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Bar Journal - September 1, 2003

Lex Loci: A Survey of New Hampshire Supreme Court Decisions


Among the many significant decisions issued by our Supreme Court in the past few months is a very important sexual harassment opinion, Madeja v. MPB Corporation d/b/a Split Ballbearing, opinion issued April 23, 2003. The issue before the Court was co-worker sexual harassment. The defendant employer was hit in the superior court by a jury verdict in favor of the plaintiff employee for compensatory damages plus $350,000 in punitive damages for her Title VII claims under the Civil Rights Act of 1964. The Supreme Court had under consideration both the Title VII provisions, as well as New Hampshire's own sexual harassment statute, RSA 354-A.

A unanimous Court, speaking through Chief Justice Brock, carefully waded through many knotty issues. Having before it a case of first impression, the Court relied on cases developed under Title VII to aid its analysis of RSA 354-A. The Court first adopted for New Hampshire the federal rule that "employer liability for co-worker sexual harassment may be predicated upon its negligence with respect to both the discovery of and remedy for co-worker sexual harassment."

Turning next to the plaintiff's claims of retaliation, the Court adopted the majority federal rule

that actions falling short of ultimate employment decisions, such as tolerating co-worker retaliation, may constitute adverse employment actions under certain circumstances. As with a claim of co-worker sexual harassment, a plaintiff claiming co-worker retaliatory harassment must show that the harassment was sufficiently severe and pervasive to alter the terms and conditions of her employment....As with other kinds of 'adverse employment actions,' the plaintiff must also show that there is a causal connection between the co-worker harassment and the plaintiff's protected activity.

On the issue of whether the employer itself had committed sexual harassment since it had made an attempt to investigate the claims of the plaintiff, the Court held "that a reasonable jury could have concluded that the defendant neither adequately investigated nor remedied the harassment of which the plaintiff complained." Concerning the punitive damage award, although New Hampshire does not generally allow punitive damages, punitive damages under Title VII are allowable, with a cap of $300,000. The jury awarded damages of $350,000 which the trial court reduced it in accordance with the statutory cap to $300,000. The Supreme Court held that there was sufficient evidence to support the punitive damage award since there was evidence for a jury to conclude that the defendant employer was not serious in enforcing its sexual harassment policy. Furthermore, the Court rejected the defendant's claim that the punitive damages were unconstitutional because the punitive damages were grossly excessive. Relying on federal precedence, the Court held that the damage award met with the federal three-prong test, "(1)the degree of reprehensibility of the defendant's conduct; (2) the ratio of punitive damages to compensatory damages; and (3) the difference between the punitive damages award and the civil penalties authorized or imposed in comparable cases."1 This significant decision is a caveat to all employers to review their sexual harassment policies and, most importantly, the actual implementation of those policies by their officials since the facts in this matter were murky and the defendant employer did make some efforts to address the sexual harassment claim. However, it is clear that juries are unforgiving concerning employers' mixed responses to these sorts of situations.

The Court had before it recently a series of important cases concerning child support. In The Matter of Watterworth, opinion issued April 30, 2003, the Court ruled that under the child support guidelines established by RSA 458-C, the obligor's gross income for calculation of child support obligations can be lowered by mandatory retirement contributions, but not by discretionary contributions to retirement plans, such as 401(k)'s and IRA's. In The Matter of Folley, opinion issued April 23, 2003, the Court had before it the issue of the proper amount of child support in split or shared custody arrangements. The Supreme Court ruled that the amount of child support was not necessarily directly proportional to the amount of custodial time given to each parent, but rather, the trial court had broad discretion to "account for the financial circumstances and income of each party."

Compare that decision with the child support case of In The Matter of Plaisted, opinion issued May 16, 2003, where a split Supreme Court held that it was error for the trial court to deviate from the child support guidelines of chapter 458-C by considering assets (as distinguished from income) of a party when calculating child support. In another child support case, In The Matter of Breault, opinion issued April 22, 2003, the Court made clear that although RSA 458:35-c provides that child support normally ends when a child reaches the age of eighteen, or graduates from high school, whichever is later, a trial court "may order the parties to contribute to the costs of post-secondary education and/or may order the non-custodial parent to continue paying child support to the custodial parent, if doing so 'is equitable in light of the circumstances of all of the parties.'"

