Justia Contracts Opinion Summaries

Defendant Bruce Harris appealed a judgment that awarded Plaintiff Linda Smestad over $30,000 for loans she claimed she made to Harris during an eighteen-month business and personal relationship. Harris operated a subchapter-S corporation in which he was the sole shareholder. Smestad had lived with Harris, and wrote a series of checks to Harris, his company, and to others on behalf of Harris and his company. When the relationship ended, Smestad filed suit against Harris to be reimbursed for the checks she wrote on his behalf. Harris represented himself on appeal, and listed 35 one-sentence âissuesâ that were not developed into comprehensible legal arguments. The Supreme Court acknowledged that Mr. Harris did not articulate himself to allow the district court to lend credence to his claims. On review of the record, the Supreme Court reversed only one part of the district courtâs decision relating to Harrisâ âissues.â The Court found that the $30,000 was an oral agreement, and that amount was unenforceable under the statute of frauds. The Court affirmed the lower courtâs judgment in part, reversed in part, and remanded the case for further proceedings.

QT Trading, L.P. ("QT") sued defendants for rust damage to its steel pipes that allegedly occurred during their transport from Dalian, China to Houston, Texas. At issue was whether the district court properly granted summary judgment to in personam defendants on QT's claims for damages under the Carriage of Goods at Sea Act ("COGSA"), 46 U.S.C. 30701 note (Carriage of Goods by Sea), and for negligent bailment of its goods. The court affirmed summary judgment and held that the district court properly dismissed QT's COGSA claims where QT failed to establish genuine issues of material fact where none of the defendants were "carriers" and thus could not be liable for damages under the statute. The court also held that the district court properly dismissed QT's bailment claims where QT failed to show that a certain defendant had exclusive possession of the cargo.

Grubbs Infinity ("Grubbs"), the insured, sued Universal Underwriters of Texas Insurance Company ("Universal") for underpayment of its insurance policy claim after Grubbs suffered hail damage to buildings on its property. At issue was whether the party demanding appraisal had waived its right to insist on the contractual procedure when the parties disagreed, but neither sought appraisal until one had filed suit. The court conditionally granted Universal's petition for writ of mandamus and directed the trial court to grant Universal's motion to compel appraisal where Universal had not waived its appraisal right and where Grubbs failed to demonstrate a showing of prejudice.

Owatonna Clinic-Mayo Health System ("Clinic") sued its insurer, Medical Protective Company ("Medical Protective"), claiming that the company had breached its obligation to defend and indemnify the Clinic in a medical malpractice suit that had resulted in a judgment against it. At issue was whether the district court erred in ruling as a matter of law that the Clinic's notice to Medical Protective, of a potential claim against it, conformed to the insurance policy requirements and whether the Clinic's belief that it was at risk was objectively reasonable. Also at issue was whether the Clinic was entitled to pre-judgment interest. The court affirmed the judgment and held that the Clinic was deemed to have filed a timely notice with Medical Protective where the information that Medical Protective received would obviously alert a reasonable insurer to the likelihood of possible allegations of liability on the Clinic's part. The court also held that Medical Protective's challenge to the district court's finding, that the Clinic's belief that it was at risk was objectively reasonable, was meritless where the quoted policy language set an exceedingly low bar. The court further held that the district court did not err in awarding pre-judgment interest under Minn. Stat. 60A.0811, subd. 2(a) where the statute was unambiguous; and, in the alternative, if the statute was ambiguous, the court construed it against the insurer.

Plaintiff Great Wolf Lodge of Traverse City, LLC (Lodge) is a water park that sits on former farmland. In 2000, the Lodge annexed a new portion of the former farmland to expand its premises. Defendant Cherryland Electric Cooperative (Cherryland) ran an electric line to the former farm. Cherryland insisted that it had exclusive rights to provide electric service to the Lodge. The Lodge did not protest Cherrylandâs assertion in order to keep its expansion project on track. The new Cherryland contract called for discounted rates. Over the course of the contract, Cherryland unilaterally raised the rates. The Lodge filed suit seeking a refund of excess rates it paid to Cherryland, and to have the ability to choose its own electric service provider. A hearing officer would rule in favor of the Lodge on the rate refund, but would not allow it to choose its own service provider, citing Cherrylandâs âright of first entitlementâ that dated back to when it provided service to the farm. The appellate court reversed the hearing officer. One of the issues on appeal to the Supreme Court was whether Cherrylandâs âright of first entitlementâ stopped when the property ownership changed hands. The Court concluded that the right is not extinguished when ownership changes. The Court reversed the judgment of the appellate court, and reinstated the decision of the hearing officer.

