Opinion
13-P-1886
11-13-2014
CAP FINANCIAL SERVICES, INC., & others v. MICHAEL REGO.
NOTICE: Decisions issued by the Appeals Court pursuant to its rule 1:28 are primarily addressed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, rule 1:28 decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28, issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent.
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
The plaintiffs appeal from a judgment of the Superior Court and an order denying their motion to amend their complaint. We affirm in part and vacate in part.
1. Background. The plaintiffs are the former tenants of a commercial building that was destroyed by fire in 2006. They filed suit in 2007, and have amended their complaint a number of times since then. In March of 2012, the plaintiffs filed a fourth amended complaint adding a new defendant, Michael Rego, doing business as M.J. Rego Electric, an electrician who performed repairs on the building before the fire occurred, asserting claims of negligence and breach of contract. In April of 2012, Rego answered, claiming as affirmative defenses the statute of limitations and the failure to state a claim upon which relief can be granted.
In November of 2012, the plaintiffs filed a fifth amended complaint, without opposition, which left Rego the sole remaining defendant in the case. Rego moved to dismiss the complaint pursuant to both Mass.R.Civ.P. 12(b)(6), 365 Mass. 754 (1974), and the statute of limitations. The judge allowed the motion, ordering the negligence count dismissed with prejudice on the ground that it did not relate back to the original complaint and was therefore barred by the statute of limitations. She dismissed the contract claim without prejudice. Thereafter, the plaintiffs moved to amend to cure defects in their contract claim. The judge denied the motion, finding that the "facts as they are presented do not support a conclusion that the plaintiffs are intended third-party beneficiaries to the agreement between the defendant and the building owners." Final judgment subsequently entered.
We note that the final judgment mirrored the prior order on the defendant's motion to dismiss in stating that the contract claim was dismissed "without prejudice," even though the plaintiffs' motion to amend their complaint already had been denied.
2. Motion to dismiss. We "review the allowance of a motion to dismiss de novo," and we "accept as true the allegations in the complaint and draw every reasonable inference in favor of the plaintiff[s]." Curtis v. Herb Chambers I-95, Inc., 458 Mass. 674, 676 (2011). The plaintiffs first claim that the judge incorrectly ruled that the fifth amended complaint did not relate back to the original complaint and accordingly was barred by the statute of limitations. We agree.
The original complaint was timely filed in 2007. Rego was added as a defendant in March of 2012. He did not challenge his addition as a party once served. Thereafter, and without opposition, the complaint was further amended in November of 2012. After that point, the judge lacked authority to determine that the amended complaint did not relate back to the timely filed original complaint. The discretion afforded the judge on this issue only properly could be exercised during the motion to amend stage of the proceedings. See G. L. c. 231, § 51, as appearing in St. 1988, c. 141, § 1 ("Any amendment allowed pursuant to this section or pursuant to the Massachusetts Rules of Civil Procedure shall relate to the original pleading" [emphasis supplied]). Because the fifth amended complaint related back to the original complaint as a matter of law, it was error to find "that the relation-back doctrine does not relieve the Complaint from statutory limitations."
We now assess the fifth amended complaint to determine whether it states a claim of negligence. In assessing the adequacy of a complaint, we read the complaint's factual allegations generously and in the plaintiffs' favor. To withstand dismissal, the factual allegations "must be enough to raise a right to relief above the speculative level." Iannacchino v. Ford Motor Co., 451 Mass. 623, 636 (2008), quoting from Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). We therefore look to see whether there are in the complaint "allegations plausibly suggesting (not merely consistent with) an entitlement to relief, in order to reflect[] the threshold requirement of [Mass.R.Civ.P.] 8(a)(2)[, 365 Mass. 749 (1974),] that the plain statement possess enough heft to sho[w] that the pleader is entitled to relief." Ibid. (citations omitted). Rule 84 of the Massachusetts Rules of Civil Procedure, as amended, 385 Mass. 1216 (1982), nevertheless underscores that complaints are "intended to indicate the simplicity and brevity of statement which the rules contemplate."
Here, as the judge observed, the only factual allegation in the complaint supporting the plaintiffs' negligence claim is the following: "In or about the spring of 2006, Rego was retained by [the building's owners] to undertake electrical repairs to the Premises." Additionally, in the claim itself, the plaintiffs allege that "Rego was careless and negligent in its operations, thereby contributing to cause the fire," and that "Rego's negligence caused or contributed to the damages for which the plaintiffs seek compensation." These allegations, while undetailed, meet the requisite standard. See ibid. See also Massachusetts Rules of Court, Appendix of Forms to Mass.R.Civ.P., Form 9 (Thomson Reuters 2014).
Form 9 sets forth the following allegation in a sample complaint for negligence: "On June 1, 1973, in a public way called Boylston Street . . . , defendant negligently drove a motor vehicle against plaintiff who was then crossing said way." This allegation, considered to be sufficient under the Rules of Civil Procedure, does not materially differ from the corresponding allegation at issue in this case.
3. Motion to amend, third-party beneficiaries. The plaintiffs next challenge the denial of their motion to amend. We review the denial of a motion to amend for abuse of discretion, "consistent with the axiom that 'a motion to amend should be allowed unless some good reason appears for denying it' [such as] futility, undue delay, and prejudice to the opposing party." Doherty v. Admiral's Flagship Condominium Trust, 80 Mass. App. Ct. 104, 112 (2011), quoting from Spillane v. Adams, 76 Mass. App. Ct. 378, 390 (2010). To state a claim as a third-party beneficiary, the plaintiffs must sufficiently allege "that the defendant . . . intended to give [them] the benefit of the promised performance." Lakew v. Massachusetts Bay Transp. Authy., 65 Mass. App. Ct. 794, 797 (2006), quoting from Anderson v. Fox Hill Village Homeowners Corp., 424 Mass. 365, 366 (1997). The parties' intent "must be clear and definite." Id. at 798, quoting from Anderson, supra at 366-367. See Doherty, supra at 111. In their proposed sixth amended complaint, the plaintiffs allege that they are third-party beneficiaries "by implication or as a matter of law, insofar as building, fire and related codes are enacted to protect the public . . . ." The judge did not err in determining that this allegation alone failed to support a claim that the plaintiffs were intended third-party beneficiaries of the contract between the building's owners and Rego. As a result, she was well within her discretion in concluding that further amendment of the complaint would be futile.
The plaintiffs' citation to cases such as Rae v. Air-Speed, Inc., 386 Mass. 187 (1982), and Flattery v. Gregory, 397 Mass. 143 (1986), which allude to a legal obligation to acquire insurance, are not to the contrary. Whether obtained by legal obligation or otherwise, insurance agreements are created, and entered into by parties, for the express purpose of paying judgments to third parties. See Flattery, supra at 150-151. The same cannot be said of contracts to perform electrical work. The fact that an electrical code exists to protect the public welfare does not obviate the requirement that the plaintiffs state a claim as clear and definite intended beneficiaries of the contract between the building's owners and Rego. Lakew, supra.
4. Conclusion. So much of the judgment as dismissed count I (the negligence claim) of the plaintiffs' fifth amended complaint is vacated, and the case is remanded for further proceedings consistent with this decision. In all other respects, the judgment is affirmed.
See note 3, supra.
--------
So ordered.
By the Court (Cohen, Wolohojian & Blake, JJ.),
Clerk Entered: November 13, 2014.