Justia Contracts Opinion Summaries

The case involves a monetary dispute between a mother (defendant) and her daughter (plaintiff). The daughter sued her mother and obtained a money judgment. During enforcement proceedings, the mother tendered the judgment amount, prejudgment interest, and interest accrued on a bank account in Shanghai. The dispute centers on whether the mother fully satisfied the judgment.The Superior Court of Los Angeles County found that the mother had tendered the full amount owed and granted her motion to require the daughter to acknowledge full satisfaction of the judgment. The daughter appealed, arguing there was no competent evidence to substantiate the interest amount accrued on the Shanghai bank account and that the court abused its discretion by not enforcing an order for a judgment debtor’s examination of the mother. She also complained about a comment by the trial court that she claimed offended due process.The Court of Appeal of the State of California, Second Appellate District, Division Eight, reviewed the case. The court found no merit in the daughter’s contentions. It held that there was sufficient evidence to conclude the interest was fully paid, noting that the trial court was entitled to consider the totality of the circumstances. The court also found no abuse of discretion in the trial court’s handling of the debtor examination and rejected the claim of judicial bias based on the court’s comment. The court affirmed the trial court’s order, concluding that the mother had satisfied the judgment and awarded her mandatory attorney fees. View "Merrick v. Lau" on Justia Law

A law firm, Kleinbard LLC, provided legal services to the Lancaster County District Attorney's Office, led by then-District Attorney Craig Stedman, to challenge the county commissioners over the use of certain forfeiture assets. Stedman and Kleinbard signed an engagement letter, agreeing that Kleinbard would be compensated for its services. The commissioners, however, refused to pay Kleinbard's invoices exceeding the $5,000 budgeted for legal services, arguing that the additional expenses were unauthorized.The Lancaster County Court of Common Pleas sustained preliminary objections from the defendants, allowing only the $5,000 payment and dismissing the remaining claims. The court ruled that the contract for legal services exceeding the budgeted amount was unenforceable under the County Code, which prohibits contracts that exceed appropriated sums without commissioners' approval.The Commonwealth Court affirmed the lower court's decision, agreeing that Stedman lacked authority to enter into a contract exceeding his budget without commissioners' approval. The court also expressed uncertainty about the nature of the Program Accounts, which Kleinbard claimed were controlled by the District Attorney and funded by program participants, not taxpayer money.The Supreme Court of Pennsylvania reviewed the case and found that the lower courts erred by not accepting as true the well-pleaded facts in Kleinbard's complaint at the preliminary objections stage. The Supreme Court held that the allegations, if true, established that the Program Accounts were not subject to the County Code's appropriation limits. Therefore, the court reversed the Commonwealth Court's decision and remanded the case for further proceedings to determine the nature and control of the Program Accounts. View "Kleinbard, LLC v. Lancaster Co. DA" on Justia Law

In 2014, due to severe drought conditions, the United States Bureau of Reclamation (Reclamation) was unable to meet its water delivery obligations to both the Exchange Contractors and the Friant Contractors under the Central Valley Project (CVP). Reclamation prioritized delivering water to the Exchange Contractors, including water from the San Joaquin River, which resulted in a near-zero allocation to the Friant Contractors. The Friant Contractors and individual growers sued the United States, alleging breach of contract and takings without just compensation.The United States Court of Federal Claims dismissed the Friant Growers' breach of contract claims for lack of standing and dismissed the takings claims for lack of a property interest. The court granted summary judgment to the government on the Friant Contractors' breach of contract claims, concluding that the Exchange Contractors' rights under the Exchange Contract were superior and that Reclamation's actions were not arbitrary, capricious, or unreasonable.The United States Court of Appeals for the Federal Circuit reviewed the case and affirmed the lower court's decision. The court held that the Exchange Contract allowed Reclamation to deliver San Joaquin River water to the Exchange Contractors when necessary, and that the government did not breach the Friant Contract by doing so. The court also found that the government was immune from liability under the Friant Contract because its actions were not arbitrary, capricious, or unreasonable. Finally, the court affirmed the dismissal of the takings claims, concluding that the Friant Contractors and Growers did not have a property interest in the water delivered by Reclamation under California law. View "CITY OF FRESNO v. US " on Justia Law

