Justia Business Law Opinion Summaries

In 2005, Winyah Bay Holdings, LLC held an event aimed at selling marsh-front lots located in South Island Plantation, an affluent, unbuilt housing development. Winyah conducted the sale by lottery, and geared the event toward on-the-spot sales. Winyah had Wachovia Bank and two unrelated realty and marketing companies (the Realtors) set up booths to promote financing the lot sales. Respondents alleged that Winyah, the Realtors, and Wachovia further enticed potential buyers by promising that "day docks, roads, infrastructure, pool [sic], marsh walks, and other amenities would be in place within 18 months of the lottery." Respondents William and Judith Blackburn claimed these promises got them to participate in the lottery. Over six months later, Respondent William Blackburn delivered a promissory note to Wachovia in the amount of $463,967 to finance the purchase of one of the lots. The note was secured by a mortgage and unconditional personal guaranties executed by Tammy Winner, Watson Felder, and Respondents. Sometime in 2008, Respondents failed to make payments on the note. Wachovia then filed a foreclosure action. Respondents answered, asserting counterclaims against Wachovia, cross-claims against the South Island Plantation Association, Incorporated (the HOA), and a third-party complaint against the Seller and the Realtors. At issue here were the counterclaims against Wachovia, which included claims for negligent misrepresentation, promissory estoppel, breach of contract/breach of contract accompanied by a fraudulent act, breach of fiduciary duty, fraud/fraud in the inducement, breach of contract/negligence, breach of contract, civil conspiracy, illegality of contract, and violations of the South Carolina Unfair Trade Practices Act (the SCUTPA). Wachovia appealed the court of appeals' decision to reverse the circuit court's determination that Respondents' counterclaims were within the scope of a jury trial waiver in the property sales documents. The Supreme Court affirmed the portion of the appellate courts' judgment finding that the waivers were executed knowingly and voluntarily; however, the Court reversed the portion finding that the outrageous and unforeseeable torts exception to arbitration applies in the jury trial waiver context, and found instead that Respondents waived their right to a jury trial on all of their counterclaims. View "Wachovia Bank v. Blackburn" on Justia Law

In 2006, DLI Properties, LLC (DLI), hired Allen Tate, a real estate brokerage firm, and Faile, Allen Tate's licensee, to serve as its agents in connection with the sale of certain real property in Lancaster, South Carolina. Petitioners, using Sharon Davis of Davis Integrity Realty, Inc. as their broker, offered to purchase the property. Petitioners sued Respondents alleging fraud, negligent misrepresentation, and violations of the South Carolina Unfair Trade Practices Act (the SCUTPA) based on DLI's acceptance of an offer on the property and Faile's representation that DLI would accept Petitioner's offer. Petitioners claimed Respondents made misrepresentations concerning the validity and effectiveness of their agreement to purchase the property. Petitioners asserted Respondents had a duty of care to communicate truthful information to Petitioners, and breached that duty by failing to disclose the ultimately successful offer, and the fact that DLI had not signed Petitioners' offer. Petitioners further alleged Respondents demonstrated a pattern of behavior sufficient to establish a SCUTPA violation. Petitioners appealed the circuit court's decision that granted summary judgment in favor of the Respondents. After careful consideration of the circumstances of the deal, the Supreme Court affirmed, noting that the appellate court erred only by not addressing the merits of Petitioners' appeal. On the merits, the Court affirmed the circuit court as modified. View "Woodson v. DLI Properties" on Justia Law

In December 2004, Atlantic Carolina Retail, LLC loaned $3,075,000 to Monarch Development, LLC. Atlantic collateralized the loan by taking a mortgage on three properties. Atlantic purchased a title insurance policy from First American Title Insurance Company to insure these mortgage interests against potential title defects. Subsequently, Atlantic assigned the mortgages and secured debt to Preservation Capital Consultants, LLC. In 2008, Monarch Development sold its parcel and paid Preservation Capital money to release its lien on that property. Then, Monarch defaulted on its loan agreement with Preservation Capital. Preservation Capital discovered Monarch Development never owned the parcel; instead, Monarch Holdings owned it. Monarch Holdings later transferred the property to a third party without payment or notice to Preservation Capital. Preservation Capital ultimately foreclosed. Atlantic purchased the property at the foreclosure sale by way of a credit bid. After foreclosing on the parcel, Monarch Development owed Preservation Capital a remaining balance. Preservation Capital filed a claim under its policy with First American for the amount it was unable to collect on the one of the other parcels due to the title defect. First American denied coverage. Preservation Capital filed this action when First American refused its claim. Both parties moved for summary judgment. First American Title Insurance Company appealed the circuit court's order granting summary judgment in favor of Preservation Capital. First American argued the circuit court misconstrued the terms of the title insurance policy in finding Preservation Capital was entitled to recover under the policy. Finding the circuit court properly granted summary judgment in favor of Preservation Capital, the Supreme Court affirmed. View "Preservation Capital v. First American" on Justia Law

Samuel W. Rhodes and Piedmont Promotions, Inc. sued Marion L. Eadon, (d/b/a C&B Fabrication), for damages arising out of the faulty construction of three outdoor advertising billboard signs after one of the signs fell across Interstate 77. A jury returned a verdict for actual and punitive damages in favor of Rhodes. At the time of the suit, Eadon's two corporations, C&B Fabrications, Inc. and Low Country Signs, Inc., were listed as named insureds under a commercial general liability policy issued by Auto-Owners Insurance Company. Eadon sought indemnification from Auto-Owners for the verdict. In response, Auto-Owners filed a declaratory judgment action to determine whether it had a duty to indemnify Eadon under the policy. Upon review, the Supreme Court concluded the Court of Appeals correctly affirmed the judge's denial of Auto-Owners' motion pursuant to Rule 60(b), SCRCP. Further, the Court held the declaratory judgment action was procedurally proper save for a ruling on issues regarding property damages as there are related questions of fact that must be decided by a jury on retrial. View "Auto-Owners v. Rhodes" on Justia Law

