Justia Contracts Opinion Summaries

Starting in February of 2014, Philip McGimpsey (“McGimpsey”) and his wife Jolene leased a home from D&L Ventures, Inc. D&L was a Nevada corporation owned by David Asher and his wife Georgina. The residential property McGimpsey leased from D&L was located in Eagle, Idaho. D&L obtained the Property in a 2013 foreclosure sale and received a trustee’s deed, which excluded any warranties. A dispute arose out of a breach of contract claim between the McGimpsey and D&L, who entered into a combined lease/Buy-Sell Agreement for the property. On discovering that D&L was an unregistered Nevada corporation conducting business in Ada County, McGimpsey failed to close on the purchase of the home in 2017, because he believed D&L to be in violation of Idaho Code section 30-21-502(a). After the closing date passed, D&L informed McGimpsey that the contractual provisions terminated upon his failure to close and reminded McGimpsey he had to vacate the property, pursuant to the Buy-Sell Agreement. About a month later, D&L registered with the Idaho Secretary of State as a Nevada corporation and filed all of its tax returns and paid its other obligations. McGimpsey subsequently filed a complaint against D&L, and the corporation counterclaimed against McGimpsey and third-party defendants. D&L moved for summary judgment that was granted in part and denied in part. The district court ultimately concluded that D&L had the legal ability to convey the property via warranty deed and that McGimpsey breached the Buy-Sell Agreement by failing to close and failing to show that his breach was excused by D&L’s alleged inability to convey marketable title. McGimpsey and third-party defendants timely appealed and their appeals were consolidated. The Idaho Supreme Court affirmed the district court’s award of summary judgment to D&L because Idaho Code section 30- 21-502 did not impair the validity of contracts; therefore, D&L had the legal ability to convey the property via warranty deed. View "McGimpsey v. D&L Ventures" on Justia Law

The Supreme Court affirmed the circuit court's order granting summary judgment to LML Properties, LLC on Hanover Resources, LLC's complaint alleging breach of contract against LML for enforcement of $4.7 million in mechanic's liens on the basis that the mechanic's liens were invalid under West Virginia law, holding that the mechanic's liens at issue were invalid.The liens in this case were filed under W. Va. Code 38-2-31 and -32 by Hanover, a provider of coal mining services, against the fee interest of a mineral estate partially owned by LML. The circuit court concluded that the liens were invalid and granted summary judgment to LML. The Supreme Court affirmed after considering the undisputed facts in the form of stipulations by the parties regarding their contractual responsibilities along with the framework in the mechanic's lien statutes and relevant case law, holding that the circuit court did not err in granting LML's motion for summary judgment. View "Hanover Resources, LLC v. LML Properties, LLC" on Justia Law

The Supreme Court reversed the order of the district court denying Plaintiffs' motion for summary judgment in this case alleging a violation of Article 9A of Montana's adopted version of the Uniform Commercial Code (UCC), holding that the district court erred when it concluded that Article 9 no longer applied to the agreement between the parties.Plaintiffs and Defendants entered into an installment sale contract and security agreement to buy a mobile home. When Plaintiffs continually missed payments on the mobile home Defendants sent a notice of default and then demanded the outstanding balance on the agreement. Plaintiffs moved out of the mobile home and voluntarily returned it to Defendants. After Defendants sold the mobile home to a new buyer Plaintiffs brought suit alleging that Defendants violated provision of Article 9A. The district court denied Plaintiffs' motion for summary judgment and entered judgment in favor of Defendants. The Supreme Court reversed, holding that there were no genuine issues of material fact as to Defendants' UCC violations, and Plaintiffs were entitled to judgment as a matter of law on that issue. View "Christman v. Clause" on Justia Law

