Justia Contracts Opinion SummariesArticles Posted in Supreme Court of Indiana
Care Group Heart Hospital, LLC v. Sawyer
The hospital that paid out a doctor’s ownership interest after his employment as a cardiologist terminated did not breach its agreement with the doctor. Dr. Roderick Sawyer worked as a cardiologist for St. Vincent Medical Group, Inc. (the Medical Group) and was a member-owner of The Care Group Heart Hospital, LLC (the Hospital). Sawyer agreed with the Medical Group and the Hospital that upon “any termination” of employment between him and the Medical Group, his ownership interest in the Hospital must be discontinued and redeemed. After the Medical Group terminated Sawyer’s employment, the Hospital paid out Sawyer’s ownership interest. Sawyer sued the Hospital, among others, alleging breach of contract. The jury returned a verdict against the Hospital for breach of contract. The Supreme Court reversed, holding (1) under the plain meaning of the contract language, the Hospital did not breach the agreement by discontinuing and redeeming Sawyer’s ownership interest; but (2) the Hospital did breach the agreement by delaying the payout, so Sawyer was entitled to interest on the delay. View "Care Group Heart Hospital, LLC v. Sawyer" on Justia Law
Kennedy Tank & Manufacturing Co. v. Emmert Industrial Corp.
Kennedy Tank & Manufacturing Company contracted with Emmert Industrial Corporation to transport an enormous process tower vessel to Indiana to Tennessee. Despite several troubles resulting in unforeseen costs, Emmert successfully delivered the vehicle. When Kennedy refused to pay any additional charges, Emmert sued, alleging breach of contract and, in the alternative, unjust enrichment. Kennedy moved to dismiss Emmert’s complaint, arguing that the federal statute of limitations preempts Indiana’s longer limitations period. The trial court denied the motion to dismiss, finding no preemption. The Supreme Court affirmed, holding that Indiana’s statute of limitations is not preempted by the federal statute of limitations. View "Kennedy Tank & Manufacturing Co. v. Emmert Industrial Corp." on Justia Law
State v. Int’l Bus. Machines Corp.
The State and International Business Machines, Corp. (IBM) entered into a ten-year, $1.3 billion Master Services Agreement (MSA) to modernize and improve Indiana’s welfare eligibility system. The State terminated the MSA in less than three years, stating that performance issues on the part of IBM constituted a material breach of the MSA. Both parties sued each other for breach of contract. The trial court determined that the State failed to prove that IBM materially breached the MSA. The Supreme Court reversed the trial court’s finding that IBM did not materially breach the MSA, holding that, under the circumstances of this case, IBM’s collective breaches were material in light of the MSA as a whole. View "State v. Int’l Bus. Machines Corp." on Justia Law
Mid-America Sound Corp. v. Ind. State Fair Comm’n
The Indiana State Fair Commission manages the Indiana State Fair. Since the 1990s, the Commission has utilized Mid-America Sound to provide equipment for the concerts and other events that take place at the Fair. In August 2011, on the closing night of the Fair, the Mid-America’s roof collapsed, killing seven people. The victims and families filed lawsuits, including as defendants Mid-America and the Commission. Mid-America filed a third-party lawsuit claiming that the Commission was required to indemnify it for Mid-America’s own negligence in relation to the roof collapse due to years-long course of conduct in paying invoices that had standard indemnity language on the back. The trial court granted summary judgment for the Commission. The Supreme Court affirmed, holding that because the terms of Mid-America’s invoices to the Commission did not clearly and unequivocally provide for retroactive application, the Court will not infer such a provision from a course of dealing. View "Mid-America Sound Corp. v. Ind. State Fair Comm’n" on Justia Law
AM General LLC v. Armour
James Armour’s employment contract with AM General LLC entitled him to payment of a long-term incentive plan (LTIP). When Armour retired, he was to receive a lump sum LTIP payment, but instead he started receiving quarterly installment payments in the form of checks. AM General attempted to make the final installment payment with a subordinate promissory note. Armour rejected the Note and requested full payment. Thereafter, AM General filed a complaint seeking a declaratory judgment that it had not breached the LTIP portion of its agreement with Armour. Armour counterclaimed, asserting that AM General breached the employment agreement by failing to pay Armour the full LTIP payment when it was due and claiming that, by attempting to pay the remaining portion of the LTIP payment with a promissory note, AM General breached the duty of good faith and fair dealing. The trial court entered summary judgment in favor of Armour. The Court of Appeals reversed, finding a genuine issue of material fact with regard to how “payment” could be made under the LTIP provision of the agreement. The Supreme Court granted transfer and affirmed the grant of summary judgment, holding that AM General breached its employment agreement with Armour because the Note did not constitute payment under the employment agreement. View "AM General LLC v. Armour" on Justia Law