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Last Reviewed / Modified On 06 Apr 2018.

NEW HAMPSHIRE CONSTRUCTION CLAIMS RESOURCES

Construction Claims

Limitations & Repose Periods

Statute of Repose

Eight Years- “Except as otherwise provided in this section, all actions to recover damages for injury to property, injury to the person, wrongful death or economic loss arising out of any deficiency in the creation of an improvement to real property, including without limitation the design, labor, materials, engineering, planning, surveying, construction, observation, supervision or inspection of that improvement, shall be brought within 8 years from the date of substantial completion of the improvement, and not thereafter.” N.H. Rev. Stat. 508:4-b.

Statutes of Limitations

  1. Breach of Contract: New Hampshire imposes a three (3) year period of limitations on actions for breach of written or verbal contracts. N.H. Rev. Stat. § 508:4(I). This limitations period is extended to twenty (20) years for contracts executed “under seal.” N.H. Rev. Stat. § 508:5.
  2. Tort: New Hampshire imposes a three (3) year period of limitations on tort actions (with the exception of trespass). N.H. Rev. Stat. §§ 508:4(I)-(II).
  3. Property Damage: New Hampshire imposes a three (3) year period of limitations on actions for property damage. N.H. Rev. Stat. § 508:4(I).

Right to Repair Laws and/or Pre-Suit Statutory Procedures

NA

Indemnity and Contribution

  1. One joint tortfeasor has a right to indemnity against another where the indemnitee's liability is derivative or imputed by law or where an express or implied duty to indemnify exists. Jaswell Drill Corp. v. General Motors Corp., 529 A.2d 875, 878 (N.H. 1987).
  2. In interpreting indemnity provisions the same rules apply as are used to interpret contracts generally. “[E]xpress language is not necessary to obligate a contractor to protect against injuries resulting from the owner's negligence where the parties' intention to afford such protection is clearly evident.” Commercial Union Assurance Co. v. Brown Co., 419 A.2d 1111, 1113 (N.H. 1980).
  3. There can be an “implied right to indemnity” arising from a contract when the indemnitor negligently performs a service for the indemnitee which caused harm to a third-party. See Sears, Roebuck & Co. v. Philip, 294 A.2d 211 (N. H.1972); Wentworth Hotel v. Gray, Inc., 272 A.2d 583 (N. H. 1970). “The rationale for finding an implied agreement to indemnify in that situation is based on ‘the fault of the indemnitor as the source of indemnitee's liability … and, conversely, the indemnitee's freedom from fault in bringing about the dangerous condition.’” Jaswell 7 Drill Corp. v. General Motors Corp., 529 A.2d 875, 878 (N.H. 1987).
  4. In New Hampshire, exculpatory contracts are generally prohibited, subject to certain exceptions. “A defendant seeking to avoid liability must show that the exculpatory agreement does not contravene public policy; i.e., that no special relationship existed between the parties and that there was no other disparity in bargaining power.” Barnes v. N.H. Karting Assoc., 509 A.2d 151 (N.H. 1986).
  5. Even if it is found that the exculpatory contract does not violate public policy, it will only be upheld if the plaintiff understood the import of the agreement or a reasonable person in his position would have understood the import of the agreement; and the plaintiff's claims were within the contemplation of the parties when they executed the contract. See Barnes v. N.H. Karting Assoc., 509 A.2d 151 (N.H. 1986).

Certificate of Merit – Experts

NA

Economic Loss Doctrine

Generally speaking, the State of New Hampshire has adopted the economic loss doctrine. “The economic loss doctrine is a ‘judicially-created remedies principle that operates generally to preclude contracting parties from pursuing tort recovery for purely economic or commercial losses associated with the contract relationship.’” Wyle v. Lees, 162 N.H. 406, 409-10 (quoting Plourde Sand & Gravel v. JGI Eastern, 154 N.H. 791, 794 (2007).

