66 A.3d 138
N.H.2013Background
- The Sunapee Difference, LLC (Sunapee) sues the State of New Hampshire for breach of contract, estoppel, promissory estoppel, implied covenant of good faith and fair dealing, reformation, and inverse condemnation related to Mount Sunapee ski area lease.
- RFP process in 1997–1998 created a lease arrangement; the final lease lacked a provided metes-and-bounds description at signing.
- An after-the-fact map/description showed lease boundaries not coterminous with the state park; the buffer area remained.
- Sunapee argued the State’s agents promised coterminous boundaries and later failed to correct the boundary; Sunapee believed the lease would expand east but pursued western expansion.
- Sunapee assigned the lease to CNL Income Mount Sunapee, LLC (CNL); a release from the assignee included some language about resolving claims, but Sunapee’s reformation claim remained at issue.
- The trial court granted summary judgment on most issues; Sunapee sought standing to pursue reformation, which the trial court found; on remand, the court allowed standing and Sunapee’s reformation claim; the State appealed and the court ultimately affirmed in part, reversed in part, vacated in part, and remanded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to sue for reformation | Sunapee retained a contractual interest via sublease and rights such as right of first offer. | After assignment to CNL, Sunapee lacked privity and thus standing; the Release excluded Sunapee’s reformation claim. | Sunapee has standing to pursue reformation. |
| Whether the Lease ambiguity requires different interpretation (Governor vs. Governor and Council) | Paragraph 27 is ambiguous and requires submission to the Governor and Executive Council. | Paragraph 27 aligns with RSA 4:40 and does not require Council submission if the Governor opposes. | Paragraph 27 is ambiguous; the Court interprets to align with RSA 4:40 and holds no automatic Council submission when Governor does not approve. |
| Expansion rights under the Lease | There was an implied or promised right to expand; Lease language and extrinsic evidence support expansion rights. | No express or implied right to expansion in the Lease. | No express or implied right to expansion found in the Lease. |
| Estoppel about lease boundaries | State officials knowingly stated boundaries coterminous with the state park and caused reliance by Sunapee. | Agency statements were unauthorized; reliance was unreasonable given statutory limits; government estoppel not available. | Genuine issues of material fact exist; estoppel is not barred at summary judgment. |
| Reformation claim proof standard | Fraud/misrepresentation by State agents allowed reformation despite Governor/Council’s later actions. | Mutual mistake required; Governor and Council did not share misapprehension. | Reformation claim survives summary judgment; trial on merits warranted. |
Key Cases Cited
- Libertarian Party of N.H. v. Sec’y of State, 158 N.H. 194 (2008) (standing inquiry focuses on injury-in-fact and statutory framework)
- Birch Broad., v. Capitol Broad. Corp., 161 N.H. 192 (2010) (standing and assignment interplay; contract rights retained can confer standing)
- City of Concord v. Tompkins, 124 N.H. 463 (1984) (government estoppel, equity considerations; limits on official authority)
- A.J. Cameron Sod Farms v. Continental Ins. Co., 142 N.H. 275 (1997) (reformation standard; clear and convincing evidence; mutual misunderstanding/misrepresentation)
- Cole v. Lake Co., 54 N.H. 242 (1874) (privity of contract vs. privity of estate; assignment effects on remedies)