Audette v. Cummings
82 A.3d 1269
N.H.2013Background
- Plaintiffs Robert Audette and H&S Construction performed framing work as a subcontractor on a Kingston house and were owed $44,403 when work was ~95% complete.
- Audette engaged defendant accountant/agent Suzynne Cummings (and her firm) in March 2008 via a Representation Letter to collect the debt and to prepare/record a mechanic’s lien and related documents; defendants agreed to be paid hourly.
- Plaintiffs gave Cummings a key to the property and, per her instructions, stopped direct contact with the general contractor (Ledge Rock/Rizzo) and the buyers (the Greenes), referring communications to Cummings.
- Plaintiffs later learned (August 2009) that no mechanic’s lien had been recorded and that the property had been conveyed to the Greenes in July 2008, after the 120-day statutory lien period lapsed.
- Plaintiffs sued for breach of contract; the trial court found defendants failed to perform the Representation Letter, causing plaintiffs’ loss, and awarded $44,403. The defendants appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Failure to mitigate damages | Plaintiffs relied on Cummings' promise and instructions; they had no notice of defendants' inaction until Aug 2009 | Plaintiffs should have accepted payment offers or sued earlier | Court: Plaintiffs did not fail to mitigate; they reasonably relied on defendants and had no duty to mitigate before learning of breach |
| Causation (defendants' breach caused loss) | Defendants promised to secure/record lien and communicate; their inaction allowed lien to lapse, causing loss | Plaintiffs could have collected by returning to job, didn’t prove lien or litigation would have succeeded | Court: Defendants' breach was a substantial factor in causing the loss; lien existed by virtue of work and would have protected priority |
| Requirement to pursue other remedies (sue Rizzo/Greenes) | Not required as a precondition; plaintiffs must show defendants' breach was a substantial factor | Plaintiffs should have sued Rizzo/Greenes or returned to job to collect | Court: No requirement to exhaust collection against Rizzo/Greenes; plaintiffs met burden to show causation |
| Need for expert testimony on liability/causation | Plaintiffs: lay factfinder could determine contract nonperformance and causation | Defendants: expert testimony required on reasonable care/legal causation | Court: Expert testimony not required; issues were within common knowledge regarding contract performance and lien recording |
Key Cases Cited
- Lassonde v. Stanton, 157 N.H. 582 (2008) (breach of contract standard and appellate review)
- Czumak v. N.H. Div. of Developmental Servs., 155 N.H. 368 (2007) (contract interpretation principles)
- Coos Lumber Co. v. Builders Supply Co., 104 N.H. 404 (1963) (mitigation obligation and timing)
- Grenier v. Barclay Square Commercial Condo. Owners’ Assoc., 150 N.H. 111 (2003) (plaintiff burden to mitigate)
- Parem Contracting Corp. v. Welch Const. Co., Inc., 128 N.H. 254 (1986) (defendant bears burden to prove failure to mitigate)
- Flanagan v. Prudhomme, 138 N.H. 561 (1994) (burden on defendant to prove failure to mitigate)
- Robert E. Tardiff, Inc. v. Twin Oaks Realty Trust, 130 N.H. 673 (1988) (goal of contract damages and proving causation/amount)
- Daniel v. Hawkeye Funding Ltd. P’ship, 150 N.H. 581 (2004) (mechanic’s lien arises on performance of work)
- Indep. Mechanical Contractors v. Gordon T. Burke & Sons, 138 N.H. 110 (1993) (substantial-factor standard for causation)
- Boynton v. Figueroa, 154 N.H. 592 (2006) (when expert testimony is required)
- Lewis v. Shawmut Bank, 139 N.H. 50 (1994) (purpose and priority scheme for mechanic’s liens)