Inquiry Notice in Fiduciary Investment Relationships: Trust and Opaque Reporting Can Delay the Statute of Limitations Under RSA 508:4, I

Introduction

In BDP Holdings, LLC v. The Eideard Group, LLC & a., the New Hampshire Supreme Court affirmed a jury verdict of approximately $27.6 million in favor of BDP Holdings, LLC (BDP) against its former family office manager and investment adviser, Ronald L. Roberts (now represented by his estate), The Eideard Group, LLC, and Roberts Asset Management, LLC. The case arose out of a years-long, highly concentrated investment and credit exposure to a private company, G-Form, in which Roberts personally co-invested and on whose board he served—all with insufficient disclosure to BDP.

The appeal presented three principal issues:

Whether BDP’s claims were time-barred or saved by the discovery rule codified in RSA 508:4, I;
Whether the evidence of causation was sufficient to withstand motions for a directed verdict and to set aside the verdict; and
Whether alleged instructional and evidentiary errors warranted reversal.

The Court’s order (issued under Sup. Ct. R. 20(3)) breaks new doctrinal ground in its application of the discovery rule to fiduciary investment-adviser relationships. It holds that, in assessing when a plaintiff should be on inquiry notice, courts may consider the trust placed in a fiduciary and the opacity of the fiduciary’s reporting. Generic “alternative assets” labels and non-specific performance reports, coupled with inadequate conflict disclosures, did not put BDP on inquiry notice before June 2018. The Court also upheld the jury’s findings on causation and rejected the appellants’ remaining claims of error.

Summary of the Opinion

The Supreme Court affirmed across the board:

Statute of Limitations: The discovery rule under RSA 508:4, I applied. The trial court reasonably found that BDP did not discover, and could not reasonably have discovered, its injury and its causal connection to the defendants’ conduct until June 2018 at the earliest—when Roberts first disclosed that G-Form had stopped paying interest and that restructuring was under consideration. Thus, the May 2021 complaint was timely.
Causation and Sufficiency of Evidence: Viewing the record in the light most favorable to BDP, a rational jury could find both cause-in-fact and legal cause. Evidence included expert testimony that no prudent manager would have pursued the G-Form investment on the terms used, that industry standards were violated (especially concerning conflict disclosures and suitability/risk tolerance analysis), and that Roberts subordinated BDP’s secured creditor position to interests aligned with G-Form and himself. The COVID-19 pandemic was not the primary cause given substantial pre-2020 losses.
Other Challenges: The appellants failed to demonstrate reversible error in jury instructions or evidentiary rulings.

Analysis

Precedents Cited and Their Role

RSA 508:4, I: Codifies New Hampshire’s discovery rule for personal actions (other than slander and libel). The limitations period begins when the plaintiff discovers, or in the exercise of reasonable diligence should have discovered, the injury and its causal relationship to the act or omission.
Balzotti Global Grp., LLC v. Shepherds Hill Proponents, LLC, 173 N.H. 314 (2020): Confirms that RSA 508:4, I codifies the common-law discovery rule and emphasizes its equitable character. Also frames review of equitable rulings for unsustainable exercise of discretion.
Beane v. Dana S. Beane & Co., 160 N.H. 708 (2010): Articulates the two-prong test: a plaintiff must know (or reasonably should know) both that it has been injured and that the injury was proximately caused by the defendant’s conduct. It clarifies that tolling does not persist until the full extent of injury manifests and that mere “possibility” of a causal connection can be sufficient to start the clock—once some harm and a potential causal connection are reasonably knowable.
Kelleher v. Marvin Lumber & Cedar Co., 152 N.H. 813 (2005): Whether the plaintiff exercised reasonable diligence in discovering the causal connection is a question of fact.
Keshishian v. CMC Radiologists, 142 N.H. 168 (1997): The discovery rule inquiry is equitable in nature, reinforcing deferential appellate review of the trial court’s application.
Benoit v. Cerasaro, 169 N.H. 10 (2016): Defines the “unsustainable exercise of discretion” standard: the appellant must show the ruling was unreasonable or untenable to the prejudice of their case.
101 Ocean Blvd., LLC v. Foy Ins. Grp., Inc., 174 N.H. 130 (2021): Sets the directed verdict standard: grantable only if the evidence, viewed most favorably to the non-movant, supports only one reasonable inference in favor of the movant. Courts may not weigh credibility at this stage.
Carignan v. N.H. Int’l Speedway, 151 N.H. 409 (2004): Discusses proximate cause, including cause-in-fact and legal cause, and the “substantial factor” analysis—typically for the trier of fact.
Gallo v. Traina, 166 N.H. 737 (2014): The appellant bears the burden of demonstrating reversible error.
Sup. Ct. R. 20(3): Authorizes disposition of cases by order.
Sup. Ct. R. 25(8): Addresses summary affirmance where appellants fail to demonstrate reversible error.

