Justia Contracts Opinion Summaries

Plaintiff Fraser Trebilcock Davis & Dunlap, P.C. provided legal services to the defendants, a group of trusts, in connection with the financing and purchase of four hydroelectric dams. Dissatisfied with the representation they received, defendants refused to pay the full sum of fees billed by Fraser Trebilcock. To recover these unpaid fees, Fraser Trebilcock brought the underlying suit against defendants for breach of contract. Pursuant to MCR 2.403, the matter was submitted for a case evaluation, which resulted in an evaluation of $60,000 in favor of Fraser Trebilcock. Fraser Trebilcock accepted the evaluation, but defendants rejected it. The case proceeded to trial, resulting in a verdict for Fraser Trebilcock and a judgment totaling $73,501.90. Throughout the litigation of this breach-of-contract action, Fraser Trebilcock appeared through Michael Perry (a shareholder of the firm) and other lawyers affiliated with the firm. At no point did Fraser Trebilcock retain outside counsel, and there was no indication that the firm entered into a retainer agreement with its member lawyers or received or paid a bill for their services in connection with the litigation. After receiving the verdict, the parties filed posttrial motions: defendants moved for a new trial, and Fraser Trebilcock moved for case-evaluation sanctions under MCR 2.403(O), seeking to recover, inter alia, a “reasonable attorney fee” under MCR 2.403(O)(6)(b) for the legal services performed by its member lawyers. The trial court denied the defendants’ motion for a new trial, and granted Fraser Trebilcock’s motion for case-evaluation sanctions, ruling in particular that Fraser Trebilcock could recover an attorney fee as part of its sanctions. The issue on appeal to the Supreme Court was whether the plaintiff law firm could recover, as case-evaluation sanctions under MCR 2.403(O)(6)(b), a “reasonable attorney fee” for the legal services performed by its own member lawyers in connection with its suit to recover unpaid fees from defendants. Contrary to the determinations of the trial court and the Court of Appeals majority, the Supreme Court concluded it could not. Accordingly, the Court of Appeals was reversed in part, the trial court's award of fees was vacated, and the case remanded for further proceedings. View "Frazier Trebilcock Davis & Dunlap, P.C. v. Boyce Trust 2350" on Justia Law

Durukan America, a Texas candy company, sued Rain Trading, an Illinois wholesaler, and its president, Canbulat, breach of contract and deceptive practices for allegedly refusing to pay for $86,000 in merchandise. To prove service, Durukan filed with the court two affidavits from a process server. After a month passed without an answer from the defendants, the district court entered a default judgment for Durukan. About a year later, after Canbulat was arrested for failing to respond to a citation to discover evidence, the defendants moved to vacate the default judgment, submitting an affidavit and records to show that they were never served. Canbulat provided corroboration that he was not at the location where service purportedly occurred. Without holding a hearing to address the dueling affidavits, the district court denied the motion. The Seventh Circuit vacated and remanded, holding that the district court should have held a hearing to resolve the factual conflict in the affidavits. View "Durukan Am., LLC v. Rain Trading, Inc." on Justia Law

Red River Trucking, LLC, appealed an amended judgment determining Peterbilt of Fargo, Inc., had a valid repairman's lien for completed repairs to a truck owned by Red River Trucking, Peterbilt breached a contract with Red River Trucking to repair the truck, and Red River Trucking was entitled to $390.66 in damages for Peterbilt's breach of the repair contract. After review of the parties' arguments on appeal, the Supreme Court concluded Red River Trucking's appeal from the amended judgment was timely and issues about damages for breach of the repair contract were not moot because of the subsequent sheriff's sale of the truck. The Court also concluded the district court did not clearly err in finding Red River Trucking failed to mitigate its damages and in awarding Red River Trucking $390.66 in damages for Peterbilt's breach of the repair contract. View "Peterbilt of Fargo, Inc. v. Red River Trucking, LLC" on Justia Law

LoRoad, based in Oregon, negotiated to have GXV, based in Missouri, build a custom expedition vehicle. While the parties were exchanging drafts of an Agreement, LoRoad wired GVX $120,000, but subsequently expressed several concerns and requested revisions. GVX promised a final set of documents “incorporating everything we’ve come to agreement on” “for final review and then signatures, so we can get this thing moving.” After several disagreements, LoRoad stated “We do want you guys to create this vehicle however we are no where near having the documents done . . . and while you have our commitment in the form of a $120k deposit, that in no way means that you have an agreement with us until the final documents are signed, sealed and delivered properly.” The relationship further deteriorated and, with the project underway, LoRoad filed suit to compel arbitration, invoking the arbitration provision in the Agreement. GXV denied a valid, enforceable agreement to arbitrate. The district court held that LoRoad failed to accept the Agreement signed by GXV so that it could not enforce the arbitration provision in that Agreement. The Eighth Circuit affirmed. View "LoRoad, LLC v. Global Expedition Vehicles LLC" on Justia Law

