Justia Contracts Opinion Summaries

Hexagon US Federal, Inc. ("HexFed") leased a portion of a building from Intergraph Unimproved Properties, LLC in 2015. The lease included two bays with different terms and renewal options. In 2016, the lease was amended to provide a five-year term for both bays. CBS Holdings, LLC later acquired the building and the lease. A dispute arose over whether HexFed had validly renewed the lease, leading HexFed to file a lawsuit against CBS Holdings for breach of the lease agreement.The Madison Circuit Court held a bench trial and ruled in favor of HexFed, finding that CBS Holdings had waived its right to argue that the lease for one of the bays had expired after 12 months. The court also reformed the lease to correct a mutual mistake, establishing that the maximum monthly rent for the bay did not expire after one year. The court declared that HexFed had properly exercised its renewal option and awarded HexFed costs and attorneys' fees.The Supreme Court of Alabama reviewed the case and affirmed the lower court's judgment. The court held that CBS Holdings had waived its argument about the lease term by accepting rent without objection and by executing a lease amendment without changing the lease term. The court also upheld the reformation of the lease, finding clear evidence of a mutual mistake. Additionally, the court agreed that HexFed had validly renewed the lease by providing timely written notice, despite an error in the rent calculation. Finally, the court affirmed the award of costs and attorneys' fees to HexFed, as it was forced to file the action to enforce the lease. View "CBS Holdings, LLC v. Hexagon US Federal, Inc." on Justia Law

In this case, Universal Development Corporation ("Universal"), Hatti Group RE, LLC ("Hatti Group"), and Harsha Hatti separately appealed judgments entered by the Jefferson Circuit Court in favor of Robbie Dellinger following a jury trial. The trial involved consolidated cases with claims asserted by Hatti, the Hatti Group, and Dellinger.The Jefferson Circuit Court had previously dismissed Universal from Dellinger's initial action against Hatti and the Hatti Group. However, Universal was later brought back into the litigation when Hatti and the Hatti Group filed a separate action against Dellinger, Universal, and others. The cases were consolidated, and Dellinger asserted a breach-of-contract cross-claim against Universal. The jury found in favor of Dellinger on his claims against Universal and Hatti, awarding him compensatory and punitive damages.The Supreme Court of Alabama reviewed the appeals. It dismissed the appeals of Hatti Group and Hatti, noting that Hatti's appeal in Hatti v. Universal was invalid because no adverse judgment was entered against Hatti in that case. Hatti's appeal in Dellinger v. Hatti was dismissed as untimely because it was filed more than 42 days after the final judgment.Regarding Universal's appeal, the court reversed the judgment against Universal and rendered a judgment in its favor. The court held that Dellinger's breach-of-contract claim against Universal was void because it was based on work performed without a general contractor's license, violating Alabama's licensure statutes. The court concluded that Dellinger acted as a general contractor under the Personal Services Agreement with Hatti, and since Dellinger was unlicensed, the contract was void as a matter of public policy. Consequently, Universal had no legal obligation to support Dellinger in seeking payments under an unenforceable contract. View "Universal Development Corporation v. Dellinger" on Justia Law

In February 2019, the Colberts entered into a real-estate sales contract with A & W Contractors, LLC to purchase a remodeled 54-year-old house. A home inspection revealed issues with the plumbing, septic system, and electrical wiring. The parties amended the contract to address these issues, and A&W claimed to have made the necessary repairs. Despite lingering concerns, the Colberts proceeded with the purchase after A&W's real-estate agent allegedly offered a three-month builder's warranty. After moving in, the Colberts experienced significant problems with the house's systems and spent approximately $90,000 on repairs.The Colberts sued A&W, and the case went to trial in the Jefferson Circuit Court. The jury found in favor of the Colberts on their breach-of-contract and fraud claims, awarding them compensatory and punitive damages. The trial court entered a judgment on the jury's verdict and denied A&W's post-trial motions to alter, amend, or vacate the judgment or for a new trial.The Supreme Court of Alabama reviewed the case. It held that the trial court erred in granting a judgment as a matter of law (JML) in favor of the Colberts on their breach-of-contract claim, as there was conflicting evidence that should have been resolved by the jury. However, the Supreme Court affirmed the jury's verdict on the fraudulent misrepresentation and fraudulent suppression claims, noting that A&W had failed to preserve certain evidentiary and sufficiency-of-the-evidence arguments for appellate review. The case was affirmed in part, reversed in part, and remanded for further proceedings consistent with the opinion. View "A & W Contractors, LLC v. Colbert" on Justia Law

