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THE SUPREME COURT OF NEW HAMPSHIRE
___________________________
Hillsborough-northern judicial district
No. 96-686
DENNIS BEZANSON, TRUSTEE OF ATOM CONTRACTING, INC.
v.
HAMPSHIRE MEADOWS DEVELOPMENT CORP.
November 18, 1999
Wadleigh, Starr, Peters, Dunn & Chiesa, of Manchester (William S. Gannon & a. on the brief, and Robert E. Murphy, Jr. orally), for the plaintiff.
Steven G. Shadallah, of Salem, by brief and orally, for the defendant.
THAYER, J. The plaintiff, Dennis Bezanson, trustee for Atom Contracting, Inc. (Atom), appeals from a Superior Court (Groff, J.) order issued after a lengthy trial. The court reduced the plaintiff's damages arising from defendant Hampshire Meadows Development Corporation's breach of contract by the amount of the defendant's damages, even though the defendant did not file a claim for recoupment. We affirm in part, reverse in part, and remand.
The following facts were adduced at trial. In March 1990, Atom contracted to provide the defendant labor and materials to construct a housing development. The contract price was $2,895,000. The contract required Atom to pay for inspection fees. It permitted the defendant to withhold payments to Atom on account of, inter alia, unremedied defective work and failure to pay subcontractors. The contract also provided that in the event of the defendant's breach, Atom, upon seven days written notice, could terminate the contract and recover payment for "[w]ork executed and for proven loss . . . , including reasonable overhead, profit and damages."
After construction began, a deed restriction was discovered that forced the defendant to modify its plans. Several change orders ensued, increasing the contract price to $3,163,582.
In June 1992, the defendant refused to make further payments until Atom performed certain specified duties. Later that month, Atom ceased all work on the project. Atom subsequently filed for protection under Chapter 11 of the United States Bankruptcy Code. See 11 U.S.C.A.