Carl Aten, Jr. appealed the circuit court's order finding him personally liable for torts he committed as a member of a limited liability company (LLC). Although this case presented a novel question of whether the Uniform Limited Liability Company Act (LLC Act) shields an LLC member from personal liability from his own torts, the Supreme Court declined to opine on that issue, and found that Aten committed no actionable tort. Therefore the Court reversed the portion of the circuit court's order which imposed personal liability upon Aten. View "16 Jade Street v. R. Design Construction" on Justia Law

This dispute arose from the construction of a commercial building. Before the property was purchased, Respondent Bryan Causey hired GS2 Engineering and Environmental Consulting, Inc. (GS2) to perform an engineering analysis of the soils on the property to determine whether the land was suitable for construction. Causey formed Causey Consulting, LLC (of which he was the sole member), and Causey Consulting purchased the property to construct the commercial building. Appellant Crouch Construction Company was retained as the general contractor. The parties' dispute began over the amount of unsuitable soils excavated from the building site: during construction, it became apparent that more unsuitable soil needed to be removed than was initially anticipated, and the removal of additional soil increased the cost of the project. The construction project was substantially completed then occupied by Respondent Celebrations of Columbia, LLC, of which Causey is also a member. When Appellant did not receive final payment for the work, it filed a mechanic's lien and a suit to foreclose the lien. The circuit court ordered arbitration pursuant to an arbitration clause in the construction contract. The arbitrator determined Appellant was owed money under the contract, plus interest, attorney's fees and costs. Respondents moved to vacate the award, seeking to have it set aside based on several unfavorable evidentiary rulings and general allegations that the arbitrator manifestly disregarded the law. The circuit court denied Respondents' motion. However, before an order was entered, Respondents learned that an engineer employed by GS2 was the brother of one of the arbitrator's law partners. Respondents filed a supplemental motion to vacate the arbitration award, reiterating their previous arguments and raising several new claims, citing the arbitrator's failure to disclose his law partner's relationship with an employee of GS2. The circuit court found that vacatur was warranted, and , the circuit court held the award should be set aside. Upon review, the Supreme Court concluded that the arbitrator was not evidently partial towards GS2 or either party. Accordingly, the Court reversed and remanded the case to the circuit court for confirmation of the arbitration award. View "Crouch Construction v. Causey" on Justia Law

The issue before the Supreme Court in this case was one of first impression centering on the foreclosure on a member of a limited liability company's (LLC) interest under the South Carolina Uniform Limited Liability Company Act. Kriti Ripley, LLC and Emerald Investments, LLC formed Ashley River Properties II, LLC for the purpose of developing a parcel of property. Emerald made in-kind contributions for its share in Ashley River II, and Kriti contributed cash. Immediately, Emerald and its sole member, Stuart Longman, diverted and misappropriated those funds. Upon learning of Emerald and Longman's wrongdoing, Kriti and Ashley River II obtained a judgment against Emerald and Longman, and Emerald was stripped of its voting rights in and management of Ashley River II. Since then, Emerald and Longman refused to pay any amount towards the judgment and instead have engaged in a pattern of abusive litigation. Kriti and Ashley River II obtained a charging order against Emerald's interest and later moved to foreclose on that interest. The circuit court denied the motion for foreclosure. Upon review, the Supreme Court concluded that the circuit court erred in denying the motion to foreclose, finding that it failed to consider the likelihood of satisfaction of the judgment through distributions. The Court remanded the case for foreclosure and the sale of Emerald's interest in Ashley River II. View "Kriti Ripley, LLC v. Emerald Investments" on Justia Law

Petitioners' properties were in danger of foreclosure. Prior to any foreclosure action, Petitioners obtained loan modifications from their respective lenders to extend their loans' maturity dates and receive additional time to pay. Petitioners were unable to keep up with payments under the modification, and sought to prevent foreclosure arguing that the lenders engaged in the unauthorized practice of law by modifying the loans without an attorney. The Supreme Court disagreed, finding that modifying the loans without attorneys was not the unauthorized practice of law. View "Crawford v. Central Mortgage" on Justia Law

The issue before the Supreme Court centered on the grant of summary judgment in favor of Respondent Action Concrete Contractors, Inc. in a mechanic's lien foreclosure action. Owners Elvira Chappelear, Craig Chappelear, Premier Southern Homes, LLC, Henry G. Beal, Jr. and First Citizens Bank and Trust Co., Inc. argued on appeal there were material issues of fact and that the grant of summary judgment was inappropriate. The Supreme Court disagreed after its review of the trial court record and affirmed. View "Action Concrete v. Chappelear" on Justia Law

Plaintiffs Health Promotion Specialists, LLC sued the state Board of Dentistry based on the Board's enactment and enforcement of regulations relating to certain procedures performed by dental hygienists in school settings. The Board was awarded summary judgment; Health Promotion appealed, arguing the circuit court erred by concluding: (1) the Board was immune from suit under the state Tort Claims Act; (2) Health Promotion could not maintain an action under the state Unfair Trade Practices Act because the Board was not a "person" and its actions were not within "trade or commerce;" and (3) Health Promotions could not amend its complaint. Upon review, the Supreme Court found the Board was immune from suit and affirmed the circuit court's grant of summary judgment. View "Health Promotion Specialists v. SC Board of Dentistry" on Justia Law