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                 THE SUPREME COURT OF NEW HAMPSHIRE

                           ___________________________


Merrimack
No. 2012-623


                   IN THE MATTER OF THE LIQUIDATION OF
                       THE HOME INSURANCE COMPANY

                           Argued: October 16, 2013
                       Opinion Issued: February 13, 2014

      Orr & Reno, P.A., of Concord (Lisa Snow Wade on the brief and orally),
and Crowell & Moring LLP, of New York, New York, and Washington, D.C.
(Harry P. Cohen and Ellen M. Farrell on the brief), for the appellant.

      Michael A. Delaney, attorney general (J. Christopher Marshall, attorney,
on the brief), and Rackemann, Sawyer & Brewster P.C., of Boston,
Massachusetts (J. David Leslie and Eric A. Smith on the brief, and Mr. Leslie
orally), for the respondent.

      LYNN, J. The appellant, Century Indemnity Company (CIC), appeals an
order of the Superior Court (Smukler, J.) granting the motion of the
respondent, Roger A. Sevigny, Commissioner of Insurance of the State of New
Hampshire, as Liquidator (the Liquidator) of the Home Insurance Company
(Home) for an award of statutory prejudgment interest on certain monies owed
to Home by CIC. We affirm.
                                        I

      This is the fifth opinion we have issued in connection with the liquidation
of Home. See In the Matter of Liquidation of Home Ins. Co., 154 N.H. 472
(2006) (Home I); In the Matter of Liquidation of Home Ins. Co., 157 N.H. 543
(2008) (Home II); In the Matter of Liquidation of Home Ins. Co., 158 N.H. 396
(2009) (Home III); In the Matter of Liquidation of Home Ins. Co., 158 N.H. 677
(2009) (Home IV). The following facts either are drawn from our prior opinions
or are supported by the record in the instant appeal.

      Home is an insurance company, organized under the laws of New
Hampshire, which was declared insolvent and placed in liquidation in 2003.
Home II, 157 N.H. at 544. The Liquidator is vested with title to and charged
with administering and collecting Home’s assets for distribution to Home’s
creditors. Home I, 154 N.H. at 475. CIC is an insurance company organized
under the laws of Pennsylvania. Home II, 157 N.H. at 544-45. CIC and Home
have a set of co-insurance and reinsurance relationships, which are fully
described in our opinions in Home II and Home IV. See Home IV, 158 N.H. at
679-80; Home II, 157 N.H. at 544-46. In one aspect of the parties’ relationship,
CIC reinsures Home with respect to certain contracts between Home and other
insurers. Home II, 157 N.H. at 545. CIC and Home are also co-insurers of
certain companies, including Pacific Energy Company (PECO), meaning that
both CIC and Home are primary insurers of PECO. Home IV, 158 N.H. at 680.

       A number of documents govern aspects of the relationship between CIC
and Home, and we deal with three here. The first, the Restated and Revised
Order Establishing Procedures Regarding Claims Filed with the Home
Insurance Company in Liquidation (Claims Procedures Order) applies generally
to claims made against Home pursuant to the Insurers Rehabilitation and
Liquidation Act, RSA chapter 402-C (2006 & Supp. 2013); its purpose is to
achieve uniformity and provide procedures for the presentation, processing,
determination, and classification of claims against Home. It became effective
on January 19, 2005, and is a restated and revised version of an order
originally entered in the Home liquidation on December 19, 2003. It applies to
all “Claimants” in the Home liquidation, defining that term as “any
policyholder, reinsured, reinsurer, general creditor, third-party, or guaranty
association that has filed a Proof of Claim.” The second document, the “Claims
Protocol,” is a letter agreement between CIC and Home that governs the
handling by CIC, as reinsurer of Home, of a certain subset of claims against
Home (the AFIA Liabilities) by certain entities in the United Kingdom (the AFIA
Cedents) in connection with the American Foreign Insurance Association. See
Home I, 154 N.H. at 474-75 (explaining the reinsurance relationship between
CIC and Home with respect to the AFIA Liabilities). Of particular relevance
here, Section 3 of the Claims Protocol provides that CIC shall make certain
remittances to Home with respect to the AFIA Liabilities net of setoff as



