Justia West Virginia Supreme Court of Appeals Opinion Summaries

In this dispute concerning a liability insurance policy, the Supreme Court granted relief in prohibition to State Auto Property Insurance Companies, holding that State Auto was entitled to a dismissal of CMD Plus, Inc.’s third-party complaint as a matter of law.When Plaintiffs filed an action against CMD, a residential construction company, seeking recovery for damages to their house and property, CMD filed a third-party complaint against State Auto, its insurer, alleging that State Auto delayed investigating Plaintiffs’ claim, settling Plaintiffs’ lawsuit, and indemnifying CMD. In this petition for a writ of prohibition, State Auto challenged the circuit court’s denial of its motion for summary judgment. The Supreme Court held that relief in prohibition was warranted because the record showed that State Auto defended and indemnified CMD throughout the lawsuit as required by the commercial general liability policy, and the terms of the policy provided no coverage to CMD for damage to its own property. View "State ex rel. State Auto Property Insurance Cos. v. Honorable James C. Stucky" on Justia Law

The Supreme Court reversed the circuit court’s order denying Bluestem Brands, Inc.’s motion to compel arbitration brought by Respondent. Bluestem, a retailer of consumer goods, partnered with various bands to offer credit to its customers. The circuit court concluded that the arbitration agreement entered into by the parties was not binding on Respondent. Specifically, the circuit court found that Respondent did not assent to arbitration because she did not receive a copy of the most recent credit card agreement containing arbitration language and that Bluestem’s credit partners, and not Bluestem itself, were party to any potentially applicable credit agreement requiring arbitration. In reversing, the Supreme Court held (1) although the most recent amendments to the credit agreement lacked mutual assent, a prior version of the credit agreement contained a properly formed arbitration agreement and encompassed Respondent’s claims; and (2) Bluestem, as a non-signatory to the agreement, may utilize the theory of equitable estoppel to compel arbitration under the agreement. View "Bluestem Brands, Inc. v. Shade" on Justia Law

In the absence of an agreement to the contrary, waiver of a contractual right to arbitration is a threshold question of enforceability to be determined by a court, not an arbitrator.Respondents commenced an arbitration against Petitioner pursuant to an agreement between the parties alleging breach of contract. Petitioner ultimately filed a motion for a preliminary and permanent injunction to prohibit Respondents from pursuing their claims through arbitration. The circuit court denied the motion. The Supreme Court reversed and remanded for entry of an order enjoining Respondents from pursuing further arbitration, holding (1) the question of waiver should have been determined by the circuit court rather than an arbitrator; (2) Respondents were not allowed to reinitiate the arbitration process under the American Arbitration Association after having voluntarily abandoned their claims in arbitration under Financial Industry Regulatory Authority, Inc.; and (3) Respondents waived their right to pursue any future arbitration under the agreement. View "Williams v. Tucker" on Justia Law

After a fatal vehicular accident, Christina Varvel asserted a declaratory judgment action against Universal Underwriters Insurance Co. and Zurich American Insurance Co. (collectively, Zurich) to determine the amount of insurance coverage available. Varvel also sued Salvatore Cava, Daniel Cava, and Dan’s Car World, LLC (collectively, the Cava defendants). The Cava defendants filed individual cross-claims against Zurich, their insurer. Zurich filed a motion to dismiss the Cava defendants’ cross-claims under W. Va. R. Civ. P. 12(b)(6). The circuit court denied Zurich’s motion to dismiss, determining that the Cava defendants asserted recognized causes of action against Zurich. Zurich sought a writ of prohibition to prevent enforcement of the circuit court’s order. The Supreme Court granted a writ of prohibition, as moulded, holding that the Cava defendants’ cross-claims against Zurich were not ripe for adjudication. Therefore, the circuit court lacked subject matter jurisdiction, and the order denying Zurich’s motion to dismiss the Cava defendants’ cross-claims was void and unenforceable. View "State ex rel. Universal Underwriters Insurance v. Honorable Patrick N. Wilson" on Justia Law

Where a lessee designates tracts of land for pooling regarding horizontal drilling and production of oil and gas from the Marcellus Shale Formation, which includes nonparticipating royalty interests (NPRI), consent or ratification by the holders of the nonparticipating royalty interests is not required where the holders of the NPRIs have conveyed the oil and gas in place and the executive leasing rights thereto to the lessor.At issue was a voluntary pooling and unionization lease provision regarding horizontal drilling and production of oil and gas from the Marcellus Shale Formation. PPG Industries, Inc., the lessor, and Gastar Exploration USA, Inc., the lessee, signed a lease under which 700 acres were designated by Gastar as the Wayne/Lily Unit for purposes of pooling the oil and gas interests held by various individuals and entities. PPG and Gastar challenged the circuit court’s entry of partial summary judgment in favor of Plaintiffs, who collectively held a nonparticipating royalty interest in the oil and gas underlying a parcel included within the Wayne/Lily Unit. The Supreme Court reversed, holding that the circuit court erred in ruling that the validity of the pooling provision in the PPG-Gastar lease and the designated Wayne/Lily Unit were void until such time as pooling was consented to and ratified by Plaintiffs. View "Gastar Exploration Inc. v. Contraguerro" on Justia Law

