Articles Posted in Contracts

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Autauga, a cooperative that pools and markets farmers’ cotton, claims that the Crosbys breached a marketing agreement when they failed to deliver their promised cotton for 2010 and sought liquidated damages ($1,305,397) under the agreement’s liquidated-damages provision, which provides: the Association shall be entitled to receive for every breach of this agreement for which such equitable relief is unavailable, liquidated damages in an amount equal to the difference between (a) the price of such cotton on the New York futures market during the period beginning with the date of breach or default by the Grower (taking into account the grade, staple, and micronaire of such cotton) and ending with the final delivery by the Association of cotton sold during that year, and (b) the highest price per pound received by the Association for the membership cotton (of the same or nearest grade, staple, and micronaire) sold by it from the same year’s crop. The Eleventh Circuit held that, under Alabama law, the provision that Autauga seeks to enforce is not a valid liquidated-damages clause but an impermissible penalty that is void and unenforceable. There is no evidence that the liquidated-damages formula here bears any relation to Autauga’s probable loss. View "Autauga Quality Cotton Association v. Crosby" on Justia Law

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The Eleventh Circuit reversed the district court's grant of summary judgment against two transportation companies, Barrett and Landstar, in an action by Nationwide and its insurer, Essex, seeking to recover loss of an MRI under the Carmack Amendment, 49 U.S.C. 14706 et seq. The court held that the Magistrate Judge applied the correct standard for distinguishing brokers from carriers, but that there was a genuine factual dispute as to whether Barrett accepted legal responsibility to transport the magnet or communicated to Nationwide that it was brokering the shipment of the magnet to a third party. The court applied the holding in Werner Enterprises, Inc. v. Westwind Maritime International, Inc., 554 F.3d 1319 (11th Cir. 2009), to this case, and held that Landstar was entitled to rely on the Broker-Carrier Agreement's (BCA) limitation of liability, because the BCA satisfied the Carmack Amendment's requirements. In this case, Landstar was entitled to the $1.00 per pound liability limitation in the bill of lading. Therefore, the court remanded for further proceedings. View "Essex Insurance Co. v. Barrett Moving & Storage, Inc." on Justia Law

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Winn-Dixie filed suit against Big Lots, Dollar General, and Dollar Tree, to enforce a grocery exclusive provision of its leases. At issue on appeal was the district court's ruling on remand. The district court found that none of the Alabama stores was violating the grocery exclusive provisions. In regard to the Florida stores, the district court ruled that the definitions of "groceries" and "sales area" in Winn-Dixie Stores, Inc. v. 99 Cent Stuff-Trail Plaza, LLC, 811 So. 2d 719 (Fla. 3d DCA 2002), applied. The Eleventh Circuit reversed the district court's judgment as to the Dollar General and Big Lots stores in Florida and remanded with instructions for the district court to apply to those stores, which had leases dated before February 20, 2002, the same definitions of "groceries" and "sales area" that it applied to the Florida stores with leases dated after February 20, 2002. The court affirmed as to the Alabama stores. View "Winn-Dixie Stores, Inc. v. Dolgencorp, LLC" on Justia Law

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Cita Trust appealed the district court's dismissal of its complaint against Fifth Third Bank in a commercial contract dispute action. The Eleventh Circuit affirmed, holding that the district court did not err by dismissing the complaint as untimely and enforcing the contractual one-year limitation period. In this case, the agreement's limitation provision was reasonable, clear, and unambiguous. Furthermore, the district court did not abuse its discretion when it denied Cita leave to amend its complaint, because Cita did not properly move for leave to amend. View "Cita Trust Company AG v. Fifth Third Bank" on Justia Law

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The M/V Deep Blue purchased fuel from a supplier, the supplier purchased the fuel from an affiliate, and the affiliate subcontracted with Radcliff. Radcliff subsequently asserted a maritime lien on the Deep Blue in a bid to recover directly from the ship, giving rise to this litigation. The Fifth Circuit affirmed the district court's determination that Radcliff did not have a lien on the Deep Blue. Instead, a lien had arisen in favor of the global fuel supplier, and was duly assigned to ING Bank, an intervenor in the suit. View "Barcliff, LLC v. M/V Deep Blue" on Justia Law