Contractor Licensing Requirements

http://www.licensetobuild.com/state-requirements/new-hampshire-state-licensing-requirements/

Common Law & Statutory Claims

Consumer Protection/Fraud Statute

  1. N.H. Rev. Stat. § 358-A: N.H. Rev. Stat. § 358-A:2 (effective until July 1, 2017) provides that “[i]t shall be unlawful for any person to use any unfair method of competition or any unfair or deceptive act or practice in the conduct of any trade or commerce within this state.” Unlike M.G.L. c. 93A, however, N.H. Rev. Stat. § 358-A does not apply to the activities of insurance companies. N.H. Rev. Stat § 358-A:3.
  2. N.H. Rev. Stat. § 417:3: N.H. Rev. Stat. § 417:3 provides that “[n]o person shall engage in this state in any trade practice which is defined in this chapter or determined pursuant to this chapter as an unfair method of competition or an unfair or deceptive act or practice in the business of insurance.”
  3. N.H. Rev. Stat. § 417:4: N.H. Rev. Stat. § 417:4 provides an extensive list of unfair methods of competition and unfair and deceptive acts and practices in the business of insurance.

Construction Damages

Cost of Repair

In breach of contract cases, the purpose of awarding damages is not merely to restore the plaintiff to his former position, but to give him the benefit of his bargain to put him in the position he would have been in if the contract had been fulfilled. Emery v. Caledonia Sand and Gravel Co., 117 N.H. 441, 446, 374 A.2d 929, 933 (1977). When a contractor breaches his agreement by defective performance, the ordinary measure of damages is the cost of remedying the defective work. M. W. Goodell Constr. Co. v. Monadnock Skating Club, 121 N.H. 320 (1981).

Diminution in Value

While the ordinary measure of damages is the cost of repair, that amount "may be withheld if 'physical reconstruction and completion in accordance with the contract [would] involve unreasonable economic waste by destruction of usable property or otherwise.'" In that case, the injured party may be awarded the difference between the value the building would have had if constructed as promised and its value as actually constructed. Danforth v. Freeman, 69 N.H. 466, 468-69, 43 A. 621, 622-23 (1898); Restatement of Contracts § 346(a) (1932); J. Calamari & J. Perillo, The Law of Contracts § 230 (1970).

Punitive Damages

Punitive damages are not allowed in New Hampshire. See Vratsenes v. N.H. Auto, Inc., 289 A.2d 66 (N.H. 1972).

Attorney’s Fees

Absent statutory exceptions or an express contractual provision, a party bears his own attorney’s fees. Exceptions to this general rule include cases where “litigation has been instituted or unnecessarily prolonged through a party’s oppressive, vexatious, arbitrary, capricious or bad faith conduct.” Harkeem v. Adams, 377 A.2d 617 (N.H. 1977). Attorney’s fees can also be awarded for frivolous or unreasonable conduct. See Funtown USA, Inc. v. Town of Conway, 529 A.2d 882 (N.H. 1987).

Joint and Several Liability (specific to construction)

Joint and Several Liability except when a party is less than 50% at fault, in which case that party’s liability is several and limited to its share of fault.

Cost Incurred to Access Repair Areas

Consequential Damages

Consequential damages are available if plaintiff can prove that such damages were sustained as a result of the defendant’s breach and were reasonably foreseeable by the defendant at the time the contract was formed and that he could not have reasonably avoided or mitigated such damages. Drop Anchor Realty Trust v. Hartford Fire Ins. Co., 496 A.2d 339 (N.H. 1985). Recoverable consequential damages may include lost profits if there is sufficient proof that profits were reasonably certain to result in the absence of the breach. Independent Mechanical Contractors, Inc. v. Gordon T. Burke & Sons, Inc., 635 A.2d 487, 490 (N.H. 1993).

Coverage Trigger of Coverage

Definition of an Occurrence

The standard New Hampshire general liability policy defines “occurrence” as “an accident, including continuous or repeated exposure to conditions which results in bodily injury or property damage neither expected nor intended from the standpoint of the insured.” The Supreme Court of New Hampshire has noted that drafting history of standard general liability policies issued in New Hampshire leaves “little doubt that the definition of ‘occurrence’ . . . was intended to provide coverage when damage or injury resulting from an accident or ‘injurious exposure to conditions’ occurs during the policy period.” Energynorth Natural Gas, Inc. v. Underwriters at Lloyds, 150 N.H. 828, 835 (2004).

New Hampshire follows the “injury-in-fact” test for determining the triggering of coverage under a general liability policy. Energynorth Natural Gas, Inc. v. Underwriters at Lloyd’s, 150 N.H. 828, 836 (2004).

