2009-919, Birch Broadcasting, Inc. & a. v. Capitol Broadcasting Corporation, Inc. & a.

Following a bench trial in Superior Court (McNamara

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Whittington Law Associates, PLLC Nelson, Kinder, Mosseau & Saturley, P.C. Concord. We affirm. and Nassau Broadcasting I, LLC (Nassau I) for the sale of a radio station in their contract with the plaintiffs, Birch Broadcasting, Inc. (Birch Broadcasting) (Vox Radio), appeal the trial court’s order requiring them to specifically perform Concord Broadcasting, LLC (Concord Broadcasting) and Vox Radio Group, LP the defendants, Capitol Broadcasting Corporation, Inc. (Capitol Broadcasting),

brief and orally), for the defendants.

THE SUPREME COURT OF NEW HAMPSHIRE Díaz Gavin and Kristen M. Jarvis Johnson on the brief), for the plaintiffs. on the brief and orally), and Patton Boggs LLP, of Washington, D.C. (Stephen

CAPITOL BROADCASTING CORPORATION, INC. &.

page is: http://www.courts.state.nh.us/supreme. a.m. on the morning of their release. The direct address of the court's home reporter@courts.state.nh.us. Opinions are available on the Internet by 9:00 to press. Errors may be reported by E-mail at the following address: editorial errors in order that corrections may be made before the opinion goes Hampshire, One Charles Doe Drive, Concord, New Hampshire 03301, of any Readers are requested to notify the Reporter, Supreme Court of New well as formal revision before publication in the New Hampshire Reports. NOTICE: This opinion is subject to motions for rehearing under Rule 22 as p. 2 2009. that he believed that the stock purchase agreement had expired in February and Concord Broadcasting refused to close on the transaction. He also advised and Concord Broadcasting advised plaintiffs’ counsel that Capitol Broadcasting on June 19, 2009. On July 1, 2009, however, counsel for Capitol Broadcasting Broadcasting to Birch Broadcasting. The FCC ultimately approved the transfer FCC approval to transfer control of the radio station from Concord Over the next several months, the parties worked cooperatively to obtain

under which it assigned its rights to Birch Broadcasting. February 26, 2009, Nassau I signed an assignment and assumption agreement amended agreement, Nassau Holdings assigned its rights to Nassau I. On defendants were paid $950,000 of the $1 million purchase price. In the second The agreement was again amended on September 30, 2004, when the

amounts paid to it to the date of termination.” need for action on the part of any party, and Seller shall be entitled to keep any date hereof, the Stock Agreement shall automatically terminate without the pertinent part: “If the Closing has not occurred within five (5) years from the the time for obtaining FCC approval. The amended agreement provided, in On July 16, 2004, the stock purchase agreement was amended to extend

the parties had the right to terminate the agreement. did not become final within one year after the parties applied to the FCC for it, Communications Commission (FCC). The agreement provided that if approval to Nassau Holdings. This transfer required approval from the Federal operate the Concord radio station to be transferred from Capitol Broadcasting Broadcasting’s stock for $1 million. The agreement called for the license to Under the agreement, Nassau Holdings agreed to purchase all of Capitol

Vox Radio is the sole managing member of Concord Broadcasting. Radio; Concord Broadcasting is Capitol Broadcasting’s sole shareholder; and, related companies. Capitol Broadcasting is a wholly-owned subsidiary of Vox Capitol Broadcasting, Concord Broadcasting and Vox Radio are all

Concord. holds a license from the FCC to own and operate radio station WHHK-FM in Nassau Broadcasting Holdings, Inc. (Nassau Holdings). Capitol Broadcasting purchase agreement among Capitol Broadcasting, Concord Broadcasting and record submitted on appeal. This appeal concerns a February 9, 2004 stock The following facts were either found by the trial court or derive from the

I. Background could reasonably disagree as to the meaning of that language.” In the Matter of p. 3 “The language of a contract is ambiguous if the parties to the contract

ambiguous, is ultimately a question of law for this court to decide. Behrens v. The interpretation of a contract, including whether a contract term is Resolving this issue requires that we interpret the parties’ agreements.

