Opinion
No. 11–P–930.
2012-05-23
Lance SWANK v. James WOODARD.
By the Court (KANTROWITZ, KAFKER & MEADE, JJ.).
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
The plaintiff, Lance Swank, and the defendant, James Woodard, engaged in several real estate transactions, and memorialized their respective obligations regarding those transactions in a “modification agreement” dated November 30, 2005. The ensuing litigation concerned those transactions and the modification agreement. The trial judge ruled for Woodard on all counts. We discern no error in the judgment for Woodard on all counts of Swank's complaint and on Woodard's counterclaims. We likewise discern no error in the trial judge's decision to award Woodard damages with statutory interest and fees and expenses.
Swank also asserts that the award of sanctions pursuant to G.L. c. 231, § 6F, should be reversed, but this argument is not properly before the panel. General Laws c. 231, § 6G, states that an appeal from a § 6F order issued by the Superior Court “shall be to the single justice of the appeals court.” We therefore need not address this issue.
On appeal, Swank argues that he was excused from performance due to Woodard's own breaches of the contract, that his conduct was not in bad faith, and that awarding the defendant interest was in error because the defendant “had no loss of money.” In making these arguments, Swank essentially seeks to retry the case. We do not, however, disturb the trial judge's findings of fact unless they are “clearly erroneous.” See Mass.R.Civ.P. 52(a), as amended, 423 Mass. 1402 (1996); Marlow v. New Bedford, 369 Mass. 501, 508 (1976). The trial judge is in the best position to determine the weight and credibility of the evidence and the motives of the parties. These determinations “receive special deference from the reviewing court.” Renovator's Supply, Inc. v. Sovereign Bank, 72 Mass.App.Ct. 419, 431 (2008). The trial judge's findings in the instant case were well-supported and based in part on credibility findings. Breach of contract. Swank claims that he was excused from performance because Woodard would not have been able to perform in late 2007 and 2008, and because Woodard's failed monthly payments constituted material breaches of the modification agreement. However, there was adequate evidence to support the trial judge's findings that Swank waived his right to insist on Woodard's timely compliance with the terms of the modification agreement, and that the parties orally modified the contract to extend the time for Woodard's performance beyond April 1, 2006. Contracts can be orally modified, and oral modification may be “inferred from the conduct of the parties and from the attendant circumstances.” Cambridgeport Sav. Bank v. Boersner, 413 Mass. 432, 439 (1992).
Swank argues that because the parties' contract involved real estate, the Statute of Frauds mandates that any modifications had to be in writing, and that therefore the written modification agreement controls. However, Swank did not raise this issue below, and it is therefore unpreserved for appellate review. See Skowronski v. Sachs, 62 Mass.App.Ct. 630, 632 (2004).
When the parties agreed to extend the time for Woodard's performance, they did not specify a new deadline. Rather, both understood that Woodard was obligated to perform within a reasonable time of his becoming financially stable, and that Swank had a corresponding duty to perform reasonably. How much time is “reasonable” is determined in light of the “nature of the contract, the probable intention of the parties, and the attendant circumstances.” Plymouth Port, Inc. v. Smith, 26 Mass.App.Ct. 572, 575 (1988). The trial judge found that both parties understood that Woodard had become financially stable by November, 2007, and that April, 2006 through November, 2007, was a reasonable amount of time for Swank to remain obligated to perform under the agreement. We see no error in the trial judge's conclusion that Swank's failure to cooperate thereafter with Woodard, in late 2007 and 2008, constituted a material breach of the modification agreement.
Bad faith. There was adequate evidence to support the trial judge's finding that Swank acted in bad faith when he refused to cooperate with Woodard's efforts to complete the refinancing of the Vermont property in 2007 and 2008. Bad faith is conduct that goes beyond negligence or bad judgment and “implies conscious doing of wrong” and “a breach of a known duty through some motive of interest or ill will.” Spiegel v. Beacon Participations, Inc., 297 Mass. 398, 416 (1937). The “[a]bsence of good faith of a claimant in litigation may be inferred reasonably from circumstances .” Fronk v. Fowler, 456 Mass. 317, 335 (2010), quoting from Massachusetts Adventure Travel, Inc. v. Mason, 27 Mass.App.Ct. 293, 299 (1989). The trial judge found that Swank was able to perform in late 2007 and 2008, that he was aware of his obligation to do so, and that he had no reason to doubt Woodard's ability to perform. Despite this, Swank refused to negotiate or cooperate with Woodard, refused to agree on a closing date, and demanded that Woodard make a nonrefundable deposit and complete certain forms that were not contemplated by the modification agreement. We discern no reason to disturb the judge's conclusion that Swank's actions constituted bad faith, or his decision to award Woodard fees and costs.
Interest award. Swank argues that Woodard was not deprived of the use of any money, and that therefore the judge should not have awarded him prejudgment interest. The purpose of awarding prejudgment interest is not only replacing lost use of funds, but also “balancing equities” and avoiding “giving a party an undeserved windfall.” Siegel v. Berkshire Life Ins. Co., 70 Mass.App.Ct. 318, 322–323 (2007), quoting from USM Corp. v. Marson Fastener Corp., 392 Mass. 334, 350 (1984), and St. Paul Surplus Lines Ins. Co. v. Feingold & Feingold Ins. Agency, Inc., 427 Mass. 372, 377 (1998). The trial judge had the advantage of hearing all the evidence and observing the parties' testimony. It was not clear error to decide that fairness would best be served by awarding prejudgment interest to Woodard.
Appellate costs and fees. We decline Woodard's request that we award him appellate attorney's fees and costs. Although a close question, we conclude that the appeal was not entirely “frivolous, immaterial or intended for delay,” given Woodard's own earlier breaches of the modification agreement.
Judgment affirmed.