                                       2
permitted by New Hampshire law, and will provide monthly reports as to those
remittances and setoffs. The third document, the Joint Report, is another
agreement between CIC and Home, and addresses contribution/subrogation
claims filed by CIC in the Home liquidation under four particular Proofs of
Claim. It sets forth the initial steps to be taken by the two parties after CIC
asserts such a claim, including CIC’s asserted PECO claim.

      This appeal flows directly from the facts at issue in Home IV. In that
appeal, we held that an asserted $8 million setoff claim by CIC, which had
been waived and then reacquired by CIC in a pair of settlement agreements
with PECO, was impermissible under New Hampshire law. Id. at 680, 684. We
also explicitly declined, without prejudice, to decide the issue now before us:
whether Home’s estate was entitled to prejudgment interest on the payments
CIC wrongfully withheld based upon setoff. Id. at 684.

      We denied CIC’s motion for reconsideration in the Home IV appeal on
June 10, 2009. After remand, the Liquidator filed a motion in superior court
on June 29, 2009, for interest on amounts withheld by CIC based upon
improper setoff, to which CIC objected on July 14, 2009. On August 3, 2009,
CIC removed the PECO setoff from its monthly statement to Home and paid the
previously withheld $8 million to the Liquidator. The trial court entered an
order granting the motion on August 3, 2012, finding that Home was entitled to
prejudgment statutory interest under RSA 524:1-a (2007) accruing from
October 12, 2007, the date of the Liquidator’s letter notifying CIC of his
determination to disallow the PECO setoff. This appeal followed.

                                        II

      On appeal, CIC argues that the trial court erred in granting Home
prejudgment interest pursuant to RSA 524:1-a, and that, in the alternative, it
erred in determining the correct accrual date. We disagree with both
arguments.

       This appeal requires us to interpret statutes as well as the contracts
between the parties. “The interpretation of a statute is a question of law, which
we review de novo.” Home IV, 158 N.H. at 681. “We are the final arbiters of
the legislature’s intent as expressed in the words of the statute considered as a
whole.” Id. “We first examine the language of the statute, and, where possible,
ascribe the plain and ordinary meanings to the words used.” Id. “Our goal is
to apply statutes in light of the legislature’s intent in enacting them, and in
light of the policy sought to be advanced by the entire statutory scheme.” Id.

       “The interpretation of a contract is a question of law, which we review de
novo.” Home II, 157 N.H. at 546. “When interpreting a written agreement, we
give the language used by the parties its reasonable meaning, considering the



                                        3
circumstances and the context in which the agreement was negotiated, and
reading the document as a whole.” Id. “Absent ambiguity, the parties’ intent
will be determined from the plain meaning of the language used in the
contract.” Id.

      CIC first asserts that the trial court erred in granting the Liquidator’s
motion for interest. It makes two arguments as to why RSA 524:1-a should not
apply: (1) this was not an “action on a debt or account stated” as required by
the statute; and (2) the agreements between CIC and Home create a
comprehensive protocol that does not allow for an award of interest on a
disputed setoff claim.

       CIC first argues that the underlying proceeding was not an “action on a
debt or account stated,” and thus RSA 524:1-a does not apply. In its order, the
trial court found that “there is a distinction between an action for setoff and an
action on a debt or account,” and CIC argues that the trial court erred when it
found that “the nature of this case is not one for setoff,” but is “more akin to a
debt claim or contract dispute.”

      Here, the trial court granted the Liquidator’s motion based upon RSA
524:1-a. We have previously indicated that “legislative history suggests that
RSA 524:1-a and :1-b were intended to provide the same protection to
prevailing parties.” Nault v. N & L Dev. Co., 146 N.H. 35, 39 (2001). All
statutes dealing with the same subject-matter are to be considered in
interpreting any one of them. Id. at 38. “Where reasonably possible, statutes
should be construed as consistent with each other.” Id. “When interpreting
two statutes which deal with a similar subject matter, we will construe them so
that they do not contradict each other, and so that they will lead to reasonable
results and effectuate the legislative purpose of the statute.” Id.

