Justia Contracts Opinion Summaries

This case arose because the settlement of a personal-injury suit brought by a recipient of workers' compensation benefits against a third-party tortfeasor did not make any provision to repay the statutory subrogee, the Ohio Bureau of Workers' Compensation. The Bureau brought suit against both the recipient of the workers' compensation benefits and third-party tortfeasor under Ohio Rev. Code 4123.931(G) to recover the full amount of its subrogation interest. The trial court held that a two-year limitations period applied and that it had expired. The court of appeals reversed, holding that a six-year limitations period applied and that it had not yet run out. At issue on appeal was whether a claim under section 4123.931(G) brought by a statutory subrogee to recover its subrogation interest is subject to a two-year statute of limitations, the same period applicable to the injured worker's personal-injury suit against the third party, or to a six-year statute of limitations for an action on a liability created by statute. The Supreme Court affirmed the court of appeals, holding that the claim in this case was an action upon a liability created by statute and that the statute of limitations was six years.

Mother consented to the adoption of her two biological children, after which the children were placed in the legal care of Guardians. Guardians later arranged for the adoption of the children by Adoptive Parents and relinquished the children. After six months of living with Adoptive Parents, Guardians moved to have their relinquishment and consent to adoption set aside, claiming their consent was fraudulently obtained by their reliance on a deficient pre-placement evaluation provided to them by Adoptive Parents. The district court denied the motion. The Supreme Court affirmed, holding that because Guardians failed to establish the existence of actual or constructive fraud by clear and convincing evidence, there was no statutory basis to set aside the relinquishments and consents given by Guardians.

Do Nguyen, Jana Nguyen, Kenny Nguyen and John Doeâs (collectively "the Nguyens") appealed a district court's grant of a motion to set aside a default judgment in favor of Janice Maynard. On appeal, Maynard contended that the district court abused its discretion in setting aside its previously entered default judgment. In 2006, Maynard filled out an application to rent a trailer home from the Nguyens and reached an agreement with the Nguyens under which Maynard would receive title to the home if she paid $500 in rent each month for a period of three years. In 2008, Maynard reported to the Ada County Jail to serve a sentence, and when she returned home on November 27, 2008, she discovered that the Nguyens had removed her belongings from the trailer home and rented the trailer to other tenants. In 2009, an evidentiary hearing was held on the issue of damages. At the beginning of that hearing Maynardâs attorney told the court that he had received a two-page letter on June 29, 2009, which was addressed to "[counsel for Maynard], Janice Maynard and To Whom it May Concern." Counsel asked whether the court had received that letter, and described various documents which were attached to it. When the court said that it had not received the letter, the attorney offered no further information concerning the letterâs contents, but proceeded to present evidence concerning damages. The district court entered a default judgment against the Nguyens in the amount of $3,265 in actual damages and an enhanced penalty of $15,000 for the ICPA violation. The Nguyens filed a motion to set aside the default judgment. The Nguyens noted that they had sent Maynardâs attorney a letter explaining their version of events and why they believed that Maynard had abandoned the trailer home. On December 7, 2009, the district court granted the Nguyensâ motion to set aside the default judgment, finding that the Nguyens had demonstrated that there were unique and compelling circumstances justifying relief. Upon review of the trial court record, the Supreme Court affirmed the district courtâs order setting aside the default judgment and remanded the case for further proceedings.

Defendant AIA Services Corporation entered into a stock redemption agreement with Appellant Reed Taylor to purchase all of his shares in AIA Services for a $1.5 million down payment promissory note and a $6 million promissory note, plus other consideration. When AIA failed to pay the $1.5 million when it became due, Appellant and AIA agreed to modify the stock redemption agreement. AIA was a still unable to make payments under the new terms. Appellant then filed suit to recover the amounts owed on the two promissory notes. The district court granted partial summary judgment in favor of AIA and dismissed six of Appellant's causes of action after finding the revised stock redemption agreement was unenforceable. On appeal, Appellant argued the redemption agreement complied with state law and was still enforceable. Upon review, the Supreme Court affirmed the district court's holding that the agreement was illegal and unenforceable and affirmed the court's dismissal of Appellant's six causes of action.