Ramsey applied for $2 million in life insurance from Penn. His application indicated that he was a Cleveland firefighter and had last seen his physician for a checkup in 2006. During a medical examination by a nurse, Ramsey disclosed that he suffered from chronic ulcerative colitis; in 1984 a colorectal surgeon had surgically removed Ramsey’s colon to alleviate his symptoms. After reviewing his medical records, in mid-April, Penn offered him a policy with one of the lowest ratings Penn offers and an above-average premium. On April 28, Ramsey was examined at the Cleveland Clinic. Having had no treatment for 10-12 years, his visit was precipitated by “frequent bloody [bowel movements] and feel[ing] bad.” On June 1, Penn drafted and Ramsey signed amendments, changing the policy value to $500,000. Ramsey stated: I have not had a colon[o]scopy since 2004 and have had no gastrointestinal problems since that time. Ramsey was soon diagnosed with stage IV metastatic rectal cancer and died in September 2011. Penn denied an application for benefits, rescinded the policy, and returned $14,761.45 in premiums. The district court granted Penn summary judgment, finding Ramsey had failed to inform Penn of a change in the status of his health before the delivery of his policy, breaching a representation in the contract. The Sixth Circuit reversed, finding a genuine dispute as to whether Ramsey misrepresented the state of his health by failing to disclose his rectal bleeding and doctor visits. View "Ramsey v. Penn Mut. Life Ins.Co." on Justia Law

Plaintiff, an attorney, filed a lawsuit against the Narragansett Indian Tribe alleging breach of contract. Plaintiff alleged that the Tribe contractually waived the sovereign immunity that would otherwise have prevented him from bringing this suit outside the tribal courts. The district court denied the Tribe’s motion to dismiss the case on sovereign immunity grounds. The Tribe did not appeal the denial of the motion to dismiss. Instead, the Tribe filed an untimely Fed. R. Civ. P. 59(e) motion for reconsideration. The district court denied the Rule 59(e) motion. The Tribe subsequently filed a notice purporting to appeal from both the denial of the motion to dismiss and the denial of the untimely Rule 59(e) motion. A prior duty panel of the First Circuit dismissed as untimely any appeal from the denial of the motion to dismiss. The First Circuit subsequently denied interlocutory review of the order denying its motion to reconsider, holding that it lacked jurisdiction to entertain such an appeal because the denial of the Tribe’s untimely 59(e) motion did not qualify as a collateral order that the Court may review prior to the end of the litigation in the district court. View "Luckerman v. Narragansett Indian Tribe" on Justia Law

Union Electric is a power company, and EIM is a trade-association-owned excess carrier for power companies. Union, as an association member, is a partial owner of EIM and is the named insured in a $100 million excess liability policy issued by EIM. Union and other power companies drafted the general form policy; Union negotiated the present policy with EIM. The policy requires that coverage disputes go through a mini-trial and arbitration. An exclusive forum-selection clause and a choice-of-law clause named New York. After failure of a Missouri reservoir caused extensive damage, Union paid to settle claims; EIM paid $68 million of the policy's $100 million limit. Union filed suit in Missouri seeking the remaining $32 million plus damages for breach of contract and vexatious refusal to pay. The district court dismissed, based on the forum-selection clause, The Eighth Circuit reversed and remanded for consideration of the relationship between the mini-trial requirement, the arbitration provision, and a public policy argument. On remand, the court denied the motion to dismiss, noting that arbitration agreements in insurance contracts are unenforceable under Missouri law and that contractual choice-of-law provisions have been held unenforceable if they would allow enforcement of such an agreement. The Supreme Court, in a different case, subsequently supported enforcement of contractual forum-selection clauses "[i]n all but the most unusual cases." Relying on that case, EIM moved for a transfer stating that it would not seek enforcement of the arbitration provision. The court held that the motion was not untimely and that the forum-selection clause was enforceable. The Eighth Circuit denied a writ of prohibition or mandamus to prevent the transfer, stating that Union did not establish entitlement to extraordinary relief. View "Union Elec. Co. v. Energy Mut. Ins. Ltd." on Justia Law

Plaintiffs filed suit against ISPC, alleging that ISPC violated the Truth in Lending Act (TILA), 15 U.S.C. 1635, 1637, by failing to disclose examples of minimum payments and the maximum repayment period, as well as failing to properly delay performance to allow plaintiffs to rescind the contract. The court concluded that ISPC did not take the requisite interest in plaintiffs’ primary residence to trigger the TILA protections on which plaintiffs rely. Accordingly, the court affirmed the district court's grant of summary judgment. View "Lankhorst v. Indep. Savings Plan Co." on Justia Law

Aggregate Construction, Inc., appealed the grant of summary judgment which declared certain leases of shop and office property to Aggregate were terminated on December 31, 2011, and dismissing Aggregate's counterclaims against Robin and Kathleen Funke. The Supreme Court concluded after review that the district court did not err in construing the leases to effectuate a termination on December 31, 2011, and in dismissing Aggregate's counterclaims. View "Funke v. Aggregate Construction, Inc." on Justia Law

This case stemmed from Ward Farms' purchase of Enerbase Cooperative Resource's tractor at a third-party auction sale. Michael Ward, a partner of Ward Farms, attended an auction sale, and bid on the tractor. Shortly after the sale, Ward Farms discovered the tractor required significant repairs. At Ward Farms' request, Enerbase inspected the tractor and estimated the repair costs as ranging from $19,550 to $31,430. Subsequently, Ward Farms sued Enerbase alleging fraud, misrepresentation, deceit, and breach of express and implied warranties. Ward Farms sought alternative remedies of rescission or damages. Ward Farms appealed the district court judgment denying its motion to amend its complaint and granting a summary judgment motion in favor of Enerbase. Upon review, the Supreme Court concluded the district court did not abuse its discretion in denying Ward Farms' motion to amend, and the district court did not err in granting Enerbase's summary judgment motion because Ward Farms did not raise an issue of material fact regarding its claim. View "Ward Farms v. Enerbase Cooperative Resource" on Justia Law