TAM Dev. Corp. v. Georges Mills Boat Club

• Jurisdiction: New Hampshire,United States
• Parties: TAM Development Corporation & a. v. Georges Mills Boat Club
• Decision Date: 17 April 2024
• Court: New Hampshire Supreme Court
• Docket Number: 2023-0211

1

TAM Development Corporation & a. v. Georges Mills Boat Club

No. 2023-0211

Supreme Court of New Hampshire

April 17, 2024

The court has reviewed the written arguments and the record submitted on appeal, has considered the oral arguments of the parties, and has determined to resolve this case by way of this order.SeeSup. Ct. R. 20(2).The plaintiffsTAM Development Corporation, Thomas Miller, Andrew Miller and Mary Miller(collectively, the Millers), appeal a decision of the Superior Court(Ignatius, J.) granting summary judgment in favor of the defendant, Georges Mills Boat Club (Boat Club).This case arose from a dispute over the allowed length of the Millers' boat under the Boat Club's regulations and bylaws.In their complaint the Millers sought declaratory and injunctive relief, alleged a breach of the duty of good faith and fair dealing, and requested legal fees.We affirm.

We draw the following facts from the trial court's order and the record presented on appeal.Thomas and Mary Miller own a house near Lake Sunapee.In 2011, they joined the Boat Club a voluntary corporation, comprised of 56 memberships, each owning a 1/56 undivided interest in the Boat Club's property.Pursuant to its bylaws, the "maximum length and beam of the boat or vessel that may utilize the assigned slip will be fixed at the date of assignment."The Boat Club assigned the Millers slip #4 on Dock C. Slip #4 permits docking of a boat no larger than 25 feet in length and 8 feet, 6 inches in width (beam).The Millers originally acquired and docked a 23-foot-long pontoon boat in their slip.After the pontoon boat was flooded by a wake boat, the Millers looked for a new boat to purchase.

The Millers purchased a tri-toon boat, which was delivered in March 2019.Three pontoons comprise the body of the tri-toon boat.The manufacturer's statement of origin described the boat's body as 25 feet in length.The middle pontoon juts out past the outer two pontoons by about four inches.The flat deck extends past the rear of the pontoons by about two feet.The motor extends past the deck by about one foot.Overall, the boat measures 27 feet, two inches long and eight feet, six inches wide.In June 2020, when the Millers docked the boat in slip #4, the member assigned to slip #3 complained to the Boat Club's Board of Directors(Board) that the Millers' boat was too big.After inspecting the boat, the Board sent the Millers a violation letter due to the size of the boat.The Board met with the Millers and counsel to resolve the dispute.They were unsuccessful.

In December 2020, the Boat Club amended its rules to require written documentation showing the make, model, width, and length before buying a new boat or modifying an existing boat in a manner that may increase its length or width.The amended rule also specified that the Boat Club would measure the length of a boat "from the farthest forward point of its bow to the farthest rearward point of its stern" excluding readily detachable features.

In March 2021, the Board notified the Millers that their boat could not be docked in slip #4.The Millers sued.They sought a declaratory judgment that the Board's actions were inconsistent with its governing documents, and alleged a breach of the contract-based covenant of good faith and fair dealing.The Boat Club moved for summary judgment, which the trial court granted.The trial court denied the Millers' motion for reconsideration.This appeal followed.

II

Our standard of review for matters decided at summary judgment requires that we review de novothe trial court's application of the law to the facts.Brown v. Concord Group Ins. Co., 163 N.H. 522, 524-25(2012).We consider all the evidence presented in the record and all inferences properly drawn therefrom in the light most favorable to the non-moving party.Id. at 525.If our review of that evidence discloses no genuine issue of material fact and if the moving party is entitled to judgment as a matter of law, then we will affirm the grant of summary judgment.Id.A fact is material if it affects the outcome of the litigation under the applicable substantive law.Id.

A corporation's bylaws are a contract.SeeGrand Lodge v. Union Lodge, 111 N.H. 241, 244(1971)(bylaws can constitute contractual obligations);cf.Barclay Square Condominium Owners' Ass'n v. Grenier, 153 N.H. 514, 517(2006).The interpretation of a contract, including whether a contract term is ambiguous, is ultimately a question of law for this court to decide.Short v. LaPlante, 174 N.H. 384, 387(2021).

III

The heart of this appeal is the meaning of the term "length" in the Boat Club's bylaws, prior to the 2020 ruleamendment, and its application to the Millers' boat.The Millers argue that the term "length" was ambiguous prior to the 2020amendment because the Boat Club neither defined it nor established a measurement method.The Boat Club responds that the term is not ambiguous, despite the later amendment to clarify how to calculate the measurement.Alternatively, the Boat Club asserts that, if the term is ambiguous, the trial court properly interpreted it to mean overall length exclusive of removable items.The provision of the bylaws at issue states that the "maximum length and beam of the boat or vessel that may utilize the assigned slip will be fixed at the date of assignment."(Emphasis added.)The Millers' slip was "rated for boat no larger than: 25L x 8-1/2W (Beam)."(Bolding omitted.)

First, we must determine if the term "length" is ambiguous.Ambiguity exists when the parties reasonably disagree as to the term's meaning.Greenhalgh v. Presstek, 152 N.H. 695, 698(2005).The Boat Club contends that the term "length" is unambiguous and means "point to point."For support it refers to its rules and regulations that require "satisfactory documentation evidencing the . . . length" of the boat.That provision, however, does not specify the nature of such documentation, inviting the Millers' argument that the boat's hull length, registration, or manufacturer's specifications should govern.The Millers further respond that the term "length" is ambiguous because the term was undefined without a method of measurement.We agree with the Millers that the term "length" is ambiguous as it is subject to multiple reasonable interpretations.

When a term is ambiguous, we determine what the parties mutually understood the ambiguous language to mean under an objective standard.Greenhalgh, 152 N.H. at 698.The trial court reviewed the summary judgment record and analyzed the reasons for the Boat Club's rules, regulations, and bylaws.It considered the rules, regulations, and bylaws as a whole in light of their intended purposes.It determined that discounting removable fixtures was consistent with maintaining an overall length restriction to further the purposes of visual appearance, docking multiple boats, and avoiding strain on the dock slips.The trial court concluded that the meaning of boat "length" is the overall length of the boat measured from the farthest forward point of the boat to its farthest rearward point excluding detachable...