When do ambiguous contract terms preclude summary judgment in Utah? Shree Ganesh v. Weston Logan Explained

The Utah Supreme Court’s decision in Shree Ganesh v. Weston Logan demonstrates how contractual ambiguity can derail summary judgment motions, even when the moving party appears to have strong legal arguments.

Background and Facts

Shree Ganesh purchased a Best Western hotel from Weston Logan under a Purchase Agreement containing disclosure requirements in Section 8.1 for “other written agreements…which affect the property” and Section 12 prohibiting acts that “materially change the value of the Property.” During the sale process, Weston Logan was simultaneously developing a competing hotel across the street but failed to disclose these plans. When Shree Ganesh discovered the competing development after closing, it sued for breach of contract and fraudulent nondisclosure.

Key Legal Issues

The case presented two primary issues: (1) whether the Purchase Agreement’s disclosure provisions were ambiguous regarding Weston Logan’s obligations, and (2) whether genuine disputes of material fact existed regarding the tort claims for fraudulent nondisclosure.

Court’s Analysis and Holding

The Supreme Court reversed the summary judgment, finding the Purchase Agreement ambiguous. The district court had interpreted “Property” to refer solely to real estate, but the Supreme Court noted the agreement described the property as the “89 Unit Best Western Plus Weston Inn” and included hotel-related assets like “leases, contracts, signage, billboards” and required disclosure of “operating statements.” This suggested the parties intended to transfer a functioning hotel business, not merely real property. The court held that contractual ambiguity creates questions of fact for the fact-finder, precluding summary judgment.

Regarding the tort claims, the court found genuine disputes about whether Weston Logan breached its duty to disclose material elements of the property and whether it failed to clarify potentially misleading statements made by its real estate agent.

Practice Implications

This decision reinforces that Utah courts will not grant summary judgment when contract terms are susceptible to multiple reasonable interpretations. Practitioners should carefully draft disclosure provisions to avoid ambiguity, particularly in commercial transactions where the scope of “property” may encompass both real estate and business operations. The decision also confirms that fraudulent nondisclosure claims can survive summary judgment when material fact disputes exist about disclosure duties and the materiality of withheld information.