Argued: June 6, 2019
Sheehan Phinney Bass & Green, P.A., 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, P.A., of Lebanon (Barry C.
Schuster on the brief), for the defendants.
plaintiff, The Skinny Pancake-Hanover, LLC, appeals decisions
of the Superior Court (Bornstein, J.) that granted
partial summary judgment to the defendants, Crotix and James
and Susan Rubens, on the plaintiff's breach of contract
claim, and that dismissed the plaintiff's claim against
the defendants for breach of the implied covenant of good
faith and fair dealing. We affirm.
relevant facts follow. On October 15, 2015, the plaintiff
entered into a lease with the defendants for a single unit in
the Hanover Park Condominium building. The lease gave the
plaintiff the option to purchase its rental unit along with
certain other units in the building. Specifically, the option
Within the first nine (9) months from Lease Commencement
Date, Tenant shall have the exclusive option to purchase all
Hanover Park Condominium units then owned by Landlord . . .
in AS IS condition for $5, 553, 570 . . . . After 180 days
from Commencement Date, this Purchase Option shall expire if
there is no signed Purchase & Sale Agreement.
20, 2016, the plaintiff sent the defendants a letter to
"give formal notice of Tenant's intent to exercise
its purchase option" under the lease. Included with the
letter was a Purchase and Sale Agreement that provided for
certain conditions to be met prior to closing, including a
90-day due diligence period during which the plaintiff could
perform inspections, and further providing that the plaintiff
may, in its "sole discretion, on or before the
expiration of the Due Diligence Period elect to . . .
terminate [the] Agreement by providing written notice [of]
termination to [the defendants] . . ., in which case all of
the rights and obligations of the parties to [the]
Agreement" would cease and terminate. By letter dated
May 26, 2016, the defendants "declined" the
plaintiff's request, stating that the plaintiff's
attempted exercise of the option was untimely under the terms
of the agreement.
response, on May 28, the plaintiff sent the defendants an
e-mail stating that it was hoping to "avoid a lengthy
argument over this as the evidence is so overwhelmingly in
favor of our position and we are absolutely committed to
whatever means necessary to exercise our option." On
July 19, the plaintiff sent the defendants a letter demanding
that they convey the property, emphasizing that the
defendants were "obligated to sell the Property
upon" the plaintiff's exercise of the option on May
20. The defendants responded by stating that "[t]he
terms of the option to purchase [were] clearly set forth in
the Lease and, in order for [the plaintiff] to benefit from
the terms of that option, it was required to perform
according to those terms."
September 2016, the plaintiff filed a verified complaint in
superior court asserting: (1) breach of contract; (2) breach
of the implied covenant of good faith and fair dealing; (3)
intentional misrepresentation (fraud); (4) negligent
misrepresentation; and (5) violation of the Consumer
Protection Act (CPA), RSA chapter 358-A. According to the
plaintiff, the May 20 letter provided the defendants with
notice of its "intent to exercise its Option to
Purchase" and obligated them to sell the property. In
their answer, the defendants asserted that the May 20
correspondence was insufficient to trigger their obligations
because "[n]either the letter nor the proposed purchase
and sale agreement accepted the terms of the Purchase Option
but offered numerous conditions and terms."
the parties engaged in extensive litigation. First, the
parties cross-moved for summary judgment, which the court
denied because, in its view, there were genuine issues of
fact as to what date constituted the commencement date for
purposes of the agreement, and there also were issues of fact
concerning the plaintiff's good faith and fair dealing
claim. In October 2017, the court denied the defendants'
motion for partial dismissal of the breach of the good faith
and fair dealing claim. In reaching this decision, the court
was guided by the plaintiff's assertion that this claim
was not based on the defendants' performance under the
contract, but rather was based on the defendants' breach
of the covenant during contract formation.
January 2018, the court granted in part the defendants'
second motion to dismiss. The court dismissed the
plaintiff's claims for intentional misrepresentation
(fraud) and for violation of the CPA, but did not dismiss the
claims for breach of the implied covenant of good faith and
fair dealing and for negligent misrepresentation. As to the
good faith and fair dealing claim, the court reiterated that,
as explained by the plaintiff in its objection to the first
motion to dismiss, this claim was predicated on the
defendants' alleged bad faith actions with respect to
contract formation, not contract performance. The court later
denied the plaintiff's motion to amend its complaint to
add allegations of breach of the covenant with respect to the
defendants' performance under the contract. According to
the court, "the proposed amendments would introduce a
new cause of action that the plaintiff ha[d] repeatedly
disclaimed" up until that point and would prejudice the
2018, the court granted the defendants' motion for
partial summary judgment on the plaintiff's breach of
contract claim. The court agreed with the defendants'
argument that no breach occurred because the plaintiff never
properly invoked its option. The court ruled that the
plaintiff's May 20 correspondence was insufficient
because it was not an unconditional acceptance in accordance
with the terms of the option provision of the lease. The
court also rejected the plaintiff's arguments that its
later correspondence operated as an acceptance because these
later demands were "explicitly tethered to the May
20" correspondence. The court reasoned that these later
attempts were "all ineffective because none of them were
unequivocal, unconditional, and in accord with the terms of
the option agreement." The court concluded that the
plaintiff's reliance on Livingston v. 18 Mile Point
Drive, 158 N.H. 619 (2009), was misplaced because that
case "involved a party's breach of a contract's
implied covenant of ...