The federal United States District Court for the Middle District of Georgia certified questions of Georgia law to the Georgia Supreme Court regarding the scope of the “acceptance doctrine” in negligent construction tort cases. At issue was whether and how the acceptance doctrine applied as a defense against a claim brought by a subsequent purchaser of allegedly negligently constructed buildings. Thomaston Crossing, LLC (the “original owner”) entered into a construction contract with appellee Piedmont Construction Group, Inc. to build an apartment complex in Macon. Piedmont then retained two subcontractors – appellees Alan Frank Roofing Company and Triad Mechanical Company, Inc. – to construct the roof and the HVAC system, respectively. In 2014, the complex was completed, turned over to, and accepted by the original owner. In 2016, the original owner sold the apartment complex to appellant Thomaston Acquisition, LLC (“Thomaston”) pursuant to an “as is” agreement. Shortly after the sale, Thomaston allegedly discovered evidence that the roof and HVAC system had been negligently constructed. Thomaston filed suit against Piedmont, asserting a claim for negligent construction of the roof and HVAC system and a claim for breach of contract/implied warranty. Piedmont then filed a third-party complaint against Alan Frank Roofing and Triad Mechanical because both companies had allegedly agreed to indemnify Piedmont for loses arising out of their work. Each of the appellees later moved for summary judgment based in part on the defense that Thomaston’s negligent construction claim is barred by the acceptance doctrine. The Georgia Supreme Court concluded the acceptance doctrine applied to Thomaston’s claim, and that “readily observable upon reasonable inspection” referred to the original owner’s inspection. “Without any real claim of privity, Thomaston nevertheless contends that it should be treated like the original owner because it is the current owner-occupier of the property. But doing so would undermine the acceptance doctrine’s foundational purpose of shielding contractors from liability for injuries occurring after the owner has accepted the completed work, thereby assuming responsibility for future injuries. There is no ‘current owner-occupier’ or ‘subsequent purchaser’ exception to the acceptance doctrine, and the facts of this case do not compel us to recognize one here.” View "Thomaston Acquisition, LLC v. Piedmont Construction Group, Inc." on Justia Law

Plaintiffs David and Lisa McDaniel petitioned the Alabama Supreme Court for a writ of mandamus to direct the Shelby Circuit Court to vacate its order staying the proceedings against defendants Southern Craftsman Custom Homes, Inc. ("SCCH"); Jeffrey Rusert; Larry Curry, Sr.; SouthFirst Bancshares, Inc., d/b/a SouthFirst Bank ("SouthFirst"); Mari Gunnels; and Danny Keeney. At the time of this opinion, Rusert was awaiting the outcome of a federal criminal investigation against him. In 2017, the McDaniels contacted Rusert for the purpose of entering into an agreement with SCCH to build a house. According to the McDaniels, Rusert represented himself as the president of SCCH. At some point, Rusert recommended that the McDaniels speak with Gunnels, who worked for SouthFirst, to secure a loan to pay for the construction of the new house. In November 2017, with Gunnels's assistance, the McDaniels began the process of applying for a construction loan with SouthFirst. The loan closing occurred on January 26, 2018. The McDaniels executed, among other agreements, a written construction-loan agreement, a promissory note, and a construction-loan disbursement agreement. The McDaniels met with Rusert to discuss some concerns they had with the ongoing construction. During that meeting, Rusert provided the McDaniels with a credit application from a local building-supply company and asked them to execute it so that, he said, he could use the McDaniels' credit to purchase building materials and supplies. The McDaniels learned that the company refused to do business with SCCH, Rusert, and Curry because all three had purportedly failed to pay significant amounts owed the company. The McDaniels immediately contacted Gunnels and placed a "stop-payment" order on the most recent draw request from SCCH and Rusert. Thereafter, the McDaniels sued SCCH, Rusert, Curry, SouthFirst, Gunnels, and Keeney. In their complaint, the McDaniels sought damages for negligence, suppression, fraudulent misrepresentation, civil conspiracy, conversion, and the infliction of emotional distress. The McDaniels further alleged breach-of-contract claims against SouthFirst, SCCH, Rusert, and Curry, as well as a claim of breach of fiduciary duties against SouthFirst. Finally, the McDaniels sought a judgment against SouthFirst, Gunnels, and Keeney declaring the loan agreement and mortgage void. Rusert and SCCH moved to stay the civil proceedings against them pending the outcome of a federal criminal investigation against Rusert, which the trial court granted. The Alabama Supreme Court determined, however, the McDaniels established a clear legal right to relief from the trial court's order. Accordingly, the Supreme Court granted the petition for a writ of mandamus and directed the trial court to vacate its order staying the underlying case. View "Ex parte David and Lisa McDaniel." on Justia Law

The Supreme Court reversed the decision of the court of appeals reversing the judgment of the trial court awarding specific performance to Pathfinder Oil & Gas, Inc., which claimed a twenty-five percent working interest in certain mineral leases under a letter agreement that Great Western Drilling Ltd. claimed was unenforceable, holding that Pathfinder was entitled to specific performance.On the day before trial, the parties stipules that only certain issues would be submitted to the jury and that favorable jury findings would entitle Pathfinder to specific performance instead of money damages. The jury charge included only the specifically enumerated jury issues, and the jury answered those issues in favor of Pathfinder. The trial court awarded specific performance as provided by the parties' agreement. The court of appeals reversed and rendered a take-nothing judgment, holding that specific performance was unavailable without a jury finding that Pathfinder was "ready, willing, and able" to perform its obligations under the contract. The Supreme Court reversed, holding that, through the stipulation, Great Western waived the right to insist on any other fact findings that might otherwise have been required to entitle Pathfinder to specific performance. View "Pathfinder Oil & Gas, Inc. v. Great Western Drilling, Ltd." on Justia Law