A. Breach of Contract Claim

Id in which the agreement was negotiated, and reading the document as a whole. the agreement’s language is ambiguous, it must be determined, under an parties its reasonable meaning, considering the circumstances and the context Taber-McCarthy & McCarthy When interpreting a written agreement, we give the language used by the, 160 N.H. 112, 115 (2010) (quotation omitted). If

(2006) (quotation omitted). Ryan James Realty v. Villages at Chester Condo. Assoc., 153 N.H. 194, 197 determined from the plain meaning of the language used in the contract.” they wrote it. Id. “Absent ambiguity, however, the parties’ intent will be parties executed their original agreement.. at 503. We give an agreement the meaning intended by the parties when the parties’ agreement expired in February 2009 -- five years from the date the agreement had expired by its own terms. Under the defendants’ interpretation, in July 2009 did not breach the parties’ agreement because, by then, the The defendants first argue that their refusal to close on the transaction II. Analysis court’s interpretation of a contract de novo. Id. S.P. Constr. Co., 153 N.H. 498, 500 (2006). Accordingly, we review a trial

We address each argument in turn. specifically upon each of their requests for findings of fact and rulings of law. conclusion of proceedings then currently before the FCC; and (5) failed to rule Radio and Nassau I from the case; (4) declined to defer its decision pending the covenant of good faith and fair dealing; (3) denied their motions to dismiss Vox they breached the parties’ agreement; (2) found that they breached the implied The defendants contend that the trial court erred when it: (1) found that

reasonable period of time. This appeal followed. court ordered the defendants to specifically perform the agreement within a good faith and fair dealing by refusing to close on the transaction. The trial agreement with the plaintiffs and breached the agreement’s implied covenant of basis in December 2009 and found that the defendants breached their performance and other relief. The trial court held a bench trial on an expedited The plaintiffs filed the instant petition on July 16, 2009, seeking specific p. 4 16, 2004. . . . [T]here is no way to tell from the language alone which date was documents -- the one signed on February 9, 2004, and the one signed on July “was no longer a single, stand-alone document; it now consisted of two parties executed the first amended agreement, the stock purchase agreement contract the parties intended to refer. As the plaintiffs explain, when the to the contract,” it is impossible to tell from the language alone to which omitted.) The plaintiffs counter that, while “[t]he word ‘hereof’ obviously refers itself, i.e., February 9, 2004, not the date of the 1 Amendment.” (Emphases st hereof is that ‘date hereof’ refers to the date of the [stock purchase agreement] argue that the “only possible reading of the term five (5) years from the date The parties differ as to the meaning of these terms. The defendants

it to the date of termination. any party, and Seller shall be entitled to keep any amounts paid to automatically terminate without the need for action on the part of years from the date hereof, the Stock Agreement shall “Closing Date”). If the Closing has not occurred within five (5)

Closing

conditions precedent to the parties’ obligations to close (the mutually agreed to by the parties, contingent on satisfaction of all 4

overnight carrier or facsimile, or such other date as shall be

as amended on July 16, 2004, which read: Here, the parties dispute the meaning of section 9.1 of their agreement,

Standard Time) (the “Closing”) by exchange of documents by the FCC’s consent becoming a final order . . . at 10AM (Eastern

Trust v. CC Enterprises, 147 N.H. 137, 141 (2001). supported by the evidence and are not legally erroneous. See N.A.P.P Realty involves factual findings by the trial court to which we will defer if they are people, mutually understood the ambiguous language to mean necessarily Applying an objective standard to determine what the parties, as reasonable regard to the contract is considered as part of the relevant circumstances.”). Helm Corp., 114 N.H. 773, 776 (1974) (“In this State how the parties acted with their actions after the contract was executed.”); Spectrum Enterprises, Inc. v. (1981) (“In determining the parties’ intention, the court may properly consider 124 N.H. 452, 455 (1984); see also Auclair v. Bancroft, 121 N.H. 393, 395 parties and their actions after the contract was executed. See White v. Ford, determinative, those intentions may be inferred from the situation of the the intentions of the parties at the time of the contract’s formation are goal of giving effect to the intentions of the parties. Id. at 115-16. Although execution and the object intended by the agreement, while keeping in mind the court should examine the contract as a whole, the circumstances surrounding understood the ambiguous language to mean. Id. In applying this standard, a objective standard, what the parties, as reasonable people, mutually the July 16, 2004 first amended agreement. p. 5 that the contract would expire by its own terms five years after they executed record supports the trial court’s finding that the parties mutually understood agreement would not expire before July 16, 2009. As discussed above, the common purpose and justified expectations included the expectation that their The record supports the trial court’s finding that the parties’ agreed-upon

