CONTRACT LAW

Stacie Ayn Murphy Corcoran
2011 graduate of Suffolk University,
practicing in Mass. and NH

No. 2018-0648

July 11, 2019

Affirmed

  • Issue: Did the court err in granting partial summary judgement to the defendant on the plaintiff’s breach of contract claim.
  • Issue: Did the court err in dismissing the plaintiff’s claim for breach of implied covenant of good faith and fair dealing.

The plaintiff entered into a lease for a condominium with an option to purchase. On May 20, 2016 the plaintiff notified the defendant of their intent to exercise and the defendant declined by letter on May 26, 2016. The plaintiff filed a complaint in September 2016 for breach of contract, breach of implied covenant of good faith and fair dealing and several other causes of action. The court denied the plaintiff and defendant motions for summary judgment and motion to dismiss on the claim for breach of good faith and fair dealing. The court granted the defendant’s motion for partial summary judgement on the breach of contract frame because the May 20th correspondence was not unconditional acceptance of the option agreement. The plaintiff’s failure to properly invoke their option rights led to the court dismissing their claim for breach of implied covenant of good faith and fair dealing.

On appeal, the Court first focused on the breach of contract claim de novo. The option to purchase the condominium was an option contract that “must be absolute, unambiguous, without condition, or reservation and in accordance with the offer made. “State Securities Co. v. Daringer, 293 N.W.2d 102, 105 (Neb. 1980). The Court determined that the purchase and sale placed conditions, making the May 20th correspondence a counter-offer and insufficient to exercise the option to purchase.

Related to the trial court’s dismissal of the plaintiff’s good faith and fair deals claim, the Court found that the trial court’s denial of the amendment raised on appeal was not an “unsustainable exercise of discretion because the amendment would have added a new cause of action, Bel Air Assoc., 154 N.H. at 236, and likewise would have contradicted the plaintiff’s previous arguments that its claims centered only on contract formation.”

Sheehan Phinney Bass & Green of Manchester (James P. Harris and Patrick J. Queenan on the brief and Mr. Harris orally), for the plaintiff. Cleveland, Waters and Bass P.A of Concord (Bryan K. Gould and Cooley A. Arroyo on the brief, and Mr. Gould orally) and Schuster, Buttrey & Wing, of Lebanon (Barry C. Schuster on the brief, for the defendants.