Justia Contracts Opinion Summaries

A fire damaged a malt beverage store owned by A Maxon Company, LLC (AMC). Acuity Insurance Company sought a declaratory judgment to determine coverage under an insurance policy listing Greg and Tammy Weatherspoon as additional loss payees. The Weatherspoons counterclaimed for breach of contract. The circuit court granted Acuity’s motion for judgment as a matter of law on the Weatherspoons’ counterclaim, determining that the insurance policy terms prevented the Weatherspoons from recovering damages unless AMC successfully asserted a claim. The jury found that AMC principal, Russel Maxon, had intentionally started the fire, excluding coverage under AMC’s policy. The Weatherspoons appealed.The Circuit Court of the Fourth Judicial Circuit, Corson County, South Dakota, initially denied the Weatherspoons’ motion for summary judgment, ruling that the insurance contract was unambiguous and that the Weatherspoons’ claim was dependent on AMC’s claim. The court also denied Acuity’s motion for summary judgment, finding that there were factual disputes suitable for a jury. At trial, the court granted Acuity’s motion for judgment as a matter of law, concluding that the Weatherspoons could not recover under the policy because AMC’s claim was excluded due to Russel’s intentional act.The Supreme Court of the State of South Dakota affirmed the circuit court’s decision. The court held that the insurance policy’s Loss Payable Clause only allowed the Weatherspoons to collect if AMC could collect, and since the jury found that Russel intentionally started the fire, AMC was precluded from recovering. The court also found no abuse of discretion in admitting expert testimony from Special Agent Derek Hill and allowing the impeachment of Tracy Maxon with prior inconsistent statements. The court concluded that the Weatherspoons’ arguments regarding ambiguity and third-party beneficiary status were unavailing. View "Acuity Insurance V. A Maxon Company" on Justia Law

FDJ, LLC, Richard Flugge, and LeAnn Julius (Plaintiffs) sued Ross Determan, alleging he breached a covenant not to compete after selling his accounting practice to them. Determan counterclaimed, asserting the LLC failed to make required payments under their purchase agreement. The circuit court found the LLC breached the agreement by not making payments, which voided Determan's non-compete obligation. The court awarded Determan $106,972.36 and held Plaintiffs jointly and severally liable.The circuit court determined that the LLC failed to make payments to Determan after May 2018, which constituted a material breach of the purchase agreement. This breach relieved Determan of his obligations under the non-compete clause. The court found that Determan resumed working for former clients only after the LLC stopped payments, and Plaintiffs did not provide sufficient evidence to justify withholding payments for alleged expenses.The Supreme Court of South Dakota reviewed the case and affirmed the judgment against the LLC but reversed the imposition of joint and several liability against Flugge and Julius individually. The court held that the purchase agreement explicitly stated the LLC was responsible for payments to Determan, and there was no basis to hold Flugge and Julius personally liable. The court also noted that Determan did not allege facts to justify disregarding the corporate entity, and the circuit court did not provide findings to support such a decision. Thus, the judgment was affirmed in part and reversed in part. View "FDJ, LLC v. Determan" on Justia Law

Dakota Bail Bonds (DBB) posted bonds for two criminal defendants who violated their conditions of release but did not fail to appear in court. The circuit court forfeited the bonds, interpreting SDCL 23A-43-21 as requiring forfeiture for any material breach of release conditions. DBB requested the forfeiture be set aside under SDCL 23A-43-22, arguing their surety only guaranteed court appearances, not compliance with all conditions of release. The circuit court denied this request and entered orders forfeiting the bonds.The circuit court, part of the Second Judicial Circuit in Lincoln County, South Dakota, determined that the statutory language did not distinguish between types of bonds and required forfeiture for any breach of release conditions. The court also declined to set aside the forfeiture, reasoning that justice did not warrant such action merely because the defendants complied with court appearance requirements but violated other conditions. Consequently, the court entered judgments of default against DBB.The Supreme Court of the State of South Dakota reviewed the case. It held that the circuit court erred in its interpretation of the surety bond's language. The Supreme Court found that DBB's surety bond explicitly guaranteed only the defendants' court appearances, not compliance with all conditions of release. Since the defendants did not fail to appear in court, there was no violation of the condition guaranteed by DBB. Therefore, the Supreme Court concluded that the circuit court should have set aside the forfeiture under SDCL 23A-43-22 and vacated the judgment of default against DBB. The Supreme Court reversed the circuit court's decision and remanded the case with instructions to vacate the judgment of default. View "State v. Dakota Bail Bonds" on Justia Law