David Kosmann appealed a district court judgment relating to a dispute that arose from the sale of real property. He claimed the district court erred in enforcing an oral settlement agreement reached in mediation between Kosmann, Kevin Dinius, and Dinius & Associates, PLLC (collectively “Dinius”). Kosmann also argued the trial court erred in: (1) awarding attorney fees to Dinius as a sanction against Kosmann and his attorney; (2) declining to impose sanctions against Dinius and his attorney; and (3) striking an untimely memorandum and declaration in support of his motion to reconsider. After review of the trial court record, the Idaho Supreme Court affirmed in part and reversed in part. The Supreme Court determined the district court did not err in enforcing the settlement agreement; the court also did not err in declining to impose sanctions against Dinius on ethics violations. However, the Supreme Court determined the district court abused its discretion in imposing I.R.C.P. 11 sanctions against Kossman and his counsel: the district court did not act consistently with the applicable legal standard for imposing sanctions pursuant to I.R.C.P. 11(b). The Supreme Court declined to address all other issues Kossman raised, and determined he was not entitled to attorney fees on appeal. "The record in this case is so tarnished with questionable conduct that it has presented this Court with a vexing ethical and legal dilemma. While we are gravely concerned over the potential ethical lapses which allegedly occurred during the mediation of this matter, there are no findings in the record concerning these matters. Therefore, as the trial court determined, we will leave to the Idaho State Bar, if properly called upon, the responsibility to investigate this matter further and make the necessary findings and conclusions as to the ethical issues presented." View "Kosmann v. Dinius" on Justia Law

After plaintiffs filed suit against the Association and property manager for breach of contract and negligence, the trial court granted a nonsuit. Plaintiffs settled with the property manager but appealed against the association.The Court of Appeal reversed the trial court's grant of a nonsuit on the breach of contract claim where reasonable jurors could have concluded a total failure to maintain common areas breached a promise to keep these areas in first class condition and a jury could also find that buildings need maintenance to remain in first class condition. Furthermore, the trial court erred by adding oral reasoning beyond the contents of the nonsuit motion, and neither the motion nor the trial court's rationale challenged the idea that covenants, conditions, and restrictions comprise a contract between the association and individual owners. Nor did the motion or rationale hint at the rule of deference governing owner suits against homeowner associations. The court affirmed the nonsuit tort judgment and held that the association had no independent duty as to the pipes and roof arising from tort law. View "Sands v. Walnut Gardens Condominium Assn." on Justia Law

The Supreme Court affirmed the judgment of the court of appeals finding that Petitioner waived the argument that his contractual waiver of the statute of limitations was void as against public policy, holding that the court of appeals erred in declining to reach Petitioner's argument but that, when the enforceable portions of Petitioner's contractual waiver were applied, limitations did not bar Respondent's suit against Petitioner.Petitioner guaranteed a loan secured by real property. When the borrower defaulted, Respondent Wells Fargo Bank, N.A.'s successor foreclosed on the real property securing the loan. After purchasing property at a foreclosure sale Respondent sued Petitioner to recover the deficiency. Petitioner moved for summary judgment, arguing that Respondent's claim was barred by the two-year statute of limitations for deficiency claims. Respondent moved for partial summary judgment on the grounds that Petitioner waived Tex. Prop. Code 51.003's statute of limitations when he signed the guaranty agreement. The trial court granted summary judgment for Respondent. The court of appeals affirmed, holding that Petitioner waived his public policy argument. The Supreme Court affirmed, holding (1) Petitioner contractually waived the two-year statute of limitations and that a four-year statute of limitations applied to Respondent's claims; and (2) because Respondent sued Petitioner within that four-year period, limitations did not bar the suit. View "Godoy v. Wells Fargo Bank, N.A." on Justia Law

In this contract dispute stemming from a seller-financed real estate transaction, the Supreme Court affirmed in part and reversed in part the judgment of the district court, holding primarily that the district court was not precluded by the mandate rule from determining that the promissory note did not require the buyers to pay any incurred late fee amounts to bring note current because the court construed an ambiguity in the note against the defendants, as drafters, without first considering extrinsic evidence.The buyers purchased the real estate with a promissory note that required them to make an installment payment each month and a final balloon payment. The note applied a ten percent base interest rate on the unpaid principal and established consequences if the buyers missed an installment payment, including a late fee and bump up in the base interest rate until the note was brought current. The buyers made the installment payments but disagreed over the amount owing the final balloon payment, leading to litigation. The Supreme Court remanded the case for a new determination after the court considers relevant extrinsic evidence and held that the district court did not clearly err in determining that extrinsic evidence showed that the parties did not intent the note's late fee to apply to the final payment. View "Brady v. Park" on Justia Law