Patriot Insurance Company et al v. Tri State Hood & Duct, LLC et al

Filing 65

ORDER denying 54 Partially Assented to Motion for Leave to File Third Party Complaint. So Ordered by Judge Steven J. McAuliffe.(lw)

UNITED STATES DISTRICT COURT
DISTRICT OF NEW HAMPSHIRE

Patriot Insurance Company a/s/o
Jessica Realty, LLC, and
Harleysville Insurance Company
a/s/o PDS Restauranteurs, Inc.,
d/b/a Portsmouth Gas Light Restaurant,
Plaintiffs
v.

Case No. 18-cv-062-SM
Opinion No. 2019 DNH 196

Tri State Hood & Duct, LLC, Tri State
Fire Protection, LLC, and 11 Holland,
Inc., d/b/a Clean Choice &
Portsmouth Steam,
Defendants

O R D E R
Defendants Tri State Hood & Duct, LLC, and Tri State Fire
Protection, LLC, (collectively, “Tri State”) have moved for
leave to file a third party complaint against PDS
Restauranteurs, Inc., d/b/a Portsmouth Gas Light Restaurant
(“Gas Light”).

Plaintiffs, Harleysville Insurance Co., as

subrogee of Gas Light, and Patriot Insurance Company, as
subrogee of Jessica Realty, LLC, object.

Tri State’s motion for

leave to file is necessarily denied.
BACKGROUND
The current action arises out of a fire that occurred on
December 9, 2015, at 64 Market Street, in Portsmouth.

Jessica

Realty, LLC, is the owner of the property, and leases it to Gas

Light.

Gas Light operates two restaurants, a nightclub, and an

outdoor patio, at the property.

At all relevant times, Tri

State Hood and Portsmouth Steam provided inspection, maintenance
and cleaning work and services to Gas Light with respect to its
commercial kitchen hood and ductwork.

Tri State Fire, for its

part, provided inspection, testing, repair and maintenance work
and services for Gas Light’s commercial fire suppression system.
The December, 2015, fire began in Gas Light’s kitchen hood and
duct system.

The fire caused extensive damage to the property,

including damage to equipment and inventory, as well as a
significant loss of business income.
Jessica Realty notified and submitted a claim to its
insurer, plaintiff Patriot Insurance Company.

Gas Light, for

its part, duly made a claim to its insurer, Harleysville.
Patriot and Harleysville paid the claims and, as subrogees of
the insured parties, filed suit against Tri State and Portsmouth
Steam, alleging, inter alia, that defendants’ negligence in
cleaning, servicing and maintaining the kitchen hoods, ducts,
and fire suppression systems had proximately caused or
substantially contributed to the fire.
Tri State now moves for leave to file a third party
complaint against Gas Light.

Tri State has not attached a

proposed third-party complaint to its motion for leave, as is
customary.

However, in its motion for leave, Tri State states
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that “supplemental discovery responses . . . indicate[] that the
negligence of Gas Light Restaurant and/or its employees caused
or contributed to the subject fire.”

Mot. for Leave at ¶ 3.

Presumably, Tri State seeks to assert a claim for contribution
against Gas Light with respect to Patriot’s claim (Jessica
Realty).
DISCUSSION
Pursuant to Federal Rule of Civil Procedure 14(a)(1), a
“defending party may, as third-party plaintiff, serve a summons
and complaint on a nonparty who is or may be liable to it for
all or part of the claim against it.”

The rule allows

defendants to bring a third party into the suit without leave of
court, provided defendants file within 14 days of submitting
their answer to the plaintiff’s complaint.
defendant must seek leave of the court.

Otherwise, the

“In that event, the

determination is left to the informed discretion of the district
court, which should allow impleader on any colorable claim of
derivative liability that will not unduly delay or otherwise
prejudice the ongoing proceedings.”

Lehman v. Revolution

Portfolio LLC, 166 F.3d 389, 393 (1st Cir. 1999) (internal
citations omitted).

However, “[c]ourts may deny a defendant’s

request for leave ‘when bringing in a third party will introduce
unrelated issues and unduly complicate the original suit,’ or
‘if the [third party] claim is futile.’”
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Signs for Jesus v.