       “Ordinarily, upon a verdict for damages and upon motion of a party,
interest is to be awarded as a part of all judgments.” State v. Peter Salvucci
Inc., 111 N.H. 259, 262 (1971). RSA 524:1-a provides: “In the absence of a
demand prior to the institution of suit, in any action on a debt or account
stated or where liquidated damages are sought, interest shall commence to run
from the time of the institution of suit.” RSA 524:1-a. RSA 524:1-b further
provides:

      In all other civil proceedings at law or in equity in which a verdict
      is rendered or a finding is made for pecuniary damages to any
      party, whether for personal injuries, for wrongful death, for
      consequential damages, for damage to property, business or
      reputation, for any other type of loss for which damages are
      recognized, there shall be added . . . to the amount of damages




                                        4
      interest thereon from the date of the writ or the filing of the
      petition to the date of judgment . . . .

RSA 524:1-b (2007).

      The purpose of the legislature in enacting RSA 524:1-a and :1-b in 1957
was “to clarify and simplify the existing law and to make plain that in all cases
where the trial court awarded money to the party entitled to be compensated,
interest at the legal rate is to be added to the award.” N.H.S. Jour. 478-79
(1963) (statement of Sen. Samuel Green). Indeed, the legislature amended RSA
524:1-b in 1963 in response to our holding in Chagnon v. Union-Leader Co.,
104 N.H. 472 (1963), in which we held that certain kinds of libel actions did
not entitle parties to prejudgment interest under the statute. See Hanchett v.
Brezner Tanning Co., 107 N.H. 236, 241 (1966); N.H.S. Jour. 479-80 (1963).
In doing so, it made clear its intent that prejudgment interest be awarded in
such cases. See Hanchett, 107 N.H. at 241; N.H.S. Jour. 479-80 (1963).

       The functional difference, then, between sections 1-a and 1-b is that they
apply to different kinds of judgments. Section 1-a applies to actions “on a debt
or account stated or where liquidated damages are sought.” Section 1-b refers
back to section 1-a, providing that it applies to “all other civil proceedings at
law or in equity in which a verdict is rendered or a finding is made for
pecuniary damages to any party,” whether for one of the listed categories of
damages or for “any other type of loss for which damages are recognized.”
Stated more simply, section 1-a applies to certain actions for payment of a
fixed sum, whereas section 1-b applies to all other actions for damages.

       Additional clauses in each statute support this distinction. Section 1-a
contains a clause making its provisions “inapplicable where the party to be
charged pays the money into court.” Such a mechanism could only be sensibly
applied where the amount at issue is a liquidated sum. Section 1-b permits
the addition of interest even if such interest would bring the judgment amount
beyond the maximum liability imposed by law, a concern arising mainly in
actions in which the amount of damages to be awarded is uncertain at the
start of the case.

      Thus, the import of the language “any action on a debt or account stated
or where liquidated damages are sought” in section 1-a is that the statute
applies in actions for a fixed sum. Returning to CIC’s argument, we find no
meaningful distinction between an action on this disputed setoff and an “action
on a debt or account stated” under RSA 524:1-a. In this case, the dispute was
whether CIC could withhold payment of a fixed debt of $8 million under a
claimed setoff. Here, the procedural posture of the case as that of a disputed
claim in the Home liquidation, rather than a lawsuit to collect on a debt, is of
no consequence in terms of the interest statute.



