Justia Contracts Opinion Summaries

The Developer converted a vacant building into a residential condominium by gutting and refitting it. The Developer purchased Commercial Lines Policies covering bodily injury and property damage from Nautilus, covering periods from June 1998 through June 2000. The policies define occurrence as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions,” but do not define accident. The policies exclude damage to “that particular part of real property on which you or any contractors or subcontractors working directly or indirectly on your behalf are performing operations, if the ‘property damage’ arises out of those operations;” eliminate coverage for damage to “that particular part of any property that must be restored, repaired or replaced because ‘your work’ was incorrectly performed on it;” and contain an endorsement entitled “Exclusion—Products-Completed Operations Hazard.’ Construction was completed in 2000; the Developer transferred control to a board of owners. By May 2000, one homeowner was aware of water damage. In 2005, the Board hired a consulting firm, which found that the exterior brick walls were not fully waterproofed and concluded that the deterioration had likely developed over many years, even prior to the condominium conversion, but that the present water penetration was the result of inadequate restoration of the walls. The Board sued the Developer. Nautilus denied coverage and obtained a declaratory judgment. The Seventh Circuit affirmed, reviewing the policy and finding that the shoddy workmanship, of which the board complained, was not covered by the policies; that Nautilus did not unduly delay pursuing its declaratory suit; and that the alleged damage to residents’ personal property occurred after the portions of the building were excluded from coverage.View "Nautilus Ins. Co. v. Bd. of Dirs. of Regal Lofts Condo Ass'n" on Justia Law

Plaintiff filed suit against Defendants alleging fraud, defamation, abuse of process, breach of fiduciary duty, and other claims. Plaintiff also requested declaratory judgment, accounting, and injunctive relief. Pursuant to the parties’ prior agreement, which included an arbitration clause, the trial court granted Defendants’ motion to compel arbitration on all counts with the exception of claims involving defamation and abuse of process. Because Defendants appealed, the trial court refrained from ruling on Plaintiff’s request for injunctive relief. Consequently, Plaintiff petitioned the court of appeals, without success, for a writ of mandamus. The Supreme Court affirmed. Plaintiff also appealed the trial court’s order compelling arbitration. Plaintiff’s and Defendants’ appeals were consolidated. The court of appeals affirmed the entirety of the trial court’s order compelling arbitration. The Supreme Court affirmed in part and reversed in part, holding (1) the Court lacked jurisdiction to consider the merits of Plaintiff’s appeal because Plaintiff attempted to appeal from a non-final order; and (2) the court of appeals correctly determined that the abuse of process and defamation claims fell outside the agreement to arbitrate.View "Linden v. Griffin" on Justia Law

Appellants, former employees of the University of Kentucky, filed suit against the University alleging that, by rejecting their applications for disability status, the University breached a written contract consisting of a staff handbook and associated personnel policy documents defining the disability compensation programs. The court of appeals dismissed Appellants’ claims on the basis of governmental immunity, concluding that the documents establishing the University’s employee disability compensation did not constitute a written contract, and therefore, the University was shielded from Appellants’ claims by the doctrine of governmental immunity. The Supreme Court affirmed, holding (1) Appellants did not establish that the General Assembly expressly waived sovereign immunity in claims based upon implied contracts arising from a state university’s employee handbooks and personnel policies, and the relevant University personnel documents specifically disclaimed the creation of a contract; and (2) therefore, sovereign immunity remained a valid affirmative defense under the circumstances presented.View "Furtula v. Univ. of Ky." on Justia Law

Plaintiff leased property from Defendants pursuant to a lease agreement that included an arbitration clause. Plaintiffs later sued Defendants over disputes regarding the lease. After engaging in litigation with Plaintiff for more than two years, Defendants filed a motion to stay the proceedings pending arbitration under the parties’ lease agreement. Plaintiff objected to the motion, arguing that Defendants had waived their right to enforce the arbitration clause by engaging in lengthy litigation. The trial court granted Defendants’ motion, concluding, as a matter of law, that a party cannot waive enforcement of an arbitration clause in a contract. The Appellate Court affirmed, concluding that the record was inadequate for review because the trial court failed to make any factual findings on the issue of waiver. The Supreme Court reversed, holding (1) because the legal basis of the trial court’s decision was at issue, a factual record on the question of waiver was not necessary to review the trial court’s decision; and (2) the trial court based its judgment on an incorrect statement of the law, and therefore, the court erred in granting Defendants’ motion for a stay pending arbitration. View "MSO, LLC v. DeSimone" on Justia Law

From 2005 to 2010, Plaintiff, a Maine resident, worked as a salesman for Alpha Networks, which was based in California, pursuant to a written employment agreement. Plaintiff left Alpha having received no commissions on his sales in 2009 or 2010. Plaintiff then filed suit. A jury concluded that Alpha had not promised to pay Plaintiff commissions after 2008 but concluded that Plaintiff was entitled to damages in the amount of $70,331 under quasi-contract. After trial, the parties disputed whether California or Maine law governed whether and to what extent the jury’s damages award should be augmented with additional remedies. Under California law, Plaintiff would be entitled to an additional award of $7,799, but under Maine law, Plaintiff would be entitled to an additional $140,663, as well as attorneys’ fees and costs. The district court concluded that California law applied. The First Circuit vacated the award and remanded, holding that Maine substantive law governed enforcement of the quasi-contractual relationship found to exist between the parties in 2009 and 2010.View "Dinan v. Alpha Networks, Inc." on Justia Law

