Articles Posted in Contracts

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When P. Thomas Hoff, the founder of One Call Concepts, Inc. and Hanover Investments, Inc. (Hanover), terminated the employment of Susan Volkman and redeemed her shares of Hanover, Hoff and others brought this declaratory judgment action against Volkman in the circuit court to defend the procedures it followed to redeem her stock. At the time the declaratory judgment action was filed, Volkman had already filed, in a Minnesota state court, a breach of contract action against Hanover concerning the same issue. The circuit court refused to dismiss or stay the action in deference to the pending Minnesota action. The court then issued a declaratory judgment in favor of Hanover. The court of special appeals ruled that there were not unusual and compelling circumstances justifying the circuit court’s issuance of a declaratory judgment to resolve the same question at issue in the pending Minnesota litigation. The Court of Appeals affirmed, holding that this action did not create unusual and compelling circumstances that would justify an exception to the principle that a court should not entertain a declaratory judgment action when there was a pending lawsuit involving the same issues. View "Hanover Investments, Inc. v. Volkman" on Justia Law

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A surety who issued a performance bond on a subcontract was not bound by that contract’s arbitration clause when the surety was jointly and severally liable for the “performance of” the subcontract and the entire subcontract was incorporated into the bond by reference. Petitioner entered into a contract with an electrical subcontractor pursuant to a master subcontract agreement that included a mandatory arbitration clause. Petitioner later entered into a subcontract with the electrical subcontractor to perform work on a project. The subcontract incorporated the entire master subcontract agreement by reference. The subcontractor obtained a performance bond from Respondent stating that Respondent was jointly and severally liable for the performance of the construction contract, which was incorporated into the bond by reference. Petitioner terminated the subcontract after a dispute with the electrical subcontractor and filed a demand for arbitration that included Respondent. Respondent requested a declaratory judgment that it was not bound by the arbitration clause. The circuit court granted partial summary judgment in favor of Respondent. The court of special appeals affirmed, ruling that Respondent could not be compelled to participate in the pending arbitration proceedings between Petitioner and the electrical subcontractor. The Court of Appeals affirmed for the reasons stated above. View "Schneider Electric Buildings Critical Systems, Inc. v. Western Surety Co." on Justia Law

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Contractually-shortened limitations periods, such as the one at issue in this case, are valid only if there is no statute to the contrary, the provision is not the result of fraud, duress or misrepresentation, and the provision is reasonable in light of all relevant circumstances. Here a residential furnace maintenance agreement offered by Carroll Home Services, LLC (CHS) reduced the period for a consumer to bring a tort or contract claim against CHS from the statutory three years to one year. Petitioners, who had entered into a maintenance agreement with CHS, asserted tort and contract claims against CHS for damage to their residence allegedly caused by the company. Petitioners filed their complaint more than one year after their claims accrued but before the expiration of three years. The circuit court dismissed the complaint on the basis of the shortened limitations provision in the agreement. The Court of Appeals vacated the judgment of the circuit court and remanded the case for assessment as to whether the criteria for enforcement of the provision were met and whether the provision was reasonable. View "Ceccone v. Carroll Home Services, LLC" on Justia Law

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In this construction contract dispute, White Flint express Realty Group Limited Partnership, LLLP (White Flint) was entitled to recover attorney’s fees in connection with an action to enforce the contract between White Flint and Bainbridge St. Elmo Bethesda Apartments, LLC (Bainbridge). The court of special appeals affirmed the fee award in favor of White Flint, ruling that the contract provided expressly for attorney’s fees to be recovered in a first-party indemnification action. The Court of Appeals affirmed, holding that the contract contained express provisions that authorized first-party fee shifting, and therefore, White Flint was entitled to attorney’s fees. View "Bainbridge St. Elmo Bethesda Apartments, LLC v. White Flint Express Realty Group Limited Partnership, LLLP" on Justia Law

Posted in: Contracts

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In order to recover attorney’s fees against a negligent title searcher using the collateral litigation doctrine, the plaintiff must show that the title searcher’s negligence proximately caused the plaintiff to file a necessary collateral action, resulting in the plaintiff incurring reasonable litigation costs necessarily and in good faith, and that the plaintiff has not otherwise received compensation for those costs. The Ochses purchased property from the Henrys. The Ochses later learned that a encumbrance bisecting their lot was part of a strip of land that had been granted to Dorchester County. Prior to this discovery, the Ochses filed a lawsuit against the Henrys to quiet title. The Ochses later filed a lawsuit against Chicago Title Insurance Company and Eastern Shore Title Company (ESTC), the title examiner, alleging breach of contract and negligence. The trial court found in favor of the Ochses and awarded a $215,710 against ESTC and Chicago Title, which was the amount of the attorney’s fees awarded to the Ochses in the Henry litigation. The trial court subsequently reduced its judgment against ESTC and Chicago Title by $215,710. The Court of Appeals affirmed, holding that the trial court did not err by reducing the damages awarded to the Ochses by the amount previously satisfied by the Henrys. View "Eastern Shore Title Co. v. Ochse" on Justia Law