                                         5
       CIC cites two cases distinguishing between setoff and an action on a
debt. See Koken v. Legion Ins. Co., 900 A.2d 418, 429 (Pa. Commw. Ct. 2006)
(“Setoff is not an action, and an action on a debt is not the equivalent of
setoff.”); Long Beach Trust Co. v. Warshaw, 190 N.E. 659, 660 (N.Y. 1934)
(“[T]he right to sue on a debt and the right to use the debt as an offset are not
equivalent.”). However, these cases made that distinction in a context that is
inapposite to the question at issue here. Both Koken and Long Beach Trust
involved the construction of statutes that would have precluded the bringing of
an “action” — in both cases, a counterclaim — but would not have precluded
the assertion of a setoff. See Koken, 900 A.2d at 429 (holding that allowing
bank to assert quasi-contract claim as setoff would violate state’s insurance
insolvency law); Long Beach Trust, 190 N.E. at 660 (holding that defendant
could assert setoff where failure to file a claim pursuant to Banking Law
statute barred counterclaim). For the purposes of our interest statute, we find
no significance in this distinction, and hold that RSA 524:1-a applies in this
case.

       We turn next to CIC’s second argument, that the agreements between the
parties were “comprehensive” and did not provide for interest on disputed
setoffs. The parties agree that their agreements are silent as to the issue of
interest. However, the parties disagree on how to interpret that silence. CIC
asserts that the agreements form a “comprehensive” protocol between the
parties and that the absence of language addressing interest demonstrates the
parties’ intent that interest not be awarded on a disallowed setoff. Thus,
according to CIC, the trial court impermissibly rewrote the parties’ agreements
by imposing prejudgment interest under RSA 524:1-a. We disagree.

      “The laws which subsist at the time and place of the making of a
contract, and where it is to be performed, enter into and form a part of it, as if
they were expressly referred to or incorporated in its terms.” Stankiewicz v.
City of Manchester, 156 N.H. 587, 590 (2007) (quotation omitted). To be sure,
where the parties’ contract includes a provision for interest, we have applied it,
our interest statutes notwithstanding. See Tulley v. Sheldon, 159 N.H. 269,
274 (2009) (holding that plaintiffs were entitled to contractual 1.5%
prejudgment interest rate rather than statutory rate); Lassonde v. Stanton, 157
N.H. 582, 594 (2008) (holding that plaintiffs were entitled to at least 15%
statutory interest where contract provided for 15-18% finance charge per
annum on unpaid balances); Mast Rd. Grain & Bldg. Mat’s Co. v. Piet, 126
N.H. 194, 197 (1985) (interpreting contractual clause providing for debtor to
pay “all accrued finance charges to date” as providing that 24% finance charge
applied only up to date of demand, after which statutory interest rate applied
under RSA 524:1-a).

       But these cases do not support the proposition that where an agreement
is silent as to interest, no interest accrues. To the contrary, that is exactly the



                                         6
circumstance where the default rule established by RSA 524:1-a applies most
clearly. John A. Cookson Co. v. N.H. Ball Bearings, 147 N.H. 352, 361-62
(2001) (holding that arbitrator could include interest in award where parties’
arbitration agreement was silent on issue of interest); Albee v. Wolfeboro
Railroad Co., 126 N.H. 176, 181 (1985) (holding that statutory interest rate
applied on amount owed after terms of interest called for by note had expired).
The very purpose of adding interest to an award or judgment, including under
RSA 524:1-a and :1-b, is to recognize the time value of money by compensating
a creditor for the delay between when money is due and when it is paid. See
John A. Cookson Co., 147 N.H at 362 (stating that “money has a ‘use value’”
and that interest as a component of damages compensates the prevailing party
for lost use of its money). Thus, unless an agreement specifically provides to
the contrary, RSA 524:1-a applies.

