Justia Vermont Supreme Court Opinion Summaries

In 2006, Defendants Tristan Vaughan and Grace Zambon purchased all outstanding shares of defendant Northland Specialties, Inc., from Plaintiffs Philip and Patricia Pierce.  Under the terms of the promissory note, Defendants would repay $30,000 in three installments, due annually on the first day of April. In 2007, Plaintiffs filed suit against Defendants.  The complaint alleged that Defendants had entered into two verbal agreements following the sale of the business whereby Defendants allegedly agreed to buy a specified list of materials and hardware for $20,000, with payments to be made over time as the materials were used.  The suit alleged Defendants had failed to make any payments under either of these verbal agreements and therefore owed Plaintiffs for breach of contract and damages.  The first payment of $10,000 came due on the promissory note.  Defendants were not able to make this payment on time, nor did they communicate with Plaintiffs regarding when the payment would be made. Three days later, Plaintiffs filed a motion for default judgment.  Grace Zambon prepared a response which was received by Plaintiffs' attorney but was not filed with the court. Plaintiffs' attorney allegedly "interpreted this documents [sic] as an offer to settle."  Despite the response, he moved forward with a motion for default judgment, which the superior court granted. Two months later, Plaintiffs filed a second suit against Vaughan and Zambon, this time to recover the balance of the purchase price under the original stock purchase agreement.  After exchanging settlement offers, the parties reached a settlement agreement.  Roughly three years later, Plaintiffs filed a motion for trustee process in order to collect on the default judgment entered in the first lawsuit.  Defendants filed a Rule 60(b) motion seeking relief from the default judgment.  In 2010, the superior court held a hearing on this motion and granted the relief from judgment as sought by Defendants.  In early 2011, the Supreme Court granted Plaintiffs permission to take an interlocutory appeal on the issue of whether the superior court erred in granting the 60(b) motion. More specifically, the issue was whether the court could grant the motion beyond the one-year limitations period for mistake or inadvertence when the parties had reached an agreement after the default judgment entered. The Supreme Court concluded that the superior court's grant of Defendants' 60(b) motion was in error, and reversed the lower court's decision. View "Pierce v. Vaughan" on Justia Law

The parties in this case separately appealed the trial court order that awarded damages in excess of $78,000 to Plaintiff SEC America (SEC). Defendant Marine Electric Systems, Inc. (MES) contended the court erred in: (1) failing to reduce the damage award for partial payment; (2) granting an award for lost profits; and (3) relying on inadmissible evidence. SEC asserts the court erred in concluding that it acted unreasonably in failing to mitigate damages. This case arose out of a transaction to supply an electrical component for installation in jamming devices to be used by NATO forces in Afghanistan to disrupt the remote detonation of improvised explosive devices (IEDs). MES placed an order for power converters for its devices. SEC made a partial shipment of the converters, and continued working on the remaining units. MES' contract with NATO had collapsed, and MES' customer who promised to purchase the completed jammers reneged on its promise. MES sued its client and ultimately reached a settlement. None of the proceeds from the settlement went to SEC. Subsequently SEC filed suit against MES for breach of contract. Following a bench trial, the court found in SEC's favor. MES appealed, and SEC filed a cross-appeal. MES argued on appeal to the Supreme Court that the trial court erred in arriving at the proper amount of damages owed to SEC. Finding "no clear error to compel reversal of the judgment," the Court affirmed the trial court. View "SEC America, LLC v. Marine Electric Systems, Inc." on Justia Law

Plaintiffs Thomas and Margaret McGoff appealed a superior court order that granted Defendant Acadia Insurance Company summary judgment with respect to Plaintiffs’ underinsured motorists (UIM) claim arising from an automobile accident in which Thomas McGoff was injured. Thomas McGoff was employed by A.R. Sandri, Inc., a Massachusetts corporation that operates gas stations and other businesses in New England and New York. At the time of the accident that led to the instant lawsuit, Sandri had supplied McGoff with a company car which he kept at his Barre, Vermont home. The Plymouth was owned by Sandri, registered in Massachusetts, and insured by Acadia. Sandri had two fleet insurance policies with Acadia—one for vehicles registered in Massachusetts and one for vehicles registered in other states. The Plymouth was covered by the policy issued for vehicles registered in Massachusetts. The policy listed the vehicles as being garaged in Massachusetts, apparently based on Sandri’s representation. McGoff made a claim against the other driver and a claim for additional UIM coverage against Acadia. Acadia denied coverage because the policy’s UIM coverage was less than the alleged tortfeasor’s liability coverage. Based on this, Acadia moved for summary judgment. In May 2010, the court granted Acadia’s motion, ruling that Vermont’s uninsured/underinsured (UM/UIM) insurance requirements do not apply to the Acadia fleet policy because the policy was not "delivered or issued for delivery in this state." Without setting forth "[a] statement of the issues presented for review," Plaintiffs generally claimed on appeal that the superior court erred by granting Acadia summary judgment. Specifically, Plaintiffs argued the court erred in ruling that Vermont’s UIM requirements do not apply to the instant policy on grounds that the policy was not delivered or issued for delivery in Vermont. Because the Plymouth was garaged in Vermont rather than in Massachusetts (as indicated in the Acadia policy), they maintained the vehicle should have been registered in Vermont rather than Massachusetts and the Vermont UIM requirements should apply. Upon review of the parties briefs and the trial record, the Supreme Court found that Plaintiffs' position was contrary to the plain language of the UIM statute as well as the nearly unanimous relevant case law, and therefore the Court decline to adopt it under the present circumstances. The Court affirmed the superior court's grant of summary judgment to the insurer. View "McGoff v. Acadia Insurance Co." 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