Majestic Asset Management, LLC, Wintech Development, Inc., Hai Huang, and Jen Huang owned and operated a golf course within a gated community governed by The Colony at California Oaks Homeowners Association. The owners had obligations to maintain the golf course and surrounding areas, secured by a performance deed of trust (PDOT). After failing to meet these obligations, the Association sought judicial enforcement, leading to a foreclosure decree and valuation of the PDOT.The Superior Court of Riverside County initially ruled in favor of the Association, finding the owners in breach of their maintenance obligations and issuing a permanent injunction. When the owners failed to comply, the court appointed a receiver to manage the golf course. After the receiver's efforts proved insufficient, the Association moved for foreclosure. The trial court valued the PDOT at $2,748,434.37, including the cost to repair the golf course and management fees, and ordered foreclosure.The California Court of Appeal, Fourth Appellate District, reviewed the case. The court affirmed the trial court's decision to use the cost of repair ($2,503,500) as the value of the PDOT but found the inclusion of management fees ($244,934.37) inappropriate. The court modified the foreclosure decree to reflect the correct value of $2,503,500. The court also upheld the ruling that the owners would remain bound by the maintenance obligations if they paid the PDOT's value to retain the property, ensuring the Association's right to performance as long as the owners held the golf course.The court concluded that the foreclosure decree was equitable and did not violate foreclosure law or the one form of action rule. The Association was awarded costs and reasonable attorney fees incurred on appeal. View "Majestic Asset Management, LLC v. The Colony at California Homeowners Assn." on Justia Law

The United States Department of the Navy issued a solicitation requesting technical support for its electromagnetic spectrum resources, requiring proposals to be submitted via email by a specified deadline. eSimplicity, Inc. submitted its proposal before the deadline, but it was not received by the Contracting Officer due to the email exceeding the maximum file size and being bounced back. The Navy deemed eSimplicity's proposal untimely and did not consider it.eSimplicity filed a pre-award bid protest with the United States Court of Federal Claims. The Claims Court ruled in favor of eSimplicity, concluding that the file size was an unstated evaluation criterion and that the government control exception could apply to electronically submitted proposals. The court remanded the case for the Navy to reconsider its decision or to take other actions consistent with the court's opinion. Subsequently, the Navy issued an amended solicitation and awarded the contract to eSimplicity.The United States Court of Appeals for the Federal Circuit reviewed the case. The court determined that the appeal was moot because the original solicitation had expired, and the contract had been awarded under a new solicitation. The court found that there was no longer a live controversy, as the issues presented on appeal concerned the now-expired solicitation. The court also rejected the government's argument that the case fell under the "capable of repetition yet evading review" exception to mootness, noting that the government had other opportunities to appeal similar issues in the past but chose not to do so. Consequently, the appeal was dismissed. View "ESIMPLICITY, INC. v. US " on Justia Law

The case involves a dispute between the municipality of Anchorage and the United States regarding two agreements related to the improvement of the Port of Alaska. In 2003, Anchorage and the United States, through the Maritime Administration (MARAD), signed a Memorandum of Understanding (2003 Memorandum) to upgrade and expand the port. In 2011, they signed a Memorandum of Agreement (2011 Memorandum) to address issues that arose during the project, including large-scale damage discovered in 2010.The United States Court of Federal Claims held that the United States breached the 2003 Memorandum by failing to deliver a defect-free port and the 2011 Memorandum by settling subcontractor claims without consulting Anchorage. The court awarded Anchorage $367,446,809 in damages, including $11,279,059 related to the settlement of subcontractor claims.The United States Court of Appeals for the Federal Circuit reviewed the case. The court found that the 2003 Memorandum did not require the United States to deliver a defect-free port, as it lacked specific terms such as what was to be built, where, dimensions, deadlines, and costs. The court vacated the Court of Federal Claims' decision regarding the 2003 Memorandum and remanded for further proceedings.However, the Federal Circuit affirmed the Court of Federal Claims' decision that the United States breached the 2011 Memorandum by settling subcontractor claims without conferring with Anchorage. The court upheld the award of $11,279,059 in damages to Anchorage for this breach. The case was vacated in part, affirmed in part, and remanded for further consideration consistent with the Federal Circuit's opinion. View "ANCHORAGE v. US " on Justia Law

Autumn Bertels was severely injured in a car accident involving her grandmother, Elizabeth Bertels, and another driver, Denver Barr, who both died in the crash. Autumn later filed a lawsuit against Elizabeth's estate, and they reached an agreement where the estate assigned its claims against Elizabeth's insurer, Farm Bureau Property & Casualty Insurance Company, to Autumn. The agreement stipulated that Autumn would not seek to collect from the estate's assets and would cover the estate's litigation expenses. A judge awarded Autumn a $15.75 million judgment against the estate, and she subsequently sued Farm Bureau for breach of contract and bad faith.The United States District Court for the District of Kansas dismissed Autumn's suit against Farm Bureau, ruling that she lacked standing because the assignment from the estate was invalid. The court determined that Autumn provided no consideration for the assignment, as her promises were already required by the Kansas nonclaim statute, which bars claims against a deceased person's estate after a certain period and requires the claimant to pay the estate's litigation expenses.The United States Court of Appeals for the Tenth Circuit reviewed the case and affirmed the district court's decision. The appellate court agreed that the nonclaim statute barred Autumn's claim against the estate's assets and required her to pay the estate's expenses, rendering her promises in the agreement illusory and without consideration. Consequently, the assignment was invalid, and Autumn lacked standing to sue Farm Bureau. The court also rejected Autumn's arguments regarding tolling of the nonclaim statute due to her minority and other constitutional claims, finding them unpersuasive or procedurally barred. View "Bertels v. Farm Bureau Property & Casualty Insurance Co." on Justia Law