       Here, the parties entered into two agreements, the Joint Report and the
Claims Protocol, and abided by a third applicable document, the Claims
Procedure Order. None of these documents provides for a different interest rate
on disputed amounts than the statutory rate. Further, nothing in the
agreements supports CIC’s claim that the agreements, as a whole, are
“comprehensive” in nature. To the contrary, the agreements between CIC and
Home demonstrate the parties’ intent to reserve their rights as to matters not
addressed. For example, Paragraph 3.3 of the Claims Protocol contains two
reservations of rights: the first in which the Liquidator “fully reserve[d] all
rights in relation to any offset asserted”; and the second in which CIC reserved
its rights “in respect of any payments made, including as to amount and as to
the obligation of CIC to make the same.” Paragraph 7 of the Joint Report
further provides that “CIC and the Liquidator reserve all rights as against each
other.” In addition, the Joint Report provides that with respect to any fully or
partially disallowed claim, the parties will jointly seek an order from the Referee
that the matter be deemed a disputed claim proceeding and “treated as such
under the RSA and the Claims Procedures Order” (emphasis added), showing a
clear intent that New Hampshire statutory law be applied where the
agreements are silent.

      To interpret the parties’ silence on the issue of interest as evincing an
intent that there be none would require us to write into the contract a term
that the parties did not include. Had the parties intended that the interest
statute not apply, they could have included a clause in one of the agreements
stating as much. By the plain meaning of the language used in the
agreements, then, CIC’s argument that they are “comprehensive” fails.

                                        III

      In its alternative argument, CIC claims that the trial court erred in ruling
that prejudgment interest should accrue from the date of the Liquidator’s



                                        7
October 12, 2007 letter. CIC claims that: (1) the October 12, 2007 letter did
not constitute a “demand” under RSA 524:1-a; and (2) under the Claims
Protocol, CIC was not obligated to pay Home until the resolution of the
proceedings related to the PECO setoff. We again disagree.

       Pursuant to Paragraph 3.3 of the Claims Protocol, CIC first asserted the
PECO setoff in its July 2007 statement, which was sent to the Liquidator on
August 29, 2007. CIC withheld $8 million of payments in its remittances
under its July, August, and September 2007 statements based upon the PECO
setoff. On October 12, 2007, pursuant to the Joint Report, the Liquidator
advised CIC of his determination to disallow CIC’s asserted PECO setoff and
that he was prepared to jointly request that the Referee deem the asserted
PECO setoff a disputed claim proceeding. The parties submitted this request to
the Referee on October 18, 2007.

      CIC first argues that the Liquidator’s October 12, 2007 letter could not
be a demand pursuant to RSA 524:1-a because the letter makes no request for
interest. “It is undisputed that under RSA 524:1-a, interest shall accrue from
the earlier of either the demand for payment or the institution of suit.” Lago &
Sons Dairy, Inc. v. H.P. Hood, Inc., 892 F. Supp. 325, 346-47 (D.N.H. 1995).
Under the statute, the “demand” need be for payment, not for interest as CIC
suggests. See J & M Lumber and Const. Co. v. Smyjunas, 161 N.H. 714, 729
(2011) (analyzing whether interest ran from date plaintiff initiated lawsuit or
date of alleged “demand for payment”); Lipski v. Polonsky, 122 N.H. 528, 530
(1982) (holding that interest accrued from date of demand of repayment on
promissory note).

       Turning to the Liquidator’s October 12, 2007 letter, the unredacted
portions that are in the record do not explicitly demand payment. They do
inform CIC that the Liquidator was disallowing the PECO claim and was
prepared to jointly seek an order from the Referee deeming the claimed setoff a
disputed claim proceeding. However, the import of disallowing the asserted
PECO claim was that the Liquidator would seek to recover the monies so
withheld, the equivalent of a demand for payment. We thus hold that the
October 12, 2007 letter constitutes a “demand” under RSA 524:1-a, and that
the trial court correctly determined that interest should accrue from this date.