Police officers discovered Thomas Locke, a US Airways mechanic at Logan International Airport, filching company property. US Airways entered into a “Last Chance Agreement” with Locke in lieu of termination and provided for Locke’s return to work. Logan International Airport, however, denied Locke’s application for renewal of his security badge. Thereafter, US Airways concluded that Locke had violated the terms of the Agreement and terminated his employment. Locke subsequently filed suit against US Airways, alleging that US Airways breached the Agreement by interfering with his application for a security badge at Logan Airport and by preventing him from transferring to Philadelphia International Airport. The district court granted summary judgment for US Airways. The First Circuit affirmed, holding that there was no triable basis for Locke’s contentions in the record. View "Locke v. US Airways, Inc." on Justia Law

In 2008, Plaintiff purchased a home in Bar Harbor, Maine from Defendants for $2.9 million. After his purchase, Plaintiff spent in excess of $1.5 million in repairs to the property. Plaintiff brought suit against Defendant to recover damages for the repairs, alleging, among other claims, breach of contract, fraud, and negligent misrepresentation. A federal district court entered summary judgment in favor of Defendants, concluding (1) Maine’s implied warranty of habitability did not apply under the circumstances of this case, and Defendants had no duty of disclosure; and (2) Defendants were not entitled to attorney’s fees. The First Circuit affirmed, holding that the district court (1) properly granted summary judgment for Defendants on Plaintiff’s breach of contract, fraud, and negligent misrepresentation claims; and (2) properly entered judgment on the record for Plaintiff on Defendants’ counterclaim for attorney’s fees. View "Thompson v. Miles" on Justia Law

This action stems from a dispute between plaintiff James Robert Malloy and Swain R. Thompson, regarding assets of Robert L. Chamblee (Decedent). The complaint alleged that Thompson, with the assistance of Merrill Lynch, Pierce, Fenner & Smith, Inc., acted to disrupt Decedent's estate plan and divert Decedent's assets from Malloy to Thompson. Malloy characterized his claims against Merrill Lynch as: (1) intentional interference with inheritance; (2) aiding and abetting intentional interference with inheritance; (3) and civil conspiracy. Merrill Lynch moved to dismiss and compel arbitration arguing that its only connection to this dispute was through its contractual duties under the client relationship agreements (CRAs) entered into between Decedent and Merrill Lynch, which contained mandatory arbitration clauses. Merrill Lynch argued that although Malloy was a non-signatory to the agreements, any duty, if any, owed by Merrill Lynch to Malloy derives from the CRAs, and therefore, he is bound by the arbitration clauses. The circuit court denied the motion and found that while non-signatories may be bound to an arbitration agreement under common law principles of contract and agency law, none of those principles applied in this case, and therefore, there was no basis to compel Malloy to arbitrate. Merrill Lynch appealed. The Supreme Court affirmed the circuit court's denial of Merrill Lynch's motion to dismiss and compel arbitration. Finding no reversible error, the Supreme Court affirmed the circuit court's decision. View "Malloy v. Thompson" on Justia Law

Delores Williams, the personal representative of the Estate of Edward Murry, and Matthew Whitaker, Jr., the personal representative of the Estate of Annie Mae Murry (PRs), brought a declaratory judgment action to determine whether a GEICO motor vehicle insurance policy issued to the Murrys provided $15,000 or $100,000 in liability proceeds for bodily injury for an accident in which both of the Murrys were killed. The circuit court concluded coverage was limited to the statutory minimum of $15,000 based on a family step-down provision in the policy that reduced coverage for bodily injury to family members from the stated policy coverage of $100,000 to the statutory minimum amount mandated by South Carolina law during the policy period. The PRs appealed, contending the step-down provision was ambiguous and/or violative of public policy. The Supreme Court affirmed in part and reversed in part. The Court agreed with the circuit court that GEICO's policy is not ambiguous, but concluded the family step-down provision, which reduced the coverage under the liability policy from the stated policy amount to the statutory minimum, was violative of public policy and was, therefore, void. "The provision not only conflicte[d] with the mandates set forth in section 38-77-142, but its enforcement would be injurious to the public welfare." View "Williams v. GEICO" on Justia Law

The respondents, two developers and an architectural firm, Stevens & Wilkinson of South Carolina, Inc. (S&W), entered into a Memorandum of Understanding (MOU) with the City of Columbia as part of a larger project team to develop a publicly-funded hotel for the Columbia Metropolitan Convention Center. The City eventually abandoned its plan under the MOU, and the respondents brought suit on several causes of action including breach of contract and equitable relief. The City moved for summary judgment arguing the MOU was not a contract and therefore the contract claims failed. The circuit court agreed and, rejecting the equitable claims as well, granted summary judgment in favor of the City. The respondents appealed and the court of appeals affirmed in part and reversed in part. The Supreme Court reversed. Because the MOU was comprised of agreements to execute further agreements, there was no meeting of the minds on numerous material terms which had not yet been defined. Accordingly, the court of appeals was reversed with respect to that portion of the court's judgment; the Supreme Court held the MOU was unenforceable as a matter of law. The Supreme Court agreed with the circuit court and reinstated its judgment in favor of the City. View "Stevens & Wilkinson of South Carolina, Inc. v. City of Columbia" on Justia Law