Justia West Virginia Supreme Court of Appeals Opinion Summaries

This case involves a dispute between Blackrock Enterprises, LLC and BB Land, LLC and JB Exploration 1, LLC over a Lease Acquisition Agreement (LAA). Both parties claimed the other had breached the agreement and sought declaratory relief regarding their respective rights and obligations. The trial was bifurcated into two phases. In the first phase, a jury found that both parties had materially breached the LAA, but that Blackrock had committed the first material breach. As a result, the business court concluded that Blackrock could not recover for any subsequent breach committed by Jay-Bee. In the second phase, the business court determined that the parties were engaged in a de facto mining partnership and ordered Blackrock dissociated from the partnership. The court also valued Blackrock’s partnership interest at zero and ordered it to quit-claim its interests in certain leases to Jay-Bee. Blackrock appealed, arguing that the business court committed multiple errors in both phases of the proceedings.The Supreme Court of Appeals of West Virginia found that the business court erred in its construction of the first material breach doctrine and by granting judgment for Jay-Bee on the basis of clearly erroneous findings “deemed” made by operation of West Virginia Rule of Civil Procedure 49(a). The court reversed the final judgment and remanded for a new trial and further proceedings. The court also vacated that portion of the final judgment order finding the parties engaged in a mining partnership. View "Blackrock Enterprises, LLC v. BB Land, LLC" on Justia Law

The Supreme Court of Appeals of West Virginia recently ruled on a case involving the nonprofit organization Tax Analysts and Matthew Irby, the West Virginia State Tax Commissioner. Tax Analysts requested copies of field audit and audit training manuals from the West Virginia State Tax Department under the West Virginia Freedom of Information Act (FOIA). The Department denied the request, citing a statutory exemption protecting certain tax-related documents. Tax Analysts then filed a declaratory judgment action seeking to prevent the Department from withholding the requested documents.The Circuit Court of Kanawha County ruled in favor of the Department and dismissed the case, accepting the Department's argument that the documents were statutorily protected by the asserted FOIA disclosure exemption. However, the Supreme Court of Appeals of West Virginia reversed this decision, concluding that the circuit court erred by not requiring the Department to present detailed justifications, known as a Vaughn index and an affidavit, as to why each document or part of it was exempt from disclosure under the FOIA.The court remanded the case with instructions for the circuit court to require the Department to file a Vaughn index and an affidavit explaining why disclosure of the documents would be harmful and why they should be exempt. The court concluded that the Department had not met its burden of showing the express applicability of the claimed exemption to the material requested. View "Tax Analysts v. Irby" on Justia Law

The case in question arose from a multi-million-dollar loss suffered by Westlake Chemical Corporation and Axiall Corporation (the respondents) at their chlorine manufacturing plant in Natrium, West Virginia. The loss occurred when 90 tons of liquid chlorine leaked from a rupture in a railroad tanker car that had been recently repaired by third-party contractors. The liquid chlorine vaporized into a cloud or plume that caused corrosion damage to the equipment at the plant. The respondents claimed the damage costs from their insurance companies (the petitioners). However, the insurance companies denied coverage based on three exclusions in the insurance policies relating to corrosion, faulty workmanship, and contamination. The case reached the Supreme Court of Appeals of West Virginia, which was asked to review three orders of the Circuit Court of Marshall County, West Virginia, Business Court Division. The lower court had granted partial summary judgment to the respondents, finding that none of the three exclusions barred the respondents’ coverage claims. The Supreme Court of Appeals of West Virginia concluded that the lower court's orders were not final orders subject to appeal at this stage of the proceedings. This was due to unresolved issues of causation and damages, and because the orders did not conclusively determine the disputed controversy, resolve an important issue completely separate from the merits of the action, or were effectively unreviewable on appeal from a final judgment. Therefore, the court dismissed the appeal, without prejudice. View "NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA. v. WESTLAKE CHEMICAL CORPORATION" on Justia Law

The Supreme Court granted a writ of prohibition sought by Thornhill Motor Care, Inc. to prevent the Circuit Court of Mingo County from enforcing its order denying Petitioner's motion to dismiss based on improper venue, holding that Thornhill established that it was entitled to the writ.Moore Chrysler, Inc. brought this action against Thornhill in Mingo County, alleging violations of W. Va. Code 17A-6A-1 to -18 and seeking declaratory and injunctive relief. Thornhill moved to dismiss the complaint pursuant to W. Va. R. Civ. P. 12(b)(3) on the basis of improper venue, asserting that the proper venue for this lawsuit was in Logan County pursuant to the general venue statute, W. Va. Code 56-1-1. The circuit court denied the motion, basing its ruling on a specific venue statute, W. Va. Code 17A-6A-12(3), which governs declaratory judgment actions brought by new motor vehicle dealers against manufacturers or distributors. Thornhill then sought the writ of prohibition at issue. The Supreme Court granted the writ, holding that the circuit court committed clear legal error in applying section 17A-6A-12(3) rather than section 56-1-1. View "Thornhill Motor Car, Inc. v. Honorable Miki Thompson" on Justia Law

