Justia Massachusetts Supreme Court Opinion Summaries

Plaintiffs and Defendant, members of an accounting firm (Firm), were parties to a stockholder agreement (Agreement) that contained an arbitration clause. The parties’ agreement to arbitrate was governed by the Massachusetts Uniform Arbitration Act for Commercial Disputes. When Plaintiffs voted to require the withdrawal of Defendant as a director and stockholder in the Firm, Defendant opened his own accounting firm. The nature and terms of Defendant’s withdrawal from the Firm and his subsequent competition with the Firm were the bases of a dispute between the parties. The dispute was submitted to binding arbitration. The arbitrator issued a final award awarding the Firm $1.7 million plus interest. The superior court confirmed the arbitration award. Defendant appealed, arguing (1) the arbitrator fundamentally misinterpreted the agreement, and (2) he was entitled to have a court consider the merits of his claim because, in the arbitration clause of the agreement, the parties specifically provided for judicial review of an award to determine if there was flagrant error by the arbitrator. The Supreme Judicial Court affirmed the motion judge’s confirmation award, holding (1) the grounds of judicial review in this case were limited to those delineated in Mass. Gen. Laws ch. 215, 12 and 13; and (2) Defendant’s claim was not reviewable by the Court. View "Katz, Nannis & Solomon, P.C. v. Levine" on Justia Law

Plaintiff, a black male of African descent who had a medical degree from the University of the West Indies, was terminated from his employment with Mount Auburn Hospital while completing the first year of his residency. Plaintiff filed a ten-count complaint against the Hospital and three physicians who supervised his work, asserting employment discrimination and breach of contract, among other claims. The Appeals Court reversed as to the discrimination and breach of contract claims. The Supreme Judicial Court vacated the judgments in favor of Defendants on Plaintiff’s claims for employment discrimination and breach of contract, holding that Defendants were not entitled to summary judgment and that Plaintiff presented sufficient evidence to allow a jury to hear his claims. View "Bulwer v. Mount Auburn Hospital" on Justia Law

EventMonitor, Inc. terminated the employment of Anthony Leness, characterizing the termination as “without cause.” After discovering that Leness had copies the data on a company laptop computer EventMonitor retroactively characterized the termination as having been for cause and stopped paying Leness any severance payments. EventMonitor filed suit against Leness, alleging breach of contract, breach of the covenant of good faith and fair dealing, and breach of fiduciary duty. Leness counterclaimed for breach of contract, breach of the covenant of good faith and fair dealing, and violations of the Wage Act. A superior court judge entered judgment for Leness on EventMonitor’s claims and Leness’s counterclaims, finding that Leness had not engaged in defalcation of EventMonitor’s assets and had not committed a material breach of the employment contract, and thus that his termination could not have been for cause. The Supreme Judicial Court affirmed, holding (1) the trial judge correctly found that Leness did not commit a material breach of the employment contract and did not engage in defalcation of company assets, and therefore, Leness committed no act giving rise to a termination for cause; and (2) the trial judge correctly concluded that Leness was entitled to severance payments under the terms of the contract. View "EventMonitor, Inc. v. Leness" on Justia Law

Vittorio and Lydia Gentile were policyholders under a Massachusetts automobile insurance policy issued by Commerce Insurance Company. Their grandson, Vittorio Gentile, Jr. (Junior), an “excluded operator” under the policy, was operating one of the Gentiles’ vehicles covered by the policy when he caused an accident that injured Douglas and Joseph Homsis. Commerce filed this action seeking a declaratory judgment that the Gentiles’ violation of the operator exclusion form relieved it of the duty to pay the Homsises under the optional bodily injury provisions of the insurance contract. A superior court judge concluded that Commerce was relieved of its duty to pay the optional coverage for the Homsis’ injures because the Gentiles had violated their duty of “continuing representation” as to whether Junior was, in fact, operating their vehicles. The Appeals Court affirmed both on that basis and on the basis that the Gentiles had breached the insurance contract. The Supreme Judicial Court affirmed on the ground that, by allowing Junior to operate their vehicle, the Gentiles committed a breach of a material term of the insurance contract. View "Commerce Ins. Co., Inc. v. Gentile" on Justia Law

Joseph and Janice Boyle sued C&N Corporation. C&N held an insurance policy issued by Zurich American Insurance Company requiring that C&N provide notice to Zurich of any lawsuit brought against it. C&N did not notify Zurich about the lawsuit, but the Boyles’ counsel did. Zurich did not defend against the suit. Judgement by default was entered for the Boyles. The Boyles then sued Zurich, asserting the claims of C&N, which had assigned to the Boyles. A superior court judge ruled that Zurich breached its contractual duty to defend C&N. The Supreme Judicial Court affirmed in part and reversed in part, holding (1) an insured’s failure to comply with a notice obligation in an insurance policy does not relieve the insurer of its duties under the policy unless the insurer demonstrates that it suffered prejudice as a result of the breach; and (2) the superior court judge did not err in determining that Zurich committed a breach of its contractual duty to defend C&N, as Zurich failed to show that it was prejudiced as a result of C&N’s failure to comply with the policy’s notice obligation in this case. View "Boyle v. Zurich Am. Ins. Co." on Justia Law

