Justia Vermont Supreme Court Opinion Summaries

Defendant Junior's Pizza, Inc. appealed a superior court decision that confirmed an arbitration award and awarded attorney's fees to Plaintiff UniFirst Corporation. The Superior Court held that Junior's waived its right to object to arbitration by failing to challenge the award within thirty days of receiving notice. In June 2009, pursuant to the arbitration clause in the parties' contracts, UniFirst filed a demand for final and binding arbitration. Junior's declined to submit to arbitration, stating that it would reconsider if UniFirst produced a valid agreement. UniFirst subsequently provided copies of the contract provision to both Junior's and the arbitrator. In July 2009, the arbitrator notified the parties that UniFirst had met all filing requirements and arbitration would proceed absent a court order staying the matter. Junior's never sought a court order staying arbitration. UniFirst did not seek a court order compelling Junior's to participate. Notice of the arbitration hearing was provided to both parties, and the hearing took place. Junior's did not participate. UniFirst was awarded damages and attorney's fees, and Junior's was ordered to reimburse UniFirst in administrative fees associated with conducting the arbitration. The next day, the arbitrator notified Junior's of the award by email and certified mail. On appeal to the Supreme Court, Junior's argued (1) it did not waive its right to object to the arbitration award, (2) UniFirst was required to petition to compel arbitration prior to engaging in arbitration without Junior’s participation, and (3) the arbitration was not conducted in strict accordance with the terms of the contracts. Finding no error, the Supreme Court affirmed the arbitration award. View "UniFirst Corp. v. Junior's Pizza, Inc." on Justia Law

Plaintiffs James and Heidi Glassford, who brought suit to obtain compensation for an allegedly negligent home inspection, appealed a superior court’s order granting summary judgment in favor of home inspector Defendants The BrickKicker and GDM Home Services, Inc. (a franchisee of BrickKicker) based on the terms of a binding arbitration agreement in the parties' contract. In this appeal, the issue before the Supreme Court was whether the superior court erred in rejecting Plaintiffs' contention that the terms of the home inspection contract were unconscionable under the common law and unfair and deceptive under Vermont’s Consumer Fraud Act (CFA). Upon review of the contract in question, as well as the superior court record, the Supreme Court found the contractual provisions limiting liability to the cost of the inspection and yet requiring arbitration that would necessarily cost more than the amount of the liability limit unconscionable. Accordingly, the Court reversed the superior court’s decision and remanded the matter for further proceedings. View "Glassford v. BrickKicker" on Justia Law

Defendant AT&T Mobility, LLC appealed a trial court’s denial of its motion to compel arbitration. AT&T claimed the trial court erred by ruling that AT&T had not been assigned Plaintiff Pike Porter’s cell phone contract before sending him unsolicited text messages and erred in failing to hold an evidentiary hearing on this issue. AT&T also argued that even if Plaintiff's claims arose before AT&T purchased his contract, the trial court erred as a matter of law in holding that AT&T cannot enforce the binding arbitration agreement in Plaintiff's original cell phone contract. The court also noted that the arbitration agreement could not bind Plaintiff "with regard to events between him and AT&T that took place at a time when his only contract was with Unicel, not AT&T." AT&T highlighted four pieces of evidence it submitted along with its motion to amend and reconsider as "undisputed" proof that it purchased Plaintiff's contract in December 2008. Upon review of AT&T's evidence, the Supreme Court concluded the document did not establish that Plaintiff's contract was one of the 100,000 to 150,000 contracts sold, nor did it suggest that "certain Unicel assets" included all of the wireless contracts Unicel held in Vermont. Accordingly, the Court affirmed the trial court's decision in favor of Plaintiff. View "Porter v. AT&T Mobility, LLC" on Justia Law

Defendant Applejack Art Partners, Inc., appealed a trial court enforcing an arbitration award and entered judgment in Plaintiff Albert Stephens, III's favor for $1,538,164.50 plus interest. Plaintiff began working with the company in September 2006 and subsequently invested $1,125,000 in the company in exchange for stock shares.  In April 2008, Applejack terminated plaintiff's employment.  Plaintiff filed suit against Defendants Applejack, Jack P. Appelman, Aaron S. Young, and William Colvin (collectively, Applejack) and Applejack counterclaimed.  Applejack also sought an order enforcing its right to repurchase Plaintiff's stock.  The parties engaged in binding arbitration and following four days of evidentiary hearings, the arbitrator issued his decision.  He found that in October 2006, plaintiff executed an employment contract, stock purchase agreement, and shareholders' agreement.  Pursuant to the stockholder's agreement, the executive stockholders had the right to buy out plaintiff's shares in the event that plaintiff's employment was terminated.  The agreement identified a specific formula for valuing the stock shares and allowed for Applejack to either pay for the stock in full or provide a 10% down payment and a promissory note for payment of the balance in three equal annual installments, plus interest. Plaintiff refused to sell his stock, in part because he misunderstood the terms of the stock purchase agreement.  An arbitrator concluded that Applejack had the right to buy the shares, and it ordered Plaintiff to transfer his stock into an escrow account, pending full performance of all payment obligations. Applejack did not meet its obligation on the first payment and Plaintiff brought an enforcement action.  Plaintiff sought both a judgment confirming the arbitration award as well as an immediate judgment for all amounts awarded by the arbitrator due to Applejack's default.  The court granted Plaintiff's request.  It found that Applejack's default went to the essence of the arbitrator's award and that Applejack could not now resort to the terms of the promissory note to delay its payments. Applejack argued on appeal that the court should have remanded this case to the arbitrator for clarification, although it was not clear what part of the award Applejack believed was ambiguous.  Applejack also suggested (apparently for the first time on appeal) that notwithstanding the arbitrator's decision Plaintiff should simply keep the stock shares because Applejack was unable to pay for them.  Finally, Applejack asserted that the court erred in ordering full payment of the award suggesting that by doing so, the court modified the arbitration award under Vermont Rule of Civil Procedure 60(b) without authority to do so.  It also argued that there was no clear basis for accelerating the payments due. Upon review of the arbitration record and the applicable legal authority, the Supreme Court found no abuse of discretion by the trial court nor from the arbitration proceedings and affirmed the decision against Applejack: [t]he court imposed an appropriate remedy for Applejack's default, and there was no error." View "Stephens III v. Applejack Art Partners, Inc." on Justia Law