Justia Contracts Opinion Summaries

Plaintiffs sued Juno under the Interstate Land Sales Full Disclosure Act (ILSFDA), 15 U.S.C. 1701, seeking rescission of their purchase agreement in a lot at Creighton Farms, claiming that Juno misrepresented its involvement with the Ritz-Carlton in regards to the Creighton Farms development. The court held, among other things, that plaintiffs established that they merit equitable rescission and that the district court properly determined that the equitable remedy was to return the property title to Juno and return the purchase price, plus interest, to plaintiffs. The court held, however, that the district court abused its discretion when it denied plaintiffs pre-judgment interest on the debt portion of their purchase funds. Therefore, the court reversed the district court and awarded plaintiffs prejudgment interest on the funds at issue at 7 percent. Accordingly, the court affirmed in part and reversed in part.

In 1999, the Baltimore City Council enacted an urban renewal plan (Plan) to renew a portion of Baltimore City. A five-block area located in the renewal area was the subject of protracted litigation between 120 West Fayette, LLLP and the Mayor and City Council of Baltimore. The current iteration of the litigation focused on a memorandum of agreement (MOA) between the City and the Maryland Historical Trust relating to the treatment of historic properties in connection with the Plan. The MOA required the City to submit redevelopment plans to the Trust for approval. After the Trust's director provided conditional approval of a fifth set of plans 120 West Fayette (Appellant) filed a complaint seeking a declaration of rights interpreting the terms of the MOA. The circuit court dismissed the complaint, finding that Appellant was neither a party to, nor an intended beneficiary of, the MOA, and therefore, Appellant failed to state a claim upon which relief could be granted. The Court of Appeals affirmed, holding that Appellant, at best an incidental beneficiary to the MOA, could not file a suit requesting declaratory judgment that interprets and enforces an agreement to which it had no part.

Heidi Schumacher signed a renewed lease with Meadowland Apartments. Meadowland later filed an eviction action against Schumacher, alleging that she was in material non-compliance with the lease because Schumacher kept a disruptive dog in her apartment. The magistrate court found that Schumacher's conduct constituted sufficient grounds for termination of the lease. The circuit court affirmed. The Supreme Court affirmed, holding that the magistrate court (1) did not abuse its discretion in denying Schumacher's motion for a continuance, as Schumacher was given a reasonable opportunity to secure evidence on her behalf; (2) did not abuse its discretion in considering evidence of incidents that occurred prior to the term of Schumacher's most recent lease with Meadowland; and (3) did not err in finding that Meadowland provided reasonable accommodations for Schumacher's disability as required under the Fair Housing Amendments Act.

Appellants Michael and Analisa Jones purchased a home with a loan from a mortgage company, which assigned the note and deed of trust to SunTrust Mortgage. After the Joneses defaulted on their mortgage, the Joneses elected to participate in the Foreclosure Mediation Program (FMP) provided for in Nev. Rev. Stat. 107.086. SunTrust and the Joneses resolved the pending foreclosure by agreeing to a short sale of the Joneses' home. The Joneses, however, never returned the short-sale documents and instead filed a petition for judicial review in the district court, requesting that the court impose sanctions against SunTrust because SunTrust violated section 107.086 and foreclosure mediation rules (FMRs) by failing to provide required documents and mediating in bad faith. The district court (1) denied the petition, finding that the Joneses entered into an enforceable short-sale agreement and therefore waived any claims under section 107.086 and the FMRs; and (2) allowed SunTrust to seek a certificate from the FMP to proceed with the foreclosure based on the terms of the short-sale agreement. The Supreme Court affirmed, holding that the short-sale agreement was an enforceable settlement agreement, and the district court did not abuse its discretion by refusing to impose sanctions against SunTrust.

Gary Fordham, David Thompson, and Venture Sales, LLC appealed a chancery court order that dissolved Venture Sales pursuant to Mississippi Code Section 79-29-802 (Rev. 2009). Walter Ray Perkins owned 27.7 acres of land. Sometime in the late 90s, he was approached by Fordham and Thompson about a potential business venture involving his land. Perkins, Fordham, and Thompson eventually agreed that Fordham and Thompson would acquire the 438 acres of land that adjoined Perkins's land; the parties would combine their respective land, along with some cash, and form a venture to develop the land. Following the contributions, the operating agreement of Venture Sales was revised to reflect the arrangement. The parties signed the new operating agreement in 2000. In February 2010, Perkins filed an application for judicial dissolution of Venture Sales. Following a trial, the chancellor found that, based on the property's history, the company's inability to get funding for development, and the uncertainty regarding the economic climate in the area, it was not reasonably practicable to carry on the business of Venture Sales. The chancellor therefore ordered the company dissolved. Upon review, the Supreme Court determined that the chancellor's decision to order the dissolution of Venture Sales was not an abuse of discretion: substantial evidence existed supporting the chancellor's determination that it was not reasonably practicable for Venture Sales to carry on business in conformity with its operating agreement.

