Justia Alaska Supreme Court Opinion Summaries

In 1995, Alaska Interstate Construction's assets were sold to a joint venture but it continued to be operated by its founder, John Ellsworth, through a company he owned called Pacific Diversified Investments, Inc. In 1998, Alaska Interstate conveyed a 20% ownership interest to Ellsworth and entered into an operating agreement that provided for Ellsworth's continued management of its operations through Pacific Diversified Investments. Alaska Interstate filed suit against Pacific and Ellsworth in 2005, principally alleging fraud, breach of the covenant of good faith and fair dealing, violation of the Unfair Trade Practices Act, breach of the parties' operating agreement, and conversion. The jury returned a verdict of $7.3 million in favor of Alaska Interstate on its Unfair Trade Practices Act claims and $7.3 million on its claims for common law fraud and breach of fiduciary duty. The parties filed many post-trial motions. Though the jury decided that Pacific Diversified Investments and Ellsworth engaged in conduct that was fraudulent, it decided that they did not materially breach the parties' operating agreement. Alaska Interstate filed a post-verdict motion for judgment notwithstanding the verdict arguing the jury's finding of fraud required the finding that the operating agreement was materially breached. That motion was denied. But the superior court did enter judgment notwithstanding the verdict nullifying the $7.3 million award for violations of the Unfair Trade Practices Act. Alaska Interstate Construction appealed; Pacific cross-appealed. Upon review, the Supreme Court affirmed the superior court's denial of the motion for judgment notwithstanding the verdict which found that the Unfair Trade Practices Act did not apply to intra-corporate disputes. The Court reversed the superior court's judgment notwithstanding the verdict on Pacific's argument that Alaska Interstate's claims were exempt from the Unfair Trade Practices Act. The Court reversed the superior court's ruling on material breach and held that the jury's findings of fraud and wilful misconduct, under the circumstances of this case, required the finding that Pacific materially breached the operating agreement as a matter of law. The Court reversed the superior court's order denying the motion for judgment notwithstanding the verdict on Pacific's fraud in the inducement claim, and we vacated the superior court's determination of prevailing party, award of attorney's fees, and award of prejudgment interest. View "Alaska Interstate Construction, LLC v. Pacific Diversified Investments, Inc." on Justia Law

In late April 2006 Samuel Sengul leased a commercial storefront in downtown Juneau to Robert Manus, who was acting on behalf of CMS Franklin, Inc. The building was under construction when Sengul and CMS entered into the lease agreement, but the lease provided that Sengul would deliver the property to CMS in a specified improved condition by the time the lease commenced on June 1. The lease also included a rent abatement provision, which was at issue in this case. The building was not in improved condition until approximately June 8. Manus did not pay any rent, nor did he mention the rent abatement provision when he took possession of the building. Sengul finally demanded rent in late July, but Manus refused to pay, claiming abatement. In September, Manus had still not paid any rent, and Sengul put a lock on CMS's store door and placed signs demanding rent in the store windows. Manus had the lock cut off, but began to move the inventory out of the store, vacating it and returning the keys to Sengul two days after the lockout. Sengul then sued CMS and Manus for unpaid rent. The superior court determined that CMS had waived its right to rent abatement and owed Sengul unpaid rental amounts for the time that Manus had occupied the building. But the court also concluded that Sengul's lockout amounted to constructive eviction and awarded CMS damages as a refund for work performed on the premises that CMS was unable to benefit from after the constructive eviction. Upon review, the Supreme Court agreed with the superior court that Sengul's actions constituted constructive eviction, but the Court disagreed that CMS waived its entitlement to have the rent abated. The case was remanded for the superior court to recalculate the damages owed to CMS. View "Sengul v. CMS Franklin, Inc." on Justia Law

Appellant Jim Widmyer, a commercial fisher, applied for a permit to fish for sablefish. The State distributes these permits largely on the basis of past participation in the sablefish fishery, specifically participation between 1975 and 1984. Though Appellant had been unable to land many fish between 1975 and 1984, argued that he qualified for participation due to extraordinary circumstances. The Commercial Fisheries Entry Commission and the superior court both determined that Appellant did not qualify for participation due to extraordinary circumstances. The Supreme Court affirmed those decisions after review of the Commission record. View "Widmyer v. Alaska" on Justia Law

This case involved a contract dispute between 3-D & Co. and Tew’s Excavating, Inc. The dispute was over the terms of a construction contract for two roads in the Scenic View Subdivision of the Matanuska-Susitna Borough. 3-D & Co. raised twelve issues on appeal, which in sum, contended that the superior court applied the wrong legal standards and arrived at the wrong factual conclusions regarding the terms of the contract. The Supreme Court took each of 3-D's issues in turn and affirmed the superior court's decisions in all respects. View "3-D & Co. v. Tew's Excavating, Inc." on Justia Law

Robert J. Henrichs, Derenty Tabios, and Robert E. Burk were shareholders and former directors of Chugach Alaska Corporation who ran for election to the Chugach board in 2005. These former directors sued Chugach because their names were excluded from the board’s corporate proxy materials and because Chugach did not provide them with shareholder information for their own proxy campaigns within the time frame they demanded. The superior court granted Chugach summary judgment on all claims and the former directors appealed. Upon review, the Supreme Court affirmed because Chugach was not required to deliver the information the former directors demanded and because Chugach’s conduct did not otherwise violate their rights as board candidates. View "Henrichs v. Chugach Alaska Corporation" on Justia Law

Appellant Robert Stevens was charged with and convicted of violating local borough noise and adult entertainment ordinances. The borough later protested the continued operation of his bar under its Alcoholic Beverage Control Board (ABC Board) liquor license. The ABC Board sustained the protest and denied Appellant's continued operation. Appellant requested an adjudicatory hearing before an administrative law judge (ALJ) to review the ABC Board's decision. The ALJ recommended the ABC Board uphold its initial decision and enforce the denial of continued operation under the license. Appellant appealed to the superior court which affirmed the ABC Board's decision. Appellant appealed again to the Supreme Court, who found the evidence in the ABC Board's and ALJ's record sufficient to overcome a challenge that the borough behaved in an arbitrary and unreasonable manner in protesting Appellant's operation under his liquor license. The Court affirmed the superior court's decision. View "Stevens v. Alaska Alcoholic Beverage Ctrl. Bd." on Justia Law

In 2006, Appellant Yvan Safar contracted with developer Per Bjorn-Roli to construct a 12-unit condominium project. Appellee Wells Fargo agreed to finance the project. By early 2007, the developer paid Appellant the entire amount of his contract, and Wells Fargo disbursed the entire loan, but the units were not complete. Appellant allegedly used his own funds to meet his payroll needs on the project. The project overran its budget, and Wells Fargo had to foreclose. Appellant contended that the bank promised to reimburse him for monies he spent in contemplating the completion of the project. After trial, the superior court found that Wells Fargo made no enforceable promise to Appellant to reimburse him. Upon review, the Supreme Court found that the bank did not make any promise or commitment to Appellant sufficient to meet the "actual promise" element of promissory estoppel. Accordingly, the Court affirmed the lower court's dismissal of Appellant's case. View "Safar v. Wells Fargo Bank, N.A." on Justia Law