Justia Contracts Opinion Summaries

The Corps contracted with Atlantic for the construction of a child development center and Atlantic entered into a Subcontract Agreement with J-Crew for labor and materials. The Subcontract Agreement included a forum-selection clause, which provided that disputes shall be litigated in Virginia courts. Ignoring the forum-selection clause, J-Crew filed suit against Atlantic in Texas. Applying 28 U.S.C. 1404(a), the district court denied Atlantic's motion to transfer, finding that Atlantic had not met its burden of showing why the interest of justice or the convenience of the parties and their witnesses weighed in favor of transferring the case to Virginia. Atlantic subsequently petitioned the court for a writ of mandamus to dismiss or transfer the case. Because the court found that the district court did not clearly abuse its discretion by considering enforcement of the forum-selection clause under section 1404(a), instead of under Rule 12(b)(3) and section 1406; and by conducting its analysis under section 1404(a), the court denied the petition. View "In re: Atlantic Marine Const Co. Inc." on Justia Law

At issue in this appeal was whether the parties' contract language specifying that Seller's "sole remedy" was liquidated damages and Seller had "no further rights" against the defaulting purchaser (Buyer), trumped language in N.Y. C.P.L.R. 5001(a) directing that statutory interest be awarded in a contract dispute. Buyer commenced this action to recover its down payment. Supreme Court rendered a judgment awarding Buyer the down payment plus statutory interest. The Appellate Division modified to vacate the award of statutory interest. The Court of Appeals affirmed, holding (1) the contract language controlled in this instance; and (2) therefore, Buyer was not entitled to statutory pre-judgment interest. View "J. D'Addario & Co. v. Embassy Indus., Inc." on Justia Law

At issue in this appeal was whether an action for negligence and breach of contract lies against an insurance broker for failure to procure adequate insurance coverage where the insured receive the policy without complaint. Plaintiff commenced this action against its broker for negligence and breach of contract in connection with Defendant's procurement of insufficient insurance. Supreme Court denied Defendant's motion for summary judgment, finding that issues of fact existed as to Plaintiff's request for specific coverage. The Appellate Division reversed, concluding that Plaintiff's failure to read and understand the policy precluded recovery in this action. The Court of Appeals reversed, holding (1) because there were issues of fact as to whether Plaintiff requested specific coverage for its employees and whether Defendant failed to secure a policy as requested, summary judgment was inappropriate in this matter; and (2) Plaintiff's failure to read and understand the policy should not be an absolute bar to recovery under the circumstances of this case. View "Am. Bldg. Supply Corp. v. Petrocelli Group, Inc." on Justia Law

A collective-bargaining agreement between Baltimore County and Baltimore County Fraternal Order of Police, Lodge 4 (FOP) contained an arbitration clause and a retiree health-insurance provision. FOP believed the provision locked in place the health-insurance subsidy as it existed at the time of an officer's retirement. After the agreement expired and the County decreased the health-insurance subsidy, FOP initiated arbitration. The County protested, arguing (1) it had no duty to arbitrate because the collective-bargaining agreement had expired, and (2) the health-insurance subsidy was not locked in place but was subject to change from year to year. FOP was successful in arbitration and on appeal before the circuit court, but the court of special appeals vacated the arbitration award. The Court of Appeals reversed, holding (1) an arbitration clause may survive the expiration of a collective bargaining agreement when it concerns rights that vested during the life of the agreement; and (2) when deciding the issue of arbitrability requires interpretation of the underlying agreement and consideration of the merits of the dispute, the issue of arbitrability should initially be determined by the arbitrator. View "Baltimore County Fraternal Order of Police Lodge v. Baltimore County" on Justia Law

The issue before the Supreme Court in this case was a jury verdict in favor of the sellers of real property in an action by the buyers to recover damages or be granted rescission of the sale contract on the ground that the sellers made misrepresentations and breached the contract and the Idaho Property Condition Disclosure Act. The buyers also sought to raise the issue of mutual mistake. About a year after purchasing the property, Buyers hired a contractor to see if the garage could be enlarged. The Contractor discovered that the building permit obtained to construct the garage had not been finalized, so that it had lapsed. The permit had been issued in 2000 to construct a garage with storage space above it. In connection with the sale, Sellers completed and delivered to Buyers a property disclosure form as required by the Idaho Property Condition Disclosure Act. When completing that form, Sellers answered "No" to the question: "Have any substantial additions or alterations been made without a building permit?" In 2007, Buyers filed this lawsuit against Sellers seeking damages for breach of the Disclosure Act, misrepresentation, and breach of contract. They also sought, in the alternative, to have the real estate contract rescinded. The matter was tried to a jury in 2010, on the three theories seeking damages. The jury returned a special verdict finding that Buyers had failed to prove a violation of the Disclosure Act, had failed to prove misrepresentation, and had failed to prove a breach of contract. On the second day of trial, Sellers moved to prevent Buyers from raising the issue of mutual mistake of fact, which Buyers had apparently discussed in their pretrial brief. The matter was argued, and the district court ruled that Buyers could not present evidence regarding mutual mistake because it had not been pled. On February 25, 2010, and again on March 8, 2010, Buyers moved to amend their complaint to conform to the evidence by adding a request for rescission based upon mutual mistake. On March 8, 2010, Buyers moved to have the real estate contract rescinded, and on August 30, 2010, they moved for a new trial. The district court denied those motions, and Buyers timely appealed. Upon review, the Supreme Court affirmed the judgment of the district court and the court's denial of the motion for a new trial. View "Bolognese v. Forte" on Justia Law

