Justia Contracts Opinion Summaries

Festival Fund guaranteed a loan made to an affiliate in connection with the purchase of a retail property. After default on the loan and a nonjudicial foreclosure, Clover sought to enforce the guaranty. The trial court concluded that the guaranty was unenforceable and found that Festival Fund was protected by antideficiency laws. The court concluded, however, that evidence does not support a conclusion that Festival Fund was a principal obligor on the loan. The court concluded, instead, that Festival Fund itself structured the transaction and determined that its affiliate—a separate legal entity—would take out the loan and take title to the property. Therefore, the trial court erred in applying a sham guaranty defense and entering judgment for Festival Fund. View "LSREF2 Clover Property 4 v. Festival Retail Fund 1" on Justia Law

In this appeal, the issue presented for the Supreme Court's review was whether a contractor could maintain an action under the Contractor and Subcontractor Payment Act (CASPA) against a property owner’s agents. Beginning in 2005, Appellant Scungio Borst & Associates (SBA) entered into a series of written and oral construction contracts with Appellee 410 Shurs Lane Developers, LLC (410 SLD), which 410 SLD’s part-owner and president, Appellee Robert DeBolt, executed on 410 SLD’s behalf. Therein, SBA agreed to improve real property owned by 410 SLD in connection with the development of a condominium complex, and did so until November 2006, when SBA’s contracts were terminated with approximately $1.5 million in outstanding payments due. SBA requested payment, but 410 SLD, again through DeBolt, refused. Accordingly, SBA sued 410 SLD; its alleged successor corporation, Appellee Kenworth II, LLC; and DeBolt in his personal capacity. SBA asserted, among other claims, violations of CASPA. After careful review, the Supreme Court held that a contractor could not maintain an action under CASPA, and, accordingly, affirmed the order of the Superior Court. View "Scungio Borst & Assoc. v. 410 Shurs Lane Developers, LLC" on Justia Law

After plaintiff sold a Mark Rothko painting to David Martinez through L&M Arts, she filed suit alleging that she was fraudulently induced into selling the painting with assurances of secrecy and that the eventual public re-sale of the painting constituted a breach of a confidentiality provision in her agreement with the original buyer. The court concluded that plaintiff failed to show that a genuine dispute of material fact exists regarding each element of Texas fraudulent inducement; L&M was entitled to judgment as a matter of law on plaintiff's breach-of-contract claim where the confidentiality clause did not require secrecy as to the fact of the 2007 sale, and the jury therefore did not hear evidence from which it could reasonably have found that L&M breached the Agreement; and even if a reasonable jury could have found that L&M breached the agreement, L&M would nevertheless be entitled to judgment as a matter of law because the jury’s damages award rested on a legally non-viable measure of damages. The court affirmed the district court’s grant of summary judgment for L&M on plaintiff's fraudulent inducement claim; affirmed the district court's judgment as a matter of law for the Martinez defendants on plaintiff's breach-of-contract claim; reversed the denial of judgment as a matter of law for L&M on plaintiff's breach-of-contract claim; and affirmed the denial of plaintiff's motion for attorney's fees under Texas Civil Practice & Remedies Code 38.001(8). The court remanded for further proceedings. View "Hoffman v. Martinez" on Justia Law

In 1985, South Alabama Sewer Service, Inc. ("SASS"), and Lake View Developers, Ltd. ("Lake View"), entered into an agreement where SASS would construct a sewer line from its waste-treatment facility to a new planned subdivision and golf course ("Lake View Estates). In 1989, Lake View filed for bankruptcy. The development and golf course, excluding lots that had already been sold, were placed in receivership. 1991, SASS and Lakeview Realty entered into a new sewer agreement. In July 2003, Baldwin County Sewer Service, LLC ("BCSS"), purchased from SASS the sewer lines and sewer facilities servicing Lake View Estates. In 2004, BCSS purchased all the stock of SASS. Subsequent to BCSS's purchase of SASS and its facilities in Baldwin County, all monthly sewer fees related to Lake View Estates had been billed by and paid to BCSS. Sometime following its acquisition of SASS's sewer system, BCSS enacted a rate increase affecting customers in Lake View Estates. In 2014, multiple homeowner associations whose members were property owners in Lake View Estates, sued BCSS, generally asserting that BCSS had violated the sewer-service-rate provision of the 1991 agreement. The associations lost at trial on grounds that they lacked standing to sue to enforce the 1991 agreement. The Supreme Court disagreed, reversed and remanded for further proceedings. View "The Gardens at Glenlakes Property Owners Association, Inc., et al. v. Baldwin County Sewer Service, LLC" on Justia Law

American Family Mutual Insurance Company (AFM) sought review of a Court of Appeals decision upholding the trial court's judgment in a garnishment proceeding requiring AFM to pay a judgment that plaintiffs FountainCourt Homeowners’ Association and FountainCourt Condominium Owners’ Association (FountainCourt) had obtained against AFM’s insured, Sideco, Inc. (Sideco). The underlying dispute centered on a housing development that was constructed between 2002 and 2004 in Beaverton. FountainCourt sued the developers and contractors seeking damages for defects in the construction of the buildings in the development. Sideco, a subcontractor, was brought in as a third-party defendant, and a jury eventually determined that Sideco’s negligence caused property damage to FountainCourt’s buildings. Based on that jury verdict, the trial court entered judgment against Sideco in the amount of $485,877.84. FountainCourt then served a writ of garnishment on AFM in the amount owed by Sideco, and, in response, AFM denied that the loss was covered by its policies. The trial court ultimately entered judgment against AFM, after deducting the amounts that had been paid by other garnishees. After review, the Supreme Court found no reversible error in the court of Appeals' judgment and affirmed the courts below. View "FountainCourt Homeowners v. FountainCourt Develop." on Justia Law

