Justia Iowa Supreme Court Opinion Summaries

This case involved a dispute over a change in hauling fees paid by a dairy cooperative to an independent contractor who transported milk from farms to the cooperative’s facilities. When the co-op notified the hauler that it would be phasing out a trip fee it had been paying the hauler, the hauler objected but continued to transport milk. Thereafter, the co-op paid the agreed hauling rate without the trip fees. Several months later, the hauler sued the co-op for unpaid trip fees. The co-op, in turn, declared the contract terminated. The district court granted summary judgment for the co-op, concluding that the change in payment terms was a new offer that the hauler accepted by performance. The court of appeals reversed, concluding that summary judgment was inappropriate where questions of fact existed as to acceptance. The Supreme Court vacated the decision of the court of appeals and affirmed the district court’s summary judgment, holding that, under the parties’ oral contract, the co-op could alter payment terms prospectively upon reasonable notice, and the hauler accepted the new terms by performance, notwithstanding its protests. View "Johnson v. Associated Milk Producers, Inc." on Justia Law

Plaintiff filed a class action petition against J.C. Penney asserting that the internet retailer unlawfully charged Iowa sales tax on shipping and handling charges. J.C. Penney forwarded the tax to the Iowa Department of Revenue (IDOR) pursuant to the Iowa version of the Streamlined Sales and Use Tax Act (SSUTA). The district court granted summary judgment in favor of J.C. Penney. The Supreme Court affirmed, holding (1) the district court correctly granted J.C. Penney’s motion for summary judgment on Plaintiff’s statutory claims grounded in SSUTA, as the SSUTA does not create a private cause of action; (2) the district court did not err in granting summary judgment on Plaintiff’s claims related to the alleged unlawful payment of taxes on the ground that the remedies under Iowa Code 423.45(3) and 423.47 are exclusive remedies barring other claims for relief for wrongful payment of taxes under SSUTA; and (3) Plaintiff was not entitled to recover on her claims alleging shipping and handling misrepresentations. View "Bass v. J.C. Penney Co., Inc." on Justia Law

Developers and a general contractor of an apartment complex purchased a primary commercial general liability (CGL) insurance policy from Arch Insurance Group and an excess CGL insurance policy from National Surety Corporation (NSC). Westlake Investments, LLC, which purchased the complex, sued the insureds for construction defects. Arch defended the suit on behalf of the insureds, and the parties eventually settled. Pursuant to the settlement agreement, the insureds assigned their claims against NSC on the excess CGL policy to Westlake. Thereafter, NSC initiated this declaratory judgment action seeking a declaration that it had no obligation to pay any portion of the judgment awarded to Westlake. Westlake counterclaimed for breach of contract. The district court granted partial summary judgment in favor of Westlake, concluding that property damage resulting from defective work performed by an insured’s subcontractor may constitute an accident that qualifies as an occurrence covered by the Arch policy, and therefore, the NSC policy. After a trial, the jury returned a verdict in favor of Westlake. The Supreme Court affirmed in part and reversed in part, holding that defective workmanship by an insured’s subcontractor may constitute an occurrence under the terms of the Arch policy incorporated by reference into the NSC policy. View "Nat’l Surety Corp. v. Westlake Invs., LLC" on Justia Law

An aviation company challenged the application of a statutory immunity provision to its claim of a breach of the implied warranty of merchantability found in the Uniform Commercial Code (UCC) arising from an alleged defect in product design or manufacturing. The issue this appeal presented for the Supreme Court's review was whether the immunity provision only applied in tort cases or if it also applied to contracts. The Court held the statutory immunity only applied in products liability cases involving personal injury or property damage, not in cases based solely on economic loss. View "Des Moines Flying Service, Inc. v. Aerial Services, Inc." on Justia Law

Plaintiff, an agricultural supply company, was delivering its own products in a semi-trailer when the semi-trailer wrecked and spilled fertilizers and chemicals, contaminating several hundred cubic yards of soil. Plaintiff suffered a loss of almost $1 million due to the environmental remediation and for the value of the trailer and its contents. Plaintiff had been leasing the semi-tractor and its driver from another source at the time of the accident. Plaintiff, on behalf of itself and its insurer, filed suit against the lessors and their driver, alleging negligence and breach of contract. The district court granted summary judgment in favor of Defendants, concluding that the terms of the lease and Iowa Code 325B.1 barred any recovery by Plaintiff. The Supreme Court reversed, holding (1) section 325B.1 governs relations between authorized motor carriers and shippers and does not apply to the lease in this dispute because Plaintiff is a private carrier rather than a motor carrier; (2) the indemnification provisions in the lease are valid and enforceable; and (3) the anti-subrogation rule limits potential recovery in this case. View "United Suppliers, Inc. v. Hanson" on Justia Law

