Justia Contracts Opinion Summaries

Articles Posted in Vermont Supreme Court
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Defendant Adam Provost appealed a civil division determination that plaintiff Burlington School District could disclose, in response to a newspaper’s public records request, an unredacted copy of a Resignation Agreement reached by the District and Provost concerning his employment with the District. Provost argued the civil division: (1) lacked subject matter jurisdiction to consider the District’s request for declaratory relief regarding a matter within the exclusive purview of the Public Records Act (PRA); and (2) erred by granting the District’s request for declaratory relief based on its conclusion that Provost had waived any objection to release of the agreement, even assuming it had jurisdiction to consider the request. The Vermont Supreme Court determined the District and Provost entered into a contract acknowledging the obligation of the District, as a public entity subject to the PRA, to release the Resignation Agreement "under the provisions of applicable law." The District and Provost had reached a legal stalemate over whether release of an unredacted copy of the Agreement would violate not only the PRA, but also their Agreement, which would expose the District to a breach-of-contract claim. Under these circumstances, it was entirely appropriate for the superior court to exercise its general jurisdiction to adjudicate the District’s request for declaratory relief. Therefore, the Supreme Court affirmed the district court's judgment. View "Burlington School District v. Provost" on Justia Law

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Plaintiffs, Lofts Essex, LLC and the Wilson Inn, Inc. (collectively, the Lofts), appeal the trial court’s pretrial denial of summary judgment and the court’s final decision ruling in favor of defendant, Strategis Floor and Décor, Inc. The dispute between the parties arose from a warranty claim made on laminate flooring in a 54-apartment unit complex. The Vermont Supreme Court concluded that the trial court’s pretrial denial of summary judgment was not reviewable and affirmed the final decision granting judgment to Strategis. View "The Lofts Essex, LLC v. Strategis Floor Decor Inc." on Justia Law

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After a bench trial, a trial court issued a judgment and order which held, among other things, that Wright & Morrissey owed J & K Tile Co. $42,000 plus interest under a Memorandum of Understanding (MOU) between the parties, and that Wright & Morrissey unlawfully withheld J & K Tile Co.’s retainage check in violation of the Vermont Prompt Pay Act. Following this decision a few months later, the court further held that each party was the prevailing party in a portion of the litigation and should be awarded attorney’s fees regarding that portion. Wright & Morrissey appealed, and J & K Tile Co. cross-appealed. With regard to the retainage, the Vermont Supreme Court determined the trial court did not err. However, with respect to the prevailing party issue, the Supreme Court determined “a fee award should not be apportioned among claims that arise from a common core of facts.” Although not all of the evidence was relevant to all the claims, all the evidence, and all the theories of liability, related to the same common core of facts. J & K Tile Co. itself treated the claims as arising from a common core of facts, as evidenced by their combining the failure-to-mediate and breach-of-contract allegations into a single count. The Supreme Court concluded the trial court should have determined who was the substantially prevailing party as a whole, considering all the claims together. Accordingly, it reversed the order regarding attorney’s fees and remanded the matter to the trial court for further proceedings. View "J & K Tile Company" on Justia Law

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This case arose from a series of plans overseen by defendants to develop several real estate projects in the Northeast Kingdom of Vermont. Work on these projects spanned eight years, including fundraising and planning stages, and involved several limited partnerships and other corporate entities (the Jay Peak Projects). The Jay Peak Projects, at the direction of defendants Ariel Quiros and William Stenger, raised investment funds largely through a federal program known as the EB-5 Immigrant Investor Program (EB-5 Program). In April 2016, the U.S. Securities and Exchange Commission filed a lawsuit alleging securities fraud, wire fraud, and mail fraud against the Jay Peak Projects developers, Ariel Quiros and William Stenger. The Vermont Department of Financial Regulation also filed suit against Quiros and Stenger, alleging similar claims. On the basis of these and other allegations, plaintiffs, all foreign nationals who invested in the Jay Peak Projects, filed a multi-count claim against ACCD and several individual defendants. Intervenors, a group of foreign investors who were allegedly defrauded by defendants, appealed an order denying their motion to intervene in the State’s enforcement action brought against defendants. The Vermont Supreme Court affirmed because the motion to intervene was untimely. View "Vermont, et al. v. Quiros, et al." on Justia Law