In 2014, several homeowners' associations sued Baldwin County Sewer Service, LLC (BCSS), alleging that a rate increase violated a 1991 agreement between a real-estate developer and BCSS. The plaintiffs sought a declaratory judgment and specific performance of the agreement. The case has been brought before the Supreme Court of Alabama multiple times, with BCSS repeatedly questioning whether the plaintiffs are successors in interest to the original contract party.The Baldwin Circuit Court initially granted summary judgment in favor of BCSS, stating that the plaintiffs lacked standing. However, the Supreme Court of Alabama reversed this decision in 2016, clarifying that the issue was not one of standing but whether the plaintiffs were real parties in interest. On remand, BCSS continued to challenge the plaintiffs' status, leading to multiple nonfinal rulings and additional appellate proceedings. The circuit court denied BCSS's summary judgment motions on this issue multiple times, including in August 2023.The Supreme Court of Alabama reviewed BCSS's petition for a writ of mandamus, which sought to compel the circuit court to grant summary judgment in its favor. The Court clarified that the real-party-in-interest question does not implicate the trial court's subject-matter jurisdiction and is not appropriate for mandamus review. The Court emphasized that such issues should be resolved through a final judgment by the trial court. Consequently, the Supreme Court of Alabama denied BCSS's petition for a writ of mandamus. View "Ex parte Baldwin County Sewer Service, LLC" on Justia Law

Radiance Capital Receivables Twelve, LLC ("Radiance") appealed a judgment from the Henry Circuit Court in favor of Bondy's Ford, Inc. ("Bondy's"). Radiance had garnished the wages of David Sherrill, who worked for Bondy's. Bondy's stopped paying on the garnishment, claiming Sherrill had left its employment, but continued to pay for Sherrill's services through a company created by Sherrill's wife. Radiance argued that Bondy's should still comply with the garnishment by withdrawing funds owed for Sherrill's services.The Henry Circuit Court had initially entered a garnishment judgment in favor of SE Property Holdings, LLC, which was later substituted by Radiance. Bondy's reported Sherrill's employment termination in September 2019, two months after the required notice period. Radiance filed a motion for judgment against Bondy's, arguing that Sherrill continued to provide services to Bondy's through his wife's company, KDS Aero Services, LLC. Bondy's responded with a motion to dismiss, claiming Sherrill was an independent contractor. The trial court granted Bondy's motion to dismiss and denied Radiance's motion.The Supreme Court of Alabama reviewed the case de novo. The court found that genuine issues of material fact existed regarding whether Bondy's payments to KDS Aero Services were actually owed to Sherrill. The lack of a contract or invoices between Bondy's and KDS Aero Services, coupled with inconsistencies in Sherrill's representations about his employment and residence, suggested potential fraud or misuse of corporate form to hide funds. The court reversed the trial court's judgment and remanded the case for further proceedings, emphasizing that neither party had met the burden for summary judgment. View "Radiance Capital Receivables Twelve, LLC v. Bondy's Ford, Inc." on Justia Law

This case involves a contractual dispute between Alabama Plating Technology, LLC (APT) and Georgia Plating Technology, LLC (GPT), DVEST, LLC, and Jin Kim. The dispute arose from an asset-purchase agreement for a brake-plating plant. After the purchase, APT claimed indemnity from the sellers for environmental issues, unpaid accounts payable, and certain inoperable assets, alleging these were retained liabilities or breaches of warranties by the sellers. The sellers sued APT for breach of contract due to setoff of losses against annual installment payments.The trial court found in favor of APT regarding the environmental issues and unpaid accounts payable, but sided with the sellers on the inoperable-assets claim. It also rejected APT's claim for attorneys' fees and legal expenses. Both parties appealed.The Supreme Court of Alabama reversed the trial court's judgment denying APT relief on its inoperable-assets claim and its claim for attorneys' fees and legal expenses. It affirmed the trial court's judgment granting APT relief on its environmental-issues and unpaid-accounts-payable claims, and the denial of the sellers' request to accelerate the remaining installment payments owed to them by APT. View "Alabama Plating Technology, LLC v. Georgia Plating Technology, LLC" on Justia Law

