Morgenroth & Associates, Inc. v. State

• Decision Date: 20 March 1985
• Docket Number: No. 83-462,83-462
• Citation: 126 N.H. 266,490 A.2d 784
• Parties: MORGENROTH & ASSOCIATES, INC. v. The STATE of New Hampshire. TOWNS OF TILTON AND NORTHFIELD v. The STATE of New Hampshire.
• Court: New Hampshire Supreme Court

Page 784

490 A.2d 784

126 N.H. 266

MORGENROTH & ASSOCIATES, INC. v. The STATE of New Hampshire.

TOWNS OF TILTON AND NORTHFIELD v. The STATE of New Hampshire.

No. 83-462.

Supreme Court of New Hampshire.

March 20, 1985.

Stanton E. Tefft, of Bedford, orally, for plaintiffs Town of Tilton, Town of Northfield and Morgenroth & Associates, Inc.

Gregory H. Smith, Atty. Gen. (Eve H. Oyer, Asst. Atty. Gen., on brief and orally), for the State.

SOUTER, Justice.

The plaintiffs appeal a ruling of the Superior Court (Cann, J.) that a default judgment in the superior court entered against the plaintiff Morgenroth in Morgenroth & Associates, Inc. v. State of New Hampshire bars the present claims. We affirm in the case first captioned above and reverse in the second.

An appeal of that earlier case to this court was one of three cases decided in Morgenroth & Assoc's, Inc. v. Town of Tilton, 121 N.H. 511, 431 A.2d 770 (1981). We refer to that opinion for a full statement of the facts up to that time. It is sufficient here to note that Morgenroth had brought actions against the towns of Tilton and Northfield to recover charges for Morgenroth's preparation of engineering plans for sewage treatment systems in those towns. Morgenroth had proceeded against the State as well, alleging in effect that the State had obtained the benefit of the engineering plans in the course of discharging its responsibilities to provide and operate sewage and waste disposal facilities for the Winnipesaukee river basin, which included the two towns. See RSA chapter 149-G (1977 and Supp.1983).

In that appeal we held generally that RSA 491:8 abrogates the sovereign immunity of the State in actions based on express contracts and contracts implied in fact, but does not abrogate such immunity in an action based on a contract implied in law. Morgenroth & Assoc's, Inc. v. Town of Tilton, 121 N.H. at 515-16, 431 A.2d at 772-73. We held that RSA 491:8 did not, however, govern the scope of the municipal immunity of the towns. Id. at 518, 431 A.2d at 774. Since Morgenroth's offer of proof made it clear in any event that it intended to press claims against both the towns and the State based on allegations of contracts implied in fact, we remanded the cases with an order that Morgenroth should have leave to amend its pleadings in order to state such claims. Id. at 517, 431 A.2d at 774.

On remand, the superior court allowed Morgenroth to amend accordingly. Morgenroth and the towns then settled their actions, leaving Morgenroth's action against the State still pending. Although there were in fact two separate actions for liability for the plans originally prepared for the two towns, for simplicity we will hereafter refer to them in the singular, as Case A.

Under the terms of the settlements of the municipal actions in Case A, the towns assigned to Morgenroth whatever rights they had to claim indemnification from the State under RSA 149-G:2 (Supp.1983). Thereafter Morgenroth moved to amend its complaint against the State by adding a new count, which would have alleged that judgments had been entered for Morgenroth in the two municipal actions, but had not been satisfied. The new count would not, however, have alleged that the municipalities had assigned to Morgenroth any rights they might have to seek indemnification from the State. The Superior Court (Cann, J.) denied the motion to amend on the ground, inter alia, that allegations of judgments against the towns were immaterial to Morgenroth's existing claim based on a contract implied in fact with the State. In the same order that rejected the amendment, the court also ordered Morgenroth to answer outstanding interrogatories within thirty days or suffer default.

Seven days after the superior court's order, Morgenroth brought two new actions against the State. In the first one, which we label Case B, Morgenroth repeated essentially the same allegations it had sought to raise in its unsuccessful motion to amend the pleadings in Case A. Morgenroth began the second new action, which we label Case C, in the name of the two towns. The declaration in Case C began by repeating some earlier allegations: that the towns had engaged Morgenroth to prepare engineering plans, that Morgenroth had produced them, and that the State had then acquired such plans when it "acquired, planned, constructed and operated a sewage and waste control facility serving [the] towns." The allegations continued by asserting that Morgenroth had obtained judgments against the towns, which the towns had not paid. The declaration then alleged new matter, that the towns had assigned to Morgenroth their rights under RSA 149-G:2 (Supp.1983) to require the State to pay the judgments against them.

RSA 149-G:2 (Supp.1983) provides, inter alia, that certain payments due from a municipality in the Winnipesaukee river basin...