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This appeal arose out of the Ponzi scheme orchestrated by Scott Rothstein through his law firm, Rothstein Rosenfeldt Adler (RRA). Trustees of RRA filed suit alleging breach of contract and bad faith claims against insurance carriers that reached a settlement with Gibraltar and its executives after originally denying coverage. The Eleventh Circuit applied Florida law and exercised plenary review, holding that coverage was barred by a "professional services exclusion" found in each of the policies. Accordingly, the court affirmed the district court's grant of the insurers' motion to dismiss. View "Stettin v. National Union Fire Insurance Co." on Justia Law

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Answering certified questions from the Eleventh Circuit, the Supreme Court of Georgia concluded that, while O.C.G.A. 9-11-67.1 sets forth certain terms and conditions that must be included in every written offer of settlement, nothing in Georgia law or the statute precludes parties from requiring "some additional act to effectuate acceptance;" O.C.G.A. 9-11-67.1 permits unilateral contracts whereby Pre-Suit Offers may demand acceptance in the form of performance before there was a binding enforceable settlement contract; and O.C.G.A. 9-11-67.1 does not preclude a Pre-Suit Offer from demanding timely payment as a condition of acceptance. In light of these answers, the Eleventh Circuit held that the district court correctly determined that O.C.G.A. 9-11-67.1 does not prohibit a party from requiring timely payment as a condition of acceptance of a settlement offer; the offer letter in this case unambiguously conditioned acceptance on timely payment; the insurers' issuance of two $50,000 checks with incomplete addresses, which never reached defendants or their attorney, did not satisfy this timely-payment condition; and the insurer failed to accept defendants' settlement offer, thus preventing the formation of a binding settlement agreement. Accordingly, the court affirmed summary judgment for defendants. View "Grange Mutual Casualty Co. v. Woodard" on Justia Law

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Plaintiff filed suit against U.S. Specialty for breach of contract, based on its denial of coverage of fraudulent transfer claims in an underlying suit. The district court entered summary judgment for U.S. Specialty and entered judgment against plaintiff. The Eleventh Circuit affirmed, holding that, in light of Florida law, plaintiff's fraudulent conveyance claims "arose from" wrongful acts that predate November 10, 2008, and thus fell within the scope of the Prior Acts Exclusion of the U.S. Specialty policy. Furthermore, the policy's terms were unambiguous and its coverage was not illusory. Therefore, U.S. Specialty did not breach the insurance contract. View "Zucker v. U.S. Specialty Insurance" on Justia Law

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Plaintiff, an African-American, filed suit against defendants after her application to lease a space for her hair salon was denied. Plaintiff alleged that the denial infringed her right to freedom from racial discrimination in the making of a contract. The district court granted summary judgment for defendants. The court affirmed the district court's alternative conclusion that plaintiff failed to rebut the legitimate, nondiscriminatory reasons defendants proffered for denying her lease application. Defendants' reasons included: odors emanating from the salon would disturb the residential tenants on the upper floors; plaintiff's business would not survive given the number of other salons in the area; a salon would not generate cross-shopping with other commercial tenants; plaintiff's credit score was too low; and defendants would not break even given the high cost of building out the unit. View "Flournoy v. CML-GA WB, LLC" on Justia Law

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Plaintiff purchased a luxury yacht from Seller, the yacht was manufactured by Horizon and its wholly-owned subsidiary Premier in Taiwan, Horizon and Premier are Taiwanese companies, and Seller is an independent U.S. corporation based in Florida. Plaintiff filed suit, alleging ten claims related to the purchase of the yacht. The district court entered summary judgment for defendants on all but two claims: the breach of express warranty claims against Horizon and Premier; entered summary judgment for Seller on its counterclaim to foreclose on the promissory note; and certified the judgment as a partial final judgment for interlocutory review. On appeal, plaintiff challenged the entry of summary judgment as to: (1) the fraudulent inducement claims against all three defendants (Count I); (2) the breach of implied warranty claims against all three defendants (Counts III, IV, and VII); and (3) the breach of express warranty claim against Seller, Horizon Yachts, Inc. (Count VIII). The court vacated the district court's grant of summary judgment as to Counts I, III, IV, VII, and VIII and remanded for trial; affirmed the grant of summary judgment as to the remaining claims; and reversed the district court's grant of summary judgment on defendants' counterclaim. View "Global Quest v. Horizon Yachts" on Justia Law