Joe Iskra and Rani Singh, the plaintiffs, entered into a contract to purchase a house from Kenneth Vinoski. Before closing, they hired a home inspection service that discovered a leak in the attic. The plaintiffs requested Vinoski to repair the leak before the sale, and Vinoski contracted Bear Roofing, LLC, the defendant, for the repair. The plaintiffs alleged that they were intended third-party beneficiaries of the contract between Vinoski and Bear, and that Bear breached the contract and an associated express warranty. They also claimed that Bear negligently performed the contracted repairs.The Jefferson Circuit Court entered a summary judgment in favor of Bear, ruling that the plaintiffs were not intended third-party beneficiaries of the contract between Vinoski and Bear. The court reasoned that the plaintiffs failed to provide substantial evidence that Bear intended to bestow a direct benefit to them at the moment the contract was formed. The court also noted that the contract did not mention or refer to the plaintiffs, and there was no evidence that Bear intended for anyone other than Vinoski to receive the benefit of its work performance.On appeal, the Supreme Court of Alabama reversed the trial court's decision and remanded the case for further proceedings. The Supreme Court found that the plaintiffs presented evidence showing a genuine issue of material fact regarding whether Bear intended to bestow a direct benefit upon them. The court also found that the plaintiffs presented evidence demonstrating a genuine issue of material fact regarding whether they were covered under Bear's warranty. Lastly, the court found that the plaintiffs presented evidence showing that they had relied to their detriment on Bear's performance in repairing the leak, and that Bear had known that it had been hired to repair a leak noted in an inspection report prepared in contemplation of the imminent sale of the house. Therefore, the trial court erred in entering a summary judgment in favor of Bear on the plaintiffs' negligence claim. View "Iskra v. Bear Roofing, LLC" on Justia Law

The case involves National Trust Insurance Company ("National Trust") and Whaley Construction Company, Inc. ("Whaley"). Whaley was a general contractor on a project at a Lockheed Martin facility. Smith's Inc. of Dothan ("Smith's of Dothan") was a subcontractor hired to install an HVAC system on the project, and Phoenix II Contracting, LLC ("Phoenix II"), was a subcontractor hired to install the roofing. Smith's of Dothan's subcontract with Whaley provided that Smith's of Dothan would name Whaley and Lockheed Martin as additional insureds on its liability policies. National Trust issued Smith's of Dothan a commercial-package policy and a commercial-liability umbrella policy ("the subject policies") through Harmon-DennisBradshaw, Inc. ("HDB"). Whaley and Lockheed Martin were additional insureds under the subject policies. Timothy L. Bozeman was working as a roof laborer on the Lockheed Martin project when he fell through an opening in the roof and was seriously injured. Bozeman sued Phoenix II and various fictitiously named defendants in the circuit court ("the state-court action").National Trust commenced a declaratory-judgment action in the Northern Division of the United States District Court for the Middle District of Alabama ("the federal-court action"). The complaint in the federal-court action named Smith's of Dothan, Whaley, Lockheed Martin, and the estate as respondents and included the following factual allegations: "25. A dispute has arisen as to whether Respondents Smith's [of Dothan], Whaley, and Lockheed [Martin] are entitled to a defense and indemnification as to the claims asserted in the Underlying Lawsuit. National Trust asserts that, based on the terms, conditions, and exclusions contained in the [subject] policies, Respondents Smith's [of Dothan], Whaley, and Lockheed [Martin] are not entitled to a defense in the underlying lawsuit or indemnification against settlement, award, or judgment therefrom.On April 14, 2023, Whaley filed a third-party complaint against National Trust and Continental Insurance Company ("Continental") in the state-court action. The third-party complaint alleged claims of breach of contract and bad-faith refusal to pay against National Trust and Continental. On May 4, 2023, National Trust filed a motion to dismiss in the state-court action. In the motion, National Trust asked the circuit court "to reconsider its previous Order … dated April 21, 2023, granting Whaley's motion for leave to file a third-party complaint against [National Trust] and further move[d] pursuant to Rule 12(b)(6) of the Alabama Rules of Civil Procedure to dismiss both of Whaley's claims asserted against [National Trust] in the Third-Party Complaint." In its motion, National Trust asserted that Whaley's claims against it were due to be dismissed "because they were compulsory counterclaims that Whaley was required to file in the federal[-court] action pursuant to § 65-440, Ala. Code 1975." On June 7, 2023, the circuit court entered an order denying National Trust's motion to dismiss the third-party complaint. National Trust subsequently filed a petition for a writ of mandamus asking this Court to direct the circuit court to enter an order dismissing National Trust from the state-court action.The Supreme Court of Alabama granted National Trust's mandamus petition in part and issued a writ directing the circuit court to enter an order dismissing Whaley's breach-of-contract and bad-faith claims in the state-court action that were based on National Trust's refusal to indemnify Whaley for the amount it had paid to settle Lockheed Martin's indemnity claim against it. However, the court denied the petition as to Whaley's contingent claims for a defense and indemnification. View "Ex parte National Trust Insurance Company" on Justia Law