Defendant and his wife appeal the trial court's judgment in a breach of contract and lien foreclosure action arising out of a dispute concerning the construction of a single-family home in the town of Greenwich. Defendants challenged all aspects of the trial court's judgment in favor of plaintiff except the portion of the judgment awarding plaintiff loss profit. Plaintiff challenged in his cross-appeal that the trial court improperly accepted the attorney trial referee's determination that the mechanic's lien was invalid and therefore improperly awarded defendants damages under General Statutes 49-8(c). The court held that because plaintiff and third party defendant offered no legal support for the attorney trial referee's finding that the wife was liable for breaching the contract between defendant and plaintiff, the portion of the trial court's judgment that was rendered against her could not stand. The court also held that the judgment of foreclosure must be reversed where there was no evidence that plaintiff furnished any materials or provided any services in connection with the contract balance and that the portion of the judgment awarding plaintiff attorney's fees pursuant to General Statutes 52-249 must also be reversed where such an award was authorized only when a valid judgment of foreclosure had been obtained. The court further held that the parties did not intend to impose liability for delays in the permitting and wetlands approval process and that the attorney trial referee improperly found that plaintiff was entitled to damages for the delays attributable to the change orders. The court also held that because plaintiff was not entitled to recover delay damages, it necessarily followed that any mechanic's lien securing those damages was invalid. The court finally held that the case must be remanded to the trial court for a determination of reasonable attorney's fees in accordance with section 49-8(c).

Plaintiffs-Appellants David and Shirley Fuller appealed a grant of summary judgment in favor of Defendants-Respondents David Callister, Confluence Management (CM), LLC and Liberty Partners, Inc. (LP). CM wanted to buy over twelve acres of land from the Fullers. At the same time, the Ada County Highway District (ACHD) attempted to acquire part of that property for a right-of-way in order to expand a portion of a road. After executing its contract with the Fullers, CM executed an addendum to the contract where it agreed to deed over a portion of the property to ACHD, and to transfer the proceeds of that conveyance to the Fullers. CM assigned the contract to LP with the consent of the Fullers. The Fullers executed a warranty deed conveying the property to LP which made no mention of the addendum to ACHD. ACHD paid LP for the property, and the Fullers requested LP turn that money over to them in accordance with the addendum. When LP refused, the Fullers sued. Ultimately CM and LP won at the district court. The court held that the addendum merged with the warranty deed, and therefore gave the Fullers no right to collect the proceeds from the sale of land to ACHD. CM was dismissed from the suit having executed a novation to LP. Upon review, the Supreme Court held that the lower court erred in its decisions in favor of CM and LP. The Court found that the addendum did not merge. Furthermore, the Court found the CM/LP novation was invalid, and that the Fullers could maintain their suit against CM. The Court vacated the district courtâs judgment and remanded the case for further proceedings.

The Supreme Court reviewed the appellate courtâs decision against Plaintiffs Jack and Danette Steele. In their claim, Plaintiffs alleged that attorney Katherine Allen gave them incorrect information about a statute of limitations, which led to missing a filing deadline in a negligence suit. The trial court dismissed both their claims of negligent misrepresentation and professional negligence. Plaintiffs only appealed the dismissal of their negligent misrepresentation claim. The appellate court held that Plaintiffs had a claim against the attorney. However, the Supreme Court disagreed, finding that Plaintiffsâ evidence was not sufficient to support their claim. The Court reversed the decision of the appellate court and remanded the case for further proceedings.

In 2001, a company calling itself âComputer Geeks, a California corporation,â sued Plaintiff Jason Wright in Utah state court for failing to assign a domain name. Mr. Wright did not respond to the companyâs motion for summary judgment, and in 2006, the state court granted the motion and entered judgment against him. Mr. Wright hired Appellant-Attorney Russell Cline to have the judgment set aside or modified. In 2008, Appellant filed a motion to set the judgment aside. As it turns out, âComputer Geeks, a California corporationâ is not related to the company that held the Utah state judgment. Appellant was made aware of the mistaken identity soon after Appellant served âComputer Geeks, a California corporation.â Appellant represented to the clerk of the district court that he had properly served âComputer Geeks, a California corporation.â The clerk entered a default, and Appellant moved for a default judgment. Within a few weeks, Defendant CompGeeks.com moved to vacate the default judgment. At the hearing, Appellant acknowledged he knew the difference between the two companies, but that he served the correct holder of the Utah judgment. The district court found that Appellant had filed a frivolous action in violation of state law, and dismissed the case. The court referred Appellant to the state attorney disciplinary committee, and awarded attorneyâs fees to CompGeeks.com, making Mr. Wright and Appellant jointly and severally liable for the award. Appellant moved to vacate the award of attorneyâs fees, alleging the district court abused its discretion in its decision. On review, the Tenth Circuit âsympathize[d] with the district courtâs frustration with [Appellantâs] conduct,â but held that â Rule 11 does not allow a sua sponte award of attorney fees.â Accordingly the monetary sanctions order was vacated, and the Court remanded the case for further proceedings.

Appellant Mildred Powell filed an insurance claim with respondent Liberty Mutual Fire Insurance Company to cover damage to her house. Liberty Mutual denied the claim, stating that the damage was excluded under the âearth movement exclusionâ in Appellantâs insurance policy. Appellant took Liberty Mutual to the district court. The court eventually granted Liberty Mutualâs motion for partial summary judgment, concluding that the âearth movement exclusionâ of the policy excluded coverage of the damage. Appellant challenged the district courtâs review of the policy, arguing that it was contrary to state law on a similar âearth movement exclusion.â The Supreme Court concluded that Liberty Mutualâs policy was ambiguous held in light of the applicable state law. The Court held that the district court erred in granting the company summary judgment, and reversed its holding. The Court remanded the case for further proceedings.