Justia Contracts Opinion Summaries

Plaintiff first sued tennis star Connors in 1997; the suit settled with payment of $10.5 million by Connors and an agreement that provided mutual promises of indemnification. In 2010, plaintiff's former law partner sued plaintiff, claiming fraud and concealment with respect to the money from Connors. Plaintiff sought indemnification. The district court dismissed, holding that the indemnity provision created an infinitely repeating loop of liability and failed by its terms; Illinois public policy generally prohibits contractual indemnification for intentional misconduct; and the indemnity provision was not specific enough to exempt it from the general rule. The Seventh Circuit affirmed, holding that the indemnity provision does not apply to this matter, and, if it did, would be unenforceable under Illinois public policy.

Plaintiff contracted to purchase 11 Burger King restaurants. A jury found that defendant had properly terminated the agreement but had breached the duty of good faith and fair dealing, and awarded $190,907.27. Over one year later, the district court entered a partial judgment denying specific performance and awarding $5,176.24 of the $424,282.19 in attorneysâ fees and expenses incurred in connection with the litigation. The Sixth Circuit reversed and remanded. The plaintiffs presented evidence that defendant hindered attempts to close the transaction, but defendant's actions in blocking due diligence and failing to provide financial information did not cause plaintiff damages because defendant properly terminated the agreement. The district court erred in calculating fees and expenses.

Jacklin Land Company (Jacklin) owned real property that it developed into a commercial industrial complex. The development was subject to multiple covenants, conditions and restrictions (CC&Rs). One of the CC&Rs was that the development was not intended for retail businesses. In April 2008, Blue Dog RV, a retailer, began negotiating with Jacklin about the purchase of land in within the complex. During the course of the negotiations, Blue Dog also discussed renting four undeveloped lots across the street, but still within the complex. KL Properties owned those four lots. Ultimately Blue Dog leased space from KL Properties. Citing the CC&Rs, Jacklin sent notice to Blue Dog to vacate the KL leased space. When further negotiations between the parties proved unfruitful, Jacklin filed suit to enjoin KL Properties and Blue Dog from using the space for RV retail. The trial court ruled in KL and Blue Dog's favor. On reconsideration, the court issued an injunction against Blue Dog for violation of the CC&Rs. Upon review, the Supreme Court found that the district court's injunction was technically flawed because it did not give "explicit notice of precisely what conduct was outlawed," and that it enjoined unknown persons who were not party to this action. The Court vacated the district court's judgment, and remanded the case for further proceedings.

Plaintiffs Stephen and Marilee Bell hired contractor Defendant Perception Construction Management, Inc. (PCM) to build a log home. The parties' relationship deteriorated, and the Plaintiffs terminated the contract before construction was complete. Plaintiffs refused to pay PCM's final invoices, and PCM filed suit to enforce a lien it placed on the home for the unpaid invoices. Plaintiffs filed multiple counterclaims, including construction defect and breach of contract. PCM prevailed at trial, and the district court found PCM was entitled to damages, prejudgment interest and attorney fees. Plaintiffs appealed, contending that the district court erred by excluding certain evidence relating to their defense against the lien, and in its determination of the monies allegedly owed under the lien. The Supreme Court found that the district court impermissibly excluded Plaintiffs' evidence, and as such, the Court vacated the district court's judgment and remanded the case for further proceedings.

Brady Dougan and Tomoko Dougan entered into a stipulation for judgment dissolving their marriage that contained a provision ordering Brady to pay interest if he failed to make payments to Tomoko. Both of the parties entered into the agreement with knowledge of its terms, and the trial court found the stipulation for judgment to be fair and reasonable. When Brady later failed to render a complete payment to defendant, Tomoko moved for enforcement of the stipulation and requested that the trial court order the plaintiff to pay her interest in accordance with the terms of the judgment. The trial court held that the provision for interest was invalid and unenforceable as against public policy. The appellate court reversed the judgment of the trial court. On Brady's appeal to the Supreme Court, Tomoko was granted special permission to raise the alternate ground that the judgment of the appellate court should be affirmed because the doctrine of judicial estoppel supports the enforcement of the interest provision. The Court agreed with Tomoko and affirmed the judgment of the appellate court, finding the doctrine of judicial estoppel barred Brady from claiming the provision was unenforceable.

