Justia Kansas Supreme Court Opinion Summaries

Articles Posted in Contracts

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Nationwide Mutual Insurance Company issued an automobile insurance policy, which included uninsured motorist coverage, to Melvin Briggs. After Nationwide sent Briggs a notice of nonrenewal of the policy, Briggs was involved in a collision with an uninsured motorist. Briggs's children filed a claim under the Nationwide policy for uninsured motorist benefits, which Nationwide denied. Nationwide subsequently sued Briggs’s children, seeking a declaratory judgment that it had nonrenewed Briggs’s policy before the automobile accident. The U.S. district court granted summary judgment for Nationwide, concluding that it had complied with statutory and policy requirements for notice of nonrenewal. On appeal, the Tenth Circuit Court of Appeals certified a question of law to the Kansas Supreme Court, which answered the certified question as follows: Notice to nonrenew an insurance policy that complies with the procedure set out in Kan. Stat. Ann. 40-3118(b) and a consistent provision in the policy itself is sufficient to force a lapse of coverage, regardless of whether a proper substantive basis for nonrenewal exists under Kan. Stat. Ann. 40-276a(a) and consistent policy language. View "Nationwide Mut. Ins. Co. v. Briggs" on Justia Law

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Iron Mound, LLC and ASC Group, LLC entered into an operating agreement for the creation of ASC Midwest, LLC. Neuterra Healthcare Management, LLC was the successor-in-interest to the ASC Group. After ASC Midwest was dissolved, Iron Mound brought this breach of contract action against Nueterra, alleging that under the operating agreement, Iron Mound was entitled to receive a percentage of the gross fees earned by Nueterra under a management agreement entered into after the operating agreement had expired. The district court granted summary judgment in favor of Nueterra. The court of appeals reversed. The Supreme Court reversed the court of appeals and affirmed the district court, holding that the unambiguous terms of the operating agreement rendered it inapplicable to the fees received by Nueterra under the management agreement. View "Iron Mound, LLC v. Nueterra Healthcare Mgmt., LLC" on Justia Law

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Thoroughbred Associates drilled a gas well (Well) in Comanche County. Thoroughbred subsequently acquired leases of land near the Well and created a unit called the Thoroughbred-Rietzke Unit (Rietzke Unit). Defendants became successors-in-interest to a lease (OXY Lease) Thoroughbred entered into for oil and gas underlying a tract near the Well. The parties disagreed, however, about whether the Well was draining the Rietzke Unit. Thoroughbred stopped submitting royalty payments to Defendants accruing from the Rietzke Unit. Thoroughbred subsequently filed a complaint for a declaratory judgment that it had been mistaken when it included the OXY Lease in the Rietzke Unit. Defendants counterclaimed. The district court concluded (1) Defendants failed to prove that any drainage of the leased lands occurred; and (2) the Lease was properly included in the Rietzke Unit. The Supreme Court affirmed in part and reversed in part, holding (1) Defendants failed to prove their drainage claim; and (2) the court of appeals erroneously granted summary judgment to Defendants on their claim that the Lease should be included in the Rietzke Unit. View "Thoroughbred Assocs., LLC v. Kansas City Royalty Co., LLC " on Justia Law

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The Rineharts contracted with Morton Buildings for a preengineered building to serve as their personal residence and business location for their business, Midwest Slitting. Upon disputes regarding the structure's quality, the Rineharts and Midwest Slitting sued. A jury found for the Rineharts on several of their claims and for Midwest Slitting on its negligent misrepresentation claim. The court of appeals affirmed and granted the Rineharts appellate attorney fees. Morton appealed, arguing that the economic loss doctrine, which originated with product liability litigation to prohibit tort claims when the only damages were to the product itself, should extend to bar the negligent misrepresentation claim in this case. The Supreme Court (1) affirmed the judgment in favor of Midwest Slitting on its negligent misrepresentation claims, holding that the economic loss doctrine does not bar negligent misrepresentation claims because the duty at issue arises by operation of law, and the doctrine's purposes would not be further by extending it to such claims; and (2) reversed the appellate attorney fee award because the Court could not determine from the record whether the court of appeals included time and expenses in the award not reimbursable under the applicable statute. Remanded. View "Rinehart v. Morton Bldgs., Inc." on Justia Law

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Rick and Lisa Graham filed a petition for a protection from stalking order against Elizabeth Jones in 2006. Jones counterclaimed for breach of fiduciary duty, breach of contract, fraud, and conversion. On June 27, 2007, while her counterclaims against the Grahams were pending, Jones died. On April 17, 2008, the Grahams filed a motion to dismiss the lawsuit. Angela Herring, who was appointed as administratrix of Jones's estate, filed a motion to substitute the estate as the claimant against the Grahams. The district court dismissed the action based upon its determination that substitution was untimely under Kan. Stat. Ann. 60-225(a)(1). The court of appeals reversed. The Supreme Court affirmed and provided an analysis to determine whether a substitution motion was filed within a reasonable time, holding (1) the relevant time period for determining the reasonableness of a delay in substituting a party begins with the statement noting the death and ends with the filing of the motion for substitution; and (2) the standard for determining whether a substitution motion has been made within a reasonable time is to consider the totality of the circumstances, which can include the fact of whether another party would be prejudiced by the substitution. Remanded. View "Graham v. Herring" on Justia Law

