[NH] [NH] Does a contractor have to honor their warranty?

Greetings! I hope this message finds you well. I'm thrilled to have the opportunity to assist you with your situation and provide you with the support you need. Thank you for your patience, and I look forward to working with you.

In New Hampshire, home warranty agreements, like any contract, are governed by contract law principles. The key issues here will be the specific terms of the warranty regarding what kinds of defects are covered, the obligations of the contractor or warranty provider to repair versus reimburse, and the reasonable scope of those repairs.

If the warranty explicitly requires the contractor to coordinate and perform repairs for covered defects, then their refusal to do so could be a breach of contract. Your documentation of the issues, communication, and the contractor’s partial acknowledgment strengthens your position.

Given they offered an insufficient payout, you may have the right to reject it and demand either full repair or full reimbursement of reasonable costs to fix the defects. It’s also advisable to review whether your warranty or contract includes any dispute resolution mechanisms such as arbitration or mediation before pursuing litigation.

If the contractor continues to stall or refuse proper repairs, your next step might be to send a formal demand letter outlining the breach and demanding full performance or reimbursement, possibly threatening legal action if not resolved.

If that fails, you may have to consider filing a breach of contract claim in small claims court or superior court, depending on the amount in controversy. If you pursue legal action, having your written evidence and possibly expert evaluations of the defects and repair costs will be crucial.

Also, in New Hampshire, there are consumer protection laws that may apply if the contractor’s conduct is found to be unfair or deceptive, so you might want to check with the Attorney General’s Consumer Protection Division (www.doj.nh.gov)  or consult a local attorney experienced in construction or contract law to explore all remedies.

Ultimately, you should insist on enforcing the warranty as written and avoid accepting inadequate offers that leave you with unresolved issues or additional costs.

I hope I was able to help you and answer all of your questions and concerns. Is there any part of my response that you need clarification on or any further information? Did you have any other questions on this subject for me today?

That’s a great question and an important detail to consider. When a contract includes a mediation clause, it usually means that before either party can pursue a lawsuit or formal legal action, you are expected to attempt mediation to resolve the dispute.

So, even if the contractor sends a so-called “final offer,” if the contract requires mediation first, they may be bypassing an agreed-upon step in the process by not properly engaging in or offering mediation before making that final offer.

In other words, sending a “final offer” doesn’t automatically waive your right to demand mediation if it’s specified in the contract. If they refuse to participate in mediation, or if they force you to accept their final offer without mediation, you could argue that they are in breach of the contract for failing to follow the agreed dispute resolution procedure.

Typically, it would be your responsibility—or sometimes a joint responsibility—to initiate the mediation process under the terms of the contract. This usually means formally requesting mediation in writing, perhaps even through a demand letter that references the mediation clause and states your intent to invoke it. This puts the contractor on notice that you expect the mediation process to be honored before considering any final settlement offers.

Mediation is essentially a structured, informal negotiation facilitated by a neutral third party—the mediator—who helps both sides communicate and try to reach a mutually acceptable resolution without going to court.

It’s generally less formal, faster, and less expensive than litigation. In your case, the contract requires you and the contractor to jointly pay for this process, which is pretty standard to share mediation costs equally. The actual cost of mediation can vary widely depending on the mediator’s rates and the complexity of the dispute, but it often ranges from a few hundred dollars to a couple thousand dollars per session, with sessions typically lasting a few hours to a full day.

Some mediators charge by the hour, others have flat fees. You might also find community mediation services or local bar associations that offer more affordable or sliding-scale fees.

Regarding your concern about hiring a lawyer before or during mediation, generally, having legal representation does not breach the mediation clause. In fact, it’s quite common and advisable to have a lawyer assist you during mediation, especially when dealing with complex contract disputes like yours.

The mediation clause usually doesn’t prohibit legal counsel; it simply requires that both parties participate in good faith mediation. Having a lawyer can help you prepare your case, negotiate more effectively, and ensure your rights are protected throughout the process.

Just make sure your lawyer knows the contract’s mediation requirement so they help you comply properly.

Looking at the specific contract language you provided, it states clearly that both parties “agree to settle the dispute by jointly paying for mediation” and “agreeing to enter into good faith negotiations through a neutral mediator.”

This confirms your obligation to attempt mediation first and share the cost before pursuing further action. The clause doesn’t limit your ability to get legal advice or representation at any stage.

So, your practical steps would be to formally propose mediation in writing to the contractor, perhaps including a suggestion for a neutral mediator (sometimes the state or local bar association can recommend mediators), agree on scheduling and cost-sharing, and consider retaining a lawyer who can guide you through this process and represent your interests during mediation.

The goal is to resolve the dispute without the expense and time of a lawsuit, but with legal guidance to keep everything on track.

Thank you so much for giving me the opportunity to assist you, and please don't hesitate to reach out if you have any further questions or concerns.