A clothing retailer, Cato Corporation, with over 1,300 stores, purchased an "all-risk" commercial property insurance policy from Zurich American Insurance Company in July 2019. In the spring of 2020, Cato alleged that the COVID-19 virus and related government orders forced it to close or severely curtail operations, causing significant revenue losses and expenses for remediation and reconfiguration of its stores. Cato sought coverage for these losses under its insurance policy, but Zurich refused, leading Cato to file a lawsuit seeking a declaratory judgment and damages for breach of contract and violations of North Carolina's Unfair and Deceptive Trade Practices Act.The Superior Court of Mecklenburg County dismissed Cato's claims on a Rule 12(b)(6) motion, relying on the Court of Appeals' decision in North State Deli, LLC v. Cincinnati Insurance Co. The Court of Appeals affirmed the dismissal, concluding that tangible alteration to the property was necessary to recover for a "direct physical loss of or damage" to property, which Cato failed to allege sufficiently.The Supreme Court of North Carolina reviewed the case and agreed with the Court of Appeals' decision to affirm the dismissal but disagreed with its reasoning. The Supreme Court concluded that Cato sufficiently alleged a "direct physical loss of or damage" to property under the precedent set in North State Deli. However, the Court found that the viral contamination exclusion in Cato's policy precluded coverage for the alleged losses. Therefore, the Supreme Court modified the Court of Appeals' decision but affirmed its judgment dismissing Cato's claims. View "Cato Corp. v. Zurich American Insurance Co." on Justia Law

Chris Welsh, representing CAL SD, LLC, entered into a purchase agreement with Interwest Leasing, LLC to buy commercial real estate, with a $30,000 earnest money deposit. Welsh passed away before closing, and CAL SD refused to close. Interwest sold the property to another buyer for the same price but did not return the earnest money. CAL SD filed a declaratory judgment action to recover the deposit, claiming the agreement was void due to their inability to obtain financing.The Circuit Court of the Seventh Judicial Circuit in Pennington County, South Dakota, treated the declaratory judgment as a breach of contract action and set it for a jury trial. The jury found in favor of CAL SD, and the court ordered the return of the earnest money deposit. Interwest appealed, arguing the action was equitable and should not have been decided by a jury, and also claimed the court gave erroneous jury instructions.The Supreme Court of the State of South Dakota reviewed the case. The court held that the declaratory judgment action was legal, not equitable, because it sought to enforce contractual rights under the purchase agreement, which was void if financing was not obtained. The court affirmed the lower court's decision to submit the case to a jury for a binding verdict, as the issue was whether CAL SD breached the contract by failing to secure financing. The court concluded that the jury's determination that CAL SD was unable to obtain financing rendered the purchase agreement void, entitling CAL SD to the return of the earnest money deposit. View "Cal SD, LLC v. Interwest Leasing, LLC" on Justia Law

A customer, Davie Montes, purchased a used car from National Buick GMC (National) and signed two agreements: a Purchase Agreement and an Arbitration Agreement. The Purchase Agreement included an integration clause stating it was the complete and exclusive statement of terms. The Arbitration Agreement, which did not have an integration clause, covered disputes related to the purchase or financing of the vehicle. After experiencing issues with the car, Montes sued National, which then moved to compel arbitration based on the Arbitration Agreement.The Fourth District Court in Provo denied National's motion, ruling that the Purchase Agreement's integration clause made it the sole agreement between the parties. The Utah Court of Appeals affirmed this decision, interpreting Utah precedent to mean that the integration clause precluded consideration of the Arbitration Agreement.The Supreme Court of the State of Utah reviewed the case and reversed the lower courts' decisions. The Supreme Court held that contemporaneous, executed agreements related to the same transaction should be construed together, even if one contains an integration clause. The court found that the Purchase Agreement and the Arbitration Agreement were part of the same transaction and should be considered together. The case was remanded for further proceedings consistent with this opinion. View "Montes v. National Buick GMC" on Justia Law