AI Generated Opinion Summaries

This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.

Facts

• In 2007, while employed by Zia Credit Union, the Plaintiff was approached by Del Norte Credit Union interested in purchasing his property in Pojoaque, New Mexico. After learning Del Norte was no longer interested, the Plaintiff and Zia Credit Union entered into a contract for Zia Credit Union to purchase the property, with specific terms including a nonrefundable earnest money deposit, lease payments, a guaranteed purchase price, and total funds to Plaintiff. The contract contained a termination provision if any part of a required permit was denied. In 2012, following directives from regulatory authorities, Zia Credit Union terminated the contract. The Plaintiff retained possession of the property and received payments made under the contract terms, including for site improvements (paras 2-4).

Procedural History

• [Not applicable or not found]

Parties' Submissions

• Plaintiff: Argued that Zia Credit Union breached the contract and the implied covenant of good faith and fair dealing by terminating the contract. Asserted that the termination was in bad faith (paras 3, 8, 10).
• Defendant: Contended that the implied covenant claim should not have been presented to the jury, arguing that the contract's termination provision governed the claim. Asserted that the termination was authorized under the contract's terms, especially after regulatory directives to cease branch expansion (paras 7-8, 10).

Legal Issues

• Whether the implied covenant of good faith and fair dealing was applicable under the facts of this case.
• Whether the contract's termination provision authorized the Defendant to terminate the contract without breaching the implied covenant of good faith and fair dealing (paras 7-8).

Disposition

• The court reversed the jury's verdict, concluding that the implied covenant of good faith and fair dealing was inapplicable under the facts of this case, given the contract's express termination provision (para 21).

Reasons

• The court, led by Chief Judge Hanisee, with Judges Bogardus and Henderson concurring, reasoned that the contract's termination provision, which required the Defendant to act in good faith, was consistent with the jury's determination that the Defendant did not breach the contract. The court held that the implied covenant of good faith and fair dealing could not override express provisions of the contract, particularly when the contract itself required good faith in its termination clause. The court found no evidence of bad faith by the Defendant beyond the mere fact of termination, noting that the Defendant had complied with the financial terms of the contract and that the regulatory directive effectively revoked any prior permissions for the project. The court concluded that the implied covenant was not a proper question for the jury, given the contract's specific provisions and the absence of evidence showing an intentional or bad faith violation of contractual rights (paras 8-20).