Town of Pembroke, No. 15-CV-482-PB, 2016 WL 4083723, at *2
(D.N.H. Aug. 1, 2016) (quoting S. Shore Hellenic Church, Inc. v.
Artech Church Interiors, Inc., No. 12–11663–GAO, 2015 WL 846533,
at *18 (D. Mass. Feb. 26, 2015)) (alterations in original).
Under New Hampshire law, “a right of contribution exists
between or among 2 or more persons who are jointly and severally
liable upon the same indivisible claim, or otherwise liable for
the same injury, death, or harm.”
507:7–f.

N.H. Rev. Stat. Ann. (“RSA”)

The statute further provides: “Except as provided in

RSA 507:7-g I, and IV, the right of contribution may be enforced
only by a separate action brought for that purpose.”

Id.

Pursuant to N.H. Rev. Stat. Ann. § 507:7–g, that separate action
arises following judgment rendered against a defendant in the
principal action, and “must be commenced [in a separate action]
within one year after the judgment becomes final.” N.H. Rev.
Stat. Ann. § 507:7–g(III).
However, if judgment has not been recovered in the
principal action, one of two conditions must be fulfilled before
a contribution cause of action arises:
If no judgment has been rendered, the person bringing
the action for contribution must have either (a)
discharged by payment the common liability within the
period of the statute of limitations applicable to the
claimant's right of action against that person and
commenced the action for contribution within one year
after payment, or (b) agreed while the action was
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pending to discharge the common liability and, within
one year after the agreement, have paid liability and
commenced an action for contribution.
N.H. Rev. Stat. Ann. § 507:7–g(III).

“In each circumstance

described, the defendant must bring the contribution cause of
action in a separate suit, the principal suit having been either
settled or never commenced by the potential plaintiff.”

Connors

v. Suburban Propane Co., 916 F. Supp. at 76.
“The single exception to the ‘separate action’ rule of
section 507:7–f(I) applicable here is found in section 507:7–
g(IV).”

Id.

That section provides:

[I]f and only if the plaintiff in the principal action
agrees, a defendant seeking contribution may bring an
action in contribution prior to the resolution of the
plaintiff's principal action, and such action shall be
consolidated for all purposes with the principal
action.
N.H. Rev. Stat. Ann. § 507:7–g(IV)(c) (emphasis added).

Thus,

“New Hampshire law prescribes four ways in which a defendant may
bring a contribution cause of action against a third-party, but
restricts a defendant's ability to bring a contribution suit
prior to resolution of the plaintiff's principal case to those
circumstances in which the plaintiff in the principal action
consents.”

Connors, 916 F. Supp. at 77.

Accordingly, assuming that Tri State can allege the
elements of a viable contribution claim under New Hampshire

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statutory law, this action is not the proper vehicle in which to
pursue that claim.

The court has previously discussed this

issue in detail, see Connors, 916 F. Supp. 73 (D.N.H. 1996), and
that analysis need not be repeated.

Suffice it to say, the

court concluded in Connors:
Because its use to implead third-party contribution
defendants would violate the Rules Enabling Act (by
limiting plaintiffs' and enlarging defendant’s
substantive rights under applicable state law), Fed.
R. Civ. P. 14 cannot be invoked, without plaintiffs'
consent, to bring a contribution action premised on
N.H. Rev. Stat. Ann. § 507:7-f & g against a thirdparty defendant in this diversity action.
Id. at 81.

But cf., Gilbert v. CPM Constructors, 96–cv–481–PB

(D.N.H. 1998) (slip op. at 2-3) (holding that “the right to
engage in third-party practice under Rule 14(a) affects only the
process of enforcing litigant’s rights rather than the rights
themselves”).

Plaintiffs in this action both oppose Tri State’s

efforts to pursue a statutory contribution claim against PDS.
Harleysville makes the argument that Tri State’s motion to
amend is also futile because, under New Hampshire law, no
contribution claim exists against a claimant at fault, like Gas
Light.

See NH RSA § 507:7-f.

It is doubtful, however, that

such a proposition would apply to a later-filed separate
contribution action brought by defendants against PDS to recover
damages attributable to PDS’s own negligence recovered by

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Jessica Realty.

But, that remains an issue for another day and

a different case.
CONCLUSION
For the foregoing reasons, Tri State’s motion for leave to
file a third party complaint (document no. 54) is DENIED.
SO ORDERED.

____________________________
Steven J. McAuliffe
United States District Judge
November 20, 2019
cc:

All counsel of record

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