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Plaintiff brought a retaliatory discharge claim against her former employer (FedEx), alleging that she was terminated for exercising her rights as an injured worker pursuant to the Kansas Workers Compensation Act. Plaintiff filed her suit fifteen months after she was fired. FedEx responded by claiming that, while Kansas law provides a two-year statute of limitations of Plaintiff's claim, Plaintiff was bound by her employment contract to file her suit within six months of her termination. The federal district court granted summary judgment for FedEx. The federal court of appeals certified questions of Kansas law to the Kansas Supreme Court. The Supreme Court answered by holding that the private contract between FedEx and Plaintiff in this case violated public policy and was invalid to the extent it limited the applicable statute of limitations for filing a retaliatory discharge claim based on Plaintiff's exercise of her rights under the Workers Compensation Act. View "Pfeifer v. Federal Express Corp." on Justia Law

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Plaintiff filed a claim with his Insurer under his policy for stolen tools and equipment, which Insurer denied. Plaintiff sued. The district court granted summary judgment for Insurer. The court of appeals reversed and remanded for entry of judgment for Plaintiff. On remand, Plaintiff requested and received attorney fees related to both the district court and the appellate proceedings. The court of appeals reversed the award of appellate attorney fees, concluding Plaintiff had waived his right to appellate fees by not filing a motion for attorney fees with the court of appeals in the prior appeal. Petitioner filed a motion requesting appellate attorney fees for his second appeal in Snider II. The court of appeals awarded additional appellate attorney fees. Plaintiff appealed, requesting a judgment for the appellate attorney fees incurred in Snider I and an award of additional fees for the appeal in Snider II. The Supreme Court affirmed, holding that the court of appeals (1) correctly applied Supreme Court Rule 7.07(b), Evans v. Provident Life & Accident Ins. Co., and Kan. Stat. Ann. 40-908; and (2) did not err in determining the amount of reasonable attorney fees related this current appeal. View "Snider v. Am. Family Mut. Ins. Co." on Justia Law

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Seller and his real estate agent (Agent) entered into an agency agreement requiring Agent to inform potential buyers of material defects in Seller's home of which she had actual knowledge. Seller completed a signed a seller's disclosure form. After Buyers purchased the home, Buyers filed this lawsuit against Seller, Agent, and Agent's brokerage firm (Firm), alleging, inter alia, fraud, negligent misrepresentation for providing false representations in the disclosure form, breach of contract, and violations of the Kansas Consumer Protection Act (KCPA). The district court granted summary judgment for Defendants on all claims. The court of appeals reversed the district court's summary judgment in favor of Seller and affirmed summary judgment in favor of Agent and Firm. The Supreme Court affirmed in part and reversed in part, holding that the district court (1) erred in granting summary judgment to Seller on Buyers' fraudulent inducement, fraud by silence, negligent misrepresentation, and breach of contract claims; and (2) erred in granting summary judgment to Agent and Firm for Buyers' negligent misrepresentation and KCPA claims. Remanded. View "Stechschulte v. Jennings" on Justia Law

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This appeal arose over the administration of a Trust between Lawrence, the Trust's beneficiary, and the Trust's trustees, Dennis and Leona (collectively, Trustees). Lawrence moved to set aside a contract for deed executed between Dennis and his wife and the Trustees for the sale of farmland owned by the Trust and also sought to remove the Trustees, alleging they engaged in self-dealing and breached their fiduciary duties. The district court concluded (1) the Trust permitted the Trustees to finance the sale of the farmland to Dennis under the terms set forth in the contract for deed; and (2) Lawrence violated the Trust's no-contest clause by challenging the Trustee's sale of the farmland to Dennis, which required Lawrence's disinheritance. The Supreme Court reversed the district court's ruling regarding the Trustees' authority to finance the sale of the farm and its enforcement of the no-contest clause against Lawrence, holding (1) the Trustees' execution of the contract for deed violated the terms of the Trust; and (2) Lawrence had probable cause to challenge the Trustees' sale of the farm to Dennis. Remanded. View "Hamel v. Hamel" on Justia Law

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Defendant Ritchie Corporation conveyed title to a tract of land a waste systems corporation (BFI). Ritchie and BFI entered into an escrow agreement that entitled BFI to operate the property as a nonhazardous waste transfer station for thirty-five years. Ritchie granted BFI a right of first refusal to buy the transfer station from Ritchie. BFI later assigned its title and interest in the escrow agreement to Plaintiff Waste Connections, which began operating the transfer station. Later, a third party agreed to buy the transfer station and an adjoining landfill. Waste Connections asserted its right of first refusal to purchase the transfer station. Waste Connections and Ritchie subsequently disputed the proper price owed under the escrow agreement - $1.45 million or $2 million. The district court entered summary judgment in favor of Ritchie. The court of appeals reversed. The Supreme Court reversed, holding that because genuine issues of material fact remained on Waste Connections' breach of contract action against Ritchie, summary judgment for either party was inappropriate. View "Waste Connections of Kan., Inc. v. Ritchie Corp." on Justia Law