In a 1905 water exchange agreement, Big Ditch Irrigation Company conveyed its Big Cottonwood Creek water right to the Salt Lake City Corporation in exchange for the City's commitment to supply Big Ditch with a specified quantity of irrigation-quality water from City sources. Concerned that Big Ditch was infringing upon the City's water rights, the City initiated this case against Big Ditch and four Big Ditch shareholders in district court. The City sought declaratory judgment on several issues. Big Ditch and the shareholders counterclaimed. The district court granted summary judgment in favor of the City on most major issues. On appeal, the Supreme Court held that the district court properly dismissed the defendants' counterclaims and correctly concluded that the City holds title to the water rights conveyed in the agreement. The Court held, however, that the district court erred in (1) determining that Big Ditch did not have a right to file change applications; (2) determining that the parties had modified the agreement or, alternatively, that Big Ditch was estopped from enforcing its right to the amount of water specified in the agreement; and (3) refusing to dismiss the City's claims against the shareholders.

Russell and Melissa Levens and Al Ballard, neighboring property owners, entered into an agreement defining the location of the boundaries of their properties. The agreement provided that Ballard would not excavate on his property within thirty feet of the Levens' property. After Ballard occupied the area between the two properties and refused to sign a certificate of survey pursuant to the agreement, Levens brought an action against Ballard to enforce the agreement and for an injunction. The district court enjoined Ballard from excavating on the disputed property and later granted Levens' motion for summary judgment. Levens later filed a motion for contempt against Ballard for failure to abide by the judgment. The district court denied the motion and entered an order awarding attorney fees to Ballard. On appeal, the Supreme Court reversed the orders, holding that the judgment must be construed to prevent Ballard from excavating in such a way that the pit intrudes into the thirty-foot buffer strip at the edge of Levens' property.

Plaintiff Leonard Brown entered into an employment agreement with the Yellowstone Club that employed Brown for a term of three years and provided that Brown's employment could be terminated at any time without cause. After six months, the Club terminated Brown's employment without cause. Brown brought an action for damages against the Club under the Wrongful Discharge from Employment Act. The district court granted the Club's motion to dismiss the action based upon Mont. Code Ann. 39-2-912(2), which exempts from the Act an employee covered by a "written contract of employment for a specified term." The Supreme Court reversed the judgment of the district court, holding that if an employment contract for a specific term also allows the employer to terminate at will, it is not a "written contract for a specific term" under Section 39-2-912. Therefore, a discharged employee covered by such a contract is not excluded by the statute from bringing a claim under the Act.

This case stemmed from a dispute over the status of a negotiated settlement agreement pertaining to New York City's duty to provide mental health services to certain inmates in its jails. At issue was whether the terms of the agreement expired before plaintiffs filed a motion in Supreme Court seeking to extend the City's obligations. Applying the state's traditional principles of contract interpretation, the court held that plaintiffs sought relief prior to termination of the settlement agreement and their motion was therefore timely filed.

Twenty three former tribal employees sued the Seneca-Cayuga Tribe of Oklahoma for breach of employment contracts. The contracts contained a limited waiver of sovereign immunity. Tribal law requires that waiver of sovereign immunity must be consented to by the Business Committee of the Tribe by resolution. The trial judge, on motion for reconsideration, granted the Tribe's motion to dismiss for lack of subject matter jurisdiction and dismissed the case. On appeal, the question before the Supreme Court was whether the Tribe expressly and unequivocally waived its sovereign immunity with respect to Plaintiffs' employment contracts. Upon review of the contracts and the applicable tribal resolutions and legal standards, the Supreme Court held that waiver of sovereign immunity was neither expressed nor consented to in the Business Committee's resolutions that authorized the Chief to sign the employment contracts. The Court affirmed the lower courtâs decision.