The Supreme Court reversed the business court's orders in this rent dispute, holding that the business court erred in granting summary judgment to either party.American Bituminous Power Partners, LP (AMBIT) and Horizon Ventures of West Virginia, Inc. created a contractual relationship with a lease agreement. The current rent dispute involved the relationship between the lease, a 1996 settlement agreement, and a 2017 order of the business court. Without resolving the relationship between those documents the business court granted summary judgment to AMBIT on Horizon's claims and summary judgment to Horizon on AMBIT's claims. The Supreme Court reversed, holding that summary judgment was improper because the various agreements were ambiguous and the parties' intent was not clear. View "Horizon Ventures of W. Va., Inc. v. American Bituminous Power Partners, L.P." on Justia Law

The Supreme Court affirmed the judgment of the circuit court denying the motions filed by both sides for reasonable attorney fees and expenses after a settlement left each side convicted that the other side had behaved in bad faith, holding that the circuit court acted within its discretion in denying Michael Harlow's motion for attorney fees and expenses.Harlow was one of three members of Eastern Electric, LLC when Eastern lost almost $400,000 in a prevailing wage case. Thereafter, Harlow dissociated from Eastern. Eastern made an offer to purchase Harlow's interest, but Harlow rejected the offer. Harlow then sued to enforce his statutory right to receive fair value for his interest. The parties eventually settled. Both sides then sought to recover their attorney fees and expenses. The circuit court rejected both parties' motions, and Harlow appealed. The Supreme Court affirmed, holding that the circuit court did not abuse its discretion in refusing an award of fees. View "Harlow vs. Eastern Electric, LLC" on Justia Law

The Supreme Court reversed the orders of the circuit court granting Respondents' motions to dismiss, holding that Petitioners' pleading stated a sufficient basis upon which relief could be granted and that Respondents failed to show beyond a reasonable doubt that Petitioners could prove no set of facts in support of their claims that would entitle them to relief.On appeal, Petitioners argued that in granting Respondents' motions to dismiss pursuant to Rule 12(b)(6) the circuit court failed to consider all the Petitioners' factual allegations. Further, Petitioners alleged that for the few allegations it did consider, the circuit court improperly imputed inferences favorable to Respondents. The Supreme Court reversed, holding (1) Respondents failed to establish beyond doubt that Petitioners' pleading did not state a claim upon which relief may be granted; and (2) Petitioners sufficiently alleged a claim for aiding and abetting tortious interference. View "Mountaineer Fire & Rescue Equipment, LLC v. City National Bank of West Virginia" on Justia Law

The Supreme Court answered a question certified to it by a federal district court regarding W. Va. Code 31E-3-304(b)(2), holding that beyond the derivative suit mentioned in the statute, a member of a nonprofit corporation's board of directors may not file a derivative suit against another director to recover damages or other relief on behalf of the nonprofit corporation.Section 31E-3-304(b)(2) permits a member of a nonprofit corporation's board of directors to file an "ultra vires" derivative suit against another member of the board of directors to challenge the validity of an action taken by the corporation. At issue in this case was whether the Legislature intended to preclude such derivative suits brought by a member of the board of directors against another director to recover damages or other relief on behalf of nonprofit corporations. The Supreme Court answered in the negative, holding that, other than as expressly authorized by section 31E-3-304(b)(2), the West Virginia Nonprofit Corporation Act does not confer the right upon a director to bring a derivative action on behalf of the nonprofit corporation. View "John A. Sheppard Memorial Ecological Reservation, Inc. v. Fanning" on Justia Law

The Supreme Court reversed the order of the circuit court certifying as final the prior orders that granted summary judgment to Respondents in this civil action arising out of the modification of covenants pertaining to a residential subdivision developed by RJM Holdings, LLC, holding that the genuine issues of material fact precluded summary judgment.On appeal, Petitioners argued that the circuit court erred by granting summary judgment because genuine issues of material fact existed regarding whether Respondents were engaged in a joint venture with RJM to develop the subdivision and whether the corporate veils of the respondent businesses should be pierced to hold certain individuals personally liable. The Supreme Court agreed and reversed, holding that genuine issues of material fact existed with respect to the conduct of Respondents and the use of the various business entities to develop the subdivision. View "Dailey v. RJM Holdings, LLC" on Justia Law

In this long-running contractual dispute between Petitioners, the West Virginia Investment Management Board (IMB) and the West Virginia Consolidated Public Retirement Board (CPRB) and Respondent, The Variable Annuity Life Insurance Company (VALIC), the Supreme Court affirmed the order dismissing this matter from the Business Court Division’s docket in reliance on conclusions reached in an arbitration panel’s final decision.The first time the parties were before the Supreme Court, the Court reversed a summary judgment and remanded for further proceedings. The Court further directed that the matter be referred to the Business Court Division. Due to the complexity of the case, the parties agreed to submit the dispute to binding arbitration before a panel of three business court judges. The panel unanimously found in favor of Respondent. The Supreme Court affirmed, holding (1) there was no cause to void the parties’ agreement to submit the matter to binding arbitration; and (2) Petitioners’ arguments that the panel failed to apply the law of the case and neglected to decide all issues before it were unavailing. View "W. Va. Investment Management Board v. Variable Annuity Life Insurance Co." on Justia Law