violated Haw. Rev. Stat. 514B-105(a) because it imposed limitations on Petitioner in arbitration or litigation more restrictive than those imposed on other persons. Remanded. View "Ass'n of Apartment Owners of Waikoloa Beach Villas v. Sunstone Waikoloa, LLC" on Justia Law

Plaintiffs owned an undivided five-sixths interest of land on which they executed an oil and gas lease to Prestige Exploration, Inc. Plaintiffs ownership interests were managed by Regions Bank who helped negotiate the terms of the lease. Prestige acquired the lease on behalf of Defendant Matador Resources Company. The issue before the Supreme Court centered on the extension of that lease. Plaintiffs sought to rescind or reform the extension agreement to make it applicable only to a portion of their property. After several preliminary partial summary judgment rulings, a jury found in favor of Defendant for the extension to cover the entirety of Plaintiffs' land interest. The appellate court affirmed in part, reversed in part, and reformed the lease to extend only to the portion of land for which Plaintiffs asked. Upon review, the Supreme Court found that Plaintiffs were precluded from rescinding the agreement on "excusable error." Further, the Court found no manifest error in the district court proceedings. The Court reversed the appellate court's judgment and reinstated the trial court's judgment in its entirety. View "Peironnet v. Matador Resources Co." on Justia Law

The Hernandezes (Hernandez) entered into a real-estate contract to buy 100 acres of land in Van Buren County from the Humphries (Humphries). The sales contract included the mineral rights to the property. However, Humphries subsequently leased the oil-and-gas rights to New Century, which assigned the rights to SEECO. Humphries then sold the oil-and-gas rights to Paraclifta and Claughton. Therafter, Hernandez entered into a contract for sale of the property to the Walls (Walls). Hernandez and Walls (Appellants) filed suit against New Century, SEECO, Paraclifta, and Claughton (Appellees), alleging that Appellees were not innocent purchasers the oil-and-gas rights and seeking cancellation of the lease issued to New Century and the assignment to SEECO, as well as the deed conveying the rights to Paraclifta and Claughton. The circuit court granted Appellees' motions for summary judgment and Appellees' requested attorney fees. The Supreme Court reversed and remanded, holding (1) a question of fact remanded as to whether Hernandez was in exclusive possession of the property, thus imputing notice of Hernandez's interest in the property; and (2) the circuit court abused its discretion in awarding attorneys' fees. View "Walls v. Humphries" on Justia Law

Plaintiff, acting as trustee for certain farm property pursuant to a deed of trust, brought this interpleader action seeking a determination of rights to the sales proceeds from an auction of the farm. The court held that the district court properly denied CNH's motion for summary judgment where CNH did not have a valid contract to purchase the farm; CNH could not set aside the sale to Gittaway Ranch; CNH failed to offer any evidence that its attorney's fees were reasonable and necessary or incidental to the protection or improvement of the farm; and the district court did not abuse its discretion in awarding sanctions against defendants. View "Garden, Jr. v. Central Nebraska Housing Corp., et al." on Justia Law

Buyers bought a home from Sellers after Sellers completed Indiana's statutory disclosure forms attesting to the home's condition. Buyers subsequently discovered costly defects in the home. Buyers sued Sellers, alleging fraudulent misrepresentation. The trial court awarded damages to Plaintiffs. At issue on appeal was whether Indiana's disclosure statutes created a claim for fraudulent misrepresentation or if the common law still applied and the principle of caveat emptor precluded recovery on the action. The Supreme Court reversed, holding (1) the legislature's adoption of the disclosure statutes abrogated the state's common law jurisprudence falling within their scope, and therefore, the disclosure statues create liability for sellers when they fail to truthfully disclose the condition of features of their property that must be disclosed to the buyer; and (2) the district court erred in finding that Sellers were liable to Buyers because the defects in the home "should have been obvious" to Sellers, as Sellers' "actual knowledge" of the defects was not established. Remanded. View "Johnson v. Wysocki" on Justia Law