evidence or is legally erroneous. Id. covenant of good faith and fair dealing unless it is not supported by the and fairly with one another. Livingston v. 18 Mile Point Drive erroneous, we uphold them. See We will uphold a trial court’s determination regarding the breach of the implied agreement, there is an implied covenant that the parties will act in good faith agreement. As these findings are supported by the evidence and are not legally standards of decency, fairness and reasonableness.” Id they breached the implied covenant of good faith and fair dealing. In every. (quotation omitted). agreement, and not to the date of the parties’ original February 9, 2004 upon common purpose and justified expectations as well as “with common The defendants next assert that the trial court erred when it found that intended the phrase “date hereof” to refer to the July 16, 2004 first amended broader function is to prohibit behavior inconsistent with the parties’ agreed- B. Implied Covenant of Good Faith and Fair Dealing Claim continuing to seek FCC approval after February 2009 demonstrated that they the third category. While the third category is comparatively narrow, its The trial court found that the parties’ subsequent cooperative conduct in (3) limitation of discretion in contractual performance. Id. This case involves (1) contract formation; (2) termination of at-will employment agreements; and Id. The various implied good-faith obligations fall into three general categories: faith duty, but a series of doctrines, each of which serves a different function. 624 (2009). In New Hampshire, there is not merely one rule of implied good-

arguments regarding the trial court’s alternative finding of waiver. its finding as to the meaning of the language, we need not address the parties’ the trial court’s determination that the disputed language was ambiguous and by refusing to close on the transaction in early July 2009. Because we affirm did not err when it found that the defendants breached the parties’ agreement

conclude, therefore, that the language is ambiguous. interpretations assigned to the disputed language are reasonable. We actually began performing on the agreement. We believe that the respective agreement (September 30, 2004), because that was the date the parties interpret the phrase “date hereof” to refer to the date of the second amended intended; either date is possible.” It is equally possible, the plaintiffs assert, to assigned all of its rights under the second amended stock purchase agreement p. 6 insufficient to grant Nassau I standing because, in February 2009, Nassau I

Libertarian Party of N.H. v. Sec’y of State the party suffered a legal injury against which the law was designed to protect.” “In evaluating whether a party has standing to sue, we focus on whether amended stock purchase agreement. The defendants argue that this is because it found that Nassau I had direct standing to sue under the second The trial court denied the defendants’ motion to dismiss Nassau I

1. Nassau I

ordinarily does not include the power to issue advisory opinions. Id. at 195-96. challenge rests upon the constitutional principle that the judicial power omitted). The requirement that a party demonstrate harm to maintain a legal

establish a basis upon which relief may be granted.” Baer v. New Hampshire whether the allegations contained in the plaintiff’s pleading sufficiently 503, 507 (2010). “Generally, in ruling upon a motion to dismiss, the trial court must determine evidence or is legally erroneous. See Atwater v. Town of Plainfield, 160 N.H. their motions to dismiss Nassau I and Vox Radio for lack of standing. court’s ruling in such a case unless its decision is not supported by the The defendants next contend that the trial court erred when it denied based upon lack of standing is one such defense. Id. We will uphold a trial relief.” Id. at ___ (quotation and brackets omitted). A jurisdictional challenge the facts, whether the plaintiff has sufficiently demonstrated his right to claim C. Motion to Dismiss Nassau I and Vox Radio look beyond the plaintiff’s unsubstantiated allegations and determine, based on plaintiff’s legal claim but, instead, raises certain defenses, the trial court must omitted). “When the motion to dismiss does not challenge the sufficiency of the Dep’t of Educ., 160 N.H. ___, ___ (decided September 24, 2010) (quotation