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Plaintiff-investors appealed the dismissal of their claims against the Vermont Agency of Commerce and Community Development (ACCD) and current and former state employees arising from the operation of a federally licensed regional center in the United States Customs and Immigration Services (USCIS) EB-5 program. USCIS designated ACCD as a regional center in 1997, and ACCD began operating the Vermont Regional Center (VRC). In 2006, the VRC partnered with a series of projects led by Ariel Quiros and William Stenger (referred to as the “Jay Peak Projects”). ACCD entered into a memorandum of understanding (MOU) with the Jay Peak Projects for each project. Employees of ACCD, including James Candido and Brent Raymond, both former executive directors of the VRC, and John Kessler, general counsel for ACCD, traveled with Jay Peak representatives to EB-5 tradeshows, at which they would share a table and jointly solicit investors and promote the Projects. ACCD employees represented to prospective investors, including plaintiffs, that the added protections of state approval and oversight made the Jay Peak Projects a particularly sound investment. However, unbeknownst to the investors, but known to VRC officials, no such state oversight by the VRC existed. In 2014, about twenty investors, including plaintiff Antony Sutton, sent complaints to Brent Raymond alleging that the Jay Peak Projects was misappropriating investor funds. In April 2016, the U.S. Securities and Exchange Commission filed a lawsuit alleging securities fraud, wire fraud, and mail fraud against the Jay Peak Projects developers, Ariel Quiros and William Stenger. The Vermont Department of Financial Regulation also filed suit against Quiros and Stenger, alleging similar claims. On the basis of these and other allegations, plaintiffs, all foreign nationals who invested in the Jay Peak Projects, filed a multi-count claim against ACCD and several individual defendants. The trial court granted plaintiffs’ motion to amend their complaint for a third time to a Fourth Amended Complaint, and then dismissed all thirteen counts on various grounds. Plaintiffs appealed. The Vermont Supreme Court reversed dismissal of plaintiffs’ claims of negligence and negligent misrepresentation against ACCD, gross negligence against defendants Brent Raymond and James Candido, and breach of contract and the implied covenant of good faith and fair dealing against ACCD. The Court affirmed dismissal of plaintiffs’ remaining claims. View "Sutton, et al. v. Vermont Regional Center, et al." on Justia Law

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The trial court found that the parties to this landlord-tenant dispute had an oral rental agreement. Plaintiff-landlord was awarded plaintiff landlord back rent and reimbursement for electric bills. The court granted one tenant damages to compensate him for work he performed on landlord’s properties and another tenant compensatory and punitive damages for breach of the implied warranty of habitability and illegal eviction. Landlord appealed, arguing the trial court erred by: (1) finding there was an oral rental agreement between the parties and that defendants were tenants; (2) awarding rent for only a portion of the period tenants occupied the property; (3) awarding tenant Edson damages because the claim was not properly pled; and (4) awarding tenant Well punitive damages. Tenants cross appealed, arguing that the court abused its discretion in finding there was an agreement to pay rent once the building was compliant with the housing code and erred in awarding landlord back rent based on a theory of unjust enrichment. The Vermont Supreme Court concluded the evidence supported the trial court’s finding that the parties entered an oral agreement allowing tenants to stay in landlord’s apartment rent-free for some portion of time. The record did not support the court’s findings as to the terms of that agreement: that tenants agreed to pay rent after the building became compliant with the housing code and that the building did not become code-compliant until the third week of November 2016. Consequently, the award of back rent and reimbursement for electrical costs to landlord was stricken, and that issue remanded back to the trial court to make new findings regarding the nature of the parties’ agreement and to enter any revised judgment if supported by the facts. The Supreme Court affirmed the trial court’s award of damages to tenant Edson for the work he performed for landlord, concluding that the issue was tried by implied consent. Finally, the Supreme Court concluded an award of punitive damages was allowable as damages for breach of the warranty of habitability and affirmed the award of punitive damages to tenant Well. View "Kwon v. Edson" on Justia Law

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Appellants Icon Legacy Custom Modular Homes, LLC and Icon Legacy Transport, LLC challenged a series of trial court orders in favor of appellees Dagney Trevor, Merusi Builders, Inc., Osborne Construction, LLC, and Paul Osborne. This appeal arose from the sale and construction of a new modular home that suffered from significant deficiencies. Trevor purchased the modular home; Icon Legacy Custom Modular Homes, LLC (Icon Legacy) and Icon Legacy Transport, LLC (Icon Transport) manufactured and transported the home; Osborne Construction, LLC (Osborne Construction) and Paul Osborne (Osborne) were collectively the contractor involved in the assembly the home; Merusi Builders, Inc. (Merusi) was a subcontractor involved in the assembly of the home. Though not parties to this appeal, Vermont Modular Homes, Inc., David Curtis, and Blane Bovier were Icon’s Vermont-based “approved builders” and three of the defendants in the suit below. In 2015, Trevor purchased an Icon Legacy Custom Modular Home as a replacement to one she lost to fire. The home sustained significant water damage during a rainstorm when water entered the home before the roof installation was complete. Other structural defects emerged after Trevor moved into the home. Although Icon and Vermont Modular Homes repaired some of the damage, major defects relating to both the water damage and alleged improper construction remained in the home. Ultimately judgement was entered against Icon. Icon appealed, arguing multiple errors leading to the outcome against it. The Vermont Supreme Court reversed as to the trial court's thirty-percent upward adjustment of the lodestar damages calculation, and remanded for the trial court to strike that amount from Trevor's attorney fee award. The Court affirmed the trial court in all other respects. View "Trevor v. Icon Legacy Custom Modular Homes, LLC, et al." on Justia Law

