Kessler v. Gleich, 13 A.3d 109

FHBA is a partnership with Gleich as sole general partner and Kessler as a limited partner; FHBA operated a Section 8 housing project financed through NHHFA under regulatory and mortgage instruments requiring an approved managing agent.
NHHFA notified Gleich repeatedly from 1997–2004 of FHBA's failure to have an approved managing agent and warned of foreclosure if noncompliant; foreclosure proceedings began October 1, 2004.
Kessler learned of the foreclosure via his attorney and intervened to enjoin the sale; the foreclosure auction was temporarily enjoined.
In 2004, Kessler sued Gleich for breach of fiduciary duties; the trial court found willful breach of loyalty and the appellate court affirmed on the merits.
After prevailing, Kessler moved for attorney’s fees; the trial court awarded $288,281.20, including $75,406 of NHHFA’s fees in the foreclosure action; Gleich appealed.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether 6.8 requires indemnification for first-party attorney’s fees	Kessler argues 6.8 permits fees arising from fraud/bad faith/gross negligence or willful noncompliance, including litigation between partners.	Gleich contends 6.8 covers third-party claims only, not first-party fee shifting in a dispute between the partners.	Indemnity not limited to third-party actions; but not clearly covering first-party fees here.
Whether Gleich must pay NHHFA’s reasonable attorney’s fees incurred in the foreclosure action	Kessler claims partnership indemnifies for costs incurred defending the partnership obligations; NHHFA’s fees fall within this scope.	NHHFA’s fees are payable by the partnership, not personally by Kessler; the court should enforce the note/mortgage and 6.8.	Trial court’s award of NHHFA fees to Kessler is vacated; partnership not obligated to pay NHHFA’s fees personally.
Remand/clarification on the amount of NHHFA fees	If any fees are ultimately due, they should be determined on remand with proper allocation.	The record is unclear; remand is needed to align with contractual obligations and the court’s ruling.	Remand for proceedings consistent with the opinion to determine eligibility/amount of NHHFA fees.

Newman, 147 N.H. 131 (New Hampshire, 2001) (indemnity language specific to enforcement in a contract action; costs awarded to enforce agreement)
Merrimack School Dist. v. Nat'l School Bus Serv., 140 N.H. 9 (New Hampshire, 1995) (indemnity does not automatically cover attorney’s fees to enforce the agreement; broad loss phrasing not enough)
Hooper Associates v. AGS Computers, 74 N.Y.2d 487 (New York, 1989) (indemnity not clearly extending to first-party fees unless language unmistakably clear)
Dunn v. CLD Paving, 140 N.H. 120 (New Hampshire, 1995) (strict interpretation of indemnity provisions; avoid implying waiver of own fee liability)
Clipper Affiliates v. Checovich, 138 N.H. 271 (New Hampshire, 1994) (indemnity scope generally reserves costs/fees to third-party claims absent clear language)
Newman v. Town, 147 N.H. 132 (New Hampshire, 2001) (illustrative of language specifying action between parties for fee shifting)