Recently in Contract Law Category

We'll never know if the Toones' claims were valid. Well, we have a pretty good idea, actually, thanks to the court's dicta on the matter, but we can't help but wonder if they would've had a chance to adduce additional evidence that would've supported their claims had they made it to discovery. Instead, their case becomes another reminder as to the importance of proper pleading and paperwork.

The Toones' mortgage, like many others in this historic recession, went into foreclosure. It was passed around between banks, like children playing "hot potato." They attempted to save their home through a "Home Affordable Modification Program Loan Trial Period (HAMP) Agreement and by suing every bank and lawyer that ever came into contact with the mortgage. The lawsuit was eventually transferred to federal court and dismissed via 12(b)(6).

Bennie Walters sued his former employer, Walmart, for employment discrimination. Walmart apparently reached an agreement with Walters during a settlement conference -- which is suprising since Walmart is kind of famous for its aggressive litigation strategy -- but Walters later refused to sign the written agreement.

The district court granted Walmart's motion to enforce the agreement, and denied Walters' motion for reconsideration. The Tenth Circuit Court of Appeals affirmed that decision.

It's not often that we come across a Tenth Circuit Court of Appeals case that is largely dedicated to the elements of a contract instead of precedent. Today's case, Sola Salon Studios v. Heller, is a rare exception.

Sola Salon owns salon studios throughout the country, but its operational structure is rather unusual. Sola does not employ beauticians or stylists, and instead contracts with those kinds of professionals to use space that Sola leases from someone else, and allows the professionals to operate their own independent salon studios.

The Tenth Circuit paraphrased Sola's motto as "the stylists are in business for themselves, but not by themselves."

We typically try to give you the highs and lows out of the Tenth Circuit Court of Appeals to lighten the load on your required reading list. Today, we’re recommending that you actually read at least a few pages of this escape clause insurance dispute because it is clear that Judge Neil Gorsuch had fun writing it.

Insurance disputes? Fun? How is that possible?

Maybe because it’s because the litigants are arguing over who should pay when a haunted house worker falls down an elevator shaft. (So ironic, it’s scary.)

Get ready for a flashback to first-year Contracts, with a modern twist.

The Tenth Circuit Court of Appeals ruled recently that a bank and a hospital had formed an enforceable contract regarding the sale of medical equipment in an offer-and-acceptance-based breach of contract dispute.

The Tenth Circuit Court of Appeals ordered the Department of Health and Human Services (HHS) this week to enter into a self-determination contract with the Southern Ute Indian Tribe in New Mexico for the operation of a tribe health center.

The Indian Self-Determination and Education Assistance Act (ISDA) directs the Secretary of HHS, upon request of an Indian tribe, to enter into a contract by which the tribe assumes direct operation of HHS’s federal Indian health care programs for the tribe’s members. Congress provided for these self-determination contracts in an effort to encourage self-government and enhance the progress of Native American people and their communities.

Action to Enjoin New Mexico From Regulating Alcohol on Flights

In US Airways, Inc. v. O'Donnell, No. 09-2271, an action in seeking to enjoin defendant New Mexico state officials from regulating, pursuant to the New Mexico Liquor Control Act (NMLCA), the alcoholic beverage service that airlines provided to passengers on flights, the court reversed summary judgment for defendants where New Mexico's regulatory scheme was impliedly preempted as it fell within the field of aviation safety that Congress intended federal law to occupy exclusively, but the Twenty-First Amendment required a balancing of New Mexico's core powers and the federal interests underlying the Federal Aviation Act.

In Izzo v. Wiley, No. 10-1195, a habeas petition challenging the decision of the Bureau of Prisons (BOP) denying petitioner's eligibility for the Elderly Offender Home Detention Pilot Program, the court affirmed the denial of the petition where the phrase "term of imprisonment to which the offender was sentenced" in 42 U.S.C. section 17541 unambiguously referred to the term imposed by the sentencing court, without any consideration of good time credit.

In Murphy v. Deloitte & Touche Grp. Ins. Plan, No. 09-2028, an action concerning defendant's denial of disability benefits under an ERISA plan, the court vacated summary judgment for defendant where 1) the court's case law prohibited courts from considering materials outside the administrative record where the extra-record materials sought to be introduced related to a claimant's eligibility for benefits; and 2) neither a claimant nor an administrator should be allowed to use discovery to engage in unnecessarily broad discovery that slows the efficient resolution of an ERISA claim.

In US v. Martinez, No. 09-2117, the court of appeals affirmed defendant's sentence for conspiring to defraud the State of New Mexico during the construction of the Bernalillo County Metropolitan Courthouse in Albuquerque, on the grounds that 1) the district court did not err in applying the 2008 version of the Sentencing Guidelines; 2) the district court properly refused to embark upon an "apples and oranges" comparison between the fraudulent proceeds defendant gained from this conspiracy and the contract revenues for services rendered that other co-conspirators previously gained from allegedly bribing an official; and 3) any disparity between defendant's and the official's identical terms of imprisonment was explained by their different plea agreements.

Cahill v. Am. Fam. Mut. Ins. Co., No. 09-1200, involved an action against an insurer asserting state-law causes of action arising out of defendant's alleged failure to comply with Colorado insurance law.  The Tenth Circuit affirmed summary judgment for defendant, on the ground that plaintiff was incorrect in asserting that the relevant limitations periods should have been tolled until defendant informed him that it had not paid benefits required by law.

In US v. Simpson, No. 09-4127, the court of appeals affirmed defendant's drug trafficking conviction, holding that the district court properly denied defendant's motion to suppress narcotics found in his vehicle, because defendant's prior criminal conviction for drug trafficking, his extreme nervousness, and the fact that he provided inconsistent and evasive answers to queries about his travel plans together provided reasonable suspicion to justify extending a legitimate traffic stop to allow further questioning and a canine sniff of his automobile.

Related Resources

• Full Text of US v. Martinez, No. 09-2117
• Full Text of Cahill v. Am. Fam. Mut. Ins. Co., No. 09-1200
• Full Text of US v. Simpson, No. 09-4127