The Regional Utility Service Systems Commission (RUSS) brought a breach of contract action against the City of Mount Union. The district court entered judgment in favor of RUSS. The clerk of court subsequently issued a writ of general execution commanding the county sheriff to levy on all bank accounts held by the City at Iowa State Bank in Mount Union. The City filed a motion to quash the garnishment on the grounds that the bank account was exempt from execution under Iowa Code 627.18. The district court denied the motion to quash and claim of exemption. The Supreme Court reversed, holding that the bank account was exempt under section 627.18 because the general funds in the account were “necessary and proper for carrying out the general purpose” for which the City was organized. View "Reg’l Util. Serv. Sys. v. City of Mount Union" on Justia Law

A fire severely damaged a restaurant that was owned by Plaintiffs. Plaintiffs made a claim to Defendant, the insurer of the restaurant, but Defendant denied the majority of the claim. Plaintiffs filed a breach-of-contract action against Defendant to recover under the insurance policy. A jury returned a verdict for Plaintiffs in the amount of $236,902. Defendant paid this amount plus interest and costs. Three months after judgment was entered, Plaintiffs filed this action against Defendant for “bad faith,” alleging that Defendant lacked an objectively reasonable basis for denying the claim. The district court granted Defendant’s motion for summary judgment, finding that the bad-faith action was barred by claim preclusion. The court of appeals reversed. The Supreme Court vacated the judgment of the court of appeals and affirmed the district court’s grant of summary judgment to Defendant, holding that, under the circumstances of this case, the final judgment in the breach-of-contract suit barred the later tort action for bad faith. View "Villarreal v. United Fire & Cas. Co." on Justia Law

Patron won 185 credits, or $1.85, while playing a penny slot machine at a Casino. However, at the same time, a message appeared on the screen stating, “Bonus Award - $41797550.16.” The Casino refused to pay the alleged bonus, claiming that the slot machine game malfunctioned, and therefore, the bonus award displayed on the screen was not valid. The Patron filed suit against the Casino, asserting breach of contract, estoppel, and consumer fraud. The district court granted summary judgment to the Casino on all three counts. The Supreme Court affirmed, holding (1) the rules of the game formed a contract between the Patron and the Casino, and the Patron was not entitled to the bonus under those rules; (2) the Patron failed to prove the necessary elements of either promissory or equitable estoppel; and (3) the Patron failed to present proof of an ascertainable loss sufficient to warrant recovery on her consumer fraud claim. View "McKee v. Isle of Capri Casinos, Inc." on Justia Law

The Iowa Department of Economic Development (IDED) and Ghost Player, LLC executed a contract for tax credits under which Ghost Player believed it would receive certain tax credits for a documentary film it produced. CH Investors, LLC was a third-party beneficiary to the contract. The IDED declined to issue the contracted tax credit for some of the investments and expenditures of Ghost Player. Ghost Player and CH Investors subsequently filed a breach of contract action against the IDED. The district court dismissed the action on the grounds that Ghost Player failed to exhaust its remedies under the Iowa Administrative Procedure Act. The Supreme Court affirmed, holding that the district court (1) was without authority to hear the case because the IDED actions in this case required Ghost Player to exhaust its administrative remedies prior to filing a case in district court; and (2) correctly found the process used by the IDED in processing the claim did not offend due process principles under the State or the Federal Constitutions. View "Ghost Player, LLC v. State" on Justia Law

This case involved three small school districts, Northeast Community School District, East Central Community School District, and Preston Community School District. In 2010, the school boards of Northeast and East Central entered into a whole grade sharing agreement. Thereafter, citizens from Preston and East Central voted to reorganize their districts and merge the districts together into a new school district called Easton Valley Community School District (Easton). The Easton school board subsequently sent a notification of cancellation of the agreement to the superintendent of Northeast, claiming that when East Central ceased to exist the agreement was null. Northeast filed a petition for declaratory action and mandamus and then amended its petition alleging repudiation of the agreement. The district court granted summary judgment for Easton, concluding (1) the agreement and the reorganization were valid but that the two were in direct conflict, and (2) the East Central school board did not have the ability to bind Easton as its successor corporation. The Supreme Court reversed, holding that the agreement could bind the reorganized school district. View "Northeast Cmty. Sch. Dist. v. Easton Valley Cmty. Sch. Dist." on Justia Law