Defendant-Respondent High Mark Development, LLC owned a commercial building located in the City of Ammon. In 2006, it had leased a portion of the building to The Children's Center, Inc., for a period of ten years. In 2007, High Mark listed the real property for sale through its realtor. Plaintiff-Appellant Thomas O'Shea, a resident of California, learned of the property through a realtor friend in Boise. Appellant and his wife were trustees of the "Thomas and Anne O'Shea Trust u/d/t Dated November 2, 1998," which they had formed to protect their assets and provide for their children. They decided to purchase the real property. The Trust entered into a real estate contract agreeing to purchase the property from Defendant High Mark for $3.7 million. The sale closed late 2007. The Children's Center made no payments to Plaintiffs after they acquired the property. Shortly thereafter, the Children's Center vacated the property, and went out of business. Plaintiffs filed suit against High Mark and two of its principals, Gordon, Benjamin and Jared Arave arguing Defendants had induced them to acquire the property by providing false information that the Children's Center was current in its payments of rent and/or concealing or failing to disclose that the Center had failed to pay all rent due under the lease. Plaintiffs alleged claims for breach of contract and fraud by misrepresentation and nondisclosure against all of the Defendants, but the issues were narrowed after cross motions for summary judgment. The case was tried to a jury on the issues of: High Mark's breach of contract; High Mark's alleged fraud by misrepresentation and nondisclosure; Gordon Arave's alleged fraud by misrepresentation and nondisclosure; and Benjamin Arave's alleged fraud by nondisclosure. The jury returned verdicts in favor of all of those Defendants. The Plaintiffs filed a motion for a judgment notwithstanding the verdict on the issue of liability or, in the alternative, for a new trial, which the district court denied. The Plaintiffs then timely appealed. Upon review, the Supreme Court concluded that the jury could reasonably have determined that the Plaintiffs failed to prove that they were damaged by the breach and that they failed to prove that the breach of contract caused any damages. In addition, the jury could have found that the breach did not cause any damages because the Plaintiffs did not have the right to terminate the contract for the misrepresentation in an estoppel certificate. Therefore, the district court did not err in denying the motion for a judgment notwithstanding the verdict on the breach of contract claim.

Debtor appealed an order of the Bankruptcy Court directing that a third party receive a portion of a check made payable jointly to the third party and debtor for rent of debtor's property. At issue was whether the third party had a right to funds for rent of debtor's property when the rent check was made payable jointly to debtor and the third party. The court held that the third party had an interest in the funds by virtue of a contract between the parties and, therefore, the third party was entitled to the portions of the funds that the bankruptcy court required debtor to remit to him.

Regent Investments sued Earline Waddle and Lorene Elrod alleging that Regent contracted to purchase real property from Waddle, but that afterwards Regent discovered Waddle had conveyed one-half of her interest in the property to Elrod. Waddle filed a cross-claim against Elrod, alleging that Elrod had acquired her interest in the property through undue influence. Regent later dismissed its claims. Waddle subsequently agreed to settle the case against Elrod by way of emails sent by the parties' attorneys. Elrod, however, refused to sign the settlement documents. The trial court entered an order enforcing the settlement agreement. Elrod appealed, arguing that the Statue of Frauds precluded enforcement of the settlement agreement. The court of appeals affirmed, reasoning that the Statute of Frauds applies only to contracts for the sale of lands. The Supreme Court affirmed on alternate grounds, holding (1) the Statute of Frauds applies to settlement agreements requiring the transfer of an interest in real property; but (2) the Statute of Frauds did not bar enforcement of the settlement agreement at issue in this appeal because the emails that the parties' counsel exchanged and the legal description of the property included in the cross claim satisfied the Statute of Frauds.

This appeal arose from a dispute between two neighboring property owners regarding a workshop addition to the home of Appellants, Neil and Seth Milner (Milner). The addition violated the city's setback requirement, and Appellee Gary Olsen reached an agreement with Milner to sell strip of his property so the building would be in compliance. The parties disagreed, however, about the terms of the agreement. Milner filed suit, and the district court rescinded and set aside the agreement. Olsen was ordered to return Milner's money and costs, and Milner was required to deed the land back to Olsen. After Olsen discovered that Milner's addition encroached past the boundary line of his property, Olsen filed suit alleging trespass and nuisance. The district court found in favor of Olsen and ordered Milner to remove the addition. The Supreme Court affirmed, holding that the district court did not err in determining (1) Olsen's claims were not barred by res judicata; (2) Olsen's claims were not barred by equitable estoppel or waiver; and (3) Milner was liable to Olsen for trespass.

The Mathewses conveyed a parcel of land by deed of trust to a credit union to secure a promissory note. PHH Mortgage Corporation subsequently became the holder of the note and the beneficiary of the deed of trust. After the Mathewses failed to make payments, PHH commenced foreclosure proceedings on the parcel. The Mathewses filed a complaint seeking a declaratory judgment that the foreclosure sale would be void because PHH had not satisfied conditions precedent to foreclosure set forth in the deed of trust. Specifically, they alleged that 24 C.F.R. 203.604 (the Regulation) required PHH to have a meeting with them thirty days before the commencement of foreclosure proceedings. The circuit court dismissed the complaint, concluding that the Regulation was incorporated into the deed of trust as a condition precedent to foreclosure but that, under Virginia common law, the party who breaches a contract first cannot sue to enforce it. The Supreme Court reversed in part, holding (1) borrowers may sue to enforce conditions precedent to foreclosure even if they were the first party to breach the note secured by a deed of trust through non-payment; and (2) the Mathewses pled sufficient facts for the Regulation to apply. Remanded.