Legal Reasoning

1) Discovery Rule and Statute of Limitations

The Court reaffirmed the two-prong test under RSA 508:4, I and Beane: the limitations period does not begin until the plaintiff knew or reasonably should have known (a) that it suffered some injury and (b) that the injury was proximately caused by the defendant’s conduct. The Court stressed familiar boundaries: the rule does not delay accrual until the plaintiff appreciates the full extent of damages; once some harm and the possibility of a causal connection are reasonably discernible, the clock begins.

The novelty here lies in applying these principles to a fiduciary investment-adviser context featuring non-specific client reporting and inadequate conflict disclosures. The Court approved the trial court’s reliance on the following facts:

BDP’s relationship with Roberts and The Eideard Group was fiduciary in character. Roberts served as BDP’s managing member with full discretionary authority and was an investment adviser charged with developing a strategy consistent with a conservative risk tolerance.
The quarterly reports (with rare exceptions) grouped positions into generic “Alternative Assets” categories such as “Promissory Notes” or “Venture Capital,” without naming specific investments, and did not reveal G-Form’s financial distress or the scale of BDP’s exposure.
Roberts did not fully disclose his personal co-investment, his G-Form board seat (later chairmanship), or the 750,000-share equity stake he received—all conflicts bearing directly on decision-making.
A May–June 2018 exchange triggered initial notice: counsel’s questions asked about the terms, collateral, valuation, and interest payments. Roberts’ June 2018 response disclosed that G-Form had not paid interest since early 2017 and that restructuring was under review. Only then did a duty to inquire meaningfully arise. Further, the depth of exposure, the losses, and the self-interested debt-to-equity conversion plan were not revealed until February 2019.

The defendants argued that BDP had long been on inquiry notice—citing knowledge of “alternative investments” from 2007 and the G-Form investment from 2012–2013. The Court rejected this, finding no pre-2018 information that reasonably would have alerted BDP that it suffered some harm causally related to the defendants’ actions. Generic reporting and BDP’s reliance on its fiduciary did not equate to a failure of reasonable diligence.

Importantly, the Court held that it was not error for the trial court to consider the level of trust BDP placed in its fiduciary when determining when a duty to inquire arose. That is a significant doctrinal clarification: in fiduciary advisory relationships, the beneficiary’s trust and the opacity of the fiduciary’s reporting can legitimately affect the inquiry-notice analysis.

Applying the deferential “unsustainable exercise of discretion” standard to this equitable question, the Court found ample record support for the conclusion that June 2018 was the earliest trigger—well within three years of the May 2021 filing.

2) Causation and Denial of Directed Verdict / Motion to Set Aside

The Court reviewed the directed verdict and set-aside rulings de novo under 101 Ocean Blvd., but with the evidence viewed favorably to BDP. Proximate cause issues are ordinarily for the jury (Carignan), and the record here supported the jury’s findings on both cause-in-fact and legal cause:

BDP’s expert testified that no prudent manager for an entity like BDP would have purchased “a dollar of G-Form” on the terms used and quantified damages as the difference between actual results and what a diversified stock portfolio would have produced (estimated $55–$80 million, of which the jury awarded about $27.6 million).
Another expert identified multiple industry-standard violations: inadequate or non–“full and fair” conflict disclosures; failure to ascertain and respect BDP’s conservative risk tolerance; and failure to conduct proper analyses, including a liquidation analysis before converting secured debt to equity—especially important given Roberts’s G-Form roles and equity stake.
The jury could reasonably find that Roberts subordinated BDP’s secured position to interests aligned with G-Form and himself by advocating a debt-to-equity conversion, rather than considering foreclosure and asset liquidation to protect BDP.
Contrary to defendants’ assertions, evidence supported a finding that—had the Hoehls known the true performance and exposure earlier—they would have acted differently (e.g., withdrawn or redirected investments).
The COVID-19 pandemic did not break the causal chain: G-Form’s multi-million-dollar annual losses predated 2020, undercutting any claim that pandemic-related shocks were the primary cause.

With multiple reasonable inferences supporting BDP, directed verdict was properly denied, and the verdict stood.

3) Instructions and Evidentiary Rulings

The appellants bore the burden to demonstrate reversible error (Gallo). The Court, after reviewing the law and the record, found no reversible instructional or evidentiary error and affirmed under Sup. Ct. R. 25(8).