Plaintiffs were injured when their vehicle was struck by a vehicle driven by Ida Trayter. Trayter's insurer tendered its liability limits, after which Plaintiffs sought underinsured motorist coverage from their insurer, State Farm. State Farm advised Plaintiffs that its settlement offer would be based on the "net" value of the claim after reduction of the liability limits and medical payments already received by Plaintiffs. Plaintiffs filed suit against State Farm seeking a declaratory judgment that a non-duplication provision and reimbursement provision in State Farm's underinsured motorist policy violated W. Va. Code 33-6-31(b). The circuit court granted partial summary judgment to Plaintiffs, finding both provisions at issue violated the statute. The Supreme Court reversed, holding (1) a non-duplication of benefits provision in an underinsured motorist policy, which permits an insurer to reduce an insured's damages by amounts received under medical payments coverage, does not violate the "no sums payable" language of section 33-6-31(b), and the circuit court erred in holding otherwise; and (2) the circuit court's consideration of and entry of summary judgment on the reimbursement provision was erroneous because the provision was not ripe for adjudication in this matter. View "State Farm Mut. Auto. Ins. Co. v. Schatken" on Justia Law

This case involved a district court's denial of coverage under a fire insurance policy. A husband and wife had an insurance policy on their home. The policy included an intentional loss exclusion, voiding coverage when any insured intentionally causes a loss or damage. The district court denied coverage because the husband attempted suicide by pouring gasoline on himself and his home and lit himself on fire. The Supreme Court affirmed, holding (1) a coinsured who sets fire to the insured dwelling in order to commit suicide has the requisite intent to "cause a loss" under the policy; (2) under the language of the policy, the innocent coinsured spouse, who did not participate in the intentional acts of the other coinsured, cannot recover due to the intentional loss exclusion; and (3) the innocent coinsured cannot recover under the recently amended Iowa standard fire policy in Iowa Code 515.109. View "Postell v. Am. Family Ins. Co." on Justia Law

Plaintiffs purchased a home along the Cedar River. At the time, they were told, incorrectly, that the property was not in a special flood hazard area and that flood insurance would not be required as a condition of their loan. Plaintiffs received the same erroneous information when they refinanced their loan to pay for remodeling. Years later, their loan servicer was advised that the property actually was in a special flood hazard area. However, this information was not passed along to Plaintiffs until after their home had flooded and it was too late to buy flood insurance. Plaintiffs brought suit against the lender as well as the loan servicer. The district court granted summary judgment to Defendants. The Supreme Court (1) reversed in part, finding a claim could potentially exist based on Restatement (Second) of Torts, 551(2); and (2) affirmed the remainder of the district court's judgment. Remanded. View "Bagelmann v. First Nat'l Bank" on Justia Law

Two real estate developers, a husband and wife, operated through various entities including a corporation and an LLC. In 2002, the corporation borrowed money from a lender; the developers, in their individual capacities, guaranteed this loan and all future advances. The corporation promptly repaid this loan. In 2005, the LLC twice borrowed money from the same lender. The lender originally insisted on a personal guaranty for these loans, but, in order to secure the developer's business, stated that no personal guaranty would be required. In 2006–07, the corporation again borrowed money from the lender in six separate loans. The corporation defaulted on these six loans, and, after the lender foreclosed on the real estate that served as collateral for the loans, the lender sued the developers for the deficiency. The district court granted the lender's motion for summary judgment, holding that the developers' affirmative defenses (1) were barred by the statute of frauds, (2) failed for lack of consideration, and (3) raised no genuine issues of material fact. The developers timely appealed to the Supreme Court. Upon review, the Court held that the developers' affirmative defenses were neither barred by the statute of frauds nor failed for lack of consideration. However, because none of those defenses raised a genuine issue of material fact, the Court affirmed. View "Washington Federal Savings v. Engelen" on Justia Law

Plaintiff was injured in an automobile accident with Stephen Stanton. At the time, Plaintiff was operating a vehicle owned by his employer, Bambardier Aerospace Corporation, and Stanton was driving a vehicle owned by his employer, the City of Elkins. Plaintiff and his wife filed an action against the City and Stanton to recover for injuries. Plaintiffs' personal automobile insurer, Westfield Insurance, filed a crossclaim against the City and Stanton and a third party claim against Bombardier and National Union Fire Insurance. The trial court entered an order finding (1) the City, Stanton, and National were immune from liability; (2) Bombardier and Westfield were subject to a payment of damages of not more than $20,000 each; and (3) Plaintiffs were not entitled to auto medical coverage under the policy covering Bombardier and the policy issued by Westfield. The Supreme Court (1) reversed the circuit court's order to the extent it held the uninsured motorist policies for Bombardier and Westfield were not enforceable above the mandatory limits of uninsured motorist coverage required by W. Va. Code 33-6-31; (2) reversed the court's order to the extent it denied Plaintiffs auto medical payment benefits under Bombardier's policy; and (3) affirmed the remainder of the court's judgment. View "Jenkins v. City of Elkins" on Justia Law