Landlord Downtown Barre Development appealed a trial court's denial of its request for declaratory relief. Landlord argued that Tenant GU Markets of Barre, LLC established a corporate structure that entitled it to terminate the parties' commercial lease.  Landlord claimed the trial court erred by not considering Tenant's conduct when deciding whether tenancy under the terms of their agreement could be terminated.  Upon review of the lease and the applicable legal authority, the Supreme Court concluded that the essence of Landlord's claim was for "anticipatory repudiation." Even assuming Landlord could rely on this common law principle, Tenant had not indicated to Landlord an intent to breach, nor did Tenant commit an act to render it "unable to perform." Accordingly, because the language of the lease was clear and unambiguous and Tenant's conduct did not constitute notice as required by the plain language of the lease, the Court affirmed the trial court's ruling that landlord was not entitled to terminate the agreement on this ground. View "Downtown Barre Development v. GU Markets of Barre, LLC" on Justia Law

Applicant Times and Seasons, LLC, appealed the Environmental Court's grant of summary judgment to the Natural Resources Board and the corresponding denial of Applicant's "Act 250" permit application to construct and operate a gift shop and deli with related improvements in the Town of Royalton. On appeal, Applicant argued that it could avail itself of the definition of "primary agricultural soils" in 10 V.S.A. 6001(15) as it was amended during the course of its litigation to secure compliance with the only Act 250 criterion for which it did not receive approval. Upon review of the legislative history of the applicable legal authority, the Supreme Court found that a reconsideration application is a continuation of an original Act 250 permit application. Accordingly, the submission of a reconsideration application is not a separate vesting event: "[c]ontrary to applicant's proposed interpretation, an applicant on reconsideration may not simultaneously take advantage of the laws in effect at the time of the initial application and those in effect at the time of the reconsideration application. It is not a two-way street." The Court affirmed the lower court's grant of summary judgment against Applicant. View "In re Times and Seasons, LLC" on Justia Law

Appellants Shenandoah, LLC, David Shlansky, Ting Chang, and other entities and individuals, appealed the Environmental Court's summary judgment decision upholding an "Act 250" jurisdictional opinion. Appellants have a variety of overlapping interests. Mr. Shlansky created an irrevocable trust (Trust) to benefit his and his wife Chang's children. As settler of the Trust, Mr. Shlansky contributed the property that is the subject of the underlying jurisdictional opinion. The Trust has an ownership stake in various companies that have engaged in land-development activities in the relevant jurisdictional area. Shenandoah, LLC, one such created entity, sought to build a ten-unit residential housing project. In August 2008, Shenandoah requested a jurisdictional opinion to determine if the project required an "Act 250" permit. In a September 2008 decision, the district coordinator found that the project required an Act 250 permit because it involved the construction of a housing project with ten or more units. Appellants appealed portions of this decision to the Environmental Court. The court upheld the district coordinator's jurisdictional opinion. The court concluded that Mr. Shlansky and Ms. Chang benefited from the Trust's land-development activities so the Trust's development activities were attributable to them personally. Appellants challenged this conclusion on appeal. As support for their position, they pointed to the affidavits filed by Mr. Shlansky, Ms. Chang and "the legal existence of the Trust, which is irrevocable." Upon review of the lower court record and the applicable legal authority, the Supreme Court affirmed the Environmental Court's decision. As the Environmental Court concluded, benefit to the parents rendered them "persons" affiliated with subdivisions and development previously undertaken by entities owned or affiliated with the Trust as defined by Act 250. View "In re Shenandoah LLC" on Justia Law