Justia Contracts Opinion Summaries

In 2007, the legislature passed, and the voters ratified, the Insurance Fair Conduct Act (IFCA), RCW 48.30.015. IFCA gave insureds a new cause of action against insurers who unreasonably deny coverage or benefits. IFCA also directed courts to grant attorney fees and authorizes courts to award triple damages if the insurer either acts unreasonably or violates certain insurance regulations. The issue this case presented for the Supreme Court's review was whether IFCA also created a new and independent private cause of action for violation of these regulations in the absence of any unreasonable denial of coverage or benefits. The Court concluded it did not and affirmed. View "Perez-Crisantos v. State Farm Fire & Cas. Co." on Justia Law

Love Field airport is owned by the City and leased in part to Southwest Airlines. The City sought a declaration determining whether it must order Southwest to accommodate Delta at Love Field under the Lease Agreement or otherwise. Delta, Southwest, and the City filed competing motions for preliminary injunctions. The district court denied Southwest's motion and entered a preliminary injunction in favor of Delta essentially permitting Delta to continue operating five flights daily until a final decision on the merits. On appeal, Southwest argues that Delta is not a third party beneficiary and that the Lease Agreement does not require the accommodation Delta seeks. The court agreed with the district court that Delta and the City have shown a substantial likelihood of success on the merits on the claim that the Lease Agreement requires Delta to be accommodated. In this case, the Lease Agreement plainly establishes a duty to accommodate by both Southwest and the City, and the scope of that duty is determined largely through the interpretation of language which the Lease Agreement itself leaves undefined. Interpreting such language, the district court found - and the court found persuasive - that Southwest owed the duty to accommodate Delta under these circumstances. Accordingly, the court vacated the district court's order terminating the City's motion as moot; rendered judgment granting the City's motion for a preliminary injunction and ordering the accommodation of Delta; and affirmed the district court's denial of a preliminary injunction for Southwest. View "City of Dallas v. Delta Air Lines" on Justia Law

Western filed suit against La Cumbre for breach of an indemnity agreement where Mark J. Melchiori signed the agreement on La Cumbre's behalf as a managing member. In actuality, he was the managing member of La Cumbre's manager, MIC. MIC did not have actual authority to execute the indemnity agreement on La Cumbre's behalf. The trial court granted summary judgment for Western. The court concluded that Melchiori's signature binds La Cumbre pursuant to former Corporations Code section 17157, subdivision (d) (now section 17703.01, subdivision (d)), provided that the other party to the agreement does not have actual knowledge of the person's lack of authority to execute the agreement on behalf of La Cumbre. Accordingly, the court affirmed the judgment. View "Western Surety Co. v. La Cumbre Office Partners" on Justia Law

In 2011, plaintiff discovered a leak under her kitchen sink, which had caused extensive damage to her home, and filed a claim with her insurer, Farmers Insurance Company of Oregon (Farmers). In early 2012, Farmers voluntarily paid plaintiff a sum that it determined constituted the actual cash value of plaintiff’s losses less a deductible, $3,300.45. At around that time, it also paid plaintiff $2,169.22 in mitigation expenses. A few weeks later, plaintiff submitted to Farmers a proof of loss that included estimates of her mitigation costs and the actual cash value of her losses that far exceeded the sum that Farmers had paid her. Because plaintiff had not yet replaced any of the damaged items, she did not, at that time, submit a proof of loss that included the replacement cost of her losses. A year later, the parties had not resolved plaintiff’s claim, and in January 2013, plaintiff initiated this action. ORS 742.061 required an insurer to pay its insured’s attorney fees if, in the insured’s action against the insurer, the insured obtains a “recovery” that exceeds the amount of any tender made by the insurer within six months from the date that the insured first filed proof of a loss. In this case, the Supreme Court found that, when an insured files an action against an insurer to recover sums owing on an insurance policy and the insurer subsequently pays the insured more than the amount of any tender made within six months from the insured’s proof of loss, the insured obtains a “recovery” that entitles the insured to an award of reasonable attorney fees. View "Long v. Farmers Ins. Co." on Justia Law

David Knigge entered into an oral employment contract with Robert Knigge, who had cancer and a limited time to live, to manage a grocery store that was owned by Robert and his wife, Lynette. David alleged that the contract included a severance payment if Lynette ended David’s employment after Robert’s death. Robert died five months after entering into the contract. Lynette terminated David’s employment two months after Robert died and refused to pay the severance. David filed suit to enforce the agreement. The circuit court granted summary judgment in favor of Lynnette, ruling that the oral contract was unenforceable under the statute of frauds because it could not be performed within one year. The Supreme Court reversed, holding that the circuit court erred in ruling that the contract was unenforceable under the statute of frauds and that there were disputes of material fact regarding the existence of the severance term. View "Knigge v. B & L Food Stores, Inc." on Justia Law