The case involves a dispute between Julie and Gary Liebel, who married in 2010 and divorced in 2022. Prior to their marriage, they had signed a premarital agreement stating that each party's assets would remain separate and under their sole control, even after the marriage. The agreement also stated that neither party would acquire any interest in the other's property due to the marriage. The couple divorced on the grounds of adultery, and the circuit court applied the premarital agreement in dividing their assets. Julie appealed, arguing that the court erred in applying the agreement to the property division in the divorce and abused its discretion in classifying and distributing the parties’ property.The circuit court had found the premarital agreement to be valid and enforceable in the context of divorce. It also found that the agreement unambiguously governed the division of property in the event of divorce. The court treated the marital home, which was held jointly, as marital property, but most of the remaining property was treated as nonmarital. Gary received the bulk of the nonmarital property valued at $713,705. Upon division of the net marital assets, Julie was awarded marital property valued at $35,482, while Gary received marital property valued at $134,535. The court ordered Gary to make a cash equalization payment to Julie in the amount of $49,526, less $2,062.80 in attorney fees awarded to Gary for defending a protection order that the court determined Julie filed maliciously.The Supreme Court of the State of South Dakota affirmed the lower court's decision. It found that the premarital agreement unambiguously provided that neither spouse may claim an interest in the separate property of the other, whether it was acquired before or during the marriage. This could only be understood to mean that the other spouse would not obtain any interest in separately owned property under any circumstances, including divorce, unless mutually agreed to by creating a joint tenancy in any property. The court also found no abuse of discretion in the lower court's division of property. View "Liebel v. Liebel" on Justia Law

The case involves Scotlynn Transport, LLC and Plains Towing and Recovery, LLC, disputing the ownership of a semi-tractor. The semi-tractor, owned by Scotlynn, was involved in an accident and subsequently towed by Plains Towing to its impound lot. After Scotlynn paid for the towing services and took possession of the trailer, the semi-tractor remained at the impound lot. Plains Towing, considered a "removal agency" under South Dakota law, sent a notice to Scotlynn and later acquired the title to the semi-tractor using the statutory procedure outlined in SDCL 32-36-8 and 32-36-9. Scotlynn initiated a lawsuit against Plains Towing, alleging several claims related to the disputed ownership of the semi-tractor.The Circuit Court of the Fourth Judicial Circuit, Meade County, South Dakota, granted Plains Towing's motion for summary judgment, concluding that Plains Towing had complied with SDCL 32-36-8 and lawfully obtained the title to the semi-tractor. Scotlynn appealed, arguing that there were genuine issues of material fact relating to claims raised in Scotlynn’s complaint that were not addressed by the court.The Supreme Court of the State of South Dakota partially reversed and affirmed the lower court's decision. The court found that there were genuine issues of material fact concerning the existence of an implied contract between the parties regarding the storage of the tractor. However, the court agreed with the lower court that the "drafting errors" Scotlynn alleged were contained in the notice would not, themselves, preclude obtaining the title under SDCL 32-36-9. The case was remanded for further proceedings consistent with the court's holdings. View "Scotlynn Transport, LLC v. Plains Towing and Recovery, LLC" on Justia Law

The case revolves around a dispute over the estate of Neil Smeenk. Denise Schipke-Smeenk, Neil's wife, and Ryan Smeenk, Neil's son, are the parties involved. Denise and Neil had executed mutual and reciprocal wills in 2017, along with an agreement that neither would revoke or amend their wills without the other's written consent. However, after their relationship deteriorated, Neil executed a new will without Denise's consent, disinheriting her to the extent allowed under South Dakota law and naming his children as the primary beneficiaries. Neil passed away shortly after. Denise filed a petition for formal, unsupervised probate concerning the 2017 will, and Ryan filed a competing petition to probate the 2019 will.The circuit court determined that Neil's 2019 will was valid and should be admitted into probate. The court concluded that the couple's agreement did not render Neil's 2017 will irrevocable, though it may subject his estate to liability. Denise later filed a motion for approval of a creditor claim in which she proposed to distribute Neil's estate according to the terms of his 2017 will. The circuit court conducted a court trial regarding Denise’s claim, but ultimately denied Denise’s claim, stating that Denise did not demonstrate that the circumstances supported the equitable remedy of specific performance.In the Supreme Court of the State of South Dakota, Denise appealed the circuit court's decision. The Supreme Court affirmed the circuit court’s decision to deny Denise’s claim after a court trial. Denise then filed a motion for partial summary judgment relating to her breach of contract claim against the estate of her deceased husband, Neil Smeenk. She changed the type of relief she was requesting; she was now seeking money damages for the breach instead of the specific performance remedy she had pursued unsuccessfully in the previous case. However, the circuit court concluded that Denise was barred from litigating her breach of contract claim against Neil’s estate. Denise appealed this decision, but the Supreme Court affirmed the circuit court's decision, stating that Denise had a complete and fair opportunity to litigate her breach of contract claim in the prior proceeding. View "Estate Of Smeenk" on Justia Law