Appellants, PNH Inc. and Ronald Creatore, filed an action against Alfa Laval Flow, Inc., which manufactures equipment for sanitary processing of food and beverages, for abuse of process and tortious interference with a contract. Appellants asserted that Alfa Laval Flow misused an involuntary-bankruptcy case it filed against its distributor in an effort to eliminate Creatore as a competitor in the sale of equipment for sanitary processing of food and beverages. The trial court dismissed the claims. The Seventh District affirmed, holding that federal law preempts state-law causes of action alleging the abuse of bankruptcy proceedings. The Supreme Court affirmed, holding that the United States Bankruptcy Code preempts state-law claims that allow the recovery of damages for misconduct committed by a litigant during bankruptcy proceedings.

Several purchasers of condominium units sued developer Harborage Cottages-Stuart, LLLP (Harborage), alleging that Harborage violated the Interstate Land Sales Full Disclosure Act (ILSFDA), 15 U.S.C. 1701 et seq., and several Florida statutes. Central to this appeal was whether Harborage violated section 1703(a)(1)(B) by failing to provide the purchasers with a property report prior to their signing the purchase agreements. The court held that Harborage failed to prove that it was entitled to an exemption from the ILFSDA and its admitted failure to provide the report violated the ILFSDA. Therefore, the court affirmed the district court's grant of summary judgment in favor of plaintiffs on their claim under section 1703(a)(1)(B) and (C). The court also affirmed the district court's award of damages and attorney's fees under section 1709; affirmed the grant of summary judgment in favor of Gentry-Hunt on the claim that Harborage violated Fla. Stat. 718.506 and vacated the judgment in favor of the Stones on the section 718.506 claim; and vacated the grant of summary judgment in favor of plaintiffs on the claim that Harborage violated the anti-fraud provision of the ILSFDA and the claim asserted under Fla. Stat. 501.204(1).

This case stemmed from an Excess Disability Income Reinsurance Agreement (Treaty). At issue was whether a reinsurance agreement between plaintiff and defendant contained a follow-the-settlements provision. The court held that there was no ambiguity in the Treaty and that it contained a follow-the-settlements provision. The court also held that the statute of limitations barred plaintiff's challenges to several claims submitted by defendant and defendant's conduct did not give rise to tolling under Connecticut law. The court further held that the district court properly granted summary judgment on defendant's counterclaims for breach of contract and for breach of the implied covenant of good faith and fair dealing.

Defendant appealed the district court's order denying its motion to compel plaintiff to submit her claims to arbitration pursuant to an arbitration agreement governed by the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq. The district court held that defendant had, by participating in the litigation for nine months prior to requesting that the case be submitted to arbitration, waived its contractual right to compel arbitration. The court found that defendant's right to compel arbitration, even if waived with respect to the claims in the Original Complaint, was revived by plaintiff's filing of the Amended Complaint. Therefore, the court vacated the district court's order denying defendant's motion to compel arbitration and stay the proceedings, remanding for further proceedings.

In this appeal, accounting firm Bryan Brothers sought coverage under a professional liability insurance policy issued by Continental Casualty Company for liability arising from illegal acts of a former Bryan Brother's employee. Under the policy, it was a condition precedent to coverage that no insured had knowledge, prior to the inception of the policy, of an act that was reasonably likely to become the basis for a claim. The court held that because Bryan Brothers had such knowledge, the claims at issue were not covered. Therefore, the court affirmed the district court's grant of summary judgment to Continental Casualty Company.

Plaintiff sued her employer under the Minnesota Human Rights Act (MHRA), Minn. Stat. 363A.01-43, and the Family Medical Leave Act (FMLA), 29 U.S.C. 2601-54, and asserted other state common law claims including breach of employment contract. Plaintiff subsequently appealed the dismissal of her breach of contract claim with prejudice, the denials of her motions for leave to amend her complaint, the denial of her motion for consideration, and the adverse grant of her MHRA and FMLA claims by the district court. The court did not reach the merits of plaintiff's arguments because any error with respect to the dismissal of the breach of employment contract claim was harmless where plaintiff resigned from her employment with the county and failed to generate a genuine issue of fact as to constructive discharge in the context of her MHRA reprisal claim. The court also held that because plaintiff failed to generate an issue of fact as to whether she suffered a materially adverse employment action, summary judgment was appropriate as to her MHRA retaliation claim. The court further held that summary judgment was properly granted on plaintiff's FMLA interference claim where plaintiff did not contest the district court's finding that she received the full twelve weeks of FMLA leave to which she was entitled each year she requested it. The court finally held that summary judgment was properly granted on plaintiff's FMLA retaliation claim where she failed to generate an issue of fact as to whether she suffered an adverse employment action.