The State and the City of Pass Christian’s entered into a forty-year lease. Under the terms of the lease, the City would use a portion of the Harrison County shoreline as a harbor and pursue related commercial development. Russell RP Services, LLC, filed its complaint against the State and the City on November 21, 2013. Russell RP asserted that it held an undivided one-half interest in a parcel of land lying between U.S. 90 and the Gulf of Mexico shoreline, and that the City and State, by executing the aforementioned lease, had effectuated a taking upon its property which required just due compensation. On August 18, 2015, the Harrison County Circuit Court granted the State and City's motions for summary judgment. Concluding that Russell Real Property lacked standing to pursue its claim of inverse condemnation, the circuit court dismissed without prejudice its claim of inverse condemnation. Russell RP appealed, but finding no reversible error, the Supreme Court affirmed. View "Russell Real Property Services, LLC v. Mississippi" on Justia Law

Kenneth and Sally Eyer and Idaho Forest Group, LLC (IFG) entered into a Log Purchase Agreement in which IFG agreed to purchase timber harvested from the Eyers’ land. Before logging, IFG sent an agent to the Eyers’ property to assist them in locating property lines. When the logging occurred, the loggers mistakenly cut timber located on neighboring land. The neighbors sued the Eyers for timber trespass and the Eyers brought a third-party action against IFG for breach of an assumed duty to properly mark the property lines. A jury found in favor of IFG, finding that IFG had not assumed a duty to the Eyers. The district court then awarded IFG $95,608 in attorney fees. On appeal, the Eyers argued the district court erred in awarding fees under Idaho Code section 12-120(3), contending: (1) the gravamen of the Eyers’ complaint was not a commercial transaction; and (2) the Eyers did not sell timber for a “commercial purpose” since they used the proceeds of the sale to pay medical bills. Finding no reversible error, the Supreme Court affirmed. View "Eyer v. Idaho Forest Group" on Justia Law

This case centered around sixteen shares in the Malletts Bay Club, Inc. (MBC) that were sitting in escrow since 1998, when George Gordon conveyed the associated real property to J. Douglas Johnson. On summary judgment, the trial court ruled that defendant James McGarry, as transfer agent for the shares, breached the parties’ contract and his fiduciary duty by failing to issue the shares to Gordon’s successors upon their demand, and that defendant MBC had waived its right to challenge Gordon’s failure to transfer those shares to Johnson by agreeing to the Gordon-to-Johnson conveyance. After its review of this matter, the Vermont Supreme Court concluded that the agreement defining the parties’ rights and obligations with respect to the MBC shares did not require McGarry to return the shares to Gordon on demand, and that based on undisputed evidence, MBC did not waive its right to enforce its bylaws with respect to the transaction. Defendants were therefore entitled to summary judgment and plaintiffs were not. The Court remanded for further proceedings to resolve any remaining claims of plaintiffs that were not the subject of the cross motions for summary judgment. View "Rounds v. Mallets Bay Club, Inc." on Justia Law

Chris Wagner sued MSE Technology Applications, Inc. and related MSE entities (collectively, the MSE entities) and Butte Local Development Corporation (BLDC), alleging that they had improperly interfered with his attempt to purchase certain property to establish a commercial nursery. Plaintiff later amended his complaint to add Shea Relators as a defendant. The district court dismissed Wagner’s claims at trial pursuant to Mont. R. Civ. P. 50. The Supreme Court affirmed in part and reversed in part, holding that the district court (1) did not err in granting judgment as a matter of law to the MSE entities and BLDC; but (2) erred in granting Shea Realtors summary judgment and judgment as a matter of law. Remanded. View "Wagner v. MSE Technology Applications, Inc." on Justia Law

Williams Alaska Petroleum owned the North Pole refinery until 2004. Williams knew that the then-unregulated chemical sulfolane was present in refinery property groundwater, but it did not know that the sulfolane had migrated off the refinery property via underground water flow. Flint Hills Resources Alaska bought the North Pole refinery from Williams in 2004 pursuant to a contract that contained detailed terms regarding environmental liabilities, indemnification, and damages caps. Almost immediately the Alaska Department of Environmental Conservation informed Flint Hills that sulfolane was to be a regulated chemical and that Flint Hills needed to find the source of the sulfolane in the groundwater. The Department contacted Flint Hills again in 2006. Flint Hills’s environmental contractor repeatedly warned Flint Hills that sulfolane could be leaving the refinery property and that more work was necessary to ascertain the extent of the problem. In 2008, Flint Hills drilled perimeter wells and discovered the sulfolane was migrating beyond its property and had contaminated drinking water in North Pole. A North Pole resident sued Flint Hills and Williams, and Flint Hills cross-claimed against Williams for indemnification. After extensive motion practice the superior court dismissed all of Flint Hills’s claims against Williams as time-barred. Flint Hills appealed. After review, the Supreme Court held that the superior court correctly applied the contract’s damages cap provision, but concluded that the court erred in finding Flint Hills’s contractual indemnification claims and part of its statutory claims were time-barred. The Court also affirmed the court’s dismissal of Flint Hills’s equitable claims. View "Flint Hills Resources Alaska, LLC v. Williams Alaska Petroleum, Inc." on Justia Law