Duty to Defend

  1. Contractual Indemnity: Under New Hampshire law, the duty to indemnify is narrower than the duty to defend. The duty to indemnify arises once liability has been conclusively determined. Ross v. Home Ins. Co., 146 N.H. 468 (2001).
  2. Anti-Indemnity Statutes:
    1. N.H. Rev. Stat. § 358-A:2 (XIV): “Any agreement or provision whereby an architect, engineer, surveyor or his agents or employees is sought to be held harmless or indemnified for damages and claims arising out of circumstances giving rise to legal liability by reason of negligence on the part of any said persons shall be against public policy, void and wholly unenforceable.”
    2. N.H. Rev. Stat. § 338-A:2: “Any provision for or in connection with a contract for construction, reconstruction, installation, alteration, remodeling, repair, demolition, or maintenance work, including without limitation, excavation, backfilling or grading, on any building or structure, whether underground or above ground, or on any real property, including without limitation any road, bridge, tunnel, sewer, water, or other utility line, which requires any party to indemnify any person or entity for injury to persons or damage to property not caused by the party or its employees, agents, or subcontractors, shall be void.”
  3. Additional Insureds
    1. Coverage for AI’s own negligence vs. vicarious liability for Named Insured
    2. Determining Primary and Non-Contributory vs. Excess Position
      • A New Hampshire court will look to the language of the policies to determine primary versus excess coverage. “Trial court properly determined issue of primary versus excess insurance coverage, giving controlling effect to the other insurance endorsement in one policy, thereby making that policy excess and the other policy primary.” Ellis v. Royal Ins. Co., 129 N.H. 326 (1987).

    3. AI carrier’s rights to reimbursement for defense expenses from other, co-primary carriers
      • Generally, carriers will share defense costs with other co-primary carriers. “Because both policies afford primary coverage, the insurance companies had a joint obligation to defend the insured and to share equally the costs of defense." Liberty Mutual, 116 N.H. 12 (1976)

  4. Insureds Right to Independent Counsel and Consequences of Rejecting a Defense
    • If a conflict of interest exists between the insurer and the insured, the insurer cannot control the insured’s defense. “Having a duty to defend, and faced with a conflict of interest, the insurer could have hired independent counsel to defend the insured while intervening on its own behalf. In the alternative, the insurer could have provided the defense but reserved its right to later deny coverage.” White Mountain Cable Constr. Corp. v. Transamerica Ins. Co., 137 N.H. 478 (1993).

Coverage Defenses

Generally speaking, if an insured gives late notice to the insurer, the insurer must show that it was prejudiced in order to deny coverage. Bates v. Vermont Mut. Ins. Co., 157 N.H. 391, 396 (2008).

“Business Risk” Exclusions: The Supreme Court of New Hampshire has enforced the applicability of the “business risk” exclusions. The court has, however, contemplated some limit to the exclusionary effect of the “your work” exclusion. In Brown v. Concord Group Ins. Co., 163 N.H. 522 (2012), the court observed that: “[Y]our work” does have a limitation in that it contemplates discrete jobs that have an endpoint. Indeed, the policy provides a detailed explanation of when “your work” shall be deemed completed. Although this explanation is contained in the “products-completed operations hazard” definition and not in the “your work” definition, it is nevertheless germane to the meaning of “your work” because the “products-completed operations hazard” is an explicit element of the exclusion itself. We thus hold that the “your work” exclusion does not uniformly apply to all work ever performed by “you,” but rather excludes coverage on a job-by-job basis, with individual jobs being demarcated by their completion as explained in the “products-completed operations hazard.” Accordingly, the “your work” exclusion does not necessarily exclude coverage in a situation where an insured's work causes damage to something the insured had previously constructed. If the previous work has been completed, then it is not part of the “work” at issue—the current work that caused the damage to the previous work—and thus the damage would not be excluded under the “your work” exclusion. Id. at 526.

Choice of Law (Forum Selection Clauses)

New Hampshire has, by statute, sanctioned the enforcement of forum selection clauses provided that the parties have agreed in writing that an action shall be brought only in another state, subject to certain exceptions also enumerated in statute. N.H. Rev. Stat. Ann. § 508-A:3.

Targeted Tenders

NA

Consent Judgments

NA

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