This case involves a dispute among Players Recreation Group, LLC, an Alabama limited-liability company, three of its members, Jason L. McCarty, Felix McCarty, and Doyle Sadler, and S&M Associates, Inc., a company owned by Sadler. The LLC, established in 1999, owns and operates a bowling alley known as 'the Super Bowl.' In 2003, S&M, a company owned by Sadler, loaned the LLC $150,000, which is evidenced by a promissory note. In 2006, the Super Bowl began incurring substantial losses, and the LLC ultimately defaulted on the promissory note payable to S&M. In July 2015, S&M and Sadler sued the LLC and the other members of the LLC, asserting a breach-of-contract claim and a claim seeking an accounting. In August 2015, the LLC, Jason, and Felix filed an answer and a counterclaim, alleging that Sadler had breached his duty of loyalty and his duty of care to the LLC.The case proceeded to a bench trial. The parties initially stipulated that the LLC owed S&M a total of $310,139.66 on the promissory note; the trial court ultimately entered a judgment against the LLC for that amount based on the parties' stipulation. The case was then tried solely on the counterclaims asserted against Sadler by the LLC, Jason, and Felix. The trial court entered a judgment against Sadler on the counterclaims, based on its findings that Sadler had breached not only a duty of loyalty and a duty of care to the LLC, but also the implied covenant of good faith and fair dealing owed to the LLC. The trial court assessed damages against Sadler in the amount of $368,167.92.On appeal to the Supreme Court of Alabama, Sadler argued that the trial court erred insofar as it entered a judgment against him on the counterclaims asserted against him by the LLC, Jason, and Felix. The Supreme Court of Alabama agreed and reversed the judgment entered against Sadler on the counterclaims asserted against him because there was no evidence to support findings that Sadler had breached the duty of loyalty and the duty of care owed to the LLC or the implied covenant of good faith and fair dealing, and remanded the case to the trial court for the entry of a judgment consistent with this opinion.On remand, S&M and Sadler filed a motion for attorney's fees, costs, and expenses. The trial court denied the motions for attorney's fees, costs, and expenses. The trial court also found that the LLC had incurred $2,713,230.33 in expenses without contribution by Sadler or Scott Montgomery. That finding was not disturbed on appeal and has become the law of the case. The trial court took judicial notice that Jason and Felix McCarty have perfected, as the remaining members of the LLC, that claim or debt by filing a second mortgage with the Probate Court of Jefferson County, which second mortgage is inferior to the mortgage held by the late Ferris Ritchey’s real estate company, and the perfection of this claim makes it a priority over and superior to the claims of other creditors, including S&M.S&M and Sadler appealed the trial court's order on remand. The Supreme Court of Alabama affirmed the trial court's order on remand insofar as it denied S&M's and Sadler's requests for attorney's fees and costs, reversed the order insofar as it addressed the LLC's mortgage executed in favor of Jason and Felix and its purported priority, and remanded this case with instructions for the trial court to set aside that portion of its order that addressed the LLC's mortgage and its purported priority. View "S&M Associates, Inc. v. Players Recreation Group, LLC" on Justia Law

The case involves Alabama Relocation Services, Inc. ("ARS") and Patricia Buchannan, who filed a complaint against COWS USA, LLC ("COWS"), Trailpods Acceptance Corporation ("Trailpods"), Michael Frank, Ana Frank, and Leonard Rosenberg ("the COWS defendants"). ARS is a moving and storage company based in Mobile, Alabama, and Buchannan is its vice president. COWS is a Florida-based company that sells portable storage containers. ARS and Buchannan allege that they entered into a dealership agreement with COWS, which required them to lease equipment from Trailpods and finance the purchase of COWS equipment through Ascentium Capital, LLC ("Ascentium"). However, they claim that despite making payments, the promised equipment was never delivered.The COWS defendants filed a motion to dismiss the claims, arguing that the dealership agreement contained a forum-selection clause requiring disputes to be brought in Miami-Dade County, Florida. The Mobile Circuit Court denied their motion to dismiss. The COWS defendants then petitioned the Supreme Court of Alabama for a writ of mandamus, seeking an order directing the Mobile Circuit Court to vacate its order denying their motion to dismiss and to enter an order dismissing the claims.The Supreme Court of Alabama granted the petition. The court found that the dealership agreement's forum-selection clause clearly required actions between the parties to be brought in Miami, Florida. The court concluded that ARS and Buchannan failed to clearly establish that enforcement of the forum-selection clause would be unreasonable. The court directed the Mobile Circuit Court to vacate its order denying the COWS defendants' motions to dismiss and to enter a new order dismissing the claims against the COWS defendants, without prejudice. View "Ex parte Cows USA, LLC" on Justia Law