In State v. Tracie Rollins-Ercolino, opinion issued April 18, 2003, the Court answered "recurring questions about the validity of our vehicular assault statute, RSA 265:79-a," which creates a class A misdemeanor for any person who, "without intent," causes death or serious bodily injury to another while using a vessel or propelled vehicle. A unanimous Court first found that "under the plain language of the statute the term 'without intent' relates only to the ultimate harm resulting from the collision caused by a person's unlawful operation of a vessel or motor vehicle," and, thus, did not literally mean that an individual could be found guilty without having any criminal intent. Rather, the Court construed RSA 265:79-a together with the general requirement found in RSA 626:2, which requires a finding of culpable mental state in criminal cases, and found that intent (a culpable mental state) was required under RSA 265:79-a. The Court went on to hold that the culpable mental state required under this statute was the least mental state: a culpable mental state of criminal negligence. RSA 626:2, II(d). [See article on this ruling on page 347.]

Big League Entertainment, Inc. v. Brox Industries, Inc., opinion issued May 5, 2003, presented an opportunity for the Court to distinguish between statutes of limitation and statutes of repose. The case involved a defectively installed septic system and the Court had before it competing statutes: the three-year general statute of limitations of RSA 508:4, I, and the eight-year statute of limitations of RSA 508:4-b, I. The latter statute provides that all actions to recover damages to property or to the person "arising out of any deficiency in the creation of an improvement to real property" "shall be brought within 8 years from the date of substantial completion of the improvement, and not thereafter." The Court described these types of statutes as statutes of repose which "create time limitations which are not measured from the date of injury, but rather 'usually run[] from an act of a defendant....They extinguish a cause of action after a fixed period of time regardless of when the action accrues," and "operate as a grant of immunity serving primarily to relieve potential defendants from anxiety over liability for acts committed long ago." The main purpose of a general statute of limitations, said the Court, is the prevention of stale claims, serving as instruments of public policy and court management, which do not confer upon defendants any right to be free from liability, although this may be their effect.

In the present case, the plaintiff brought his action within the eight-year limitation of RSA 508:4-b, I, but questionably not within the three-year statute. The Court held that the plaintiff's claim "must have been filed within three years of the accrual of the cause of action, but no later than eight years after a substantial completion" of the septic system. The Court remanded the case to the superior court to determine whether or not the plaintiff had met the three- year rule in the ambiguous circumstances presented to it.

The curious practice of the City of Manchester Police Department to take consensual photographs of individuals who are subjected to police stops was before the Court in New Hampshire Civil Liberties Union v. City of Manchester, opinion issued April 30, 2003. The photographs at issue were of people who were stopped by Manchester police officers, who were not arrested, but who gave their consent to be photographed when requested to do so. [Why would anyone so consent?]. The plaintiff, New Hampshire Civil Liberties Union (NHCLU), made a request under the Right-to-Know law for access to the photographs and the department refused. The lower court ordered their release and the Supreme Court affirmed, holding that the photographs were subject to disclosure under the Right-to-Know law, concluding that "the city had failed to meet its heavy burden of shifting the balance toward nondisclosure in this case. Any privacy interest in the photographs at issue does not outweigh the public's interest in disclosure."

Two decisions can be briefly noted. In the first, State v. Foote, opinion issued April 18, 2003, the Court held that a waiver of a jury trial in a misdemeanor case does not require a personally executed waiver or a colloquy between the judge and the defendant, but that the defendant's attorney's signature on a jury waiver form was sufficient. In State v. Coombs, opinion issued April 16, 2003, the Court made clear that in a DWI case where a criminal test other than a breath test is done, the statute, RSA 265:84, only requires the State, upon request, to make available for trial the "certifying scientist," not the actual analyst who conducted the test.