Leslie Meadows filed a complaint against William Erps claiming that Erps owed he money from several real estate projects that she shared with him. For purposes of appeal, Meadows’s claims involved two of those transactions with Erps: (1) claims related to the purchase of, improvements to, and sale of the Sutphin property; and (2) claims related to the financing for the Twiford apartments. The circuit court awarded judgment to Meadows in the amount of $18,675 with respect to the Sutphin property and $67,000 for the Twiford apartments, for a total sum of $85,675. The Supreme Court reversed in part, holding (1) the circuit court’s award of judgment of $18,675 to Meadows as an abuse of discretion; and (2) the circuit court’s award of $67,000 was an abuse of discretion, and the circuit court’s award of judgment on the Twiford apartments is hereby reduced to $30,000. Remanded with directions to vacate the judgment for Meadows on the Sutphin property and to enter judgment for Meadows on the Twiford apartments in the amount of $30,000. View "Erps v. Meadows" on Justia Law

A subsidiary company brought an action seeking a declaratory judgment against its parent companies, challenging three management agreements by which the parent companies controlled, managed, and participated in the affairs of the subsidiary. The subsidiary argued that two clauses in the agreements were unconscionable because one stated that the parent companies could never be liable to the subsidiary company and the other required the subsidiary to indemnify the parent companies for all legal and liability costs. The circuit court declared that the two clauses at issue were unconscionable and unenforceable. The Supreme Court affirmed, holding that the circuit court did not err in ruling that the two challenged clauses were unconscionable because the clauses were oppressive and unfair. View "Blackrock Capital Investment Corp. v. Fish" on Justia Law

Beecher Osborne filed a lawsuit against Allegheny Wood Products, Inc. and Heartwood Forestland Fund, IV, Limited Partnership. The parties entered into a pre-trial settlement agreement containing (1) a consent judgment in which the defendants agreed to a $1 million judgment against them, (2) a covenant not to execute in which Osborne promised not to collect the judgment from the defendants, and (3) an assignment from the defendants to Osborne of all claims they may have had against Penn-America Insurance Company for failing to provide them a defense in the lawsuit. Osborne subsequently dismissed his lawsuit against Allegheny and Heartwood and filed a new lawsuit against Penn-America on his assigned claims to collect the consent judgment. The circuit court granted summary judgment in favor of Osborne and ordered Penn-America to pay Osborne the consent judgment. The Supreme Court reversed, holding (1) the consent judgment was not binding on Penn-America because it was not a party to the underlying lawsuit; and (2) under the facts of this case, the assignment by Allegheny and Heartwood to Osborne of any claims they may have had against Penn-America was void. Remanded with direction to enter summary judgment for Penn-America and to dismiss Penn-America from Osborne’s lawsuit with prejudice. View "Penn-America Insurance Co. v. Osborne" on Justia Law

This action arose from the murder of a teenager by her two friends. The victim’s parents filed a wrongful death action against the killers and the two women they lived with, Tara Clendenen and Rachel Shoaf. Clendenen and Shoaf were insured under homeowner’s insurance policies issued by American National Property and Casualty Company (ANPAC) and Erie Insurance Property and Casualty Company (Erie). Although not parties to the state court action, ANPAC and Erie filed declaratory judgment actions in the federal district court seeking a determination that the homeowner’s insurance policies did not provide coverage for the claims being asserted in the complaint and that the insurers had no duty to defend or indemnify the defendants. The federal court found that it was unclear whether coverage was available to Sheaf and Clendenen in the state court action and certified questions to the Supreme Court. The Supreme Court held (1) the unambiguous intentional/criminal acts exclusions in the insurers’ policies precluded liability coverage to Clendenen and Shoaf for the claims in the underlying case because the murder was expected or intended by the killers, co-insureds under their respective policies; and (2) the unambiguous severability clauses in the insurers’ policies did not prevail over the unambiguous intentional/criminal acts exclusions. View "American National Property & Casualty Co. v. Clendenen" on Justia Law

Plaintiffs, on behalf of themselves and others similarly situated, were former students in the nursing program at Salem International University (Salem). When Plaintiffs enrolled, they signed enrollment agreements that contained an arbitration clause. Plaintiffs filed a putative class action complaint against Salem and its president (collectively, Salem) alleging that they were denied the opportunity to complete their coursework in nursing at Salem as a result of the nursing program’s loss of accreditation. Salem filed a motion to stay proceedings pending mandatory alternative dispute resolution. The circuit court denied the motion, concluding that the arbitration agreement did not include an enforceable class action litigation waiver. The Supreme Court reversed, holding that the arbitration agreement acted as a class action litigation waiver barring Plaintiffs from seeking judicial relief as a class. View "Salem International University v. Bates" on Justia Law