Plaintiff Givaudan Fragrances Corporation (Fragrances) faced liability as a result of environmental contamination from a manufacturing site that a related corporate entity operated in a facility in Clifton. The issue this case presented for review involved Fragrances' effort to obtain insurance coverage for environmental claims brought by governmental entities in response to discharges of hazardous substances that occurred during the pertinent policy periods running through January 1, 1986. Fragrances claimed that the defendant insurance companies (defendants) wrote liability policies for Givaudan Corporation during those relevant years. Fragrances argued that it was entitled, either as an affiliate of Givaudan Corporation or by operation of an assignment of rights, to have the insurers provide it with coverage for that environmental liability. Defendants claimed that they insured Givaudan Corporation as their named insured, not Fragrances, and that any assignment to Fragrances was invalid because defendants did not consent to the assignment, as was required for a valid assignment according to the language of the insurance policies. Therefore, collectively, defendants refused to honor Fragrances' right to bring insurance contract claims against them. Fragrances filed its complaint in February 2009 seeking a declaratory judgment that it was entitled to coverage under the policies. In February 2010, while the declaratory judgment action was pending, Fragrances notified defendants that Givaudan Roure Flavors Corporation (corporate successor-in-interest to Givaudan Corporation) planned to assign its post-loss rights under the insurance policies to Fragrances. Defendants refused to consent to the assignment. Nevertheless, Flavors executed the assignment to Fragrances. Both sides moved for summary judgment. Because Fragrances was not acquired by Givaudan Corporation during the policy period, the trial court determined that it could not be an affiliated corporation covered under the policies. The court also determined that the assignment in this case was an assignment of policies, which could not be assigned. The court denied Fragrances' motion and granted defendants' cross-motion for summary judgment. The Appellate Division reversed and remanded, explaining that although the anti-assignment clauses in the occurrence policies at issue would prevent an insured from transferring a policy without the consent of the insurer, once a loss occurs, an insured s claim under a policy may be assigned without the insurer s consent.The Supreme Court affirmed, concluding that, once an insured loss has occurred, an anti-assignment clause in an occurrence policy may not provide a basis for an insurer s declination of coverage based on the insured's assignment of the right to invoke policy coverage for that loss. The assignment at issue in this case was a post-loss claim assignment and therefore the rule voiding application of anti-assignment clauses to such assignments applied. View "Givaudan Fragrances Corp. v. Aetna Casualty & Surety Co." on Justia Law

Plaintiff filed suit against Defendants resulting from the failure of material Defendants had supplied to Plaintiff. Specifically, Plaintiff alleged breach of contract, breach of implied and express warranties, and negligence. The jury returned a verdict against Defendants and awarded more than $7 million in damages to Plaintiff. The First Circuit affirmed, holding that the district court did not err by (1) denying Defendants’ motion to exclude Plaintiff’s damages expert; (2) allowing Plaintiff’s employees to testify concerning potential customers’ intent to purchase Plaintiff’s new product; and (3) denying Defendants’ motion for judgment as a matter of law, a new trial, or to alter or amend the judgment. View "Packgen v. Berry Plastics Corp." on Justia Law

Centaurus and Grand View filed suit against Helix in Texas state court, alleging breach of contracts and requesting a declaratory judgment to determine rights under the Mutual Confidentiality Agreement (MCA). Helix then filed suit against Grand View and Centaurus in California federal court and removed the Texas suit to the federal court a quo. The district court granted Centaurus and Grand View's motion to remand to state court. The court affirmed, agreeing with the district court that it did not have jurisdiction because defendants had granted sole and exclusive jurisdiction to the state courts in the Forum Selection Clause of the MCA. View "Grand View PV Solar Two v. Helix Electric" on Justia Law

Plaintiffs borrowed $110 million in 2007 from Bear Stearns to finance the purchase of Rincon Towers, a San Francisco apartment complex. In 2010, after plaintiffs failed to repay the loan and after changes in the ownership of the loan, CP III purchased the property at a nonjudicial foreclosure sale. Plaintiffs sued CP III and other entities who were involved in administering the loan, unsuccessful workout negotiations, and the eventual foreclosure sale. The trial court rejected all of their claims. The court of appeal remanded plaintiffs’ legal claims (breach of contract, fraud, slander of title, trade secret misappropriation), finding that the trial court erred in striking their demand for a jury trial, but affirmed as to the equitable claims (unfair competition, to set aside the foreclosure sale, and for an accounting). View "Rincon EV Realty, LLC v. CP III Rincon Towers, Inc." on Justia Law

In 1997, Aaron sustained a catastrophic brain injury at birth due to the negligence of employees at Lee Memorial. The family retained the law firm, under a contingency fee agreement providing for payment of 40 percent of any recovery if a lawsuit was filed, plus costs, and stating that if "one of the parties to pay my claim for damages is a governmental agency, I understand that Federal and Florida Law may limit the amount of attorney fees ... in that event, I understand that the fees owed ... shall be the amount provided by law.” A jury awarded the child $28.3 million, the mother $1.34 million, and the father $1 million. Because the hospital was an independent special district of the state, the court enforced the sovereign immunity damage limitations and entered a judgment for $200,000, which was affirmed. The firm pursued a two-year lobbying effort to secure a claims bill from the Legislature. In 2012 the Legislature passed a claims bill, directing Lee Memorial to pay $10 million, with an additional $5 million to be paid in annual installments to a special needs trust for Aaron, stating that payment of fees and costs from those funds shall not exceed $100,000. No funds were awarded for the parents. The firm petitioned the guardianship court to approve a $2.5 million for attorneys’ fees and costs. The court denied the request. On appeal, the district court affirmed. The Supreme Court of Florida reversed, holding that the fee limitation in the claims bill is unconstitutional and may not stand when such a limitation impairs a preexisting contract. View "Searcy, Denney, Scarola, Barnhart & Shipley. v. Florida" on Justia Law