In The Matter of Nelson and Horsley, opinion issued June 6, 2003, a split Supreme Court wrestled with the issue of whether a court may grant custodial rights to an unrelated third person over the express objections of the child's parent. In the complicated situation addressed by the Court, it appeared that the petitioner had had a "romantic relationship" with the mother of the child at issue which she had adopted. The parties never married but did have a biological child, but the petitioner, despite the mother's repeated requests, refused to adopt the child which she had adopted, although he did share some of the child care responsibilities and provided minimal financial support for all of the mother's children, including the adopted child at issue. After the parties' romantic relationship had ended, the mother terminated the petitioner's visitation rights and the petitioner sought custody of the parties' biological child as well as the adopted child at issue. Thus, the petitioner was neither the biological father nor the adoptive father of the adopted child, but had an arguably in loco parentis status as to the child. The Court majority, speaking through Justice Dalianis, ruled that it violated the State Constitution to grant custodial rights to an unrelated third party over the express objection of the minor child's sole parent, although the majority agreed that stepparents had been earlier found by the Court to be an exception to that blanket prohibition.2 This exception did not help the petitioner since he had never married the mother. Justice Nadeau filed a very interesting dissent, much longer than the Court's majority opinion. Justice Nadeau would reject the majorities "categorical approach" and would rule "that the superior court can, under certain circumstances, grant custodial rights to an unrelated third party over the minor children's sole natural or adoptive parent's objection." Justice Nadeau would not take the absolute line of the majority but would find that an in loco parentis person could seek "custodial or visitation rights contrary to the wishes of the natural or adoptive parent [if he/she] bear[s] the burden of proving that such custody or visitation is in the best interests of the child because 'there is a presumption that fit parents act in the best interests of their children." Justice Nadeau's dissent is written almost as if it were intended as the majority opinion [?] and his careful argument persuaded the author that his was the correct approach.

In an important license suspension case, Jacobs v. Director, N.H. Division of Motor Vehicles, opinion issued May 16, 2003, the majority of a split Court upheld its 2000 decision in Lopez v. Director3 where it held that it was not necessary in a license suspension case for the State to prove the lawfulness of the underlying traffic stop, nor even that there was a criminally valid arrest. The trial court had distinguished the Lopez Case, and the Court reversed the trial court's actions in considering the validity of the underlying traffic stop and the trial court's finding that the Division had improperly found an adverse inference from the driver's failure to testify at the license suspension hearing. This brought a vehement dissent from Chief Justice Brock who pointed out that the Lopez Case was wrongfully decided because

Under Lopez, an unconstitutional traffic stop...can form the basis for a lengthy license suspension. In the past we have recognized that the privilege of holding a driver's license is a legally protected interest requiring due process prior to suspension....The New Hampshire Constitution should be interpreted to protect our citizens' strong right of privacy and their legally protected interest in driver's licenses by preventing license suspension after an unconstitutional search or seizure.

Well, you can't say it more strongly than that!

The seldom encountered issue of the availability of rescission of an insurance policy for fraud was before the Court in Mooney v. Nationwide Mutual Insurance Co., opinion issued April 22, 2003. The facts were simple. The plaintiff insured procured an insurance policy from the defendant company covering three automobiles, all of which he represented were for personal use. When he applied for the policy, the plaintiff informed the defendant that he worked for the United States Postal Service in a management position, while, in fact, he was actually a rural mail deliverer and used the insured vehicles to deliver mail. An accident ensued in which the plaintiff was hit by a hit and run driver and badly injured. He sought to recover under the uninsured motorist provisions of his policy but found himself hoisted on his own petard. The defendant insurance company petitioned for rescission of the policy and the trial court granted the defendant's petition on the grounds that the plaintiff had materially misrepresented the use to which he put the vehicle. The Supreme Court unanimously upheld the trial court's rescission of the policy, even though a "trial court should grant [rescission] only 'when in all the circumstances it appears right and just to the parties to do so.'" The Court found that the defendant had met its burden, ruling that it agreed "with the trial court that while rescission caused the plaintiff to suffer hardship, the hardship was not 'undue' under the circumstances of this case."