legally erroneous, we uphold it. Id. implied covenant of good faith and fair dealing and that this finding is not the evidence supports the trial court’s finding that the defendants breached the depriving them of the benefit of the parties’ bargain. Because we conclude that the contract, thereby disrupting the plaintiffs’ justified expectations and minute, even though FCC approval had been obtained, they refused to close on months to bring the transaction to a close by July 16 and that, at the last finding that the defendants worked cooperatively with the plaintiffs for many obligations to close on the contract. The record supports the trial court’s implied covenant of good faith and fair dealing, when they abandoned their behaved inconsistently with this expectation and, therefore, breached the The record also supports the trial court’s finding that the defendants p. 7 E. Ruling upon Defendants’ Specific Requests

a party asks for them, when either party does request them, RSA 491:15 under no obligation to make findings and rulings in support of a decree unless held that although a superior court justice sitting without a jury is generally of law, which shall be filed and recorded.” In interpreting RSA 491:15, we have requests it, give his decision in writing, stating the facts found and his rulings of law. RSA 491:15 (2010) provides: “The court . . . shall, if either party to rule specifically upon its individual requests for findings of fact and rulings Finally, the defendants assert that the trial court erred when it declined 7

D. Deferring Decision Until FCC Proceedings Completed ruling. they failed to bring their FCC complaint earlier. We can discern no error in this decision would be inequitable given that the defendants had not shown why FCC rules. The trial court denied the request on the ground that to delay its impermissible ownership interest in Birch Broadcasting, which is contrary to had an opportunity to rule upon whether the Nassau companies have an contend that the trial court should have deferred its decision until the FCC had its decision until certain FCC proceedings had concluded. Specifically, they The defendants next argue that the trial court erred by refusing to defer

assertions, these findings are supported by the evidence, and we uphold them. approval signed on behalf of Vox Radio. Contrary to the defendants’ purchase agreement and that one of the signatories to the application for FCC the grounds that Vox Radio was a direct signatory to the first amended stock The trial court denied the defendants’ motion to dismiss Vox Radio on

2. Vox Radio

this case. We hold that the trial court reasonably concluded to the contrary. purchase agreement is too attenuated to grant Nassau I standing to proceed in their reply brief, the defendants contend that Nassau I’s interest in the stock denying the defendants’ motion to dismiss Nassau I for lack of standing. In denying it these contractual benefits. Therefore, the trial court did not err by defendants’ refusal to close on the transaction caused harm to Nassau I by provisions, the trial court could have reasonably determined that the own an additional radio station in the same market. Based upon these station back from Birch Broadcasting if, at any time, Nassau I is permitted to to the defendants. The agreement also gives Nassau I the right to purchase the a portion of the debt that Nassau I undertook to finance its $950,000 payment provides that, upon closing of the transaction, Birch Broadcasting will assume plaintiffs aptly note, the February 2009 assignment and assumption agreement to Birch Broadcasting and retained no rights for itself. To the contrary, as the p. 8 8

DUGGAN, HICKS and CONBOY, JJ., concurred.

Affirmed

essential rulings of law to support its ultimate decision. See Here, the trial court’s order sets forth both sufficient findings of fact and

appellate review of its decision. See id. Accordingly, the trial court did not fail to provide an adequate basis for every specific request filed by a party.” Id. (quotation and ellipsis omitted). proposed findings and rulings, “the trial judge need not respond expressly to N.H. at p. 8 86. Although the trial court did not rule upon the defendants’

applied. M.A. Crowley Trucking v. Moyers, 140 N.H. 190, 195 (1995). actual basis for the trial court’s decision, in terms of facts found and law allow an opportunity for adequate review in this court by providing us with the the essential rulings of law may be likewise explained. Id. The object is to support the ultimate decision. Id. This may be done in the narrative form, and is obligated to make findings of the basic or essential facts that are sufficient to in such a case need not respond to every request filed by a party, but the court cases. Harrington v. Town of Warner, 152 N.H. 74, p. 8 85 (2005). The trial judge requires a statement of facts and legal rulings in jury-waived and non-jury