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Petitioner pled guilty to theft in exchange for the State’s recommendation that she receive no executed jail time. The district court did not follow the State’s recommendation and instead imposed a sentence of thirty days’ incarceration. Petitioner filed a de novo appeal to the circuit court and entered a plea of not guilty. The State subsequently offered a new plea agreement whereby, in exchange for Petitioner’s guilty plea, the State would recommend Petitioner receive thirty days’ incarceration. Petitioner filed a motion to enforce the plea agreement in the circuit court, contending that the state violated the terms of the district court plea agreement by altering its sentencing recommendation. The circuit court denied the motion, concluding that on de novo appeal, the district court plea agreement was no longer enforceable. The Court of Appeals affirmed, holding that the district court plea agreement did not extend to the de novo circuit court proceeding. View "Hartman v. State" on Justia Law

Posted in: Contracts, Criminal Law

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Maryland-National Capital Park and Planning Commission (the Commission) contracted with Fort Myer Construction Corporation to build a pedestrian bridge. After disputes arose, Fort Myer sued the Commission. The Commission impleaded URS Corporation (URS), the engineering firm that created the design documents. The circuit court eventually dismissed Fort Myer’s original complaint, but the claims between URS and the Commission went to trial. Both parties asked the court to award monetary sanctions against Fort Myer on the basis that Fort Myer had litigated its original complaint “without substantial justification.” The circuit court did so. All three parties appealed. The Court of Special Appeals reversed the circuit court’s sanctions awards. The Court of Appeals affirmed, holding (1) the intermediate appellate court properly exercised its jurisdiction to decide Fort Myer’s appeal; and (2) as for the sanctions awards against Fort Myer, the circuit court’s explanation of its reasoning did not support a finding that Fort Myer’s pursuit of its claim was “without substantial justification.” View "URS Corp. v. Fort Myer Construction Corp." on Justia Law

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This suit arose from the actions of iStar’s Board of Directors in modifying performance-based executive compensation awards, which were granted in the form of stock. Petitioners filed suit against current and former members of iStar’s Board and senior management, alleging breach of fiduciary duty, unjust enrichment, waste of corporate assets, breach of contract, and promissory estoppel. The circuit court dismissed all of Petitioners’ claims for failure to state a claim upon which relief can be granted. The Court of Special Appeals affirmed. The Court of Appeals affirmed, holding (1) Petitioners’ claims were properly dismissed by the circuit court for failure to overcome the business judgment rule presumption; and (2) furthermore, Petitioners’ claims for breach of contract and promissory estoppel are derivative claims that are subject to the business judgment rule. View "Oliveira v. Sugarman" on Justia Law

Posted in: Business Law, Contracts

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The parties in this dispute were a city and a design engineer. The city and the design engineer settled their dispute pursuant to an agreement that contained a non-disparagement clause. After the city released the design engineer from all claims relating to the earlier litigation, the city pursued a claim against the engineer’s construction manager for breach of contract. When the design engineer heard of the city’s disparaging statements made during the current lawsuit, it filed a complaint against the city for injunctive and monetary relief, alleging that the city breached the non-disparagement agreement during the current litigation. The circuit court denied injunctive relief and then granted the city’s amended motion to dismiss. The Court of Special Appeals affirmed, holding that no claim can stand for a deliberate and voluntary breach of a non-disparagement agreement when the disparaging statements are made in legal proceedings. The Court of Appeals affirmed, holding (1) the litigation privilege can immunize a party from a claim for breach of a non-disparagement clause; and (2) the city did not waive the litigation privilege in this case. View "O'Brien & Gere Eng'rs, Inc. v. City of Salisbury" on Justia Law

Posted in: Contracts

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Petitioner was terminated from her position as the Clerk-Treasurer of the Town of Hurlock two and one-half years after she entered into a written employment agreement with the Mayor-elect. Under the employment agreement, Petitioner was to serve a four-year term. Petitioner brought this action against Respondent, the Town, alleging breach of contract and seeking damages and other relief. The circuit court dismissed the complaint, concluding that the four-year term of employment in the agreement was inconsistent with the Town Charter and therefore ineffective. The Court of Special Appeals affirmed. The Court of Appeals affirmed, holding (1) the language of the Town Charter means that an official like the Clerk-Treasurer is an at-will employee; and (2) the Mayor and Council of Hurlock lacked authority under the Town Charter to enter into an agreement conferring a fixed term of employment in this case. View "Clough v. Mayor & Council of Hurlock" on Justia Law