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

The owners of Landmark Towers appealed the district court's grant of summary judgment in favor of Green Tree Servicing, LLC (Green Tree), permitting Green Tree to vacate office space it subleased from the owners' tenant (DBSI). The lease agreements at issue in this case arose from a complex real estate transaction that DBSI and its affiliates commonly structured in order to generate revenue. DBSI, a tenant in common syndicator, or an affiliate - here DBSI Landmark, LLC - acquired commercial property and leased it to another affiliate - here DBSI Leaseco. The court found that, irrespective of 11 U.S.C. 365(h), principles of contract law dictated that DBSI Leaseco and Green Tree were no longer required to perform their obligations to each under the sublease. The court also found that the sublease contained promises between the tenants in common (TIC) and Green Tree via the attornment provision and therefore, the parties were in privity of contract regardless of their status as master landlord and sublessee. The court further found that the only surviving contractual interest in the sublease was the TIC's right to attornment, which was triggered only when the TIC succeeded to the interest of DBSI Leaseco. Therefore, the sublease did not require Green Tree to attorn to the TIC here.

The Minch Family sued the Estate of the Norbys in diversity, seeking injunctive relief and damages for flooding of the Minch Family's property, allegedly caused by a field dike built on the Norbys' land. At issue was whether the district court erred in concluding that the Minch Family's claims were time-barred and whether the magistrate judge abused its discretion by denying the Minch Family's motion to amend its complaint to allege a claim for punitive damages and the Minch Family's motion to amend the scheduling order. The court held that the Minch Family had failed to meet its burden of showing that the applicable two year-statute of limitations should be tolled and its claims were untimely. The court held that because it had affirmed the district court's dismissal of the Minch Family's claims as time-barred, the issue of punitive damages was moot. The court further held that because the Minch Family's motion only related to its claim for punitive damages, the court need not address the issue of whether the magistrate judge abused its discretion in denying its motion to amend the court's scheduling order. Accordingly, the court affirmed the judgment of the district court.

Debtor appealed from the bankruptcy court's order confirming his modified Chapter 13 plan over his objection. At issue was whether the bankruptcy court could confirm the debtor's plan which provided for the avoidance of two junior liens on the debtor's principal residence. The court held that 11 U.S.C. 1322(b)(2) did not bar a Chapter 13 debtor from stripping off a wholly unsecured lien on his principal residence. The court also held that the strip off of a wholly unsecured lien on a debtor's principal residence was effective upon completion of the debtor's obligations under this plan and it was not contingent on his receipt of a Chapter 13 discharge. Accordingly, the court reversed the decision of the bankruptcy court and remanded for further proceedings where the debtor must amend his plan to provide for proper treatment of the junior lienholders' claims as unsecured nonpriority claims.

Plaintiff appealed the district court's grant of summary judgment to defendant on his claim of malicious prosecution under Arkansas law. The district court held that plaintiff failed to present evidence sufficient to withstand summary judgment on two of the five elements necessary to sustain his claim. The court held that the district court erred in holding that the evidence was insufficient as a matter of law to sustain plaintiff's claim that defendant brought suit against him on the guaranty without probable cause. The court also held that a jury must decide what was defendant's motive or purpose in suing plaintiff if it in fact understood it had no reasonable chance of prevailing on the merits of its claim against plaintiff.

Defendant was convicted of one count of arson for setting fire to his home on the Rosebud Indian Reservation. Defendant appealed the restitution order contending that the district court erred in awarding restitution to the two organizations that had provided emergency funds to the victims without reducing the amount of restitution owed to the victims personally. Defendant also contended that the district court further erred in using the replacement cost to determine the value of the homeowner's loss. The court held that the district court erred in awarding full restitution to the family for their personal property losses while also awarding restitution to the Red Cross and the Bureau of Indian Affairs for the amount of funds each provided to the family. The court also held that the district court erred in calculating Sicangu Wicoti Awanyakapi Corporation's actual loss to be the replacement cost of the destroyed home and in failing to account for its retention of defendant's Monthly Equity Payment Account. Accordingly, the court reversed and remanded.

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.

The City of Indianola (City) adopted a land-use ordinance requiring the enclosure of "figure eight cars," among other racing vehicles, when two or more such cars were present. Iowa Assurance Corporation and its co-plaintiffs (collectively referred to as "Watson") sued the City, arguing that the ordinance created an uncompensated regulatory taking in violation of the Fifth and Fourteenth Amendments. At issue was whether the district court erred in using the Penn Central Transportation Co. v. City of New York framework to analyze his takings claim. The court held that the district court correctly determined that the ordinance should not be analyzed under the standards of Loretto v. Teleprompter Manhattan CATV Corp., where the ordinance did not erode Watson's right to exclude others from property, which was central to establishing a Loretto claim. The court also held that the district court correctly concluded that the takings test articulated in Nollan v. California Coastal Commission did not apply to the ordinance where the ordinance did not require Watson to dedicate any portion of his property to either the City's or the public's use. Accordingly, the court affirmed the well-reasoned judgment of the district court in its entirety.

The Andersons appealed the grant of summary judgment by the district court in favor of Hess Corporation (Hess), the successor in interest to and lessee of mineral rights on the Andersons' land. The Andersons contended that the district court erred in construing the five leases at issue as requiring Hess to engage in "drilling operations" rather than actual "drilling" in order to extend the primary terms of the leases and granting Hess's motion for summary judgment. The court held that the district court did not abuse its discretion in declining to certify the Andersons' question regarding the meaning of the phrase "engaged in drilling or reworking operations." The court also held that this disputed lease language was not ambiguous and meant "engaged in drilling operations or reworking operations." Therefore, the district court correctly interpreted the disputed lease language and properly granted summary judgment in favor of Hess on the Andersons' quiet title claim.

Plaintiff filed suit against, inter alia, U.S. Bank, N.A. (U.S. Bank) seeking to invalidate the foreclosure and sale of his home. Plaintiff alleged that the mortgage that the lender relied upon in foreclosing on his home was defective and therefore could not provide a valid basis for foreclosure under Minnesota law and that the lender violated the Truth in Lending Act (TILA), 15 U.S.C. 1601, et seq., by failing to provide required notice to plaintiff of his ability to cancel the transaction and by refusing to cancel the mortgage when plaintiff exercised his right to rescind the mortgage on those grounds. The court declined to reach plaintiff's Minnesota Statute 523.23 argument where plaintiff conceded he never cited to this provision to the district court at trial nor in his motion for new trial or amended verdict. The court also held that plaintiff's wife was authorized to receive the Notice of Right to Cancel on plaintiff's behalf; plaintiff cited to no evidence or legal authority that the second Notice of Right to Cancel was required under TILA; plaintiff had no standing to challenge the lender's failure to send the second notice to his former wife; and plaintiff had not overcome the rebuttable presumption of delivery of the required notice to him. Accordingly, the judgment of the district court was affirmed.

This case stemmed from the replevin actions filed by Klein Bank against debtors. Klein Bank appealed from the Orders of the Bankruptcy Court denying its motions to remand its replevin actions which had been removed from the state court to the bankruptcy court. In denying the motions, the Bankruptcy Court concluded that replevin actions were core proceedings. While this appeal was pending, the United States Supreme Court clarified that core proceedings were limited to those "arising under or arising in" a bankruptcy case. Based on that, the court now concluded that the matters involved in the replevin actions were not core proceedings. Accordingly, the court reversed and remanded to the Bankruptcy Court for further findings on the question of whether the court was required to abstain under 28 U.S.C. 1334(c)(2).