Justia U.S. 8th Circuit Court of Appeals Opinion Summaries

The Weitz Company sued MacKenzie House and MH Metropolitan for breach of construction contract. Arrowhead and Concorde were third-party defendants. MH Metropolitan counterclaimed for breach of the same contract, seeking liquidated damages and the cost to complete the project. Arrowhead also counterclaimed. The jury returned a verdict for MH Metropolitan, Arrowhead, and Concorde on Weitz's claim. The district court denied post-judgment motions and Weitz appealed. The court held that there was a legally sufficient evidentiary basis for the jury's verdict; the district court properly exercised its discretion in excluding the evidence of other projects; the district court correctly decided that the issue of liquidated damages and completion costs were issues of fact that were properly submitted to the jury; there was a legally sufficient evidentiary basis for the district court to deny judgment as a matter of law for Weitz's breach-of-contract claims against Arrowhead; the district court did no err in refusing to enter a default judgment against Concorde when it failed to appear at trial, or in the alternative, refusing to grant Weitz judgment as a matter of law on its claims against Concorde; and because the district court properly found against Weitz on all issues, there was no reason to consider the issue of vicarious liability.

Reshetar Systems, Inc. appealed a judgment of the bankruptcy court determining that the debt owed to Reshetar by debtor was not excepted from discharge. The court held that the debt was not excepted from discharge as the trustee of a constructive trust was not a fiduciary within the meaning of Code. Sec. 523(a)(4) and Minnesota law did not create the fiduciary relationship required by the section. The court also held that nothing in the statute, the contract, or the subcontract gave Reshetar specific property rights in the payments Construction 70 received from Applebee's. Those payments belonged to Construction 70, and Construction 70's use of its own property did not amount to embezzlement. The court also held that Construction 70's use of its own property did not amount to larceny where the payments from Applebee's to Construction 70 belonged to Construction 70. The court finally held that, giving due regard to the bankruptcy court's opportunity to judge debtor's credibility, the court could not say that the bankruptcy court's finding was clearly erroneous.

Plaintiffs filed this diversity action to foreclose a contractor's lien and an architect's and engineer's lien against Phoenix Land & Acquisition, LLC (Phoenix Land) and Phoenix Health, LLC (Phoenix Health), as owners of the property in dispute, and three financial institutions with recorded security interests in the property. Phoenix Land filed a counterclaim, asserting breach of contract, negligence, breach of implied warranty, breach of fiduciary relationship, and deceptive trade practices by plaintiffs. Plaintiffs appealed the district court's order denying their motion to compel arbitration of Phoenix Land's counterclaim. The court held that the district court did not err in finding plaintiffs' motion to compel arbitration on the ground that they had waived their right to arbitrate the dispute; they knew of the right and acted inconsistently with that right; and Phoenix Land suffered prejudice by plaintiffs' inconsistent actions. Accordingly, the court affirmed the judgment of the court.