Turning next to the plaintiff's final argument that it was against public policy to allow the company to avoid coverage for the compulsory uninsured motorist insurance required by state law, the Court held that although "an insurer cannot avoid coverage under a compulsory insurance or financial responsibility law because of fraud when the claimant is an innocent third party....the same public policy considerations are not present when the claimant is the person who procured the insurance through fraud."

Finally, it appears that a presumably endangered species found across America are fraternal clubs such as Elks, Eagles, Lions and Mooses [Meese?], et al, which once flourished across our land. An amusing case illustrating this trend is Franklin Lodge of Elks v. Marcoux, opinion issued June 13, 2003. This case was an appeal from the New Hampshire Commission for Human Rights to the superior court which had awarded the petitioners, three women, compensatory damages for the defendant Lodge's discrimination against them by refusing them admission to membership. It appeared that the Franklin Lodge of Elks had 622 members, none of whom was a woman, even though it was located in a community with a population of more than 8,000 people. The Lodge is a local chapter of a nationwide benevolent organization which raised money to donate to various charities, which it did so by conducting bingo games, operating a bar and grill, and leasing its premises for private functions. The Lodge's budget was $148,000 while membership dues only brought in $30,000, so that the Lodge's financial survival depended on revenue generated from its various commercial activities, such as the bingo games it ran and its bar and grill which served members of the public. The Lodge did have a "women's auxiliary" organization, the Emblem Club, which also helped the Lodge with its fundraising. The petitioners were members of the Emblem Club who, presumably tired of their second class status [tired of doing the dishes?], unsuccessfully sought full membership in the Club.

The Lodge did not deny that it had rejected the three plaintiff applicants from membership because they were females, but claimed rather that it was a distinctly private organization and could, therefore, discriminate in choosing its members. The Human Rights Commission had found that the Lodge was a place of public accommodation and awarded each of the three petitioners $10,000 in compensatory damages, along with reasonable attorney's fees and costs, and the Lodge was ordered to pay $24,000 in administrative fines. This was hardly chicken feed for the Elks.

The Court, speaking unanimously through Justice Broderick, first addressed the privacy issue, which itself turned on whether the Elks was a place of public accommodation. The Court ruled that whether or not a membership organization constitutes a place of public accommodation rather than an exempt private entity involved at least eight or more different factors. The Court first turned to the essential issue, whether the organization was truly selective in its membership, i.e., whether it was truly exclusive. Noting that anyone who was a citizen of the United States, who believed in God, who was 21 years of age and of good character, and not a Communist, was eligible for membership. The Court pointed out that it did not appear that excluding Communists and requiring United States citizenship presented much of a barrier to the pool of candidates from the Franklin area, and upheld "the findings made by the commission [which] conclusively demonstrate that the Lodge maintains an inclusive and expansive practice of admitting applicants to membership."

On the issue of compensatory damages awarded to the petitioners for emotional harm, the Court found that it was clear that the unlawful discrimination in this case was clearly intentional, pointing out that many male Elk Club members (bulls?) explained their vote against admitting the three petitioners because the Elks was a "man's club" and had voted against female applicants because women "wanted to take control and 'run the lodge.'" This case is a "bugle call," so to speak, for fraternal clubs to look to their membership procedures. As modern service clubs, such as Rotary, have found, the addition of women to membership in formerly all male clubs has added greatly to the vitality of these organizations.



BMW, 517 U.S. 559 (1996).


Bodwell v. Brooks, 141 N.H. 508 (1996).


145 N.H. 222 (2000).

The Author

Attorney Charles A. DeGrandpre is a director and treasurer in the firm of McLane, Graf, Raulerson & Middleton, P.A., Portsmouth, New Hampshire.



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