Impact and Practical Implications

A. Statute of Limitations in Fiduciary Advisory Contexts

This decision sharpened the inquiry-notice analysis for fiduciary investment relationships in New Hampshire:

Courts may account for the fiduciary nature of the relationship and the beneficiary’s reasonable trust in the fiduciary when assessing when the duty to inquire arises.
Non-specific portfolio reporting (e.g., umbrella categories like “Alternative Assets,” “Promissory Notes,” “Venture Capital”) will not, by itself, trigger inquiry notice of harm or of a causal connection—especially where conflicts and concentration risks are inadequately disclosed.
Initial, partial disclosures can set the earliest trigger date. Here, June 2018 disclosures about missed interest payments and potential restructuring were the first facts sufficient to prompt inquiry notice.
Defendants relying on statute-of-limitations defenses in advisory/family office cases will need to show that plaintiffs possessed information sufficient to indicate some harm and a possible causal link earlier than claimed, not merely that plaintiffs knew they held “alternative investments.”

B. Fiduciary Duty, Conflicts, and Suitability

The Court’s causation analysis underscores how breaches of duty and industry-standard lapses can ground liability:

Conflict disclosures: “Full and fair” disclosure matters. Co-investments, board seats, stock grants, and any remuneration or role that could misalign incentives must be disclosed candidly and contemporaneously.
Suitability and risk tolerance: Documented inquiry into a client’s risk profile and objectives is essential, especially where concentrated positions or private credit exposures are considered.
Decision-process rigor: Before sacrificing a client’s secured creditor status (e.g., debt-to-equity conversions), fiduciaries should conduct and document formal liquidation and alternatives analyses.
Reporting specificity: Periodic reports should name material positions and exposures, especially when concentration exceeds reasonable thresholds. Generic categories invite scrutiny and, as this case shows, may delay inquiry notice instead of protecting the adviser.

C. Damages Models in Advisory Litigation

The Court implicitly accepted a portfolio-differential damages model: comparing actual performance to a prudent diversified benchmark. While the amount remained a jury question, the acceptance of that framework will embolden plaintiffs (and experts) to present “but-for diversified portfolio” models where imprudent concentration or conflicts distorted allocations.

D. Litigation Strategy Takeaways

For defendants: A statute-of-limitations defense must be tethered to concrete, client-facing disclosures that would have alerted the client to harm and a potential causal link. Boilerplate risk disclosures and generic asset labels are unlikely to suffice.
For plaintiffs: Document the timeline of disclosures, the specificity (or lack) of reports, and fiduciary representations of trust and discretion. Emphasize when the first concrete red flags emerged.
For both sides: Expert testimony on industry standards, fiduciary practices, and portfolio management will often be dispositive on causation and damages.

Complex Concepts Simplified

Discovery rule (RSA 508:4, I): A time-limit “tolling” principle. The statute of limitations starts when a plaintiff knows, or should know with reasonable diligence, that it has been injured and that the injury may have been caused by the defendant. It does not wait for the plaintiff to know the full extent of damages.
Inquiry notice: The point at which available facts would prompt a reasonable person to investigate further, revealing injury and a potential causal link to the defendant’s conduct. In fiduciary contexts, trust and opaque reporting can delay when a reasonable duty to inquire arises.
Cause-in-fact vs. legal cause (proximate cause): Cause-in-fact asks whether the harm would have occurred “but for” the defendant’s conduct. Legal cause asks whether the defendant’s conduct was a substantial factor in bringing about the harm and whether any intervening causes break the chain.
Directed verdict: A judgment for one party during trial because no reasonable jury could find otherwise on the evidence presented. Courts must view the evidence most favorably to the non-moving party and may not weigh credibility.
Unsustainable exercise of discretion: The standard of appellate review for equitable determinations. The appellant must show the trial court’s decision was unreasonable or untenable and prejudiced their case.
“Full and fair” conflict disclosure: In fiduciary settings, disclosure that is complete, candid, and timely regarding any interest that could affect the adviser’s judgment (e.g., personal investments, board roles, compensation).

Conclusion

BDP Holdings v. The Eideard Group clarifies New Hampshire’s discovery rule in the fiduciary investment-adviser context. The Supreme Court held that a beneficiary’s trust in a fiduciary, combined with non-specific portfolio reporting and inadequate conflict disclosures, can delay inquiry notice under RSA 508:4, I. Practically, that means limitations defenses will be harder to sustain where the adviser’s communications obscured concentration, performance, or conflicts.

The Court also reaffirmed traditional deference to jury determinations on proximate cause, validating expert-driven theories that imprudent concentration, conflict-driven decisions, and departures from industry standards can be both the but-for and legal cause of substantial portfolio losses. Arguments that pandemic-era volatility was the primary cause failed in the face of extensive pre-2020 losses and the adviser’s own admissions.

The takeaway is twofold: fiduciary advisers should ensure specific, comprehensible reporting and full conflict disclosures aligned with a documented understanding of client risk tolerance; and litigants should recognize that, in such relationships, the statute of limitations may not begin to run until concrete, client-facing disclosures make “some harm” and a potential causal link reasonably discernible. As a result, this decision will likely influence both compliance practices among family offices and investment advisers and the contours of limitations defenses in advisor-liability litigation in New Hampshire.