The Division of Capital Asset Management and Maintenance (DCAM), the owner of a construction project, entered into a contract with a designer to prepare the project’s designs. DCAM contracted with Gilbane Building Company to be the construction manager at risk (CMAR). Gilbane subcontracted with Coghlin Electrical Contractors, Inc. to perform electrical work. Coghlin later filed a complaint against Gilbane alleging that Gilbane breached the subcontract by causing Coghlin to incur additional costs resulting from design errors. Gilbane filed a third-party complaint against DCAM, asserting that DCAM breached its contract with Gilbane by refusing to pay Gilbane the amounts claimed by Coghlin. The trial court allowed DCAM’s motion to dismiss the third-party complaint. The Supreme Judicial Court vacated the superior court’s judgment, holding (1) a public owner of a construction management at risk project gives an implied warranty regarding the designer’s plans and specifications, but the scope of liability arising from that implied warranty is limited; (2) the construction management at risk contract in this case did not disclaim the implied warranty; and (3) the contract's indemnification provision did not prohibit Gilbane from filing a third-party complaint against DCAM seeking reimbursement of additional costs under the implied warranty for damages claimed by Coghlin caused by an insufficient or defective design. Remanded View "Coghlin Elec. Contractors, Inc. v. Gilbane Bldg. Co." on Justia Law

A franchisee janitorial worker, on behalf of himself and other similarly situated individuals, filed a complaint against System4 LLC, a master franchisor, and NECCS, Inc., a regional subfranchisor, alleging, among other claims, breach of contract, misclassification as independent contractors in their franchise agreements, and rescission of the franchise agreements. The franchise agreements, signed only by Plaintiffs and NEECS, required the franchisees to arbitrate virtually all disputes. Defendants, citing the arbitration clause in the franchise agreement, moved to stay the court proceedings pending arbitration. The judge concluded that because System4 was not a nonsignatory to the agreements, Plaintiffs could proceed to litigate their claims against System4 in court. The Supreme Judicial Court reversed, holding that, by reason of equitable estoppel, System4 could compel Plaintiffs to arbitrate their substantive claims in accordance with the arbitration provision in Plaintiffs’ franchise agreements. Remanded. View "Machado v. System4 LLC" on Justia Law

The town of Yarmouth entered into a transportation contract with the Bay Colony Railroad Corporation whereby Bay Colony was to transport solid waste from the town’s waste transfer station to a facility in Rochester. The town later notified Bay Colony that it would terminate Bay Colony’s lease of certain rail lines, which meant that Bay Colony would no longer be able to transport the town’s waste by rail. A provision in the contract provided that, in the event the lease of the rail line was terminated, the town would permit Bay Colony to continue to transport the waste by “other modes of transportation.” Bay Colony notified the town that it would continue to transport waste by truck rather than rail. The town, however, began transporting its waste with the railroad operating company that was awarded the rail lease. A jury found that the town had committed a breach of the contract. The Supreme Judicial Court affirmed, holding (1) the town’s affirmative defense that it was barred by Mass. Gen. Laws ch. 160, 70A from allowing Bay Colony to transport its waste by truck failed as a matter of law; (2) a permit issued to the town by the Department of Environmental Protection did not render Bay Colony legally unable to perform the contract after it lost its rail lease; and (3) the contract remained in effect at the time of the town’s breach. View "Bay Colony R.R. Corp. v. Town of Yarmouth" on Justia Law

Plaintiff sued its Insurer, alleging breach of contract and seeking declaratory relief, after the Insurer refused to defend or indemnify Plaintiff in connection with an environmental dispute. A superior court allowed Plaintiff’s motion for partial summary judgment on the Insurer’s duty to defend. Plaintiff then amended its complaint to assert a claim under Mass. Gen. Laws ch. 93A, 11 arising out of the Insurer’s duty to defend. Thereafter, Plaintiff subsequently accepted reimbursement from the Insurer for its expenses in litigating and resolving the environmental matter. Insurer then sought summary judgment on the chapter 93A claim, arguing that its reimbursement of Plaintiff’s expenses precluded a finding that Plaintiff had suffered a loss of money or property, as required to establish a violation of chapter 93A section 11. The trial court denied summary judgment on the chapter 93A claim. The Supreme Judicial Court affirmed, holding (1) chapter 93A does not require a showing of uncompensated loss or a prior judgment establishing the amount of damages as a prerequisite to recovery; and (2) therefore, neither Plaintiff’s acceptance of full reimbursement of its expenses nor the absence of a judgment establishing contract damages precluded Plaintiff from pursuing a claim under chapter 93A. View "Auto Flat Car Crushers, Inc. v. Hanover Ins. Co." on Justia Law

Plaintiff purchased a new vehicle from Dealer that was subject to Manufacturer’s limited warranty. Plaintiff later filed a complaint against Manufacturer and Dealer (together, Defendants), alleging that the vehicle was defective and that Defendants failed to repair or remedy the defects under the warranty. Dealer demanded that Manufacturer reimburse Dealer for the attorney’s fees it incurred in defending against Plaintiff’s claims and indemnification for and liability incurred. Plaintiffs claims against Defendants were disposed of through summary judgment and voluntary dismissal. The judge also found that Dealer was not entitled to indemnificationt. The Supreme Judicial Court affirmed, holding that because Plaintiff’s allegations alleged the fault or negligence of both Manufacturer and Dealer, Manufacturer did not have a duty to defend under Mass. Gen. Laws ch. 93B, 8(a).View "Ferreira v. Chrysler Group LLC" on Justia Law