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Integrated Technologies, Inc. (ITI) appealed the grant of summary judgment in favor of Crum & Forster Specialty Insurance Company (Crum). ITI alleged Crum breached its duty to defend ITI against a suit brought by the GOAD Company. The court granted summary judgment to Crum, finding no claim in the GOAD complaint that was potentially covered by the policy’s Errors & Omissions (E&O) Liability Coverage Part. ITI argued on appeal that the trial court misread the allegations in the GOAD complaint and interpreted the policy coverage too narrowly. Finding no reversible error, the Vermont Supreme Court affirmed. View "Integrated Technologies, Inc. v. Crum & Forster Specialty Insurance Company" on Justia Law

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laintiff was a car repair business in Rutland, Vermont. Defendant insured the vehicles of dozens of plaintiff’s customers (“the insureds”) who hired plaintiff to repair damage to their vehicles between 2009 and 2014. Over seventy insurance claims, which all arose under identical insurance policies, were combined in this breach-of- contract case. In each instance, defendant paid less than what plaintiff had billed to complete the repair, a "short pay." Plaintiff submitted to defendant a final invoice and a “supplemental report” itemizing each of the repairs performed. For each claim involved in this case, although defendant did not pay a portion of what the repair shop believed was owed under the policy, defendant did pay significant sums. Defendant initially paid what its claims adjuster believed to be covered by the insurance policy after having conducted a visual inspection of the damage. Defendant generally would make at least one additional payment based on information provided by plaintiff after plaintiff disassembled the damaged vehicle in preparation to repair it, a "supplemental payment." After an adjuster’s initial estimate was paid to plaintiff and any supplemental payments were made, there was still an outstanding balance for the repair bill on each claim involved in this case. Plaintiff believed these were covered by the insurance policy yet had been unpaid by the insurer. However, defendant maintained that these unpaid portions of the repair bill between plaintiff and each insured were not covered under the policy. A jury ultimately awarded plaintiff $41,737.89 in damages. After the trial, the court concluded that plaintiff could not show that his assignors were damaged by a breach of contract by defendant and granted defendant's motion for judgment as a matter of law. The Vermont Supreme Court reversed this determination, vacated the judgment that was entered in favor of defendant, and remanded with direction to the superior court to reinstate the jury’s verdict and its award of damages. View "Parker's Classic Auto Works, Ltd. v. Nationwide Mutual Insurance Company" on Justia Law

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Appellant Rainforest Chocolate, LLC appealed the grant of summary judgment motion in favor of appellee Sentinel Insurance Company, Ltd. Rainforest was insured under a business-owner policy offered by Sentinel. In May 2016, Rainforest’s employee received an email purporting to be from his manager. The email directed the employee to transfer $19,875 to a specified outside bank account through an electronic-funds transfer. Unbeknownst to the employee, an unknown individual had gained control of the manager’s email account and sent the email. The employee electronically transferred the money. Shortly thereafter when Rainforest learned that the manager had not sent the email, it contacted its bank, which froze its account and limited the loss to $10,261.36. Rainforest reported the loss to Sentinel. In a series of letters exchanged concerning coverage for the loss, Rainforest claimed the loss should be covered under provisions of the policy covering losses due to Forgery, for Forged or Altered Instruments, and for losses resulting from Computer Fraud. Sentinel denied coverage. In a continuing attempt to obtain coverage for the loss, Rainforest also claimed coverage under a provision of the policy for the loss of Money or Securities by theft. Sentinel again denied coverage, primarily relying on an exclusion for physical loss or physical damage caused by or resulting from False Pretense that concerned “voluntary parting” of the property—the False Pretense Exclusion. Finding certain terms in the policy at issue were ambiguous, the Vermont Supreme Court reversed summary judgment and remanded for the trial court to consider in the first instance whether other provisions in the policy could provide coverage for Rainforest's loss. View "Rainforest Chocolate, LLC v. Sentinel Insurance Company, Ltd." on Justia Law