In South Dakota, realtor Joshua Uhre, who owns Uhre Realty Corporation (URC) and Uhre Property Management Corporation (UPM), had a dispute with Benjamin and Leslie Tronnes over the sale of their property. The Tronneses had contracted with Uhre to sell their property and entered into a property management agreement that authorized Uhre to lease and manage the property if it did not sell. After the property was leased to a tenant, the Tronneses sold the property directly to the tenant after the listing agreement expired. Uhre claimed that his realty company was entitled to a sales commission and that his property management company was entitled to a management fee for the entire lease agreement, despite its early termination. Uhre sued the Tronneses for breach of the listing agreement, breach of the management agreement, and civil conspiracy. The Tronneses counterclaimed, alleging that Uhre and his companies had interfered with their business expectation with the tenant.The Supreme Court of the State of South Dakota held that Uhre was not entitled to a sales commission because he did not procure a ready, willing, and able buyer during the term of the listing agreement. The court also rejected Uhre's argument that the lease agreement gave him an option to buy the property, finding that it did not contain the necessary terms for a valid option contract. Additionally, the court found that the Tronneses did not breach the implied covenant of good faith and fair dealing. Regarding the management agreement, the court ruled in favor of the Tronneses, stating that Uhre was only entitled to 10% of the monthly rent that had accrued through June 3, 2021, which he had already received. Finally, the court reversed the lower court's determination that the Tronneses were entitled to attorney fees, finding that the listing agreement only authorized fees in the event of a breach of contract. View "Uhre Realty V. Tronnes" on Justia Law

Austin McGee was involved in a car accident on a stretch of Highway 45 in South Dakota that was undergoing resurfacing. He claimed that the accident was caused by a negligent failure by the South Dakota Department of Transportation (DOT) and several of its employees to ensure that the contractor responsible for the resurfacing complied with DOT standards and industry practices. The DOT argued that sovereign immunity protected it from the lawsuit. The Supreme Court of South Dakota affirmed the lower court's decision that McGee could sue the DOT and its employees, rejecting the DOT's arguments that McGee lacked standing as a third-party beneficiary of the contract between the DOT and the contractor, and that McGee failed to establish an actionable duty. The court found that the DOT had a ministerial duty under its own Standard Specifications not to exceed the estimated amount of tack coating to be applied each day, but found no ministerial duties relating to the use of precautionary measures. Thus, the Supreme Court of South Dakota affirmed in part, reversed in part, and remanded for further proceedings. View "Mcgee V. Spencer Quarries" on Justia Law

The Supreme Court affirmed in part and reversed in part the judgment of the circuit court granting the motion brought by Robert and Shannon Bathurst to dismiss the underlying lawsuit because a statute of limitations barred Linda Paul from bringing her claim against them, holding that dismissal was improper.Paul brought this action against Robert, Shannon, and Stonemeadow Ranch, LLC, alleging breach of contract, quantum merit, unjust enrichment, and promissory estoppel. Shannon and Robert moved to dismiss for failure to state a claim and, in the alternative, argued that Paul's claims were time-barred by the statute of limitations set forth in S.D. Codified Laws 15-2-15(4). The Supreme Court applied a two-year statute of limitations and granted the motion to dismiss based on the alternative argument of the statute of limitations. The Supreme Court reversed in part, holding (1) the record did not allow a determination of which statute of limitation applied at this early stage of the proceedings; and (2) the circuit court did not err when it denied the motion to dismiss for failure to state a claim upon which relief could be granted. View "Paul v. Bathurst" on Justia Law

The Supreme Court affirmed on appeal two orders of the circuit court in which the court denied the requests brought by Mark and Annessee Brockley to hold Michael Trucano, the Michael J. Truman Living Trust, and Hickoks Hotel & Suites, LLC in contempt, holding that there was no error.The Brockleys sued several entities seeking the amount remaining due on a contract. The circuit court granted partially summary judgment in favor of the Brockleys. At issue was the circuit court's charging order directing an entity that later changed its name to Hickoks to pay certain distributions owed to the Brockleys. The Brockleys filed motions for an order to show cause claiming that several defendants should be held in contempt for violating the charging order. The circuit court denied the motion. The Supreme Court affirmed, holding that the circuit court was not clearly erroneous when it found that neither Trucano, the Trucano Trust, nor Hickoks willfully or contumaciously violated the charging order. View "Brockley v. Ellis" on Justia Law