      CIC argues further that, under Paragraph 3.3 of the Claims Protocol, it
was not obligated to pay Home until the resolution of the proceedings related to
the PECO setoff. In full, Paragraph 3.3 states:

      Within thirty (30) business days after the end of each month, CIC
      shall (a) provide [Home] with a statement showing (i) all amounts
      payable by CIC to [Home] pursuant to [certain paragraphs of the
      Claims Protocol] for the preceding month; (ii) the amount of funds



                                       8
      paid by CIC with respect to such payables; and (iii) any amounts
      claimed in offset in accordance with paragraph 3.4 against
      amounts due to [Home], together with sufficient detail and an
      explanation as to the basis for the asserted offset; and (b) subject
      to the proviso to this paragraph, effect a wire transfer to such
      account as may, from time to time, be designated by the Liquidator
      for the balance. CIC agrees and acknowledges that the Liquidator
      fully reserves all rights in relation to any offset asserted. CIC
      reserves (and the Liquidator acknowledges that CIC so reserves) all
      rights in respect of any payments made, including as to amount
      and as to the obligation of CIC to make the same; PROVIDED
      THAT, where the Claimant has submitted a request for Review or
      an Objection in respect of a Claim disputing the quantum of the
      Claim or elements of it, CIC shall make remittance in respect of
      any portions of the Claim allowed in full or agreed between CIC
      and the Claimant. CIC shall not be obliged to make remittance in
      respect of the disputed amount unless and until the relevant
      proceedings settle the disputed amount or it is negotiated and
      agreed between the claimant and CIC with the concurrence of the
      Liquidator, in which event remittance will be made in such amount
      within thirty (30) business days after the month next following
      such settlement or agreement.

       CIC relies on the second sentence of the proviso to Section 3.3, claiming
that it has no obligation to remit payment on a disputed claim “unless and
until the relevant proceedings settle the disputed amount or it is negotiated
and agreed between the claimant and CIC with the concurrence of the
Liquidator.” Thus, CIC claims its obligation to remit payment of the monies
withheld pursuant to the disputed PECO setoff was not triggered until we
denied CIC’s motion for reconsideration on June 10, 2009, and payment was
therefore not due until July 30, 2009, “thirty . . . business days after the
month next following such settlement or agreement.” As a result, CIC contends
that interest could not begin to accrue until then, four days before it paid the
$8 million to Home on August 3, 2009.

      The Liquidator counters, and we agree, that CIC fails to read the Claims
Protocol in context. “When interpreting a written agreement, we give the
language used by the parties its reasonable meaning, considering the
circumstances and the context in which the agreement was negotiated, and
reading the document as a whole.” Home II, 157 N.H. at 546 (emphasis added)
(quotation omitted). CIC’s strained construction of a single sentence ignores
other language in Section 3.3 as well as the other sections of the Claims
Protocol that make it clear that the proviso does not apply in this case.




                                       9
       The Claims Protocol defines the terms “Claimant” and “Claim,” and
incorporates the definitions of “Request for Review” and “Objection” provided in
the Claims Procedures Order by reference, as these terms are used in the first
sentence of the proviso to Section 3.3. “Claim” is defined as “an inward
reinsurance claim against [Home] in respect of an AFIA Liability presented in” a
proof of claim filed in the Home liquidation, where “AFIA Liability” is defined in
a separate agreement. A “Claimant” is “a person submitting a Claim in the
[Home] liquidation.” “Request for Review” is defined as a request by a Claimant
“that the Liquidator reconsider a Notice of Determination.” And finally, the
Claims Procedures Order provides that an “Objection” to a Notice of
Determination may be filed with the Superior Court for Merrimack County.
Applying these definitions in Section 3.3, we conclude that this section defines
CIC’s payment obligations when the Liquidator challenges an inward insurance
claim filed by an AFIA Cedent, not a claim by CIC itself. That is clearly not the
situation at hand, in which the claim at issue was filed by CIC under one of its
own proofs of claim as a co-insurer with Home, rather than by an AFIA Cedent
as to an AFIA Liability under which CIC is a reinsurer of Home. Because we
reject CIC’s reading of the proviso to Section 3.3, its argument fails.

       In sum, we affirm the trial court judgment as to both its granting of the
Liquidator’s motion and the date from which prejudgment interest accrued.
Because of our holding, we need not reach the Liquidator’s unjust enrichment
claim.

                                                  Affirmed.

      DALIANIS, C.J., and HICKS, J., concurred.




                                       10
