Justia Contracts Opinion Summaries

Plaintiff Earl Oldam raised chickens for O.K. Farms since 1995. In 2014, he and O.K. entered into the chicken-growing contract at issue in this case. The contract had a three-year duration, but O.K. retained the right to terminate the contract for certain specified reasons, including “[b]reach of any term or condition of this contract,” “[a]bandonment or neglect of a flock,” and “[f]ailure to care for or causing damage to [O.K.’s] equipment or property.” In 2016, Plaintiff discovered that one of his three chicken houses had flooded after an overnight rainstorm. Plaintiff contacted O.K. to inform them of the issue; some of the flock in the affected henhouse perished from the flood. Remaining chickens were collected by O.K. Plaintiff was paid for the work he had done in raising the surviving chickens to this point, reduced by various expenses such as the costs of catching and moving the chickens. Shortly thereafter, O.K. sent Plaintiff a letter providing him with a ninety-day notice of contract termination for breach of the terms of the contract. Plaintiff filed suit in state court, alleging that O.K. breached the contract by terminating the agreement without adequate cause. O.K. removed the action to federal court and filed a motion for summary judgment. The district court stated that it had looked at the undisputed material facts from the summary judgment pleadings and found “questions of fact galore” on all of the arguments raised by O.K. in its motion. “But,” the court continued, “all that doesn’t matter,” because Plaintiff “didn’t say come take away the chickens from the flooded henhouse. He said come take them all.” The court granted O.K.’s motion for summary judgment, reasoning that because there was “nothing in the evidentiary material showing [that the chickens in the other henhouses] were in danger at all, he abandoned them” by telling O.K. to come pick them all up. In reversing the district court’s judgment, the Tenth Circuit found plaintiff raised arguments that directly addressed the district court’s sua sponte reasoning and that he was not provided an opportunity to make at trial, and argued he was prejudiced by the district court’s entry of judgment on this basis without considering any of the contrary arguments he might have made given notice and a reasonable time to respond. The Court was persuaded that Plaintiff had shown prejudice from the trial court’s sua sponte summary judgment decision. View "Oldham v. O.K. Farms" on Justia Law

The contract at issue in this appeal was an Independent Contractor Agreement (the Contract) between the Ute Indian Tribe and Lynn Becker, a former manager in the Tribe’s Energy and Minerals Department. Becker claimed the Tribe breached the Contract by failing to pay him 2% of net revenue distributed to Ute Energy Holdings, LLC from Ute Energy, LLC. After Becker filed suit in Utah state court, the Tribe filed this suit against him and Judge Barry Lawrence, the state judge presiding over Becker’s suit, seeking declarations that: (1) the state court lacks subject-matter jurisdiction over the dispute; (2) the Contract was void under federal and tribal law; and (3) there was no valid waiver of the Tribe’s sovereign immunity for the claims asserted in state court. The Tribe also sought a preliminary injunction ordering defendants to refrain from further action in the state court proceedings. The federal district court held that it lacked jurisdiction to consider the Tribe’s challenge to the jurisdiction of the state court. The Tenth Circuit disagreed with the district court, and reversed and remanded for further proceedings. The Court held that the Tribe’s claim that federal law precluded state-court jurisdiction over a claim against Indians arising on the reservation presented a federal question that sustained federal jurisdiction. View "Ute Indian Tribe of the Uintah v. Lawrence" on Justia Law

The Ute Indian Tribe of the Uintah and Ouray Reservation appealed a preliminary injunction ordering it not to proceed with litigation in tribal court against a nonmember former contractor, Lynn Becker. The district court ruled that although the parties’ dispute would ordinarily come within the tribal court’s jurisdiction, their Independent Contractor Agreement (the Contract) waived the Tribe’s right to litigate in that forum. The Tribe argued: (1) the tribal-exhaustion rule, which ordinarily requires a federal court to abstain from determining the jurisdiction of a tribal court until the tribal court has ruled on its own jurisdiction, deprived the district court of jurisdiction to determine the tribal court’s jurisdiction; and (2) even if exhaustion was not required, the preliminary injunction was improper because the Contract did not waive the Tribe’s right to litigate this dispute in tribal court. In addition, the Tribe challenged the district court’s dismissal of its claims under the federal civil-rights act, 42 U.S.C. 1983, seeking to halt state-court litigation between it and Becker. The Tenth Circuit did not agree the tribal-exhaustion rule was jurisdictional, but agreed the district court should have abstained on the issue. Although the Contract contained a waiver of the tribal-exhaustion rule, Becker could not show a likelihood of success based on the validity of the waiver; he failed to adequately counter the Tribe’s contention that the entire Contract, including the waiver, was void because it did not receive federal-government approval, as was required for contracts transferring property held in trust for the Tribe by the federal government. With respect to the Tribe’s claim under 42 U.S.C. 1983, the Tenth Circuit found the Tribe has not stated a claim because it is not a “person” entitled to relief under that statute when it is seeking, as here, to vindicate only a sovereign interest. To resolve the remaining issues raised in this case, the Court adopted its decision in the companion case of Ute Indian Tribe v. Lawrence, No. 16-4154 (August 25, 2017). View "Becker v. Ute Indian Tribe" on Justia Law